The Hindu Business Line : Sunday, November 10, 2002

Axing the tax incentive
THE recommendation regarding personal income-tax of the Task Force on Direct Taxes closely follows the recommendations of an earlier group headed by Mr Parthasarathy Shome. There is largely nothing new. However, compared to those of the Shome ... More

Kelkar's tax proposals — What's in it for shareholders?
IF you are a shareholder in any company that has paid taxes at more than 30 per cent of its book profits, there is much to cheer in the recommendations of the Kelkar Task Force on Direct Taxes. But if you are a shareholder in a company that falls ... More

The case against index funds
IS THIS the right time to invest in an index fund? This is a question many investors may be posing right now, with the S&P CNX Nifty, the widely-tracked market index, having shed close to 47 per cent of its value from the peak of February 2000. ... More

How they actually fared
UNTIL recently, not too many choices were available to those keen on investing in index funds in India. But several fund houses have launched passive index products over the past year, with five completing one year of operations. These are: ... More

Will SEBI bite, at least now?
THERE is now every reason for investors in the markets to hope that the Securities and Exchange Board of India (SEBI) will play a more effective role in safeguarding their interests. SEBI now has the powers of search and seizure that it has been ... More

INVESTMENTS

Do's and don'ts for investors
STOCK exchanges enable investors who hold securities to adjust their holdings in response to changes in their assessment of risk and return, and also to meet their liquidity needs. An investor buys and/or sells securities to rebalance his ... More

INDUSTRY ANALYSIS

Old private sector banks — Bent but not broken
THE acquisition of a strategic stake in Vysya Bank by ING and the failure of Nedungadi Bank (the RBI has imposed curbs on withdrawal of deposits by customers) have firmly turned the spotlight on old generation private sector banks in the country. ... More

Learning new survival ways
HERD instinct or Hobson's choice? Old private banks are following a strategy similar to that adopted by the entire banking industry. The strategy involves:

Investing in securities of top-rated companies;

Aggressively ... More

Thinning spreads, bulging NPAs
CAN old private banks grow? Or, have they been growing at all these past years? If the question is with reference to their size, then the answer is yes on both counts. Their deposit growth rate has been better than that of public sector banks in ... More

Bankable bets
MOST old private bank stocks look pretty attractive from a dividend yield perspective. However, the higher dividend yield is itself a sign of investor apathy for banking stocks, which is not without reason though. The large NPA overhang is ... More

FOREX

Now you can have forex accounts
YOU can now have a foreign currency denominated account with any bank. The Reserve Bank of India (RBI) has announced this major relaxation. But you can have only a current account that does not bear interest and has a cheque issuing facility. ... More

MUTUAL FUNDS

Sundaram Gilt Fund: Sell/Avoid fresh exposure
SUNDARAM Gilt Fund (Growth) returned 7.5 per cent since last November. The returns are not commensurate with the associated risks. Existing unit-holders can consider redeeming their units, while others can avoid taking fresh exposures.The ... More

Franklin India Bluechip Fund: Invest
FRESH investments can be considered in Franklin India Bluechip Fund. The prevailing valuations suggest that it may be the right time to enter into actively managed diversified equity funds. And Franklin India Bluechip is one of the better ... More

Kotak Mahindra K-30: Switch
K-30, the diversified equity fund from Kotak Mahindra Mutual Fund, has consistently held a significant portion of its net assets in cash over the past few months. This is in keeping with the alterations in the scheme's structure early this year, ... More

HDFC Growth: Hold/Avoid fresh exposures
INVESTORS in HDFC Growth Fund can stay invested as its performance is showing signs of picking up. The net asset value is, however, way below the face value of Rs 10 per unit and it may need at least a year or two of good performance and ... More

Variable Investment Scheme — New index-linked plan from UTI
THE Unit Trust of India (UTI) has launched an Index Linked Plan under its Variable Investment Scheme. The scheme will invest in debt and equity. The equity part of the portfolio will track the 30 stocks in the BSE Sensitive Index. The fund will ... More

Distorting cash component of IT funds
ALMOST all IT sector funds have trailed the BSE IT Sector Index in recent months. This is because of their cash component, says a Crisil study. A look at how these funds were invested at the end of September 2002 reveals that, on average, only 80 ... More

STOCKS

ONGC: Hold
OIL and Natural Gas Corporation's (ONGC) performance in the second quarter ended September 30 is first evidence of the positive impact of deregulation of the oil sector on the company. The upstream oil major has seen an impressive 36 per cent ... More

M&M: Hold
THE half-yearly performance of Mahindra and Mahindra (M&M)'s has improved sharply this fiscal on the heels of marginal improvement in operational efficiency and inflow of other income.Sure, higher volumes helped increase revenues. But the impact ... More

Madras Cements: Book profits and re-enter at lower levels
SHAREHOLDERS of Madras Cements can consider paring exposures now and contemplate re-entring at lower levels. The company has reported one more quarter of disappointing earnings and growth. The pressures on cement prices and sluggish volumes have ... More

Berger Paints: Buy
INVESTORS with a medium-to-long term perspective can consider taking exposures in Berger Paints, which now trades at Rs 76. The company has decided to acquire the entire exterior paints business of Snowcem India — a strong player in ... More

Apollo Tyres: Hold/Buy on declines
AIDED by the recovery in automobile industry, the increased activity in the housing sector and recovery in industrial production, tyre companies reported improved performance over the last few quarters. Apollo Tyres too recorded a sharp growth in ... More

ACC: Possibility of open offer
EXISTING shareholders of ACC can stay invested as there are interesting possibilities with regard to a possible open offer. Investors with high-risk preference can contemplate small exposures to take advantage of any favourable outcome on the ... More

TRAVEL & PLACES

Airfares to move skywards

REAL ESTATE & CONSTRUCTION

NRI property sale made easier
For non-resident Indians and persons of Indian origin, selling real estate in India and repatriating the proceeds abroad is now easier. The Reserve Bank of India (RBI) has removed the lock-in period that was in place for this purpose. The sale ... More

Housing scheme for PF subscribers
The Centre is to launch a housing scheme for members of the Employees Provident Fund. To be launched on December 25 in Delhi, it will be taken to the 216 other centres depending upon the participation of the States. The funds would be made ... More

ECONOMICS

Signalling Theory and market efficiency
LAST week, we discussed bounded rationality, which exists because we have limited information and time for decision-making. But what happens if more information is available? Dr Michael Spence, a Nobel Prize - winning economist, conducted ... More

SMALL SAVINGS

EPF rates to stay
For investors who are witnessing declining interest rates across most investment options, their provident fund investments may earn 9.5 per cent in 2002-03 as they did in 2001-02. Despite the Finance Ministry's preference to cut this to 9 per ... More

STOCK MARKETS

Bourses witness lacklustre bout
TRADING was listless last week on account of Deepavali-related holidays. Equities gently drifted down towards the end of the week in the absence of a positive trigger. On Friday, the BSE Sensitive Index closed at 2,956.84 points, a shade higher ... More

Book profit in Infosys
Nifty (956.95): The overall outlook for the Nifty continues to remain weak. The immediate resistance lies at around 971 As of now, taking short positions in the index would be preferred course of action. A move past 971 would warrant ... More

Pare exposure in ICICI Bank
AFTER a firm trend on the Diwali day, the stock market sentiment remained subdued on the remaining three days of the week. The relatively subdued trend in Reliance coupled with concerns relating to delay in PSU disinvestment affected market ... More

Nasdaq: Bleak outlook
AFTER a firm start, the American stock market sentiment weakened as the week progressed. The half a percentage point cut in interest rate effected by the Federal Reserve imparted positive sentiment at the American bourses. However, the earnings ... More

Syngenta gains 37 pc
Bata India (Rs 32): The drop in the stock prices of footwear major Bata India, by 3.2 per cent this week has to be viewed in the context of September quarter performance. For the quarter ending September 2002, the company announced ... More

DEBT MARKET

Bonds likely to trade in tight range
WEEK ending November 8 saw the yield curve become more concave. The benchmark 10-year yield currently stands at 6.83 per cent, after touching an all-time low of 6.81 per cent. Going forward, bonds are likely to trade in a range. Consider the ... More

DERIVATIVES MARKETS

Trading in index futures
Futures and options are forms of exchange-regulated forward trading in which you enter into a transaction today, the settlement of which is scheduled to take place at a future date. The settlement date is called the expiry date of the ... More

Options guide

Futures guide

FIXED DEPOSITS

Sundaram Home Finance: Home safe
THE fixed deposit programme of Sundaram Home Finance, a subsidiary of Sundaram Finance, could be a good option for investors with a low-to-medium risk profile. The interest rates are quite attractive, especially after the recent decline in ... More

INTERVIEW

`Paints are acquiring FMCG overtones' — Mr H. M. Bharuka, MD, Goodlass Nerolac
Continuing his conversation with Business Line, Mr H. M. Bharuka, Managing Director of Goodlass Nerolac Paints, talks about the impact of paint imports, his companies growth plans and the regulatory changes that ... More

INCOME TAX

Kelkar tax proposals — Set to hit salaried class hard
LOOKING at the proposals on direct taxes made by the taskforce headed by Dr Vijay Kelkar as a whole, it is clear that, if implemented, they will hit the middle class and senior citizens hard. One look at the accompanying table may be enough to ... More

CARTOON

It Adds Up!

Comments & Letters to the Editor to: bleditor@thehindu.co.in
Subscribe to: Business Line

Pick a Winner Stock Market Contest

Axing the tax incentive

The case against index funds

Old private sector banks — Bent but not broken

Do's and don'ts for investors

Kelkar tax proposals — Set to hit salaried class hard

In Depth
Gender Justice

Simple Economics

Small Investor

Looking back
Nov. 3-Nov. 9
Paints: Shades of pink

Reliance gas and Indian energy

Market-linked insurance plans: Premium option

Credit Policy: Nothing to cheer savers

July-September quarter: A case of diverging lines

Dividend income/PF/Set-off: Treated as `business income'