For those who were born in the 1980s…and who take 8-9% growth for granted they should take a lesson in History! Just when I saw the rocking performance of Bajaj Auto – 80% y-o-y growth – and a net profit for the year Rs. 1700 crores! When Rajiv Gandhi came to power he allowed motorcycle manufacturers to set up plants with a capacity of 100,000 vehicles. Sure he got critics saying this is too much, but then Mr. Vasant Sathe had also got brickbats for bringing ‘Colour Tv’ to India!

Now 3 manufacturers sell more than 100,000 vehicles (2-wheelers) a MONTH.

If you see these numbers and are willing to extrapolate, it does not matter whether you have Bajaj Auto (Rs.2200 is a distinct possibility?), Hero Honda, Gillette, Colgate, ITC, Tata Motors, Coromandel Fertilisers, Tata Chemicals, Mahindra Holiday Resorts (to me it looks attractive only at Rs. 450) ….it will not matter. India Rocks, do not sit on the sides..and say “I wish I had invested…in 2020….or when the index is at 48,000 – whichever!!)

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  1. Got this as an email…from a reader:

    Gold prices are erratic. True. Between 1980 and 2006 price might be $700. It is a new revelation. But in terms of Rupee it was perhaps very high since rupee heavily depreciated against Dollar during that period.

    Earlier Gold price was ruled by demand/supply and in India it was always in demand. Only in last few years price is dominated by world economic crisis and erratic behaviour of currency market.

    Western economies will continue to be on turmoil since Social Security is costing them a lot and their revenues are stagnating. However I do not know how many countries have Gold as reserve currency. When smaller counries (Rich Countries) start losing confidence in Dollar or sterling they may switch to gold. (This is old school of thought and I do not know whether these thoughts have changed). If old thought is still valid, I think Gold prices will move up — not gradually but in steps. Whether it will move faster than Shares I cannot say. I have lost my ability to judge share prices. There are too many variables and my brain functioning is now limited. Logic appears to be a very small variable – Others like Technical and Global Idiocracy seems to decide share prices!!

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