Posts Tagged ‘stock market’

INDIAN ECONOMY – GAINING STRENGTH Part 1

Stock market reflects & discounts the overall conditions in the economy.Besides, stock prices in the market are also governed by the investor behavior & valuations. Sometimes investor’s optimism takes the market valuation to a level that it does not matches up with the actual future growth, thus becoming the basis for correction & vice- versa. It is said that “ markets may remain irrational till the life of human being”. Now let us have a look at the economy to see what lies in the future & how it is shaping up for the next leg of growth.

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Indian economy is expected to grow by 7.2% in the fiscal ended on 31st march 2010 & is projected to expand by 8.55 in the current fiscal year and 9% in the next year. The continued improvement in the sentiments of the manufacturing sector which currently contributes around 15% in GDP is likely to play a major role in taking GDP growth to double digits.

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Strong industrial recovery has been the key underlying strength behind the recovery of GDP. During April- December 2009, the index of industrial production (IIP) increased by 8.6% over the corresponding period. Factors that will drive the growth in the industrial production are:

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  • Improvement in agriculture output- Tokyo-based Research institute for global change has predicted normal monsoon rains in india for the current year. On the belief of climatic conditions will remain normal during the year we expect the improved availability of agricultural output to push up production of manufactured food products..

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  • Rising consumer demand – as the business conditions are improving & corporate are giving wage hikes, we believe this will strengthen the sense of financial security in the minds of urban middle-class. A rise in purchasing power and availability of easy and affordable loans are expected to increase the demand for durable goods like auto, consumer appliances.

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  • More availability of mining products- we expect natural gas & crude oil output would increase as the result of the efforts that are being done by companies like Reliance & Cairn India. Coal Production will also rise owing to the allocation of new coal blocks by the government. Fertilizer & Electricity sector would be the key & direct beneficiary with the improvement in the gas & coal availability.

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    Stay tuned for more on this 🙂

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    GM (GENETICALLY MODIFIED) CROP

    What is a GM crop?

    As the name suggests, a genetically modified crop is produced by bringing about a change in the genetic structure of the plant. Essentially, the term refers to food sourced from plants (or animals) whose DNA has been engineered –artificially altered in a way that does not occur naturally. In conventional hybridisation, two or more varieties of the same crop are cross-bred, through cross-pollination or some other method, to develop a hybrid variety with some desired characteristic.

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    Where the world stands…

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    Planting of genetically modified crops fell in Europe in 2009, as countries elsewhere increased adoption, and in the most significant breakthrough China approved biotech food crops for the first time. In November 2009 there was a landmark decision when China issued bio-safety certificates for biotech insect-resistant rice and phytase maize. Germany discontinued its planting. Spain planted 80 per cent of all the Bt maize in the EU in 2009 and maintained its record adoption rate of 22 per cent from the previous year.

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    What are their advantages? 🙂

    Ensuring an adequate food supply for this booming population is going to be a major challenge in the years to come. GM foods promise to meet this need in a number of ways:

    • Pest resistant: Crop losses from insect pests can be staggering; It is beneficial for the farmers to reduce their cost of production by avoiding using tons of chemical pesticides annually. There are also healt benefits for the consumers do not wish to eat food that has been treated with pesticides because of potential health hazards.

    • Disease resistance: There are many viruses, fungi and bacteria that cause plant diseases. Plant biologists are working to create plants with genetically-engineered resistance to these diseases.

    • Cold tolerance: With this antifreeze gene, these plants are able to tolerate cold temperatures that normally would kill unmodified seedlings.

    • Medicinal Use: Another potential use of GM foods is to create plants that are modified to contain vaccines against common diseases as an effective and easy means of immunization against these diseases, especially in third world countries.

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    Bt Brinjal experience in deep freeze

    A US based multinational agricultural biotechnology corporation had promoted GM crops in India through Mahyco-Monsanto Biotech. Bt cotton was the first transgenic crop to be released in India in the year 2002. Bt Brinjal is a trans-genic variety developed by inserting a gene (Cry 1Ac) from the soil bacterium Bacillus thuringenisis (Bt) into brinjal. There were many debates taking differing views on the matter. While a section supports it as it gives the plant resistance against insects like brinjal fruit and shoot borer, another section is opposed to it raising concern about the impact of a possible cross-pollination between Bt and ordinary brinjal and the consequences there upon. They also fear about the long-term impact on human health in the absence of long-term trials on the new variety.

    The government’s Genetic Engineering Approval Committee (GEAC) cleared Bt brinjal for commercial release in October last claiming that it would result in lower usage of pesticides and higher yields. Finally, on February 9, 2010 the government of India officially announced that it needs some more time to release Bt brinjal.

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    Are GM foods safe?

    Different GM organisms include different genes inserted in different ways. This means that individual GM foods and their safety should be assessed on a case-by-case basis and that however, the lack of evidence of negative effects does not mean that new genetically modified foods are without risk. GM foods currently available on the international market have passed risk assessments and have been judged safe to eat, and the methods used to test them have been deemed appropriate.

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    In addition, no effects on human health have been shown as a result of the consumption of such foods by the general population in the countries where they have been approved.

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    News

    The government will continue to monitor the release of genetically modified (GM) crops, at least until 2012, said officials in the science ministry.

    Stay Tuned for More updates :)

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    Note : For More Latest Industry, Stock Market and Economy News and Updates, please click here

    How To Get Started in Online Investing? Final Part

    Hello Friends here we come up with an extension of our previous blog “How To Get Started in Online Investing?” Part 1.

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    How To Get Started in Online Investing?

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    In previous blog, we have touched upon the questions, any beginner investors do have in their mind while going for investing.

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    At the same time we had also tried to look in previous blog that what is Online Trading, resources needed first of all to invest online, few steps to start investing online and how SMC ONLINE helps investors in reaping the benefits of online trading.

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    In this Blog, we would try to discuss about what are the further steps an investors need to take once the initial registrations are done with.

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    Once the registration formalities are done with, you would be required to load your online investing trading account with funds.

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    Once Funds would be deposited you would need to look out for the stocks on which you would like to invest prima facie.

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    One thing you should bear in mind that before investing, you should do the in-depth research about the company’s profile, performances and services.

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    In this respect investing firms like SMC ONLINE comes to your rescue usually by helping you with their excellent research support, stocks recommendations and quality statistics.

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    These things are really very important while you invest in buying the shares of any company.

    As a wise investor you should keep your eyes open, and don’t blindly trust anyone.

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    Another very important thing is RISK FACTOR.

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    You’ll have to take the risk in terms of investing your money in the stock market.

    Stock market is a bit similar to gambling.

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    But there is a big difference between the risk and calculated risk.

    For a beginner, you should only go for calculated risk.

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    Don’t put your entire money in terms of buying the shares of a new company, even if the future potential of that company seems very high.

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    Start slowly, understand the market, earn some decent amount of money first of all and then go for big trading.

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    Once you have gotten started, you should start by learning a little bit about chart reading.

    If you can read the charts you will have a good idea what is going on.

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    And as I said earlier, I would conclude this topic by saying that any beginner investor should look for a broker firm that gives good value for money with their commission fees.

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    Stay Tuned for more and more on this 🙂

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    However For More latest Industry,Stock Market and Economy News Updates, Click Here

    Domestic Economy Rolls as Corporate India Offers 40% More Bonus Shares

    Domestic Economy Rolls as Corporate India Offers 40% More Bonus Shares

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    Issue of bonus shares by Corporate India to its shareholders in the first 10 months of the fiscal has shot up 40% over the total during the fiscal ended March ‘09, after declining for two straight years.

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    This interesting jump in bonus issues indicates positive sentiment of the corporate sector to serve a larger equity base.

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    Companies like Britannia, TCS, Reliance Industries, Adani Enterprises, Jindal Steel, Divi’s Lab, JP Associates etc  have  issued bonus shares in the April ‘09-January ‘10 period.

    There are as many as 61 companies which have done so.

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    Jagannadham Thunuguntla, equity head with Delhi-based merchant bank SMC Capitals, said:  “The increase in companies doling out bonus equity to its shareholders reflects that the domestic economy is on the path of recovery.”

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    Corporate India has got the confidence to expand equity capital base and issue bonus shares owing to the fact that they have performed very well this fiscal.

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    Bonus issue is an offer of free additional shares to existing shareholders.

    This is one of the ways of rewarding shareholders, who largely benefit from capital gains.

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    A company may decide to distribute further shares as an alternative to increasing the dividend payout.

    It is also known as a “scrip issue” or “capitalization issue”.

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    The number of companies issuing bonus shares declined more than a quarter after hitting a peak in 2006-07 to 72 firms in 2007-08 and shrunk further to just 44 companies for the year ended March ‘09.

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    This came after three consecutive years of rise in number of bonus issues, when more listed firms announced a bonus bonanza in line with the bull run of the stock market.

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    Bonus shares are issued by companies through capitalization of their free reserves.

    When a company announces bonus issue, it is an indication of its management’s confidence to serve a larger equity base.

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    India Inc Set to Raise Rs.50k Crores Through IPOs in 2010: SMC Capital

    India Inc Set to Raise Rs.50k Crores Through IPOs in 2010:SMC Capital

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    Domestic companies seems set to get on with the huge fund raising exercise this year with plans to raise over Rs 50,000 crore via public offers, driven by the sharp recovery in the stock market.

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    Almost 50 companies have already filed the draft prospectus with the market regulator, the Securities and Exchange Board of India (SEBI).

    This depicts at the healthy prospect of the strong IPO market after the encouraging revival of IPO market in 2009.

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    Indian companies had raised about Rs 20,000 crore through IPOs in 2009.

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    Market Experts feel that fund raising can go up to Rs 50,000 crore this year since Government has already planned to sell shares in a host of public sector companies by way of IPOs and follow-on public offers (FPOs).

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    Five companies aiming to raise over Rs 300 crore have already received the regulator’s clearance for the IPO, if draft prospectus filed with the SEBI is anything to go by.

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    “The IPO pipeline looks strong in 2010.

    Also the way the government is pushing ahead with the disinvestment plan, fund raising can go up to Rs 50,000 crore by the end of the year,” SMC Capitals Equity Head Jagannadham Thunuguntla said.

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    As part of its disinvestment plans the government intends to raise over Rs 20,000 crore by way of FPOs of NMDC, SAIL, NTPC, and REC.

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    Some of the prominent private companies which have their IPOs lined up, beside this, include Jindal Power, BPTP, Reliance Infratel, Emaar MGF etc;

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    “Of the total IPOs that are in the pipeline, as many as 16 are from real estate sector. However, their success is a bit doubtful as the appetite for realty IPOs are currently less,” Thunuguntla added.

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    Primary market fund raising in 2008 saw 30 IPOs mopping up Rs 17,000 crore, but shares of many these companies gave the investors modest-to-good returns.

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    🙂

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    Note : For More Latest Industry, Stock Market and Economy News and Updates, please click here

    India Inc Set to Raise Rs.50k Crores Through IPOs in 2010

    India Inc Set to Raise Rs.50k Crores Through IPOs in 2010.

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    Domestic companies seems set to get on with the huge fund raising exercise this year with plans to raise over Rs 50,000 crore via public offers, driven by the sharp recovery in the stock market.

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    Almost 50 companies have already filed the draft prospectus with the market regulator, the Securities and Exchange Board of India (SEBI).

    This depicts at the healthy prospect of the strong IPO market after the encouraging revival of IPO market in 2009.

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    Indian companies had raised about Rs 20,000 crore through IPOs in 2009.

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    Market Experts feel that fund raising can go up to Rs 50,000 crore this year since Government has already planned to sell shares in a host of public sector companies by way of IPOs and follow-on public offers (FPOs).

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    Five companies aiming to raise over Rs 300 crore have already received the regulator’s clearance for the IPO, if draft prospectus filed with the SEBI is anything to go by.

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    “The IPO pipeline looks strong in 2010.

    Also the way the government is pushing ahead with the disinvestment plan, fund raising can go up to Rs 50,000 crore by the end of the year,” SMC Capitals Equity Head Jagannadham Thunuguntla said.

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    As part of its disinvestment plans the government intends to raise over Rs 20,000 crore by way of FPOs of NMDC, SAIL, NTPC, and REC.

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    Some of the prominent private companies which have their IPOs lined up, beside this, include Jindal Power, BPTP, Reliance Infratel, Emaar MGF etc;

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    “Of the total IPOs that are in the pipeline, as many as 16 are from real estate sector. However, their success is a bit doubtful as the appetite for realty IPOs are currently less,” Thunuguntla added.

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    Primary market fund raising in 2008 saw 30 IPOs mopping up Rs 17,000 crore, but shares of many these companies gave the investors modest-to-good returns.

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