After witnessing a stellar rally in the month of Jan 2012, markets have continued the robust performance into the month of Feb.
The Indian markets again saw a sharp turnaround, moving from negative to positive within the last trading session. NTPC emerged as the top gainer for the day, gaining 2.71%.
Indian markets have opened on a flat note today. The Sensex and Nifty are both seen trading marginally down.
FMCG major Marico has posted a better than expected Q3FY12 performance with 29 per cent rise in topline and 21 per cent rise in bottomline. We expect the counter to continue its robust performance goind forward.
ACC and Ambuja Cement, the largest cement producing companies in India have reported decent uptick in the dispatches for month of Jan 2012, which have grown by 4.18 per cent and 8.78 per cent on a YoY basis respectively.
Desptie weak Q3 perfromance, the business outlook of GSFC remains strong and buoyant.
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A few years ago, it was fashionable for foreign institutional investors (FIIs) to be part of India's growth story. Now, the situation has reversed, and it is probably more fashionable for them to remain outside India. Last year (in 2011), FIIs withdrew a net Rs 2714 crore from the Indian equity market. The reasons for such apathy of the FIIs towards India are both economical and political. This indifference of the FIIs isevident from the latest fund manager (FM) survey by Bank of America- Merrill Lynch (BoA ML), which shows that just when it seems that investors cannot reduce their allocation to India any further, they actually do: 61 per cent of the emerging market (EM) fund managers polled were underweight on India,
In its recent report, the World Bank has cut its forecast for growth in the global markets. The bank has clearly stated that there is a slowdown in the Euro zone, which will impact emerging markets like India and Mexico. It has predicted that the world economy will grow at around 2.5 per cent this year as compared to its earlier estimate of 3.6 per cent made in June 2011. This is a point of concern that may negatively impact the markets. Though, the rupee which has started appreciating now, and the government’s move to allow 100 per cent FDI in single-brand retail and a consideration of 49 per cent FDI in the aviation sector are steps that may have some positive impact on the markets. Currently, we are in the middle of the earnings season. At present, I do not think that India Inc’s Q3 FY12 results will be very good.
It is quite common to see investors putting in money without determining their investment goals and deciding the right asset allocation. As they focus mainly on performance, other important aspects of portfolio building such as diversification and asset allocation do not get due attention. However, the fact is that asset allocation not only reduces risk but also helps in optimising returns on a risk-adjusted basis. If you want to be a successful investor, you must first decide the asset allocation and only then select investment options. Asset allocation is an investment strategy that allows an investor to choose among various asset classes such as equities, debt, real estate and commodities. Simply put, asset allocation as a method of investing is an integral part of an investor's financial planning process.
IT bellwether, Infosys, recently announced its Q3 FY12 results. At Rs 41.50, the EPS for Q3 FY12 not only exceeded the company's own estimate of Rs 39.20, but was also ahead of street estimates. However, despite the better-than-expected performance of the company, the scrip witnessed a sharp decline on the bourses. The reason behind the sharp fall was the disappointing guidance provided by the company for Q4 FY12.The worrisome factor was Infosys' commentary, which clearly indicated deterioration in the business environment going forward. Citing reasons like a slower budget closure process, cautious clients especially in the European region, a delay in project ramp-ups and choppy spending by clients, the company reduced its dollar revenue growth forecast for FY12 to 16.4 per cent as compared to the 17.1-19.1 per cent growth it mentioned during Q2 FY12.
Inflation is at an all-time high these days. As a result, the cost of living has soared and the prices of essential commodities too have peaked. One element that few people tend to think about while considering inflation is the impact rising inflation has on one's insurance needs. While the rule of thumb states that you should look at a life cover of around 10 times your annual income (after deducting your investment assets plus any liabilities), it is also important to consider the impact of increasing inflation on your insurance portfolio. Inflation refers to the general rise in prices measured against a standard level of purchasing power. The most wellknown measures of inflation are the Consumer Price Index (CPI), which measures consumer prices, and the GDP deflator, which measures inflation in the domestic economy.
The RBI has finally made its intentions a little clear about the likely interest rate scenario that could pan out in 2012. At its meeting held on 24th January, 2012, it brought down the CRR by 50 bps, which means a boost to liquidity and in turn, to the markets. Having commenced the year on a strong footing, the reduction in the CRR came in as a booster shot for the market, which went up sharply to close yet another fortnight (11th January-24th January, 2012) on a positive note. The broader market was up by five per cent over the fortnight. As has been the trend so far in the year, stocks across the board have been participating in the rally. Mid- and Small-Cap stocks performed in sync with their larger counterparts. The BSE Mid-Cap Index was up 5.20 per cent, while the BSE Small-Cap Index rose by 4.32 per cent over the fortnight.
I am grateful to you for sending me a copy of the latest issue of Dalal Street Investment Journal, featuring Infosys on the cover. It is a good story. Thank you for your kind words. N R Narayana Murthy - Chairman & Chief Mentor, Infosys
Dalal Street Journal is the foremost journal for the intelligent investor and I would like to wish you and the magazine continuous success. M H Ashraff - MD, Tata Coffee
Your magazine is a very useful and interesting one. I am sure that it is fulfilling a very important task. My good wishes for the success of the magazine. Basant Kumar Birla - Chairman, Kesoram Industries
We thank you on behalf of all the employees and staff of Videocon Group for highlighting our efforts. We are very inspired by this cover story to rededicate ourselves to our commitments. P N Dhoot - President, Videocon International
The cover story, Rush for Real Estate IPOs, makes for interesting reading. Please keep it up. Pradeep Jain - Chairman, Parsvnath Developers
We, at Tata Chemicals are very happy to know that we have been ranked at No. 9 and I do hope we can soar to even greater heights. Prasad R Menon - Managing Director, Tata Chemicals
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