panch-tattva talk…rupee strong,inflows high


The rupee (at 47.89/dollar) has become stronger and the capital inflows are high. The RBI chief has started making the expected noise about having to take measures for curbing money supply. I am surprised what makes RBI shiver when the flows are high and there is more money here to work with. What is so scary for them that want to upset the apple cart. If rupee gets stronger and hurts the exporters it may just buy some dollar and help. Afterall China must have doing the smae to keep the Rembini down. Has it not achieved the unthinkable of India type growth rate. We have to shed our still sticking remains of the Hindu Rate of Growth era. It will not yet harm India to cover more ground in short term for we still haven’t taken care of the nutrition and health needs for all, leave apart shelter and education.

The telecom scrips were badly mauled yesterday for no known fault of theirs besides having the courage to compete on strength of market getting larger and being successful at cutting costs. This is a natural outcome of many players in the field that has room for two or three that the fierce competition get underway and eventual consolidation (through mergers of weaker with stronger takes place). Did I not tell you that Bharti is uselessly trying to go global while home turf has to secured. I must appreciate RCOM for boldly initiating price war, India is going to get more integrated as a result and the movement of labour more free because the people away from home may remain more in touch.What a wonderful development is new age telecom, the lowliest have more power to communicate than Akbar had. The wise would buy into both the leaders, RCOM and BHARTI.

You have seen that the rebound here has been dramatic, the Nifty closed higher yesterday at 5027. Europe and US economies have yet not been out of nursing ward but the stocks there have no intention to reflect that situation and scaling up ( Obama is on side of more spending and tax cuts as the jobs are still disappearing).

SAIL has half the slice of Chiria mines and the other half will go to private palyers.This ensures future supply of ore to SAIL (Chiria reserves are about 2 billion tonnes).

Sugar scrips are on wicket at the moment and should form part of your portfolio for the time being.

Steel scrips were up but out of turn, the steel prices are subdued since some time back.

The Hindustan Unilever did a rope trick yesterday which is unlike its character. This was due to the fact unloading of soem part of portfolio generated cash and since the players are in no mood to withdraw cash HINDUNILVR was lapped up. Surely times have changed for the FMCG and Pharma which will have a larger population with more spending power and better awareness about their products to cater to. So this is also a sector to be viewed with some degree of greed.


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