Monday, April 6, 2009

SectorWise Sensex

Performance of various Sectoral Indices of Sensex. 
Full Year period is 1-April-2008 to 31-March-2009
First Half period is 1-April-2008 to 1-October-2009















Realty fell the most in last 1 year with a fall of almost 79.1% ! 
Realty is followed by Small-Cap(58.7%), Consumer Durables(58.2%), Metals(58%) and Mid-Cap(53.8%)!! 
In my next post, I will cover the Index movers i.e. the stocks which moved these indices the most. 

Wednesday, April 1, 2009

Nifty in 2009

Nifty has moved up 2.09% in 2009. It closed at 2959.15 on last day of 2008 and by the end of first 3 months i.e. 31 March 2009 it is at 3020.95! 
This is the list of how Nifty stocks have performed in last 3 months. Note that this is not index movers since they have different weights. 
Also to be noted here is Zee Entertainment is replaced by Axis Bank on 27 March 2009 and and Satyam replaced by Reliance Capital on 12 January 2009 ! 

Name31-Dec-08     31-Mar-09   % Change
Maruti Suzuki520.2779.8549.91
Mahindra Mahndra274.5383.6539.76
Sterlite Indu260.1357.637.49
Hero Honda803.651071.1533.29
Grasim Ind1219.851582.1529.7
Steel Authority77.596.4524.45
Reliance Indu1232.751524.7523.69
ACC480.15574.419.63
Gail206.25245.619.08
Infosys Tech1115.451323.918.69
Cipla Ltd186.6220.0517.93
ONGC667.1780.216.95
Pwr Grid Corp83.1595.614.97
National Alum189.45214.6513.3
Tata Motors159.85180.312.79
Tata Consult477.9538.5512.69
BHEL1362.61510.5510.86
Reliance Petro87.295.19.06
ITC171.7184.857.66
Cairn India172.05184.17
Wipro Ltd233.4245.95.36
Sun Pharma1064.151111.454.44
Tata Communi501.75518.353.31
Tata Power749.15768.62.6
Hindalco Inds51.452.051.26
Ambuja Cem70.0570.60.79
Bharat Petroleum376.1376.05-0.01
NTPC180.6179.85-0.42
HDFC Bank998.35973.4-2.5
Idea Cell52.6550.1-4.84
Housing Dev Fin1486.41412.2-4.99
Hindustan Unilev250.3237.5-5.11
Tata Steel217.2205.9-5.2
ABB Ltd (India)453.8426.7-5.97
Siemens286.95268.1-6.57
Reliance Infrast579.5515.55-11.04
HCL Techno115.3102.05-11.49
Bharti Airtel715.5625.75-12.54
L&T773.75671.4-13.23
Unitech40.6534.9-14.15
Reliance Power119.95102.35-14.67
State Bank IN1288.81067.1-17.2
AXIS Bank504.7414.95-17.78
Punjab Nat Bk526.7411.45-21.88
Reliance Commun227.2174.85-23.04
ICICI Bank448.1332.8-25.73
Suzlon Energy62.342.35-32.02
Ranbaxy Labs252.35165.7-34.34
Reliance Capital541.75353.45-34.76
DLF282.15167.3-40.71


If we look at it sectorwise, Banks have gone down. We see ICICI, PNB, Axis Banks, State Bank at the bottom alongwith Reliance Capital. Worst hit in 2009 is DLF!! 
Important sector which saw a positive signal in 2009 is automobile. We see Maruti Suzuki, Hero Honda, Mahindra and Mahindra topping the charts. 

Wednesday, March 25, 2009

Nifty - change in consituents

India's major equity index has seen change in weightage since last year. First of all a summary of whats added and whats removed in last 1 year:
  • on 10-September-2008 Reliance Power added and Dr Reddys Laboratories Ltd removed 
  • on 12-January-2009 Reliance Capital Ltd replaced Satyam Computer Services Ltd
Over the period we saw weightage of Giant PSUs increasing on Nifty. 
  • NTPC increased from 5.62% to 8.19% now, increase of 2.58%! 
  • ONGC increased from 7.83% to 9.10% now, increase of 1.27%! 
  • Similary Infosys weightage increased by 1.26%, ITC by 1.15%, Hindustan Unilever by 1.03% and Reliance Industries by 1.01%.
On the downside we see DLF, Reliance coomunications, Unitech and ICICI losing their weights on Nifty:
  • DLF decreased from 3.93% to 1.54% now, decrease of 2.39%!
  • Reliance communication decreased from 3.79% to 1.82% now, decrease of 1.97%!
  • Unitech weightage decreased by 1.29%, ICICI Bank by 1.17% and L&T by 1.1%.
This chart shows how weights have changed sectorwise:


This shows the current weights in NIFTY:





Thursday, March 19, 2009

India Inflation at all time Low

Wholesale price index for the week ending 7th March fell more than expected to 226.7 pulling inflation down to 0.44%, an all time low. Previous all time low was 1.13% in February 2002. Very soon inflation will fall into negative territory now. 

Wednesday, March 18, 2009

Market Summary (comparing 52 week High-Low)

I did this analysis on 500 stocks in BSE-500 Index. I wanted to check stocks which are farthest and nearest to their 52-weeks Low and 52-weeks high. 
(This is the first time I tried this, so please let me know if there is any mistake and pour in your suggestions and comments)

1) These are the names which are farthest from their 52 week high. Note that these all reached their highs in March-May '08. They have almost lost their entire wealth with Vishal Retail losing as much as 97%. Another known name in the list is Maytas! 

NamePriceYear HighYear High DateDistance from High
Vishal Retail Ltd25.65879.954/1/200897.08%
Prajay Engineers Syndicate Ltd13.15319.93/26/200895.89%
Maytas Infra Ltd33.957504/2/200895.47%
B.L.Kashyap & Sons Ltd89.5517505/2/200894.88%
Cals Refineries Ltd0.366.75/30/200894.63%

2) These are the names which are closest to their 52 week high. Note that Hero Honda and Akruti City are reaching highs this week. Important here is Akruti City which has doubtfully risen almost 84% from 858 to 1577.8 in first 10 days of March. 

NamePriceYear HighYear High DateDistance from High
Power Grid Corporation of India Ltd96.3108.455/5/200811.2%
GlaxoSmithkline Pharmaceutical Ltd1155.851233.72/18/20096.31%
Colgate Palmolive (India) Ltd448.35473.83/2/20095.37%
Akruti City Ltd1577.816103/17/20092%
Hero Honda Motors Ltd974.359853/13/20091.081%

3) Here are the names which are now closest to their 52-weeks low. But also note here that these names reached their 52-weeks low very recently. 

NamePriceYear LowYear Low DateDistance from Low
Greaves Cotton Ltd50.450.13/17/20090.59%
Future Capital Holding Ltd93.792.93/12/20090.85%
Raymond Ltd70.7570.053/9/20090.99%
Allied Digital Services Ltd147.8146.053/12/20091.19%
Vishal Retail Ltd25.6525.253/17/20091.58%
Jubilant Organosys Ltd86.4853/17/20091.64%
Apollo Hospitals Enterprise Ltd356.453503/17/20091.84%
Mindtree Ltd190.6187.13/13/20091.87%
Alok Industries Ltd11.5511.333/17/20091.94%

4) These are the names which are farthest from their 52 week low. 

NamePriceYear LowYear Low DateDistance from Low
Matrix Laboratories Ltd97.754811/25/2008103.65%
Dish TV India Ltd 24.611.7510/27/2008109.36%
Jindal Steel & Power Ltd1101517.310/27/2008112.84%
National Aluminium Co Ltd230.7108.3510/27/2008112.92%
Birla Corp Ltd1707110/27/2008139.44%
AllCargo Global Logistics Ltd694.65271.8510/31/2008155.53%
Spice Communications Ltd 63.0523.253/24/2008171.12%
Akruti City Ltd1577.8550.051/15/2009186.85%
Satyam Computer Services Ltd43.5511.51/9/2009278.69%


Chart presenting number of stocks and their distance to 52 week low.

Chart presenting number of stocks and their distance to 52 week high.



Friday, March 13, 2009

Declining Inflation

Inflation for the latest week came down to 2.43%. It is little better than I estimated below. But still if WPI number doesn't improve in the coming week then most likely inflation will dip below 0 by March end as I have calculated and shown earlier. Current level of inflation is lowest since June 2002. This is attributed to the record fall in the factory output. 
Now I present the historical graph of Inflation in India since 1995. 


The highlights of Inflation in India since 1995:
1) Lowest inflation was in February 2002, when inflation was at 1.13%.
2) Peak of 2000 can be attributed to the .com bubble when IT companies flooded India.
3) In February 2008, Inflation was at peak of 12.91%. 

Please give suggestions, analysis, information if you have on this topic. 

Tuesday, March 10, 2009

Easing Inflation


Continuing my previous blog on inflation below. Here is current inflation graph.


We see a steep drop in inflation resulting out of falling crude price which results in lowering price of commodities. Series duty cuts again eased the inflation. It is expected that by March end inflation could come to Zero!

Here is the calculation how inflation can very well cross 0. This is the inflation calculation for last month. Our WPI is decreasing constantly leading to lowering of inflation. WPI till 21/02/2009 is known. Now lets assume that WPI for following weeks remain constant at 227.6 (as it is constantly decreasing so in best case assume it doesn't decrease). So we see inflation for first week of March would be 2.38% and 0.84% for the second week of march. This is because there is a small jump in the inflation same time last year. So even if current WPI remains constant but when it is compared to a higher number the inflation figure comes down. And hence we very well see negative inflation by March end. This is the best case scenario, inflation can get to zero much before if WPI keeps falling.

Date WPI Date WPI Inflation
07/02/2009 228 09/02/2008 219.4 3.92%
14/02/2009 227.8 16/02/2008 220.4 3.36%
21/02/2009 227.6 23/02/2008 220.9 3.03%











227.6 01/03/2008 222.3 2.38%

227.6 08/03/2008 225.7 0.84%

227.6 15/03/2008 226.4 0.53%

227.6 22/03/2008 226.6 0.44%

227.6 29/03/2008 226.7 0.4%

227.6 05/04/2008 227.8 -0.09%

227.6 12/04/2008 228.2 -0.26%

In my next blog I will explain impact of inflation less than 0 called 'Deflation'.

Wednesday, March 4, 2009

Another Stimulus Package: Rate cuts

Reserve Bank of India cut Repo and Reverse Repo Rate by 50 bps. Repo rate, the rate at which central bank (RBI) lends to banks is now at 5%. Reverse Repo is the rate at which central bank takes money from banks is now at 3.5%. This was very much expected for quite some time with growth as a key issue and inflation quite low (As Rate cuts can take inflation higher, but inflation is already at a low of 3.2% now) RBI cut rates to infuse more credit. Banks are now expected to cut lending rates. Though there is no change to CRR, as RBI believes there is enough liquidity in the system.

This Rate cut is done after worse than expected figures across the globe. The global cues for this were:
  1. US real GDP contracted sharply at an annualised rate of 6.2% in the fourth quarter of 2008
  2. Unemployment rate in the US has moved up to 7.6%
  3. The real GDP in the euro area also declined by 1.5% in the fourth quarter of 2008
  4. Japanese exports fell by 45.7% in January 2009
  5. Japanese economy also contracted sharply by 3.3% in the fourth quarter of 2008

In short the major effect of these cuts could be:
  1. Cheaper loans and lower deposit rates by banks
  2. Better GDP figures for the 4th quarter
  3. Increase in inflation by small amount
  4. Weakening INR against USD
There have been series of rate cuts since Dec '08:
Reverse repo rate (%)
Jun 8 ‘065.75
Jul 25 ‘066
Dec 8 ‘085
Jan 2 ‘094
Mar 4 ‘093.5

Repo rate (%)
Oct 20 ‘088
Nov 3 ‘087.5
Dec 8 ’086.5
Jan 2 ‘095.5
Mar 4 ‘095

Monday, March 2, 2009

INR, Crude


INR 
1) INR which was getting stronger at 40 at this time last year is now struggling at 52 and some says the situation could get worse and INR could reach 55. 
2) This benefits exporters as they are paid in $ so they got more INR for their products.
3) This also favors IT industry as most of the out sourced work is paid in $. But IT companies hedge themselves against rising INR by buying 6 months to 12 months future. So this fall of INR might not help them. 
4) Also in the current time of global recession exports are already low and Obama's protectionist policy is already affecting Indian IT. 
5) Currently INR bid/ask = 51.6/51.62
6) The Indian finance ministry has begun a public competition to select a design for the symbol of the rupee! 

This is historical performance of Indian Rupee: 


Crude Oil
1) Crude was falling freely for quite some time. It now shows some sign of improvement after production cut by OPEC. 
2) Reached 47.07 a barrel from 40.15 a barrel in a week. 
3) 1 Barrel is 42 Gallons or 159 Lts (US liquid Gallon is equal to 3.7854 Lts)
This is historical performance of Crude Oil:







ADR

What is an ADR / GDR?

Indian companies issue shares which are traded on Indian stock exchanges like BSE, NSE etc. These shares are sometimes also listed and traded on foreign stock exchanges like NYSE (New York Stock Exchange) or NASDAQ (National Association of Securities Dealers Automated Quotation).

The company deposits a large number of its shares with a bank located in the country where it wants to list indirectly. The bank issues receipts against these shares, each receipt having a fixed number of shares as an underlying (Usually 2 or 4).

These receipts are then sold to the people of this foreign country (and anyone who is allowed to buy shares in that country). These receipts are listed on the stock exchanges. They behave exactly like regular stocks – their prices fluctuate depending on their demand and supply, and depending on the fundamentals of the underlying company. These receipts, which are traded like ordinary stocks, are called Depository Receipts.

Following are the major Indian ADRs:
Cognizant CTSH
HDFC Bank Ltd. HDB
ICICI Bank Ltd. IBN
iGATE Corp. IGTE
Morgan India Investment Fund . IIF
Infosys Technologies Ltd. INFY
Mahanagar Telecom MTE
Patni Computer PTI
Dr. Reddy's RDY
Rediff.com REDF
Satyam SAY
Sify Ltd. SIFY
Syntel Inc. SYNT
Tata Motors Ltd. TTM
Videsh Sanchar Nigam VSL
Wipro Ltd. WIT
WNS Ltd. WNS
The India Fund Inc. IFN
Sterlite Industries India Ltd. SLT

Saturday, February 28, 2009

28February2009

GDP growth of Indian at 5.3%

GDP growth of India (12 largest GDP of the world) is estimated at 5.3% for the October –December 2008 quarter, which is a 6 year low. This is mainly caused by 2.2% decline in agricultur and 0.2% decline in manufacturing sector.

First 9 months of this Fiscal GDP growth now is 6.9% (Q1: 7.9%, Q2: 7.6%, Q3: 5.3%). Projected growth for this year was 7.1%. Now to get this projected growth last quarter should have 7.7% growth. Considering recession, growth of last quarter is expected to be around 5% and so we"ll miss the projected growth by quite a margin.

How GDP is calculated?

The method of Calculating India GDP is the expenditure method, which is,

GDP = consumption + investment + (government spending) + (exports-imports)

i.e. GDP = C + I + G + (X-M)

The other two methods of calculating GDP are Product wise (Calculating the total production) and Income wise (Calculating the total incomes received by factors of production - labour & capital)

Meanwhile, US economy shrunk by 6.2% for the same period of October-December 2008. This is its worst hit since 1982.


INR at 51.12 against Dollar

INR reached its all time low of 51.12 per dollar. This is mainly due to heavy demand for dollars. Dollar gained against Euro and Pounds yesterday. So, this gave opportunity to investors to buy dollars from India and sell it outside. Widening of Fiscal deficit from 2.5% to 6% already led Re to fall below 50 mark. Taking measures for growth RBI may further cut rates. This will further bring Re down. Another impact would be on inflation which has already reached to a low of 3.2%. We might see further fall in inflation in view of rate cuts and annualisation factor.

Thursday, February 26, 2009

List of CEOs of major Indian Companies

Many a times we want to know CEO/Chairman of some major Indian company. I have compiled a list that would be lot helpful. Let me know if there is any correction or if I missed anything.

Company CEO/Chairman
ADAE Anil Ambani
Air Deccan GR Gopinath
Apollo Tyres Neeraj Kanwar
Ashok Leyland R Seshasayee
Asian Paints Ashwin Dani
AV Birla Group Kumar Mangalam Birla
AZB Partners Zia Mody
Bajaj Auto Rahul Bajaj
Bank of Baroda MD Mallya
Bharat Forge BN Kalyani
Bharat Petroleum Ashok Sinha
Bharti Enterprises Sunil Mittal
Biocon Kiran Mazumdar Shaw
Birla Corp RS Lodha
Bombay Dyeing Jeh & Ness Wadia
Britannia Vinita Bali
BSNL AK Sinha
Cadbury India Bharat Puri
Cipla YK Hamied
Cromptom Greaves Gautam Thapar
Dabur VC Burman
Dr. Reddy's Labs K Anji Reddy (Chairman)
Dr. Reddy's Labs GV Prasad (CEO)
EID Parry SM Datta
Essar Group Shashi Ruia
GAIL UD Choubey
Godrej Group Adi Godrej
Gujarat Ambuja Cement NS Sekhsaria, Suresh Neotia
HCL Technologies Shiv Nadar (Chairman), Vineet Nayar (CEO)
HDFC Deepak Parekh
Hero Group Brij Mohal Lall Munjal
Hinduja Group SP Hinduja
Hindustan Petroleum Arun Balakrishnan
HSBC India Naina Lal Kidwai
Hyundai India BVR Subbu
ICICI Bank Chanda Kochar
ICICI Prudential Shikha Sharma
ICICI Ventures Renuka Ramnath
Infosys Technologies Nandan Nilekani * Narayan Murthy (co founder and chairman), Kris GopalKrishnan (CEO)
IOC Sarthak Behuria
Ispat Industries VK Mittal
ITC Yogesh C Deveshwar
Jet Airways Naresh Goyal
Kotak Mahindra Bank Uday Kotak
Larsen & Toubro AM Naik
Mahindra & Mahindra Keshub Mahindra, Anand Mahindra
Maruti Udyog RC Bhargava
Microsoft India Ravi Venkatesan
Motorola India FV Vandrewala
Nicholas Piramal Ajay Piramal
Nirma Karsanbhai Patel
ONGC R.S. Sharma
Pantaloon Retail Kishore Biyani
Pepsi Co. Rajeev Bakshi
Ranbaxy Malvinder Singh Mohan
Raymond Gautam Singhania
Reliance Industries Mukesh Ambani
Reserve Bank of India Subbarao
RPG Group Harsh Goenka
SAIL SK Roongta
Satyam Computers Kiran Karnik(Chairman), A.S. Murthy (CEO)
SEBI Bhave
Shoppers' Stop BS Nagesh
Standard Chartered Jaspal Bindra
Star TV India Peter Mukerjea
State Bank of India OP Bhatt
Tata Group Ratan Tata
Tata Steel B Muthuraman
TCS S Ramadorai
UB Group Vijay Mallya
Videocon Industries Venugopal Dhoot
Wipro Azim Premji (Chairman), Girish Paranjpe & Suresh Vaswani (joint CEOs)
Yes Bank Rana Kapoor
Zee Telefilms Subhash Chandra
Hindalco Industries Kumar Mangalam Birla
NTPC R.S. Sharma
Oracle Financial Services Software (i-flex) Rajesh Hukku
Spicejet Sanjay Aggarwal

Wednesday, February 25, 2009

25February2009

Duty cut of 2%
Using every privilege it has to lure voters just before code of conduct for the next general elections is applicable, Finance Minister Mr. Pranab Mukherjee announced 2% cut in excise duty. This will be in addition to the 4% excise duty cut made in December and will continue in the next Fiscal. Note here that the duty cut is only for the items with current excise duty at 10%. There are other slabs with duty more than 10% and other at 4%, though these are not affected. But the items with 10% duty (which now will be at 8%) are 96% of all. So more or less this cut is across the commodities. There is 2% cut in the service tax as well, bringing it down from 12% to 10%. So we see cut in bills if the benefit is transferred to consumer. 

S&P Lower India Rating
Standard & Poor’s (S&P) lowered the outlook for India’s credit rating from stable to negative (BBB-) indicating higher possibility of a downgrade. The revision has increased expectations of a rate cut aimed at boosting sentiment. S&P’s revised outlook has came less than three weeks after it said India will be the second-fastest growing economy after China. But economy prospects and fiscal position are separate issues. India fiscal deficit was as high as 6% as against 2.5% expected budget deficit. Also with the current duty cuts (mentioned above) there will be higher fiscal deficit. Note here that on the same ratings (Long term debt, Local currency) some other countries stands as:
Pakistan: CCC+
Sri Lanka: B+
Kazakhstan: BBB
Israel: AA-
Jordan: BBB
Russia: BBB+
US: A+
Australia, New Zealand: AAA
China: A+
Hong Kong: AA+
Singapore: AAA
Argentina: B-
Brazil: BBB+
Venezuela: BB-
France, Germany, Ireland, Portugal, Netherland, Switzerland, UK, Sweden, Norway: AAA
Iceland: BBB+

SEBI clearance for Satyam sale
SEBI has laid the way for Satyam to issue preferential shares at a price which can be lower than what rules allowed till now. At present, the pricing of a preferential issue is based on the average price of the stock for two weeks or six months, whichever is higher, from the relevant date (which is 30 days prior to shareholders’ approval). This is now relaxed to two weeks average price.

Wednesday, February 18, 2009

National Rural Employment Guarantee Act

Introduction
  • Government of India under Prime Minister Manmohan Singh launched NREGA on 25th August 2005. 
  • NREGA aimed to provide work to people living below poverty line in rural India.
  • The NREGA provides a legal guarantee for one hundred days of employment in every financial year to adult members of any rural household willing to do public work related unskilled manual work at the statutory minimum wages
  • Central Government shall meet the cost towards the payment of wage, 3/4 of material cost and certain percentage of administrative cost. 
  • State Government shall meet the cost towards unemployed allowance, 1/4 of material cost and administrative cost of State council.
  • Adult members of rural households submit their name, age and address with photo to the Gram Panchayat. The Gram panchayat registers households after making enquiry and issues a job card. 
  • The employment will be provided within a radius of 5 km: if it is above 5 km extra wage will be paid.
  • TATA Consultancy Services, India's largest IT/ITES sector company has designed the software solution for the state of Andhra Pradesh. NIC, a government of India undertaking, developed solution has been implemented in other areas.
  • Wages paid would be through a saving bank account in local bank or post office. Government is trying hard to ban wages payment through cash.
Facts
Under NREGA, rural labourers have a legal entitlement not only to work on demand but also to minimum wages. To prevent corruption, a wide range of transparency safeguards has been built into the Act. For example, muster rolls are supposed to be kept at the worksite, displayed at the Panchayat Bhawan, and read out in public at the time of wage payments. Employment and wage details also have to be entered in the labourers’ 'Job Cards', to enable them to verify the records for themselves. Contractors are totally banned.
At the gram panchayat level, the main responsibility for implementing NREGA works lies with the Panchayat Executive Officer (PEO). Another key actor is the Village Labour Leader (VLL), who is supposed to be selected by the gram sabha for the purpose of 'supervising' a specific worksite.
VLLs were there with Sampoorna Grameen Rozgar Yojana (SGRY), a predecessor of NREGA. At that time, the VLL was a de facto contractor. He or she received the work orders, spent the funds, arranged the works, and filled the muster rolls. Under NREGA, funds are routed through the panchayat and the VLL is supposed to be a mere worksite supervisor, who earns wages at the same rate as other labourers.

Current Status of NREGA
  • Barely 3.2 per cent of the registered households could avail of 100 days of employment in one year '06-'07.
  • Average employment provided under the scheme was just 18 days in the same year block.
  • Rural population, even Government not aware of the scheme.
  • Discrepancy in muster roll prepared by the team leader.

Wednesday, January 14, 2009

14January2009

After a long gap, I am again back to update this blog. Long list of events happened since my last update:
1) Satyam Fiasco: A lot said and known already in all daily newspapers, channels. 
What happened actually? 
How and how much the Satyam books were cooked? 
Why the Books were cooked?
Why the fraud was accepted now? 
Who was benefitted? 
What was the role of PWC? 
What next?

2) Wipro banned by World Bank.
What happened? 
Whats industry practice?
Azim Premji's clearance.

3) Infosys Q3 results much better than expected. 

4) Inflation continue to roll down. Now less than 6%. 

I will proceed from here tomorrow onwards!