Indian Equity Research and Investment Strategy
I thought of sharing this article which is nothing but my own independent study [papers, photocopies from magazines etc] on ULIPs and why I gave a slip to them.
I have a simple rule of not to mix investment with life risk coverage. It is easy to get lost that ULIPs have triple advantage of Life Cover + Critical Illness Cover + Benefit of Aggressive returns offered by the Equity Markets. Lets analyze each of (more…)
Q4FY09 has been extremely lacklustre for Anantraj Industries (Anantraj) as it did not sell any property during the period. The company reported revenues of Rs153.2m, a decline of 92.9% YoY. Revenues for the quarter consisted of sales from its ceramic division as well as rental income. The company’s rental income increased from Rs33.5m in Q3FY09 to Rs50m. This was primarily an account of its Karol Bagh mall property. Other income for the company was quite robust at Rs216m on account of its large cash balance of Rs7.4bn.
Anantraj’s balance sheet position is strong as cash on its books (as on March 2009) stands at Rs7.4bn. The company’s debt stands at Rs1.21bn. This gives the company greater scope to utilize its cash and further leverage its balance sheet for acquisition of land and property at attractive values.
Anantraj is currently working on its Manesar project which has already started accruing rentals. The Karol Bagh project is also complete and has started contributing to rentals. Besides these two projects, the company has been focusing on certain hotel projects
Earnings forecasts are being upgraded globally and the trend is visible in India too. However, analysis of consensus aggregates suggests that revisions are mostly for 2010 while 2009 index EPS is at the same level as it has been since February 2009.
While projected 2009 EPS is still 7% below the EPS two years back in 2007, the forecast for the rebound in 2010 is only for 20% EPS growth. In other words, projected 2010 ROE is well short of 19% versus over 21% achieved in peak economic years like 2007. (more…)
On the back of the FDA’s product seizures at Sun’s US subsidiary, Caraco on June
25th, Analysts across the street have lowered revenue and earnings estimates by 8-10% across FY2010E-2012E to reflect the impact on Sun’s US sales. (more…)
The much awaited monsoon is now likely to be three weeks late and will be below normal compared to the long term average. The development may slowdown recovery of the Indian economy, which, otherwise has been rather rapid than in most of its peers.
According to the Indian Meteorological Department (IMD), 2009 monsoon rainfall would be 93% of the long-term average, lower than an earlier forecast of 96%. Even worse part of the development is that the north-western region, which includes India’s food-basket region of Punjab and Haryana, could be the most affected one.
The agriculture sector accounts for 17% of the gross domestic product (GDP), and more importantly, provides livelihood to more than 60% of India’s 1.1 billion plus population.In this wake, current year’s monsoon becomes even crucial for the economy as buoyant rural consumption has been a key driver of growth during the economic downturn. Even the partial failure of monsoon can result in significant decline in farm income, which will hit rural demand. Further, while the country has sufficient food stocks to tide over any crisis, the macro economic situation may worsen further with food inflation rising even higher from the present levels of close to 9%.
Another calamity of the delayed rain would be power availability in the country. Summer months are the peak power demand months due to greater demand from both the domestic and the farm sectors. However, delay in rains will lower the electricity production, thus raising the supply-demand gap in energy availability.
The overall impact of poor monsoon on agriculture, industry and broader economy can be substantial. If there are choppy rains this season, it will bring down the newly found momentum in economy and the GDP growth for the present fiscal, which is expected to range between 6.5-7% may fall down to 5% or even lower levels.
Oil & Natural Gas Corporation (ONGC) has announced its results for the quarter & year ended March 31, 2009.
The company has posted a net profit of Rs 2,206.76 crore for the quarter ended March 31, 2009 against Rs 2,627.10 crore for the quarter ended March 31, 2008, down 16%. The total income for the quarter has decreased to Rs 15,113.13 crore from Rs 17,659.78 crore reported in corresponding quarter of the last fiscal, registering a 14.42% fall.
For the entire fiscal the state-run company has posted a net profit of Rs 16,126.31 crore against Rs 16,701.65 crore in the previous fiscal, down 3.44%. The total income for the fiscal has showed a moderate growth of 6.20% to Rs 68,769.29 crore from Rs 64,752.24 crore reported in FY08.
On a consolidated basis, the Group’s net profit has dipped marginally to Rs 19,795.34 crore for the year ended March 31, 2009 against Rs 19,872.26 crore for the year ended March 31, 2008. The total income of the group has increased to Rs 109,615.60 crore from Rs 101,336.49 crore, registering a Year-on-Year (YoY) growth of 8.16%.
The board of the company has recommended a final dividend of Rs 14 per share for the financial year 2008-09, subject to shareholders approval.