Coal Resources in India: Are they enough to power our growth?

Economic growth of a nation critically depends on availability of energy, and coal is the main source of energy in India. Some key facts about our coal resources are given below-

• India has the world’s third largest coal reserves in world
• The assessed resources of coal stand at 298 billion tonnes which are expected to last for about 102 years at current rate of use
• About 65% of our electricity is generated by coal
• The majority of coal produced is consumed by the power sector–over 75%
• India’s largest coal producer Coal India produced over 557 million tonnes in 2012-13, but still it imported about 80 million tonnes as it could not produce enough
• To increase production a number of new projects are planned to be taken up in PSU coal companies and a number of coal blocks are being allocated to various private and government companies
• With a view to infuse competition in the coal sector it has been proposed to take up the exercise of restructuring of Coal India Limited

For more research updates please visit:- http://www.rrfinance.in

Indian debt market has witnessed a better inflow!

Indian debt market has witnessed a better inflow with foreign institutional investors pumping in a record Rs 1, 12,469 crore ($18.6 billion) in the debt market till date in 2014.

With RBI governor Raghuram Rajan’s main focus now on containing inflation, bond dealers do not see any immediate cut in key policy rates which could have directly brought down the benchmark yield on the 10-year government securities from the current level of about 8.50%.

Bond market players expect that given strong demand for gilts form FIIs, the government may now increase the $25-billion limit and bring down the limit for corporate bonds. If that happens as more FIIs rush to buy gilts, prices will rise and yields will soften

Market Outlook

The Indian rupee appreciated over 6% in the beginning of 2014 due to huge foreign investment in the country’s debt and equity market. This rally was led on the hopes of a strong and stable government to revive the Indian economy. However the trend for the INR has reversed in last 2 months. The risk factors for the Indian rupee include high inflation, Middle East crisis, low percentage of forex reserves/external debt, and Fed tapering.

The foreign investors have high expectations from the ruling government. If these expectations are not met, then the Indian rupee is likely to depreciate further. Talk of volatility in the currency market and issues surrounding capital flows are back. The Indian rupee depreciated over 3% against the US dollar between 2 July and 6 August.

Last year, Indian markets witnessed high volatility after the Fed indicated for the first time that it will reduce the quantum of asset purchase, popularly referred to as tapering. Foreign investors sold Indian assets (equity and debt) worth over $12.5 billion in three months to August. Experts are of the view that markets may be subjected to volatility as the US central bank ends its asset purchase programme, but it will not be at the same scale as witnessed last year.

Indian rupee has witnessed some volatility and inflows from foreign investors in the equity markets have slowed, while the debt market has seen net selling in the current month. It is always difficult to prejudge the extent and timing of the way policy decisions will affect global financial markets and to what extent Indian markets will be affected.

However, irrespective of the way things pan out in the global financial markets, investors in India will draw comfort from the fact that compared to last year, fundamentals have improved and the outlook on Indian markets is positive.

Read detail report here:- http://www.rrfinance.com/reserch/pdf/other-pdf/Debt_Fortnightly.pdf

DSP BLACKROCK 3 Years Close Ended Equity Fund

The primary investment objective of the Scheme is to generate capital appreciation by investing predominantly in portfolio of equity and equity-related securities.

The fund will invest in Micro, Small and Midcap companies with an aim to capitalize on the Indian growth story.

Key reasons to invest in this fund:

• Experienced investment team
• Robust risk and quantitative analytics
• Long track record of Fund Manager

For more information please visit: http://www.rrfinance.in

Save Tax upto Rs. 45,000 : Invest in Mutual Fund ELSS

What is an ELSS?

This is an equity diversified fund and investors enjoy both the benefits of capital appreciation, as well as tax benefits. An ELSS – Equity Linked Savings Scheme is like a Diversified Equity Fund. It is a type of mutual fund that qualifies for tax exemption under section 80C.

ELSS is an equity oriented mutual fund scheme in which the majority corpus (about 80-100%) is invested in equities. As the allocation is done in equity which are considered as high return assets, the primary aim of such funds is capital appreciation. It has a 3 year lock in period.

Advantages of Mutual Fund ELSS Schemes over other tax saving instruments

1- Income Tax Benefit under section 80 C.

2- Bright Chances of much Higher Returns.

3- Bright chances of Tax free Dividends.

4- Returns are fully exempted from Tax.

5- Relatively shorter lockin period of 3 years.

6- Dividends are Tax Free.

For more information please visit:- http://www.rrfinance.com/Maillers/elss_oct301.html

Oil: Why Prices are Falling!

Crude oil has dropped to its 4-year low, and the trend is still downward. We are mentioning here the main factors driving down the oil prices –

Jump in US Oil Production: US oil production has jumped by over 70% since 2008 which has caused a huge supply glut in markets forcing prices downward.

Lower Demand: Europe, Japan, and much of the developing world is facing slowing of economies leading to lower oil demand.

No Production Cut by Saudi Arabia: Saudi Arabia is maintaining the same oil production level in spite of a fall in demand and prices; this has added further pressure on oil prices.

RECOMMENDATION:

Falling oil prices are strongly favorable to India. We recommend investments in equity mutual funds at every correction.

Resource by:- https://www.linkedin.com/today/post/article/20141017110620-247646391-oil-why-prices-are-falling

Why Mutual Funds ?

A mutual fund is a professionally managed collective investment scheme that pools money from many investors for the purpose of investing in securities such as stocks, bonds, money market instruments and similar assets.

1. Professionally managed and transparent
2. Optimization of returns to suit goals
3. Well diversified portfolio
4. Convenient and flexible
5. Anytime liquidity to investors

Planning for Retirement

Mutual fund houses are a good option for investors who are looking to plan for their golden years.

An individual, during his per-retirement years should set clear goals (as early as possible), which must be translated into numbers.

Retirement goals for long and happy life can be easily achieved if savings are mutual funds.

Power of Systematic Investments (SIP)

Systematic Investment Plan (SIP) is a smart financial planning tool that helps you to create wealth, by investing small sums of money every month.

1. Averaging of investments reduce risks.
2. Can be started with small amounts.
3. Timing on long term basis optimized.
4. Long term goals are easily achievable.

Magic of Compounding

INR 10,000/-invested every month for 10 years at 12% compound interest rate becomes INR 23,23,390.76/-.

INR 25000/-invested monthly for 10 years become INR 58,08,476.91/-.

You can use long term investments to achieve financial goals, such as becoming a millionaire, retiring comfortably, or being financially independent.

Why RR?

1. A 27 year’s old trusted brand
2. Professional & unbiased advice
3. Single platform for all mutual fund schemes available in India
4. Fully secured online transactions directly with mutual funds
5. Allows you to manage your Investments and savings confidently

For more information please call us 1800110444 or visit: http://www.rrfinance.in

Foreign portfolio investors (FPIs) had acquired $16.7 billion!

1. Foreign portfolio investors (FPIs) had acquired an additional $16.7 billion worth of bonds in the country during 2014, after netting for sales. This near-eight-month record compares with net sales of bonds totaling $8 billion in 2013 and net purchases of $6.6 billion in 2012.
2. With RBI governor Raghuram Rajan’s main focus now on containing inflation, bond dealers do not see any immediate cut in key policy rates which could have directly brought down the benchmark yield on the 10-year government securities from the current level of about 8.50%.
3. Bond market players expect that given strong demand for gilts form FIIs, the government may now increase the $25-billion limit and bring down the limit for corporate bonds. If that happens as more FIIs rush to buy gilts, prices will rise and yields will soften.

Market Outlook

The Indian rupee appreciated over 6% in the beginning of 2014 due to huge foreign investment in the country’s debt and equity market. This rally was led on the hopes of a strong and stable government to revive the Indian economy. However the trend for the INR has reversed in last 2 months.

The risk factors for the Indian rupee include high inflation, Middle East crisis, low percentage of forex reserves/ external debt, and Fed tapering. The foreign investors have high expectations from the ruling government. If these expectations are not met, then the Indian rupee is likely to depreciate further.

Talk of volatility in the currency market and issues surrounding capital flows are back.

The Indian rupee depreciated over 3% against the US dollar between 2 July and 6 August. Although it has recovered some ground, foreign investors have been net sellers in August. Net selling in debt market by foreign investors in August has been to the tune of $709.17 million so far, while the net buying in equity market is only worth $166.55 million. In July, foreign investors invested $1.93 billion and $3.83 billion in equity and debt market, respectively.

Last year, Indian markets witnessed high volatility after the Fed indicated for the first time that it will reduce the quantum of asset purchase, popularly referred to as tapering. Foreign investors sold Indian assets (equity and debt) worth over $12.5 billion in three months to August.

Experts are of the view that markets may be subjected to volatility as the US central bank ends its asset purchase programme, but it will not be at the same scale as witnessed last year.

Indian rupee has witnessed some volatility and inflows from foreign investors in the equity markets have slowed, while the debt market has seen net selling in the current month. It is always difficult to prejudge the extent and timing of the way policy decisions will affect global financial markets and to what extent Indian markets will be affected. However, irrespective of the way things pan out in the global financial markets, investors in India will draw comfort from the fact that compared to last year, fundamentals have improved and the outlook on Indian markets is positive.

Source by:- http://www.rrfinance.com/reserch/pdf/other-pdf/Debt_Fortnightly.pdf

GOLD – Don’t buy to invest because it is cheap!

We had mentioned in our research note dated 25th May 2014, that gold is bearish as long as it remains below 28800. If support of 25000 is broken, gold may fall to 18000 in the next two years. (Please click here to read)

We reiterate our views that gold is in long term bearish trend as long as it remains below 28800. It has its next support at 26000 and if that is broken, it will test its most important support at 24,000 which is a 38.2% Fibonacci level.

A decisive breach of this support will indicate a major bearish fall. Gold can then tumble up to 18000 by year 2015 – 2016. Gold may be purchased on dips for jewellery but incremental investments of investible funds should be made in equity or debt for long term returns.

Improving global economies and falling risk are taking away the investors from investing in this perceived safe asset.

Source by:- https://www.facebook.com/notes/rr-financial-consultants/gold-dont-buy-to-invest-because-it-is-cheap/837518252949341

MARKETS: Expect a Big Chinese Investment Booster next week!

Chinese premier Xi Jinping’s visit to India next week will see several big announcements of investment in Indian industries. China, which has more than $4 trillion in foreign exchange reserves, plans to invest $500 billion overseas in the coming years. In the last 14 years, China has invested only about $0.4 billion in India, contributing just 0.18% to overall FDI inflows.

Highlights of expected investments are outlined below–

• Investment areas include – bullet trains, industrial parks, twin city projects, energy sector, food security, culture, tourism, and film industry.
• More than $7 billion in industrial parks in Maharashtra and Gujarat
• MOU to develop India’s railway infrastructure
• More than 20 Chinese companies will sign purchase agreements with Indian companies worth $650 million
• Indian government wants China to reduce the trade deficit by allowing easier imports of IT, pharma and farm goods and manufacturing of hi-tech and electronic goods in India.
• China has shown a renewed interest in winning road-building contracts. Road ministry feel India can harness Chinese capabilities to improve its infrastructure, including construction of high-quality highways, expressways etc.

Now with Japan announcing its plans to invest about USD 35 billion in the next five years in India, it will be interesting to see how China plans its investments.

This visit from 17th September next week should prove to be a big positive for the markets.

RECOMMENDATION:

Several midcap, small-cap, and infrastructure stocks have not appreciated, offering excellent opportunity to investors to enter at current levels. Some slow moving cyclical stocks may surprise the markets.

The markets still offer opportunities for medium to long term investors in Equity Mutual Funds.

Source By:- http://goo.gl/7J8EPL

Why invest in SBI EQUITY ?

SBI Equity Opportunities Fund-Series 1 has following reason to invest:-

Macro indicators:

Improving macro indicators leading to better economic growth prospects and improved market sentiments.

New Government:

Stable government with clearly articulated policy framework and pro-growth approach will lead to enhanced economic activity in India.

Investment Themes:

Potential opportunities arising from structural trends like home improvement, e-commerce, imports substitution & manufacturing exports, defense, education etc.

Investment Management:

Robust stock selection process, tested in various market conditions has potential to identify growth stocks at reasonable valuations.

Market Opportunity:

Opportunities across market capitalization with bias towards mid and small caps to generate value for investors in next 3 years.

For more information please visit:- http://www.rrfinance.com/Maillers/sbi.html

Buy Online Mutual funds here :- http://www.rrfinance.in