Indian Equity Research and Investment Strategy
Morgan Stanley has charted a Low Risk, High Return Strategy for the Indian Equities which are likely to return positively in 2010. However, the rate of return is likely to slow over the 2009 levels. In that context, stock picking is likely to be the key to portfolio returns.
The influence of macro in determining the behavior of stocks best measured by the correlation of returns from individual stocks (market effect) with the market has been declining since its peak in May 2009. (more…)
Goldman Sachs expects strong earnings momentum to continue in the fourth quarter. Estimates indicate sales growth to increase to 34% in 4Q FY10E from 22% in 3Q. Operating leverage and cost savings should lead to a strong operating performance with
EBIT growing by 58% in the current quarter, vs. 26% in 3Q. As a consequence of the robust top line growth and improving margins, we expect net income to rise by 44% yoy in 4Q vs. 20% yoy growth in 3Q (more…)
Property prices, especially in the residential segment, are fast approaching peak levels, and in some markets such as Mumbai, they are already above previous highs. Correspondingly, FY10 has been the best year both in terms of pricing and volumes for a number of developers across markets. However, stock prices have not reflected this, with the BSE Realty Index still at Oct-08 (Lehman) levels and 60% below the peak, vs Nifty at 15% off its high. (more…)
The Securities and Exchange Borad of India under Mr. Bhave and Whole Time Director Mr. Prashant Saran have banned ULIP – Unit Linked insurance Policies of 14 companies with immediate effect. It is an excellent move in our view. Seconding our views just minutes ago Union Finance Ministry (more…)
Citi has initiated coverage on Rolta India with a BUY rating. Rolta is a unique mid-cap IT services play [for the past 10 years, it has remained a Midcap], a market leader in some of its key business segments, predominantly domestic and geared to India’s investment build-out.
Rolta’s business focus is unique – ~75% of its revenues are from Geospatial (more…)
Motherson could see strong growth in FY11/12e led by – over 25% auto sales growth in India and margin expansion of global mirror unit led by market share gain. Expect sales to rise faster than Industry owing to increase in price of wiring harness as new cars are having more features; increase in market share in plastic parts as Motherson is a key supplier for recently launched Ford Figo among (more…)