Market Matrix – Fall of US market by 36 pc and UK market by 39 pc over the year

Friends,

In the aftermath of the second week of bad performance by all world markets, there is loss of thinking power to some extent for the logic is being defied by the fear psychosis in the thinking space of mind. Let us recount some of the facts of the day.

The UP govt has declared SAP (state advised price) for sugar cane for this season as 140 rupees/qtl (up Rs 15). This should be digestible rate for the mills because the sugar rates this season are pretty high and would remain so because the sugarcane production this year is going to be only 120 m/t against 160 m/t in previous year. The unorganised sector is already offering price of cane purchase nearly at the level of SAP or more. There are 132 sugar mills in UP which were operational last year. There will be fierce fighting amongst some of the leading ones to have greater share of cane-crop although there are some rules specifying the area for each mill. The industry would be back in black, and there is no doubt. You should buy your sugar scrip before its too late (please refer to my earlier posts).

Those involved in the accident seem to be hurt less than the bystanders otherwise how would one justify fall of US market by 36 pc and UK market by 39 pc over the year while Japan losing 48 pc and emerging Asian markets losing close to 55 pc. The reverse is going to happen, today or tomorrow. Asian stock will out perform the other markets. I told you earlier and say it again with supporting numbers.

Asian markets performed poorly (26 pc) over the last week while the UK and US markets went up by 3 pc and 4 pc. Shouldn’t therefore markets in India be better this week after losing more than 50 pc from peak. The RBI will have a formal occasion to bring back cheap money policy because loss of jobs and lower economic activity are worse than some extra dose of inflation. As I have been telling time and again, it is utmost necessary to let unearned incomes go down in value but the earned income can not be given a worse treatment. The pensioners too can only share, in whatever proportion, when there is going to be production. The whole economic tension the world over is on account of this factor. Those who follow this site would recall that this analogy was put forth long back and is finding endorsement all this while.

Asian markets have been mixed this morning, may be India performs with some strong opinion favouring bulls.

The latest week did confirm that value buying is emerging as BSE Bankex went up by 4 pc and FMCG,Healthcare and Realty did not lose any further ground in the week gone by.

HariOm,
Krsna Khandelwal

BIRDINFO Stock Rx – A prescription for stock market

Market Matrix – Angle of value in shares quoting low

Friends,

There is some change in the scene today, at least for India. Nifty is trading at 3430 and Nifty futures command premium of 40 points. I am happy to have put forth the angle of value in shares quoting low. If overseas (European) advices show positive movement and the effect is carried forward to USA, there can, perhaps, be an equal and opposite action in market against what happened last last week. The gloom will further disappear with the results of companies that would be coming out in a flood in about a week.

There were some people making hey while the sun was under the cloud last week, I mean the acts of bear cartel at spreading rumours. ICICI Bank was targeted by some entities related with Motilal Oswal Group. It has been clarified that it was doing of some individuals but many a names are being spoilt in this way. In fact people lending ears to rumours should be blamed more for they put life in to rumour. The ICICI Bank has even gone to the extent of filing a police complaint.

It may be that there is overplaying of the tune of disaster and something is being orchestrated by some groups. It is for this reason that at the end of such big drops the further trading happens to be at higher levels even if the bearish times continue. In present case I perceive no weakness of the sort that is being made out for the Indian corporate sector. I would dread only the nose diving of the profitability continuing in to loss making over a year or two. If there is slight drop in earnings and no other technical threat to a company of the type that its technology is getting obsolete,its products are going out of fashion and use or there is rot in management, there should be not much worry.

This however is true when the prices are at low point already. When the stocks sell for fancy prices and at high PE discounting level I do not consider it wise to stay for a minute. Those who care to read my posts in Oct 07 and later would see it as statement of fact and not just a claim after the event.

HariOm,
Krsna Khandelwal

BIRDINFO Stock Rx – A prescription for stock market

Nifty over the years 2001 – 2008

Friends,

The Nifty opening and closing in the October month since 2001 one is as under:

Oct 01 Oct 31 Feb/Mar Peak

2001 910 971 ———-

2002 955 951 1193 (070302)

2003 1420 1555 1070 (240203)

2004 1775 1786 1920 (170204)

2005 2630 2370 2168 (080305)

2006 3569 3744 3418 (300306)

2007 5068 5900 4224 (070207)

2008 3950 ???? 5483 (050208)

You may have observed that in all the years it has closed higher in the end of October with exception of 2002 and 2005. This is an special year and the Nifty has been beat down due to some developments out side India. This year should to a exceptional year as and the nifty should be closing way up this year from current level which is it self lower by 400 points since the beginning of October.

Then there is a continuous phenomenon in all years since Oct month of 2001 till Feb/Mar 2008 which is that the peak in Feb/Mar of each year has been way up over October opening level of Nifty in the previous year. This is without an exception. This is the result of monetary conditions improving in the period since October till the Feb/Mar 08 period. Actually the inventory nursed by industry till the festive season beginning Oct gets diluted and the pressure in money market keeps reducing. As I told you this year is special and may be showing extra-ordinary jump by Feb/Mar. The down side over today’s level is quite minimal due to great loss in values in the past ten months, it has been unprecedented fall. Hope you will prepare yourself for the ‘grand finale’ in good time.

HariOm,
Krsna Khandelwal

BIRDINFO Stock Rx – A prescription for stock market

Market Matrix – Effort at cutting interest rates across globe

Friends,

There is a concerted effort at cutting interest rates across globe. China’s central bank has cut rate by 277 bpa and also has reduced the reserves requirement by 50 bps. US Fed cut rates by 50 bps to just 1.5 pc. BoE and ECB have also cut rates by 50 bps. FED has also cut discount rate by 50 bps to 1.75 pc. This concerted action is being seen after 2001. Since commodity prices have come down the inflation upside has got limited to that extent. FTSE and CAC have come in to green after the rate cut announcement. These are aimed at spurring economic activity which is feared to be slowing down. The RBI has not joined in and should have. Why not be with the world as the same thing is required here to albeit in lesser degree. FED’s rate cut was unanimous. Indian rupee appreciated by 75 paisa to 48/dollar, while the 10 year bond yield has slipped under 8 pc.

Indian market opened way low, went lower as much as Nifty saw more than 200 points loss at sub 3400 level but closed above 3500 points. The measures here and abroad are enough to see transfer of greater amount to Indian banks in the interest of safety by NRIs at least. The fund managers would start looking at India again in new light. I think as and when the RBI cuts SLR and CRR and repo rates, the foundation will have been laid for mother of all bull markets, of this I am sure. Today a cup of tea plus a ‘paan’ costs more than a share of some solid companies. Some other companies with larger bases and with sound businesses have share selling for less than cost of Lunch or Dinner for one or cost of commuting to office/club. Who would mind putting as paltry a sum as this for buying a part of company which has delivered all its life. There are people and people, some come forward at buy at peak of 6200 of Nifty and some shy away buying at 3400 Nifty. Who would say the majority does not consists of fools?

There is an announcement just now that PM has called meeting of cabinet to discuss stressful economic scenario. Let’s see what helpful measure he will announce at end of meeting. India on back of Indian resources and on back of its teaming millions is on march to gaining rightful place, turmoil in developed world is calling for a quick march ahead by India. We require an imaginative leadership and not just the narrow minded politicians like ‘M’ of WB but visionary like ‘M’ of Gujarat.

HariOm,
Krsna Khandelwal

BIRDINFO Stock Rx – A prescription for stock market

Market Matrix – Nifty closed nearly at 3600 level

Friends,

Last week has been one of the most action packed and still has passed without any historic single day fall in any of the markets around the world with an exception of DOW which lost maximum in a day for the past eight year period, if not all time.

Today markets in India have lost further ground, so much so that Nifty closed nearly at 3600 level. This level gives Nifty a PE discounting of just 15.43 and P/BV ratio just 3. These are best ever ratio in the past five years. The analysts used to be talking in term of not the current discounting but discounting at expected earnings for the year next when there was bullish time. I am basing my optimism solely on the asset values (revalued) which are now way up above what is represented by the present share prices in case of most companies barring the Pharma and FMCG. Pharma and FMCG have some intangible assets in terms of brands and patents. If these intangible assets are given values too, there would be the similar case in respect of these sector scrips too. So things are pretty much in favour even after the future being termed as not so rosy from the earnings angle. Besides, the additional capacities would be coming to production in case of commodity players and for the service sector the markets are expanding on a continuous basis.

There is a welcome and timely development that the RBI has announced reduction in CRR by 50 basis points and banks would be reaping rich rewards for the money released in their hands will be without cost and they would be able to lend all these funds at very favourable rates to industry starved of funds. The rupee has weakened further and is going to act as shield for the domestic industry on one hand and would get more rupees in hands of IT companies for the billing in dollars. Exporters will be advantaged too.

The quantum of money is not any lesser in the world of today but the crunch is being felt due to slowing speed of money. This situation has come about due to the mutual distrust of banks. When the money does not revolve fast, the transactions are settled quickly and remain pending. This unnerves those who are out in market for exchange of their assets for money. The situation get gloomier when the need to sell is for meeting some commitment. This is what is plaguing the western world and have rever berations here. This is, however, not an affliction without cure. The US govt has acted very rightly in thoughtfully deciding to exchange money with presently non marketable assets. The central banks are busy increasing liquidity and once the balance turns in favour, which it has to, the reverse will be happening in all markets.In our country however the beaurocrats are reluctant to be bold enough for the fear of getting flak for deviating from the laid down practices. You would remember that I had warned about the hawkish stance of Reddy when the RBI was tightening money supply. The problem today is invited one. The inflation had nucleus some where else not in money supply. I was due to demand for oil and commodities from the growing economies of India and hence was due to a natural readjustment in relative pricing of all things trade able.

The SEBI has now thrown open the doors for the PN route entry for FIIs. The developments which will see markets stabilise are taking shape but the intervening period is frightening due to some rumour mongering and due design of some as always happens. If you take trouble to see the posts in Oct 2007 and Oct 2006, you will appreciate that how early in the day I gave warning signals,explaining things over and over again. I am doing it now also.

For India, exclusively, the cheaper oil would be a great help. The oil bonds released will be imparting liquidity in system.

So, there are a host of welcome developments, only thing is they have to have effect which usually happens with some time leg.

The puts have been offered in market at lower premiums and the calls command higher premium, on interpretation it would seem down the line the there is some hope. The results will further give direction.

HariOm,
Krsna Khandelwal

BIRDINFO Stock Rx – A prescription for stock market

Nifty’s level now and in 2004

Friends,

I have to tell some thing already told in other words. It is about Nifty’s level now and in 2004 when it was 2000 (Jan 04). At 2000 in 2004 the PE used to be around 20 and therefore the EPS worked out to 100. Now we know that during intervening five years there has been average compounded growth of 25 pc/year since then, it would therefore work out to be over 300 EPS now for the Nifty companies universe. Discounting 3820 Nifty ( 3rd Oct 08) at 300 EPS , the PE would be around 13 . This pretty reasonable even in wake of some slow down fears. The presently offical PE for nifty is 16 and is pretty close to our working as there are three month to go before the year is out.

In light of above, it is not for no reason that the Nifty has rebounded four times after touching around/below 3800 level in last four months (latest on 3rd Oct 08).

It is a good point for taking risk. The tranche of Rs 20,000 crs is going to be released in favour banks against farmer’s loan waiver. Further, the RBI may show some efforts at cheaper money availability as the corporates are experiencing fund crunch. The US govt has demonstrated that the monetary crunch should not make jobs disappear, inflation or no inflation. The historic bailout bill was passed with this in mind and ‘main street’ has been spared woes on account of ‘wall street demeaners’. Also, Russia has released one trillion Roubles in the system for this very purpose.

HariOm,
Krsna Khandelwal

BIRDINFO Stock Rx – A prescription for stock market

Market Matrix – These times have no parallel in economic history

By krsna Khandelwal – A veteran market analyst

Friends,

These times have no parallel in history because the economies were not all this big, the communication was not so effective as to let news travel at the speed of light and the trading was never so costless and organised as to impart everybody interested an opportunity to trade in any kind of market ranging from currencies,equities,dated security,interest rate futures,commodities and derivatives of every complexion. In such times and in spite of the regulation of high order (supposedly) the giant amongst all economies USA is facing the kind of financial turbulence of such high magnitude as can not easily be imagined. If things have come to such pass, there ought to be some people responsible to let it happen this way or some others were unable to stop it from happening. The truth and theories will come out only after the dust is settled.

My whole purpose of feeding this blog is to help the ordinary class of investor and money managers on one hand and to record the current economic affairs with equity arena as main reference point for future reference along with my own interpretations and logical conclusions. In this light I observe the following viz a viz the happenings:

-the banking and financial institutions failure in USA has triggered a down slide in equity markets around the world (this is natural outcome of such and event in an integrated world but when it stop and equal or more fierce rally should take place for the such failures necessarily require the central banks to increase liquidity to save the day for the banks etc on brink. The liquidity eventually will take all the markets shooting up)

-the commodity markets have seen bearish times (it is again in the same way that eventually commodities and commodity producers will see brighter times for the demand from consumers is not going to go down, on the contrary the people will find it more desirable to consume more rather than see their money’s worth going down)

-the lending and borrowing for projects will be affected (this will delay the commissioning of the upcoming production facilities hence future competition will be postponed)

-speed of money is reduced because of distrustful atmosphere and disruption in chain (this is one factor that is seeing absence of deployable fund and liquidity crunch in spite of liquidity injection by central banks and this rough patch will be soon removed and normal times will be restored)

-the losses suffered by the bulls are forcing them to offer held stocks to make up for losses on positions and drying up their monetary resource (this proves that further supply of stocks will be diminishing)

-the cheaper crude will be helpful in surplus creation in hands of all (again a good thing for the markets and will keep govt finances in good shape)

-the dollar is strong now (for Indian companies it is an incentive to export more and and import less which is sort of a good factor for share price rise)

-the FII holding in companies is being liquidated ( this is a major cause of Indian markets sliding but this can not go on and would have to stop when prices are lower as PEs would become too attractive for buyer and would create demand and absorption of stocks)

-the deluge is continuing, DOW has lost 449 points on 19th Sept 08 and at today’s level it has lost over 25 p.c. over its Oct 07 high.For economies of low interest this is huge loss which be recovered over decades if the stocks are converted into money and converted in bonds/deposits (India also has lost 40 p.c. Since heady days but there is chance to recover money in both streams ie equities or the dated securities)

-in US too the inflation is high and therefore equities which are falling only may recover lost ground and save your money from loosing value over time (this is true for Indian investors too,gold,real estate may at best appreciate as much as the inflation or less and bonds will not return even an equivalent of the erosion on account of inflation.Here it will be the equity universe that will ensure safety of capital in medium to long term in terms of value.the other benefit comes in form of tax savings which have to borne in other cases)

-the PE for Indian equities on average has come down to about 15 after seeing high of beyond 25 (this is the ticket to secure investing for if the PE goes further down the value of the company concerned will gain in value and if the PEs improve it will show that the re rating is being done.this way the prices keep improving. Supposing that the earning go down, it will see PEs improving rather than prices falling due to value of the enterprise giving support)

-Asian market this morning are in worse mood than DOW has been. This is case of bystanders loosing consciousness seeing an accident on the road. The fear is the worst enemy of the people as it takes away the thinking power in the same way as anger does ( one should think normally, calculate risk and take the plunge for these are special times to make money and provide leadership)

-the crude has demonstrated that it can’t be kept low and has rebounded to 97 dollar/bbl (the crude is now keeping range-bound trading at lower levels and this is just the best thing to happen . In fact present needs should comfortable be met and an incentive for the development of alternative energy sources should remain in tact too)

-Nifty PCR is at low of 0.82 and therefore there is low build up of positions in expectation of huge slide.It also says that put writers have been reluctant to write puts and premium on put has increased.It is therefore the time to enter the market with writing puts and save on cost and enter at a level lower than the prevailing albeit to stomach the premium,for further safety you may buy a lower put.you may sell in the money put option in nifty and buy out of money put option , this way you will gain in market going up but loose only a limited amount. (With your gain in hand you may buy a suitable call and sit pretty)

-when I look at the Nifty universe I find each of the company is a leader in the field and has tremendous asset treasure and in such lines of businesses that have future and the competition to these companies may not be offered by the new entrants unless the entry is with blessing from a company from amongst these.what is wonderful is that none of these companies too leveraged and has been doing with minimal borrowed capital)

-the result season is round the corner and the advance tax payment by corporates has been as much or higher in many cases (this is good tiding)

-there were plans afoot for the capacity additions and these capacities would be ready for operation this year or next ( this will see volume of sales of companies go much higher up,profits have keep pace albeit at lower rate of operating margin for the time being)

-our currency is only half the worth of 2004 when the nifty ruled at 2000 so in a way what we pay is the same value in real terms but hefty addition to companies reserves has taken place during last four years and half (this should make one a firm footed player in market.

-elections are some eight months away but the time has come when the concealed war kitty of most politicians finds way in to markets and percolates, this will make liquidity crunch getting over)

-Chinese market is down 67 p.c. YTD and ours is only 37 p.c. (we stand better chance of negotiating any rough patch without injury)

-the DIIs are buying an equal or more worth of equities than is sold by the FIIs ( the balance when turned in favour by entry of retail people will see continuous up-trend)

-once again I tell you that the volatility at these low level would indicate that market is to shoot up (buy after you notice this phenomenon)

-’Prithvi Veer Bhogyaa’ (an Indian saying meaning the brave will enjoy planets wealth)

With best wishes to you being able to trade profitably with a cool mind and busy hand.

Hari Om

BIRDINFO Stock Rx – A prescription for stock market

Market Matrix – Bankruptcy of Lehman Brothers

By krsna Khandelwal – A veteran market analyst

Friends,

You have been listening to my loud thinking showing incoherence in thought pattern. In fact some unknown big event was about to take place and I was sort of having an inkling. It turn out that Lehman Bros. have filed bankruptcy petition and Merrill Lynch is going to be taken over completely in all stocks deal by Bank of America and the world should feel relieved. Some smaller banks may still go down under. This made the market in rest of Asia unnerved in early morning and we did no better and at one stage Nifty was down more than 5 p.c. but recovered towards end to close lower by a good margin at 4070 still.

In the mean time the crude is trading at 97 dollar/bbl and rupee is almost 46 to a dollar. This has subsided the inflation fears to some extent. So now the balance sheet is with some more positives for the Indian markets but the scary scene in USA is not letting a stabilised atmosphere be established. The DOW is trading lower by more than 300 points and I have to think out of gut rather than mind. So follow your gut feeling and retain guts. My last post should be taken as guidance. In fact it conveyed much of the scene that was enacted today. In fact inflation has been a saviour of India for lack of it would have surely put our banking net-work under strain. Its not that there will be no tomorrow and keep in mind if winter comes can the spring be far behind.

Hari Om

BIRDINFO Stock Rx – A prescription for stock market

Market Matrix – Inflation Paradox

By krsna Khandelwal – A veteran market analyst

Friends,

The inflation number announced today at 11.04% have taken a big toll of market which thudded by over a neat 158 points and Nifty closed at 4347. This level is almost as much as prevailing last year June-July. It was from this point that it had made strides to leap up to over 6300 points by Jan 08. I have been harping on the bull tune for last many weeks and have still find it difficult to change stance. I take this occasion to discuss the impact of inflation in reality rather than take it as a damaging factor without recourse to an analysis about its implication. Please note the following therefore:

1. Supposing the index was rightly priced last year June at around today’s level than without doubt the earnings of the intervening year have added to the book values of shares. If we buy stocks today we are buying the same assets of a company as represented by the share plus the gain of one year by paying the same number of rupees which have lost value by 11% , so in effect this equals buying index (Nifty) at about 3868. It is up to you to decide whether this is a safe level or not while the profit growth on average has been about 12-13% over the year. It is also to be considered that the year ahead would still be posting positive growth not negative growth.

2. If we look at choices with the investors we find that net of tax bank deposit will return only 5-6% per year while the inflation stands at 11%. The same would be the case with other avenues of debt instrument purchase. If the inflation has really to be kept at bay only the bullion purchase would make sense. It will however not beat inflation. The stocks make you owner of some marketable and productive real assets and give you some dividend yield hence are a better choice. The tax would be attracted on both types of gains i.e. on capital gains and on dividend income. The direct purchase of real estate is also not OK after its unprecedented rise in recent past. In fact the real estate is loosing value lately.

3. If you look at the damaging effect of inflation on earning capacities of existing companies, I don’t find it in any way having such an effect. The matter is simple enough. The inventory of companies appreciate hence would not cause damage. The land and machinery also would not harm in any way but reversely would have appreciated in value. The employee costs may go up but this costs just about 10% of the cost of manufacturing. Ad quantum taxes would be making the burden reduced to some extent. The end product prices will be raised , may be not by the same percentage but it will still make the top and bottom line healthier in terms of rupees. The companies that have captive raw material source will benefit out-rightly. The banking companies will see default ratio reduced as the burden of paying the principle and interest will be lower in real terms.

4. When we examine the demand side of goods and services, it may be said that the expendable surplus income of people will reduce after meeting the essential expenditure which will see lower demand for goods that are not essential in nature. Here I may point out that the savings level of Indians is about 35% and this leaves enough cushion in their hands to not postpone consumption and their incomes will be higher too to leave room for increased outlay on consumer durables. Also, the inflation would make them go for buying rather than save due to negative net return on saving the rupee.

5. It is said by analysts that the RBI will have to raise interest to arrest inflation and this will damage the industrial borrowers. Here again please consider the fact that most of the leading companies have very little of borrowing compared to the size of business operation due to last few years having let them earn huge cash surpluses. On the other hand they would now find the return on capital consideration by the new entrants at higher level and check the entry of competition. The competition will find the capital costs also higher and hence would have to shelve plans. The fund raising capacity of exiting companies will only go up due to revised higher valuation of assets making them more competent to increase capacities through expansion and through green field projects.

6.The inflation is considered to be bad because it makes the provision for depreciation not sufficient to replace the ageing plant and machinery. This is also not valid in light of the fact that the total cash generation is far in excess of such needs of the companies and most of the companies are still distributing a nominal part of their PAT by way of dividends and are retaining larger part of profit for business purposes.

7. While we see the high inflation level back in India, we still do not find rupee depreciating that fast viz a viz other major currencies. This only shows that the inflation is prevalent in most of the major economies and hence the parity is maintained. Further the high crude prices get to be benign if there is no more flare up in prices while the inflation keeps it march on. This in a way makes relative cost of oil tend towards the traditional ratio and mitigate the adverse impact of the high oil prices that is felt when the sudden surge in oil price takes place.

8. With inflation the revenue of govt. goes up to and its debt burden gets reduced in real value terms. The revenue expenditure of govt. also goes up but some time leg.

9. You may wonder as who is then affected by the inflation. The worst effect of this is on people who are now living on past savings. This section of society also does not have enough say and hence has to suffer silently. In such a scenario they have to sell family silver at certain times to make ends meet. Who then gains if they loose? The gains comes to the active earning members of society and the share-holders of corporations, so why give stocks thumbs down when it should be the other way round.

Hari Om

BIRDINFO Stock Rx – A prescription for stock market

Market Matrix – Sensex has always shown positive moves in line with the surge in oil prices

By krsna Khandelwal – A veteran market analyst

Friends,

The govt. has bitten the bullet and have raised the petrol prices by Rs5/- per litre and diesel prices by Rs3/- per litre. The LPG gas price for the domestic use cylinder has been raised by Rs 50/- per cylinder. There are some reductions in excise duty and custom duties for petrol and diesel and crude oil. The duty on petrol and diesel is now 2.5% against 7.5% and the custom duty on oil import is down to zero against 5%. In the mean time the international crude oil prices are down to $120/bbl.

The projected under-recovery for FY09 was estimated at Rs 2.45 lac crs. This bail out package works out as under:

Price hike takes care of Rs 21K crs,

Duty cuts take care of Rs 22 K crs,

Upstream assistance from ONGC/OIL Rs 45 K crs,

OMCs absorb Rs 20 K crs,

Oil Bonds will take care of Rs 95 K crs ,

The balance Rs 42 K crs have been left uncovered.

I am happy that he govt. has worked on the suggested lines in these columns but has not taken care of the policy formulation in this regard. The impact of this exercise will not be bad whatever be the stance taken by the market people.I also don’t think that the Congress will have any unpopularity on this score for every body understands the economic imperatives. Congress has lost more ground due to eskewed mannerism which is not likable by any body.

I may tell that Indian economy as represented by Sensex has always shown positive moves in line with the surge in oil prices. In the year 2000 oil was selling for under GBP 20/bbl and the Nifty used to be around 1100 pts and now when the oil is selling for GBP 50/bbl the Nifty has had a closing of 4670 points. In terms of Indian oil basket this holds true. Indian oil basket was $27 in 2002 (Nifty 1000),in 2003 $28 (Nifty 2000), in 2004 $40 (Nifty 2500), in 2005 $55 (Nifty 3500), in 2006 $63 (nifty 4000) , in 2007 $79 ( Nifty 4500) and 2008 $127 (Nifty in Jan 6300 and now 4700).

Do you also see some correlation ? In fact this is only natural for we are still not that automated economy and the developed nation suffer more for the oil rise than we do. I have explained this phenomenon even earlier in these columns. So fear not for the petrol price rise and have faith that the valuations are just right, even on the lower side of the right valuations.

Hari Om

BIRDINFO Stock Rx – A prescription for stock market