se market watch gainers and losers? - christ university · pnb gilts 532366 30.00 34.80 30.00 34.80...
TRANSCRIPT
VOLUME 7
September Edit ion
“Inflation is when you pay fifteen dollars for the ten-dollar haircut you used to get for five dollars when you had hair.”
BSE Market Watch gainers and losers?
DTC - A Gain or a Loss?
Busiest Week for IPO Market
INDIA Increases its share in World market-cap
DEPARTMENT
OF
MANAGEMENT STUDIES
Silver 33,355 per kg
Gold
19,185 per ten gms
1$: `45.185
MASTER
OF
FINANCIAL MANAGEMENT
PARTICULARS RATE
Bank Rate 6%
Repo Rate 6%
Reverse Repo 5%
CRR 6%
SLR 24%
`
iNSIDE tHIS iSSUE ……………..
International News…………………………………..1
National News……………………………………….2
BSE– Market Watch…………………………………3
Return To Protectionism……………………………..4
Disinvestment Fiasco………………………………...5
DTC - A Gain or a Loss?.............................................6
Money Over Mind…………………………………...8
Bad Sign For Indian Debt Market…………………...8
Time To Expand The Horizon……………………….9
India Increases Its Share In World Market-Cap……..10
Busiest Week for IPO Market……………………….11
Sectorial Review : IT-ITES………………………….12
………………… Jargon Buster……………….…….13
……………………Fino Cross………………………13
……………………FinQuest………………………...14
The Road to Succes: Arthayudh 2010….....................15
International News
'1 in 7 Americans live in poverty'
The recession in US threw millions of people out of work last year, leaving one
in seven Americans in poverty. The overall poverty rate climbed to 14.3 per cent,
or 43.6 million people, the Census Bureau said.
Wall Street critic Warren to shape consumer watchdog
President Barack Obama named Wall Street critic Elizabeth Warren on Fri-
day to oversee creation of a new consumer financial protection agency,
drawing praise from liberals and an outcry from Republicans and the finan-
cial industry.
EMERGING MARKETS-Brazil's real outperforms on week, region firms
Latin American currencies firmed following strong economic data from China, one of the region's
top trading partners. China's imports leapt in August, indicating high demand for raw materials from
Latin America, Brazil in particular.
Do-little G20 summit cheers spared bankers
Bankers voiced relief on after world leaders abandoned a global
bank levy and eased the timetable for new capital requirements at
a G20 summit in Canada which posed questions about the fo-
rum's effectiveness. U.S. Congress adopted a landmark financial
regulation package removing uncertainty, and the G20 dropped a
2012 deadline for more stringent risk-provisioning rules.
Nokia appoints Microsoft executive as new CEO
The world's largest mobile phone maker Nokia named a new software-savvy chief executive from
Microsoft to help it battle slumping profits and an eroding market share in the smartphone seg-
ment. The Finnish telecommunications equipment giant chose relatively unknown Stephen Elop to
replace Olli-Pekka Kallasvuo.
1
National News
Industry sets doubts at rest, grows 13.8% in July Growth in India's industrial output nearly doubled from a year-ago peri-
od to 13.8% in July on the back of a double-digit expansion in capital
goods production. The figures released lifted expectations of the econo-
my notching an overall growth of over 8.5%.
Durables makers won't hike prices this festive season
Consumer durable makers have decided against a hike in prices in
the festive season, which sees a jump in sales, despite a rise in raw
material prices Durable makers such as Godrej & Boyce, Samsung
and Videocon have said that they would rather absorb the high costs
than play party pooper for their consumers.
Hindalco unveils major investment plans Hindalco Industries, an Aditya Birla group company, has drawn up a capital expenditure plan of Rs
10,000 crore this fiscal, going up to Rs 11,000 crore in 2011-12.The company will also pump in about
Rs 40,000 crore over the next four years in various greenfield and brownfield expansions.
Tax Code to treat FIIs' profit on sale of shares as capital gains Foreign institutional investors (FIIs) can breathe easy with the Direct Taxes Code (DTC) Bill, 2010
proposing that their income be taxed as capital gains rather than business income. Opinion is divided
on whether this will end the uncertainty over FII taxation.
Sensex regains 20k
The Sensex climbed by 184 points to a fresh 32 month high regaining the magi-
cal 20000 points level. During the week the Sensex recorded a gain of 2.29%.
Shrugging off weak global cues, the wide based Nifty 50 also rose by 58.75
points to 6,018.3.
2
BSE– Market Watch
Scrip Name Scrip
Code
Open
Rate
High
Rate
Low
Rate
Last
Traded
Last
Price
Last
Close Abs
Last
Close (%)
Scrip
Group
Maruti Infra 531540 17.50 19.32 17.38 19.32 16.10 3.22 20.00 B
PNB Gilts 532366 30.00 34.80 30.00 34.80 29.00 5.80 20.00 B
Indo Amines 524648 22.90 26.40 22.60 26.40 22.00 4.40 20.00 S
AK Capital 530499 495.2 594.90 485.0 594.90 495.75 99.15 20.00 B
MANJEERA 533078 97.50 111.95 92.40 111.95 93.30 18.65 19.99 B
SQL Star 532249 13.22 15.13 13.22 15.13 12.61 2.52 19.98 S
Diamines &
Chem
500120 75.70 90.10 75.70 90.10 75.10 15.00 19.97 S
KLG Cap
Serv
530771 97.00 116.00 97.00 116.00 96.70 19.30 19.96 B
Shardul Sec 512393 90.00 105.80 89.90 105.80 88.20 17.60 19.95 B
XL Telecom 532788 26.60 31.90 26.50 31.90 26.60 5.30 19.92 B
Scrip Name Scrip
Code
Open
Rate
High
Rate
Low
Rate
Last
Traded
Last
Price
Last Close
Abs
Last
Close %
Grp
Financial Tech 526881 1,335 1,335 1,215 1,221.0 1,371.9 -150.90 -11.00 A
Satyam Comp 500376 106.85 108.4 99.65 100.10 106.50 -6.40 -6.01 B
Solix Tech 501421 16.90 19.50 16.90 17.10 18.25 -1.15 -6.30 B
First
Custodian
511122 27.00 28.50 24.50 24.75 26.45 -1.70 -6.43 B
Indo
Asian Fin
530747 12.97 13.00 12.50 12.50 13.42 -0.92 -6.86 B
Tulsi Extr 532948 72.20 74.60 64.35 67.10 72.10 -5.00 -6.93 B
Remi
Edelstahl
513043 29.90 29.90 24.20 24.25 26.10 -1.85 -7.09 B
Chandra Prab-
hu
530309 18.26 19.79 18.25 18.35 19.78 -1.43 -7.23 S
Transgene Bio 526139 58.40 58.40 50.05 52.35 56.50 -4.15 -7.35 B
Crystal Soft 526033 2.37 2.38 2.11 2.11 2.28 -0.17 -7.46 B
Top Losers in BSE
Top Gainers in BSE
3
Return To Protectionism
he Ohio governor Ted Strickland via an ex-
ecutive order banned outsourcing by US
companies in the state. After this it was
President Barak Obama who announced his
intention of extending the H1 and L1 tax breaks to
US companies who create jobs in the home soil and
not to those who create them overseas. The presi-
dent spoke in the backdrop of rising unemployment
(expected to touch 10% by March 2011).
It has created some unrest in India and Indian com-
panies; many of who serve as the back office for
major US companies and whose source of revenue
come from jobs off shored by US firms.
In 2008, around 0.7 million people worked in the
outsourcing sector in India, a number of which has
gone up in the past year and a half. Annual reve-
nues of $11 billion, around 1 percent of India‘s
GDP comes from these activities. It is estimated
that 60% of Indian export in the IT sector are to the
US. In other words a part of India‘s outsourcing
industry is dependent on the US.
Commerce minister Anand Sharma has announced
his intention of taking up the issue at the trade po-
lice forum. Former minister Kamal Nath made a
quick point that US companies were not doing any
favour by outsourcing jobs to India. But a senior
Commerce minister officially pointed out that it
could be a matter of concern if the tax regime that
governs these companies is tweaked. ―If tax con-
cession is geared to discourage companies from
sourcing jobs outside, the economics could well
change to the disadvantage of Indian companies‖.
Many analysts believe that though the official
growth target of India‘s outsourcing sector is wide-
ly optimistic, it will slow down in the future. The
impact for the Indian sector could be quite signifi-
cant though as additional countries such as China,
Mexico and Vietnam are also expanding their out-
sourcing operations and often provide cheaper ser-
vices.
In the past too, the US government has contemplat-
ed protectionist measures many times. At that time
though, the US was confident of its ability to hold
its own in the knowledge industries. But as that
edge has eroded, the call for keeping jobs in the US
has only grown more strident. The Indian industry
would be wise to take note of this, and to try and
reduce their dependency on the outsourcing of US
companies and take this as an opportunity and use
the same jobs for India‘s growth and development
so as to reach the super power sooner than estimat-
ed or to use the mind striving behind the US com-
panies for our own welfare and power ourselves to
the Growth of India.
By: Sumit Agarwal [email protected]
It’s time for Indian IT companies to focus on their own
country rather than relying on contracts from the US.
4
Disinvestment Fiasco
he government had set disinvestment target of Rs. 40,000 crore (0.58% of GDP) to cut down the
fiscal deficit. So far only SJVN Ltd has gone ahead with disinvestment in the current financial
year. However, since September 2009, six companies- SJVN, NMDC, NHPC, NTPC, REC and
oil India- have gone for disinvestment of 5-13 % of their shares. Retail demand for such shares
had been lackluster. The first three showed poor performance in the stock exchange, whereas REC and
Oil India have given good returns to investors. NTPC is still trading at an average return basis.
Demand for the sale of shares of the company is the function of:-
Overall stock market conditions:- One of the reason of the poor performance of the recent disin-
vestment is the poor domestic and global stock market performance in the last nine months. In this
period the BSE SENSEX has hardly moved up by 5 percent and S&P 500 has declined by 2 percent.
Hence FPO‘s have not seen a strong demand.
Past financial performance of the company:- Growth in sales and the profit of the company over
the last few years and its stability to sustain its margin are major determinants for success of FPO‘s.
Companies like BEL and SAIL have a strong track record, hence it is easy to divest these shares.
Future Prospects:- Future prospects of the companies going in for disinvestments are the key driv-
ers of demand for its shares in the market place. IPO‘s of the companies like Coal India may garner
good demand. Since India does not have large oil reserves, it is an important resource to meet the
domestic energy needs.
Valuation of the company t Divestment price:- It is one the most important determinants which
can make or mar the success of the issue. Fairly priced issues with low growth would not attract in-
vestors, whereas conservatively priced issues of the companies having good growth potential attract
investors.
Quality of management:- Quality of management and governance is also an important determinant
of valuation of a company.
Divestment in its current form can at best be a stop gap arrangement for broader economic reforms for
sustained growth of the economy. It cannot be permanent solution to the current fiscal problem. It is im-
portant to improve efficiency of many government companies. Also there would be a better appetite for
PSU shares if instead selling of small percentage of large companies, the government decides to go
ahead and sell a larger stake in PSU‘s.
By: Rahul Chettri
Divestment in its current form can at best be a stop gap
arrangement for broader economic reforms for sustained
growth of the economy.
5
DTC - A Gain or a Loss?
he DTC will replace the Income Tax Act, and rings many changes in
personal and corporate taxation. It will come into effect starting April 1,
2012. Here we demystify what the impact of the DTC will be towards
the personal taxation for salaried individuals. Following on from its
original proposal last year, the Government had issued a revised discussion pa-
per in June 2010. In its original form the DTC was expected to bring about far
reaching changes in the personal taxation slabs and available exemptions.
The Direct Taxes Code (DTC) Bill introduced by Finance Minister in the Union Parliament remained a
non event for the market. The Bill is significantly altered and diluted compared to the original form and
also compared to the revised discussion paper released in June 2010. Most of the provisions in the origi-
nal DTC pertaining to MAT, SEZ, Capital Gains, Tax treatment of Long term savings, etc have been
watered down meaningfully. This has brought a big relief for investors as it proposes to continue with
the existing provision of zero tax on long term capital gains and rationalize short-term capital gains tax
for annual income up to Rs10 lakh.
For Individuals (Men,
Women & HUF)
For Senior Citizens
Slab Under Income Tax
Act
Up to Rs 1,60,000 - Nil;
From Rs 1,60,001 to Rs
5,00,000 - 10%;
From Rs 5,00,001 to Rs
8,00,000 - 20%;
Above Rs 8,00,000 - 30%
Up to Rs 2,40,000 – Nil;
From Rs 2,40,001 to Rs
5,00,000 – 10%;
From Rs 5,00,001 to Rs
8,00,000 – 20%;
Above Rs 8,00,000 – 30%
DTC Parliamentary Bill
(Aug 2010):
Up to Rs 2,00,000 - Nil;
From Rs 2,00,001 to Rs
5,00,000 - 10%;
From Rs 5,00,001 to Rs
10,00,000 - 20%;
Above Rs 10,00,000 - 30%
Up to Rs 2,50,000 - Nil;
From Rs 2,50,001 to Rs
5,00,000 - 10%;
From Rs 5,00,001 to Rs
10,00,000 – 20%;
Above Rs 10,00,000 – 30%
6
The Direct Taxes Code (DTC) Bill introduced by
Finance Minister appears good for the market &
the common man though a rise in MAT may
have an impact on some sectors of corporate In-
dia. The DTC proposes to raise the exemption
limit on income tax from the current Rs1.6 lakh
to Rs2 lakh. The DTC proposes to raise mini-
mum alternate tax to 20%. MAT is imposed on
profit earning entities, which
do not fall under the tax net
due to various exemptions.
Furthermore, Dividend Distri-
bution Tax is proposed to be
fixed at 15% and corporate tax
at 30%. All this leads for us to
be much more bullish this
month than what we were last
month. It is very likely that
Indian markets are going to do
very well in the next six
months. All this due to a very
strong domestic macro factors discussed above
plus the international factors. On the internation-
al factors, the bullishness comes on the back of
what Mr. Bernanke had to say in his speech at
the Fed's Jackson Hole retreat recently. He ad-
mitted that the ―incoming data suggest the recov-
ery has slowed in recent months‖.
The US economy grew much slower at 1.6% an-
nualized in the second quarter than what was
forecasted by experts earlier. Yet, the Fed Chair-
man still insisted that all the preconditions are in
place for a more vigorous recovery, which
should be here by next year.
Of course, if that doesn't happen, the FOMC ―is
prepared to provide additional monetary accom-
modation especially if the outlook were to deteri-
orate significantly‖ that he is willing to discuss
all the Central Bank's options for introducing
further policy stimulus, but he doesn't seem en-
tirely convinced that they would necessarily be
effective‖ He claimed that additional purchases
of long term securities would be effective in fur-
ther easing financial conditions.
Borrowing costs in credit markets are not the
problem they were during the crisis, while mort-
gage rates are already at record lows. Another
stimulus will further debase the US dollar,
(whenever that happens), but US will not let con-
sumption slacken. There is not going to be a
double dip now in our opin-
ion. The above implies that
emerging markets will see
robust inflows through dollar
carry trade. India will stand
to benefit also. INR will ap-
preciate and we are also star-
ing at a very strong asset in-
flation coming up in India in
some time. With the cheap
cost of money in the world
system and a clear discon-
nect between the physical market for commodi-
ties based on demand and supply and the paper
(futures) market for these commodities, we
would not be surprised that global commodities
will once again start to rise again.
Thus, gold, silver, crude oil, ferrous and non fer-
rous metals, agricultural commodities, real estate
and equities all would start to move up. Going
forward, for Indian equity markets, the contrari-
an sectors is where there is a maximum money
making opportunity currently.
By: Prashant Kini
Priti Dutta
7
MIND OVER MONEY
BAD SIGN FOR INDIAN DEBT MARKET:
rom the prospect of Indian debt market, it was a good sign that FII
inflows into the market till this august month have exceeded the
inflows over the full calendar year 2009. Net FII inflows into the
debt market had grown over eight times from over $1 billion in 2009 to
$8.25 billion in the first seven months of this year which is evident
from the table given.
But again, it has been disappointing due to the increase in interest rate
on provident fund deposits by to 9.5% which will benefit nearly 4.71
Crore employees across the country but at the same time it will impact
the debt market due to chance of switching of investment in provident
fund by the investor of debt market as they will get more return com-
pared to debt market. By: Ajoy Kumar Roy
uccess means different things to different people but generally comes down
to achieving our desires, or how much control we have over the important
things in our life, whether it is acquiring real estate, spending time with fam-
ily or the freedom to pursue your dreams . The standard of success in life is
not the things or the money—the standard of success is absolutely the amount of
joy you feel.
From birth we have been preoccupied with acquiring wealth, from toys to houses, helping define our
current financial philosophy. For e.g., you may have been raised with all the money and possessions
one could want, or maybe you came from a single-parent home where money was tight and you had
less than most of your peers. You may have injured someone using the power that money and wealth
can give,. All of these experiences have helped define your personal financial philosophy. Other com-
mon beliefs that may have helped shape your philosophy are: money is the root of all evil, money
doesn‘t grow on trees and so on.
Regardless of how our philosophy evolved, each of us has the personal responsibility to identify what
our personal financial philosophy is, and then ask ourselves if our current philosophy is in line with
our goals and desires. Gandhi stated, ―A man is but a product of his thoughts, what he thinks he be-
comes.‖ It is our responsibility to project the feelings, emotions and thoughts that reflect the results we
desire in life-this is how to put mind over money.————————————————————- By: Shikhar Gupta [email protected]
8
TIME TO EXPAND THE HORIZON
espite many false starts over the past several years, the prospect of retail being opened up continues
to excite India inc. FDI in retail had been a hot topic of debate. It is a sensitive topic due to the fact
that it involves different categories of people such as consumers, Farmers, local retailers and global re-
tailers leaving one or the other affected.
FDI is especially centred on the negative impact on small retailers. But it is evident that Indian shop-
keepers are barefacedly overcharging the consumers simply because they can. No force-Business or gov-
ernment is there to stop them. This is why India needs to stand up for the beleaguered consumers, one
third of whom are officially poor. Generating greater competition in retail can only solve the problem of
beleaguered Indian consumers making the consumers the king at the end
THE COMPLEXITIES:
The entry of big corporate‘s in to organised retail has not resulted in supply chain getting required boost
as it was expected to be or making the consumer the king. This is because rentals in India are pretty stiff
and is estimated it amounts for nearly 20% of retailing costs as compared to 6-10% in other countries.
This is one of the reasons why organised retail has not become a runway success denting the dominance
of Mom & Pop stores.
Super market chains also get their supply from same Mandis that feed hawkers and efforts to procure
directly from farmers largely remains on paper. Many states have not liberalised their agricultural pro-
duce act which restricts companies from sourcing directly from the farms. Mandis add to transaction
costs that prevent best post harvest practices being introduced.
The delay in amending the forward contract regulation act 1952 to boost futures trading in commodities
also is one another complexity which does not give companies or big retailers adequate trading space to
source commodities at competitive prices. Farmers are also losers since they cannot leverage the stock to
the best advantage and are forced to sell after harvest.
The government is also well aware about this issue since the small trader community that would get af-
fected is a sizeable vote bank.Getting rid of all these complexities still remains a question and govern-
ment is more bothered about the vote bank of small traders rather than trying to remove these complexi-
ties and making consumer the king at the end.
By: Sindhujaa.V
9
ith the Sensex
c r o s s i n g t h e
20,000 mark, the
share of Indian equities in
global market also in-
creased. Market capitali-
sation of India as a pro-
portion of world market
capital has risen to a rec-
ord high.
According to data sourced
from Bloomberg, the
country's market capitalisation as a proportion of
the world market capital is currently 3.34%. In-
dia's current market-cap is $1.55 trillion as com-
pared with world market-cap of $46.5 trillion.
This is higher than the 3.12% share India enjoyed
at the market peak of January 2008. This data is
expressed in US dollars to make comparison be-
tween market caps of various countries possible.
The main reason for the increased share of Indian
equities is that Indian equity prices have recov-
ered faster than many of the other global markets
and are closer to their all-time highs recorded in
2008. Revival in equity issuances over the last
eighteen months is another reason.
According to ‗Underwriter Tables' available on
Bloomberg, India Inc has raised $ 43 billion at
current exchange rate from the beginning of Janu-
ary 2008. A flood of qualified institutional place-
ments, FPOs, IPOs and rights issues resulted in
increasing the market cap from January 2008. In-
dia increased its share in equity markets despite
the fact that rupee depreciated by 14% in the peri-
od between January 2008-September 2010.
Underperformance of the other global indices al-
so helped India improve its share to some extent.
World market capitalisation currently stands at 82
per cent of its January 08 highs. The shrinkage in
world market-cap was due to dip in share of
countries such as China (1.2% points), Germany
(0.7% points), France (0.85% points) and Spain
(0.3% points). Underperformance of European
equities and decline in the euro has taken a toll on
the market share of European nations.
From the lows:
Indian equities, which witnessed major sell-off
during the October 2008 lows, had only 1.73% of
the world's market capitalisation at that time.
Since then, India saw 1.6% jump in its share. The
US and the UK, on the other hand, had 35% and
9.6% share of the total market-cap at October
lows. These countries lost 5 and 1.9 percentage
points from that point. Shares of developed mar-
kets increased when markets were declining,
while developing markets increased their share
during the recovery phase.
By: Archana.G.Balwalli
India increases its share in world market-cap
Countries Current share (%)
USA 29.72
Japan 7.71
China 6.92
UK 6.71
Hong Kong 4.9
Canada 3.79
France 3.6
India 3.35
10
his month is slated to be the busiest in the
last 15-years for the primary market, with
eight companies seeking to raise around Rs 3,000
crore through public offers, in addition to three
already underway. The initial public offers of
eight small and medium scale companies, includ-
ing Cantabil Retail and Ramky Infrastructure, are
being introduced this September. The combined
value of these IPOs is Rs 2,853 crore. So, in all,
people have the choice to invest in as many as 11
companies in a single week, highest since 2007.
—————————
"This will be the busiest month in the Indian pri-
mary market history after 1995. Even during the
red-hot bull market of 2007, no single week fea-
tured 11 IPOs," SMC Global Securities Equity
Head Jagannadham Thunuguntla said. He added
that the last high was in February 2007, when 10
IPOs had hit the capital market in one week. Ana-
lysts believe that there is enough appetite in the
market to absorb these issues.————————
-
"There is enough appetite among investors, and
large numbers of IPOs are providing more choic-
es to them. They can choose issue from a variety
of options," Enam Securities MD Yogesh Kapur
said._______________________________
The companies, which are hitting the primary
market in the penultimate week of September in-
clude, Orient Green Power (Rs 900 crore), VA
Tech Wabag (Rs 500 crore), Electrosteel (Rs 285
crore), Tecpro Systems (Rs 268 crore), Ashoka
Buildcon (Rs 225 crore) and Gallant Ispat (Rs
40.50 crore).While Ramky Infrastructure and
Cantabil Retail will hit the capital market with
issue sizes of Rs 530 crore and Rs 105 crore
r e s p e c t i v e l y . _ _ _ _ _ _ _ _ _ _ _ _
Besides, tutorial service provider Career Point,
entertainment and media firm Eros International
and Microsec Financial Services, which opened
in 1st week of the month, will be available for
subscription by the end of the month. Recently,
public issues of a number of entities including
SKS Microfinance, Prakash Steelage Ltd and Gu-
jarat Pipavav Port Ltd got good response from
investors and were oversubscribed. Listing of the-
se firms was also impressive. The follow-on pub-
lic offer of the state-run Engineers India Ltd also
received big investor response.
Corporate India raised over Rs 47,867 crore
through 44 public offers during 2009-2010, a pe-
riod when the stock market benchmark Sensex
gave a handsome return of over 80 per cent.
Apart from some big IPOs such as that of JSW
Energy and Adani Power, the fiscal also saw di-
vestment of the government's stake in NMDC and
NTPC through the follow-on offers.
By: Vinoo Sophia S
Busiest Week for IPO Market
11
ndian IT-ITES industry has shown remarkable pace since 2001-02. Overall growth has grown to $
58.7 billion in 2008-09 in comparison to $ 10.2 billion in 2001-02. Despite the global recession IT-
ITES industry grew at 12.9% in the year 2008-09. As per NASSCOM, the industry is diversified
across three major focus segments – IT Services, BPO and software products & Engineering services.
While IT Services have been the mainstay of the industry, BPO and engineering services sector has built
upon the India value proposition and today there exists integrated service providers across three focus
areas as well as niche providers.
The major three components of IT Services sector are custom application development, application
management and support and training. Other significant components are IT consulting, systems inte-
gration, Infrastructure Services (IS) outsourcing, network consulting & integration and software testing.
Exports continue to dominate the revenues earned by the Indian IT-ITES Industry. The export intensity
of Indian IT-ITES Industry has grown from 74.5% in 2001-02 to 78.9% in 2008-09. Total IT-ITES Ex-
ports are estimated to have grown from $ 7.6 billion to $ 46.3 billion in 2008-09. Though the IT-ITES
sector is export driven, the domestic market is also significant contributor to this industry. The revenue
from the domestic IT-ITES market is estimated to have grown from $ 2.6 billion in 2001-02 to $ 12.4
billion in 2008-09.
At the end of current year i.e 2010-11, IT-ITES export is expected to reach $ 60 billion and by 2011-12
which is also the terminal year of the eleventh five year plan, the figures are expected to touch $ 72 bil-
lion, expecting growth rate of 20% for 2011-12.
IT: Success Factors
Increasing number of skilled professionals in IT.
The demographic factor. Approximately 60% of the population of India lies in the age group of 15-
65. More than half of the population of India is below the age of 25. So in the future, the number of
working people is going to be more than the number of dependents.
The vast academic infrastructure of India.
India has the second largest English-speaking workforce in the world.
By: Ajay Singh
Sectorial Review : IT-ITES
Year/ Item 2001-
02
2002-
03
2003-
04
2004-
05
2005-
06
2006-
07
2007-
08
2008-
09
CAG
R
Exports 7.6 9.5 12.9 17.7 23.6 31.1 40.4 46.3 28.6
Domestic 2.6 3.0 3.8 4.8 6.7 8.2 11.7 12.4 22.2
Total 10.2 12.5 16.7 22.5 30.3 39.3 52.0 58.7 26.9
12
Sharpe Ratio- A statistic that relates the return on an investment to an investor's risk of owning the
investment.
Contrarian- An investor or professional who invests in out of favor securities. Contrarians buy stocks
when they are cheap in relation to other stocks. This investment strategy is the equivalent of betting
against the herd instinct that dominates the thinking of most investors.
Assets Under Management (AUM) - The total value of assets under management by a money
manager or serviced by a financial advisor.
Junk Bond- A bond with a credit rating of BB or lower. Some investors also refer to these bonds as
high income or high yield.
Dollar Cost Averaging- An investor buys a fixed dollar amount of stock at regular intervals so that
more shares are bought at lower prices and fewer are bought at higher prices resulting in a lower overall
average cost that is lower than the average price paid for the shares.
Jargon Buster
FinQuest
1. What's the term that applies to the most reliable industrial shares of reputed companies which
have a stable growth and least risk is involved in investment in such companies by the public?
2. This term is derived from the Greek word 'Oikanomia' means "House Management". What is
it?
3. Which bank is promoted by 20th Century Finance Corporation and Keppel Tatlee Bank of
Singapore in India?
4. In Indian economic scenario what significant reform was introduced by the Indian Govern-
ment on April 1, 1957?
5. Which financial services giant is referred as the "Thundering Herd"?
6. What is the exchange rate of one currency for another over a fixed period of time called?
7. Name this famous personality who founded Pratichi Trust with the use of his Nobel Prize
money?
8. What does Chalu Upla mean in stock trading?
9. Which word was derived from the French word Bougette meaning 'Little Bag'?
10. Name the person who coined the term "Management by Wandering Around (Walking
About)", and popularly known as MBWA?
13
Fino Cross
Across 1. Net worth of a business 5. Raise money through sale of debt or equity 9. Foreign exchange market 10. FICO score provider 11. Conditional 12. Ownership papers 14. Not cheap 17. Employer number, abbr. 18. Rolls symbol 19. Interest rate tsars 20. Make bigger 23. Obtain 25. Accumulate 28. If the ___ fits... 30. Silently implied 32. Money provider- at a cost...... 33. It was Black in 1869 34.___ ratio: A stock's price/earnings ratio
divided by its year-over-year earnings growth rate
36. Bank's house takeover 40. Conger is one 42. Roth is one option 43. Drove 45. __ Mans car race 46. Ended a stock position due to an execution
of a market order to buy or sell a security if a specific price is reached
47. Decide to opt out of an opportunity
Down 1.Benefits plan that allows employees to select from a pool of choices 2. Equality 3. Federal income __ 4.Curve which supposed that for a given economy there is an optimal tax level to optimize tax revenues 5.Buying a house and reselling shortly afterwards 6.Index that tracks the activities of experienced and inexperienced investors 7. Coming closer 8. Go over the limit 13. Carry out 15. Cool 16. Customer address 21. Took the initiative 22. Possible set of future events 24. Reuses, to preserve the environment 26. Trumpet or plug? 27. Penalties 29.Investment made in order to reduce risk of
adverse price movements in a security, by taking an offsetting position in a related security
31.The ___/fear oscillator (investor's emotional swings)
32. Raises 34. Atlantic, slang 35. Wise adviser 37.Overall software integration for all the
company's processes (abbr.) 38. Limit 39. Nonsense 41. Golfer, Ernie 44. Old record, abbr.
14
The Road to Success: Arthayudh 2010...!
15
wo months of running around, enormous hard work, arranging for sponsors, having sleep-
less nights and getting the best out of everyone to make this fest a success was truly an invin-
cible experience for all the students of MFM. The backstage chaos, the screaming and shouting,
the little failures and disappointments was all forgotten when smiles accompanied with huge
applauses were seen echoing all over the college auditorium. The national level fest conducted
by the students of MFM Christ University, „ARTHAYUDH‟ happened across 2 days on 15th
and 16th of September. This year the theme of Arthayudh- „The Aam Aadmi‟ focused at the battle
fought by the common man to survive the meltdown. His struggle to fight back the diverse diffi-
culties and emerge as a winner displayed the paradigm shift to savings and calculative expendi-
ture even in terms of dwelling units.
The theme this year tried to bring about the various issues faced by the Aam Aadmi and also an
attempt to bring out various facets of the Aam Aadmi‟s routine life as we see it, through our
events of the fest. The fest and the theme aimed at making the Aam Aadmi the hero of today‟s
time. Arthayudh was a wonderful experience for all of us. Managing a fest of this magnitude
was not an easy task, but with immense hardwork, dedication & above all teamwork, we made
this fest a grand success. The battle was not only fought with valour but also won with grace.
All the events pertained to the theme- „The Aam aadmi‟. We had B-school Budget, one of its kind
event introduced this year for checking the innovativeness and lateral thinking. Chakravyuh- how
efficiently one can overcome the trap prepared for him. Milaap, a unique event based on Mer-
gers & Acquisitions. Arthavyapar, to judge a person on his stock market knowledge and witness
the art of bidding and buying. Prashnamanch, to evaluate the amount of knowledge he has from
the ocean of information available. Chanakya-“The Strategist”- to test the abilities and capabili-
ties of the person and to uncover the best within. Arthayudh witnessed extensive participation
from colleges across Karnataka like St Josephs, Mount Carmel College, Kristo Jayanti college,
Amity College, RIMS, BIMS Belgaum, Garden City, IBMT and many more...
Apart from all we did n managed, the most important thing we learnt was that „The whole is
greater than the sum of the parts; Teamwork is working together — even when apart‟.
By: Tanya Chauhan [email protected]
