Friends,
An astounding number of 200 channels have made debut since 2000 and
the total stands now at 326. The advertisers have tough time now. The
channels devote ten minutes per hour to ads , at 10 seconds for an
average ad the total number of slots available comes to 288000 on air
every day. 80% of the viewing time is taken up by 43 channels. All
this throws a challenge to advertisers. Big companies in fast moving
consumer goods have been facing this problem and are spending a lot
for the publics’ attention. I think there would some new ideas
developing in the field of advertisement for effectiveness.
PC market (desk top and notebook) touched 1.53 m units for the quarter
April-June 07 (+22%). The notebook sales have been better by 73%.
China wants US to grant banking licences more liberally and offers
bigger share to US banks in its own market. US , however , is
unwilling to alter rules for such a trade off.The Chinese mussle power
is increasing a break neck speed and I think it will have its way
through in to US.
Motilal Oswal replaces Dhampur Sugar in BSE 500 list.
On the 25 th Sept 07 , some 301 stocks hit the all time high level and
only 496 stocks hit 52 W high level. These 496 stocks account for the
46% of the $1.11 trillion total m/cap. Also 409 % stocks which account
for the 31% of the m/cap are trading below 10% of their highs. This an
indication of some kind of churning going on, only if it is based of
fact there would be no objection to it but the timing which is just
before the quarterly result announcement gives reason to be wary of
it.
Steel ingot prices have gone up by about Rs1000/- per ton during the
fortnight but it is not enough to see the SAIL and Tata Steel at the
levels past 200/850 in the recent bull run.
Textile sector is in trouble ue to rising rupee. In the ready made
apparel sector some 2lac jobs would be finished in the next 2-3
months.
World third largest Risk Mangement Service provider MSCI Bearns will
partner Reliance Mutual Fund (biggest AUM fund house in India) to
provide services.
SEBI allows MFs investment in overseas secuities/instruments uto $300
m agaist $100 m earlier.
Old established IT companies have seen their bottoms hit, I expect no
more breaching of the recent bottom levels. It stems from the fact
that these companies operate mostly out of the owned premises at good
localilities. Since their equipment are written off in less period,
the invesments in land and buildings is a higher proportion of the
book values. The property prices have gone up by over ten times in
the cities of there activity , it may well be taken that the market
value of their owned real estate would very close to market value and
hnence th dollar weakness and business slowdown would not affect
rather should not affect the share prices.There also a possibility
that the sops to IT and Software sector would be extended beyond 2009
.
The FII inflows have topped Rs12 K Crs mark in the week gone by for
the month of sept 07 while for the year 2007 this figure stands at
over Rs 47K Crs.
GIC net is up at Rs 1531 Crs for 06-07. GIC is the only reinsurance
company in India . GIC’s solvency ratio improved to 4.1% against
statutory 1.5%.
Oberois have ended alliance with Hilton and would be pushing their own
Trident Brand for hotels with EIH.
The average wages paid by Indian govt. to all catagories of people ie
Administrative/Teachrs/ General Clerks/Typists/Service
Workers/Cleaners etc are higher by between 1.42 time to2.45 times of
what the private sector pays. This appeared in World Bank report of
1999/2000.
Baja family is on war path, Shishir is upping stake in Bajaj Hindustan
after their agreement earlier could not be implemented.
Iran may sell gas to China if there is still more delay in finalising
arrangements between Iran, India and Pak in this regard.
The European Bank’s emergency lending fund which attacts penal
interest was tapped for about Euro 3.9 b on the 26th Sept 07 . This is
the largest sum since 2004. Growth in money supply remained at high
11.6% in Aug 07 only slightly lower than July 07 and ECB’s target
inflation rate og 2% may be breached.Since dec 05 ECB lifted its main
interest rate eight times to 4% but fought shy of raising it further
to 4.25 this month as was on card.
SEBI is on watch out , it has reason to believe that some barred
enties are again active through front broking houses. The manipulation
in seems more real now, but the speed of reaction by SEBI again would
be like locking the stable after the horse has bolted.
Do you know that close ended MFs charge 6% of the funds generated but
ammortise them ove a few years thus giving distorted NAVs to that
extent. The open ended funds mostly charge 2.25% as entry fees. Should
you , therefore , regard the ULIPs as much more cost effective and
transparent.
India aims at sending manned spacecrafts in to space by 2010.
The Nifty PCR stood at 1.58 on 27 Sept 07 and is on the high side
suggesting instability
in market.
Nifty close at 5021 at end of the week on 28th sept 07 gaining 3.8%
over the week.BSE auto index at 5332 was +1.17 % over the last one
year period, similarly, other indices closed the week like BSE Bankex
at 9496 (+55%),BSE-CapGoods at 14679 (+80%),
BSE Con. Durables at 4804 (+57%), BSE FMCG at 2161 (+6%), BSE
Healthcare at 3787 (+3%), BSE IT sector at 4627 (+5%), BSE Teck at
3766 (+25%), BSE Metal at 13945 (+64%), BSE Oil at 9561 ( +64%), BSE
PSU at 8202 (+41%). These figures should be pondered over.
Our total m/cap is just 2.21% of the wolrds’ total m/cap og $58176b.
Our Indices have become more volatile for two reasons ie they have now
interest from all over the world as they have delived handsome returns
over the past decade , also under a very healthily managed and
monitored capital market place and second is that our size is too
small to adjust to the rise and fall of the money from around the
world. This has made our market more volatile and some thing should be
done to correct this position. One such step would be to tax the liste
enties at lower rate than the unlisted one so that the icentive to
list is there and the hassels of managing the affairs under public’s
constant watch ar ecompaensated suitably.Another measure may be to
allow full tax expemtion on investment in to first time issue of
capital by a company whether for a green field project or by an
existing company. If the size of the market does not increase it will
keep loosing its importance and the growth in market size based on
only the already listed companies and the tickling fresh issue of
capital will ultimately be disastrous for the people like it happened
when Harshad and the people of his ilk later were able to influence
the markets with only very small sums of money that too which did not
belong to them . I have a fear that the history is going to be
repeated this time too with a wider remifications due to involvement
of much number of people in the markets now.
I think I have told enough to convey the message and the you all will
apply discretion while delving in the market just now.
HariOm,
krsnaKhandelwal
