Dalal Street

The long awaited revision to the WPI series was finally effected today with the release of the August inflation numbers. What’s changed ? At the top level – Primary articles 20.1%, Fuel 14.9% and Manufactured Products 65%. The key changes visible are – Increase in number of items from 435 to 676 items (2) 62% of the index comprises new items with
the manufacturing component seeing the maximum change (3) Increase in the number of price quotations from 1918 to 5482. All of these changes are positive and will help in making the WPI more broad-based and representative of the (more…)

Roads – The Most Basic Infrastructure which India Lacks today will be different few years from now. Following lackluster award activity over the past decade and modest improvement seen in FY10, award activity saw significant uptick in April- July 2010, at about 2,800 Kms, averaging 23.5 Kms/day (vs about 3,000 Kms in FY10). Although execution has been slow (averaging 4.9 Kms/day over the same period), we believe it will pick up substantially in the post monsoon season given current low bottlenecks on financing and construction.

Driven by regulatory and policy changes for the roads (more…)

Post L&T IDPL analyst meet we reiterate that Hyd. Metrorail (HMR) project may generate equity IRRs of 14-17% as a 24% hike in its project cost compensate for higher traffic / realty estimate. IDPL made a good pitch to improve visibility esp. of HMR. With Infra portfolio of Rs400bn IDPL intends to focus on execution v/s wins. A two year EPS CAGR of 27%, creation of growth vehicles in power (more…)