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TCS may touch Rs 1900-2000: Sanjeev Agarwal

Written By Unknown on Jumat, 19 Juli 2013 | 18.01

Jul 19, 2013, 04.13 PM IST

Sanjeev Agarwal, CEO of Dynamix Research & Capital Management feels that Tata Consultancy Services (TCS) reach Rs 1,900-2,000 in the next six months. "If the stock pulls back towards Rs 1,600-1,650 one can buy it," he adds.

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TCS may touch Rs 1900-2000: Sanjeev Agarwal

Sanjeev Agarwal, CEO of Dynamix Research & Capital Management feels that Tata Consultancy Services (TCS) reach Rs 1,900-2,000 in the next six months. "If the stock pulls back towards Rs 1,600-1,650 one can buy it," he adds.

Like this story, share it with millions of investors on M3

TCS may touch Rs 1900-2000: Sanjeev Agarwal

Sanjeev Agarwal, CEO of Dynamix Research & Capital Management feels that Tata Consultancy Services (TCS) reach Rs 1,900-2,000 in the next six months. "If the stock pulls back towards Rs 1,600-1,650 one can buy it," he adds.

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Sanjeev Agarwal, CEO of Dynamix Research & Capital Management told CNBC-TV18, "We have been recommending Tata Consultancy Services (TCS) or any IT stock because we had seen that dollar is going to be very strong and only the first leg has played out till now. Actually this last move which was strong had culminated because we had seen a fifth way failure in dollar."

"All these IT stocks look very good, in terms of their revenues and they are going to benefit hugely. TCS has given a breakout above Rs 1,650 so any pullback towards Rs 1,600-1,650 will be a good buying point because I see that it may reach around Rs 1,900-2,000 very easily in next six months," Agarwal said.


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Will review rate-cut decision in next 7-8 days: OBC

Despite the announcement on July 10 to cut base rates with effect from July 22, the decision was deferred due to changes in short-term rates caused by market volatility, says SL Bansal, CMD, Oriental Bank of Commerce (OBC).

Also Read: RBI opens new attack to clamp rupee free fall

In an interview to CNBC-TV18, Bansal adds that the decision to cut base rates will be reviewed after a seven or eight days and says that the bank's liquidity is at comfortable levels.

Below is an edited transcript of the interview on CNBC-TV18

Q: Can you explain why the Oriental Bank of Commerce (OBC) has deferred the decision to effect a cut of 25 bps in its base rate ?

A: Despite our announcement on July 10 to cut our base rate with effect from July 22, the decision was deferred due to changes in short-term rates caused by market volatility. The decision will be reviewed after seven or eight days.

Q: Do you think some of these rates, including deposit rates and maturities will move higher?

A: Not yet. To date, liquidity is at comfortable levels as far as Oriental Bank of Commerce is concerned and fortunately, there is not much credit offtake. So, I don't foresee any requirement for raising deposit rates.

Q: Is the economy in for lower rates going forward?

A: The situation is fluid. The RBI has promised that its measures were only temporary till stability returns.

Q: Have your costs gone up because of RBI's measures over the last few days?

A: Costs have not gone up and the measures that we are implementing are purely precautionary in nature. After the RBI's announcements three days ago, CD rates suddenly moved from 8.5 to 10 percent to settle at the current level of around 9.25 percent. So, we are constantly monitoring the situation.

Q: Will you reconsider your decision to cut the deposit rates, on very high deposits,  which amounted to over Rs 5 crore?

A: This cut of Rs 5 crore and above in deposit rates is part of a regular process that is reviewed daily. The planned 25-bps cut does not affect costs much and is move purely to manage liquidity

Q: Do you expect call rates to stabilise around 9 percent?

A: It depends on how long the RBI's current measures will be in force. If the measures are in force for a few months, the call rates will stabilise at 9 percent. If market volatility and the rupee stabilise, the RBI will bring these measures to a halt and then call rates will naturally fall.



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MCX Silvermic November contract trades lower


At 15:51 hrs MCX SILVERMIC August contract was trading at Rs 40377 down Rs 121, or 0.30 percent. The SILVERMIC rate touched an intraday high of Rs 40755 and an intraday low of Rs 40218. So far 30190 contracts have been traded. SILVERMIC prices have moved down Rs 16824, or 29.41 percent in the August series so far.

MCX SILVERMIC November contract was trading at Rs 41200 down Rs 124, or 0.30 percent. The SILVERMIC rate touched an intraday high of Rs 41569 and an intraday low of Rs 41074. So far 2124 contracts have been traded. SILVERMIC prices have moved down Rs 4803, or 10.44 percent in the November series so far.

MCX SILVERMIC February contract was trading at Rs 41990 up Rs 5, or 0.01 percent. The SILVERMIC rate touched an intraday high of Rs 42398 and an intraday low of Rs 41820. So far 26 contracts have been traded. SILVERMIC prices have moved down Rs 10, or 0.02 percent in the February series so far.



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MCX Goldm September contract trades flat

At 15:48 hrs MCX GOLDM August contract was trading at Rs 26709 up Rs 18, or 0.07 percent. The GOLDM rate touched an intraday high of Rs 26827 and an intraday low of Rs 26676. So far 13745 contracts have been traded. GOLDM prices have moved down Rs 641, or 2.34 percent in the August series so far.

MCX GOLDM September contract was trading at Rs 26700 up Rs 20, or 0.07 percent. The GOLDM rate touched an intraday high of Rs 26810 and an intraday low of Rs 26674. So far 2379 contracts have been traded. GOLDM prices have moved down Rs 1024, or 3.69 percent in the September series so far.

MCX GOLDM October contract was trading at Rs 26792 up Rs 52, or 0.19 percent. The GOLDM rate touched an intraday high of Rs 26893 and an intraday low of Rs 26759. So far 1259 contracts have been traded. GOLDM prices have moved up Rs 732, or 2.81 percent in the October series so far.



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Sensex back above 20K, at 1-1/2 mth high; telecom, banks up

Written By Unknown on Senin, 15 Juli 2013 | 18.00

16:07

Moneycontrol Bureau
Indian stocks gained for the third consecutive session Monday with the BSE Sensex reclaiming the 20000-mark for the first time since May 30. Better-than-expected monthly inflation and positive global cues helped the market.

The 30-share Sensex rose 76.01 points to close at 20034.48, and the 50-share Nifty gained 21.80 points to end at 6030.80, but the broader markets outperformed benchmarks.

The BSE Midcap Index advanced 0.9 percent and Smallcap climbed 0.8 percent. Advancing shares outpaced declining ones by 1341 to 958 on the BSE.

Amit Dalal of Tata Investment Corporation says the market can not blowout of the range which has been created now for almost six months. So, one should not expect substantially more up moves from the market, but July is definitely a better month than the month of June, he adds.

Wholesale Price Index inflation increased marginally to 4.86 percent in June from 4.7 percent in previous month, but that was higher-than-forecast of 5 percent .

Anand Rathi says a sharp jump in prices of food articles led to marginal pick up in the WPI inflation. However, impact of a 10 percent fall in rupee is yet to be factored in WPI inflation in coming months, the brokerage house adds.

"Nevertheless, due to weak pricing power of the manufactures, the impact of rupee depreciation is likely to be around 30-50bps on the overall WPI inflation. We expect RBI to maintain status quo in the July 2013 policy," Anand Rathi says.



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Here's how banks violated RBI norms on KYC

Moneycontrol Bureau

Banks got a rebuff from the Reserve Bank of India (RBI). The central bank on Monday imposed nearly Rs 50 crore fines on 22 banks while warning seven other banks for violating Know Your Customer (KYC) or Anti-Money Laundering (ALM).

Must read: RBI fines 22 banks, warns 7 for KYC violations

It is noteworthy that Cobrapost.com, an online investigative magazine had carried out a series of sting operations on Indian banks. It had alleged of wide-spread infringement of KYC and ALM norms. Based on those allegations, the central bank formed an investigation committee and carried out a scrutiny among alleged lenders. Outcomes of the investigation actually prompted the RBI to act with (monetary) punishment measures.

Here's what it reveals:


  • Non-adherence to certain aspects of know your customer (KYC) norms and anti money laundering (AML) guidelines like customer identification procedure, risk categorisation, periodical review of risk profiling of account holders, periodical KYC updation;
  • Non-adherence of KYC for walk in customers including for sale of third party products, omission in filing of cash transaction reports (CTRs) in respect of some cash transactions, sale of gold coins for cash beyond ` 50,000;
  • Non-adherence to instructions on monitoring of transactions in customer accounts;
  • Non-adherence to instructions on classification of accounts as 'in-operative'/dormant and lapses in monitoring of transactions in dormant accounts;
  • Non-adherence to instructions which prohibits acceptance of cash above ` 50,000 from customers for sale of gold coins and issue of Demand Drafts, etc.;
  • Non-adherence to instructions on the upper limit for remittances under Liberalised Remittance Scheme, upper limit for repatriation of funds from non resident ordinary (NRO) accounts;
  • Non-adherence to instructions on import of gold on consignment basis.
Based on the findings of the scrutiny, the Reserve Bank issued a show cause notice to each of these banks, in response to which the individual banks submitted written replies. After considering the facts of each case and individual bank's reply, as also, personal submissions, information submitted and documents furnished, the Reserve Bank came to the conclusion that some of the violations were substantiated and warranted imposition of monetary penalty, RBI said in a release on Monday.
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Survival in volatile market is challenge: Gammon Infra

Moneycontrol Bureau

Amid high interest rates, sluggish pace of orders and absence of big ticket projects, infra companies are finding it difficult to sustain margins. In such circumstances, one has to get its survival instincts right before targeting growth plan, believes, KK Mohanty, managing director Gammon Infra Project Ltd .

"We are treading cautiously and are not so aggressive in monetising assets. Our primary agenda is to sustain and grow order book along with timely execution of existing projects," said Mohanty in an interview to moneycontrol.com.

Mohanty agrees that infra sector is struggling amid a slump in economic growth, which has fallen to a decade-low as companies have put fresh investments on hold.

Read This: Gammon India expects CDR nod soon; interest burden to ease


Companies have stalled projects due to either cash crunch or due to delay in regulatory approvals prompting them to stall atleast 200 projects in the past one and a half years.

"Firms are confronted with high borrowing cost which is straining balance sheets," added Mohanty.

The above mentioned factors are not in one's control, Hence one has to do a balancing act, he believes.

In previous year, the firm completed three projects and we have also shown growth on the top-line, and we moved from an Rs 25 crore loss to an Rs 15 crore profit at the bottom-line. We are keen to put three more projects into operation in FY14, he said.

The company is towards completion of its Godavari Bridge, Patna-Hajipur Highway and one of the power project.

Analysts have also maintained a cautious stance on the sector overall. Despite the government easing policy decision and fast-track clearances for several projects, the upcoming scheduled elections in the next 15 months could delay reforms.

Brokerages also anticipate an around 40 percent decline in collective order book of infra companies in the June quarter.

Gammon Infra has declined over 29 percent in the past one year to Rs 9.05 on fundamental issues overall. However, the firm is on the prowl for new projects but will be little cautious due to volatile market conditions, Mohanty said.

shaheen.mansuri@network18online.com



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A fine blend of leadership styles

By Mohinish Sinha

Most of you would agree with me when I say that good leadership has the power to energize, engage, and motivate team members to go 'the extra mile' for their organization. However, while good leadership is synonymous with flexibly tailoring the leadership style to suit the situation, a rather more modest outlook awaits within the results of Hay Group's latest research - globally, only a quarter (26 per cent) of leaders are able to adopt a range of four or more leadership styles. In comparison, one third (36 per cent) of leaders have mastered none or only one leadership style!

In my previous post, I have written about the 'coercive' and 'affiliative' leadership styles. This time around, I hope to share my experiences in the 'authoritative' and 'coaching' leadership styles.

The 'authoritative' leadership style, dominant amongst North American leaders (47 per cent), is focused on communicating the long-term direction, purpose and vision, and ensuring that everyone is motivated and working towards the 'big picture'. Authoritative leaders win people over by convincing them that they want to do the job. They also give feedback to people on how they are doing relative to their goals, creating a positive climate that elicits the best from the team.

If you've ever had an authoritative manager, you, as a team member would understand what you need to do, how you need to do it, and why your role is important to the overall objective - all of which contributes to creating a high performance climate for the team! Of course, this style is most impactful when used regularly, but in a subtle way. It is most effective when a new vision or clear direction is needed, and is particularly valuable when a team is new or looking to its manager for expert guidance. Since it helps to motivate people, it is also a good choice when day-to-day tasks are difficult or unpopular.

But if 'authoritative' is your dominant leadership style, I'd advise you to hold back on this style approach when managing an experienced team who know as much - or even more - than you. This style can be counter-productive when trying to develop self-managed work teams, or involve employees in the decision-making process.

I now turn to the 'coaching' leadership style - which Hay Group's research found to be the most dominant leadership style ((81 per cent) in the most high-performing Asian organizations. We find that a coaching leader invests the time to understand individuals' strengths and weaknesses, and works with them to achieve their personal development goals. He / she delegates assignments based on who will learn most from the experience, not necessarily who is best for the job. The leader focuses on building long-term capability, even at the expense of short-term performance!

Clearly, this style, characterized by pushing team members to be the best they can be, works well closer home. The best use is when managing a group of motivated people with a clear sense of aspiration and a willingness to work towards long-term career goals. The style is also useful when encouraging individuals to innovate, show initiative and take calculated risks; since it helps team members to find their own solutions to work problems.

However, in a crisis situation, steer away from 'coaching' - it can do more harm than good; a crisis is a time when the team needs explicit direction, or when a team lacks information or experience. And if a leader is too focused on individual aspirations, the needs of the organization can be neglected. This style also has little effect when dealing with performance issues.

Have you worked with a 'coaching' or 'authoritative' leader? When, in your experience, do these leadership styles work best?

Mohinish Sinha is the Leadership and Talent practice leader, Hay Group India

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You can send your feedback on smementor@moneycontrol.com or simply post comments below



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India Ratings negative on retail sector for H213

Written By Unknown on Jumat, 12 Juli 2013 | 18.01

India Ratings & Research (Ind-Ra) has maintained a negative outlook on the retail sector for H213. The expected continuation of negative real wage growth and weakening of household finances may further pressurise consumer spending in the next six to 12 months.

While retailers are streamlining operations to reduce costs, the continuation of discounts is expected to drive down margins.

On the capex front, the retailers are looking at profitable and moderate pace of additions (under 10 percent) in FY14 as against the range of 15 percent-30 percent seen in the last two-three years. The agency expects this pace of additions to be maintained to help reduce major capex outgo. Lately, companies are closing, relocating or rationalising unprofitable stores.

Hurdles in attracting foreign direct investment (FDI) in multi-brand retail have increased. Recent instances of alleged questionable practises, under the existing Foreign Corrupt Practises Act, may further increase the challenge of attracting FDI in sectors such as retail. Foreign investors may additionally face a regulatory or reputation risk in their home jurisdictions.

Ind-Ra expects estimated lower operating profitability, higher funding costs and working-capital requirements to continue to exert pressure on operating cash flows. In FY14, even though capex is expected to be lower, meaningful deleveraging is unlikely to occur. While some players may resort to asset sales to reduce absolute debt levels, the commensurate reduction in cash flows from these assets, may provide limited, if any, benefit to credit profile.

A sustained reduction in CPI, coupled with healthy kharif productivity may benefit consumer spending in Q414. Alternately, a sudden spurt in government spending may have a temporary beneficial impact on private consumption, ultimately benefitting the sector. However, companies which may successfully be able to attract equity investors, so as to deleverage their balance sheet significantly are likely to improve their credit profile.

Ind-Ra-rated retailers are Future Retail Limited ('IND A-'/Stable), Future Value Retail Limited ('IND A-'/Stable), Shoppers Stop Limited ('IND A1'), Tristar Retail Limited ('IND BB-'/Stable) and Blues Clothing Company Limited ('IND BB+'/Stable).

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.



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India to sell retail inflation-indexed bonds via IDBI Bank

IDBI Bank Ltd is set to sell previously issued inflation-indexed government bonds to retail investors, a senior executive at the lender said on Friday.

The government has already raised 20 billion rupees from inflation-indexed bonds (ILBs) via two auctions conducted by the Reserve Bank of India in early and late June, and has been keen to make sure these so-called linkers can be sold on to retail investors.

Also read: May IIP seen at 1.5%; CPI at 9.2%: CNBC-TV18 Poll

India launched ILBs earlier this year to provide investors with an alternative to gold as a hedge against inflation.

Retail investors will be allowed to buy up to 2.5 million rupees of Indian government inflation-linked bonds, with a minimum face value at 10,000 rupees and additional increments of 10,000 rupees, said Melwyn Rego, executive director and head of IDBI's international banking business.

The price of the bond sale will be based on wholesale price inflation, he said.



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