Kalia_Test Posted August 23, 2015 Posted August 23, 2015 not sure if this is the right time to be dis-investing.... Why? I know markets are down a bit last couple of weeks but this is not like divesting in a great bear market ( market top was 9000+ on Nifty and we are at 8300 odd now - par for the course ). Surely Govt. can't act like greedy promoters ( and then there are SEBI guidelines on last 6 months closing price,etc - so the price reflects good times too ). Maybe you had something else in mind other than market conditions. Can you kindly elaborate?
G_B_ Posted August 23, 2015 Posted August 23, 2015 Why? I know markets are down a bit last couple of weeks but this is not like divesting in a great bear market ( market top was 9000+ on Nifty and we are at 8300 odd now - par for the course ). Surely Govt. can't act like greedy promoters ( and then there are SEBI guidelines on last 6 months closing price,etc - so the price reflects good times too ). Maybe you had something else in mind other than market conditions. Can you kindly elaborate? Its the floor rate they have. Plus the 5% discount. Works out to a PE ratio as per Bloomberg of about 8 or something. That is low...especially in emerging markets. Unless they want to send a signal to FIIs that there is demand for Indian equities... I see this more as a move to pacify investor disappointment due to lack of reform.
Kalia_Test Posted August 23, 2015 Posted August 23, 2015 Its the floor rate they have. Plus the 5% discount. Works out to a PE ratio as per Bloomberg of about 8 or something. That is low...especially in emerging markets. Unless they want to send a signal to FIIs that there is demand for Indian equities... I see this more as a move to pacify investor disappointment due to lack of reform. OK. Fair enough. From equitymaster it is trading at TTM ( Trailing Twelve months PE of about 12 odd ) - https://www.equitymaster.com/result.asp?symbol=IOC&name=IOC-Stock-Quote-Chart&utm_source=top-menu&utm_medium=website&utm_campaign=performance&utm_content=get-quote Now what value would you give to a company that has 1) No control on input raw material ( crude )price and 2) Extremely limited price control on output price ( petrol, diesel ) and owned by Govt ( and no guarantee whatsover if any future Govt will take-back whatever limited de-regularization of petrol-diesel prices there is ). One big hike in Oil ( crude ) prices and subsidy will start again in some manner - even under Modi sarkar ( we know how things work in India - Oppn will kill it if Petrol,diesel is not 'affordable' ). Why will you even pay 12 PE for a company operating in such environment? P.S - 1) British Petroleum trades at 8.7 PE ( as per earnings in 2014 ) and it is into refining,etc and owns assets too unlike IOC which is predominantly distribution ( i.e buys from refineries and sells in its retail outlets with very limited upstream contribution ). 2) Emerging does not mean high P/E or high P/BV. Public sector Banks are usually always below BV even during bullish phases. The consumption,Pharma, Private Banking, IT, select Telecom/Infra stocks are the ones that command good multiples. 3) I am sure you know that Power sector ROE in India ( for generation, distribution and transmission - luckily not for Private Power equipment manufacturers) is capped at 14%. Why would you even invest in PSU Power sector companies like Power Grid, NTPC,etc when you know that these companies cannot ( by law ) make more than 14% Return on Equity unless there is a special situation like OFS with discount? Companies like HUL, Nestle,etc have > 100% ROE IIRC
G_B_ Posted August 23, 2015 Posted August 23, 2015 OK. Fair enough. From equitymaster it is trading at TTM ( Trailing Twelve months PE of about 12 odd ) - https://www.equitymaster.com/result.asp?symbol=IOC&name=IOC-Stock-Quote-Chart&utm_source=top-menu&utm_medium=website&utm_campaign=performance&utm_content=get-quote But thats the thing. Yes they dont have control on raw material but there is still a demand right? some sort of stable demand. People still need oil. Even majors like Shell etc dont really have much control over the raw material. The government will still be owning Indian oil with more than 50% stake right? Just like PSU banks they will pump in money is need be. Works both ways Ie Indian oil is restricted but safe. Its a risk you have to take. Even a forward PE of 12 seems like a good investment to be honest. But the risk you take is oil prices wont spike too much and will be below 100. P.S - Thats more to do with the disaster in the Gulf of Mexico for which they were levied a record fine. The likes of Exxon are (or appear to be) in much better shape. I understand that, but what is the sectoral forward PE. The sensex one year forward PE i think stands in between 16-17. So why the buzz during the time of coal India during their IPO. Its a serious question. Not trying to be rhetorical. At the very least there was no need for the 5% retail investor discount....
Kalia_Test Posted August 23, 2015 Posted August 23, 2015 1. Demand means nothing when you have no control over your prices. Extreme example I know but if iPhone ( latest ) comes at 30K, there will be extreme demand. Does not mean it is profitable. Commodities like Oil will always have demand. 2. If investors have to depend on Govt. pumping more money, then the P/E multiple reduces. Fact anywhere in world. 3. Sensex is not the right index for comparison IMHO. Sensex has lot of Pharma, IT, Private Banks,etc which are way > 20 times forward PE. It is not the right comparison for IOC IMHO. 4. On Coal India - same issue. Same Govt. controls. Still Retail investors made very good money due to discount and it was IPO ( not further divestment of an already listed company where we have some price yardstick ). Point I am trying to make is simple - this is as good a time for divestment as any. Regular market movements are par for course ( I will fiercely oppose selling national assets during extreme bear markets ). Retail investors getting 5% discount is welcome as it 1) Encourages retail participation in equities ( which is abysmally low compared to developed countries ) 2) Somewhat insulates extreme volatility by having tradable shares not concentrated among institutions. 3) Encourages the real purpose of divestment. Indian citizens need to benefit. While most of it is supposed to be due to the money raised by Govt and utilized in its schemes, a miniscule amount is directly given to retail investors via discount. This will again feed into Economy. Again - my intention is not to argue with some very valid points raised - just that I feel this is as good a time as any :two_thumbs_up:
amiret Posted August 24, 2015 Posted August 24, 2015 RBI Governor schools the Govt : Aug 24 2015 Interest rate cuts should only be delivered after sustained low inflation, and not as "goodies" doled out after public pleading, Reserve Bank of India Governor Raghuram Rajan said on Monday. "Rate cuts should not be seen as goodies that the RBI gives out stingily after much public pleading," Rajan said in a speech to a banking event. "Instead, what is important is sustained low inflation," he added. "And rate cuts are a natural consequence that the RBI has no hesitancy in delivering." The comments come as corporate executives and Finance Minister Arun Jaitley is stepping up pressure on the RBI to cut rates as the economy struggles and price rises slow. http://in.reuters.com/article/2015/08/24/india-rbi-rajan-rates-idINKCN0QT0EV20150824
amiret Posted August 24, 2015 Posted August 24, 2015 modi Govt to give Tax relief to Foreign institutional investors (FIIs) : Foreign institutional investors (FIIs) may not have to pay minimum alternate tax (MAT) on capital gains made by them prior to April 1, 2015. The government is considering giving relief to FIIs from MAT, an official source said here. “The AP shah committee had recommended giving relief to FIIs from MAT. The government is favourably considering it,” the official added. In an attempt to assuage fears of foreign investors, the government had formed the panel and the income tax department had directed its officials to put on hold issuance of fresh notices and any further assessments on levy of this tax on FIIs. Good move by modi govt , to not burden the FII's with unnecessary Taxation. LINK
G_B_ Posted August 25, 2015 Posted August 25, 2015 Those of you searching for your posts about Pak-India NSA talks, they have been moved to the stickied thread on foreign affairs. Sorry for the inconvenience.
diga Posted August 28, 2015 Posted August 28, 2015 Monsoon below normal :(( As the season enters its final phase, the forecast of a below-normal monsoon made by the India Meteorological Department (IMD) has come true with the rainfall deficit standing exactly at the 12 per cent it has predicted. Private forecaster Skymet, which had forecast a normal monsoon, concedes that with the season nearly done, the rainfall is not likely to increase. “The country-wide cumulative rainfall [deficit] figure now stands at 12 per cent. The daily average rainfall figure will start taking a dip after a couple of days. Thus, we can expect that this [the average rainfall] figure will not rise much,†Skymet said on Wednesday. The IMD says the southern peninsula and central India have been the worst hit, with rainfall 20 per cent and 15 per cent below normal, respectively. Northwest India, east and northeast India received 6 per cent less.
Khalpat Posted August 28, 2015 Posted August 28, 2015 Public Debate in India is too wholesale. Those who support government, support all its choices, and those who oppose government, oppose all its choices.
sticky wicket Posted August 31, 2015 Posted August 31, 2015 Big economic numbers out today....but new GDP methodology still being questioned...which is rather ridiculous considering several experts saying the new methodology is inline with international accepted method.
amiret Posted August 31, 2015 Posted August 31, 2015 Big economic numbers out today ...but new GDP methodology still being questioned...which is rather ridiculous considering several experts saying the new methodology is inline with international accepted method. The methodology may be inline with international standards but the GDP figures are not comparable to the past unless the back series data is made available . In the words of the Chief Statistician of India (CSI) and Secretary, Ministry of Statistics and Programme Implementation , TCA Anant " It is entirely possible that 5% growth rate in the old series is qualitatively in the same ballpark as 6.5% or 7% in the new series. It is possible. I don't know," 5% during last 2 years of MMS could be qualitatively similar to the 7% being claimed now ? 4.7 % of 2013-14 has been revised to 6.9%. "Don't compare new GDP data series with old" : April 14th 2015 New Delhi: Chief statistician TCA Anant, ..... said it would be possible to make meaningful conclusions only when data for previous years is made available. "Once the back-series is worked out and understood, only then-...higher growth rates relative to the past become meaningful," Anant said at a conference called by the Central Statistics Office on Monday to dispel doubts about the new numbers. Even the IMF found some discrepancy in the new numbers and they sent a team to India to study the numbers a few months ago.
The Outsider Posted August 31, 2015 Posted August 31, 2015 Big economic numbers out today....but new GDP methodology still being questioned...which is rather ridiculous considering several experts saying the new methodology is inline with international accepted method. Yeah it's ridiculous that the current RBI governor, who has studied at IIT, IIM, Sloan and teaches at Chicago cannot understand what's going on with the GDP calculation. As he said, an economy growing at the rate projected is going gangbusters and doesn't need rate cuts. Hum minions ko baad mein samajh aayega GDP calculation, first explain it to the RBI governor.
amiret Posted September 1, 2015 Posted September 1, 2015 Just 17 individuals have Rs 2.14 lakh CRORES as outstanding tax arrears, with each of them owing more than Rs 1,000 crore. Minister of State for Finance Jayant Sinha in Rajya Sabha in early Aug : "However, a large proportion of these demands may not be collectible" as the demand has been raised in March, 2015 and has not fallen due or the demand may have become difficult to recover," the minister added. Why has it become difficult to recover ? :hmmm: "difficulty" is a feeble excuse for modi Govt's incompetency and spinelessness . This is more than double the amount of total tax dues worth Rs 90,568 crore outstanding against 35 companies in this category (with outstanding tax arrears of over Rs 1,000 crore each), the Parliament has been informed. Together, these individuals and companies account for more than one-third of the overall direct tax arrears (including the demand not fallen due), which stood at Rs 8,27,680 crore, as of April 1, 2015. LINK
G_B_ Posted September 4, 2015 Posted September 4, 2015 Indian economy will continue to outperform peers: Atsi Sheth, Moody's Read more at: http://economictimes.indiatimes.com/articleshow/48792119.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
Tiger80 Posted September 4, 2015 Posted September 4, 2015 Haryana to emerge most favoured FDI destination: Khattar http://timesofindia.indiatimes.com/good-governance/haryana/Haryana-to-emerge-most-favoured-FDI-destination-Khattar/articleshow/48665392.cms?
Kalia_Test Posted September 4, 2015 Posted September 4, 2015 Nearly 1.65 lakh account holders avail overdraft under Pradhan Mantri Jan Dhan Yojana NEW DELHI: The government today said nearly 1.65 lakh Jan Dhan account holders, of the total 18 crore accounts opened under the scheme, have availed overdraft facility. More than Rs 22,000 crore have been mobilised under the Pradhan Mantri Jan Dhan Yojana (PMJDY) and 15.74 crore Rupay debit cards have been issued, Finance Ministry said in a statement. "Now, the focus of PMJDY has moved from account opening to the provision of cash-out facilities at an approachable distance to reap the real benefits of PMJDY," it said. "In this regard, Indian Banks Association (IBA) has been asked to issue revised guidelines to all banks. Overdraft facility has been availed by 1,64,962 account holders as on September 1, 2015," the statement added. "The achievement under PMJDY is heading towards saturation. Initial demand for bank accounts was expected to be around 7.5 crore. However, so far close to 18 crore accounts have been opened," it said. Excellent news - Financial inclusion is not just a fancy word. Concrete steps have been taken and results are also evident :nice: randomGuy 1
amiret Posted October 14, 2015 Posted October 14, 2015 (edited) How Modi govt’s infrastructure splurge is reviving investment Prime Minister Narendra Modi’s bet on higher public spending to spur economic activity has started paying off, as capital investment in the country shows signs of sustained revival after years of uneven growth. But corporate spending is still tepid and federal revenues remain stressed, raising the risk of another false dawn for Asia’s third largest economy as it tries to recover momentum.At the risk of inviting the wrath of investors and ratings agencies, the NDA government loosened fiscal deficit targets in this year’s budget to double spending on roads and bridges.Since April, public capital spending has clocked healthy growth of nearly 19% on the year, compared with a fall of 1.4% in the corresponding period last year. .The government reckons economic growth could increase by at least a percentage point if its departments don’t underspend."Overall, the industrial production data indicate that despite slowing external demand, the domestic growth cycle is improving,” said Sonal Verma, an economist with Nomura. Tax and spend ; those giant Keynesian ditches won't fill up by themselves. Edited October 14, 2015 by amiret
amiret Posted October 15, 2015 Posted October 15, 2015 IMF-World Bank : Poverty in India in 2011-12 was significantly lower than Govt estimates of 21 % ?"The World Bank said improved infrastructure, specifically rural electrification, has had far-ranging effects, changed earnings, consumption and even encouraged schooling for girls."India has reduced its poverty rate to 12.4% from the 2011-12 estimate of 21%, according to new data released by World Bank,which identified rural electrification as an important driving factor for everything from greater rural spending to schooling for girls.“Rural electrification in India has caused changes in consumption and earnings, with increases in the labour supply of both men and women, and promoted girls’ schooling by reallocating their time to tasks more conducive to school attendance,” said the Bank. “Investment in integration and connectedness through railroads in India helped reduce the exposure of agricultural prices and real income to rainfall shocks, and helped diminish the famine and mortality risks associated with recurrent weather shocks.”The World Bank has used the monthly per capita expenditure data released by the Ministry of Statistics and Programme Implementation to estimate how many Indians are poor....higher expenditures, combined with a high population density around the poverty line, translate to a significantly lower poverty rate of 12.4% for 2011-12,” the report said. http://www.business-standard.com/article/specials/india-s-poverty-rate-falls-to-12-4-electricity-plays-big-role-115101000180_1.html
diga Posted October 26, 2015 Posted October 26, 2015 So why will anybody invest if there is a possibility of anarchy & unrest in India? dial_100 and adi B 2
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