Niveshak April 2014 Issue with Page Flip version
Sunday, May 18, 2014 , Posted by Team Niveshak at Sunday, May 18, 2014
Dear Niveshaks,
While the whole country is gripped in the poll fever, we bring to you a fresh new edition of Niveshak. The month of April started with The Reserve Bank of India (RBI) granting two preliminary licenses to IDFC Ltd and Bandhan Financial Services to set up new banks in a country where only one household in two has access to formal banking services. RBI Governor Raghuram Rajan said that banking licenses will be an on-tap facility, meaning the central bank will keep issuing new licenses to applicants it deems fit as and when required.
While the whole country is gripped in the poll fever, we bring to you a fresh new edition of Niveshak. The month of April started with The Reserve Bank of India (RBI) granting two preliminary licenses to IDFC Ltd and Bandhan Financial Services to set up new banks in a country where only one household in two has access to formal banking services. RBI Governor Raghuram Rajan said that banking licenses will be an on-tap facility, meaning the central bank will keep issuing new licenses to applicants it deems fit as and when required.
Another major event was Sun Pharma’s
acquisition of Ranbaxy Laboratories, in a landmark $4-billion transaction,
which marks the coming together of two major Indian pharmaceutical companies to
create the world’s fifth-largest generic drug maker by sales. The all-share
deal, the biggest in the pharmaceutical sector in the Asia Pacific region this
year, is seen as a rare purchase of a local rival by a leading Indian company.
The erstwhile ‘king of good times’, Vijay Mallya, may now lose his Kingfisher
brand. Lenders have started the process of selling brands associated with the
grounded Kingfisher Airlines (KFA). And the ones up for grab include
‘Kingfisher’, ‘fly the good times’ and ‘flying models’. On the international
front, Vic Gundotra, the high-profile Indian executive who headed the Google+
team at Google, is leaving the company. Apart from being the man behind
Google+, Gundotra was instrumental in making Google I/O, company’s annual
conference for developers a success. But, the biggest happening in the country
right now is going on in regards to the 16th Lok Sabha Elections, the world’s
largest election. Every major party is busy doing campaigning for elections and
all the citizens are busy contemplating whom to give the hot seat for the next
5 years!!
As we move ahead with our initiative
of Niveshak Investment Fund (NIF), the portfolio has shown a favorable growth
trend, outperforming the market. A detailed report inside summarizes the
overall performance of the fund for this month. The Article of the Month this
time is “2016: A bubble waiting to burst?” which intends to address the recessions
that occurred in the US economy and their global impact and then identify a
pattern followed by business cycles. Our Cover Story for this month “Banking
Licenses” analyses the various aspects related to the new banking license and
what effects it will have on the Indian banking sector. FinGyan section of
this edition elaborates on “Behavioral Approach To Understand US 2008 Crisis”.
FinSight article “CAPM- Telecom” shows computation of cost of equity for
different valuations in the Telecom sector derived by different values over
different spans of time. The FinPact article “The Vodafone – Hutchison Essar
Deal” tells about one of the biggest telecom M&A deal for India. Not only
was this one of India’s largest foreign takeovers, this deal also attracted an
unprecedented array of blue-chip legal teams from India and abroad. This time,
the FinView section has the excerpts from our interaction with Mr. Jaydip
Mukhopadhyay, ERS Manager at Deloitte & Touche LLP. He gave us many useful
insights into the risk management sector. The Classroom section this time
throws light on the famous term of “Chinese Wall”.
We would like to thank our readers for their
immense support and encouragement. You remain our prime motivation factor that
keeps our spirits high and gives us the vigor and vitality to keep working
hard. Thank you.
Stay invested!
Team Niveshak
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