Tuesday, May 31, 2011
Bull of the Day: Largecap stock that rose 56% in 12-months
Q4FY11 triumph:
Tata Consultancy Services (TCS) reported its fourth quarter net profit at Rs 2402 crore, a growth of 3% from its previous quarter net profit of Rs 2,330.2 crore (US GAAP). The company met street expectations.(Click here for full details)
A CNBC-TV18 poll saw a profit growth at Rs 2,340 crore. For the financial year 2010-11, TCS reported net profit of Rs 9,068 crore versus expectations of Rs 8,621 crore.
The company attributed its performance in the January-March period, which was in line with street expectations, to excellent execution and constant customer focus.
During the period, its revenue jumped by 5.1% to Rs 10,157 crore as against Rs 9,663.4 crore in previous quarter.
New order update:
IT firm today said it has bagged a contract from Ahli Bank to provide software solutions for the bank's brokerage operations in Qatar. However, the company did not disclose the financial details of the deal.
How far is it from 52-week high?
The company touched its 52-week high Rs 1,247.00 and 52-week low Rs 748.00 on 06 Apr, 2011 and 01 Jul, 2010, respectively. Currently, it is trading -7.07% below its 52-week high and 54.92% above its 52-week low. Its market capitalisation stands at Rs 226,802.77 crore.
More on the stock
Today it closed at Rs 1,158.80, up Rs 5.55, or 0.48%. It touched an intraday high of Rs 1,175.50 and an intraday low of Rs 1,152.50. There were pending sell orders of 16 shares, with no buyers available. The total traded volumes were of 78,033 shares.
The company's trailing 12-month (TTM) EPS was at Rs 38.68 per share. The stock's price-to-earnings (P/E) ratio was 29.96. The latest book value of the company is Rs 115.40 per share. At current value, the price-to-book value of the company was 10.04. The dividend yield of the company was 1.73%.
Peer comparison:
Company
Last Price (Rs)
Market Cap (Rs in Cr)
Sales Turnover (Rs in Cr)
PAT (Rs in Cr)
TCS
1157.15
226479.83
29275.41
7569.99
Infosys
2785.65
159938.53
25385
6443
Wipro
446.4
109524.24
26340.7
4843.7
HCL Tech
514.8
35390.57
5078.76
1056.58
Oracle Financ
2222.95
18651.03
2360.51
967.98
Mahindra Satyam
85
10001.18
5100.5
-71.2
Mphasis
468.3
9833.77
3770.09
996.88
Tech Mahindra
677.8
8521.3
4965.49
696.72
Patni Computer
352.7
4712.34
2030.61
655.05
Financial Tech
831.65
3832.12
356.36
368.6
Source: http://www.moneycontrol.com/news/market-edge/bullthe-day-largecap-stock-that-rose-5612-months_548447.html
Thanks and Regards,
Sanchari Sinha,
Intern at DENIP Consultants Pvt. Ltd.
Why Fixed Deposits are not good for your child
In many households across India, when a child is born, the first financial investment in his name is a PPF account. Such is the draw of the assured 8% tax-free income that parents overlook everything else-the impact of inflation, their own asset allocation, even the rules that govern the government-managed saving scheme.
According to rules, an individual cannot deposit more than Rs 70,000 a year in his PPF account. This limit does not increase if he opens another account for his minor child. The contribution in the child's account is clubbed with the parent's limit of Rs 70,000 per year. So, if you invest Rs 10,000 in your child's account this year, you can invest only Rs 60,000 in your own. "If the maximum limit remains the same, you are cutting back on your own retirement planning by investing in the child's name.
It's no different when it comes to fixed deposits. The interest earned on fixed deposits is fully taxable. "If you invest in a child's name, the income earned is clubbed with that of the parent who earns more and is taxed at the applicable rate," says Hiten Shah, senior manager with Deloitte Haskins & Sells. This makes fixed deposits one of the most tax-inefficient investments for your child. If the deposit rate is 9% and the parent falls in the 10% tax bracket, the effective post-tax rate will be 8.1%. In the highest 30% bracket, it will be 6.3%. "The post-tax return from a fixed deposit will not be able to beat inflation," says Lovaii Navlakhi, chief financial planner, International Money Matters.
This is true. A high inflation rate of 8-9% means you are not making money on your fixed deposits but your wealth is losing its value over time. "Parents do not factor in the effect of inflation on their corpus when they save for their children's needs.
This is why it is important to have a share of equities in your portfolio. Monthly income plans from mutual funds are hybrid schemes that invest in a conservative blend of stocks and bonds. Almost 80% of the money is in safety of debt and only a small 20% goes into equities. In the long term, this small portion of equities has proven very rewarding for MIPs. The best performing schemes have given returns that are far higher than those of the PPF and fixed deposits (see table). What's more, there is no limit on how much you can invest in your child's name in an MIP and there is no tax implication till you withdraw the investment. These MIPs can (and should) replace the fixed deposits in your portfolio.
Having said that, let us also make it clear that fixed deposits have their own place in the portfolio. There is a small window of opportunity to earn tax-free returns by investing in the name of your children. The Rs 1,500 a year exemption for a child's income means you can invest up to Rs 15,000 in a bank fixed deposit and earn tax-free income. This can be availed of for a maximum of two children in a family. The high interest rates offered on long-term bank deposits right now (see table) are very rare. If you have two children, it's a golden opportunity to lock in up to Rs 30,000 for 8-10 years at these high rates.
As we have mentioned earlier, the suitability of the instrument depends on the time available for the goal. Fixed deposits can be useful in the short term. "When your goals are very near, say 1-2 years away, you should start shifting your investments to fixed deposits.
Source: www.economictimes.com
Ravi Jhawar
Summer Intern-Technical Analyst
DENIP Consultants Pvt. Ltd.
Defensive stoks are safe bets in volatile markets
This doesn't mean that you should press the panic button. There are some themes that will shine amid this downslide. These are the defensive stocks, which outperform the markets during a bearish phase and are safe bets in a volatile climate. Here's how you can provide a cushion to protect your portfolio by allocating some money to these stocks.
Defensive bets in a downturn
FMCG: These companies produce the most common necessities, which are picked off the shelves at all times. Their purchase pattern is not affected by monetary constraints. Soaps, detergents, cooking oil, toothpaste and, to an extent, food products and beverages, are in constant demand. ITC and Godrej Consumer Products are the top analyst picks.
Healthcare/Pharma: Companies manufacturing pharmaceuticals or medical equipment, or even those providing medical services, such as test laboratories, can boast stable revenues in a harsh economic climate. The demand for medication remains immune to such conditions. Lupin, Glenmark Pharma and Aurobindo Pharma are the favoured stocks among analysts.
Utilities: Basic services, such as electricity, gas, water and sanitation, are used by consumers through economic ups and downs. The companies that provide these to people are among the steadiest performers. Power Grid Corporation , CESC and PTC India are among the top picks in this segment.
When the economy turns sour, small- and mid-cap stocks are hit the most severely as investors don't have confidence in their ability to sustain the turmoil. Most investors flock to the relative safety of large-caps and blue chips to help them tide over the downslide. The strength of the balance sheet, management quality, high market share and earnings visibility lead investors to believe that the company will weather the storm. While this is usually the case, not all blue chips make for safe investments.
First, these are not cheaply available as they usually trade at expensive valuations. Not all blue chips are worth buying at such levels even for the long term. Second, some of these may already have reached a point after which further growth comes at a very slow pace. A good example is Hindustan Unilever. As such, the upside for many of these stocks is very limited.
However, holding some select blue chips in the portfolio can provide the much needed stability to your returns. For novice and conservative investors, buying blue chips is a prudent decision. The ideal candidates are the ones that are not sensitive to economic cycles, have the ability to generate free cash flows and, therefore, dividends.
So be choosy even while picking from the top layer in the stock market. Finally, as safety is of utmost importance at such times, try to remain diversified across sectors in order to reduce your risk. As Parmar advises, "In these circumstances, investors may focus on certain blue-chip companies which remain cash flow positive and have little or no leverage on their books.
Source: www.economictimes.com
Ravi Jhawar
Summer Intern-Technical Analyst
DENIP Consultants Pvt. Ltd.
IFCI Ltd. - Unsecured Bonds at 10.5% for 10 years and 10.75% for 15 Years
There is still good money to be made in emerging markets: Emil Wolter, RBS
ET Now: What do you make of the recent underperformance, which emerging markets have reported and you think the underperformance is here to stay?
Emil Wolter: To be honest, it would depend on the market going forward. There are perhaps certain factors that one could point towards representing some more sustained risk of underperformance but actually my feeling is that the outlook for Asia ex-Japan in general is reasonably constructive for the next 12 months.
ET Now: In particular what about India because the markets have headed for a big correction in the last two months? Do you think there is further downside? What are the fundamentals indicating for India in particular?
Emil Wolter: We have been cautious on India for quite some time as you are possibly aware. I still fail to get very excited about the prospect for the markets.
We are continuously looking at a trajectory of slower growth. This trajectory basically has not yet been reflected in either analyst expectations or indeed valuations for the market overall.
Whether or not, we will see a dramatic decline from here; I probably would not bet aggressively on that but sustained underperformance might well be on the cards due to a combination of effectively pressure on the external accounts, a sustained high inflation and therefore a need for higher interest rates and ultimately the result, which would be a slower growth in the economy.
ET Now: What are the chances that towards the second half, Indian markets could bounce back as the inflation/commodity effect could actually support a market like India?
Emil Wolter: Those chances are always there and indeed my preferred outcome is that the valuations compressed by another 20-25% might not take place.
Indeed one of the upside surprises if you like or one of the potential positive tailwind that India could enjoy would be a dramatic decline in the oil price for example, that would also be good news for the global economy in aggregate.
I suspect that might not happen, so yes if commodity prices were to come off dramatically, if somehow commodities and the supply of basic foodstuff would go from being in a tight supply and demand balance to being in abundant supply, all of that stuff could potentially happen and, therefore, could prove a boon to the Indian market.
In the meantime, it looks like the economy is set to continuously slowdown. We are still not seeing a great many deal of the earning surprises on the corporate side and valuations do not look that attractive.
ET Now: There have been fresh round of cuts when it comes to India's estimated GDP figure for this fiscal and the next, what is your prognosis and target for GDP growth at RBS?
Emil Wolter: I am not an economist, so I can tell you the official RBS estimates for 2011 and 2012 around 7.8%. I suspect that this puts us pretty much in the middle of the pack with the rest of the street. Our personal view is that we could slow quite a bit more. India is going into a period of time where it will probably grow somewhere between 6.5-7.5% and that's not the end of the world by any stretch of the imagination but it obviously is still somewhere below what is I guess effectively expressed in the current earnings estimates for the stock market.
Government Proposes Stringent Norms for Preferential Allotment
The government has proposed tighter rules for preferential allotment of shares and other financial instruments that can be converted into equity at a later date. The new rules require the issuer to seek government permission if the cumulative value of the allotment is over 5 crore. The ministry of corporate affairs has put up its draft ' Unlisted Public Companies (Preferential Allotment) Rules, 2011' for comment on Monday. Through these rules the government hopes to check flow of black money and money laundering. The new rules have proposed that the securities should be issued in Demat mode and imposed more disclosures on both the company and the buyer. The last date for submitting comments is June 20. The new rules will replace the Unlisted Public Companies (Preferential Allotment) Rules, 2003. The guidelines will apply to preferential issue of equity shares, fully convertible debentures, partly convertible debentures, or any other financial instrument that can be converted into equity shares. Tracking flow of transactions will become easier if securities are issued in a dematerialized form. There are about 40,000 active unlisted companies in the country. A company will be allowed to issue securities on a preferential basis only if it allowed under Articles of Association and backed by a special resolution passed by the members in a general meeting. In case of warrants the conversion price is to be fixed at the time of allotment. The issuer has to file a return of allotment with the registrar of companies within 30 days of allotment. Apart from the routine information about the issue and its purpose, the issuer will have to disclose details of loss making group companies, outstanding loans and advances , unsecured debt investments or those carrying lower than market rate, negative cash flow (if any), and contested tax demand.
Source: www.the economic times.com
Vivek Agrawal
Summer Intern-Fundamental Analysis
DENIP Consultants Private Limited.
Vedanta Cairn Romance
Its seems there is love triangle between Cairn Vedanta and ONGC. The latest news is that Vedanta Resources may go ahead with the acquisition Cairn India of the government's insistence on tough conditions on royalty.
Vedanta is very keen to enter into Indian energy market as it is developing economy and there is lot of scope for expansion .When Vedanta Resources had first evinced a desire to buy Cairn India, crude oil prices were $75-80, now they are around $112-115. Market experts are also of the view that Vedanta has little choice left but to go ahead and complete the acquisition as it has already acquired Petronas' stake in Cairn India and committed to raise debt to finance the deal.
Vedanta has already acquired 8.1% stake through a mandatory open offer to Cairn India's minority shareholders for another $1.2 billion, so clearly the company has a lot at stake.
Its been over a year that the romance is going on between these 3 companies. The problems are related to royalty and cess.The primary bone of contention being the country's largest onshore oil producing fields in Barmer, Rajasthan, where Cairn holds a 70% stake while ONGC hold the balance 30%. so now we have to see when the deal will strike and on what conditions.
Stevenson
Management trainee- Fundamental Analyst
Denip Consultants Pvt.Ltd
Banking MFs fall on lending fears
MFs that focus on the banking space sector, one of the consistently best performers in the recent past, have come up with a poor show landing at the bottom of the performance chart in the one- and six-month time frames. They are one of the worst performers in the three-month period as well.
Banking MFs have lost 12.8% in the past one month (till May 24), recording a much steeper decline than even the small-cap index, which has been adversely affected in the recent market downturn. While the broader markets have dropped 14%-15 % from the high October 2010 levels hit in October last year, the banking index lost about 23%.
The tight monetary policy adopted by the RBI has emerged as a key risk for the banking sector as it could slow down industrial activity and impact loan growths in the current fiscal, analysts said. "Short-term rates went up in January-March due to the liquidity squeeze and as a result, cost of funds also increased," said Mahesh Patil, head, domestic equities, Birla Sun Life MF . "The aggressive (RBI) rate hikes, forecasts of a lower economic growth and concerns over the quality of assets (in banks' books) also played a role," he said.
The cost of deposits has started to increase with a lag for banks after the recent rate hikes by the RBI. Every 50 basis points (bps) or 0.5% increase in savings bank (SB) rates negatively impacts profit margins by 8 bps.
The interest expense growth was higher than deposit growth for the country's top lender State Bank of India(SBI) after six quarters in January-March 2011, analysts at Motilal Oswal said. While interest expenses grew 22% in the quarter, deposits increased 16%. The annual slippage or gross non-performing assets remain high for many leading banks including SBI , observers said. Stocks of most leading banks have fallen at a faster pace than the Sensex in the last six months.
Incidentally, some banking scrips, especially in the public sector space, have lost more than even the BSE Bankex. Observers said public-sector banks get impacted as they have a higher exposure to SB accounts compared to larger private banks. Though banking-focussed funds would underperform in the current quarter, they would do well in the medium and long-term , Birla's Patil said. Despite the poor show in the short run, banking sector MFs are among the top-5 best performers in the equity MF category in one, two and three-year time frames.
They remained in the top slot generating 22.7% returns , 7% more than the next best performer, for the fiveyear period.
Monday, May 30, 2011
Net FII Purchases & Sales During the Week 23rd May to 27th May, 2011
FII purchases during the week:
25/05/2011: 35.1
27/05/2011: 1222.6
FII Sales during the week:
23/05/2011: -75.1
24/05/2011: -138.1
26/05/2011: -418.5
FII were net buyer of Rs 626 crore during the week.
Thanks,
Gaurav Agarwal
Head Dealer
DENIP Consultants Pvt Ltd
Sectoral Performance During Week 23rd May to 27th May, 2011
MAJOR SECTORAL GAINERS:
OIL & GAS: 2.40%
CONSUMER DURABLE: 1%
BANKING: 0.50%
FMCG: 0.40%
METAL: 0.30%
MAJOR SECTORAL LOSERS:
AUTO: -1.40%
CAPITAL GOODS: -1.80%
IT: -1.90%
POWER: -2.20%
MAJOR GAINERS IN BSE-A GROUP:
MPHASIS: 13.40%
EDUCOMP: 11.30%
FEDERAL BANK: 9.10%
MAJOR LOSERS INBSE-A GROUP:
TATA GLOBAL: -8.60%
BALRAMPUR CHINI: -6.70%
REI AGRO: -6.70%
Thanks,
Gaurav Agarwal
Head Dealer
DENIP Consultants Pvt Ltd
DENIP Students give feedback on NCFM Training
Ms. Charmi said that she enjoyed the training a lot. She had zero knowledge regarding the markets and now she has quite good knowledge about both capital and derivative markets.
According to Ms. Amrita and Mr. Mohammad DENIP provides "excellent" training, Mr. Dewang Mehta is a great trainer and the training program was perfect.
They look forward to attending the Technical analysis course starting tomorrow, i.e. Tuesday, May 31, 2011.
Thanks and Regards,
Sanchari Sinha,
Intern at DENIP Consultants Pvt. Ltd.
Trend in Global Market during the Week 23rd May to 27th May, 2011
DOW JONES: -0.60%
FTSE 100: -0.20%
DAX: -1.40%
CAC 40: -1%
BOVESPA: 2.70%
HANG SENG: -0.40%
SINGAPORE: -1%
SHANGHAI: -5.20%
SENSEX: -0.30%
Thanks,
Gaurav Agarwal
Head Dealer
DENIP Consultants Pvt Ltd
DENIP INVESTMENT ACADEMY gives 1 Lakh Scholarship to K.J. Somaiya Students
These students were provided training for the various Investment Instruments in the Market, Fundamentals of the Stock Market and Advance course on stock market; & they were enthralled by the kind of training DENIP provided.
Ms. Yogita said " The training was fabulous. I wish it would have extended a bit more"
Ms. Krishna and Ms. Komal said that they gained complete knowledge about the markets from the training, there were no loopholes that they could think of and the trainer was simply superb.
All of them have wished DENIP good luck in all its future endeavors.
Thanks and Regards,
Sanchari Sinha,
Intern at DENIP Consultants Pvt. Ltd.
Important US Economic Data Releases for the Week 30th May to 3rd June, 2011
Tuesday
Chicago PMI
Consumer Confidence
State Street Investor Confidence Index
Farm Prices
Wednesday
Bank Reserve Settlement
Motor Vehicle Sales
ISM Manufacturing Index
Construction Spending
Thursday
Chain Store Sales
Monster Employment Index
Jobless Claims
Productivity and Costs
Factory Orders
Fed Balance Sheet
Money Supply
Friday
Employment Situation
ISM Non Manufacturing Index
Source: www.sharetipsinfo.com
Thanks,
Gaurav Agarwal
Head Dealer
DENIP Consultants Pvt Ltd
The Trout and Ries way...
As a start up, positioning is vital for survival. If the company cannot carve a niche for itself in the mind of its prospective customers, how can it survive and do business? The work had already been started by the founders of the company and now its up to the interns to take it further! And taking it further they are by coming up with new and innovative ideas on a regular basis. However, coming up with an idea is only half the battle won. These interns are going all the way by implementing their ideas... ideas like Social Media Marketing, Online Integration, ideas on targeting! These may not be path-breaking new concepts but every idea counts and contributes to the growth and development of brand DENIP, in the minds of prospective customers!
Oil drops as US Economy Weakens
Muthoot Fincorp Ltd. - Secured NCD @ 11.75%pa for 2 year tenure
Issuer | Muthoot Fincorp Ltd |
Issue Size | Up to Rs. 25crores with a greenshoe option of RS. 10 crore |
Instrument | Secutred Non Convertible Redeemable Debentures ('NCD' / 'Debentures') |
Issuance Form | In Dematerialized Form |
Credit Rating | A+' by Crisil Ltd |
Security | First pari passu charge on receivables of the company with a minimum asset cover ratio of 1.10times to be maintained during the entire tenure of the NCD |
Face Value / Issue Price per NCD | Debentures shall have face balue of Rs. 10,000/- each |
Minimum Application | Initial 10 debenture of face value Rs. 10,000 each and multiple of 1 debenture thereafter |
Tenure | 2 Years |
Put & Call Option | Nil |
Redemption / Maturity Date | 2 years from the date of allotment |
Coupon Rate | 11.75%pa |
Interest Payment | Annual, subject to deduction of tax at source |
Trustee | IL & FS Trust Company Ltd. |
Depository | NSDL / CDSL |
Interest on application money | At the respective coupon rate on each "Debenture" (subject to deduction of tax at source, as applicable) from the date of realization of cheque(s) / demand draft(s) up to one day prior to the deemed date of allotment. |
Issue Schedule | Issue opens on: 30th May, 2011 Issue Closees on 29th June, 2011 Thee issuer would have the right to pre close the issue or extend the closing date by giving 1 day notice to the arranger |
Deemed date of Allotment | 10 working days from the Issue closure date |
DENIP Consultants Private Limited
Apparel exports grow about 13% in April
The exports stood at USD 972 million in April last year, according to the data provided by the Apparel Export Promotion Council (AEPC).
"There is a good demand for our exports from the US. Also, the European market is picking up," AEPC Chairman Premal Udani said.
The US and Europe together account for about 65 per cent of India's total garment exports. The council expects garments exports' growth to continue in 2011-12.
"We expect exports to touch USD 14 billion in the current fiscal as we are getting good orders not only from the western markets, but also from new markets like Latin America," Udani said.
During 2010-11, garments exports grew by 4.4 per cent to USD 11.1 billion compared to the previous fiscal.
The garment industry employs about 70 lakh people in the country, out of which almost half are engaged in the export sector.
Investment Seminar at Birla Sunlife (Branch - Thane)
The speaker illustrated how nature and market (Sensex and other indices) worked similarly. She then explained the cycle of market emotions.
Introduction: (15 – 20 minutes)
1. BSL Thane Branch manager had introduced his staff and the speaker.
2. He also recommended the distributor to advice the investors to invest in Liquid funds like BSL cash manager.
3. The present return in these funds is on an avg of 8.5 – 9 p.c.
4.Introduced us with few new schemes like
i. BSL Century SIP i.e. SIP + free Life insurance (cover of 20lacs to investor)
ii. Privilege club program (loyalty programs)
Ex:Pension Fund scheme
iii.MIP schemes which gives 15pc return
Iv.FMP plans for 367 days and 180days.
Presentation by Mrs.Usha Nair (70 mins)
Nature of Equities:
1. Since 2001 – 2010 the market grew by 17.94p.c. (CAGR).
2. For past 10 yrs, the market drifted to highest/lowest pts in respective years.
Ex: In may 18, 2009 when Congress won the elections the market went up by 17.34p.c in that particular yr.
Emotional Involvement:
When the investor is maximally disappointed ,that is the time , the market opportunity is high.
Understanding Investor Behavior:
Human Emotions influence investors in their decision – making process.
Some Common behavior:
People often take more risks to avoid losses than to realize gains.
Investment Myths:
Myth 1
Equity should be used to quickly doubling money
1. Why Equity is not price of path?
2.Market valuation – Forward Earnings i.e. forecasting future earnings
Myth 2
1. The speaker explained the top performing schemes of BSL Frontline Equity performance, HDFC Top 200.DSPBR Equity.
Myth 3
Myth 4
1. Nowadays, Real estate prices in Mumbai are in fashion.
As per JP Morgan research,
1. A property in Nepean sea Road is valued at 15p.c since 90yrs.
2. A property in Delhi (Kasturba Baugh) is valued at 17p.c return since 40yrs
3. A property in Chennai (up street locality) is valued at 20p.c. return since 80yrs.
Myth 5
1.101 equity mutual funds from 23 different MF houses.
2.Performance of schemes for 2003 -2011 –
95 schemes which gave CAGR > 15p.c.
Min returns = 1.71p.c.
Max returns = 41.6p.c.
Myth 6
Myth 7
1. In falling market your SIP values are less than portfolio value.
Narendra Modi & Investments in Gujarat
Gujarat chief minister Narendra Modi has been trying to wriggle out of what he believes is the Godhra straightjacket for nearly a decade. But try as he might, his links with the 2002 riots that killed hundreds of people after a coach of the Sabarmati Express train was burnt in the city of Godhra reappears like a nervous tic intermittently. Last week happened to be the latest such instance.
The US Commission on International Religious Freedom, a government watchdog, has again demanded that the US government urge its Indian counterpart to ensure that efforts to bring a case against Modi for his complicity in the 2002 Gujarat riots "are allowed to proceed in accordance with the law".
It was six summers ago that the US revoked Modi's visa on grounds of religious intolerance. In its 2011 report, the watchdog has again urged US authorities to develop a lookout list of foreigners "who are inadmissible to the United States on this basis of violations of religious freedom".
But while Modi remains persona non grata in the US since 2005, a phalanx of businessmen from America has been descending on his home state. Gujarat has turned into an investment magnet for US businesses, much like their counterparts in India, which view him with rose-tinted glasses. "Of US-India Business Council's 400 member-companies, as many as 200 of them are present in some shape or form in Gujarat," says Ron Somers, president of the influential American trade group.
The US also dominated the Vibrant Gujarat Global Investors Meet in January, sending 26 delegations made up of 156 representatives. US companies signed MoUs for investments worth Rs 13, 574 crore during the meet in sectors as diverse as pharmaceuticals and tourism, according to the Industrial Extension Bureau, a government-run body that looks to promote investments in the state. Modi deserves the credit, say US entrepreneurs, because he has almost single-handedly made it easy to do business in Gujarat.
"A CEO-stale of management seems to have energised the bureaucracy. Once the green-light is given on a project, officers are fully empowered to implement the project," says Somers. It is not clear what Modi thinks of the divisive views about him by Americans or whether he wishes to visit the US. He declined to comment for this story. American CEOs say Gujarat is the place to be for businesses.
Besides removing red tape and improving infrastructure, one big reason is the state's successful stab at weeding out corruption. Here too, credit is due to the chief minister. Modi's alleged autocratic functioning has helped the efficient hand overtake the greased palm, say people familiar with his government
Companies do not have to pay bribes for approvals because the CM is watching, they say, adding that he has taken the IAS lobby to task on petty corruption. Gujarat, says a senior bureaucrat, has an administrative model where targets are met and action is taken against complaints. "Success is breeding success
DENIP Consultants thanks Economic times of India for sharing such an article with India.
Source: Economic Times of India
Thanks,
Dewang K Mehta
DENIP Consultants Pvt. Ltd