Infosys hit its 52-week low at Rs 1,065 per share,

Wipro, Rs 196.50; TCS, Rs 358;

HCL Tech, Rs 89.70; and

Cognizant’s low was $17.37 on the Nasdaq.

This was at a time when companies were reworking on their operational strategies, optimising costs and embarking on rationalisation measures, even sending people back home. The writing is on the wall: India’s vaunted technology companies must upgrade their business model or face dwindling profits and market share.

For years, India’s top six software companies (sometimes referred to as SWITCH: Satyam, Wipro (WIT), Infosys (INFY), Tata Consultancy (TCS.BO), Cognizant (CTSH), HCL) have roiled global IT markets with their high-quality, low-cost software and tech-related services. They gave India a new hope, and their success became the accelerator for the country’s growth. Companies such as IBM, Accenture, and Electronic Data Systems (EDS), which ruled the roost with their high-end offerings, saw business slip away to the Indians. SWITCH seemed unbeatable, especially as the group grew in sophistication. On the back of bagging major deals from large clients in the US, share prices of these companies are back ruling the roost. On Thursday,

Infosys scaled a new 52-week high at Rs 2,600.

HCL Tech at Rs 373.30 is hovering near its annual high of Rs 377.

And TCS isn’t too far from its peak of Rs 805 when it closed at Rs 746.80 on Thursday.

This euphoria is not restricted to Indian companies. IBM and Cognizant too are trading near their 52-week peaks. IBM is trading at $130 against a 52-week low of $80.52, Cognizant which has a large India presence, is trading at $46.25 against its year low of $17.37.The most immediate crisis is the U.S. economic downturn. Over the years, the Indians have grown less dependent on America as their main market and have expanded business to Europe, Japan, and other parts of the world. But they’ve neglected their home turf. According to a study by Everest, the Indian domestic tech market is currently worth just $1 billion but will be valued at $15 billion within five years. That’s a massive opportunity, not just in terms of money but for innovation

IS SUZLON ENERGY A GOOD BUY ?

Hansen Transmissions is a leading global player in manufacturing wind gear boxes.

Suzlon, based in the western city of Ahmedabad and controlled by billionaire Tulsi Tanti, announced in June it would sell all or part of its holding in Hansen to reduce debt.

Suzlon currently holds 92% of REpower but under German law must buy out the remaining shareholders in order to exercise full control and integrate the two companies. At the current value of REpower’s shares, 8% of the company would cost approximately $150 million, Mr. Sinha said, though a German court must approve the price Suzlon pays to the shareholders. A REpower spokeswoman declined comment.

Suzlon, which is based in the city of Pune and was founded by Indian entrepreneur Tulsi Tanti, was once a high-flying wind firm with aspirations to combine India’s cheap manufacturing with technological know-how to establish a global wind-turbine powerhouse. Its ambitions have been blown off course in the past couple of years, however, because of the financial crisis that buffeted the industry, manufacturing problems with Suzlon turbines and a high level of debt

Suzlon Energy, India’s biggest maker of wind turbine generators, has sold a 35-percent stake recently in Belgian wind gearbox maker Hansen, raising 370 million dollars as it moves to cut debt.

Suzlon Energy Ltd. aims to push for the completion of its purchase of Germany’sREpower Systems AG in the next few months after it finalizes new bank financing, a move that would allow the Indian wind turbine manufacturer to broaden its range of products and streamline its suppliers, according to Sumant Sinha, Suzlon’s chief operating officer.

In an interview, Mr. Sinha said the company would file for a so-called “domination agreement” in Germany “probably in a couple of months.”

Mr. Sinha said the company has spent about $100 million to retrofit blades that cracked on turbines in the U.S. and is making progress on putting its financial affairs in order.

Suzlon as a Speculative stock

Of the company’s total debt, about $250 million is debt owed to the Tanti family that will be converted into equity, he said. A further $500 million is in the form of convertible bonds. About $800 million is in loans from international banks and was used to fund the purchases of REpower and a stake in Hansen Transmissions International N.V., a Belgian turbine gearbox maker. The remaining $1 billion is in rupee-denominated loans from Indian banks.The recent sale of some of its Hansen stake brought Suzlon $370 million and a new $465 million loan from the State Bank of India will allow Suzlon to pay off the acquisition loan from the international banks in the next few days, Mr. Sinha said.

The remaining rupee debt is being refinanced with a consortium of Indian banks on terms that require no principal repayments for two years and no covenants for two years. Covenants are terms in a loan that require the borrower to meet specific financial metrics or face repayment demands. He said the interest rate on this new financing wasn’t yet fixed but would likely be around 10% annually.

That’s doubly good for companies like Suzlon. There are plenty of wind farms being built every year, and Chinese developers don’t require the biggest, newest machines. Friday, Suzlon landed two additional orders in China—for its older, less technologically-advanced machines. “Suzlon is poised to be a key player in this rapidly growing market,” the company said in a press release.

Now, the big challenge for Suzlon is to fend off the established turbine makers who also have their sights set on China. Vestas of Denmark, the global leader, said last week it saw China as its path to bolstering falling global market share.

In other news

As many as 47 Indian companies, led by corporate behemoth Reliance Industries and the country’s biggest lender, State Bank of India, have made it to the list of world’s biggest 2,000 companies by US magazine Forbes. However, five Indian companies — scam-hit IT firm Satyam Computer, realty firm Unitech, Suzlon Energy and two Anil Ambani group firms

Commodity trading in india

Whether it is equity or commodities, one has to trade carefully in futures. These future’s product can make or break yourinvestments. As of now we have only futures available in commodities with out any hedges.

I dont want to comment on number of commodities or liquidity etc as this is a growing market.
But I would suggest… one has adopt TRADE approach while investing in commodities. Trade approach means—- Before youinvest your margin (which is otherwise your capital) one has to be clear about the loss that he can bear. For example, If i am invetsing 1 lakh, i should be clear about my loss such as 50000 or 30000 etc. Then, devide your maximum loss with maximum loss that you want to afford per trade. Ex. I am ready to take a maximum loss of 3000 per trade. That means I should take 10 trades. Assuming all 10 trades hit stop loss then I will loose, Rs.30000/-. If 50% trades hits your target of Rs.4000 to 5000/- per trade, then you will be in profits.

Unfortunately, Most of the positional traders ( Those who take one trade and wait for the market to come in his favour) have suffered huge losses. (loosing entire capital and going to debits)
I can write it on paper that this trade call approach will yeild profits.
Do not over expose yourself. What should I call, if anyone is coming to Commodity Markets with a margin of 5000 to 10000 margins and expecting profits of 5000 to 10000/- … To my human sense it is called as betting or gambling….I dont call it as speculation as speculation is informed trading with sufficient investment margins. Unfortunately, small brokers are allowinginvestors (?) to over exposures. I see someone writing loosing of 20% in a single day. How can one loose 20% in a day when the average volatility is 2 to 3%. That means he must have taken 10 lots of Crude oil with a margin of 12000 to 15000…Crazy man…..Better these kind of people should buy lottery tickets rather than speculation.

My suggestions :

1. Minimum investable amount is Rs.50000/- ( for Agri Commodities), Rs.100000 ( for metals. – Gold 100g and Silver 5Kg, and Copper) and Rs.200000 (For 1 kg Gold and 30 kg Silver and Zinc)

Crude is basically driven by following factors.

1. Weekly US Inventory data ( Wednesday). Increase or decrease in inventories will drive higher or lower

2. Monthly Weather forecast of US.

3. OPEC decision of production Cut ( prices increase) or No production Cut ( price decrease)

4. Militatnt activities. On Friday night, some militants attcked on eof the oil refineries in Nigeria. result was an immediate upside of 1$.

Final suggestion: MARKETS ARE THERE FOR EVER….BUT YOUR MONEY (INVESTMENT) MIGHT NOT…. ALWAYS TRADE WITH STOP LOSSES

Happy Trading