Restoring confidence in capital markets is likely to be the strongest starting point for the government in rebuilding the faith of corporate India, Deutsche Equities India strategist Abhay Laijawala said
Mumbai: Although the domestic equities market is down in the dumps now, Deutche Bank on Wednesday said it sees the Sensex offering robust 14% returns, scaling the 18,000 level, from the current lows, reports PTI.
“We are setting our year-end Sensex target at 18,000, implying a 14% return from current levels. At our target, the Sensex would trade at a PE multiple of 13.8 times, a slight discount of 3% to the average multiple at which the market has traded over past 15 years,” Deutsche Equities India strategist Abhay Laijawala said while releasing its India Equity Strategy 2012 Outlook here.
“With a near 19-month monetary tightening cycle expected to reverse in 2012, we believe the classical rate sensitives—banks (though the sector may have to cross the hump of bad loans in the near term) and real estate, together with infrastructure will be the key sectors driving the market in 2012,” Deutsche Equities India managing director Pratik Gupta said.
“We believe that the IT sector may provide investors with a strong hedge against continuing uncertainty in the domestic economy,” Mr Gupta added.
The markets may bottom earlier than expected in February-March if the Reserve Bank of India (RBI) reverses its tight policy stance in the January credit policy, Mr Laijawala said.
“March will be critical for the equity market as the clear direction will be visible. The forthcoming state elections will give the government the long-needed manoeuvrability to address many of the economic issues. We would also expect that the much-needed clarity on how the situation in Europe is likely to evolve will also be clearer by March,” Mr Laijawala said.
He pointed out that major worries for the domestic market are more international than domestic issues. “The continuation of policy paralysis, persistent inflation, and a severe crisis in Europe are key risks,” he said.
Restoring confidence in capital markets is likely to be the strongest starting point for the government in rebuilding the faith of corporate India, he said.
“We see equity investors at two ends of the expectations spectrum, with a dominant majority still nervous and negative on this market despite the precipitous fall and lower valuations,” Mr Laijawala said.
At the end of the second quarter of the current fiscal, Rs24,600 crore of debt was pending restructuring versus Rs7,500 crore in the June quarter and Rs18,000 crore for the entire FY10-11, according to Barclays Capital
Mumbai: The inability of large corporates to service their debt obligations will start having an impact on bank’ profits from the December quarter onwards, reports PTI quoting a Barclays Capital report.
“We expect the credit quality issues from large borrowers to start becoming evident in the Q3 results, particularly in the restructured loans category,” Barclays Capital equity research arm said in a report ahead of the Q3 (third quarter) results, which will be kicked off with the Infosys numbers this morning.
The research draws attention to the pending amounts under the corporate debt restructuring (CDR) mechanism.
At the end of the second quarter of the current fiscal, Rs24,600 crore of debt was pending restructuring versus Rs7,500 crore in the June quarter and Rs18,000 crore for the entire FY10-11, it said.
According to a StanChart report, however, this figure is going to hit a whopping Rs50,000 crore this quarter if the Air India, GTL and Bharati Shippyard CDR proposals go through.
“Going forward, we expect it to increase further based on recent news flow on banks referring their debt to Kingfisher Airlines, Bharati Shipyard and others for the CDR process,” it said.
On other key parameters, banks will post stable net interest margins for the quarter even as business growth will be slow, the Barclays report said.
Banks are also expected to report muted fee incomes due to the slower loan growth and lower incremental sanctions, it said. All the lenders, except IndusInd Bank, are yet to come out with their numbers for the December quarter.
Why do we consciously or unconsciously seek the authority of the Caucasian to demonstrate our own ability to operate in the modern world? Are we world-class only if we dress European?
Here I was going through the boarding gate, handing over my boarding card to the boarding inspector. I suppose that is what he must be called since boarding was what we were doing, not like pirates and corsairs leaping from the rigging lines onto the merchant ship, for they scarcely sought permission, but here we were being polite and requesting permission to come on board.
Anyway from the corner of my eye I saw a poster mounted on a stand. It featured a pretty girl, perhaps four years or so, of that age when tooth fairies make frequent appearances. She held in one of her little hands a palette. She looked quite professional and adept, and she well may have come from a long line of painters. In the other hand, she held a brush which looked poised to turn the air vermillion or cerulean or magenta or one of those colours that only painters and women can identify.
The purpose of this very posed and poised picture was to tell us, the ‘boardingers’ or boarders that this was the entrance to Gate 5 and 5A. I was impressed.
But what I found particularly interesting apart from this vital piece of information (God forbid that we had boarded the wrong ship), was that this girl was blond and blue-eyed, possibly of Scandinavian stock, though at the moment I can’t remember the name of a really good Viking painter from whom she may have descended.
Given that I was in south India where Dravidians ancient occupants of this land were the predominant genetic strain, with nary a Caucasian chromosome to offer, I was struck by the anachronism of it all. Surely ebony would have worked as well as ivory, I thought.
And then it hit me. I winced.
In the airline business in India it seems that western dress and western mores are better semiotic signals of efficiency and professionalism than the vernacular, the home grown ethnicity of costume or even face.
To that end we have an airline which features a very pretty model, not even a flight attendant giving you the flight safety instructions on a video screen. She is Czech I believe. She is as white as porcelain alabaster and I would venture that she doesn’t know Hindi, though she has been well rehearsed and the dubbing and lip-sync are quite commendable. Of course I am not sure that featuring her gave me any more confidence about the procedures in the event of engine failure, de-pressurization, landing on water and the consequent fastening of life jackets and emergency whistles. But I must confess that she looked pretty in an orange vest.
Then there is the other airline which has each female flight attendant, (I used to call them hostesses which was a lot more friendly than the functional attendant, someone who I expect to see mostly manning toilets, but be that as it may and it is not germane to this ramble at all) coiffured with a wig cut to resemble a model’s hairstyle from Paris. I am no connoisseur of women’s hairstyles but they resembled to my untrained eye the cut of Audrey Hepburn’s hair in Roman Holiday. Sort of a cross between a bouffant and a page boy, I would think. (Here I am impressing you with these terms!)
They also wear dark suits and stockings. This airline has positioned itself on punctuality, and I suppose these replicas of women from Paris in Coco’s era help in that delivery of customer satisfaction.
On the other hand there is the so called national carrier. Stained by age and possibly indifferent neglect by bureaucrats who have no business sailing any ship whatsoever, they have like many fat merchant galleons of yore been boarded again and again by privateers and so now languish, awaiting fair winds again.
Their maids of delight are dressed in colourful Indian costume, wear their hair in an Indian coiled bun, if they have long hair, and are generally of a slightly older average age than the other airlines’ staff.
The airline itself is not particularly efficient, but when on board these flight attendants perform with better efficiency and courtesy and maturity. But that is possibly my parochial point of view.
My actual point is why do we consciously or unconsciously seek the authority of the Caucasian to demonstrate our own ability to operate in the modern world? Are we world-class only if we dress European?
The cheongsam of the Singapore Girl may argue against this notion.
But it may just be that dressed this way or that we just can’t be as good when it comes to service, mass produced and delivered. So we compensate our imagined inadequacy with costume.
We are a truly exceptional people when we offer and proffer our individual hospitality in our houses and our homes.
Maybe we don’t know how to make a business of it.
(V Shantakumar is the former chairman & CEO of Saatchi & Saatchi in India and now the managing partner of Doing Think)