Showing posts from February, 2008

Sponsor a Business

Found an article which just goes to show the extent to which entrepreneurial spirit is ingrained in Indians, and how we can device innovative ways to help them:
Dear Friends,This is one of the better ventures I have come across, leveraging the power of community to empower entrepreneurs.Its a matchmaking project, connecting entrepreneurs who need loans with lenders who can offer loans.If an entrepreneurs needs Rs. 50,000 as loan, he can receive it from multiple lenders , maybe in smaller chunks of Rs. 5000 each. Similarly a lender can spread his loan of Rs. 2 Lacs, across maybe 10 or 20 businesses.Last week statistics revealed on the site are inspiring to know, the model seems to be clearly working.Close to 4000 lenders have joined, 1400+ entrepreneurs have been funded collectively amounting to Rs. 2.5 crores.This idea needs to spread fast, it is currently being positioned to help poor people with a zeal to do business, but who lack basic resources.To ensure that the people do not misu…

Think twice before investing in IPOs

An economic times article:

Ten out of 16 initial public offerings (IPOs) that made their debut on the bourses this calendar year are quoting below their issue prices, a statistic that is likely to make investors think twice before rushing to put money into the next ‘hot IPO’. But merchant bankers are not to be dissuaded so easily. They feel the primary market is showing signs of a revival, only that investors have become a bit more finicky about the price they are willing to shell out.

“People are coming back but at a price,” said an investment banker with a leading domestic brokerage. “Unlike the earlier trend of where any issue was oversubscribed, there is an element of caution today. In a highly volatile market, most investors prefer secondary market trade rather than primary market trade,” he added.

Industry experts aver the new issuances and their performance on the bourses in the recent past also need to be judged against the backdrop of whether the deal was announced before …

Why I Am Very Bullish On Gold

I monitor some blogs which i feel give interesting perspectives on economy and / or the stock market. Found this article on one such blog. Makes sense, doesnt it?

Not really the ten reasons, but one step at a time. So the US economy is crapping out. Big deal? Yessir, very big deal. Dollar hits big time lows. What happens then? Look, a lot of us Asian Economies including the guys who have lots of oil and desert, have our bloody reserves in dollars. Ok? And if you flush the dollar down the toilet like the US is most likely to do with some grandslam rescue attempts to save some lousy bond insurers, we Asian Economies don't know what the frick to do with our reserves. Oh you small little Asian Economies you say. Dude, get real. This is a huge deal, a few trillion dollars. China has some 1.5 trillion, Saudi Arabia has about 800 bn, and with Korea, Singapore, India etc. I think we'd top the 3 trillion mark. Don't even count Japan. So what reserve currency if not the dollar?…

World’s Top Hedge Fund Renaissance Technologies Sets Up Shop In India

Here is an interesting development for the Indian capital markets. One of the world’s largest hedge funds - Renaissance Technologies (see the Wikipedia entry)- has set up shop in India as a foreign institutional investor, Business Standard reports. The New York based fund has received the approval from the capital market regulator SEBI. The entry of Renaissance comes after SEBI invited global hedge funds to directly come to India rather than using participatory notes to invest in Indian capital markets. Following this move, SEBI has registered around 200 foreign institutional investors in the last two months, and out of them at least 20 are large hedge funds.
Renaissance, which manages over $30 billion, is a global hedge fund management firm with a track record of producing “superior returns” for its clients using mathematical and statistical methods in the design and execution of its investment programs, the company’s website says. It employs more than 260 employees, mostly scientists…

Investors need to get back to basics of value picking

An article in ET says:

It is nature’s way that every spring is followed by autumn. Investors are finding out that the stock market is no exception to this rule. After four years of unchallenged stampeding on D-Street, the bulls have been forced to retreat by the resurgent bears.

The questions that both market experts and retail investors seem to be asking are: Is this the beginning of a bear market? How long will it be before the bulls are seen on the horizon again? The truth is that there are no clear-cut answers and the future, as of now, is up in the air. What is obvious, though, is that investors are unlikely to see their investments growing as fast as they have grown in the past four years. So, does this mean that it is time to stay away from the market?

Not quite. While the days of making easy money and double-digit returns within a few months in the market may be over, there is still scope to generate good returns on investments. For that, though, one has to forget about…

Wasting Public Money

“Will the Indian mind ever get decolonised?” is the question that R Vaidyanathan asks at the end of his column titled “The colonial conquest of India by Cambridge varsity” in DNA today. (Hat tip: Raja Shekhar Malapati.) It is about the government of India giving Cambridge University Rs 26,00,00,000 (US$ 6,500,000) to support the ‘Jawaharlal Nehru Professorship of Indian Business and Enterprise.’ That professorship is to mark the centenary of Nehru’s arrival at Cambridge.

It is nothing that Cambridge will get excited about, however, since it has an estimated US$ 5 billion in endowments. The Rs 26 crores the Indian government forked over amounts to around 1,000th of that. But Rs 26 crores would have funded a hundred schools in India, perhaps making a difference in the lives of thousands of children, and directly and indirectly providing employment to thousands of people desperately in need of a living income.How we spend money depends crucially on two factors: whose money is being spent …

The Smartest Unknown Indian Entrepreneur

Found this on the Forbes site... The article has been written by Sramana Mitra who is a technology entrepreneur and strategy consultant in Silicon Valley. She has founded three companies and writes a business blog, Sramana Mitra on Strategy. She has a master's degree in electrical engineering and computer science from the Massachusetts Institute of Technology.

Entrepreneur Marc Benioff is afraid of him. Venture king Mike Moritz wants to invest in him. You have never heard of Sridhar Vembu, founder and CEO of AdventNet, the company behind newly launched productivity suite Zoho.Vembu is a low-profile guy if there ever was one. He is also cheap as hell. Yet, of course, you know that among entrepreneurs, frugality is a virtue. A tremendous virtue.Vembu has stretched this virtue to extreme limits, and added layers and layers of creativity upon it. The result? A 100%, bootstrapped, $40-million-a-year revenue business that sends $1 million to the bank every month in profits. Doing what? y…

Comparing Dhoni With Mukesh Ambani, Why Stop There?

Came across quite an interesting article which just goes to show how news is made where none is present. :)

Economic Times proves that Statistics is like a bikini: it hides more than it reveals. Dhoni, they say, gets paid more than Mukesh Ambani. The chief executive officer of the Men-In-Blue Mahendra Singh Dhoni, who has been bagged for Rs 6 crore for the domestic cricket league, has overtaken Mukesh Ambani, chief of India’s largest private sector company, in terms of compensation. The comparison is not apt but on a per hour basis Dhoni will be paid more than Mr Ambani for the duration of the tournament. ... Yes, they have disclaimed that this does not include dividends that Mukesh Ambani receives or the other endorsement/team revenue that Dhoni gets [these figures are not comparable]. To give you an idea of what is not included, Ambani's dividend from RIL alone, through his 70 odd crore shares, is nearly 800 cr. per year. I doubt Dhoni makes that much from his endorsements …

The IPL - Gloassary: The Basic Know-How..

What is the Indian Premier League?
The Indian Premier League (IPL) is a franchise-based Twenty20 competition organised by the BCCI, and it has official sanction since it has the backing of the ICC. It features the world's best cricketers playing - their affiliation decided by open auction - for eight city-based franchises, owned by a host of businessmen and celebrity consortiums. The inaugural edition of the tournament will run from April 18 to June 1.

What are the logistics of the IPL?
The tournament will begin on April 18, when Bangalore take on Kolkata at the Chinnaswamy Stadium in Bangalore. The tournament will feature 59 matches in total, the teams playing each other on a home-and-away basis. Click here for the full list of fixtures.

Why is the IPL generating such a buzz?
Two main reasons why. One the football-club concept of the IPL, which is unlike anything cricket has known. The best players from across the world playing not according to nationality but according to market forc…

Recently listed stocks plunge below offer price

With the bears taking over Dalal Street in recent days, many recent offerings which listed at considerable premium are now trading at a significant discount to their offer prices.

Reliance Power listed at Rs 547.80, premium of 21.73 per cent against the issue price of Rs 450 on Feb 11. But the stock was unable to hold the gains and closed at Rs 372.50 on the same day. The stock hit a low of Rs 332.50 on Feb 13 and high of Rs 599.20 on Feb 11. Today R Power shares closed at Rs 408.20 on BSE.

Similar is the case with many IPOs that listed this month. On Feb 1 Future Capital Holdings listed at Rs 1,044, a premium of 36.47 per cent against the issue price of Rs 765. It closed at Rs 908.20 on the listing day. The stock touched a low of Rs 803 on Feb 14 and high of Rs 1,190 on Feb.7. The stock today closed at Rs 822.55 on BSE.

On Feb 13 Cords Cable listed at Rs 130, discount of 3.7 per cent against the issue price of Rs 135. It closed at Rs 138.30. The stock hit a high of Rs 155.6 on…

Solo Telecom Tower Companies To Follow Coalition Dharma

The telecom tower business is not for weak-kneed. If you are a solo tower venture, the business is unlikely to take you anywhere unless you are big enough (a la American Tower Corp). The minnows of the Indian tower industry are joining hands to pad them up against other biggies like Bharti Infratel, Reliance Infratel, the Bharti-Vodafone-Idea combine Indus Towers or even Tata’s yet-to-be named tower company.
How do the stand alone tower companies such as Essar Telecom Tower & Infrastructure, GTL, Quipo, Xcel telecom, and TowerVision stack up against them? They do not have a chance individually, so are planning to consolidate their businesses to compete with the biggies, according to a report in The Economic Times.
The Indian telecom sector is the fifth largest and one of the fastest growing in the world - probably just after China. The market is large enough for accomoodating multiple tower companies, but if the company is not large enough then they can miss the market opportunity, …

To invest or not to invest in REC IPO?? Presenting a SWOT Analysis..

The REC IPO has already been subscribed fully. Sensible companies will always have a market because this IPO has being priced very attractively. This company lends largely to the power sector projects, especially to the transmission and to the generation space of it. It also mainly participates in the rural power generation projects.

If one takes a look at what this company is likely to do, there is a whole host of business opportunities waiting for it. This company may be looking at putting in USD 592 billion in the 11th Power Plan that the government has laid out - about 15-20% of the total outlay in the 11th Plan will be fully funded by REC. So the company has been growing about 23% CAGR from FY04-FY07 and from here to FY10, they are likely to grow in a CAGR of 20-21%; as per CNBC-Tv18 analysis.

But one biggest concern of this company has been, the spread that they get it on. The biggest positive for REC hs been the cost of funds that they have been able to raise largely because of f…

Rs15 cr probe into why we believe in God

A research team at the University of Oxford will be shelling out �1.9 million (about Rs 15 crore) to find out the reason behind why people believe in God.The Oxford academics have been given a grant to try to discover whether belief in a deity is a matter of nature or nurture.The team said they would not examine the question of whether God exists but will look at evidence in an effort to prove whether belief in God bestowed an evolutionary advantage to mankind.They added that they would also judge the possibility that faith developed as a by-product of other human characteristics, such as sociability.Researchers at the Ian Ramsey Centre for Science and Religion and the Centre for Anthropology and Mind in Oxford will use the cognitive science disciplines to develop 'a scientific approach to why we believe in God and other issues around the nature and origin of religious belief'.'We are interested in exploring exactly in what sense belief in God is natural. We think there is…

How to tackle volatile markets? A few tips

"Neither a man nor a crowd nor a nation can be trusted to act humanely or think sanely under the influence of a great fear...To conquer fear is the beginning of wisdom". - Bertrand Russell, British mathematician and philosopher. The above is applicable to all parts of life, especially when you are an investor in the equity markets. The last few weeks have amply demonstrated how investors, whether institutional, retail and even the veteran reacted to the sharp fall in the stock markets. The same people were bullish, not so long ago, turned bearish at the advent of a technical correction. And that too, after expectations for more than a while that the markets needed to correct. Just a few weeks ago, people from all over the country were going berserk in their attempts to open a demat account because they wanted to participate in the Reliance Power IPO. Two days post-listing, there are few takers for the scrip. Investors, who were hoping for huge listing gains are now left lic…

10 good construction stocks to invest in

Mega investments in infrastructure and the recent market correction offers an exciting investment opportunity in construction stocks.The robust GDP growth rate experienced by the country in the last few years is indeed commendable and was aided by investment in infrastructure. To sustain growth rates, it is imperative for India to make higher investments towards setting up world-class infrastructure.
As per the Planning Commission estimates, investments in infrastructure is set to go up by a whopping 130 per cent to $520 billion for the eleventh Five-Year Plan (FY 2008-12) as against the $226 billion made during the 10th plan (FY 2003-2007). Construction companies will be among the first beneficiaries of these investments and will deliver good and sustainable long-term growth. Since the investment plans for each of the sub-segments in infrastructure space varies, based on priorities, there is reason to believe that not all the segments or companies will grow at all times. For instance…