Earning My Money

Binary Options - A Secure Investment for the Future

2014-03-18T18:34:00.002-07:00

The forex market has caught a lot of attention in past couple of years. Maybe because the promises seen on the sales pages of forex brokers and vendors seem to point to it as a way of easy money. However, because this market has some peculiarities which traders must be thoroughly at home with, many unprepared traders have seen themselves at the wrong end of the market. Investments vary in degrees and conditions. Some people will only invest with reputable institutions in order to reduce risk. With the use of popular online Search Engines, one is able to look around and search for the options that best fit them. On the flip side; with Search Engine Optimization, financial institutions (and other entities that perpetrate as such) can now search for customers who want what those institutions have. Bitcoin is what some online investors have been using since its creation in 2009. With that and the introduction of binary options, some investors consider these crypto and cyber currencies as a litmus test of how the "normal" (or legal) markets are doing; while some have yet to approve the entire scene all together. Pros and cons of Binary Options One advantage of binary options is that payouts are higher, fixed and known to you before you begin trading. Another significant benefit is that you can earn money regardless of the magnitude of the price change in the stock, commodity or index you chose. The binary options market allows traders to trade financial instruments spread across the currency and commodity markets as well as indices and bonds. This flexibility is unparalleled, and gives traders with the knowledge of how to trade these markets, a one-stop shop to trade all these instruments. Bitcoin, on the other hand, is no more arbitrary than derivatives or credit default swaps. Given that regular folks (if they're nerdy and interested in Bitcoin) can use the currency for all manner of things, including illegal things; it's arguably a far less arbitrary instrument. The major drawback of high-low binary options is that the reward is always less than the risk. This means a trader must be right a high percentage of the time to cover losses. While payout and risk will fluctuate from broker to broker and instrument to instrument, one thing remains constant: Losing trades will cost the trader more than she/he can make on winning trades. Other types of binary options (not high-low) may provide payouts where the reward is potentially greater than the risk. Final Verdict For those investors who are looking to invest over a long period of time, binary options may not be the best facility for this. At the heart of binary options, is its ability to provide fast turnarounds to investors. In a number of binary options platforms, there are longer term investments that are available but other traditional investment options which are tailored to long-term results are more suited to meet these financial needs. Also binary options cannot typically be executed before the expiration time while traditional options can be executed any time before the expiration time. Keeping this in mind can help investors understand how the payout is calculated and which timeframe they should be monitoring for their investment. If one were able to ensure digital security of intangible assets, then Bitcoin would be the investment for the longer term. The price of this crypto-currency and many like it have been all increasing exponentially. I would think about a portfolio that includes both Bitcoin as well as Binary Options. This can supplement current stocks, bonds, forex, and precious metals portfolio and be managed by an Information Technology specialist. Trading binary options is a choice that helps to develop and complement a financial strategy. Trying out this method of investing can lead to simple, profitable and fast returns for the global investor.

Follow the Rules or the Principles: US Conversion to IFRS

2012-07-28T05:20:00.001-07:00

External reporting is an important part of a public company's duties to the public. These reports largely effect the perception of the company's economic strength. As such, it is important that they are prepared faithfully. To do so, these external reports are governed by the US's current rules-based GAAP. Globally, public companies are most likely using International Financial Reporting Standards, either as a required or an acceptable standard for reporting. There is currently a push to have the US use the same system. While the decision is slow to be made, it warrants a look at what the US convergence with the principles-based IFRS, away from the current rules-based system used today, might bring.
With many systems and classifications, it is not always easy to pin down the right approach to accounting for a transaction. It is almost necessary for there to be multiple reporting methods. For example, there is no one method of valuating inventory that is superior to the others in all industries. Different needs have to be met, so rules are put into place to allow multiple approaches. Those vested in seeing the company succeed might think that the company should use whichever acceptable method reflects the company standing in the best light as possible each year. Changing methods each period can help the perception of the company's health, but it is not in the best interest of those using the created documents. Doing this would make period to period or even industry comparisons difficult or impossible. It makes sense, then, that rules have been put into place to help prevent such presentations of information.
These rules are generally a firm and concrete method of reporting. This does, however, allow a company to target certain areas for favorable classifications, by following the form of the law, but not necessarily the function. In many ways, rules-based accounting can allow for skirting the line of legality. An example would be in area of accounting for leases. Under the current system, leases are classified as capital leases if they are leased for 75% or more of the economic life of the asset, or the present value of the minimum payments are 90% or more of its fair value. There are many advantages to having a lease classified as operating lease over capital lease. The desire to influence classification has created the practice of entering leases for 74% of the asset's life for 89% of its fair value. Without the rule, companies would enter leases under terms that are not substantially different from purchasing the asset, yet taking full benefit of the advantages of a lease. The rule in place helps minimize the advantage of receiving both benefits.
The advantages of the rules-based system do not end there. However close they are to line, so long as they operate within the rules, they are safe from litigation. The switch to the principles-based IFRS removes such security for the company and its accountants. Classifications will be made not from predetermined criteria, but by active decisions and professional judgment. This opens them up to scrutiny, and may be the focus of a lawsuit. Further, the accountants themselves could potentially be targeted should their decisions be questioned. Companies stand to lose both a powerful tool and a level of legal security in the switch.
The switch to IFRS may help increase the integrity of the documents created by the accountants. Classifications will be made by seeing the substance of the transaction, not by the individual details. The decisions made will be based on professional judgments based on a simpler set of principles, over a long checklist of items. This flexibility allows for the more relevant information to produce a more robust report on the situation. While there is a greater possibility of a difference in judgments, there are fewer opportunities for overt manipulation.
The US convergence to IFRS is going to play a role in the years to come. Though the decision is being postponed here, IFRS continues to be used around the world. The timeline for convergence seems to be stretching farther than the initial forecast of 2014. The current rules-based system has its flaws of unclosed loopholes and inflexible reporting, but there are those who prefer it to the principles-based system, where two different reports could be prepared from the same data, based on the perceptions of those reporting.

Follow the Rules or the Principles: US Conversion to IFRS

2012-07-28T05:10:00.001-07:00

External reporting is an important part of a public company's duties to the public. These reports largely effect the perception of the company's economic strength. As such, it is important that they are prepared faithfully. To do so, these external reports are governed by the US's current rules-based GAAP. Globally, public companies are most likely using International Financial Reporting Standards, either as a required or an acceptable standard for reporting. There is currently a push to have the US use the same system. While the decision is slow to be made, it warrants a look at what the US convergence with the principles-based IFRS, away from the current rules-based system used today, might bring.
With many systems and classifications, it is not always easy to pin down the right approach to accounting for a transaction. It is almost necessary for there to be multiple reporting methods. For example, there is no one method of valuating inventory that is superior to the others in all industries. Different needs have to be met, so rules are put into place to allow multiple approaches. Those vested in seeing the company succeed might think that the company should use whichever acceptable method reflects the company standing in the best light as possible each year. Changing methods each period can help the perception of the company's health, but it is not in the best interest of those using the created documents. Doing this would make period to period or even industry comparisons difficult or impossible. It makes sense, then, that rules have been put into place to help prevent such presentations of information.

These rules are generally a firm and concrete method of reporting. This does, however, allow a company to target certain areas for favorable classifications, by following the form of the law, but not necessarily the function. In many ways, rules-based accounting can allow for skirting the line of legality. An example would be in area of accounting for leases. Under the current system, leases are classified as capital leases if they are leased for 75% or more of the economic life of the asset, or the present value of the minimum payments are 90% or more of its fair value. There are many advantages to having a lease classified as operating lease over capital lease. The desire to influence classification has created the practice of entering leases for 74% of the asset's life for 89% of its fair value. Without the rule, companies would enter leases under terms that are not substantially different from purchasing the asset, yet taking full benefit of the advantages of a lease. The rule in place helps minimize the advantage of receiving both benefits.
The advantages of the rules-based system do not end there. However close they are to line, so long as they operate within the rules, they are safe from litigation. The switch to the principles-based IFRS removes such security for the company and its accountants. Classifications will be made not from predetermined criteria, but by active decisions and professional judgment. This opens them up to scrutiny, and may be the focus of a lawsuit. Further, the accountants themselves could potentially be targeted should their decisions be questioned. Companies stand to lose both a powerful tool and a level of legal security in the switch.
The switch to IFRS may help increase the integrity of the documents created by the accountants. Classifications will be made by seeing the substance of the transaction, not by the individual details. The decisions made will be based on professional judgments based on a simpler set of principles, over a long checklist of items. This flexibility allows for the more relevant information to produce a more robust report on the situation. While there is a greater possibility of a difference in judgments, there are fewer opportunities for overt manipulation.
The US convergence to IFRS is going to play a role in the years to come. Though the decision is being postponed here, IFRS continues to be used around the world. The timeline for convergence seems to be stretching farther than the initial forecast of 2014. The current rules-based system has its flaws of unclosed loopholes and inflexible reporting, but there are those who prefer it to the principles-based system, where two different reports could be prepared from the same data, based on the perceptions of those reporting.

Money Management Is An Important Key For Good Life Management

2012-07-28T05:09:00.001-07:00

There is no better time to get your personal finances in order than right now. This article will give you some great ideas for better financial management. Do not spend your money on expensive classes or seminars; adopt the right habits and then develop a good common sense approach to finances. Anytime you can learn something it does help.

You're not alone if you make a mistake or two with your personal finances. If you mistakenly overdraft your bank account, you can request a waiver of the fee that is charged. This is for someone with a consistent record that avoids overdraft, retains balances, and will most likely only work once.

Make sure you designate a particular time each month for bill paying. While the entire day isn't needed to pay bills, having a day specifically for it is helpful. Mark it on the calendar and cling to it with fervor. Missing this day can cause a domino effect.

Most new products already come with a 90 day or one year warranty, and if your item is going to mess-up, it probably will within that time frame. Extended warranties only serve to profit the company you bought them from.

Be sure that you have both a debit card and cash in your wallet to take care of small purchases. Your credit card should not be your only mean of payment. Using credit cards for all of your purchases can get you into a lot of financial difficulties, so use debit cards or cash for most of your purchases.

You can buy many foods in bulk and save money. Protein may be bought as a half side of beef which you place in the freezer, or large quantities of poultry or fish that are frozen and individually wrapped. Buying in bulk is always cheaper when you are going to use everything you purchased. Take some time out of one day and cook the whole batch of meat and make your meals for the week so that you time and money.

If you tend to live paycheck to paycheck, it may be wise to seek overdraft coverage from your financial institution. You might be charged a little every month but you will save money on overdraft fees!

When trading internationally, let your stocks sit while they turn a profit. Be careful not to let them run too much, however, as this can be a risky strategy. When you have reached a certain profit goal, know when to say "enough" and end your trading session for the day.

Try out the local store brand in grocery shopping instead of a large well known brand. The larger brands spend a significant amount of money on advertising which goes straight into the cost of the product. Pick the generic option instead, which is always cheaper. There really isn't much difference in the quality, performance or taste of a generic brand.

Try to negotiate with debt collectors who are trying to get you to make payments. They probably bought your debt off for a very low price. Even if you only pay 50% of your balance, they will make money. Use this knowledge to your advantage to avoid paying debts in full.

Try seeking out non-essential areas on your expenditures and cut back on them if you notice you have no money left after paying your expenditures. One of the ways you can save money is by not eating out at restaurants. On the other hand, if you reduce the number of times you dine out by half, you will still be able to enjoy eating in a restaurant, and you will save money!

One way to help protect your budget is to enroll in overdraft protection through your financial institution. Although you may have to pay a little extra each month, the fee for overdrafting could be as much as $20.

Don't make the common mistake of spending your hard-earned money on lottery tickets. A better option is to put that money into a savings account or bank checks accounts. This guarantees you increased income over a period of time, instead of just throwing away your money.

Financial issues may pop up during the years, even when everything is planned out. You should find out now what fees and penalties you will face for late or missed payments, so you can prepare for the worst. Read your lease in full before signing it to ensure that you are not surprised by something later on.

A good month ahead should be a cue to save, not spend. Avoid this by sticking to your strict budget and never allowing your personal finances to suffer again.

Staying on top of your finances will allow you to save money on overdraft fees and late fees. Monitoring your own finances, instead of depending upon the bank to keep track, can give you a feeling of pride and help you better manage your finances.

SBT FY12 profit slumps to Rs 510.46 cr

2012-04-30T00:46:00.000-07:00

hiruvananthapuram: The net profit of State Bank of Travancore (SBT), an associate of SBI, fell to Rs 510.46 crore in 2011-12 against Rs 727.73 crore in the previous year.
The bank, however, registered a growth of 6.19 per cent in operating profit at Rs 1,249 crore against Rs 1,176 crore last year.
The fall in net profit attributed to various factors like additional provisions for staff, NPA and income tax payment, the bank said.
The total income of the Kerala-based bank improved by 29 per cent to Rs 7,477 crore from Rs 5,819 crore in the previous year, SBT Managing Director P Nanda Kumaran and other senior managers told a press meet here last evening.
Elaborating on the bank's performance on various fronts, bank officials said "our overall performance has been much better compared to many other banks in the country during the period".
Total business registered a growth of 21.69 per cent at Rs 1,26,816...

DHANANJAY

- PGDM

Yes Bank eyes Rs 1.5 tn balance sheet size

2012-04-30T00:38:00.000-07:00

Mumbai: The youngest private sector lender Yes Bank has set a target of achieving a balance sheet size of Rs 1.5 trillion by the turn of 2015. "The remaining three years will see the bank witnessing accelerated growth with the objectives to achieve a balance sheet size of Rs 1,50,000 crore (Rs 1.5 trillion), deposit base of Rs 125,000 crore and advances of Rs 100,000 crore," Yes Bank Managing Director & CEO Rana Kapoor said.
He was addressing the top management, investors and analysts on the completion of two years of its Version 2.0 vision yesterday.
This confidence comes on the back of significant momentum on Casa and retail liabilities front, he said, adding going forward, the bank will focus on branch expansion.
"We have a target of 900 branches, along with increasing headcount to 12,750 by March 2015," Kapoor said.
The bank has 356 branches across over 200 cities and more than 5,600 employees as...
DHANANJAY SINGH
PGDM 2ND SEM.

Facebook reveals revenue, profit slide ahead of IPO

2012-04-23T22:53:00.000-07:00

The company blamed the first-quarter decline, which surprised some on Wall Street, on seasonal advertising trends.
"It was a faster slowdown than we would have guessed," said Brian Wieser, an analyst with Pivotal Research Group.
"No matter how you slice it, for a company that is perceived as growing so rapidly, to slow so much on whatever basis - sequentially or annually - it will be somewhat concerning to investors if faced with a lofty valuation," Wieser said.
Facebook is preparing to raise at least $5 billion in an initial public offering that could value the world's largest social network at up to $100 billion.
"The biggest issue is the realization that Facebook is not going to have an easy time meeting high expectations of the public market," said Jeff Sica, chief investment officer of SICA Wealth Management, which manages more than $1 billion in client assets, real estate and private equity holdings. "It will affect how people look at the IPO."
Investors are still likely to sign up in droves for the IPO; However, growth concerns may make some investors less likely to keep the stock over the long term, he added.
"I'm still encouraging people to participate in the IPO, under the acknowledgement that it could be a bumpy ride," Sica said. "There are high expectations and I hate high expectations."
The company, founded by Mark Zuckerberg in a Harvard University dorm room in 2004, surpassed 900 million monthly active users in the first quarter and said its full-time staff grew by about 1,100 employees to 3,539 in the past 12 months, according to an updated filing with the U.S. Securities and Exchange Commission on Monday.
Facebook also disclosed that it has agreed to pay Instagram $200 million if the company's recent deal to buy the photo-sharing start-up for about $1 billion does not go through.
Facebook said it paid $300 million in cash for Instagram, along with 23 million shares of Class B common stock. It said the fair value of its Class B common stock was $30.89 per share as of January 31.
Spending roughly doubled over the past 12 months, outpacing the 45 percent revenue increase during the period, it said.
Net income slid 12 percent to $205 million in the quarter, from $233 million a year earlier at the rapidly expanding company.
Facebook said its advertising business, which accounts for the bulk of its revenue, typically slows down in the first three months of the year. The rapid advertising growth may have "partially masked" such trends to date, and seasonal impacts may be more pronounced in the future, it noted.
Revenue, which totaled $1.06 billion in the three months ended March 31, declined 6 percent from the fourth quarter. It was the first quarter-on-quarter drop since at least 2010.
"It was bound to happen. You are going to see a slowdown," said Anupam Palit, an analyst at GreenCrest Capital LLC, noting that it is harder to double revenue when the base is larger.
But he also said Facebook has not worked out how to make more money in some international markets where it is growing the fastest, such as Brazil, India and the Philippines.
"They have not cracked international markets yet, while others like Google do very well internationally," Palit added.
Apart from slowing growth, Facebook is also grappling with other issues. Yahoo Inc is suing it for patent infringement even as the social networking company tries to beef up its intellectual property arsenal. On Monday, it said it would pay $550 million for hundreds of patents from Microsoft Corp.
PAYMENTS HINT
Facebook gets most of its revenue from advertising, but has a Payments business centered around Facebook Credits, a virtual currency used mainly to buy virtual goods within social games.
However, the company hinted at a possible an expansion of Facebook Credits into other areas.
Facebook gets a cut of up to 30 percent from virtual goods sales on its platform.
"In the future, if we extend Payments outside of games, the percentage fee we receive from developers may vary," the company said in its IPO filing on Monday.
Some investors expect e-commerce to be a major area of expansion for Facebook. Some industry experts said that if Facebook Credits were used for purchases of physical goods, the company's cut would have to be a lot lower than 30 percent.
(Reporting By Alistair Barr and Alexei Oreskovic; Editing by
DHANANJAY SINGH
PGDM 2ND SEM.

Citi shareholders oppose pkg for Pandit

2012-04-17T22:56:00.000-07:00

New York: Showing frustration with large payouts to Wall Street executives, Citigroup's shareholders have voted against the bank's proposal on top level compensations, which included a USD 15 million package for its India-born CEO Vikram Pandit. The vote came at Citi's annual shareholder meeting held in Dallas on Tuesday.
While the vote is not binding, it is the first time that investors at one of America's largest banks have voted against a board's compensation plan, the New York Times said.
Only 45 per cent of shareholders supported the plan while the rest voted against the proposal on executive compensation, which included approving Pandit's USD 15 million pay package.
Since Citi does not have to act on the vote, Pandit and other top executives could still get their packages but the rejection nonetheless sends out a strong signal.
"Citi¿s board of directors takes the shareholder vote seriously, and along with senior management will consult with representative shareholders to...
DHANANJAY SINGH
PGDM2ND SEM.

HCL Tech Q3 net profit up 28.7% at Rs 602.5 crore

2012-04-17T22:51:00.000-07:00

meaning of finance management

2012-04-17T22:44:00.000-07:00

Meaning of Financial Management

Financial Management means planning, organizing, directing and controlling the financial activities such as procurement and utilization of funds of the enterprise. It means applying general management principles to financial resources of the enterprise.

Scope/Elements

Investment decisions includes investment in fixed assets (called as capital budgeting). Investment in current assets are also a part of investment decisions called as working capital decisions.
Financial decisions - They relate to the raising of finance from various resources which will depend upon decision on type of source, period of financing, cost of financing and the returns thereby.
Dividend decision - The finance manager has to take decision with regards to the net profit distribution. Net profits are generally divided into two:

Dividend for shareholders- Dividend and the rate of it has to be decided.
Retained profits- Amount of retained profits has to be finalized which will depend upon expansion and diversification plans of the enterprise.

Objectives of Financial Management

The financial management is generally concerned with procurement, allocation and control of financial resources of a concern. The objectives can be-

To ensure regular and adequate supply of funds to the concern.
To ensure adequate returns to the shareholders which will depend upon the earning capacity, market price of the share, expectations of the shareholders.
To ensure optimum funds utilization. Once the funds are procured, they should be utilized in maximum possible way at least cost.
To ensure safety on investment, i.e, funds should be invested in safe ventures so that adequate rate of return can be achieved.
To plan a sound capital structure-There should be sound and fair composition of capital so that a balance is maintained between debt and equity capital.

Functions of Financial Management

Estimation of capital requirements: A finance manager has to make estimation with regards to capital requirements of the company. This will depend upon expected costs and profits and future programmes and policies of a concern. Estimations have to be made in an adequate manner which increases earning capacity of enterprise.
Determination of capital composition: Once the estimation have been made, the capital structure have to be decided. This involves short- term and long- term debt equity analysis. This will depend upon the proportion of equity capital a company is possessing and additional funds which have to be raised from outside parties.
Choice of sources of funds: For additional funds to be procured, a company has many choices like-
1. Issue of shares and debentures
2. Loans to be taken from banks and financial institutions
3. Public deposits to be drawn like in form of bonds.
Choice of factor will depend on relative merits and demerits of each source and period of financing.
Investment of funds: The finance manager has to decide to allocate funds into profitable ventures so that there is safety on investment and regular returns is possible.
Disposal of surplus: The net profits decision have to be made by the finance manager. This can be done in two ways:
1. Dividend declaration - It includes identifying the rate of dividends and other benefits like bonus.
2. Retained profits - The volume has to be decided which will depend upon expansional, innovational, diversification plans of the company.
Management of cash: Finance manager has to make decisions with regards to cash management. Cash is required for many purposes like payment of wages and salaries, payment of electricity and water bills, payment to creditors, meeting current liabilities, maintainance of enough stock, purchase of raw materials, etc.
Financial controls: The finance manager has not only to plan, procure and utilize the funds but he also has to exercise control over finances. This can be done through many techniques like ratio analysis, financial forecasting, cost and profit control, etc. Dk seth pgdm 2nd sem

definition of finance

2012-04-17T22:42:00.000-07:00

1. A branch of economics concerned with resource allocation as well as resource management, acquisition and investment. Simply, finance deals with matters related to money and the markets.

2. To raise money through the issuance and sale of debt and/or equity.

Dk seth pgdm

2012-04-16T01:00:00.000-07:00

We are building a company for long term and investors with a long term focus understand that, says Balakrishnan , CFO.

RBI may cut CRR, repo by 0.25%: Bankers

2012-04-16T00:45:00.000-07:00

"My personal stance is that cut CRR...I would expect 75 basis point cut in CRR," SBI Chairman Pratip Chaudhuri said.

Last month, RBI slashed CRR (cash reserve ratio) – the percentage of deposits that banks have to keep with the RBI – from 5.5 per cent to 4.75 per cent. With this, the central bank had infused Rs 48,000 crore into the economy.

Indian Overseas Bank Chairman and Managing Director M Narendra said, "Given the microeconomic condition, there is expectation that the RBI would cut both repo and CRR by 25 basis points (0.25 per cent)".

Showing persistent sluggishness in the economy, industrial production growth slowed to 4.1 per cent in February this year,... mainly due to poor performance of the manufacturing sector and consumer goods segment.

At the same time, inflation has been hovering around 7 per cent and global crude oil prices are still over USD 100 per barrel, adding to inflationary pressures. The inflation was 6.89 per cent in March much above the RBI's comfort level.

RBI, which increased the key policy rate 13 times between March 2010 and October 2011 to tame inflation, did not hike the repo rate (short term lending rate) in the last three policy reviews.

On the other hand, India's GDP grew by the slowest pace in the last 3 years to just 6.1 per cent in the third quarter of 2011-12.

Mutual Funds Check for top funds

The GDP growth rate for the third quarter was lower compared to 6.9 per cent in the previous quarter and 8.3 per cent in the samequarter last financial year.

Since October 2011, the repo of RBI has stood at 8.5 per cent. Repo rate is the signalling rate. Other policy rates like reverse repo and bank rate adjust automatically with change in the repo rate.

On the possibility of repo rate reduction by the RBI, Chaudhuri said, "I am not too hopeful and frankly I don't think this is material".

According to Bank of Baroda Chairman and Managing Director M D Mallya, "We saw last year that growth was not very substantial. We have seen the overall interest rate scenario reigning high. So, perhaps some policy measures are required to ensure growth is also catered to without compromising on inflation."

Mallya said overall liquidity is likely to improve after Government spending starts.

Hit by tight liquidity conditions, banks are still borrowing on an average about Rs 80,000 crore from the central bank every day.

Punjab National Bank Chairman and Managing Director...

ANAND PRAKASH

PGDM 2nd (sem)

Inflation moderates to 6.89% in March

2012-04-16T00:37:00.000-07:00

Inflation for January was revised higher to 6.89% from the preliminary estimate of 6.55% while the revised WPI for that month now stands at 158.2 as compared to 157.7 earlier.

India's annual inflation decreased slightly in March from the previous month, data released by the Government showed on Monday.

The headline WPI inflation for March stayed below the 7% mark after falling below it in January.

Inflation, as measured by the wholesale price index (WPI), was at 6.89% in March as against 6.95% in February, the Union Commerce & Industry Minister said today.

The March inflation print was slightly better than consensus expectations.

The annual inflation rate was at 9.68% during the corresponding month of the previous year.

Inflation for January was revised higher to 6.89% from the preliminary estimate of 6.55% while the revised WPI for that month now stands at 158.2 as compared to 157.7 earlier.

The official WPI for ‘All Commodities’ for March rose by 0.9% to 159.8 from 158.4 in the

preceding month.

Build up inflation in the financial year so far was 6.89% compared to a build up of 9.68% in the corresponding period of the previous year.

WPI Break-up for March 2011:

Primary Articles: 9.62% vs 6.28% MoM

Food Group: 9.94% vs 6.07% MoM

Fuel & Power: 10.41% vs 12.83% MoM

Manufacturing Products: 4.87% vs 5.75% MoM

Source: Commerce & Industry Ministry.

Onions turned cheaper by ~24% in the month under consideration, Vegetable prices were up ~30% on an annual basis. Fruit prices were down by 4.5% year over year, while Milk prices increased ~15.3%. Egg, Meat & Fish became costlier by ~17.7% compared to the year-ago period.

Potato prices were up ~11.60% on an annual basis while Cereal prices went up by ~4.4% year over year. Prices of Pulses rose by ~10%. Annual inflation in Rice stood at ~4.7% while Wheat prices were down ~0.7%.

In the Non-Food category, prices of Oilseeds rose by ~12.8% from a year ago while that of Fibres fell by ~31.4%. Mineral prices climbed more than 28.5% from last year.

In Fuel & Power category, LPG prices were up ~14.3%, petrol by ~12.04% and diesel by ~9.2%.

In Manufactured Products category, Food Products prices rose by ~6%, while that of Edible Oils increased by ~10%. The price of Beverages, Tobacco & Tobacco Product jumped 8.2% while that of Cotton Textiles fell ~8.5%.

Price of Wood & Wood Products increased by ~7% while that of Leather & Leather Products increased 4.5%.

Chemicals & Chemical Products' prices jumped by ~7.4% while that of Non-Metallic Mineral Products rose by 5.6%, Cement & Lime ~4.75%, Basic Metals Alloys & Metal Products ~9.5% and Iron & Semis by ~17%.

By RAZI ANWAR(PGDM 2nd Sem)

STOCK EXCHANGES FOR ABOLITION OF STT IN BUDGET

2012-04-16T00:35:00.000-07:00

NEW DELHI: Stock exchanges today pitched for abolition of the securities transaction tax (STT) on equity trades at their meeting with finance ministry officials here.

The issue of removal of STT was raised by representatives of different stock exchanges, including BSE, National Stock Exchange, MCX-SX and USE. Besides, the officials of the market regulator Securities and Exchange Board of India (Sebi) were also present in the meeting.

"Finance ministry has taken our view on developments in stock markets and STT. We have suggested removal of STT. Based on our view the ministry will take a view," a representative of a stock exchange said.

"We are expecting some announcement in budget. We also stressed that taxes should not be increased and no new taxes should be introduced," an official from another stock exchange said.

Earlier in the day Sebi chairman U K Sinha too met finance ministry officials.

The government had introduced STT in 2004 on transactions in different types of securities. The rate presently varies from 0.025 per cent to 0.25 per cent depending upon the type of security traded and transaction -- whether sale or purchase.

The government collects around Rs 7,500 crore per annum from STT and it would be difficult for it to forego the revenue at a time when efforts are needed to raise revenue and bridge the fiscal deficit, which during the current fiscal is likely to exceed the budget target of 4.6 per cent of the gross domestic product (GDP).

The discussions are aimed at providing inputs to the budget for 2012-13 which will unveiled by finance minister Pranab Mukherjee on March 16.

The capital markets division of the finance ministry has been pushing for lowering of STT as it would boost investor sentiments.

The stock exchanges, however, are seeking removal of the levy as it would reduce transaction cost, promote equity culture and encourage retail participation.

PRIYANKA KUMARI
PGDM 2nd SEM

RBI may cut CRR, repo by 0.25%: Bankers

2012-04-16T00:27:00.000-07:00

New Delhi: The Reserve Bank of India (RBI) may cut interest rate by about 0.25 per cent and release more liquidity in its annual credit policy meet tomorrow in the light of sagging factory output and moderation in economic growth, say bankers.
"My personal stance is that cut CRR...I would expect 75 basis point cut in CRR," SBI Chairman Pratip Chaudhuri said.
Last month, RBI slashed CRR (cash reserve ratio) – the percentage of deposits that banks have to keep with the RBI – from 5.5 per cent to 4.75 per cent. With this, the central bank had infused Rs 48,000 crore into the economy.
Indian Overseas Bank Chairman and Managing Director M Narendra said, "Given the microeconomic condition, there is expectation that the RBI would cut both repo and CRR by 25 basis points (0.25 per cent)".
Showing persistent sluggishness in the economy, industrial production growth slowed to 4.1 per cent in February this year,.
DHANANJAY SINGH
PGDM 2ND SEM.

Rupee down 32 paise against dollar

2012-04-16T00:24:00.000-07:00

Mumbai: The rupee fell 45 paise to a fresh three-month low of 51.75 against the American currency in the late morning trade on fresh dollar demand from banks and importers amid weak equity market.
The rupee resumed lower at 51.61/62 per dollar at the Interbank Foreign Exchange (Forex) market against last Friday's close of 51.30/31 per dollar and dropped further to 51.75 per dollar. It was quoting at 51.68/69 per dollar at 1030 hrs.
It moved in a range of 51.58 and 51.75 per dollar during the morning deals.
Fresh dollar demand from banks and importers in view of weak equity market amid firm dollar overseas affected the rupee value, a forex dealer said.
The BSE 30-scrip benchmark Sensex declined 30.94 points or 0.18 per cent to 17,063.57. Earlier, it was down 62 points.
In New York, the dollar extended gains against major currencies last Friday as investors reacted to weak data on US consumer sentiment..
DHANANJAY SINGH
PGDM2ND SEM.

The International Monetary System and the Financial Crisis

2012-04-16T00:19:00.001-07:00

In contrast to its predecessors—the gold and dollar standards—the current international monetary system has served the global economy well, even in the most difficult of times. During the Great Recession—the worst downturn in seventy years—the system exhibited great flexibility and resilience. Countries with flexible exchange rates, which account for 80 percent of global gross domestic product (GDP), used them to good effect as shock absorbers. Several countries with pegged rates switched to more flexible regimes during the crisis and some switched back again when confidence returned. These changes were nearly always orderly, with most currencies following a common path against the dollar, which retained its safe-haven status despite the fact that the United States was at the epicenter of the crisis: Currencies depreciated against the dollar during the worst of the crisis and then appreciated again once it ended. Though some currencies saw large real appreciation, most remained in line with fundamentals; misalignments occurred in only a few instances, usually related to the dysfunctional institutional set-up of the eurozone monetary union. Overall, the global economy avoided the balance of payments crises and protectionist responses that characterized previous episodes of acute economic turmoil.
For these reasons, it is difficult to conclude that today’s exchange rate system is fundamentally flawed. At the same time, a number of undesirable developments and responses have occurred in the aftermath of the Great Recession: some developing countries have excessive reserves; several countries have reluctantly resorted to capital controls; a few countries, including Brazil, Switzerland, and Japan, have seen very large exchange rate appreciations; the eurozone is in deep crisis; and fear persists that global imbalances may widen again as the recovery progresses.
by:
Jasleen kaur
II SEM

wacc

2012-04-16T00:19:00.000-07:00

Definition of 'Weighted Average Cost Of Capital - WACC'

A calculation of a firm's cost of capital in which each category of capital is proportionately weighted. All capital sources - common stock, preferred stock, bonds and any other long-term debt - are included in a WACC calculation. All else equal, the WACC of a firm increases as the beta and rate of return on equity increases, as an increase in WACC notes a decrease in valuation and a higher risk.

The WACC equation is the cost of each capital component multiplied by its proportional weight and then summing:

Where:
Re = cost of equity
Rd = cost of debt
E = market value of the firm's equity
D = market value of the firm's debt
V = E + D
E/V = percentage of financing that is equity
D/V = percentage of financing that is debt
Tc = corporate tax rate

Dk seth pgdm

Apple iPhone 5 debut in Oct.?

2012-04-10T23:54:00.000-07:00

Rumors about Apple's (NASDAQ:AAPL - News) 6th-generation iPhone are picking up, with media reports saying the new smartphone will be out in Oct. The consumer electronic giant's newest offering is expected to have a 4-inch screen, up from the current 3.5 inches, and a sleek new unibody chassis, according to a Topeka Capital Markets analyst. Apple hit a record intraday high of 644, briefly topping a market share of $600 bil. But shares closed down 1.2% to 628.44.
ASHRAF HUSSAIN
PGDM 2ND SEM.

RBI seen cutting repo rate for first time in 3 years: Reuters Poll

2012-04-10T23:48:00.000-07:00

By Shamik Paul and Neha Dasgupta

MUMBAI (Reuters) - The Reserve Bank of India is likely to cut its repo rate for the first time in three years in an attempt to lift sagging economic growth, even as high oil and food prices remain a challenge to managing inflation, a Reuters poll showed.
Of 20 analysts polled, 17 expect the RBI to cut the repo rate by 25 basis points to 8.25 percent on April 17, while three see it unchanged at 8.50 percent.
The RBI has held its key interest rate steady since its policy review in mid-December, after raising it 13 times from March 2010 to tame high inflation, most recently in October. Its last rate cut was in April 2009.
"The driving factor for a repo cut is basically to pull down the cost of funds. The slowdown in the economy is coming from a drop in investments, and that has to be reversed," said Saugata Bhattacharya, an economist with Axis Bank.
Of 19 respondents, 13 expect no cut next week in the cash reserve ratio (CRR) requirement for banks, or the share of deposits lenders have to maintain with the RBI.
Only four respondents forecast a 50 bps cut in CRR on April 17, while two see a 25 basis point cut.
In January, the RBI cut CRR by 50 bps, and further reduced it by 75 bps in March to 4.75 percent to ease tight liquidity in the banking system ahead of advance tax payments by companies.
Economists have scaled back their expectations for rate cuts in the fiscal year that started this month but have increased their expectations for cuts in CRR since a poll in March.
The median estimate for the repo rate in March 2013 now stands at 7.75 percent, higher than the estimate of 7.50 percent in a poll last month. Similarly, the median estimate for CRR is 4 percent, compared with 4.25 percent in March.
India's economy grew at just 6.1 percent in the December quarter, the slowest in nearly three years.
High food inflation is likely to pinch Indians at least until July as fruit and vegetable output shrinks, hurt by rising temperatures and dry conditions, while edible oil and pulses prices are rallying on lower production and a more expensive world market.
The wholesale price index, the main gauge of inflation, edged up a faster-than-expected 6.95 percent from a year earlier in February. Analysts are keenly awaiting the March inflation data to be announced a day before the RBI's policy.
However, non-food manufactured inflation is likely to remain low, which will offset some of the impact of high food prices, analysts said.
Further inflationary pressure could emerge if India cuts subsidies on diesel and cooking fuels, and if state oil retailers raise the price of petrol to reflect the rise in global crude prices.
(Additional reporting by Mumbai Treasury Team; Editing by Tony Munroe and Ranjit Gangadharan)
DHANANJAY SINGH
PGDM 2ND SEM.

Tata Steel India FY'12 sales up 3.4%

2012-04-09T23:19:00.000-07:00

New Delhi: Tata Steel today said its sales from Indian operation grew by 3.4 per cent in FY'12 to 6.631 million tonnes over 2010-11, buoyed by a six per cent rise in sales to automotive and Fast Moving Consumer Goods (FMCG) sectors.

The company, which had sold 6.416 million tonnes steel in 2010-11, undertook sales of 3.735 million tonnes flat products used in the automotive and the FMCG sectors, and 2.897 million tonnes of long products used in construction, it said in a statement.
The growth in sale of flat products was six per cent over 2010-11, but it was almost static in case of long products. It had sold 2.878 million tonnes of long products in FY'11.
The company sold 1.768 million tonnes of steel in the final quarter of 2011-12, registering a growth of 3.3 per cent over 1.712 million tonnes in the corresponding quarter.
ASHRAF HUSSAIN
PGDM-2ND

Finance offers top IIM-C placement drive

2012-04-09T23:16:00.000-07:00

Kolkata: Despite a slowdown in the financial sector, the Indian Institute of Management, Calcutta (IIM-C) continued to draw attractive offers from major international financial hubs during placements this year. Mutual Funds
Of the offers, finance constituted the largest chunk at 28.53 per cent, according to an IIM-C placement report.
Consulting companies also contributed to a significant portion of the pie with 26.80 per cent, closely followed by sales and marketing at 22.48 per cent and general management at 8.93 per cent.
The premier institute said Infosys offered five international positions in the US and London offices of its global sales team and Microsoft offered nine positions.
It said despite the slowdown in the finance sector, IIM-C maintained its position as the "finance campus" of the country.
Students had already received PPOs (pre-placement offers) from firms like UBS, Goldman Sachs, JPMorgan Chase, Morgan Stanley, Barclays Capital, Royal Bank of Scotland, HSBC..
DHANANJAY SINGH
PGDM 2ND SE.

Maruti 800 replacement coming by year-end

2012-04-09T01:02:00.000-07:00

The car will be priced in the range of Rs.2.5-3.5 lakh.

The three decade-old Maruti 800 will bid its final goodbyes before the end of this calender year, to make way for its revamped avatar.

The model had already stopped being sold in the top 13 cities in India from Sep 2010 as it could not meet the Bharat Stage IV emissions norms made mandatory in these cities from that date.

The new model of the car, to be launched under a new brand but the same platform, will use the same F8D engine used in the base Alto, although updated to match competition.

The car will be priced in the range of Rs.2.5-3.5 lakh.

“A replacement for the 800cc model makes sense as it hasn't been selling very aggressively at about 2,000 units a month. This will be a totally new small car, though based on an existing platform,” reports said quoting a company official.

Reports said that Maruti Suzuki will focus the main purchase parameters in the small car segment i.e. fuel efficiency and low maintenance.

By RAZI ANWAR (PGDM 2nd sem)

Satyam Computer receives claim notice from Aberdeen Global

2012-04-09T00:59:00.000-07:00

Satyam Computer Services Ltd has announced that a claim form addressed to Company’s branch office at UK, as filed before the High Court of Justice, Queen’s Bench Division, Commercial Court, UK, for an amount to be assessed, has been received from Aberdeen Global & Others. It's alleged in the claim, an estimated loss in excess of US$150 mn, opportunity loss and interest @ 8%, due to the investment made in the Company’s stock and / or ADSs.

By RAZI ANWAR(PGDM 2nd sem)

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