FREQUENCY OF POSTS

There has been a comment that the posts in this blog has been infrequent.I do agree on this point.The idea behind this blog was to share picks which can create wealth in the long run.I am of the firm belief that trading is a zero sum game.The only way wealth can be created is to invest with a long term outlook and ride the company's growth.Therefore i am forced to post only when i find value in a scrip and the medium to long term outlook is extremly bright.So,barring unforseen circumstances the company should be able to capture growth and that should reflect in the share prices in times to come.

On the rupee front there is no doubt in my mind that it is undervalued substantially.In fact that has been the case for the last several years.It is the wrong assumption of the government that a weak rupee is the only route to ensure that the exports and that includes IT competitive.China for instance has used several tools to make its exports competitive and in many cases enable their exporters to sell their products below their cost of manufacture.In my view if the government had not intervened aggresively in the rupee-dollar equation the rupee would be should be around Rs.20 or lower.This has several implications though.Exports would be hit.But our largest bill on the import side "Oil" would be far cheaper than it is today and imports of capital goods would be grossly cheaper.The last one is very important because it would have helped create a large scale infrastructure in our country at a far cheaper cost than what we are doing today.But i presume the government will not have the guts to do that.

As far as investment in IT companies goes my firm belief is that they will continue to do well in the future (of course the blips will be there because of forex issues etc) because the knowledge and the scale barriere created in this sector will continue to work in our favour in the long run.Therefore i continue to be bullish on TCS,Iflex and a few other companies in the sector.

CURRENT STATE OF MARKET

After a correction of over 2000 points in the sensex most of the investors are questioning whether the "INDIA STORY" is still intact.World over if you have seen a country goes through a inflexion point in its history and my firm belief is that "INDIA's time" has come now.Of course there will be blips and the markets would give corrections and periods of euphoria but the more one sees around the world the more one is convinced that the structural change in the economy of the country will result in a long period of economic boom.Currently across the world there are few countries who are growing at the rate that India and China are and this has been well documented over the years.The stock markets will give entry points at various periods of time to long term investors to benefit in the growth of the economy.Also the leadership of the market will keep changing from time to time but the key thing to focus is on the domestic demand and the companies that will benefit from the same.The IT story continues to be robust and my belief is that if there is a slowdown or recession in the US than India will emerge stronger after a brief pain period.

Keep logging for more posts.

Response to comments

There have been some comments on the postings made in this site.

1.Valuations-While i do take the point that valuations is the most important element in deciding whether the pick is good or not this site is primarily intended to give leads to long term investors to do further work in the companies listed and decide for themselves whether to invest or not.However i do take the point positively and would put current valuations in perspective so that investors get more idea.

As far as HEG goes the current price goes on a expected EPS of Rs.20 for the year ended March 07 the market price is currently discounted by 8.5 times.Target price for this is Rs.450-Rs.500 over a period of 2 years.

2.Current price and target price would be listed and the investment period would be listed at the time of posting.