The 5 I's that spook the market

Consultants, marketing teams had their own sets of 5W, 3Cs and 5Cs, time for something in finance, the 5I's

1. Inflows
2. Interest Rates
3. Inflation
4. International reasons
5. Inaction from the government 

Hats off to the CMD of IDFC securities. :)

http://www.business-standard.com/india/news/qa-nikhil-vora-md-idfc-securities/433099/

Why do companies Delist

A friend today asked me why would companys like Blue Dart etc de-list, i dint know the answer, searched for it and some googling gave the following possible reasons, any more possible reasons for the same are welcome

1. High promoter holding say 70%, will lead the promoters to think, why comply with all the listing requirements quarterly publishing of results, communication, analyst questions etc for the remaining 30% of the shares only, better to keep it in our own hands
2. If the company has now further plans of raising capital, then it might not make sense for them to remain listed, like most of the foreign MNC do for their Indian subsidiaries, when they feel that no more capital will be ever required by the business, they go for de-listing.
3. A company feels that they are undervalued and after trying to communicate the strength of their projects to the market, the fail to elicit the valuations, it would be better for them to de-list and rather go in for a PE funding/Private transaction in case future capital is required because the deal value will not be biased by the CMP.

The making of another Hazare

China to quadruple desalination capacity

http://www.thehindubusinessline.com/industry-and-economy/economy/article1645209.ece

KEC International forays into water treatment business

http://www.thehindubusinessline.com/companies/article1612223.ece

Chemical process piping aims at Rs. 100cr revenues by fiscal end

http://www.thehindubusinessline.com/companies/article1618182.ece

All three articles relating to what acute water shortage is going to happen over the world in the coming years. I guess it can be one of the big macro themes in the coming years. But what might happen if such a things does happen

The smart capaitalist

1. Enter the business seeing huge opportunity as the first mover
2. New technology innovation happens, leading to lower cost of desalination and more business share.
3. Identifies and profits from the opportunity

Others/Non Capitalists/News followers

1. Reads Anna Hazare going on fast, abuses the nation, tweets and India yet again records 4.4 million tweets
2. Cant all those people who tweet or go in the candle light marches be told about capital markets and financial education, and be reminded that markets provide an excellent time to buy stocks at these times and show the world the believe of Indians in their economy.
3. Be reminded time and again of the numerous commissions that have been formed every time somebody goes on fast and draws so much attention. Would it not make sense for them to see what happened to the Kirit parikh report, dumped and thrown. What good what a committee do? Does Anna thinks he achieved his goal by getting a committee formed?
4. Be reminded, that wise decision are to be made in the electoral process, if Anna can go on fast, cant some one supporting him stand for the elections and bring about the change that they speak about on tweets. It is easy to blog/tweet.

Few - Extensive - Neglected

The chart below depicts the share price of INDOBORAX at the end of each quarter along with the EPS recorded in each quarter. Some interesting points about the graph

1. Phase 'FEW': During the period 2005-07, the spike in the price used to happen one quarter before the EPS announcements, the stock was covered but not extensively


2. Phase 'EXTENSIVE': During the 2008-09 period the stock began to get a lot of attention, the price went up 1 year in ahead of the EPS


3. Phase 'NEGLECTED': During the 2010-11 period, the stocks is not followed, no aggressive expansion by the management, well they dont need to, there plant is running at 45% capacity only, people loose interest, the price moves after the EPS has been announced.

Interesting Graph!!