Friends,
The first seven months (april-oct) have yielded 22% less indirect taxes for the govt this year. The fall in custom,excise and service tax collection is only natural as there was reduction in these taxes under the stimulus package and is natural to be expected. It should,however, have no bearing on markets.
Shree Renuka Sugars has acquired a Brazilian firm for Rs 1112 crs and would pay Rs 380 now and rest over next eight years. I think this is a negative for Renuka and one may sell it now. Renuka operates eight sugar mills, of which three are on lease. The whole business of Renuka now seems to deliver only meagre returns in future without any discernible extra profit making capability.
Sales of cars jumped 34% in Oct 09 while two wheelers sold 14% more only. This conveys that the middle classes have been doing better economically than earlier and there is cross over to middle class by the lower income group in large numbers. This should be a good indicator that the FMCG would be doing better as also the pharma. These two sectors are entirely dependent on middle classes. George Bush recently recounted that Indian Middle Class of over 300 million is larger than the whole population of USA.
Rcom would spend Rs 200 crs to enable the low end mobile users send and receive emails on low cost sets for a fee. It has 190000 km of optic fibre network. The PCR (put call ratio) is at high point of over 1.6 and is cause of worry in the sense that while there may be quick up move in market it will also be prone to sudden correction.
Hari Om,
Krsna Khandelwal
BIRDINFO Stock Rx - A prescription for stock market
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