Friday, August 31, 2012

TO EARN PROFITS, ATTRACT INVESTORS!

Global Investment Guru Jim Rogers, who Co-Founded the Quantum Fund along with George Soros (The Fund Returned 4,200% in ten years, as compared to the S&P 500’s 47% in the same duration), believes that commodities are a strong investment avenue for indian firms, and that the govt. should cooperate to make india inc. more profitable

When the economy gets better after the ongoing recovery mode, commodities will go up. And even if it doesn’t get better, commodities will remain the hot favourite, as governments would press to print more currency and whenever the government has done that in the past, real asset prices tend to go up, be it rice, wheat or natural gas. In the present situation, a credible investment and productive capacity for 25 or 30 years in the commodity field will be excellent whether the economies get better or they don’t. Most of the commodities tend to be fruitful but for the near future that is 2 to 3 years, agriculture will be a golden call.

With the recent mergers and acquisitions (M&As) activity heating up the Indian market, like any other economy, Indians are shelling-out a little extra for the target company. But these M&As are of no sense as they normally destroy value. Forget about making-profits with these deals. If an Indian company can, it should rather invest in the stock market over M&As as there is a lot of liquidity in the Indian market and a huge potential in stocks. So stocks are the right way to go if you want to make profits.

Talking about the comparison between India and China, when returns are considered, the Chinese market will outperform India in the short-term, but with India allowing foreigners to invest in the Indian market, India will be a much better market in comparison to China in the long-term. But considering the manner in which the government behaves and acts on important economic and corporate decisions at present, I am not really sure that the government in India actually means good. But if it does, India is really the place of more interest. Hence, for the time being, China is the preferred destination and Chinese companies would be my desired targets.

Talking about profit-making in the farm & agricultural sector in India, at present, a lot has to change. There has to be definite reforms in different sectors in India to unlock their potential specifically in agriculture, where India can be a leader in the global economy, as India has the soil, weather & location. Unfortunately, the government is ruining agriculture with all kinds of restrictions and despite thousands of Indian farmers committing suicide every year, the government is allowing the restrictions to develop. A farmer in India cannot have more than 5 hectares of land and these Indian farmers can never compete with their counterparts sitting in Australia and America. A farmer in India has the potential to own 10,000 hectares. The Indian government should open up the agricultural sector, so that it becomes much more competitive.


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Thursday, August 30, 2012

THE CAPTAIN OF THE SOUTH KOREAN SHIP

AFTER BEING THE CLEAR #2 IN THE INDIAN PASSENGER VEHICLE SEGMENT FOR OVER 11 YEARS, THE TIDE SEEMS TO BE TURNING IN FAVOUR OF ITS CLOSEST COMPETITORS. CAN H. W. PARK, THE CAPTAIN OF THE SOUTH KOREAN SHIP, STEER IT CLEAR OF THE MANY ICEBERGS ON THE WAY? BY PAWAN CHABRA

The market leader has even announced a plan to stage a comeback in the Indian market, starting with the launch of the Alto K10, coupled with five CNG models (of the SX4, the EECO, the WagonR, the Alto and the Estilo models), and the automatic A-Star. But even Shashank Srivastava, CGM – Marketing, Maruti Suzuki India, confesses, “A lot depends on how many units of the Nano does Tata Motors plan to sell in the Indian market.”

The issue of capacity crunch is also keeping many Hyundai investors on tenterhooks. Currently, its Sriperumbudur (Chennai) plant, with an annual manufacturing capacity of 600,000 units, is operating at full capacity. But as insiders quote, the auto major has an option of stretching it to 670,000, by modifying the assembly lines. The worrying fact is – Hyundai has not revealed plans to do that. Hyundai’s Saxena says, “If there is more demand for our products, we will possibly look into it. But I don’t think there will be a need for capacity expansion this year, perhaps not even in 2011.” But despite this, Park has good news for his investors.

Hyundai will land some hard punches on its competitors with the launch of its small car (reportedly scheduled for 2012), that will be positioned in the A2 minus segment, which would then be in direct competition with the Alto. The product is expected to bring high volumes to the company, which will then help it claw back market share in the domestic arena. Park reveals, “We are in the development stage of the model and it is going very well. However, I can’t comment on the time frame of the launch in the Indian market,” says Park. To this, Saxena adds, “While our small car will not compete with the Nano, when we are looking at such a model, we are looking at high numbers...”

Most likely, even though Tata Motors will again displace Hyundai as the #2 player for some more quarters to come, one cannot deny that Park still leads one of Hyundai’s most profitable overseas subsidiaries, which is also the #1 exporter of passenger cars from India, with exports of 285,658 units in FY2009-10 (64% market share in exports, while Maruti and Tata command a much lower 33.1% & 1.5% respectively). In fact, production figures prove how after Hyundai China (production volume of 570,309 units in 2009), the Indian subsidiary, with an output of 559,880 units in 2009, is the most important for the Chaebol.

Whether or not Park manages to retain the silver sceptre, the domestic market will remain key to Hyundai’s future. With the domestic market size growing by the day, fragmentation is inevitable. He has to focus on profitable volumes (and not ranks), with the key adjective being ‘profitable’ (given that currently, for every Nano that Tata Motors manufactures, it makes a loss due to capex depreciations). Park’s job as a CEO is to keep the volumes high and profits thick. For now, he is doing that. Tata Motors may focus hard on the Nano and critics may write volumes about how the product will ensure a second spot for Tata Motors, but experts opine that such low-priced products with wafer-thin margins, can hardly give companies a sustainable lead. There will be much more botheration for Park over the next couple of years in the form of Bajaj-Renault’s ultra low-cost car, FIAT’s model below the Punto and Volkswagen’s small car. But he needs to remember that increasing capacity is key, focusing on the Indian market with good margin products is important and keeping his investors happy (with profits) is religion. And for the sake of this religion, Park should not fret over giving away the runners-up trophy.


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Wednesday, August 29, 2012

Style Police catches Sonam!

Sonam Kapoor’s co-star in Saawariya, Ranbir Kapoor, consciously toyed with the imagination of women as he danced with just his towel on, but Sonam herself recently came close to some inadvertent skin-show. At a promotional event organised for her upcoming film Aisha, Sonam nearly had a wardrobe malfunction incident, when it was noticed that she was having a rather tough time keeping her pants on. For someone who has been working very hard on being a style diva, such an event would’ve been disastrous!


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Friday, August 24, 2012

Fathers in India are still pitted against rigid ancient laws

A hundred years after Father’s Day was commemorated, fathers in India are still pitted against rigid ancient laws and struggling for equal right over their children...

“It is almost impossible for Indian fathers to get custody of their children,” said Satya Kumar, Founder of 498a.org. “The Hindu Marriage Act is of 1955. The laws are very ancient. When the laws were written, only 1% of the women worked while now about 25% work. Kids in the custody of working mothers are no better taken care of than kids living with fathers. The mindset of people needs to change. There should not be women’s right and men’s right but the government should implement common family rights,” suggests Kumar.

“Father’s day, Mother’s day or any other such day is just another opportunity to show your love for each other. At times, the occasion can present a chance to patch-up things, to clear the muck and start things afresh,” says Dr. Sanjay Chugh, Senior Consultant Psychiatrist. Perhaps that’s why one of the demands being made by AIMWA is that ‘when a person or couple approaches court for divorce, counselling of the parents by professional counsellors should be given first priority.’

This Father’s Day, let’s hope that it doesn’t take another hundred years for fathers to get their due.


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