Wednesday, February 3, 2010

The world still underestimates the influence of India's infrastructure demand over the next 3-5 years, says expert

CEMENT, coal and indus trial metals producers across Asia will benefit in coming years from a mas sive push by India to over haul its infrastructure, a fund manager at JPMorgan Asset Management said on Tuesday.
Joshua Tay, who over sees $4 billion in Asian stocks says infrastructure investments by India, Asia's third largest economy, will provide another major driv er for these markets, follow ing huge investments by China in recent years.
Bloomberg "I think the world still underestimates the influ ence of India's demand over the next 3-5 years given the amount of infra structure required," Tay told Reuters. "There will be a lot more demand for coal, steel, aluminium. I don't think it's been factored into most people's outlooks.
"There will be a huge shortfall in coal, given the amount of power plants that are being built or will be built in India."
Engineering conglomerate Larsen & Toubro is an example of a firm which should benefit, Tay said but declined to give other names. "We are moving into the commodity stocks, steel and aluminium...and ce ment is one of the sectors we will focus on."
The country needs investments of $500 billion in infrastructure in the five years to 2012. Poor infrastructure is estimated to knock two percentage points off the country's growth, currently running around 7 per cent. Tay does not expect recent policy tightening moves in India and China to take the gloss off stock markets in these countries though China's recent attempts to curb over-exuberant bank lending sparked selling in emerging and global equities.
Both countries have hiked reserve requirements for banks and India is expected to raise interest rates very soon.
"The key thing is for corporate earnings to keep pace with stock market performance," Tay said.

My Comments:
That is the fantestic news of the day.....

$500 bn investment in 5 yrs? $500 bn = 22,50,000 cr rupees...and that surpass all estimates of any type of investments.....What can be the impact of this can anyone imagine?Money has to flow in India, there is no other distination.There can be no other.Yesterdays rally proves that.
USA Prez speaking on India is no flash in a pan....or he is just not talking nonsense.Obama has got all information about what India is doing and how she will expand......He is merely not mentioning India just for the sake of doing it...he is serious....


  1. Hi Rajeevji,

    Request you to please share your view/finding on IKF Technologies. i am tracking this stock from 2008 @RS 3, now CMP@4.07

    as per my analysis future prospects are bright. Stock price could definitely touch around INR 200+ in 2012

    Your comments please...



  2. Hi Abhijit,
    I track IKF Techno even before u r tracking.It is 1 paidup stock and when u put a target at 200+ in 2012 then it seems to me a very high target because 200+means 2000 for 10 paidup stock.
    I know they are in Jathropa Plantation and in bio fules and they are showing good results but still I feel 200+ is too high for me.I willbe glad to see that price ofcourse.
    Though I hold no position in this stock..
    But acheieving the target of 200 they have to put atleast and eps of 15 for 1 paidup means 150 eps for 10 paidup.
    Do you think that is possible?
    You can mail me at my id which is written at the top of my main page if you have to write me about why you think IKF can touch 200+ and what you have found.Or is it so that 200+ is 10paidup and so 20 can be the target.......

  3. Dear Mr Rajeev

    You have mentioned in you post that you are extremely bullish on srei Infra now onwards, may be due
    the new development like SREI all set to buy Bengal based power distribution co DPSC, the may entered in to power sector and power distribution in big way

    Iam i correct Mr Rajeev

  4. Hi Rajeev,
    adding to your update of $500 billion investment.
    Pasting here comment by Bhat of SBI taken from today's BS.

    Bankers identified infrastructure as one area that will require large doses of funding, with State Bank of India Chairman O P Bhatt saying the fund requirement, which was earlier estimated at $500 billion, was now passé. “We are talking of a trillion-plus expenditure now,” he said.

    So thats double!

    With Regards,

  5. Hi Rajivji,

    How do you look at Sterlite technology in terms of Business model, Managemnt, Current valuation and over all future.

    I has some good results since last 2/3 qrs.

    Plese reply back if u have tracked it.


  6. Hi rajeev,
    Do you think this is last or you see more

  7. Deb,
    I gave a call of Strelite Techno around 125 to one of my freind.It has more then tripled from there.
    Though it looks good even now but I am hesistant to give a call now on that...

  8. TT,
    It depends on how hedge funds are going to do.If they still wants to sell, there can be more downside.We have no control on that only thing we can do is buy on DIPS....
    Lesha Energy was up yesterday and Rasandik Eng was came out with great results....
    There were news that Venus Remedies and Rasandik has big debts to those who hold both of them need to take decision on their own.
    What I will say it, better safe then sell both....I think one is earning in Rasandik and Venus went up and come back down.
    Those who have risk apetite should hold both......but it depends upon individual.....