Well, we knew we were going to see a big drop any day now and the Indian market finally obliged last week. As I write this the Sensex is down another 150 points. So the question now becomes when can we expect a bottom to pick up some quality Indian Stocks.
This is just a healthy decline and will hopefully give us all an opportunity for the long term.
Weekly and YTD Price Change - Week ending October 19, 2007
* Dividends not included
| Stocks |
Weekly % |
YTD % |
| BSE Sensex |
-4.66% |
27.37% |
| Videsh Sanchar (VSL) |
-12.38% |
25.81% |
| Rediff (REDF) |
-12.01% |
-13.97% |
| Patni Computers (PTI) |
-11.02% |
7.94% |
| India Fund (IFN) |
-10.06% |
12.64% |
| Sterlite Ltd. (SLT) |
-9.82% |
48.96% |
| HDFC Bank (HDB) |
-8.88% |
40.96% |
| IPATH ETNS (INP) |
-8.56% |
40.25% |
| Sify (SIFY) |
-7.91% |
-16.89% |
| MS India Fund (IIF) |
-7.89% |
0.55% |
| Tata Motors (TTM) |
-6.45% |
-3.60% |
| Infosys (INFY) |
-5.75% |
-10.42% |
| Mahanagar Tel. (MTE) |
-4.74% |
28.89% |
| Wipro (WIT) |
-3.30% |
-6.62% |
| WNS Holdings (WNS) |
-2.83% |
-26.11% |
| Genpact (G) |
-2.80% |
14.00% |
| ICICI Bank (IBN) |
-2.66% |
27.14% |
| Satyam (SAY) |
-2.44% |
8.29% |
| Dr. Reddy’s (RDY) |
-2.13% |
-13.81% |
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Sensex, India’s Benchmark Index, is up 33.60% YTD. However, about 30% of those gains have come during the last 8 weeks. Overheated?
Also, I just noticed that the one stock that no one talks about (including me) is the Telecom Giant Videsh Sanchar Nigam Limited (NYSE: VSL). VSL is up about 44% YTD.
The Indian markets have mostly been driven by Indian Stocks not listed here in the United States. The only US listed stocks that have participated in this run are ICICI Bank (IBN), HDFC Bank (HDB), newly listed Sterlite (SLT) and Videsh Sanchar Nigam Limited(VSL).
Investors who put their money in the Indian ETF, IPATH ETNS (INP), have done pretty good with gains of 54% YTD. Obviously, INP gives you the exposure to the overall Indian market.
The two Indian Closed end funds, IIF and IFN, are trading at about 10% discount even after their recent run. It’s seems pretty obvious that investors prefer INP over IIF and IFN.
Indian Stocks Weekly and YTD Price Change – Week ending October 12, 2007
| Stocks |
Weekly % |
YTD % |
| BSE Sensex |
3.63% |
33.60% |
| Videsh Sanchar (VSL) |
14.27% |
43.59% |
| Sterlite Ltd. (SLT) |
12.41% |
65.18% |
| Patni Computers (PTI) |
5.49% |
21.31% |
| India Fund (IFN) |
5.33% |
25.23% |
| HDFC Bank (HDB) |
4.50% |
54.69% |
| Tata Motors (TTM) |
4.46% |
3.05% |
| MS India Fund (IIF) |
4.32% |
9.17% |
| Mahanagar Tel. (MTE) |
4.07% |
35.31% |
| IPATH ETNS (INP) |
3.15% |
53.38% |
| WNS Holdings (WNS) |
2.87% |
-23.95% |
| ICICI Bank (IBN) |
2.56% |
30.61% |
| Wipro (WIT) |
1.64% |
-3.44% |
| Rediff (REDF) |
1.01% |
-2.23% |
| Infosys (INFY) |
-1.41% |
-4.96% |
| Sify (SIFY) |
-1.49% |
-9.76% |
| Genpact (G) |
-2.61% |
17.29% |
| Satyam (SAY) |
-3.20% |
11.00% |
| Dr. Reddy’s (RDY) |
-5.01% |
-11.93% |
*At the time of this writing I don’t have a position (long or short) in any of the stocks listed above. Subject to change anytime
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Indian Stocks Weekly and YTD Price Change – Week ending 10/5/2007:
| Stocks |
Weekly % |
YTD % |
| BSE Sensex |
2.79% |
28.91% |
| WNS Holdings (WNS) |
33.66% |
-26.08% |
| Videsh Sanchar (VSL) |
9.03% |
25.66% |
| Infosys (INFY) |
8.35% |
-3.60% |
| IPATH ETNS (INP) |
7.28% |
48.69% |
| Sterlite Ltd. (SLT) |
6.76% |
46.95% |
| Satyam (SAY) |
6.33% |
14.66% |
| Wipro (WIT) |
5.33% |
-5.00% |
| MS India Fund (IIF) |
4.56% |
4.64% |
| HDFC Bank (HDB) |
3.57% |
48.03% |
| Tata Motors (TTM) |
3.19% |
-1.35% |
| Sify (SIFY) |
2.71% |
-8.39% |
| Mahanagar Tel. (MTE) |
2.66% |
30.02% |
| Dr. Reddy’s (RDY) |
2.57% |
-7.29% |
| ICICI Bank (IBN) |
1.48% |
27.35% |
| India Fund (IFN) |
0.50% |
18.89% |
| Patni Computers (PTI) |
-0.17% |
15.00% |
| Rediff (REDF) |
-0.22% |
-3.21% |
| Genpact (G) |
-0.53% |
20.43% |
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Indian stocks continued their strong run last week as the BSE Sensex touched an all-time high of 17,361.50. Sensex, Bombay Stock Exchange’s benchmark index which consists of 30 companies, is up about 25% year-to-date.
Not all US listed Indian stocks have benefited by the strong run in the Indian markets. If you look at the chart in the previous article you will see that the strong performers have been the Indian Banks, HDFC Bank (HDB) and ICICI Bank (IBN) and the Indian ETF (INP). The newly listed Sterlite (SLT) has also performed well. However, IT, Outsourcing and Internet stocks have all under-performed.
But is the Indian Market getting ahead of itself?
Following is a statement issued by Indian Finance Minister P. Chidambaram on Friday, as he told investors “to do their homework” before investing in the domestic share market that has raced to new highs on the back of overseas fund flows. This after the BSE Sensex set new highs on eight successive trading days. So far, overseas funds have invested $11.63 billion dollars in Indian equities this year, compared $4.86 billion dollars they pumped in during the same period last year. (Source: AFP)
Optimism is running high in India and further gains are expected. Why not? The Indian Economy is in a great shape and continues to roll out amazing GDP growth rates. Indian Banks have almost no exposure to the sub-prime mortgage mess and their stock prices reflect that. However, the strong rupee is a concern
Indian markets will react based on how the global market react in the next coming weeks and months. Even if the global markets remains strong, I think there might still be a room for a small correction before it makes new highs. But any downside in the US (which I am expecting for a while now but just doesn’t seem to happen) could cause a major breakdown in India. We are already aware that Indian markets react strongly both ways and with such a long stretch of upside there might be a little downside coming soon.
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Indian Stocks Weekly and YTD Price Change (WE 9/28/2007):
| Stocks |
Weekly % |
YTD % |
| BSE Sensex |
4.39% |
25.42% |
| Genpact (G) |
20.47% |
21.07% |
| Rediff (REDF) |
12.69% |
-2.99% |
| Sify (SIFY) |
9.25% |
-10.81% |
| India Fund (IFN) |
6.76% |
18.30% |
| HDFC Bank (HDB) |
6.08% |
42.94% |
| ICICI Bank (IBN) |
5.44% |
25.49% |
| Tata Motors (TTM) |
4.99% |
-4.40% |
| Satyam (SAY) |
4.65% |
7.83% |
| Sterlite Ltd. (SLT) |
4.17% |
37.65% |
| MS India Fund (IIF) |
4.05% |
0.08% |
| Wipro (WIT) |
3.88% |
-9.81% |
| Infosys (INFY) |
3.80% |
-11.03% |
| IPATH ETNS (INP) |
3.56% |
38.61% |
| Videsh Sanchar (VSL) |
2.91% |
15.25% |
| Dr. Reddy’s (RDY) |
1.93% |
-9.61% |
| Mahanagar Tel. (MTE) |
0.51% |
26.65% |
| Patni Computers (PTI) |
0.47% |
15.19% |
| WNS Holdings (WNS) |
-0.17% |
-44.69% |
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Indian Stocks Weekly and YTD Price Change:
| Stocks |
Weekly % |
YTD % |
| BSE Sensex |
6.16% |
20.14% |
| ICICI Bank (IBN) |
11.91% |
19.02% |
| HDFC Bank (HDB) |
10.80% |
34.74% |
| Mahanagar Tel. (MTE) |
10.56% |
26.00% |
| Sterlite Ltd. (SLT) |
9.97% |
32.14% |
| Videsh Sanchar (VSL) |
8.45% |
11.99% |
| IPATH ETNS (INP) |
7.70% |
33.84% |
| Tata Motors (TTM) |
7.11% |
-8.94% |
| Sify (SIFY) |
7.02% |
-18.36% |
| Rediff (REDF) |
6.67% |
-13.91% |
| MS India Fund (IIF) |
4.71% |
-3.82% |
| Patni Computers (PTI) |
4.68% |
14.65% |
| Satyam (SAY) |
3.38% |
3.04% |
| India Fund (IFN) |
2.33% |
10.81% |
| Wipro (WIT) |
1.76% |
-13.18% |
| Dr. Reddy’s (RDY) |
-0.43% |
-11.33% |
| Infosys (INFY) |
-1.25% |
-14.29% |
| Genpact (G) |
-3.37% |
0.50% |
| WNS Holdings (WNS) |
-4.81% |
-44.60% |
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