“Time is the friend of the wonderful company, the enemy of the mediocre”. It is the perfect time to recall this wonderful quote by Warren Buffett. Interpreting a fine thought itself is an art. A company which did wonderfully in a growing economy may well fall into bad times when…
Investing defensively can be hugely beneficial in uncertain times like the present. This would mean changing one’s risk choices and return expectations. This is hardly going to be easy. Historically, investors always played for the highest returns at all times. In a growing economy, this strategy seemed to work for…
Raising capital under extremely adverse circumstances is truly a great accomplishment. The bigger Indian corporations have shown remarkable chutzpah in raising big monies during the COVID crisis. These monies are largely being used to deleverage their bloated debt. Clearly, India’s big businesses see leverage as a grave risk and are…
The US markets are now leading the global market sentiment. Indian markets seem to be fully coupled with what goes on there. Our markets are taking continuous cues from the Dow and Nasdaq. Investors are fashioning their decisions on US market moves and their index futures. As the battle against…
On Friday, the released US jobs data was a huge positive surprise. This coupled with a weakening dollar gave the stock market its perfect fuel cocktail. Risk-averse investors who were holding back seem to be taken by surprise. The surprise factor can instil much-needed confidence and calm nerves in global…
The markets are at peak polarization on valuations. We have an extremely expensive part and a very inexpensive part. There is no middle to this market. This gap will not sustain for too long. In a de-growing economy, earnings will be unable to guide investors in decision making. Most good…
The RBI delivered on the government’s announcements. Another rate cut extended moratoriums on loans until August 31st, and changed credit exposure limits to large business groups, sound a clear pro-growth message. This is good news at a time when the GDP growth outlook is negative, urban stress seems to be…
The signals from the stimulus are crystal clear. It is more monetary than fiscal. Clearly, the government is trying to bet on the entrepreneurs, self-employed, farmers, rural industries, and local businesses. This seems increasingly like a Bharat driven economic recovery of India. More money will flow into rural Bharat than…
It was a very busy week on Deal street. Reliance came up with two back to back private equity deals for its telecom venture JIO platforms. GlaxoSmithKline PLC managed to exit its entire equity stake in HUL in one go. These deals clearly tell us that the appetite for Indian…
The good news from India’s big business triggered the stock market bounce. A swift, big capital raise will follow this good news. In the near-term, this is going to be the story of our markets. India’s big business has been under-capitalised. Companies already are brimming with debt. Now, even near…
Naturally, equity investors think that a crisis in debt funds will not affect them. They tend to see equity and debt as if they were two asset classes that exist in distinct silos. But, the reality is very different. Every equity market crash always had a distinct debt market connect.…
An economy going through a phase of total shutdown for nearly two months is almost unheard of. We never wrote that scenario into our future strategies. We did not have a clear idea of how the second-order consequences would pan out. What happens when the whole world shut down for…
