Lanco Infratech fixes Record Date for Stock Split

Lanco Infratech Ltd has announced that consequent upon the approval of the members for the sub-division of the equity shares by passing the Resolutions through Postal Ballot and Minutes of the same recorded on December 14, 2009, the Board of Directors of the Company vide Resolution passed by Circulation, approved and fixed January 05, 2010, as the record date for giving effect to the Sub-division of One Fully paid up Equity Share of Face Value of Rs. 10/- (Rupees Ten only) each into Ten Equity Shares of Face Value of Re. 1/- (Rupee One only) each fully paid up.

The stock closed the day at Rs.536.35, down by Rs.14.60 or 2.65%. The stock hit an intraday high of Rs.558.65 and low of Rs.532.

The total traded quantity was 423049 compared to 2 week average of 366438.

Wells Fargo Common Stock Offering Raises $12.25 Billion through offer of 489.9 million shares

SAN FRANCISCO: Wells Fargo & Company (NYSE: WFC) said today that underwriters in Wells Fargo's public offering of 426 million shares of common stock have fully exercised their option to purchase an additional 63.9 million shares. This represents 15 percent of the shares purchased in the original offering.

The combination of the original offering of 426 million shares of common stock plus the additional 63.9 million shares results in a total offering of 489.9 million shares of common stock valued at $12.25 billion.

"We are very pleased with the positive reception for this equity offering, and we appreciate the confidence investors have demonstrated in Wells Fargo's strength and future prospects," said Wells Fargo Chief Financial Officer Howard Atkins.

Under terms of the TARP redemption agreement approved by U.S. banking regulators, this increase in size eliminates the requirement to execute asset sales to generate $1.5 billion in equity.

The offering is expected to be complete and proceeds received December 18, 2009. The original offering was announced December 14 and priced December 15. Wells Fargo will use the proceeds of this offering to redeem its series D preferred stock from the U.S. Treasury for $25 billion, repaying in full the government's TARP investment.

Wells Fargo Securities and Goldman Sachs & Co. are acting as lead underwriters for the offering.

Copies of the registration statement (including the base prospectus), the prospectus supplement and other documents Wells Fargo has filed with the SEC containing more complete information about Wells Fargo and the offering are available for free by visiting EDGAR on the SEC Web site at www.sec.gov. Alternatively, Wells Fargo, any underwriter or any dealer participating in the offering will arrange to send investors the prospectus if requested by contacting Wells Fargo Securities, LLC, 375 Park Avenue, New York, NY 10152-4077, toll-free telephone: 1-800- 326-5897, or by emailing equity.syndicate@wachovia.com or Goldman, Sachs & Co., Prospectus Department, 85 Broad Street, New York, NY 10004, toll-free telephone: 1-866-471-2526, facsimile: 1-212-902-9316, or by emailing prospectus-ny@ny.email.gs.com.

This news release shall not constitute an offer to sell or a solicitation of an offer to buy any securities, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

In accordance with the Private Securities Litigation Reform Act of 1995, we caution you that this news release contains forward-looking statements about Wells Fargo, including statements about when and how the Company will repay TARP. Forward-looking statements speak only as of the date made, and we do not undertake to update them to reflect changes or events that occur after that date. Several factors could cause actual results to differ materially from forward-looking statements including our ability to access capital markets on favorable terms. For a discussion of factors that could cause actual results to differ from expectations, refer to our reports filed with the Securities and Exchange Commission and available on the SEC's website at www.sec.gov, including our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2009, June 30, 2009 and September 30, 2009, and our Annual Report on Form 10-K for the year ended December 31, 2008, as amended by our Current Report on Form 8-K filed May 11, 2009.

Citi Partners with India Post for Landmark Remittances Solution

Hong Kong – Citi has announced a landmark partnership with the Department of Post, Government of India (India Post) to enhance its recently launched MO Videsh remittance product. This international remittance service is powered by Citi's innovative WorldLink® Payment Services, and provides India Post the ability to send payments in more than 130 currencies globally through its existing Eurogiro payments platform.

Under the partnership, India Post will provide global remittance services to its customers in more than 800 head post offices across the country within three months. India Post plans to extend the service to more than 8,000 post offices nationwide within one year.

This deal is significant for both Citi and India Post, leveraging the Citi and Eurogiro partnership to provide India Post with the widest range of currencies globally. Citi's partnership with Eurogiro was established in August 2007 to enable members of Eurogiro, a low value payments network of postal organizations and financial institutions, access to Citi's existing distribution capacity and payment solutions.

With more than 25 years of experience, WorldLink Payment Services is at the forefront of the cross-border payments industry with its powerful and flexible multicurrency platform. Processing more than US$750 billion in transactions annually, WorldLink is the entrusted provider of cross border payment solutions to more than 2,700 client relationships globally, including the public sector, financial institutions, corporations and third party administrators.

Anthony Nappi, Managing Director, Regional Head of Global Transaction Services, Asia Pacific, Citi, said, "This innovative service launch between Citi Global Transaction Services and India Post represents a landmark in the Indian remittances space and clearly sets a new market standard. We are proactively taking a unique approach to meeting the needs of key client segments and remain committed to creating partnerships with post offices regionally and globally based on their future business needs."

"The payments partnership between India Post and Citi demonstrates Eurogiro's strength to bring together the postal and the banking world through the Eurogiro payments platform and global community," notes Juanita Woodward, Director, Customer Relations Asia Pacific, Eurogiro A/S. India Post is the most recent postal organization to join the Eurogiro payments network community, which has members located in more than 50 countries, and illustrates an increased focus by postal organizations around the globe to expand international payment services to the local community through the Eurogiro payments network and community.

McDonough to retire from Bank of America Merrill Lynch

NEW YORK - Bank of America (NYSE:BAC) announced the retirement of William J. McDonough, effective December 31. The former president of the Federal Reserve Bank of New York and former chairman of the Public Company Accounting Oversight Board, McDonough joined Merrill Lynch & Co. nearly four years ago as vice chairman and special advisor to the chairman and continued in this role at Bank of America Merrill Lynch. McDonough advised senior management and was actively involved in business development efforts with governments and financial institutions around the world.

While at the Fed from 1993 to 2003, McDonough played a key role in efforts to preserve liquidity in the financial markets after the attacks of September 11, 2001, and was instrumental in successful efforts to recapitalize Long Term Capital Management after its financial problems in 1998. During this time, he also served as vice chairman and a permanent member of the Federal Open Market Committee, the group responsible for formulating the nation's monetary policy. McDonough also was a member of the Board of Directors of the Bank for International Settlements and chairman of the Basel Committee on Banking Supervision. Earlier he was vice chairman of First Chicago Corp., and its bank, First National Bank of Chicago. McDonough is also a senior member of the Group of Thirty, an influential Washington-based financial advisory body.

"Bill McDonough has been at the pinnacle of financial services industry for decades," stated Kenneth D. Lewis, chief executive officer of Bank of America Corporation. "Having known Bill for many years, I'd like to thank him for his many contributions, specifically to our company and more broadly to our industry as a leader in both the public and private sectors."

"Bill McDonough has one of the finest minds in public policy," said Anne Finucane, global chief strategy and marketing officer at Bank of America. "Our company, the legacy Merrill Lynch firm, and the senior managers who have worked with Bill have greatly benefited from his expert insights, thoughtful counsel and wealth of relationships."

Prior to his career with First Chicago, McDonough was with the U.S. State Department from 1961 to 1967 and the U.S. Navy from 1956 to 1961.

McDonough is currently a member of the board of directors of the New York Philharmonic Orchestra. He is also Chairman of the Investments Committee for the United Nations Joint Staff Pension Fund.

McDonough earned a master's degree in economics from Georgetown University in Washington, D.C. and a bachelor's degree, also in economics, from Holy Cross College in Worcester, Massachusetts.

Aurobindo Pharma gets final approval for Cetirizine Hydrochloride Syrup (Rx)

Aurobindo Pharma Ltd is pleased to announce that it has received the final approval for Cetirizine Hydrochloride Syrup 1mg/mL (ANDA No 090751) from the US Food & Drug Administration (USFDA). This approval of Cetirizine Hydrochloride Syrup is under Prescription drug product category.

Cetirizine Hydrochloride Syrup 1mg/mL is the generic equivalent of McNeil Consumer Healthcare Zyrtec Syrup 1mg/mL. Cetirizine Hydrochloride Syrup is indicated for the relief of symptoms associated with seasonal allergic rhinitis in adults and children above 2 years of age and falls under the Anti-Allergic segment.

Aurobindo has a total of 110 ANDA approvals (82 Final approvals and 28 Tentative approvals) from USFDA.

The stock was trading at Rs.891, up by Rs.11.65 or 1.32%. The stock hit an intraday high of Rs.894.20 and low of Rs.875.15.

The total traded quantity was 20109 compared to 2 week average of 41335.

KEC International secures six new projects worth Rs 550 crores

KEC International Ltd. (KEC), a global leader in the power transmission EPC business and a part of the Rs. 15,000 crore RPG Group, has won major orders in Algeria and Abu Dhabi worth Rs. 474 crore and Rs. 76 crore respectively, against international competition.

In Algeria, for CEEG Spa, KEC will undertake five turnkey projects of 400 KV, 200 KV and 60 KV covering both single and double circuit transmission lines worth Rs. 474 crore. The total length of these five projects is 858 km and the completion period ranges from 12 to 18 months.

In Abu Dhabi. KEC will execute a project of modification and realiocation on existing lines with design and supply of Emergency Line Restoration System (ERS) in Ruwais & Shuweihat for Abu Dhabi Transport Authority / Ghantoot Transport & Gen. Cont. Est. This project is to be completed within 12 months. The value of this order is Rs. 76 crore.

"In Abu Dhabi we are diversifying our client base and we will perform our first International ERS (Emergency Line Restoration System) project," said Mr. Ramesh Chandak, MD & CEO, KEC International Ltd.

The stock was trading at Rs.583.05, up by Rs.15.55 or 2.74%. The stock hit an intraday high of Rs.589.90 and low of Rs.571.

The total traded quantity was 47221 compared to 2 week average of 28258.

ONGC Board declares Interim Dividend of 180% for 2009-10

Oil & Natural Gas Corporation Ltd (ONGC) has announced that the Board of Directors of the Company at its meeting held on December 18, 2009, have declared an Interim Dividend of Rs. 18 (Rs. Eighteen) per equity share of Rs. 10 each for the Financial Year 2009-10.

The stock closed the day at Rs.1185.50, down by Rs.14.10 or 1.18%. The stock hit an intraday high of Rs.1205 and low of Rs.1182.

The total traded quantity was 44294 compared to 2 week average of 76016.

Websol Energy to approve allotment of bonus shares on Dec 30, 2009

Websol Energy Systems Ltd has announced that a meeting of the Board of Directors of the Company will be held on December 30, 2009 to approve the allotment of Bonus Shares to the Members of the Company whose names appear on the Register of Members as on the Record Date.

The stock was trading at Rs.365, up by Rs.0.70 or 0.19%. The stock hit an intraday high of Rs.370 and low of Rs.360.10.

The total traded quantity was 4881 compared to 2 week average of 3629.

Jaiprakash Hydro-Power

With reference to the earlier announcement dated December 14, 2009 regarding (Sanction of Scheme of Amalgamation of Jaiprakash Power Ventures Ltd. with Jaiprakash Hydro Power Ltd), Jaiprakash Hydro Power Ltd has informed BSE that formal order dated December 14, 2009, has been received from Hon'ble High Court of Himachal Pradesh at Shimla and the same has been filed with the Registrar of Companies, Punjab, Himachal Pradesh & Chandigarh on December 14, 2009 making the Scheme of Amalgamation effective from December 14, 2009. Necessary formalities of change of name of the Company to Jaiprakash Power Ventures Ltd., in terms of the Scheme, are being carried out with the Registrar of Companies, Punjab, Himachal Pradesh & Chandigarh.

SMS tariff war

The battle continues - will the customer win the war? The tariff war in the mobile telecom industry has now extended and shifted its focus to the Short Messaging Services (SMSes). Dual technology player Reliance Communications (RCom) has triggered a tariff war in the SMS segment. The company has launched two SMS plans which are available to both pre-paid and post paid users of the GSM and CDMA service.

SMSes under one plan will be charged at 1 paisa per SMS, but in order to avail of the same, users would have to pay a monthly fee of Rs 11. In another plan the users can avail of 15,000 SMSes free, by paying Re 1 per day as a fee. In other words it means 500 SMSes per day for a rupee charged; a great offer.

The above plans will be appealing to customers with high SMS usage – typically youth and professionals across India.

The tariff war is likely to continue till consolidation sets in the mobile telecom industry.

Since the mobile telecom industry is more voice driven, the move may not have too much impact on the industry. However, it will indeed be pro-customer as it will lead to increase in savings.

IPO subscription to be made easy for HNIs & firms

From January 2010, HNIs and firms will be eligible to use the banking channel called Application Supported by Blocked Amount (ASBA) to buy stocks in the primary (IPO) market.

Under this channel, when an investor applies to an IPO, the funds do not immediately flow out from his account. The bank blocks the value of the shares applied for and the funds are not disbursed till the shares are allotted. Customers cannot use this money, since it is blocked.

Earlier in July 2008, SEBI allowed only retail investors to subscribe to IPOs through this channel, but capped the maximum amount of bid at Rs 1 lakh.

As a second phase, the channel will now be thrown open to a wider group of investors who will be able to make multiple applications at different prices within the price band of an IPO.

SEBI has asked banks to be ready with their software and to make necessary changes in their software.

We believe that the move will reduce the time taken between the public issue and listing. This will be in the interest of investors as it will make IPO subscriptions easy and ensure hassle-free transactions. Investors will no longer have to wait for the receipt of refund cheques.

Dubai debt trap

Dubai, which is seen as the global financial hub, got into a debt trap with Dubai World struggling with liabilities to the tune of USD 59 billion. The Dubai Government too hasn’t guaranteed the debt of Dubai World. As per a government statement, the company has received financing based on a project schedule basis and not on government guarantees.

This sent shock waves across the financial markets, significantly impacting stock prices across the globe. S&P too has cut the credit ratings of six Dubai government-linked companies, including ports operator DP World, to junk status. S&P also placed the ratings of four Dubai-based banks on negative outlook, due to their exposure to Dubai World.

Banning insurance commissions

The panel constituted last year, chaired by D Swarup, the Chairman of the Pension Fund Regulatory and Development Authority (PFRDA) presented its report to the Government. The panel was asked among other things:

• How to stop mis-selling of financial products
• How to raise financial literacy among citizens

With respect to the insurance industry, the panel has recommended in its report, that the up-front commissions embedded in the premium should be done away in a phased manner as under:

Year	Commissions
2009	15%
2010	7%
2011	0%

The main intention of the panel is to stop mis-selling of products as agents and financial advisors often push financial products where they can earn more, without the investors in mind.

The move has been opposed by the Insurance Regulatory & Development Authority (IRDA) and Life Insurance Council, the industry lobby for the insurance sector.

We believe that if the recommendations to do away with insurance commissions go through government approvals, it will be in the interest of the investors.

Banking made easy?

PersonalFN Impact Indicator

In a move to make banking transactions more easy and convenient, the Reserve Bank of India (RBI) permitted banks to adopt the ‘Business Correspondents Model’ from Monday – November 30, 2009.

It means banks will now be able to appoint ‘Business Correspondents’ (BCs) enabling them (banks) to deepen the banking system. RBI has allowed entities like individual kirana/medical/fair price shop owners, PCO operators, agents of government-sponsored small savings schemes, insurance agents, petrol pumps owners and retired teachers to act as BCs of banks.

The principle for appointing such BCs are:

• Experience of these individuals in cash handling (cash inflow and outflow)
• Being residents of the area in which they propose to operate

According to RBI, the charges for services provided by the BCs, will be levied in a transparent manner and BCs will not be allowed to charge customers directly.

The model has evolved after experiencing limitations in the traditional ‘brick and mortar' banking model. As per RBI notification, the new model (Business Correspondents Model) will enable banks to accelerate their goal of financial inclusion.

However, we believe that though the move seems to make banking easier and convenient, there are some serious operational glitches like cash management, security and technology, which need to be considered for safe banking.

India's GDP beats forecast

India's GDP (Source: Bloomberg)

The Gross Domestic Product (GDP) expanded during the second quarter (July – September) of the fiscal year 2010 by 7.9%. The key drivers for this strong figure are:

• Pickup in manufacturing sector
• Increased government expenditure
• Robust investments
• Lower interest rates
• Higher government salaries & pay commission arrears
• Increased incomes especially in the rural areas due to greater social spending and high farm goods prices
• Modest growth in farm output despite drought

In the first quarter (April – June) of the present fiscal year, the economy had expanded 6.1%. Interestingly now, the growth is close to the same level (i.e. 7.7%), of the second quarter (July – September 2008) of the fiscal year 2009, thus indicating that the economy is back on the health track. The stock market too has cheered this news during the week.

Given the attractive GDP numbers, we believe there are likely chances of:

• Government withdrawing stimulus – certainly beginning the phasing out over next few months
• RBI tightening interest rates soon

How to select a mutual fund?

Mutual funds offer the most convenient way of investing in equity, debt and money markets. The increased participation of Indian investors bears testimony to the fact that there is a widespread realisation of the same. Also over the years, the Indian mutual fund industry has grown manifolds, not only in terms of size but also in terms of offerings. While on one hand that is good; the increased number of offerings has also given rise to a state of dilemma in the mind of investors. They often get confused when it comes to selecting the right fund from the plethora of funds available. And even worse, many investors think that 'any' mutual fund can help them achieve their desired goals.

The fact is, not all funds are the same. There are various aspects within a fund that an investor must carefully consider before short-listing it for making investments. In this article we highlight some of those aspects.

• Performance: The past performance of a fund is important in analysing a mutual fund. However, one must remember that simply because a fund has performed well in the past does not mean that it will perform well in the future as well. It simply indicates the fund’s ability to clock returns across market conditions. And if the fund has a well-established track record, the likelihood of it performing well in the future is higher than a fund which has not performed well.

The following factors should be considered while evaluating a fund’s performance:

1) Comparisons: A fund’s performance in isolation does not indicate anything. Hence, it becomes crucial to compare the fund with its benchmark index and its peers, so as to deduce a meaningful inference. Again, one must be careful while selecting the peers for comparison. For instance, it doesn’t make sense comparing the performance of a midcap fund to that of a largecap.

‘Don’t compare apples with oranges’

2) Time period: It’s pertinent for investors to have a long term (atleast 3-5 years) horizon if they wish to invest in equity oriented funds. Hence, it becomes important for them to evaluate the long term performance of the funds. This does not imply that the short term performance be ignored. Performance over the short term should also be evaluated; however, the focus should be more on the long term performance. Besides, it is equally important to evaluate how a fund has performed over different market cycles (especially during the downturn). During a rally it is easy for a fund to deliver above-average returns; but the true measure of its performance is when it posts superior returns than its benchmark and peers during the downturn.

Choose a fund like you choose a wife – one that will stand by you in sickness and in health

3) Returns: Returns are obviously one of the important parameters that one must look at while evaluating a fund. But remember, although it is one of the most important, it is not the only parameter. Many investors simply invest in a fund because it has given higher returns. In our opinion, such an approach for making investments is flawed. In addition to the returns, investors must also look at the risk parameters, which in-turn explain how much risk the fund has taken to clock higher returns.

4) Risk: Risk is normally measured by Standard Deviation. It signifies the degree of risk the fund has exposed its investors to. Higher the Standard Deviation, higher the risk taken by the fund to clock returns. From an investor’s perspective, evaluating a fund on risk parameters is important because it will help them to check whether the fund’s risk profile is in line with their risk profile or not. For example, if two funds have delivered similar returns, then a prudent investor will invest in the fund which has taken less risk.

5) Risk-adjusted return: This is normally measured by Sharpe Ratio. It signifies how much return a fund has delivered vis-à-vis the risk taken. Higher the Sharpe Ratio, better is the fund’s performance. From an investor’s perspective it is important because they should choose a fund which has delivered higher risk-adjusted returns. Infact, this ratio tells us whether the high returns of a fund are attributed to good investment decisions, or to higher risk.

6) Portfolio Concentration: Funds that have a high concentration in particular stocks or sectors tend to be very risky and volatile. Hence, investors should invest in these funds only if they have a high risk appetite. Ideally, a well diversified fund should hold no more than 40% of its assets in its top 10 stock holdings.

Make sure your fund does not put all its eggs in one basket

7) Portfolio Churning: The portfolio turnover rate measures the frequency with which stocks are bought and sold. Higher the churning, higher the volatility. The fund might not be able to compensate the investors adequately for the higher risk taken.

Invest in funds with a low turnover rate

• Fund Management: The performance of a mutual fund scheme is largely linked to the Fund Manager and his team. Hence, it’s important that the team managing the fund should have considerable experience in dealing with market ups and downs. Also, investors should avoid fund’s that owe their performance to a ‘star’ fund manager. Even if the fund manager is present today, he might quit tomorrow, and then the fund will be unable to deliver its ‘star’ performance without its ‘star’ fund manager. Therefore, the focus should be on the fund houses which are strong in their systems and processes.

Fund house should be process-driven and not 'star' fund-manager driven

• Costs: If two funds are similar in most contexts, it might not be worth buying the high cost fund if it is only marginally better than the other. Simply put, there is no reason for an AMC to incur higher costs, other than its desire to have higher margins.

The two main costs incurred are:

1) Expense Ratio: Annual expenses involved in running the mutual fund include administrative costs, management salary, overheads etc. Expense Ratio is the percentage of assets that go towards these expenses. Every time the fund manager churns his portfolio, he pays a brokerage fee, which is ultimately borne by investors in the form of an Expense Ratio. Therefore, higher churning not only leads to higher risk but also higher cost for the investor.

2) Exit Load: Due to SEBI’s recent ban on entry loads, investors now have only exit loads to worry about. An exit load is charged to investors when they sell units of a mutual fund within a particular tenure; most funds charge if the units are sold before a year. As exit load is a fraction of the NAV, it eats into your investment.

Try investing in a fund with a low expense ratio and stay invested in them for longer duration.

Among the factors listed above, while few can be easily gauged by investors, there are others on which information is not widely available in public domain. This makes analysis of a fund difficult for investors and this is where the importance of taking the help of a mutual fund advisor comes into fore. At Personal FN, we spend a lot of time and effort in short-listing funds which are best for investors, by using various qualitative and quantitative techniques.

RedChip Companies Announces Its 2009 Top-Performing Stocks

ORLANDO, Fla., Oct. 26, 2009 (GLOBE NEWSWIRE) -- RedChip Companies, Inc. (http://www.RedChip.com) today announced its top-performing stocks for 2009: L&L International Holdings, Inc.; China Education Alliance, Inc.; India Globalization Capital, Inc.; Longwei Petroleum Investment Holding Ltd.; China Wind Systems, Inc.; China Gengsheng Minerals, Inc.; Alter NRG Corp.; ZAGG Inc.; Aethlon Medical, Inc.; and Royal Standard Minerals Inc. RedChip is an international financial relations and research firm servicing public companies with market caps up to $1 billion. The stock's performance is based on the price of the stock on the date the company engaged RedChip's services.

-- China Education Alliance (NYSE Amex:CEU), a company offering high-quality online and onsite educational and vocational services for student and adults in China, is up 79% post-coverage, moving from $3.20 on May 25, 2009 to $5.74 at market close on October 23, 2009. Average daily volume has increased 2,252% from the month prior to coverage to 335,487 average daily shares traded in the current 30-day period.

-- Longwei Petroleum (OTCBB:LPIH), a profitable diesel, gasoline, fuel oil, and solvent oil distributor operating in China's Shanxi Province, is up 636% post-coverage, moving from $0.28 on April 8, 2009 to $2.06 at market close on October 23, 2009. Average daily volume has increased 998% from the month prior to coverage to 409,447 average daily shares traded in the current 30-day period.

-- L&L International Holding (OTCBB:LLFH), a U.S. publicly traded energy company operating profitable coal mines in China's resource-rich Yunnan Province, is up 515% post-coverage, moving from $0.97 on April 14, 2009 to $5.79 at market close on October 23, 2009. Average daily volume has increased 11,517% from the month prior to coverage to 109,317 average daily shares traded in the current 30-day period.

-- India Globalization Capital (NYSE Amex:IGC), a company developing infrastructure in India and focusing on materials and iron ore production, is up 43% post-coverage, moving from $1.29 on August 19, 2009 to $1.85 at market close on October 23, 2009. Average daily volume has increased 462% from the month prior to coverage to 910,184 average daily shares traded in the current 30-day period.

-- China Wind Systems (OTCBB:CHWY), a China-based manufacturer of rolled rings and other forged products serving wind turbine manufacturers, is up 21% post-coverage, moving from $4.23 (split-adjusted) on August 31, 2009 to $5.10 at market close on October 22, 2009. Average daily volume has increased 64% from the month prior to coverage to 108,795 average daily shares traded in the current 30-day period.

-- China Gengsheng Minerals (OTCBB:CHGS), a China-based manufacturer of mineral-based, heat-resistant and energy-saving monolithic refractories, functional ceramics, fracture proppants and fine-precision abrasives for such industries as steel, oil and solar energy, is up 119% post-coverage, moving from $0.80 on August 31, 2009 to $1.75 at market close on October 23, 2009. Average daily volume has increased 2,894% from the month prior to coverage to 103,524 average daily shares traded in the current 30-day period.

-- ZAGG (OTCBB:ZAGG), a producer of mobile electronics and audio accessories including the patented gadget protector invisibleSHIELD(TM), is up 193% post-coverage, moving from $2.05 on April 3, 2009 to $6.01 at market close on October 23, 2009. Average daily volume has increased 29% from the month prior to coverage to 186,847 average daily shares traded in the current 30-day period.

-- Alter NRG Corporation (TSX: NRG) (Other OTC:ANRGF), an emerging clean, alternative energy company who provides technology and services to facilitate the gasification of coal, household and industrial waste and biomass to produce ethanol and power, is up 163% post-coverage, moving from $0.97 on May 22, 2009 to $2.55 at market close on October 23, 2009. Average daily volume has increased 344% from the month prior to coverage to 14,833 average daily shares traded in the current 30-day period.

-- Aethlon Medical, Inc. (OTCBB:AEMD), a creator and manufacturer of diagnostic and therapeutic filtration devices used to treat infectious diseases and cancer, is up 220% post-coverage, moving from $0.20 on April 3, 2009 to $0.64 at market close on October 23, 2009. Average daily volume has increased 325% from the month prior to coverage to 461,441 average daily shares traded in the current 30-day period.

-- Royal Standard Minerals Inc. (OTCBB:RYSMF), an advanced-stage mining company, is up 121% post-coverage, moving from $0.061 on September 28, 2009 to $0.135 at market close on October 23, 2009. Average daily volume has increased 24% from the month prior to coverage to 186,102 average daily shares traded in the current 30-day period.

Europe, US stocks fall as dollar hits commodities

European and U.S. markets dropped Monday as a rising dollar reversed gains in oil company stocks, and financials slipped after Dutch banking and insurance giant ING announced plans to split in two.

After spending most of the day moderately higher, Britain's FTSE 100 closed down 1 percent to 5,191.74, Germany's DAX fell 1.7 percent to 5,642.16 and France's CAC 40 lost 1.7 percent to 3,744.45.

In early afternoon trading in New York, the Dow Jones industrial average index fell 0.9 percent to 9,883.45, while the Standard & Poor's 500 index lost 0.9 percent to 1,069.37.

Earlier, Asian markets rose, boosted by data showing South Korea's economy grew at its fastest rate in over seven years, underscoring the region's strengthening economic recovery.

In Europe and on Wall Street, oil companies initially strengthened, helped by the price of crude that hit a year-high of $82 a barrel last week. But those gains were largely wiped out as the dollar turned higher against other currencies in late afternoon European trading.

A stronger dollar often means lower oil prices, which in turn hurts the outlook for oil companies.

Banks on both sides of the Atlantic also saw losses after Dutch banking group ING Groep NV said it will split itself in two, spinning off its insurance arm to simplify its business and issuing ⁈llion ($11.3 billion) in new shares to repay state bailout money. Its stock plummeted around 18 percent in Europe and the U.S.

Before the dollar strengthened, trading in Europe was fairly subdued, as investors awaited earnings reports from U.S. companies and others later in the week and U.S. gross domestic product figures on Thursday.

Investors have been hunting for definitive signs of growth in recent weeks and the report on GDP, the broadest measure of the economy's health, would provide the clearest sign yet of how far the economy has bounced back from its depths earlier in the year.

Earnings reports released throughout the week should also provide the insight traders crave. The health of the consumer will be analyzed through the results of companies such as Kellogg Co., Procter & Gamble Co. and Visa Inc. Consumer spending accounts for more than two-thirds of U.S. economic activity.

The energy and insurance industries also will be in focus throughout the week with ConocoPhillips and Exxon Mobil Corp. scheduled to report.

"Shares have lost some direction over recent weeks as investors have started to worry that the gains seen since the first part of the year have got ahead of the economic recovery," said Philip Gillett, sales trader at IG Index.

"We may well see some choppier trading in the days to come, ahead of Thursday's U.S. GDP figures but, barring any surprises here, most investors seem happy to pounce on these sell-offs and pick up stock on the cheap."

Markets in Asia were spurred on after South Korea's central bank said economic growth accelerated to 2.9 percent in the third quarter from the previous quarter _ the fastest growth since the first quarter of 2002.

Asia's fourth-largest economy has been bolstered by government stimulus spending, low interest rates, and a falling won which boosts exports. Massive stimulus spending also played a part in China's economic growth accelerating in the third quarter, according to official figures last week.

"It's a full-fledged recovery in Korea," said David Cohen, chief of Asian forecasting at Action Economics in Singapore. He termed "dramatic" the economy's turnaround from the depths it hit late last year as the financial crisis unfolded.

South Korea's Kospi advanced 1 percent to 1,657.11 and Japan's Nikkei 225 stock average rose 0.8 percent to 10,362.62. Hong Kong's market was closed for a holiday.

China's Shanghai benchmark gained 0.1 percent in choppy trade as investors worried the government might temper its stimulus policies following the acceleration in third quarter growth. Taiwan's market rose 0.3 percent, Singapore's index gained 0.2 percent, and India's Sensex was up 0.6 percent.

Australia bucked the trend with the S&P/ASX 200 index falling 0.6 percent. In Sydney trade, coal miner Felix Resources Ltd. jumped 4 percent after the government approved a takeover by China's Yanzhou Mining Co.

Oil prices fell below $79 a barrel in Europe after last week's jump to $82 a barrel _ a 2009 high. Benchmark crude for December delivery lost $1.96 cents to $78.54 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell 69 cents a barrel on Friday.

SCI posts Rs941-crore net profit, pays Rs221-crore dividend to government news

Shipping Corporation of India (SCI), the country's largest shipping company, has reported a net profit of Rs940.7 crore on a turnover of Rs4,564.5 crore for the financial year 2008-09. SCI also allotted bonus shares in the ratio of 1:2 and declared a dividend of 65 per cent on the increased share capital for the financial year.

The company allotted one bonus share each to shareholders for every two shares held, which increased the paid-up share capital of the company to Rs42.35 crore.

The annual general meeting of the company held on 30 September 2009 approved the payment of final dividend of 65 per cent, ie, Rs6.5 per share of face value Rs10 each, on the increased share capital.

SCI chairman and managing director S Hajara handed over a demand draft for a sum of Rs220.54 crore to GK Vasan, minister for shipping, towards final dividend to the government for the financial year 2008-09.

The government holds an equity stake of 80.12 per cent in the Shipping Corporation of India.

SCI, the only Navratna PSU under the ministry of shipping, owns a fleet of 80 vessels of deadweight of 5.4 million tonnes, including 30 crude oil tankers, 10 product tankers, 18 bulk carriers, 10 offshore support vessels, 5 container carriers, 3 chemical carriers, 2 LPG/ ammonia carriers and 2 passenger carriers. In addition, SCI also manages 58 vessels on behalf of ONGC, other government departments and SCI's joint venture companies for LNG transportation. At present, the company has on order 31 ships of 1.8 million deadweight tonnage at various shipyards in India and abroad.

What is synchronized trading?

Synchronized trading is a form of stock manipulation It when someone buys and sells the same stock around the same time in order in increase volume.


When Large quantities of shares are sold by the associates of the promoters of a stock through a set of brokers in NSE and BSE and these shares are bought by the associates at the same time through different set of brokers. It can be alleged that these trades are artificial and synchronized - there was close matching of buy and sell order time, order quantity and order prices. (paraphased from source below)

Why where the brokers warned?

It is a broker's duty to ensure that the broker is not a party to any market manipulation and that the market in which he operates is run on a health and non-manipulative basis. (from source below)

Source(s)http://www.sebi.gov.in/cmorder/jayanthilal.html

RBI moves to contain inflation without hurting growth

Barring the hike in Statutory Liquidity Ratio, the deposits that commercial banks are to park in government securities, the central bank left other key policy rates and ratios unchanged.

Although the one percentage point hike in SLR could suck up over Rs 30,000 crore from the system, the average SLR of banks is already at 27.6 per cent.

"As such the increase in SLR will not impact the liquidity position of the banking system and credit to the private sector," RBI Governor D Subbarao said, releasing the second quarterly review of the Monetary Policy.

Maintaining the easy credit flow to the private sector would help increase economic activity.

RBI retains economic growth projection to six per cent with upward bias for the current fiscal, while upping inflation estimate to 6.5 per cent with upward bias by March end from five per cent earlier.

"As always the Reserve Bank will endeavour to ensure price stability and anchor inflation expectations," the central bank said.

IDBI Bank Executive Director Sushil Munot said the signal is quite clear that RBI does not want to hurt growth, but wants to check inflation. It is nevertheless a signal of reversal of easy monetary policy.

The central bank kept repo-rate at which banks borrow from RBI in exchange of government bonds at 4.75 per cent, reverse-repo at which the apex bank accepts deposits from banks at 3.25 per cent and Cash Reserve Ratio (CRR), the portion of cash banks park with the Reserve Bank, at 5 per cent -- all unchanged.

Taking a cue from RBI's monetary policy stance, banks are unlikely to hike their auto, home and education loans in the near term.

However, credit flow to commercial real estate may be affected as the RBI raised the requirement for banks to keep the money aside while lending to this sector from 0.40 per cent to one per cent.

It means banks will have to keep Re one aside for every Rs 100 lent to commercial real estate against 40 paise now.

"In view of large increase in credit to commercial real estate sector over the last one year and the extent of restructured advances in the sector, it would be prudent to build cushion against likely non-performing assets," Subbarao said.

The GDP growth projection for FY'10 has been pegged at 6 per cent, same as earlier, assuming a modest decline in agriculture production and a faster recovery in industrial production," the RBI said.

On inflation, the RBI said, "the base effect, which resulted in negative WPI-inflation till August, is now expected to work in the reverse direction accentuated by high food prices."

Commercial real estate loans to get costlier

RBI has tightened the screws on bank lending to the real estate sector - a move that did not go down favourably with the stocks of real estate companies. The BSE realty index fell by over six per cent.

All the realty stocks ended in the red. Sensex stock, Unitech plunged 7.5 per cent to Rs 86 after toucing a low of Rs 84. DLF tumbled 6.5 per cent to Rs 402. Omaxe crashed 10 per cent to Rs 107. HDIL tanked 8.6 per cent to Rs 341. Ansal Infrastructure shed 8.5% to Rs 69. Parsvnath, Phoenix Mills, Peninsular Land, Ackruti City and Orbitco slumped 5-7 per cent each.

Last December, real estate developers heaved a sigh of relief when the RBI allowed restructuring of loans up to June 30, 2009 as a part of its stimulus package. Since then, all major companies rescheduled loans worth crores to avoid default. but now, the RBI has had a change of heart.

Today the RBI says, “In view of large increase in credit to the commercial real estate sector over the last one year and the extent of restructured advances, it would be prudent to build cushion against likely NPAs.”

The central bank has concerns on the ability of developers to repay loans even at a later date. So, the provisioning requirement for advances to the sector has been increased from its present 0.4 to 1 per cent. This means the interest cost for developers is set to increase. DLF and Unitech have an average interest cost of about 12 per cent which is set to rise to about 12.75 or 13 per cent.

Developers are yet to get clarity on whether this provisioning will increase on existing bank loans. In fact, in the past six months, very few fresh loans have been sanctioned to real estate companies. So the RBI is sending out a clear signal for banks to be cautious even before the cycle of fresh lending begins

Brokerages point out that RBI's move may trigger a second round of equity funding for listed players. Listed companies have lapped up more than Rs 13000 crore rupees via qualified institutional placements in the past seven months. Some of these funds have been directed towards working capital needs. What’s more, about $ 3 billion is waiting in the wings to be raised via the IPO route by six companies. But for unlisted companies, funding options may be far lesser. for consumers, this move seals all possibilities for a further dip in prices. In fact, it is all set to increase

Sarang Wadhawan, Managing Director, HDIL, said, “You have to understand that the sector was just recovering, this will definitely affect developers in a way that projects which were under execution. Now we will have to increase prices to compensate for this cost that will be incurred, at the same time, affordable housing segment will be hit because of this.”

Even as companies have clocked in good volume in sales over the past two quarters, it remains to be seen whether an imminent price increase will sustain the recent uptick in demand.

Tata Steel India Q2 net down 49.5 pct, lags forecast

MUMBAI, Oct 27 (Reuters) - Tata Steel Ltd (TISC.BO: Quote, Profile, Research), the world's No. 8 steel maker by output, on Tuesday reported a 49.5 percent fall in September quarter profit from its Indian operations, as prices tumbled on the back of the global economic crisis.

The company, which acquired Europe's second-largest steelmaker Corus in 2007, said standalone net profit fell to 9.03 billion rupees ($192 million) for the fiscal second quarter, from 17.88 billion reported a year earlier.

Net sales fell to 56.3 billion rupees from 67.3 billion.

A Reuters poll of 11 analysts had estimated a standalone net profit of 10.2 billion rupees on net sales of 60.67 billion rupees.

Tata Steel bought European steel maker Corus in 2007. The Indian operations account for about a quarter of the group's annual global capacity of 30 million tonnes.

Global steel production has tumbled this year, as demand from key industries such as construction and automotive shrank. But as macroeconomic data improves and inventories deplete, demand is gradually coming back, encouraging steelmakers to restart some idled capacity.

Shares in Tata Steel, valued at about $10.1 billion, fell as much 7.3 percent to 501.35. The shares rose 30.6 percent in the September quarter, outperforming the benchmark index that improved 18.2 percent. ($1=47 rupees) (Reporting by Prashant Mehra; Editing by Jarshad Kakkrakandy)

Kotak Mahindra net surges 86% to Rs 299 cr

Private sector lender Kotak Mahindra Bank today reported 86.22 per cent rise in its net profit at 299.76 crore for the second quarter ended September 30, 2009, over the same period last year.

Total income rose to Rs 2,312.91 crore in the latest quarter ended September 30, 2009, up 25.05 per cent from Rs 1,849.51 crore in the same period corresponding fiscal, Kotak Mahindra Bank said in a filing to the Bombay Stock Exchange(BSE).

On standalone basis, the bank reported a net profit of Rs 125.90 crore for the July-September quarter, jumped over two-folds to Rs 47.86 crore in the same period last fiscal.

Shares of Kotak Mahindra Bank were trading at Rs 764.10 on the BSE, down 2.18 per cent from its previous close.

Rupee ended down at a three-week low against the US dollar

Rupee ended down at a three-week low against the US dollar today because banks bought the greenback noting the decline in local share indices and also to meet importers' month-end dollar demand, dealers said.
The Indian unit ended at 46.9200 rupees compared with 46.6500 per dollar Monday. Rupee swayed in the 46.7700-47.0050 per dollar band intraday today.
"The fall in local shares today triggered some FII outflows today. There was no direct impact of the RBI policy on rupee. Intraday, rupee purely tracked local share," said a dealer with a large UK bank.
Today, the Bombay Stock Exchange's Sensex and the National Stock Exchange's Nifty ended down 2.31% and 2.50%, respectively, on disappointment over the Reserve Bank of India's mid-term monetary policy review for 2009-10
(Apr-Mar).
RBI kept the Repo, Reverse Repo, and Cash Reserve Ratio unchanged as per market expectations, Statutory Liquidity Ratio was hiked to 25%. Gross domestic product growth projection for 2009-10 (Apr-Mar) was kept unchanged
at 6.0% with an upside bias.
RBI also discontinued the refinance windows for banks and foreign exchange swap facility for banks today.
"It (foreign exchange swap facility) was a measure introduced last year when market faced the problem of dollar crunch. Not many banks used it. So it may not have an impact on the forex market," said S. Rajendran, general manager treasury, Union Bank of India.
"Importers were persistently buying dollars in the market today to meet their month-end needs that added to the fall and dragged rupee to the 47 level," said a dealer with a state-owned bank.
Banks also purchased the greenback noting its rise against other Asian currencies, dealers said.
Euro's fall below the $1.5000 mark in the overnight market also added to the Indian units' woes, dealers said.
However, dollar sales from exporters prevented a further decline in the Indian currency, dealers said.
"Exporters had to step in to sell dollars with rupee weakening to 47.00 today. Those exporters who had missed a chance to sell dollars in the past few days, sold it today," said a dealer with a US bank.
Bouts of profit booking also limited the slide in the Indian currency today, dealers said.

Mahindra Renault clarifies on 'Sandero' brand

Hyundai Motor India has taken Mahindra Renault to the Delhi High Court objecting to the latter's plan to launch a compact car in the country with the name 'Sandero' alleging that the rival was trying to cash in on its popular brand Santro with a similar sounding product. They (Mahindra Renault) are planning to launch Sandero, which is very similar sounding to our Santro. Both are hatchbacks and Santro is an established trademark and they are trying to get mileage out of it," a senior Hyundai Motor India (HMIL) official told PTI.

HMIL's plea requests the court not to allow Mahindra Renault to launch the car under the name Sandero, he added.

Neither a call made to Mahindra Renault Chief Executive Officer Nalin Mehta nor an e-mail sent to Mahindra & Mahindra group spokesperson seeking comments on the development got a reply.

'Santro' is HMIL's flagship brand and a total of over 15 lakh units have been sold both in the domestic and the overseas markets since its launch in September 1998.

On the other hand, Mahindra Renault has been struggling to mark its presence in the Indian car market with its sole product Logan failing miserably sparking speculations of a break-up of the joint venture between Mahindra & Mahindra and French auto major Renault.

Market analysts pointed out that the firm desperately needs another product to keep the JV alive.

GMR Energy drags Ministry of Power, REC, PFC to Delhi HC

GMR Energy has filed three petitions against the ministry of power and two PSUs — Rural Electrification Corporation and Power Finance Corporation — which had invited bids from the private sector to set up three transmission projects.

According to the petition, GMR Energy was disqualified on the ground that the formula for calculation of Internal Resource Generation (IRG), one of the criteria for qualification, was not correct.

In its petition filed through law firm Link Legal, GMR submitted before the court that it had sought an opinion from the Institute of Charted Accountants (ICAI) on the issue.

The ICAI said the formula adopted by it for calculation of IRG is correct and acceptable, and in fact, compliant with well-established accounting standards, GMR Energy submitted in the petition.

The company submitted that it was disqualified on a faulty criteria adopted for calculating the IRG and requested the court to stay the tendering process.

Admitting it, a division bench comprising Justice B D Ahmed and Justice Veena Birbal has issued notice to the Centre, REC and PFC directing them to file their replies.The court has listed the matter for next hearing in November.

Buy IDBI Bank, target of Rs 160: RR Financial Consultants

RR Financial Consultants has recommended a buy rating on IDBI Bank with a price target of Rs 160, in its report dated October 1, 2009. The share closed at Rs 125.00, down Rs 2.2, or 1.73%.

"As per other technical indicators, IDBI Bank is trading well above the crossover of 9 & 18 days WMA and 50 days SMA. This indicates the counter is bullish in medium to long term. 14 Days RSI is trading at Rs 73 level, with upward bias. But according to this the counter is already in over bought zone; therefore we may see some correction in prices in the near term. Overall the trend remains positive for the counter. So any dip in price levels from here will be taken as an opportunity to make fresh long position. It is taking strong support at Rs 105 level. Next target is placed at Rs 160," says RR Financial Consultants' report.

SBI has target of Rs 2400: Sukhani

SBI has target of Rs 2400, says Technical Analyst, Sudarshan Sukhani.

Sukhani told CNBC-TV18, "My top picks are primarily midcap PSU banks, that is Bank of India, Bank of Baroda and UCO Bank but that is just a matter of choice. The entire banking universe broadly suggests that outperformance in the times to come, so if you own SBI with you, you really don’t want to get out in a hurry, look for a target of somewhere around Rs 2,400. But you must keep a protective stop that would be somewhere at Rs 2,100 and if the markets and the stocks start slipping below that then you get out and otherwise wait patiently for your targets to come and that applies generally to most other banks.”

Transparency in Trade Details

This will help you in the following ways:

• Receive transaction statements daily
• Confirmation or Verification of trade will be faster with the trade details provided by your broker
• Enhance investment tracking and management of your portfolio
• Infuse transparency
• Build confidence

This initiative by the NSE Investor Protection Fund Trust will go miles to instill transparency and investor’s confidence. Good move in the interest of investors!

There is no such thing as a free gift!

If you are receiving gifts from your friends, there is a price tag attached – not from your friend but from the taxman!

From October 1, 2009, gifts received from non-relatives will be included in the taxable income of individuals and will be taxed at the normal tax bracket. Earlier, only cash gifts over Rs 50,000 were taxed as income in the hands of the recipient individual or HUF.

As per the amendment to provisions of Section 56(2) (vii) introduced by the Finance Act, 2009, the under-mentioned items will also be included in the income of the individual assessees and HUFs if they are received as a gift by them. The same will be brought to tax if the aggregate value of all gifts exceeds Rs. 50,000 in any previous year:

• Land and building
• Shares and securities
• Jewellery
• Archaeological collections
• Drawings
• Paintings
• Sculptures
• Any work of art

Additionally, if you are thrilled at negotiating a deal below the Fair Market Value (FMV), watch out for the tax axe from the Income-tax Assessing Officer (AO). If the purchase consideration is inadequate i.e. substantially lower than the FMV, then it will attract tax. The AO would take the FMV of such a purchase or the differential value of such a purchase, if it exceeds Rs 50,000.

However, provision for taxability of gifts shall NOT apply to any sum of money or any property received

• from any relatives or
• on the occasion of marriage or
• under a will or by way of inheritance

The term ‘relative’ will mean as defined under section 56 of the Income-tax Act, 1961 and not as understood under common parlance.

Further, if you receive any other valuables such as a motor car, electronics, furniture, etc. you will be saved from being taxed and you can continue to enjoy the luxury of receiving any of these gifts even beyond October, 2009.

We believe that such a fiscal measure by the government will bring in more assessees under the tax bracket. However, it would have been more appropriate if the government had a separate exemption limit for each category of asset in the list. For example, incase of land and building, the exemption limit of Rs 50,000 is meaningless; instead it could have been enhanced to say Rs 10 lakh.

Diwali comes early – for the person buying a house!

To brighten up the festive season, some banks have introduced attractive offers on their home and auto loans.

· State Bank of India is offering:

• Home loans of up to Rs 50 lakh at fixed interest rates of 8% p.a. for the 1^st year and 8.5% p.a. for the next 2 years

· IDBI is offering the following from the period October 1 to December 31, 2009:

• Auto loans at 8.5% p.a. (as compared to 12% p.a. previously)
• Home loans less than Rs 30 lakh at reduced floating rate of 8.75% p.a. (from 9% p.a.)
• Home loans between Rs 30 lakh-Rs 50 lakh at reduced floating rate of 9% p.a. (from 9.5% p.a.)
• Home loans above Rs 50 lakh at attractive floating rate of 9.25% p.a. (down from 9.5% p.a.)

· Bank of Rajasthan has slashed home loan rates in an offer valid till December 31, 2009:

• Fixed rate is reduced to 9% p.a. for the 1^st year, and 10% p.a. for the 2^nd and 3^rd year
• Floating rate is cut to 8% p.a. for the 1^st year and 9% p.a. for the 2^nd and 3^rd year

· Punjab National Bank is offering:

• Home loans upto Rs 30 lakh at 8.5% p.a. fixed rate, with a reset clause of 3 years. This offer is valid only till October 31, 2009

· Bank of India, under its Festival Offer valid till October 20, 2009 is offering:

• Home loans upto Rs 10 lakh at 8.5% p.a. for a repayment period of 3 years

Hurry, and make the most of these offers, while they last! However, ensure that you read all the fine print of these offers before subscribing to them.

Buying this hated asset could be the best trade in the market today

Despite continued discussions about fundamental USD weakness, and the fine job the government is doing devaluating our currency, I can't help seeing reasons to buy the USD.

My view does not rely on contradicting the thinking according to which excess liquidity and unbalanced budgets for the government and the consumer lead to weaker currency. But I think that the amount of currency being "retired" with debt not being rolled and the velocity being null is partly countering the excessive printing.

Also, one need also to keep in mind that when it comes to currencies all is relative, and while the Fed and the Treasury department are certainly not acting with a strong USD in mind these days, other countries have embarked on a similar path.

Last but certainly not least, almost everybody is short USD.

TAX HORROR: White House committee to propose national sales tax

From Zero Hedge:

The “Center for American Progress” is the best example of an oxymoronish name that I can think of. This is a “progressive” (socialist) “think tank” (another misleading term) lead by John Podesta, a former Clinton Chief of Staff and Obama adviser.

They are coming out with a report on Wednesday that will recommend that:

[T]he administration should consider a tax on consumption, such as a value-added tax [VAT] system similar to that in use in the European Union

Sale of Reliance Industries shares by RIL’s Petroleum Trust

In the last few days, newspapers are full of reports on the sale of RIL’s shares by Petroleum Trust managed by RIL.

Many experts have commented about the impact of the transaction. RIL has also issued a communication saying “the financial impact will be reflected in the consolidated statement of the company.”

The reality is that the RIL Group has raised Rs 3,188 crore of cash from the sale. Reports on various uses of the cash, including investment in a global acquisition, are doing the rounds.

A bit of understanding of the background and the relevant accounting standards will help the readers reach the right conclusion as to how the transaction will impact RIL’s results.

First and foremost the legal entity, which sold the shares, is Petroleum Trust, and not RIL. Reliance Industries Investments and Holdings Limited, a 100 per cent subsidiary of RIL, is the sole beneficiary of Petroleum Trust. Hence the transaction will not be reflected in the standalone accounts of RIL.

However, consolidated accounts of RIL will reflect the transaction. This is in line with the RIL’s communication issued in this regard.

Transfer of shares

This leads to the critical question of s the meaning of “will be reflected in the consolidated statement of the company.” The popular understanding is that the profit will be credited to the P&L account. Before jumping to this conclusion, let us look at the facts and the relevant accounting conventions. Let us first look at how the shares came into the possession of Petroleum Trust.

Prior to merger of the earlier Reliance Petroleum and IPCL, RIL transferred its shareholding in the merged companies to Petroleum Trust. On merger, Petroleum Trust received RIL shares as per the approved exchange ratio. The other option RIL had at the time of merger was to cancel these shares. If this option had been exercised , RIL’s share capital would have been lower to the extent of the face value of the shares issued to Petroleum Trust and reserves would have been higher by an equal amount. There would not have been any impact on the P&L account.

In consolidated accounts, there is no difference between the holding and its 100 per cent group companies. Logically, no company can generate profit by issue of its own shares.

Sale of treasury shares by the group company is equal to the issue of own shares at a premium. Hence, such transactions can’t impact the P&L account.

Accounting conventions

Let us look at the accounting convention relating to treasury stock. As per international practice, buybacks can create treasury stock. However, under the buyback regulations of India, companies are not allowed to create treasury stock through buyback.

So, let us look at the international accounting standard governing the treatment of profit or loss from the trading of treasury stock. As per IAS 32, treasury stock held on the balance-sheet date has to be deducted from the share capital. Any profit/loss on sale of treasury stock during the period has to be adjusted to reserves and cannot be reflected in the P&L account. In this context, it may be noted that RIL in the consolidated accounts for 2007-08 has not deducted the treasury stock held by Petroleum Trust but has given a note on this.

From the above, logically and also as per the accounting conventions, the profit from the sale of these shares will not form part of profit for the year. But there is no doubt that shareholders could stand to benefit from the use of the cash generated from the sale.

Fund houses try to lure investors with gold ETFs

Many mutual fund houses are planning to launch gold exchange traded funds (ETFs) to cash in on the buzz around gold.

At least four fund houses are planning to launch gold funds or gold ETFs. HDFC Mutual Fund and ICICI Prudential filed draft offer documents with SEBI in September. Religare Mutual Fund is expecting SEBI approval for its gold ETF. Principal PNB Mutual Fund is planning to apply to SEBI for a gold ETF to be launched in three months, said Mr Sudipto Roy, Business Head of Principal AMC.

Gold prices were at Rs 15,865/10 gm on Wednesday closing. According to a senior industry analyst, it is only the euphoria around gold that might be prompting fund houses to launch these gold ETFs as fundamentally one does not enter a market that might be in danger of peaking. “For example, in 2007, when the market was already at the peak, we saw a large number of equity funds being launched although it was not the right time to enter the market at such high peaks,” she explained.

Gold prices have been going up in the past few months and fund houses are looking at this as an opportune time to launch gold ETFs, said Mr Krishnan Sitaram, Head of Crisil Fund Services, CRISIL. This would not only complete the product suite of these fund houses but is also a way of tapping the current investor interest in gold, he added.

While there is a section of analysts who feel investors would stay away from investing in gold ETFs at this level, some, such as Ms Lakshmi Iyer, Head of Products of Kotak AMC, feel that there is a case for investors to enter even now as gold prices could increase further. “Maybe they could wait for price dips at some intervals and then invest,” said Ms Iyer.

However, some mutual fund houses are putting their gold plans on hold. Tata Mutual Fund that had plans for a Gold ETF has shelved them. “Gold has already touched a peak and now there is lack of appetite in the market. At this point of time it doesn’t seem appropriate to launch a gold ETF,” said a Tata Mutual Fund spokesperson.

Fresh inflows into the six existing gold ETF schemes were minimal this August, around Rs 16 crore, against Rs 45 crore in July, and Rs 34 crore in June. But the assets under management of these schemes have risen since June from Rs 844 crore to Rs 904 crore in August, largely due to the rise in gold prices.

(Source: The Hindu BusinessLine)

Housing prices may go down

Global property consultancy firm, Knight Frank India, has said that prices in the residential property segment are likely to decline in a short time.

"We feel prices of residential segment may go down over a period of time," Knight Frank India's chairman, Pranay Vakil, said.

The residential segment may see a robust demand in certain markets, he said, adding that it was also a good time for property developers to invest in land.

Demand for real estate at this stage is a combination of investor-led demand and end-user demand. While investor demand is due to shift in money from equity markets, end-user demand is due to increased consumer confidence and pent-up unmet demand from the recession period. This leads to a rapid increase in demand for real estate and a corresponding increase in property prices, he said.

Today, property buyers are worried that prices may go down further after they purchase the property and projects may not be completed on time, Vakil said.

Knight Frank launched a book titled Real Investment -- a real estate investment guide for India. The book seeks to lend a helping hand by covering all the information that one may require while investing in real estate.

The book compiles the perspectives of real estate industry experts to help deepen knowledge about real estate and consider it as an asset class.

Commenting on the book launch, Vakil said, as property advisors, we continuously work with some of the best minds in the sector. We felt the need for a single credible source of information for which we brought together the best minds in the business.

This book makes the seemingly daunting task of delving into the real estate market simpler by offering tips on how to make real estate a lucrative investment option."

Indian Vintner settles court case with Australian Vintage

Indage Vintners has settled the court case filed by the Australian Vintage by giving them Australian wine as compensation for not completing the deal to buy the Loxton winery and foregoing the initial deposit.

According to a report in Indian Wine Academy, under the settlement, Australian Vintage has received an amount that would be used towards purchase of wine from Thachi Wines in South Australia, owned by Indage. The wine is in addition to the USD six million non-refundable deposit previously paid to Australian Vintage by Indage for the Loxton acquisition. Australian Vintage has retained the Loxton winery and the suit has been withdrawn.

Indage had agreed to acquire the 90,000 tonne-capacity Loxton winery in South Australia from Australian Vintage for USD 60 million in March 2008. The sale was to be completed by September 2008 but was subsequently deferred until October, 2008 when Indage had said that it would be unable to complete the purchase of the winery at the designated time but it remained committed to the acquisition.

Uninor new brand name for Telenor-Unitech JV

Unitech Wireless and Norwegian telecom operator Telenor today announced that their mobile services in India will be named 'Uninor'"The announcement of the 'Uninor' name is a significant milestone in the roll-out of the operations in India as we move closer to the launch. Within the Telenor Group's existing markets, the Uninor brand will represent our vision and core values," Telenor Group President and Chief Executive Officer Jon Fredrik Baksaas said in a statement.

The 'Uninor' name will leverage from Telenor Group's established marketing and design framework, it added.

The new name is in line with Telenor's brand strategy in other markets like Bangladesh and Malaysia, where its mobile service is being marketed under a distinct regional brand.

Unitech Wireless has recently lined up a Rs 5,000 cr bridge finance with the State Bank of India, which includes bank gaurantees and a letter of credit that would help the company fund its 22 circle rollout.

Warren Buffett sitting on billions of paper profits

Warren Buffett has done it once again. Just like he has been doing it over and over again since the start of his career as a security analyst and money manager. 'Be greedy when other are fearful, and fearful when others are greedy' goes his simple homily. But simple doesn't necessarily mean easy, just like it wasn't easy to put your hard earned money in the stock market between September 2008 and March 2009. The markets were tanking almost everyday. Fear was everywhere, gripping everyone.

But not Warren Buffett. Buffett was busy. Busy being greedy that is. Some of his bigger buys during that period were US$ 230 m in BYD Co, a Chinese car and battery maker, and US$ 5 bn of preferred stock in Goldman Sachs along with another US$ 5 bn worth of warrants in the company. The Goldman investment has since generated a US$ 2 bn paper profit for Berkshire Hathaway.

The BYD investment too has been nothing short of a bonanza. In September 26 2008, Berkshire bought 225 m BYD shares at HK$ 8 each, then worth about US$ 230 mn in total. BYD shares closed at HK$ 42.9 this Friday, thus valuing Berkshire's stake at an eye popping US$ 1.25 bn now. Yes, value investing remains as alive and kicking as it was when Buffett started his career. And as you can see above, it can be immensely rewarding for the disciplined practitioner.

Airlines hold India to ransom

Aviation is a bewildering sector. It ranks among the finest achievements of human technical progress. It also ranks among the most difficult businesses to run profitably. Little wonder then, that in a bid to demand a bailout from the government, leading airline operators in India have called for a strike on August 18.

The pioneer of low cost airlines in India, Captain Gopinath calls the step a gimmick. He says, "The business magnates, Vijay Mallya or Naresh Goyal, know the reality: airport infrastructure is costly, oil prices are high. But they started a business and took a risk...The message to airlines is that there is lot of cost cutting they can do themselves."

He adds, "They got together as a cartel and fixed price by blaming fuel surcharge. That was the beginning of airlines’ woes - occupancy fell, collections came down and losses went up." We agree. Although the government needs to do much more in making the Indian aviation sector more viable, holding the public to ransom is hardly the way for businesses to negotiate terms.

In fact, on being asked what should the Government do if the airlines insisted on the strike, Gopinath said, "The Government can arrest airlines chiefs under the Essential Services Maintenance Act - if truckers can be arrested they can do the same thing here."

What are structured settlements and how to get them?

What are Structured Settlements?

When law suits are settled, damages may be awarded in a lump sum, or a series of payments. A settlement which is awarded in a series of payments over time is called a structured settlement. Structured settlements are generally created by using a third party intermediary to provide the financing.

How to Purchase Structured Settlements?

State and federal law may restrict the sale of structured settlements, and there are many legal complications that can arise.

Since you’ll be exchanging cash for the right to receive future payments, you’ll want to make sure that you are protected.

1. Work with an established broker.

2. Look for a structured settlement financing company who is a member of the National Structured Settlements Trade Association who also places settlements with private investors.

3. Get multiple quotes to ensure you get the best deal.

4. Retain an attorney to review the agreement to ensure your interests are protected.

Compete Detailed Instruction And Tips About Purchase Structured Settlements Links can be found on the side bars and at the bottom of this page.

Benefits of a Structured Settlements

One significant advantage of a structured settlement is tax avoidance. With appropriate set-up, a structured settlement may significantly reduce the plaintiff’s tax obligations as a result of the settlement, and may in some cases be tax-free.

A structured settlement can protect a plaintiff from having settlement funds dissipated, when they are necessary to pay for future care or needs. Sometimes a structured settlement can help protect a plaintiff from himself – some people simply aren’t good with money, or can’t say no to relatives who want to “share the wealth”, and even a large settlement can be rapidly exhausted.

Minors may benefit from a structured settlement as well, such as a settlement which provides for certain costs during their youth, an additional disbursement to pay for college or other educational expenses, and then one or more disbursements in adulthood.

An injured person who has long-term special needs may benefit from having periodic lump sums with which to purchase medical equipment or modified vehicles. In some situations, it will be better for a severely disabled plaintiff to set up a special needs trust, rather than entering into a lump sum or structured settlement.

Any plaintiff who is receiving, or expects to receive, Medicaid or other public assistance, or the guardian or conservator entering into a settlement on behalf of a disabled ward, should consult with a disabilities financial planner about their situation before choosing any particular settlement option or structure.