Category: Economy, Markets and Macro Views

Crude Oil speculators have created a havoc in emerging countries like India. As the 10th largest oil importing nation in the world (oil imports are close to 70% of India’s crude oil requirements), a continued uptrend in prices will likely have repercussions on India’s Balance of Payments (BoP). With every US$1/bbl increase in oil prices likely to increase the import bill by US$700mn, if WTI touches US$150/bbl, the current account deficit (CAD) would widen to US$61.3bn or 4.7% of GDP v/s base case of the CAD at US$37bn or 2.8% of GDP. This would lead to a drawdown in reserves and much further currency weakening. (more…)

Sintex is a market leader in the Indian plastics processing industry with an innovative product portfolio. The company has, over the years, leveraged its established market dominance in water tanks (~70% share) to tap other higher-margin segments.

Sintex is set to deliver a 45% sales CAGR in FY2008-FY2010E (53% FY2005-FY2008) through a strategy of innovation (it is the only company in India involved in monolithic construction) and acquisitions (four in the past year, which contributed US$249 mn to sales) (more…)

In continuing the Goldman Sachs coverage on India Logistics & Transportation, the following stocks have been assigned Neutral rating unlike the BUY rating on Gateway Distriparks and Gati Ltd.

Transport Corporation of India Ltd: TCIL
TCIL is an integrated logistics company and the largest organized player in the road freight business, with a 15% share of the organized market – it moves close to 1.5% of India’s surface traffic annually. (more…)

Just minutes ago, Goldman Sachs has released a report initiating coverage on India Transportation and Logistics Sector with a BUY rating and long-term growth prospects. Goldman has five stocks representing 63% of the Indian logistics sector’s total market capitalization. (more…)

Your eyes must be Red and BP shooting high the moment you read, FIIs are fleeing India. Chill, to save their siblings in the US [American Subsidiaries], they booked huge profits and thus their holding in BSE-500 has dropped from 20% to 17.8% at the end of March-08. Promoter share of the BSE500 picked up ~2.9%, rising to 58.2% in the quarter – the highest level in 32 quarters, suggesting continued promoter confidence even in a weakening market. (more…)

Have you seen anywhere in the world where Inflation numbers stand revised because of data collection issues ? Welcome to India, anything is just possible here. The Indian Inflation could be as high as 15%, yes you are reading that right. Combined Oil and Gas subsidies contribute to as much as 6.9% to the Inflation.

Adding to its woes is lack of proper financial planning by the government which has landed itself in Fiscal Deficit (more…)