Indian Economy - News & Discussion Oct 12 2013

somnath · Post by **somnath** » 24 Aug 2015 12:53

In general, also expect some coordinated central bank action. Street is already talking about a postponement of the Sep rate hikes from the US Fed. A volatile financial market acts as no one's friend (except trading floors of banks).

gakakkad · Post by **gakakkad** » 24 Aug 2015 13:08

how do you affect ease of doing business, without simplifying taxation and land acquisition ?

Modi has succeeded in redirecting lpg subsidies more than others..They say that everyday 30k customers are giving up subsidy..A miracle...

Hari Seldon · Post by **Hari Seldon** » 24 Aug 2015 13:10

Keynesian spending bulges sound nice.

Helps also that even basic infra in large parts of the country are sub-par. GoI has given enough indications about its thinking in this regard - focus on high RoI infra such as toilets in govt schools on the one hand to smart cities high-octane urbanization on the other - promoting everything in between: from roads, ports, rail to power gen (solar is big) to waterways development under a PPP model of some sort or the other.

Takes phenomenal patience and nerve to approach investors again after the way the last govt burnt them using the I-T dept, the environment ministry, multiple discordant noises and voices, and then the consent+social impact clauses in the land bill designed to smother business essentially. The NAC went ahead and passed more entitlements as law (RTE, RTF, NREGA etc) or as promises (e.g., pay commissions, OROP) which haven't been budgeted for - essentially poison-pilling and scorch-earthing the economy for the next govt....

The resulting bloat in the fisc deficit has been a persistent cause of high inflation. Fact that the UPA seemed dismissive about its risks (there was talk of diluting FRBM, for instance) further eroded market confidence and fuelled more viciousness in the inflationary cycle.

The smart city thing alone has enough potential to whet many investor and vendor appetites - from construction giants to steel magnates to services titans. Only.

Execution is key now. Lot of that lies with the states too. Helps that lots of states are NDA states now. Will have to wait and see how the execution part goes. Modi does come with some record on that front. One thing is clear however, expect no good news to come up in our mainstream (angrezi) media - whether print or electronic. Their bias is pavlovian. Only.

Austin · Post by **Austin** » 24 Aug 2015 13:26

Will DOW get impacted today due to China/India ?

Yagnasri · Post by **Yagnasri** » 24 Aug 2015 13:31

Most of the infra projects of UPA times particularly the big ticket ones are not financially viable. So leaving them to private parties means NPAs for banks. Even back of the envelop figures show that. Further already huge diversions have taken place to pay the political leaders in Con Mafia states. Promoters of these projects are unwilling to rectify situation as there is no fear to them at all.

The mess is quite bad and continuing.

Sensex fell 1200 points today so far. All is well now.

somnath · Post by **somnath** » 24 Aug 2015 13:37

gakakkad wrote:how do you affect ease of doing business, without simplifying taxation and land acquisition ?

Modi has succeeded in redirecting lpg subsidies more than others..They say that everyday 30k customers are giving up subsidy..A miracle...

Land acquisition is NOT a key bottleneck for stalled projects. MoF in a recent RTI response reported only 8% of projects being stalled on account of land acquisition. The single largest reason, ~40% of projects, is economic reasons, ie, people either not having enough capital or the business case being substantially weak.

GST, in its current form agreed by the Select Committee of Parliament, would not bring too much benefit, and might end up being inflationary at the margin. They have agreed to exclude tobacco, Petroleum products and alcohol - the 3 biggest revenue earners for the govt, both state and centre. With such large exclusions, the "revenue neutral" GST rate will need to be high in order to keep govt revenues largely intact, pushing up prices (especially services which will bear the brint of the higher tax rate. Further, the entire chain of credits on GST at progressive levels, get distorted. PLUS, they have allowed states to impose an additional 1% (to compensate so-called "producing" states, as GST is levied progressively on points of consumption of the good/service). This further distorts the architecture.

All in all, GST was supposed to be one, non-discriminatory unified rate that cuts through the country. The benefits were because it would be simple to administer and lower the average overall rate of taxation. With so many exemptions and discretionary rules, the axiomatic principles are no longer valid.

The "ease of doing business" principles - taking the World Bank index a proxy, is largely about adminstrative efficiencies - approvals, property registrations, contract enforcement, bankruptcy codes etc. Some of them will require legislative changes, but a lot of it could be simply plain administrative elan.

kvraghav · Post by **kvraghav** » 24 Aug 2015 13:58

^^
Land Acquisition is not for private project. Its more to do for government infra and irrigational projects. A single dam project will take more land than 5 or 10 industrial areas.

gakakkad · Post by **gakakkad** » 24 Aug 2015 14:08

>>Land acquisition is NOT a key bottleneck for stalled projects. MoF in a recent RTI response reported only 8% of projects being stalled on account of land acquisition. The single largest reason, ~40% of projects, is economic reasons, ie, people either not having enough capital or the business case being substantially weak.

I have accessed the RTI file ... The 8% projects that were stalled due to land acquisition were more significant than those stalled by other reasons .. Because those were stuff like airports or larger manufacturing units...there were 30-40% projects in which no reason was given or the reason was mentioned as "unclassified" ...

I have uploaded the file here in this thread several months ago..u can see for yourself...

other thing is that those 1500 projects does not encompass the entire economic activity in the country...so that is not a comprehensive evidence against land acquisition ...

Land acquisition is such a tedious project .. And it is a big deterrent in itself against mega projects...

I have seen a survey of business executives (most probably in this forum only) before the 2014 elections , about the main deterrent in investing...and land acquisition was amongst the top reason...

somnath · Post by **somnath** » 24 Aug 2015 14:10

On tax reform, the govt can start off by making the real radical steps that are administrative in nature.

One, take out retrospective taxation from the statute - as of now they have only reiterated what Chidambaram had said in his time, "we shall not impose retro tax anymore". They havent taken it out of the books of law. Till that happens, another govt and/or another FM can well find out a fresh case.

Two, find a way to extricate themselves from the "black money" rhetoric they have gotten into. Thanks to the election-time noise, the new black money law has become one of the most draconian pieces of tax laws since FERA. Given the exclusion of NRIs from its ambit, we see an acceleration of "NRI-isation" of Indian business families. Its easy to get residencies in Aus, NZ, Singapore, even Malta - and Indian business families are doing that in hordes. Black money requires structural changes, not draconian tax laws.

Three, bring back the conversation on DTC, which has been put to sleep. This doesnt require states to concur. Revamp the entire architecture of direct taxes into a simplified, exemptions-free regime.

vina · Post by **vina** » 24 Aug 2015 14:12

Somnath wrote:The solutions hence will have to come almost exclusively in Keynesian terms, ie, higher public spending.

Why Keynsian mamu ji ? That is so JNU ding-dong like. They love it. It was used by their idols as well, the Chinese. See the Chinese Kakkoose example.

2008 --> U S in kakoose, Chinese did massive keynsian pump priming, pumped up railways and housing -- > All bust by 2014.

Then in 2014 , more Keynsian pump priming brainwave using "Peepur's power" , so use propah gandu mouthpiece to get everyone and his father in law , woman and mother in law to buy on margin. Market zoomed, close to 150 % or something , now has to sink back with a thud.

So median P/E of all Chinese stock is around 60 or so. So who can hold up that piece of turd ? No one. So there goes your latest Keynsian bubble and bust.

And you want to do more Keynsian Kakkoose in India after the NAC /Kangress did that in UPA II?

Singha · Post by **Singha** » 24 Aug 2015 14:22

is today a buying opportunity for indian stocks or one should wait for a while until it finds bottom?

I have some unused money in my brokerage a/c and could always use some gains.

vina · Post by **vina** » 24 Aug 2015 14:25

Singha wrote:is today a buying opportunity for indian stocks or one should wait for a while until it finds bottom?

I have some unused money in my brokerage a/c and could always use some gains.

Its got some ways to go down baby. Hang on.

somnath · Post by **somnath** » 24 Aug 2015 14:27

gakakkad wrote:I have accessed the RTI file ... The 8% projects that were stalled due to land acquisition were more significant than those stalled by other reasons .. Because those were stuff like airports or larger manufacturing units...there were 30-40% projects in which no reason was given or the reason was mentioned as "unclassified" ...

Not true. Here is the data.
http://scroll.in/article/725313/land-ac ... l-projects

http://indiaspend.com/wp-content/FinMin.pdf

Bulk of the "land acquisition" issues have been with govt projects. Privaet sector projects constitute a small minority - and many of them are malls and housing development types.

This is inspite of an overwhelming share of the pvt sector in the portfolio of stalled projects.

The Economic Survey had a full analysis on stalled projects and their distribution around reasons etc.
http://indiabudget.nic.in/es2014-15/echapvol1-04.pdf

In general, land acquisition isnt the top reason for any of the sectors (manufacuring, services etc). For private sector projects, it is not one of the top reasons for stalling. The common reasons are essentially lack of funds (promoter equity or bank financing), or clearances.

A_Gupta · Post by **A_Gupta** » 24 Aug 2015 14:29

Look at this rant against RR: https://sg.news.yahoo.com/biggest-threa ... nance.html

Arjun · Post by **Arjun** » 24 Aug 2015 14:59

^We need to look at percentage of projects stalled in terms of value. I think Ambit Capital had done an analysis a few months back which came up with a higher figure (15%) for land acquisition related stalling - but still not extremely substantial: http://www.business-standard.com/articl ... 794_1.html

Aditya_V · Post by **Aditya_V** » 24 Aug 2015 15:08

vina wrote:
Singha wrote:is today a buying opportunity for indian stocks or one should wait for a while until it finds bottom?

I have some unused money in my brokerage a/c and could always use some gains.
Its got some ways to go down baby. Hang on.

I think it depends sector wise, while almost all sectors are down, stocks Like GMR, Aban Offshore, Hindalco, Sail, Vedanta, Tata Steel are probably near the bottom. These stocks have already been discounted by the market for some time and were further beaten down today. I don't think these companies will shutdown so I doubt market will have much more room to hammer them.

IT, Motor Vehicles, FMCG, Pharma, Bank stocks are the ones which have rallied in the 6-7 years are the stocks which will probably lose a lot of value. For eg. Yes Bank, TCS(after considering bonus issue) Have moved up some 16 times from their lows in 2008. Similarly Maruti around 10 times from its lows in 2008.

srin · Post by **srin** » 24 Aug 2015 15:08

somnath wrote:
Two, find a way to extricate themselves from the "black money" rhetoric they have gotten into. Thanks to the election-time noise, the new black money law has become one of the most draconian pieces of tax laws since FERA. Given the exclusion of NRIs from its ambit, we see an acceleration of "NRI-isation" of Indian business families. Its easy to get residencies in Aus, NZ, Singapore, even Malta - and Indian business families are doing that in hordes. Black money requires structural changes, not draconian tax laws.

Can you please enumerate the specific parts that you find draconian ? As someone who now has to fill up ITR-2 section FA from this year on because of that law, I think the law is pretty reasonable. It only affects foreign assets and foreign income that can't be explained by known sources of income. So I'm curious to know what you don't like about it.

And if someone isn't interested in declaring their unexplained assets or availing of the amnesty scheme (getting off by paying a penalty), I wouldn't shed tears for them.

somnath · Post by **somnath** » 24 Aug 2015 15:10

^Plus, bulk of the stalled projects attributed to "land" are PSU - linked. There is an element of cognitive bias in reporting. Its rather embarrassing for the govt to admit project delays due to approvals (shows that left hand doesnt know what the right hand is doing), funding (shows that the govt announces the projects without adequate funding - reflects poorly on the ministers). Land acquisition delays are a "clean 3rd party blameless" reason to give, when it comes to the govt sector.

somnath · Post by **somnath** » 24 Aug 2015 15:26

srin wrote: And if someone isn't interested in declaring their unexplained assets or availing of the amnesty scheme (getting off by paying a penalty), I wouldn't shed tears for them.

One, it makes a tax law an exercise in coercive extraction (with stiff prison terms). If coercion was enough to unearth unaccounted for income, FERA, VP Singh and Indira Gandhi would have been the most succesfull tax collectors!

Two, it gives enormous discretion to Assessing Officers, essentially reversing a 2 decade long process of tax reforms where at least in theory, discretion was sought to be minimised.

Three, it reverses the movement of foreign income/asset disputes towards Civil (by replacement of FERA by FEMA) from criminal again (through the new black money law).

Black money and illegal activities are not co-terminus. A trader/entrepreneur not filing tax returns on his income (or filing depressed return numbers) has generated black money, but not committed a criminal activity.

Since 1991, one of the greatest achievements of reforms has been to make it easier for people to comply, and make tax assessment, dispute resolution and recovery a matter of civil discourse (as it is in most civilised countries). The new law reverses that trend, for an uncertain result.

vera_k · Post by **vera_k** » 24 Aug 2015 15:51

somnath wrote:^Plus, bulk of the stalled projects attributed to "land" are PSU - linked. There is an element of cognitive bias in reporting. Its rather embarrassing for the govt to admit project delays due to approvals (shows that left hand doesnt know what the right hand is doing), funding (shows that the govt announces the projects without adequate funding - reflects poorly on the ministers). Land acquisition delays are a "clean 3rd party blameless" reason to give, when it comes to the govt sector.

Obvious guy says that the only sector taking on projects where land acquisition is not completed already is the government

.

The private sector does not need to invest in projects within India where land is not fully acquired and deal with cost escalation due to inevitable land acquisition issues.

gakakkad · Post by **gakakkad** » 24 Aug 2015 15:51

here is the RTI itself

https://jumpshare.com/v/x5ZluilNmmgOgsvLgrXl

as u can see , the projects that are stalled by land acquisition are mega projects like airports.. Projects stalled by other reasons like finance etc are smaller projects like shopping mall or hoursing complex...Obviously stalled airport is a bigger loss than stalled apartment project...In fact all the airports in the list are stalled due to land acquisition...

real life (less abstract) analogy... A person eats 2 pizzas and 18 pieces of grapes per day... So cut down of Pizza will have more impact or the grapes ? obviously 2 pizzas have more calories than 18 grapes...Like wise 30 airports + mega projects have far bigger impact than 300 housing societies...

Aditya_V · Post by **Aditya_V** » 24 Aug 2015 15:58

To reiterate My point as of 30 June 2015, FII had 12.36% stake in Tata Steel, 16.72% in VEDL and 44.32% in Yes Bank. Looks like after today and previous sell off's, this group will not much ability to push down Metals but will start liquidating their portfolios in other sectors.

somnath · Post by **somnath** » 24 Aug 2015 16:11

gakakkad wrote:as u can see , the projects that are stalled by land acquisition are mega projects like airports.. Projects stalled by other reasons like finance etc are smaller projects like shopping mall or hoursing complex...Obviously stalled airport is a bigger loss than stalled apartment project...In fact all the airports in the list are stalled due to land acquisition...

Why dont you just see the reports linked above (including the MoF response to the RTI quesry? 8% of projects stalled by number, 15% by value are due to land issues. None are substantial numbers.

According to the Economic Survey, land isnt the top reason for stalling for ANY sector - manufacturing, mining or services. In the private sector, land isnt even one of the top 3/4 reasons for stalling.

vera_k wrote:Obvious guy says that the only sector taking on projects where land acquisition is not completed already is the government .

The private sector does not need to invest in projects within India where land is not fully acquired and deal with cost escalation due to inevitable land acquisition issues.

Doesnt happen that way. Promoters (barring Real Estate developers) dont first acquire land and then ask for approvals. Depending on the industry, prmoters need to first get project clearance (and requisite licenses) and then go in for land acquisition.

None of the stalled PSU projects are govt "take-overs". They are all public sector promoted projects - AAI airports (barring a few, airports are reserved for AAI), power plants promoted by state Gencos etc.

Last, cost of land is not an issue at all (barring in residential RE). For a typical industrial project, cost of land happens to be ~3-4% of the total project outlay. Even accounting for a doubling of land acquisition costs, the impact on project IRRs is marginal. The ostensible issue is of the time taken to acquire land - but as the data shows, it doesnt seem to be an issue for most pvt sector projects at all.

gakakkad · Post by **gakakkad** » 24 Aug 2015 16:34

^ the value of the stalled projects due to LAB is 70 billion dollars...not a trivial sum...

The stock of stalled projects at the end of December 2014 stood at 8.8 lakh crore or 7 per cent of GDP

About 8% of 804 industrial projects – with a planned investment of Rs 421,062 crore ($67.91 billion) – across India are in limbo because of land-acquisition problems, according to data released by the finance ministry.

That is more like 50 % and not 15%...(4.2 lakh crore/8.8 lakh crore= 47.7%) ...So it shows that of the stalled projects , the ones stalled by LAB had nearly 50% value..

so a project that is stalled due to LAB will be 7 times as valuable as those stalled due to other reasons...

other point is that many of the other factors (like lack of promoter interest , lack of market0 etc are non-actionable by the gov't...the govt can only act on clearances and acquisitions ..and if possible some financial reforms...

Theo_Fidel · Post by **Theo_Fidel** » 24 Aug 2015 17:51

Singha wrote:is today a buying opportunity for indian stocks or one should wait for a while until it finds bottom?

I have some unused money in my brokerage a/c and could always use some gains.

Its impossible to time the down so buy in small amounts all the way down. 10%-20% of your cash reserve. What ever you do don't sell.

Theo_Fidel · Post by **Theo_Fidel** » 24 Aug 2015 18:03

gakakkad wrote:here is the RTI itself

https://jumpshare.com/v/x5ZluilNmmgOgsvLgrXl

as u can see , the projects that are stalled by land acquisition are mega projects like airports.. Projects stalled by other reasons like finance etc are smaller projects like shopping mall or hoursing complex...Obviously stalled airport is a bigger loss than stalled apartment project...In fact all the airports in the list are stalled due to land acquisition...

G saar,

Thanx for the list. Fascinating reading. Other than GOI clearances and land problems, looks like major issue is lack of funds+lack of interest+market conditions.

Not sure how many of these projects are serious.
For instance Videocon - North Chennai Thermal Power - Rs 3000 Crore. This project was taken over by TANGEDCO and completed a few years back. So not sure what that is all about.
Hassan Airport - Rs 3000 crore??
GVK - ~ 50,000 Crore of projects - The company has Rs 30,000 crore in debt and is barely surviving, most think bankruptcy is around the corner.

I saw several more projects that made me scratch my head. Looks like more of a Babugiri list if you ask me.

chola · Post by **chola** » 24 Aug 2015 18:04

Theo_Fidel wrote:
Singha wrote:is today a buying opportunity for indian stocks or one should wait for a while until it finds bottom?

I have some unused money in my brokerage a/c and could always use some gains.
Its impossible to time the down so buy in small amounts all the way down. 10%-20% of your cash reserve. What ever you do don't sell.

Get a sense of the drop and buy Sensex linked funds. Don't worry about individual stocks. The market is viable. Eventually it will bounce back. The issue now is the foreign fund managers panicking across the board for all emerging markets. It has NOTHING to do with the fundamentals in the Indian economy.

That said, draining of the foreign money from a third world market like Mumbai is traumatic. It will get ugly. But once the hot money had liquidated itself, we WILL climb back up. The best way to ride this is through the index. The index will never get wiped out completely unlike individual stocks.

vera_k · Post by **vera_k** » 24 Aug 2015 18:09

somnath wrote:Doesnt happen that way. Promoters (barring Real Estate developers) dont first acquire land and then ask for approvals. Depending on the industry, prmoters need to first get project clearance (and requisite licenses) and then go in for land acquisition.

Correct. And barring those getting sweetheart deals that promise outsize returns, why waste time on the paperwork if the land is going to be a problem later on? These projects don't show up in the data, because they never even get off the ground.

Chandragupta · Post by **Chandragupta** » 24 Aug 2015 18:30

Picklu wrote:A few observations:

1. Today when my car was delivered after service in bangalore, kerala, the driver brought the portable credit card machine with him so that i do not have to give him large amount of cash for him to carry back.
2. The card reader will work as long as mobile network is working. If mobile network is not present, those mobile wallets will not work either.
3. For last couple of years, those cash teller machines and credit/debit card reading POS machines are available even in make shift vegetable shops (temporary shade built over empty 30X40 plots in the neighbourhood)
4. Almost every vegetable shop owner/kiranawala carries a smart phone today; heck even the boys in local barbershop & pet shot carries one. All the delivery boys of various e-commerce cos also carry one and take the signature in tough screen post delivery. So does the drivers from the cab cos. Given the reducing price of smartphone, the rural folks can easily afford one; it is the mobile network that is the bottle neck.
5. Recently I found many local business have started using the small credit card reader attached to the smart phone. If that works out, it will reach rural areas quite easily along with the smart phone. All the gov need to do is to ensure that reliable mobile network reaches every corner of the country.

As far as mobile wallet is concerned, Airtel money is there for quite some time and so is iMobile from icici. paytm is there piggybacking on uber (or is it the other way round?). Most of the reward cards like payback etc are tagged to phone no and to redeem you do not really need the card. I have used the most but use case is quite different from plastics.
While doing m-commerce via ola, uber, amazon, flipkart, bookmyshow, bigbasket or myntra etc, it is quite ok to use your mobile wallet. Also IMPS is very good in terms of instantaneous money transferring between bank accounts. But all these happens when you are already in the virtual world via phone or computer for doing the main transaction (booking ticket, purchase or money transfer). Also, unless you are absolutely forced to, you may still prefer to use your saved credit card instead of using a mobile wallet which is an additional layer on top of your card only.
When you are in brick and morter, swiping your credit card and typing the pin is still much easier than using the mobile wallet and I do not see much traction of mobile wallet unless the other option is cash only.

Are people in the rural areas really using devices like Square? Around 30 crore people hold debit or credit cards in India but I'd like to know how many use it or what is the annual transaction per user per year. If someone has an idea please let me know.

It is definitely easier to use a card in a brick & mortar store instead of a mobile wallet simply because of the steps involved. This is something I don't think will change unless mobile wallet companies change the way a customer pays - perhaps generating QR code on a screen after the bill is punched in, the customer can scan it, authorise the payment but still cumbersome than swiping the card.

Not sure if NFC is the answer. Isn't Android's security a suspect? I would assume it will be very easy to tap into an Android smartphone for a seasoned hacker & empty the wallet, wouldn't it be?

You're bang on with the opinion that m-wallet will mostly lead when it comes to m-commerce because you're buying & paying on the same platform.

gakakkad · Post by **gakakkad** » 24 Aug 2015 19:38

indeed theo saar...lot of it is funny.. I mean why would hotels remain uncleared due to environment ? I mean , I know there was the Jayanthi problem...but did hotels seriously need env clearance ?

member_20292 · Post by **member_20292** » 24 Aug 2015 20:03

chola wrote:

That said, draining of the foreign money from a third world market like Mumbai is traumatic. It will get ugly. But once the hot money had liquidated itself, we WILL climb back up. The best way to ride this is through the index. The index will never get wiped out completely unlike individual stocks.

In India, mutual funds perform better than the index, unlike in the US - since managerial standards differ widely.

Supratik · Post by **Supratik** » 24 Aug 2015 20:10

1 lakh crore of investment proposal in electronics manufacturing (mainly phones) over last one year, 80% in last two months. All major global and local companies involved. Source SSC.

nandakumar · Post by **nandakumar** » 24 Aug 2015 20:14

gakakkad wrote:indeed theo saar...lot of it is funny.. I mean why would hotels remain uncleared due to environment ? I mean , I know there was the Jayanthi problem...but did hotels seriously need env clearance ?

Under the Environment Protection Act all projects with investment in excess of 100 crore need clerance or as they say, Jayanti tax!

TKiran · Post by **TKiran** » 24 Aug 2015 20:16

Theo_Fidel wrote:
Singha wrote:is today a buying opportunity for indian stocks or one should wait for a while until it finds bottom?

I have some unused money in my brokerage a/c and could always use some gains.
Its impossible to time the down so buy in small amounts all the way down. 10%-20% of your cash reserve. What ever you do don't sell.

As a layman I would think of selling half my stock tomorrow as I am certain that I can buy them back at least 20% less after a week and with that saved 20% money I would buy an apple as I did not make any transactions in stock markets in the last 1year (so no need to pay long term capital gains tax). Does it make sense or am I being too smart that I may not buy the froot and end up loosing my shirt? My portfolio is worth Rs. 3 lakhs right now.

Theo_Fidel · Post by **Theo_Fidel** » 24 Aug 2015 20:20

TKiran wrote:As a layman I would think of selling half my stock tomorrow as I am certain that I can buy them back at least 20% less after a week and with that saved 20% money I would buy an apple as I did not make any transactions in stock markets in the last 1year (so no need to pay long term capital gains tax). Does it make sense or am I being too smart that I may not buy the front and end up loosing my shirt? My portfolio is worth Rs. 3 lakhs right now.

At that point you are speculating not investing. What has changed about the company or market sector to make you sell?
----------------------------

Sometimes this is a good time to re-balance your portfolio. But you need some real cojones of steel to do this at this point. You will have to sell your stronger stocks, say the ones with 5% decline and buy the major losers of 20% or so decline. Personally don't have such cojones so I let it ride....

TKiran · Post by **TKiran** » 24 Aug 2015 20:31

Most of my portfolio is 'blue chips'. I invested 2 lakhs some 18 months ago. It was 4 lakhs a month ago. But as u said I don't understand stock markets so I just see my portfolio and

now I thought I can act smart. But I dont know

Singha · Post by **Singha** » 24 Aug 2015 20:36

also all projects > 100 acres needed approval from delhi based env ministry incl real estate projects who had to go to delhi and present their case repeatedly. might have been pushed back to state pollution control board now...

Vayutuvan · Post by **Vayutuvan** » 24 Aug 2015 21:12

Theo_Fidel wrote: Personally don't have such cojones so I let it ride....

I did that sometime in 2001. Lost $50K and taxman advised to sell and write off losses to eke out a little fraction from IRS.

Vayutuvan · Post by **Vayutuvan** » 24 Aug 2015 21:13

TKiran:

"There are two times in a man's life when he should not speculate: when he can't afford it and when he can." - Samuel Clemens AKA Mark Twain

srin · Post by **srin** » 24 Aug 2015 21:53

Actually, the Nifty PE was quite high (see here for one analysis), so a reversion to mean was always on the cards.