21 January 2015

Modi Government & Indian Economy today & Tomorrow

Mr.Chandrashekhar Tilak is an economist & well known commentator on Budget analysis. He has been delivering budget speeches since 1988 and has completed a feat of over 1,000 lectures until date. He has been with NSDL, heading Indian Capital Market Division, for last 18 years. He was also member of the BSE Board for several Years. He has written books on the Indian Economy.

Principal M.D.Limaye Memorial Lecture by Mr. Chandrashekhar Tilak (Executive Vice-President at NSDL ) on 17th January 2015, in Tilak Mandir, Gokhale Hall.

According to Mr.ChandrashekharTilak, Modi Govt. means business, & actions. He does not mix economic interest of the nation with politics. He gave four following examples to confirm his statements.

Appointment of Union Minister of state for Home Affairs, Mr.Kiren Rijiju, an iconic political leader from Arunanchal. PM almost cajoled, persuaded him to take up the responsibility, as he was the only competent person to fill the post..

Kiren Rijiju was elected from Arunanchal Pradesh for the second time for the 16th Lok Sabha. He is considered the face of BJP & Voice of North East India. He made a statement  for construction of border roads along the border of China in Arunanchal & is considered as a one of the bold statement from any politician of India. Also for improving the communication in Arunanchal, he asked for 878 Telecom towers to be installed, which was sanctioned immediately, budget being monitored by the minister himself. Arunanchal is mineral rich belt, particularly for oil & gas, needs development for India’s future.

Second example he gave was Regular trains from Delhi to Katra for resettlement of Hindu refugees (Pandits) from J & K who are presently settled in camps out side New Delhi. This is a very important issue for not only Pandits but also strong entrenching of BJP in J &K at grass root level.

Third example was Horticulture centre for Assam and Bihar. 4th major component of India’s CAD is the import of fruits, flowers, Toys & Electronic goods from China & other countries. This can be curtailed by promoting Horticulture in North Eastern states, not only creating employment but also enhancing GDP of the region. Rs.136 cr were sanctioned & no political issues were raised by Modi govt.

Fourth example, is establishing Sports Academy in Manipur & sanctioning Rs.125 cr for the development sports & athletes for the forthcoming Olympics games. No. of medals won by sportspersons from Manipur, Meghalaya & Nagaland was 25% of All India tally of medals.
Mr.Tilak particularly mentioned about the Asian Games Gold medalist boxer Mary Kom who asked for award money to be given to Sports Academy rather than for herself.

Lastly, Modi Govt is shifting the focus to Younger generation while selecting the bureaucrats & ministers as well as members of NITI Aayog. Present Govt. which has started projects like “JanaDhan, Swatcha Bharat is convinced that it is the young generation who is prepared to change India, & should be motivated through participation in Govt sponsored schemes.

The talk by Mr.Chandrashekhar Tilak was appreciated by all & Mr. Mukund Chitale, President of the Lokmanya Seva Sangh in his concluding session, appealed to all to implement the good thoughts of the present Govt.   

- Vinod Borkar

17 January 2015

Investment culture for Quality Life

Mr.Deepak Ghaisas
VP, Lokamanya Seva Sangh
According to Mr.Deepak Ghaisas, any investment culture is not successful on standalone basis. It is based on the theory of reflexivity. Any good investment model cannot depend on single model of investment. Multiple models need to be kept ready because of changes that take place in the market.

Why we are investing & How much to Invest need to be understood by the investor.
All investments are basically to get Quality of life – ultimately the happiness but happiness is not defined. Making money is not bad objective, it is basically Upjivika – not main reason for Jivika - for living.

Investment in family is the time you spend with your family. It gives you happiness. Investing in health can give you happiness. Investing in community – concept of Microfinance, can give you happiness. Similarly Intellectual Property and spirituality that will do away the stress management will make you happy. To conclude, he said culture of quality life is not restricted to money you earn through investment of financial instrument but through above referred 5 mantras.

16 January 2015

Retail Investment – Global Perspective

Mr.Deepak Karanjikar mentioned at the outset that Economics is not a science but an art of demand and supply. India is the third largest retail market in the world It occupies 34.6% of GDP and has 8% employment. Food is the biggest component valuing at $ 470 Billion. Retail is a huge canvass and investment in retail will not be isolated from Global retail industry. Technology in retail is very vital to make it a sustainable business model.

Mr.Deepak Karanjikar, Consulting Engineer.

15 January 2015

Peaceful & Successful Planning of Investment

Chandrashekhar Vaze
Mr.Chandrashekhar Vaze, a versatile and multifaceted personality, explained social and Ideological aspects of succession planning. He advised that financial account should be transparent, with investment avenues simplified. A will is made to avoid disputes in future. A stamp paper & registration is not a requirement for a valid Will. Only it requires two bonafide witnesses & executors. He clarified that nomination does not replace succession, nominee is only a caretaker or a trustee. The subject was made very simple & easy with examples from Mr. Vaze’s vast experience in this field.

14 January 2015

Investor Protection

Ms. Nisha Subhash (Chartered Accountant, Sr. AVP, National Stock Exchange)  gave comparision of markets 25 years back & situation today. From regional & fragmented market to one market with access to investor across India. Settlement cycles were reduced. From physical trading to Online screen based trading. 

Guaranteed settlement due to precautions built into the system. E-mail/SMS to all investor for trade verification, Investor complaint redressal and Arbitration mechanism  

Ms. Nisha Subhash suggested Investing early, and only through authorized brokers. Analyse & Invest. Choose companies with strong fundamentals, & do not invest based on rumors. Review investment over a period of time and apply correction like getting rid of poorly performing asset.

Crude price slump a boon for India: RBI

Urjit Patel 
Deputy Governor, RBI
MUMBAI: The dramatic fall in global crude prices is a big boost for India as it can bring down the country's annual oil import bill by about $50 billion, according to RBI Deputy Governor Urjit Patel. 

"The dramatic fall in oil prices is a boon for us. It saves, on an annualised basis, around $50 billion, roughly, one-third of our annual gross oil imports of about $160 billion," RBI Deputy Governor Urjit Patel said. He was speaking at an awards function here last night. 

Read more at:

13 January 2015

Role of Mutual Funds in Investor’s portfolios

Ashu SuyashChief Executive Officer
L&T Investment Management Limited

Ashu Suyash (CEO L&T Investment Ltd.)  gave overview of Global & Indian Mutual Fund Industry & how Mutual Funds can add values to Investors. 

Equity Mutual funds constitute approximately 21% of world Equity market capitalization. Increase in share of equity assets is on account of appreciation in asset prices and improved investor sentiment.

In coming years, mutual funds are also expected to provide access to real estate asset class through REITs. M/s Ashu supported the concept of SIP for effective wealth generation & availing tax benefits.

Today L&T has AUM of Rs.20,673 crores, consistent growth in assets by 96% since Dec 2012.

12 January 2015

Emerging Investment Themes in Indian Equities

Mr. Swanand Kelkar
 Executive Director
 PMS, Morgan Stanley
Mr.Swanand Kelkar gave bird’s eye-view of Investment thinking of a multi-geography FIIs, including asset allocation, emerging sectors/ New themes and bottom up stocks.

According to Mr.Kelkar, at present India is more attractive destination for the foreign capital compared to Indonesia, SA, Brazil & Turkey.
There are 5 factors working for India.

1)   The stable political situation
2)   Rise in per capita income over last 5 years.
3)   Growth of Internet, Mobile Telephony, & TV channels
4)   Emergence of e-commerce
5) Planned Movement of goods in the country through dedicated corridors

Other factors favoring India as sought after destination is Inflation under control, Crude prices fallen sharply, thereby reducing CAD & stability to the currency.

According to him Return of capital is equally important as return on Capital.

11 January 2015

Portfolio Management

Mr.Ajay Walimbe
 Company Secretary
At the out set Mr.Ajay Walimbe informed that portfolio can be for real estate, Art effects, stocks, & Jewelery items.

Mr.Ajay Walimbe informed a empirical formula related to age of a person for the purpose of investing in stocks & other financial instruments. ( % of total investment in stocks should be equal to 100 minus the age of the person)

Mr.Ajay Walimbe warned that one must not invest in illiquid stocks, and at the same time do not develop love for the stocks one holds. He also gave a few tips for designing a portfolio. He suggested that one must specify the objective of ROI & then identify the stocks based on sector of Industry, revenue growth and Net profit for 3 years, PE ratio, EPS, BV, debt/equity etc.

Mr.Ajay Walimbe advised the investors to regularly monitor the portfolio & correct the course based on the developments.

IPO/FPO – Opportunity and Obstacles

Ms.Sangeeta Rathod, SEBI
Ms. Sangeeta Rathod informed how SEBI is a watchdog function when IPOs/FPOs are initiated by the organization. 

SEBI ensures that all relevant Information about the company is given in the prospectus & investors are not prevented from getting information about the liabilities & risks associated with new issues. Although the Merchant bankers are responsible for arriving at correct pricing, SEBI verifies the correctness of the price and discount to be given to the retail investors.

However, Ms.Rathod insisted that retail investors should be more aware proactive & careful at the investing stage and seek clarification required from SEBI.  

Investor Protection – Indian Security Market

Mr. Rajesh Doshi Compared the scenario in Indian Security market Pre NSE & post NSE. NSE established in 1994, started online trading platform with satellite communication technology, set up the first depository in the country, & played key role in introduction of derivatives market in India. 

Indian Capital markets were made world class in terms of transparency, efficiency and safety.

NSE focused on Investors & trained them through seminars, publications, Education through NCFM etc. Mr. Doshi also enumerated 7 mantras of Investing like Start early investing, diversification of Investment, analyzing & investing, monitoring regularly etc.

Mr. Rajesh Doshi emphasized that choose only SEBI registered brokers while investing to avoid frauds & cheating.

Mr. Rajesh Doshi concluded by saying one must also know the rights & responsibilities of investors & utilize the NSE and Investor service in the event of a dispute investor’s complaint.

10 January 2015

Equity Investment – Risky but Necessary

Mr.Sandip Sabharwal
Mr. Sandip Sabharwal talked about the risks in the market in the past and future areas of concerns, but feels that incrementally things are much better today than six months ago. Indian markets are now integrated with world & prone to global shocks.

He then talked about Wave Theory-Wave1 which was the bull market 2003-07 for a period of 58 months. Then we enter Wave-2 when bubble of real estate, stocks etc. burst, This phase was also of global nature which came to an end in March 2009.

Wave-3 saw strong market recovery in March 2009 as a result of stabilization measures of various central Banks. Wave-4 was The Indian markets moved up in tandem with most of global markets. The first leg of this big change for the economy was when Rajan took over as RBI Governor& the second leg with Formation of politically stable BJP Govt at the centre. In this wave-4 key contribution factors are Political stability, High savings rate, High capital inflows, a strong financial system, & huge investments in Infrastructure.

Mr.Sabharwal feels that wave-4  will be backed by low inflation, low interest rates, reduced crude & metal prices, & resultant reduced CAD to 1.5% should take the Sensex to a level of 75,000 by 2020.

Present & future of Life Insurance Industry in India.

Girish Kulkarni
Mr.Girish Kulkarni
 MD & CEO Star Union Dai-Ichi Life Insurance
Mr. Girish Kulkarni ( MD & CEO Star Union Dai-Ichi Life Insurance )  gave overview of Life Insurance Industry in India & how society looks at it & Insurance professionals. Protection of life is very vital which we in India do not give adequate importance.

Underlying principle, according to Mr. Kulkarni is “Insurance is not about what money can earn but what your money can achieve”

In India understanding of life insurance is poor and also its affordability is an issue.

70% opportunities for growth lies with rural population, which ends in the hands of unorganized sector, like money lenders.

With Govt’s policy of bank account for every one, followed by liberalization & opening of Insurance sector, India has a huge challenge for insurance in next 10 years. 

Conclusion of Inaugural session.

Mr. M.M.Chitale
President Lokmanya Seva Sangh
Taking the subject forward in the same spirit, Mr. M.M. Chitale (President Lokmanya Seva Sangh ) emphasized that apart from corporates, the need for good governance is required in social, cultural and even charitable organization. We need to give values not only for external features but also features internal to the organization, & that is how our direction will be towards Good National Governance. 

Corporate Governance & Value Creation

MD, L&T Finance Holding
During his inaugural address, Y. M. Deosthalee (MD, L&T Finance Holding) informed that Governance is much discussed & talked about in various forums, appreciated by investor community but still things go wrong in corporate sector year after year. He felt that investor community must understand the basics as they are the main stake holders of the company.

Although the issues have been adequately addressed in the legislature by company Law and watch-dog institutions like SEBI, at the end of the day it is the character of those who manage is important. Professionally managed company like L&T had the Corporate Governance in place even much before the legislature was in acted. The reason for the same is honesty & integrity of the management & accountability towards the stake holders. He emphasized that it the culture of the management team that delivers the Corporate governance & generally this is observed in the mindsets of the people who govern. Simply put, this character is required in their genes of the promoters in the corporate seat.
Governance is the internal system which should be transparent regarding directing the organization & should be portrayed as such for the outside world.

Value creation is for the stakeholders like Share holders, employees, vendors, service providers & in general for society at large. Long term value creation is quality of product and services and how problems are dealt with on long term basis.
YMD enumerated a few pertinent processes which govern & has potential for value creation. They are Quality & culture of the Board of directors, Long & short term strategy, Involvement of the board in Governance issues, Process of risk management in the company, Disclosures, Internal & external audit findings and the action taken reports, share holder’s roles and rights, & transparent Accountability of professionals for owning the process.

YMD concluded by saying that Mindset of ethical governance & commitment to social responsibility are basics for good governance if you require value creation for all stake holders over long life of the organization.