Friends,
The businesses have keep the trade secrets but businesses have to tell truths also to invite the public’s money or the bank’s money. There should be declaration about the matters and developments that company would not be announcing but rest of the matter should be brought to light at the speed of lighting. V Balakrishnan (CFO) of ‘infosys’ has similar openion.
The insider trading can be stopped by a few laws , is a faulted idea. The insiders trading should be allowed to trade albeit after announcing beforehand the quantum and price band of the deal and the time frame along with the reason it is decided for. The key insider may be scheming some thing inside and who can know it. This much risk has to be taken while investing in public companies (Raju could/might have made millions on the strenth of his decision of making disclosure,he had already tripped on ladder of ethics).
The govt is taking more than ever interest at helping ’satyam’ , is it to control damage that may come to congress as a result of Raju’s political connections. I wonder as to why courts have not been moved for transfer of Raju’s stake in ‘maytas’ and other companies to ’satyam’ which can then be sold in market for rasing cash. If the suffer of theft is made to lose further as fall out of theft is no justice. Also what ever the holding of Raju remains in ’satyam’ should also be transferred to a trust and amount after disposal may be brought for the use by company. Any old company may be having owned office spaces in Hyderabad and else where, these properties may be sold and taken back on lease for the time being to take care of immediate cash needs. If the ’satyam’ model of IT services dispensation is OK (they say it is OK) than hardly any damage to the company will occur foor the missing cash as cash was in any case not helping business for years. May be those who buy ’satyam’ stock now will make handsome profits.
I have a further point to make and that is that after such an evetual happening ’satyam’ stock has lost just about 92pc value from its 52W peak of 544 and ‘bajajhind’ has lost 84pc from its 52W peak of 358 while the sugar business is now profitable due to improved sugar prices. The fall in share price of peers is not so low in comparison to ‘bajajhind’. Is skeleton concealed in the cup-board or some insider activity is involved. I have noticed and pointed out to you earlier that the announcements form the company are strangely worded and conceal more than reveal. There is rumour that crushing season will end soon and crushing is at low ebb already. The respective companies have not announced their actual crushing figures on monthly basis and so far. I have no doubt that the sugar managements would play games and even under report profits. If the govt feels concerned for the sake of share-holders and farmers it should do some probing into their accounting and other practices. The sugar comapny management should become very honest in their conduct of business or go private. One can’t have all this and haven too. The centre should take steps to take away the powers of state govt at arbitrarily announcing sugar cane prices and of controlling molesses like by-products which results in black market etc. The sugar release mechanism should also become very open and purposeful.
Market were flat yesterday, Nifty closed at 2750 (2000D SMA is at 2462). It means the regular investor for past seven years has still not lost besides having gained dividends. Should it breach 2462 level, it will mean equity investing has been a bad idea.
Asian markets have opened up today.
HariOm,
krsnaKhandelwal
