Wednesday, April 16, 2014

Indian Economic Growth @ 5.7% - Invest Now

The World Bank on 9 April 2014 has been fore casted that the economic growth rate for India for the fiscal year 2014 - 2015 will be 5.7% .In its forecast the World Bank said that the growth would be backed in the more competitive exchange rates and many large investments raring to go forward in fast track.

In its latest edition of the South Asia Economic forum the World Bank has said that the Indian conditions would be boistered by the more competitive exchange rate and progress towards clearance of important investment projects .

India may see an acceleration of growth in financial year 2013-2014 from 4.8% to further increase to 5.7% during fiscal year 2014-2015.

Apart from this the international monetary fund (IMF) in its release has also fore casted that the Indian economy would recover from 4.4% growth in 2013 to 5.4% in 2014 ,World bank has also said that India needs to bring in some necessary reforms to create a better professional environment and spur growth for the private sectors .

According to them the private sector strongly feels that India is a difficult place to do business due to multi regulations. So India is on a fast lane at last.

Tuesday, April 15, 2014

Watch out for smallcaps and midcaps

Since past few months the small caps and mid cap funds have by and large outperformed the large cap funds by a substantial margin and this category of small caps and mid caps have returned 27.5% in the past few months as compared to 11.4% by large cap funds during the same period.

However the market is  already betting on a strong government at the center .As there is not much of upside left so it makes a bit sense to book some profit in the mid cap funds .which have run up in a short period of time .Some mid caps have performed well enough 30% to 100 % .

Earlier the stock prices of the mid sized companies with good balance sheets started rising and so started their upward journey and a few months ago as such since the past few years have been in the doldrums .as the mid sized companies started rising and later became broad based as the sentiments have turned out to be positive for the segment due to the positive outcome of a stable government of India .

Moreover the companies have not grown in profits in the lines with the stock prices especially in the sectors like infrastructures, automobiles and capital goods .

Since the mid caps were available at cheap prices just a year ago and the current out performance by mid caps show that they are only catching up quickly with the large cap stocks in these times when India is headed for the elections  .

Wednesday, April 9, 2014

March quarter leaves the companies with good sentiments .

Even though the focus is on politics with elections just around the corner the corporate earnings is just about to take off will obviously put an influence on the course of direction of the market which it will head.

A number of companies particularly that faced losses in the last financial year are happy with this quarter and has at last some reasons to feel high about .As the price to earnings is calculated using profits of the last 12 months , a net loss in the March 2013 quarter getting replaced by a profit in this March 2014 will help valuation ratios due to which such stocks could get re-rated as results come out .

The following companies like Indian hotels , Tata communications , Manappuram finance , Health care , Tata, Infrastructures, I.T. are the sectors and companies to be watched as they are on the winning streak track .

Best Stock To Invest In April 2014

Tuesday, April 8, 2014

Stock markets continue to thrive for more than a week

The stocks continued to gain even on the tenth consecutive day but were dragged down by banks and reliance industries where as on the other hand the pharma stocks made a come back after it fell by 2 % in this march .

The investors from the foreign coasts continue to buy Indian stocks after the $ 3.6 billion purchase in the month of march ., and they bought equities worth Rs 717 crores , while the domestic institutional investors or DIIs sold stocks of the same amount , provisional data from the BSE .

The reliance industries fell to 0.52 % to 951.95 and SBI slipped 1.97 % to 1895.35 . ICICI bank dropped 0.59 % to 951.00 . The pharma stocks gained as banks fell with wockhard rose to 8.85 % to Rs 600.85 where as Ranbaxy rose  5.12 % to Rs 424.80 % .

 Moreover the HSBC India composite output index which maps both services as well as manufacturing, production growth slowed and service sector activities fell at a faster rate in the month . The numbers showed weakness in the economy .

The S&P BSE  sensex ended at 42.42 points lower at 22509.07 while Nifty gained 270 points during the last ten trading sessions and on this Wednesday lost 16 points to close at 6736 which as expected is just a minor correction after the continued rally for the last ten trading sessions .

Even shares of the banks fell after RBI classified the option for spreading the mark to market ( MTM) losses over the past three quarters ended on March 31, 2014 and no further extension has been allowed . The oriental bank of commerce declined to 5% to Rs 225 , while Karnataka ,Vijaya , Bank of Baroda , UCO and Central bank lost between 2% to 3 % .Another sector to watch out is the PSU bonds in which the investors have appreciation of 4 % to 7 % in their capital with in a short short span of time .

 So as of the recent trends the rate of inflation keeps continue to fall , there are rate cut chances which may begin in 2015  . As soon as we achieve higher accelerated growth with falling inflation , interest rates may be cut . So at present it does not makes sense for investors to exit investments by booking profits at this point until and unless there is a compulsion . Of course in case of selling the investors will attract short term capital gain tax as per the individual income tax slab which will only help in eroding the desired returns .

Thursday, April 3, 2014

Gold & Silver Import Duty Relaxed

The government has now reduced the import tariff value on gold to $ 421 per 10 gm from $ 445 per 10 gm earlier .Also the import tariff value - the base price at invoicing - in case of silver has been reduced to $ 644 per kg from 694 per kg earlier as per the notification issued  by the central board of  excise and customs .

The tariff is revised on a forthnightly basis after analysing the global price trends . Gold is the second largest import item for India after petroleum . The government had taken several  measures to curb gold shipments to address the high current account deficit .

 These measures include raising import duty to 10 % on gold and also made it mandidatory for traders to export 20 % of the imported gold thus thereby creating a supply crunch in the domestic markets .

Wednesday, April 2, 2014

Plan Your 2014-2015 Finances

The movement in mid cap and small cap will eventually boost mutual funds inflows.

The movement in midcap and small cap stocks in the last week will help mutual funds to end the financial year net asset value ( NAV ) . The BSE midcap index has risen by 3.5 % and small cap index by 3.2 % as against 1.5 % gain in the sensex .

Soon the retail investors will start putting money in equities directly .So also an FII fuelled rally in equities following improved macro numbers and especially following improved macro numbers and especially strongly pinning the hopes of a stable government which has attracted HNI investors and so the retail money is yet to flow in .

It has been a good start for equity mutual funds for the financial year 2k14 since 2k10. As sensex gave a return of 21 % in 2k13-2k14 ,BSE midcap index rose to 15.5 % and BSE small  cap index rose by 22 % . As BSE mid caps and small caps had shown negative trends of return in the past three years . AUM ( assets under management ) of mutual funds in India has crossed Rs nine crores for the first time this January .

And in Feb. the equity funds recorded inflows for the fourth consecutive month .For example Oriental Bank of Commerce had declined by 15 % since jan till 25b of march, but has risen 11 % in the last five trading sessions. However this time the rally of mid cap has been supported by various positive factors.

Performances of some mid cap funds have been better than BSE indices. As the is at the record high the fund houses will have to chalk out ways to attract retail investors as well as retain the existing set of them .