Investment Prime time!
Yesterday I said “market will boom”. Today I am telling you some of the things that I like about what the government has got right. NO. It is not something which you do not know, but just enumerating them.
- It is not a Nbfc crisis. It is a Housing finance crisis and I have no clue what NHB is doing, and why is it not being asked the difficult times.
- RBI needs to wake up and LEARN to regulate. Oops. Sorry.
- The government could have taken 2 routes – put more money into the hands of the people (consumption story) or put more money into the hands of the corporate (investment story). They have chosen the more difficult path – the investment story – and that is good for the country.
- Many people are still bearish, but I can see the green shoots. Many individuals are willing to invest – albeit through a sip.
- It is stupid to break the investments into market capitalization basis. Just a couple of broad funds is good enough.
- Look at the new fund houses. The old fund houses are resting on their butts and showing us the last 23 year returns…time for a rejig. Old has to make way for the new.
- Capex story will unfold – please don’t ask me when.
- The amount of infra spending – UP will go from 2 airports to 11 airports. Are our airlines ready for this kind of demand explosion.
- Airlines, Hotels, Senior citizen care, etc. will drive job creation in a big way
- Many of the smaller states will grow at much faster rates than the national average
- The most backward 150 districts have been identified…and are being encouraged to grow.
- The sensex will see 75000 by 2024..I am sticking my neck out.
- Governmental expenditure will have an impact on the economy – soon
- Forget what the auto industry is telling you. See the numbe of mobiles that Flipkart and Amazon are selling.
- youngsters are spending on things that their parents didn’t spend on.
- Govt of India’s figures are thrash – India is in its unorganised sector.
- Listed car manufacturers have become irrelevant – and fast…
Arun Rao
Specific to the automobile sector, I think that most of our auto companies have been in the ‘cash cow’ quadrant of the BCG matrix for a really long time. There has been absolutely no breakthrough innovation for nearly 20 years now.
In the meanwhile, consumers have moved on. As you pointed out in your article, youngsters are buying stuff that their parents aren’t. One thing they are not buying is automobiles thanks to the emphasis on gathering ‘experiences’ rather than gathering ‘things’. Another game changer is technology enabled asset sharing.
Unless automobile companies introduce products in the ‘?’ and ‘star’ quadrants of the BCG matrix they are definitely doomed.
Santhosh
3.Indian corporates are and will remain greedy. Attrocious pricing of cars, flats, goods etc. Book an indigo flight 2 months in advance for a vacation and get last row seats. Thanks to new entrants we get high end specced mobiles for 15k, better cars with safety and technology.
the government should have increased the 80 limit or decreased individual taxes.
SS
Hi Subra sir, This is a good article with reasonable certainty on the likelihood of events.. Yesterday’s article had I don’t know at the end. Public have to know something about future – may be with 70-80% of confidence – based on which they make investments for future. I m not sure, how a 1 or 0 – I know / I don’t know can be helpful. There has to be some shades between – Like 4,7,12,13 show possibilities in this article. Thanks for this..
@Arun, Thanks for your points as well.. Innovations are there, but in Indian context they cannot be applied – driverless cars, electric vehicles, auto part sensors, trackers etc. Other thing to note is Ambassador and Fiat are depreciating assets. But today, there is customer for 10 or 15 year Alto.. The shops for second hand vehicles like Cars24, TrueValue etc are booming.. There are takers. Some ads are showing 60-70% resale values on their auto.. It means quality improvement, and now Indian market is not always buying/paying premium of ‘new’ vehicles and assuming it as depreciating assets..
pradeep
Lots of stick on RBI for not doing enough regulating. Latest PMC, Yes bank and PNB frauds/misreporting episodes shows that unless the bankers are honest along with the auditors, RBI has no chance regulating these banks. One way to make them fall in line is by imposing huge fines when caught like US regulator. But this will be challenged in our brilliant courts which will stay these decisions for years and produce a verdict 15 years later. Also the bankers doing this fraud don’t get punished, they are suspended and no one hears about them after. Even Kotak bank doesn’t want to follow RBI rules. RBI with its limited resources cant do much and all bankers know that. There is no fear of punishment in India. Politicians and bankers are simply taking advantage of this.
Aliyan
Earlier corruption was limited to govt offices where in you visit for certain service. Slowly it got extended to other Govt entities like Govt hospitals, schools, PSU banks, Courts and Police stations and what not seo
rkhgajjar
Being a Medical Professional,I understand that our Banking Systems or for that matter Economic systems were suffering from some un identified or neglected disease by previous regimes,now the disease is identified or diagnosed,is being treated,right way or wrong way,time well decide,but as in any disease recovery there remains hopes & doubts,similar is our phase these days.
At least there is a diagnosis, disease will not spread ,is a cause of Hope for us!!!!