India Morning report: This week in history of 2050: The sun rises on the east India Company in Asia

With half-hearted restrictions on Dollar flows talking of Capital controls and engendering a Rupee ‘addition’ to the value of the Dollar and European Banks getting free after a couple of years in Capital wilderness, India could be a bigger part of Asia when Banks get into a new bout of short term credit , not just Transaction based Banking which s already operating with preference to SCB, DB and Emperor HSBC in the area. The new east India company, third edition would thus be the rupee benefactor with true self interest reserved in trading than the hitherto close coordination with businesses and governments on policies in the countries in the region. We have in Asia however successfully staved off such pressure since 1987 esp outside the East and North Asia belt where foreign interest makes up a dominating market share of the Financial Markets in debt and equity

The Rupee runs close to half its weekly move at 66 on Tuesday afternoon itself leaving very little to the imagination as conservative and HTM Indian risk offices as they price in the Dollar at between 70 and 75 for current short term rate planning, which hastens he move to 78-80 soon. The nifty pre expiry range has broken own in the same hindsight and with 5500 inaccessible, technically markets run another steep wall o try and find stable levels especially with long futures holdings from offshore desks dominating in the morning . The 5325 index may well stop south of 5000 as the longs were never to be rolled over in any case and the cash buying will unlikely be sufficient in volume to increase index level prospects in the September series.

East India Company (video game)
East India Company (video game) (Photo credit: Wikipedia)

Banks suffered for the active monitoring feared by Expoters and importers trying to go the extra length made available by the steep wall in Dollar Rupee trade ad all of Asia is a little straaped for Dollars as investors respond to fund exits and rebalancing of the last full QE portfolios. The East India co though like all Capitalist colonising ventures do not invest in local quality anymore, which the Bombay club has long neglected but in true 2013 models, there is no growth yet to justify keeping the depression ship with increasing investments and growth in Exports still easily outpaced by the cost of imports leaving more rupee for each Dollar till it does. Government Spending has improved and i would aver short term interest rates are helping in ensuring immediate focus on the Capex cycle as well but investments will come only when higher realisations are available and so inflation may even need to be roomier as in a new frankness in pricing Gas and diesel, that has enabled that consumption cycle without any political fallout. the Cereals and Milk have gone thru the supply bottle neck based realisation improvement and vegetables price hike may also be done in 2-3 months

 

India Morning Report: Markets watching the airlocks at 1.30 PCR

Русский: Дорожный знак 1.30 "Низколетящие...
Русский: Дорожный знак 1.30 “Низколетящие самолёты”. (Photo credit: Wikipedia)

The Put Call Ratio, never an independent trend saturation indicator per se is nevertheless impeding most new buying in the Indian Markets as a higher PCR indicates the highest levels of puts sold and comparatively a negligible strength of written calls to initiate a downtrend. Given that the banks have recovered the sentiment to 11200 levels though, the unique topped up situation will continue to walk a steady tightrope for the markets at this point because unfortunately  traders are sunk for short ideas except for targeting the private banks again even as the perfectly engineered ride up to the market has left value in most rivate banks and in most blue chips.

Bajaj Auto at 1870 is hardly compensated for its Margins of 18.65 and Hero Honda is no longer overvalued. Reliance is again hardly left with any steam on the upside but with investment eigenvalues in India rarified Himalayan peaks, such stories are hard to come by for India and will unlikely get short interest even on their Q2 results day when they report barely coming back to /staying at normal profitability levels ina challenged environment. The INR 44 Bln sales at Bajaj are only bolstered by the new rupee and so also for petroleum cycle bled Reliance as oil starts going up after a barely 6 month breather to importers like India

Manmohan Singh did a great job holding 8 channels to task while inaugurating the ASSOCHAM session today morning, taking of true reform ably effected in  energy and the rupee levels helping export volumes 9 again, without discovering that direct relation to be not more than a fond hope anymore) as commodities continue to sink globally except for Oil, led by Indian exports of Cotton and copper also losing value and market like its exports of Tea Coffee and anything else non Gold as the quality is exactly what the buyer did not order, good or bad

English: A rectangle 270x180 pixels which has ...
English: A rectangle 270×180 pixels which has an aspect ratio of 3:2. (Photo credit: Wikipedia)

Me, I was even thinking it s saturday all morning and the markets are virtually closed..ET’s report on July currency trades this Monday..

The data shows that average daily volumes for currency options have fallen by as much as 79 per cent for one of the exchanges so far in July, but another bourse have witnessed a hefty drop of only 35 per cent.

Meanwhile Raymond and Indian Hotels are not going to be traded derivatives from the Octoebr series

India Economic Upgrade destroyed in time for a questionable “manufacturing revolution”!!

Image representing Infosys Technologies as dep...
Image via CrunchBase

The Indian Services GDP is probably in threat as India loses its leadership of the incipient global Services sector growth, where it now enjoys a barely positive PMI at 52 after a big slide from 54 in October and instead the remaining almost vestigial 18% of Indian GDP that is manufacturing has taken pride of place with a more than 54 clip in the PMI sub indices in November, leading KV Kamath, an industry doyen one would not belittle or argue to claim apparently that India’s manufacturing sector is resurgent. Which again, reminds of some other key mistakes from organisations like India Inc’s ICICI Bank and Infosys which have made other such weak claims earlier in the nineties and the noughts while using other selling strategies to actually gain power of mind and mindspace over the budding markets they have indubitably created.

Not that market development has gained any recognition in the meantime but there are many other areas not forgetting major discrepant growth inputs missing from India Inc like our FMCG sector and Retail where both branded output is still stuck at 15% of market after two decades of reforms and is not growing share of voice or market even at a resurgent and well nigh bharat consuming and growing at twice the pace of Urban India albeit with unbridled inflation in urban India than any other reason to blame.

icici bank
icici bank (Photo credit: Wikipedia)

Is the real consumption franchise anywhere near increasing and is any growth in manufacturing paradigms really possible. One should be careful in using carrots for a generally more educated and access powere urban and rural market in India before making such superfluous conclusions the mainstay or athe retort you have as a personage of voice int he Indyustry and in the nation that is busy pinning down its real core advantages and probably needs more focus on items of Services, Welfare and Infrastructure than Construction and whatever manufacturing we need here to survive.

English: K.V. Kamath, Managing Director and Ch...
English: K.V. Kamath, Managing Director and Chief Executive Officer, ICCI Bank; President, Confederation of Indian Industry, speaks at a plenary session titled Risks to India’s Economy in a Post-Crisis World held at the World Economic Forum’s India Economic Summit 2008 in New Delhi, 16-18 November 2008. (Photo credit: Wikipedia)

 

Pay me my VIX – India Morning Report ( Monday Pre Market Open 03/06)

Though the SGX Nifty has factored in all weekend heebie jeebies into the opening price, the increase in Volatility on Friday to 26-27 would indicate a likely rush to reach the “ultimate bottom” and shorts on Nifty seem to be controlled and careful while the buyers have been out in full strength at these prices even in 4900 calls now. At the worst it will be more 4400-4500 puts and 4700 calls. However, the week is crucial to determine india’s fiscal and monetary future. If it enters a bottomless pit behind these 4700 levels it will likely find more bananas than the precious investment which has already jumped to 3.5% from a contraction in the earlier quarter in the latest 5% growth shock

Consumer and Pharma remain very critically poised sectors as well. IT is more negative than positive and Banking is more positive but yet the pressures on the Sector are really higher even in quality like ICICI, HDFC, SBI and of coure the vulnerable axis under new management

Going back to the VIX, a higher VIX should mean higher returns on the Spreads, esp if you use Vertical spreads. Also cover asymmetrical strategies if you have sold calls

The India IIP Report (February 2012)

Capital Goods production came at 10.6% , Electricity came at 8% but Composite IIP came at 4.1% up from less than 2% in January(1.14%) with Manufacturing at 4% overall. IIP is still at the lower end of the possible range. Janiary was revised down from 6.8% on sugar production data

Capital Goods and Electricity are back to highs after a -2.6% and 3.2% data scores for January 2012 Markets largely ignored the volatile data as Fenb and March GDP is already assumed to be further lower than December 2011. Consumer and durables data show great contraction 9available as inference)

Meanwhile the INR 40 bln infusion inoto Air India is hardly likely to suffice for the megalith which has run down its entire equity

 

So are P Notes in or out

CoA of Mauritius Français : Blason de Mauritiu...
CoA of Mauritius Français : Blason de Mauritius Deutsch: Wappen von Mauritius (Photo credit: Wikipedia)

Well, i understood it thus. There were first the Anti avoidance rules called the GAAr rules which were intended to catch those who benefit from the treaty in Mauritius without belonging to Mauritius per se , with a token presence not backed by assets or business i.e. Offshore investors. These offshore investors have been targeted.

Two, in the clarification on Overseas M&A transaction involving india assets, the intention is not to cover P Notes because underlying equities are Indian Assets. So that piece was unnecessary walk in the park while the trucks were running up and down and you could have all avoided the noise.

The real rule details would thus clarify how Portfolio and FDI investor would be welcomed and how revenue leakage from Maurtitus a s a treaty participant, which remains the key example, would be taken care of now that the new treaty signed has included only token changes at the behest of the Mauritius government. And no clarifications are available yet. We are looking.

Looking for a Used Car market in India?

The used car market in India has matured in the last two decades with ready company owned used car operations  from Hyundai, local franschised multi store (warehouse) operators like Classic Cars and even multi brand all purpose car repair chains from Carnation.

Red Lamborghini Gallardo, to be used as an icon.
Image via Wikipedia

The current story in the papers of course is the DNA money story on Diesel car demand landing an unusual bonanza for petrol models, as used car sellers are almost holding mass clearance sales int heir own way for their inventories of petrol models. Diesel models have hostorically enjoyed premiums to ensure basic availability and noww with Diesel car demand growing that premium has shot up enough for that neighbourhood ‘s tore’ to give away petrol cars for cmore losses esp where he owns the inventory. Individual sellers will have to hold on to their crs longer to get the price they want for their favourite ride.

Lesser Deals but good PE Deals and Exits

2011 was as much about making business happen as any other year despite deal business going down by 30% to $460 mln in the year in India and as usual we had a consultant reporting on growth from the India corneer of the world in Investment Banking as global focus shifts to fee adviisory business. India’s share is a less than 8% of the Asia pie which itself yields a 4 1 mln lower than each corresponding deal in the US on average. US leads in investment banking deals this season as well

The largest component of the deal business in India continued to be Private Equity with VCC listing the Top 5 deals and the Top 5 exits in the big ticket deals that went down.

Earning nearly $500 mln from fees may be still much lower for investment bankers to satisfy staffing for growth 5 years out esp as the region’s deal yields depend on Pe which is currently fighting funding and legal wars in their global franchises as regulations circles around to make it tougher for them to ensure profitability on deals following numerous failures in high fashion and early / blocked exits in existing deals.

It was especially happy for the bankers and the PE teams for gettin gthrough these deals in 2011

The Unemployment Economy – India’s coming talent squeeze

IMG_1195
Image by debcha via Flickr

India’s asynchronous naure withthe global Economy has more or less been locked in by a past generation’s ascendancy to the senior positions. Even in my colleagues (peers) I would find the unemployable having stuck to their positions and holding positions of influence in the few MNC corporations and global consultants that are India-centric in one or other key strategies.

The situation at the senior levels has always been used as an excuse to rejuggle portfolios and in some cases fatten middle layers without any career visibility and without focus on keeping strengths as the companies have few hiring department staff who can work with qualitative factors anymore  and no India offices/branches/franchises ever having allowed any performance based arguments on who or what should lead their Office. The top employers surveys by AON Hewitt and by ET-GPWI both do show up these glaring deficiencies, but more importantly for a lot of India’s senior management layer, it means an abrupt end of the road a middle / regional levels and we keep getting Mis s World / Miss Fashion kind of global nominations once a year to offset that imbalance. Somehow, our hiring departments focus on the TT ratio for cost effectiveness has cost us the plot and we are busy using he same as bargaining chips for the hundreds of internal movements, the real talent having been neglected watching from the sidelines..another humdrum year of ennui where none of the unemployables remaining in those positions need do anything to keep their job or even the next promotions by virtue of sitting in their current seats of unachieved and untempered workability negotiating new office deals and water bridges to go to Africa gleefully

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