India continues to reside in the Glamor quadrant as composite momentum stays strong, while valuation remains expensive. India has a positive beta to the regional markets and would likely benefit from an Asian bull, according to our RAM analysis.
Stronger US$ against regional currencies would further improve India’s return. (more…)
Month: February 2010
Buy Automotive Axles – HDFC Sec
Kalyani Group company Automotive Axles (AAL) is well placed to benefit from the ongoing recovery in medium and heavy commercial vehicles (MHCV). AAL’’ product portfolio consists mainly of higher margin axle assemblies, while it also manufactures axle housings. It is is India’s largest independent manufacturer of rear drive axle assemblies and its top clients include Ashok Leyland and Tata Motors. (more…)
Reliance better without Lyondell-Basell – Goldman
As Lyondell-Basell (LB) announced that it has reached a settlement with unsecured lenders for a consideration of US$450mn, will aid the company to emerge from Chapter 11 bankruptcy. LB acquisition does have strategic merit for RIL, but the bid not going through would be a better outcome than RIL getting drawn into a bidding war and eventually over-paying for the assets.
Mukesh Ambani’s Thirst for Inorganic Growth – RIL will look to pursue inorganic growth, since see no major (more…)
Impact of Fertilizer Policy Change
The cabinet approved the following changes to fertilizer policy that will be operational from April 2010. These changes will reduce the govt’s subsidy burden.
The govt. has proposed a 10% hike in farm-gate prices of urea to ~INR5,310 from ~INR4,830 per ton currently. This will likely reduce the overall fertilizer subsidy burden by ~INR13bn in FY11. However, the earnings impact for urea companies will be minimal, given realization for them will not likely change. Moreover, as per our economist Indranil Sen Gupta, the urea price hike will increase inflation by 25bps. (more…)
Indian IT, Media, Pharma, Telecom, Power Industry Budget Wishlist – II
We are covering to you on what the captains of the Indian industry have put forth in their budget-2010 wish list.You can read the wish list of Banking, Cement, Infratsructure & Construction, FMCG and Hotels here. In this Article we touch base on the wish list of other verticals.
Information Technology – Extension of Tax exemption beyond FY11, Rationalization of the current levy of 15%, Subsuming of VAT and service tax incidence to a single levy and Nation wide broadband rollout and focus on skill building. (more…)
Pre Budget Industry Expectations – 1
Amidst high Inflation and extending sops to the Indian industry for growth, Mr. Mukherjee as a difficult task on Hand. We believe that Mr. P. Chaidmabram, the seasoned Finance Minister is the best-fit for this job with his vision for reforms and transformation. Lesser Mortals, we the democratic voters of India have to be content with High Level Politics and with this the Indian Industry has presented its wish list to the FM. We cover industry-wise wish list in 2 posts.
Automobile – Continuation of stimulus package, Remove differential excise duty between small and large cars and Extension of accelerated depreciation benefits for CV. (more…)