The+IBS+Times_135th+issue by Stock Yard

ISSUE - 135

7th DECEMBER [WEDESDAY]

SYNOPSIS

- SWATI VERMA

The shams just don‟t seem to end in India ,it seems! With the country envisioning a corruption free future, high ranking officials seem to make the dream a distant reality. Under scanner is the BCCI which has been charged with money laundering to the tune of almost Rs. 11 billion. Lack of transparency and no official accountability set in place seem to be the breeding ground of such issues. Talking more on the same is our writer through the Cover Story this week. The year 2012– supposedly the year of end is the protagonist of the Opinion Forum this week. Let me present you with a quick preview– The Euro Zone crisis, currency devaluations ,slumping world trade and a fairly poor performing global economy. Is the end probable or just nervous jitters? Elucidating on the same is our writer this week. Lakmé is a word synonymous with high value cosmetic brand ,for the Indian woman especially. Pt. Jawahar Lal Nehru‟s wish that every Indian woman could afford a branded range of cosmetics led to the birth of this luxury giant in India. Ranging from cosmetics to conducting an annual fashion fiesta with top designers presenting their collection to a global audience, Lakmé has gone far and wide in it‟s reach. Hence presenting the Lakmé story through Brand Track this week. The traditional banking practice of providing loans from the reserves that the Central Banks allocates is gradually diminishing due to the simple reason-the reserve requirements have dropped to zero. We try to bring to you a simple model of the current banking system that includes interest on reserves and no binding reserve requirements. We see how bank lending quantities and interest rates are invariant to the level of reserves chosen by the central bank through the Focus this week. Moreover we have our regular sections Fast Track, Quick Bites and Market Watch with lot of Jargons to add on to your knowledge. Hope it‟s an enriching read! Swati Verma

SYNOPSIS COVER

1 OPINION 2 BRAND

5 FOCUS 6 MARKET

FAST-TRACK

3 QUICK BITES

8 9

THE IBS TIMES

COVER STORY– BCCI - BACK TO PAVALION!!

- SHILPI KALWANI Who thought what Mark Twain said in the past would become BCCI‟s Principle- “Honesty is the best policy- when there is money in it”!! India‟s largest sports authority is under the scan of Parliament for reasons relating to lack of transparency. Rolling in crores, the BCCI is a money-minting behemoth. The Board of Control for Cricket in India (BCCI) is under investigation for violating the country's laws (Under FEMA- Foreign Exchange Management Act) amounting to some 10.77 billion rupees , Sports Minister Ajay Maken said on Tuesday. He said the investigation covered the ownership of franchises and fund transfers without the permission of the Reserve Bank of India (RBI) and income tax department during the 2009 Indian Premier League held in South Africa.

Honesty is the best policy - when there is money in it”!!

India’s

largest

sports authority is under the scan of Parliament for reasons relating to lack of transparency.

Is BCCI – Covering the Uncovered? When the question was raised by media, former player Arun Lal said- „He welcomes any move that makes the BCCI more transparent but warned the government should not try to hijack the game's administration‟. The Indian sports ministry on Tuesday pushed for a bill that seeks to reform sports federations but is perceived as an attempt to control the country's rich and powerful cricket board. The bill seeks to limit the tenure of sports administrators and bring transparency in the federations by bringing them under the country's Right to Information (RTI) Act."What was the need to bring this bill? Is government trying to take over the sports federations?" - asked BJP parliamentarian Anurag Thakur. Maken answered this by saying- "How, is bringing a Sports Body under RTI tantamount to controlling it, I fail to understand." There exists two crossroads for the same. On one hand sports minister supports the bill by ensuring it as a step to make BCCI more accountable whereas on the other hand some consider it as government trying to take the steering of control in their hands. “Cricket should not expect special treatment.” - said Mohammad Azharuddin (Former Captain & Congress Parliamentarian). In contrast, some other federations have not witnessed a change in their top administration for up to three decades, as is the case with the Archery Association of India. This is a bill covering all sports & so, cricket cannot be an exception.

BCCI exposed- behind the mask of charity The sale of Indian Prem-ier League (IPL) telecast rights, franchises and tickets (amounting to approx. Rs. 9000 crores) / a donation made to charity. The Board of Control for Cricket in India (BCCI) insists that both activities qualify to be called philanthropic; whereas the income-tax authorities think otherwise. Formed in December 1928, registered as a charitable trust under Section 12(a) of the Income Tax Act 1961, the BCCI hitherto enjoyed exemption stating that it „promotes cricket for general public good‟. When denied exemption (1990), the board highlighted the Rs 50 lakh donation it intended to make to the Kargil Relief Fund & demanded tax exemption. However, following the game-changing amendment of the Finance Act 2008-09, it was stated that the object of BCCI does not fall under public welfare, & the Should the Government withdrawal of exemption took place. This step followed the BCCI‟s move to covertly amend its rules and add new objectives in its memorandum, including setting up coaching academies and conducting the lut a k e o v e r B C C I ? crative IPL. Moreover, after examining the acc-ounts of cricket associations affiliated to the BCCI, the I(Answer of poll conducted T department has issued show-cause notic-es to seven such units with headquarte-rs in Delhi, Mumbai, Chennai, Kolkata, Hyderabad, Bangalore and Ahmedabad.

by cricket circle)

“BCCI’s profits have been growing at a faster rate than Infosys’’ BCCI is the richest cricket board in the world with revenues of Rs 16.63 crore and reserves of Rs 44 crore. And with a Rs 235-crore, five-year television rights contract signed with Doordarshan, which is worth Rs 42 crore annually, BCCI‟s already overflowing coffers are going to be groaning further under the weight. It was alleged by some members of CSA that approximately 68 million Rand had gone missing from its coffers and that some officials had been paid close to 4.8 million Rand in bonuses for the successful conduct of the IPL in South Africa in 2009.

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FAST-TRACK NEWS

THE IBS TIMES - SWATI VERMA

FDI: Govt. asks traders to give suggestions within one week Ruling out the possibility of any rollback of the decision to allow 51% foreign direct investment (FDI) in multi-brand retail, the government asked the agitating traders to submit their suggestions for necessary safeguards within one week. It was also decided to form a joint working group of traders and government officials to address the concerns of the trading community. This was the result of a meeting between the Union Commerce and Industry Minister, Anand Sharma and the representatives of the Confederation of All India Traders (CAIT) in Delhi, where no common ground was found between the two parties.

Economic growth will pick up pace before March: Kaushik Basu Terming the slowdown in the Indian economy as a temporary phenomenon, chief economic adviser Kaushik Basu exuded confidence that it will start accelerating towards the end of the current fiscal. India‟s economic growth rate slipped to 6.9% in the second quarter this fiscal, the lowest in nine quarters. Meanwhile, finance minister Pranab Mukherjee said economic growth will moderate to about 7.5% in the current fiscal. Slackening investments amidst high interest rate regime is seen as one of the major reasons for slowdown in economic activities in the country.

Despite woes, Kingfisher remains favourite airline: Survey In spite of the mounting troubles and the recent flight cancellations, Kingfisher continues to remain the favourite airline in the country, an honour which it shares with Jet Airways this year, according to an annual airline and air travel survey .While Vijay Mallya-promoted Kingfisher is the best airline for in-flight entertainment, food/beverages, in-flight service, in-flight maintenance (cabin lighting, cleanliness, seat comfort, leg room), Naresh Goyal-headed Jet leads in ground handling and landing/take-off quality. India's largest low-cost carrier IndiGo comes next at No 2, said the survey by travel advisory portal TripAdvisor.

Apple Questioned by German Data Regulator About Carrier IQ A German data regulator asked Apple Inc. to answer questions about privacy issues regarding the usage-tracking software Carrier IQ on mobile phones. Carrier IQ faces allegations that the software logs sensitive phone-user information. U.S. Senator Al Franken urged the software‟s developers to share more information about what the product does, and whether it transmits data to other parties. The Bavarian State Authority for Data Protection sent a letter to Apple to request information about the software. Apple said yesterday that it will stop supporting Carrier IQ software.

Rupee rises more on local shares, corporate dollar sales The rupee held firm in afternoon trade on Friday, helped by corporate dollar sales, positive domestic equities and some portfolio flows. The government's move last week to liberalise foreign direct investment in multi-brand retail chains along with the central bank's decision to ease rules on overseas borrowings by firms and raise ceiling on interest rates for deposits by non-resident Indians has improved view on dollar supply. The BSE Sensex recovered all early losses and was up nearly 1.8%.

World AIDS Day 2011- Beginning of a new end With the profile of HIV-AIDS undergoing transformation from a life-threatening emergency to a manageable chronic infection, the World Health Organisation (WHO) on Wednesday urged South-East Asian countries to focus on eliminating the infection, particularly among children, by 2015."We are coming out of a transformative decade for the HIV-AIDS epidemic. With innovative treatment regimens, improved health services as well as political commitment, HIV-positive people who are on treatment are living longer and better lives," said Samlee Plianbangchang, WHO regional director for South -East Asia.

Jewellery shops give stiff competition to gold ATM India welcomed the latest arrival in Mumbai's modern Phoenix Mills mall - a gold ATM machine selling jewellery and 31,000-rupee gold coins - but for more than just window-shopping, it faces stiff competition from traditional stores. India's first such machine may be grabbing the attention of passers-by in the world's biggest bullion market, but upstairs in an airconditioned store, the sparkling gold and silver bangles offered by smiling sales assistants have customers grabbing their credit cards. How well will it be accepted, only time will tell.

In the Pink– Informal expression used to describe a situation in which an investor or economy is in good financial position. Generally, being in the best of health (or rosy).

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THE IBS TIMES Myanmar's Suu Kyi praises U.S. engagement Pro-democracy leader Aung San Suu Kyi -Suu Kyi - the Nobel laureate who has come to symbolise the pro-democracy aspirations of Myanmar's people -welcomed renewed U.S. engagement with Myanmar, saying she hoped it would set her long-isolated country on the road to democracy. U.S. Secretary of State Hillary Clinton held a final meeting with Suu Kyi as she wrapped up a landmark visit to Myanmar which saw the new civilian government pledge to forge ahead with political reforms and re-engage with the world community. Australia government denies backing India, U.S. security pact Australia denied on Friday it was pushing for a joint security pact with India and the United States, a tie-up that would likely add to China's fears that wary neighbours were trying to encircle it. Foreign Minister Kevin Rudd was quoted in an interview with the Australian Financial Review newspaper this week as backing the idea of a trilateral security pact. Germany's Merkel fights for euro German Chancellor Angela Merkel called for rapid EU treaty change to remedy the root causes of the euro zone's debt crisis but warned that Europeans faced a long, hard â&#x20AC;&#x17E;marathonâ&#x20AC;&#x; to restore lost credibility. Outlining a long-term approach to tighter fiscal integration in the single currency area, with tougher budget discipline, she dismissed quick fixes such as massive Fed-style money printing by the European Central Bank or issuing joint euro zone bonds, vowing to defend the euro, which she said was stronger than Germany's former deutschemark. Telecom Commission defers pricing, M&A decision India's Telecom Commission will meet again next Friday to discuss proposals from the country's telecoms regulator on pricing of second-generation spectrum and mergers and acquisitions in the sector. Last month, the Telecom Regulatory Authority of India TRAI proposed a relaxation of rules for M&A in the telecoms sector in a move to facilitate a long-awaited consolidation in the 15-player market. Earlier this year, the regulator proposed steep increases in spectrum prices and a one-time fee on spectrum beyond 6.2 megahertz, drawing howls of protest from firms. The regulator's proposals have to be approved by the telecoms ministry to become law. Advani, Chawla in semi-finals of World Snooker Pankaj Advani and Kamal Chawla chalked up contrasting victories to enter the semi-finals of the IBSF World Snooker Championship here on Friday. Advani, though nowhere near his best, carried enough ammunition to bring down Belgium's Peter Bullen 6-2 (71-07, 00-123, 34-75, 92-21, 67-60, 70-09, 69-16, 80-45) while Chawla, the 32-year-old from Bhopal, overcame another Belgian, Kevin van Hove, 6-5, in a tight match. Zynga IPO values company as high as $9.04 billion Zynga Inc plans to sell an 11.1% stake in a scaled-back initial public offering that would value the Facebook game maker at as much as $9 billion on a fully diluted basis. The leading social games maker plans to sell 100 million new shares at between $8.50 and $10 each. At the midpoint price, the IPO could raise $925 million, which would make it the largest from a U.S. Internet company since Google Inc raised $1.7 billion in 2004.Five-year-old Zynga made its name on viral games such as "FarmVille," among the most popular on the Facebook social network. Carpetbagger - Someone who opens a building society account with the minimum investment with the sole aim of getting a windfall if it floats on the stock exchange or is taken over.

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THE IBS TIMES

OPINION FORUM– 2012: EUPHORIA OR AGONY?

Top Wealth Management firm, Merrill Lynch, expects the Global Economy to grow at just 3.7%, China at 8.6% and Incredible India at a paltry 7.5%.

Also the emerging as the clear undisputed white elephant in the herd is Europe now being identified as a total dead-end

- AKSHAY AGRAWAL

Since all my articles preceding this one ceased with idioms heeding caution, here‟s one more in the series veritably highlighting the nuances of what to anticipate in 2012.Written with an absolute unbiased demeanour and the core emphasis being the various issues staring at the economy & us in the face, I hope my readers find it of much usefulness. With both, the prophets and India TV (since they have no clue on what news is) envisioning the world coming to an end in 2012 (and thereby putting seers like Nostradamus to shame) and subjecting its audience to a hearty laugh, one thing common to senior investment bankers, fund managers, and Economists alike is their gloominess when it comes to expressing anything quintessential about 2012.The only commoner, being the extreme volatility of the markets, hopes being restricted to the extent of the wrath. Top Wealth Management firm, Merrill Lynch, expects the Global Economy to grow at just 3.7%, China at 8.6% and Incredible India at a paltry 7.5%. Instantly striking my mind, is the hit single “Riders on the Storm” (Saluting the Doors). Most of us already have a glimpse of the currently fragile growth rates, decreasing numbers of safe havens to invest in (read the victim as the „Common man‟). Clearly investment managers are expecting 2012 to be a very tough year with politicians and policy initiatives trying their very best to make the economy even more sluggish. True not only for India, Europe has also joined the party. Rendered totally helpless by the current market and economy scenario experts in increasing numbers are pointing and expressing their inability to identify and project risk. They are already crying foul with the ever-shrinking financial system and the government bond markets being rigged. Also the emerging as the clear undisputed white elephant in the herd is Europe now being identified as a total dead-end. Instead of concluding my article this time with just a few words of wisdom, which may already be being touted as „Gyaan‟ by my readers, I go one step further this time to enunciate what exactly should be the „Karma‟ of the Investors! Most big investment and wealth management houses are now recommending that almost all categories of investors should concentrate wholly and solely on the guru mantra of diversification so that if they are faced with the wrath of the volatility in one segment, the other segment acts as an life-saver. The focus of the investors should also cover the vital issues of yield on investment, the quality of their investments and the opportunity to diversify only after careful judgement. In addition, the preferable sectors could include consumer discretionary, consumer staples and our most pampered sector (read IT) and a total no-go for European equities hint (with a wink): I just received a mail from my bank advising me to go in for a SIP (Systematic Investment Plan) to build up a corpus ranging from lakhs to even a crore! With time periods from 10 to 25 years. Wait! Wasn‟t the world ending in 2012?

Ear Stroking - A twist on the phrase 'ear bending' which is used to describe the way that the Bank of England lets the City know what it would like to happen in any given circumstance. Stroking is meant to denote gentle as opposed to crude persuasion.

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THE IBS TIMES

BRAND TRACK– LAKME –COSMETICS INDIANISED!!

More recently in August 2011, Kareena Kapoor was roped in to be the ambassador for the brand’s elite long wear range of cosmetics„Lakmé Absolute’.

Lakmé also took a successful

step

towards

bringing the fashion industry of the country closer to the Global glamour industry by launching the Lakmé fashion week.

-POOJA DALAL

India is a diverse state. And even more diverse are its people and their needs. Thus out of this sublime understanding of the needs of the natives, a personal care brand was born. It was originally started as a subsidiary of TATA oil mills. Having come into being in India was one of its prime strengths. People were not yet „consumers‟ and their incomes were not yet „great‟. So it was necessary to position its products as the essentials of self-care rather than vanity purchases. Lakmé has many product lines that include hair care, cosmetics and skin care. Within all the product categories it has different range of products to suit every pocket. There is a small pack of moisturiser for Rs.70, and there is the professional cosmetic range for the ones who care more about their looks than their purses. Apart from the price ranges, products are classified by the purposes they serve for a niche segment. Like the 9 to 5 range is meant for the everyday use by working women, the bridal sutra range is aimed at the traditional use of make-up. Different as these products might be, there is one common thread that runs common to all, that is the exemplary quality and its contemporary nature. But Lakmé has never been satisfied with what it has already achieved. It always has been a leader in the true sense. Thus when the service industry boomed in the country, it also went on to take advantage of its growth by opening up a chain of Lakmé beauty salons all over the country. These salons provided a complete beauty solution to a geographically diverse clientele. They claim that - „we pride ourselves on being the best. From the class ambience to the extreme attention to personal hygiene, you can count on world-class expertise at each of our 88 beauty salons across India. Lakmé also took a successful step towards bringing the fashion industry of the country closer to the Global glamour industry by launching the Lakmé fashion week. It is one of the platforms that have nurtured the talented and young artists to display and bring to life, their collections and creativity while also being adored by veterans like Manish Malhotra. For bringing the show live, Lakmé partners with many other companies like Aircel, INIFD (International institute of fashion design), Kingfisher Ultra, Blender‟s Pride and many more. Apart from being perfectly managed in the „Management‟ sense, these fashion shows go a mile further to appeal the public. It does so by making sure that it‟s Red Carpets remain „Star studded‟ for every occasion. Esha Deol graced the occasion of Lakmé fashion week 2011, but it was Hema Malini who glided as the show stopper and received a thunderous applause that her ethereal demeanour commands! Apart from having fabulous services (in the form of nationwide salons) and hosting the single mega fashion event of the year in India, the brand also has a sturdy celebrity backing. Deepika Padukone and Raima Sen have been some popular Bollywood celebs to have endorsed the brand. More recently in August 2011, Kareena Kapoor was roped in to be the ambassador for the brand‟s elite long wear range of cosmetics- „Lakmé Absolute‟. An absolute necessity that these cosmetics are in our daily lives these days, reminds of a few good things that could happen to your skin this winter! Yeah guys, you could use that „green eyed monster‟ to surf Lakmé website and find something that suits you.

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THE IBS TIMES

QUICK BITES- NEWS THAT CAN’T BE MISSED !

- ANKIT SHARMA

Big Shots… Merkel vows to build fiscal union Indian households hold over $950 billion worth of gold

Company Talks… Bank of India buys 51% in Bharti-AXA joint venture, returns to mutual fund business Bank of India buys 51% in Bharti Axa MF Government proposes to merge two RRBs in Bengal Himachal cancels agreement with winemaker Indage Vintners Minus Ericsson, Sony to only make smartphones Carrier India buys out Sauter Race Italian food chain Ci Gusta to enter India NTPC warns BSES of supply cut if dues not paid ONGC Videsh faces Syria shutdown after European Union blacklist Reliance Industries to submit fresh estimates of cost & reserves for KG-D6 block investment plan JSW Steel hopes to start work on Rs 20,000 crore Bengal steel plant this month QuEST acquires GKN Aerospace's engineering division Escorts Construction Equipment eyes land in Gujarat and MP for manufacturing unit Ranbaxy launches low-cost version of medicine 'Lipitor'

Economy Speaks… US unemployment drops to 8.6% Reserve Bank of India vows to check rupee slide FDI: Traders reject joint panel offer, says halt FDI in retail policy first Huge investment needed in urban transport: Ministry Rupee fall not to majorly impact year-end inflation target: RBI RBI to issue new Rs 10 notes Before knocking on WTO doors, India seeks talks with US on steel duty Diplomats woo Punjab industry to invest in Africa FIEO demands interest subsidy for all export sectors India's exports rise 10.8% in October: Government

The Captains of the Ships… Head of Essar Group„s assurance & cost control divisions – Arvind Chopra CEO of Saatchi & Saatchi India – Matt Seddon CEO and Managing Director Ranbaxy – Arun Sawhney

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THE IBS TIMES

FOCUS OF THE WEEK– BANK RESERVES AND ITS IMPACT ON LENDING

- AVLEEN KAUR SARNA

Many things from stones to baseball cards have served the monetary functions through the ages. The current banking system worldwide no longer resembles the traditional textbook model of fractional reserve banking. Historically, the quantity of reserves supplied by the central bank determined the amount of bank loans. Through the „money multiplier‟, banks expanded loans to equal the amount the amount of reserves divided by the reserve requirement. However now in many countries, the reserve requirements have either been reduced to zero, or to such small levels that they are no longer binding. Thus we develop a simple model of the current banking system that includes interest on reserves and no binding reserve requirements.

Perhaps, because of its novelty the large quantity of reserves in the banking system has generated a great amount of concern and debate..

Through the ‘money multiplier’, banks expanded loans to equal the amount the amount of reserves divided by the reserve requirement. However now in many countries, the reserve requirements have either been reduced to zero.

We show that with no frictions, bank lending quantities and interest rates are invariant to the level of reserves chosen by the central bank. Banks lend up to the point where the marginal return on loans equals the return on holding reserves, which is equal to the interest rate on reserves set by the central bank. This provides an indifference result for the quantity of reserves. Actually, banks hold reserves for two main reasons, firstly to meet any reserve requirements and secondly to provide a cushion against uncertainty related to payment flows. The quantity of reserves demanded then is typically interestinelastic, dictated largely by structural characteristics of the payment system and the monetary operating framework, particularly the reserve requirement. When reserves are remunerated at a rate below the market rate, as is generally the case, achieving the desired interest rate target entails that the central bank supply reserves as demanded by the system. In the case where reserves are remunerated at the market rate, they become a close substitute for short term liquid assets. Thus in either case the interest rate can be set quite independently of the amount of reserves and changes in stance of policy need not involve any change in this amount. The same amount of reserves can coexist with different levels of interest rates, conversely the same interest rates can coexist with different amount of reserves. In particular, while the sizes of banks balance sheets expand by the increases in reserves, all else equal, the lending decision for a bank is determined by the same marginal return condition as with the former method of monetary policy implementation. A loan is made at the margin if its return exceeds the marginal opportunity cost of reserves whether that is with the prior regime or the rate of interest on reserves as in the current regime. Apart from that, the balance sheet costs are also examined to determine the effect of level of reserves on the bank lending under this friction. Banks may have costs that are increasing in the size of their balance sheets because of agency costs or regulatory requirements for capital or leverage ratios. Thus the analysis shows that with these increasing costs, large quantities of reserves may surprisingly have a contradictory effect on bank lending. Perhaps, because of its novelty the large quantity of reserves in the banking system has generated a great amount of concern and debate. However there is little analysis of how reserves impact bank lending when interest is paid on reserves. The intuition is that the level of interest on reserves set by the central banks determines the marginal lending rate the banking sector charges to the real sector. In turn, the marginal lending rates determine the quantity of loans to the real sector. Since the interest paid on reserves is independent of the quantity, so too is the marginal bank lending rate. Thus the recent global financial crisis offers a stark example of the effect that variations in bank balance sheet strength, both perceived and real can have on the real economy. Going forward shifts in the willingness and the terms on which banks are prepared to lend, the way these manifest in movements in interest rate spreads are likely to be used for policy advice.

Macaroni Defense - A tactic used by a corporation that is the target of a hostile takeover bid involving the issue of a large number of bonds that must be redeemed at a higher value if the company is taken over.

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THE IBS TIMES MARKET WATCH

- KRITIKA SETHI

After a long tumultuous month, the world indices seemed to recover, though slightly. The Indian Stock markets displayed and upward movement to the tune of almost 7.3%. FII flows also picked up due to the positive sentiment of The European leaders devising policies to get the Euro Zone out of muddy waters. Further the Indian software outsourcing companiesâ&#x20AC;&#x; share prices began showing an upward movement owing to the anticipation of the Euro policies- their major business coming from the European countries. Coming to economic estimates, the Finance Minister Mr.Pranab Mukherjee lowered the GDP projection for the current fiscal to 7.5% from the grandiose figure of 8.75%,owing to a persistently high inflation and an overall slow economic growth. India's food price index rose 8 %, at its slowest pace in nearly 4 months, and the fuel price index climbed 15.53 % in the year. In the previous week, annual food and fuel inflation stood at 9.01 % and 15.49 %, respectively. Coming to the sectoral performances this week, metals were up 10.5% during the week followed by banking (up 8.0%). In fact, all the sectoral indices ended the week in green as broad based buying was witnessed across markets. Short covering was also witnessed in select oversold sectors resulting in sharp appreciation. Oil & Gas stocks were up 6.5% with the power sector recording a gain of 6.2% during the week. However, consumer durable stocks closed the week on a flattish note. The Movers & Shakers of the Week:

SURGES

%Change

DOWNFALLS

%Change

HINDALCO

15.4

KOUTONS RETAIL

-8.4

SBI

14.5

OPTO CIRCUITS

-6.8

EDUCOMP SOLUTIONS

14.3

ALSTOM PROJECTS

-5.4

The Divestment Department is seeking views of various ministries if buy-back of shares could be a feasible option for mopping up resources from cash rich public sector entities such as Coal India, National Thermal Power Corporation (NTPC), Oil and Natural Gas Corporation (ONGC), Oil India and National Mineral Development Corporation (NMDC Ltd).With the last date for payment of advance tax drawing closer, pressure is mounting on the Reserve Bank to cut Cash Reserve Ratio (CRR) by at least 0.25 percentage points to improve liquidity in the system. Such a move to lower CRR will result in release of about Rs 15,000 crore into the system. By 2012 we could witness a new line of SUVs and MUVs being launched by Maruti Suzuki India. This will help the company regain its 50% market share which has taken a beating with the recent strikes and loss in production that the company had to deal with at their Manesar plant. The Reserve Bank of India (RBI) approved creation of a separate category of non-banking financial companies for the MFI sector and specified that such institutions need to have a minimum net owned fund of Rs 5 crore, while for those operating in the North-Eastern states the slab has been kept at Rs 2 crore. The RBI in its second quarter policy review in October had approved setting up of this category of specialised financial companies which would cater to low-income groups. Global Cues: Equity markets are on track to record their best week in at least two and a half years as hopes of a deal to resolve the eurozone debt crisis take hold.The FTSE Eurofirst is 1.5% higher, eurozone bond yields are falling, and the euro is flirting with the USD 1.35 mark. Further, risk comes from US employment data, which could briefly overshadow the eurozone crisis. Some fear that markets are now primed for disappointment when the US releases its non -farm payrolls report, the most closely watched data point in global financial markets. The S&P 500's Relative Strength index, a closely watched meas-

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THE IBS TIMES MARKET WATCH 28 NOVEMBER 2011

29 NOVEMBER 2011

30 NOVEMBER 2011

1 DECEMBER 2011

2 DECEMBER 2011

Sensex

16,167.13

16,008.34

16,123.46

16,483.45

16,846.83

Nifty

4,851.30

4,805.10

4,832.05

4,936.85

5,050.15

DJIA

11,523.01

11,555.63

12,045.68

12,020.03

12,019.42

HangSeng

18,037.81

18,256.20

17,989.35

19,002.26

19,040.39

FTSE100

5,312.76

5,337.00

5,505.42

5,489.34

5,552.29

Gold ($/oz.)

1708.30

1722.30

1746.80

1743.00

1745.30

Crude($/bl)

108.75

109.74

110.38

109.41

INR v/s USD

52.40

52.26

52.27

51.85

51.50

INR v/s EURO

69.85

69.70

69.85

69.80

69.32

- FIGURES NOT AVAILABLE

Macaulay Duration - The weighted-average term to maturity of the cash flows from a bond, where the weights are the present value of the cash flow divided by the price.

BUSINESS JARGONS BY– ANKIT SHARMA

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DisclaimerThis newsletter is just a compilation of news from various sources. Thus, readers are expected to cross-check the facts before relying upon them. Though much care has been taken to present the facts without error, still if errors creep in, necessary feed back will be always welcomed. Editors will not be responsible for any undertakings. The newsletter is not meant for sale and hence, no part of the newsletter should be used without the prior permission of the editorial team.

SourcesThe Economics Times, The Hindu Business Line, Times of India, Business Standard, Financial Ex-press, Financial Times, Business Week, Business World, The Economist, Wall Street Journal, Bloomberg, Reuters, Moneycontrol.com, Vccircle.com, yahoofinance.com, Business Today, India Today, Investopedia.com, Wikipedia.com, DNA, The Deccan Chronicle, The Hindu, The Tele-graph.

EDITORIAL TEAMAKSHAY AGARWAL, ANKIT SHARMA, AVLEEN KAUR SARNA, DEVANSHI PODDAR, KRITIKA SETHI, POOJA DALAL, SHILPI KALWANI, SWATI VERMA.

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