Citizens' Issues
India tops list of drone-importing nations
India's first UAV delivery came from Israel in 1998. The UK, on the other hand, imported its first UAV in 1972 from Canada. But Japan was the first country in the world to import a UAV, it got one from the US in 1968
 
The decision by India's National Disaster Response Force to use drones to help Nepal map the scale of devastation caused by last month's earthquake indicates how India has enthusiastically taken to these pilot-less aircraft -- the so-called eyes in the sky.
 
With 22.5 percent the world's unmanned aerial vehicle (UAV) imports, between 1985 and 2014, India ranks first among drone-importing nations, followed by United Kingdom and France. UAVs, or drones as they are commonly known, are pilotless aerial vehicles used for reconnaissance, surveillance, intelligence gathering and aerial combat missions.
 
The advantage of UAVs is that they come at a fraction of the cost of manned aircraft with no risk to human lives. The data here relate to drone/UAV transfers (imports/exports) between countries. There are also drones that have been indigenously developed, so the actual number of UAVs possessed by each nation may be different.
 
A total of 1,574 UAV transfers have taken place across the world between 1985 and 2014. Of these, 16 are armed UAVs, according to data provided by Stockholm International Peace Research Institute (SIPRI), an independent global conflict-research institute.
 
UAV trade recorded an increase of 137 percent between 1985 and 2014. The period between 1985 and 1990 saw sales of 185 UAVs globally, which increased to 439 between 2010 and 2014. Egypt and Italy are among the other large importers. The last decade also registered sales of 16 armed UAVs.
 
India's first UAV delivery came from Israel in 1998. The UK, on the other hand, imported its first UAV in 1972 from Canada. But Japan was the first country in the world to import a UAV, it got one from the US in 1968.
 
India's UAV imports, have almost all been from Israel, according to SIPRI data. Of 176 UAVs, 108 are Searcher UAVs and 68 are Heron UAVs. Israel is the leading exporter of drones, accounting for 60.7 percent 1985 and 2014.
 
The US, with a 23.9 percent of UAV exports, ranks second, followed by Canada with 6.4 percent. Israel shipped has shipped 783 drones since 1980.
 
Some of India's eyes in the sky:
 
Netra: An autonomous UAV developed jointly by ideaForge Technologies and Defence Research and Development Organisation. Can take off and land vertically, like a helicopter. It can also fly and return to base on its own. Currently used by Indian armed and paramilitary forces.
 
The National Disaster Response Force used the Netra drone during the 2013 Uttarakhand floods to identify survivors and assess damage. It was also deployed during the Bhuj floods in 2013 by the Gujarat government.
 
Nishant: Used for day/night reconnaissance, target tracking and extraction of target coordinates, artillery fire correction and damage assessment. Nishant is being inducted into the Indian army, with 4 UAV units.
 
Panchi: Wheeled-version of Nishant. Capable of taking-off and landing from small airstrips. First flight in December 2014.
 
Rustom I: All-weather, medium-altitude, long-endurance UAV. It will operate at medium-to-long ranges and gather near real-time high-quality imagery and radio signals. It will perform a range of military missions.
 
Rustom II: Being designed to operate at up to 30,000 feet for 24 hours at a stretch.
 
Aura: A combat drone capable of flying at 30,000 feet and launching missiles, bombs and guided missiles.
 
Lakshya: Remotely operated and used as a target to train gun and missile crew and air-defence pilots for the three services.
 
Armed UAVs were exported for the first time in 2007, when US delivered two MQ-9 Reapers to the UK. The MQ-9 was used by the UK forces in Afghanistan. China became the second-largest exporter of armed UAVs in 2014, when it delivered five drones to Nigeria, which deployed UAVs against Boko Haram, a terrorist outfit.
 
Drone attacks have been criticised around the world for accidentally killing civilians while hunting suspected terrorists. More than 2,400 people (273 civilians) have been killed in 390 drone attacks in 5 years (2009-14) under the Obama administration, according to a report by The Bureau of Investigative Journalism.
 
The use of drones/UAVs in India is mainly confined to surveillance and reconnaissance, unlike the US, which uses armed drones in Pakistan, Afghanistan and Yemen, according to Sameer Patil, associate fellow on national security, ethnic and terrorism studies at Gateway House and former assistant director at the National Security Council Secretariat in the Prime Minister's Office.
 
Drones used along the India-Pakistan border are simpler than the ones used on the Chinese border in Ladakh, where they require long endurance and high-altitude capability, Patil said.
 
UAV squadrons in India mainly operate with Herons and Searcher MK IIs from Israel. However, there are also some UAVs/drones that have been indigenously developed or are under development. As use grows, more drones are coming, also the armed ones.

User

Making a mockery of Nifty?
Bosch, with a P/E of 67.9, gets included in Nifty. Market players react with shock. Some smell manipulation
 
India Index Services & Products Ltd (IISL), a group company of National Stock Exchange (NSE) that manages CNX Nifty and other indices, decided to include Bosch Ltd in the elite 50-stock benchmark removing IDFC Ltd from 29th May. While the Index Maintenance Sub-Committee at IISL takes such decision on periodic reviews, the question is how did Bosch, one of the most expensive scrips, with a price-to-earnings (P/E) ratio of 67.9, get included in the benchmark index. Was it done to boost volume, price of Bosch or is there any other reason? Some smell manipulation given the funny names that are included in various NSE indices.
 
The charge is serious because so is the implication of this move. They simply cannot avoid an index stock. For instance, index funds are required to hold all the scrip in an index in the same measure as its weight in the benchmark. Exchange-traded funds have to buy Nifty stocks to track the index. Even mutual funds benchmarked to Nifty index have to buy most of index stocks so as no to move to far away from the index. 
 
The question is, when all this institutional money chases Bosch out of compulsion. Will all of these investors get enough of shares of Bosch to buy? A wise and experienced market player Prasanth had this sarcastic comment to make about this startling move by NSE. 
 
When his sacrcam fell flat he had to clarify.
 
On Wednesday, just 1,627 shares of Bosch were traded. Not only is the Bosch counter very illiquid but the stock is horribly expensive too. In essence, by this one move, NSE will force institutional investors to make an extremely expensive stock even more expensive. This move is so bizarre that it almost smells of manipulation.
 
 
Indeed, as Moneylife has written in the past even a hollow, scam-ridden company like Himachal Futuristic is included in NSE500, for reasons best known to NSE. (Read: Why is Himachal Futuristic in the elite list of CNX S&P 500?)
 
Bosch scrip recorded its 52-week high at Rs27,990 on 20 March 2015, while its 52-week low was Rs10,300 as on 5 May 2014. Even among its peer group companies, Bosch is the most expensive scrip at a price of Rs22,710 per share and a market cap of Rs19,566.10 crore as on 30 April 2015. The second most expensive scrip in this peer group is BEML Ltd at Rs982 per share and a market cap of Rs1,849.93 crore as on 30 April 2015. While the PE ratio of Bosch is 67.29, the same for BEML is 14.94. On the valuation issue, here is a comment from another astute market player.
 
 
Even the price-to-sales ratio (PSR) of Bosch, compared with peer group companies is extremely high at 6.89. 
 
Earlier, while responding on criticism about choosing index stocks, NSE had said, “The top 50 companies listed on the NSE that satisfy the criteria related to market capitalisation, liquidity (impact cost), floating stock and minimum listing criteria are considered for inclusion in the index.” 
 
At the same time, IISL, while replying to a query on rationale for giving a company index representation, had said, “companies are reviewed based on market capitalisation, liquidity (impact cost), floating stock and minimum listing criteria. Profitability is not a current criterion. In case, one was to introduce profitability as a criterion, all companies with long gestation periods (infrastructure, telecom, etc) would not be eligible for inclusion in the index. In such a case, the resultant index would not be truly representative of the underlying market.” 
 
Interestingly, Bosch, a profitable but illiquid company was first included in Futures & Options (F&O) segment a few months back, preparing the ground for its eventual inclusion in Nifty, as part of a well-thought out plan.
 
    
 
NSE and BSE have earlier stood exposed for selecting dubious operator-driven scrips for the F&O segment. (Read: SEBI slams down on F&O manipulation-II: NSE and BSE as the first line of regulation stand exposed)
 
Another astounding aspect of Bosch is its absolute value. Each stock is worth over Rs22,000, which hardly any retail investor can afford to buy. Why include such a stock in the flagship index dominated by Bharti, Reliance etc.? 
 
Following the inclusion of Bosch in Nifty, its share price increased by about 3%, while IDFC's price dropped by a similar percentage. IDFC, which closed Thursday at Rs168.25 on NSE, has a P/E ratio of 16.43, price-to-sales ratio of 3.01 and RoI of 3.44.
 

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COMMENTS

Ralph Rau

2 years ago

This is so shocking one is left speechless.

It will destroy the confidence of investors in the index and hence in the markets.

Then again it will serve as a caution to investors not to invest in any Index fund.

VGANESAN

2 years ago

Buy the undervalued stock removed from nifty and sell the overvalued stock included in the nifty.Historical evidence suggests stocks removed from index has done extremely well if belongs to quality.Example ranbaxy colgate arvindmills idea cellular These companies have done excellent job after removing from the index.

Mitranand Financial Services Pvt Ltd

2 years ago

This is not first time remember how foolishly they added United spirits and removed later on. Indices should be represented as parameter of economy and give weightage different sector of economy irrespective of Under or our performance.

Nifty under pressure, Bank Nifty steady – Weekly closing report
Nifty may rally, only if it closes above 8,300
 
The S&P BSE Sensex closed the week that ended on 30th April at 27,011 (down 427 points or 1.55%), while the NSE’s CNX Nifty closed at 8,182 (down 124 points or 1.49%). In the previous week, we had mentioned that the 50-stock Nifty is close to short-term bottom and close above 8,400 will mean a short-term rise.
 
Nifty witnessed a weak move on the first day of this week, pulling stocks lower to hit its lowest since 9 January 2015. Nifty closed at 8,214 (down 92 points or 1.10%). In a move favouring foreign portfolio investors, the Central Board of Direct Taxes (CBDT) said it would settle all minimum alternate tax matters of foreign institutional investors coming under the ambit of Double Taxation Avoidance Agreements (DTAAs) within a month of filing of claims.
 
On Tuesday, after moving in the red for most of the session, towards the end, Nifty gained momentum and closed in the green after three days of being stuck in the red. Nifty closed at 8,286 (up 72 points or 0.87%). SEBI chief UK Sinha said that the market regulator is expected to take at least around six months to decide on the listing of stock exchanges but after the merger of Forward Markets Commission with it. World Bank said that India's economy may expand by 7.5% during the current financial year.
 
The 50-stock Nifty closed Wednesday at 8,240 (down 45 points or 0.55%). The Union Cabinet approved the proposal to set up 100 smart cities across the country. In addition to this, old housing projects initiated by the previous government have also been cleared.
 
On Thursday, Nifty witnessed a highly volatile session due to expiry of April futures and options (F&O). The benchmark closed at 8,182 (down 58 points or 0.71%). US Federal Reserve, after its two-day meeting which concluded on Thursday, offered no changes to its zero interest rate policy and showed no new guidance on the timing of the rate hike.
 
The Indian government reportedly withdrew proposals to set up an independent public debt management agency and strip the central bank of authority to regulate government bonds. Finance Minister Arun Jaitley said in Lok Sabha during a discussion on Finance Bill 2015 that the government would instead consult the Reserve Bank of India (RBI) and come out with a detailed roadmap for a new debt management agency.
 
India's stock market would be closed on Friday, 1 May 2015, for Maharashtra Day/ Labour Day.
 
Out of the 27 main sectors tracked by Moneylife, top five and the bottom five sectors for this week were:
 
 

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COMMENTS

LALIT SHAH

2 years ago

Nifty April close negative daily charts almost oversold.may bounce but weekly monthly shows clearcut bearish trend nifty likely to settled in between 7500-7000 or in worst conditions 6300 about in 2014 may HOPE journey started now comming to reality in leadership of visiting prime minister.common public feeling mohbhang. Loot fat ki SARKAR taxes rising tours increasing. FII PACKING $ WILL TEST 66 ON 66 BIRTHDAY OF P.M.
HAVE NICE DREAMS

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