October 16, 2010

VOLUME 4.14
ISSUE 76

Before you can really start setting financial goals,

you need to determine where you stand financially.
-David Bach
Rates 01

Graphs 02

News 03
National & International events in the world of finance

Contemporary Articles
FII flow in Equity market & its impacts 04
SEBI norms on Portfolio Managers 05
Freeing savings interest rates 08
Currency Appreciation 11

Investor’s Focus 09
Technical and fundamental analysis

Did You Know? 10

History of Hedge funds

Commodities Article 13
Fundamental analysis of commodities

Buzz Words 15
Fincopedia
Quiz 17
Check your Financial Quotient
 Rates

Repo 6.00 %
Reverse Repo 5.00 %
Call rate 4.80-6.45 %
Inflation (as on 14 Sept.) 8.50%
Forex Reserve $ 294.158 billion
(as on 8th Oct 2010)
91 day T-Bill 6.5634%
IIP (for August) +5.60%
6.90 GS 2019 8.0907-8.0907%

Student’s cartoon
By- Md. Zafer Iqbal I MBA - M

01
 GRAPHS
Rs/$

46

45.4

44.8

44.2

43.6

43
30-Sep 3-Oct 6-Oct 9-Oct 12-Oct

gold per 10 gm
18400

18200

18000

17800

17600
30-Sep 03-Oct 06-Oct 09-Oct 12-Oct

Oil(per bbl)
87

85

83

81

79
30-Sep 03-Oct 06-Oct 09-Oct 12-Oct

future rates open interest

6300 30800000

6200 28100000

6100 25400000

6000 22700000

5900 20000000
30-Sep 03-Oct 06-Oct 09-Oct 12-Oct

sensex nifty

20700 6300

20500 6200

20300 6100

20100 6000

19900 5900
30-Sep 05-Oct 08-Oct 13-Oct

02
 international news
By- Vaibhav Nagar, I MBA L

• The European Commission has slapped a fine of over 458 million euros on the world’s
largest steelmaker Arcelor Mittal and 16 others for operating a price-fixing cartel for
nearly two decades.
• General Electric Co. signed a deal to buy Dresser Inc. for about $3 billion, its latest
deal to expand its product offerings in gas and other energy markets.
• The world’s wealthiest people have responded to economic worries by buying gold
by the bar - and sometimes by the tonne -- and by moving assets out of the financial
system.
• With countries like India and China investing heavily in their education systems and
in infrastructure, US President Barack Obama has warned that America is losing its
competitive advantage and jobs to emerging nations.

national news

• Roaming rates may fall as DoT is considering to merge existing 22 circles to a single
license with pan-India coverage or to 4 regional zones.
• Vedanta group has finally offered a price of ` 355 for Cairn India. Cairn Energy pro-
poses to sell a maximum of 51 per cent stake in its Indian arm, Cairn India, to Ve-
danta in August.
• The Government has fixed the Coal India Ltd. Initial Public Offer (IPO) price between
` 225 and ` 245 a share.The IPO will be the largest ever from an Indian firm till date,
surpassing that of Reliance Power that raised ` 11,500 crore in January 2008.
• Higher trade deficit and lower net invisibles resulted in the widening of current ac-
count deficit for April-June 2010. According to RBI current account deficit widened to
$13.7 billion in the first quarter of 2010-11, from $4.5 billion in the same period last
year.
• Engineering and construction major Larsen & Tourbo has pared its stake in Mahin-
dra Satyam by offloading 2.84 lakh shares through open market transactions. L&T’s
stake in the company has now fallen to 2.16 per cent as against 4.58 per cent earlier.

03
 FII flow in equity market & impacts
By-Naveen Kumar Kulkarni, I MBA N

India has shown a steady growth in terms of FII flows since liberalisation began which
shows the great importance attached to FII’s. If we observe, the share of FII’s in the
total Foreign Portfolio Investment (FPI) has seen a surge since its entrance in the equity
market from 47% in 1992 to around 72% in 2003. They have emerged as the most
important players in the Indian equity market.

FII’s are Foreign Institutional Investors whose job is to pool

large amounts of money and invest that amount in different
areas like securities, real property and other investment
assets. FII’s are the ones which are highly correlated to the
equity returns in India.

SEBI has recently stated that these institutional investors
have crossed the $20 billion mark in terms of investment
in the equity market. According to SEBI, the net FII’s were
$20.5 billion. This figure states that it has reached all-time
high by crossing the previous figure of $17.5 billion which was achieved in 2007. This
situation occurred just before the sub-prime crisis which hit the economies of the whole
world. Even during the global financial crisis in 2008, the FII’s pumped in a total of
`.1,10,218 crores between April 2009 and March 2010 period that lead to an 80% surge
in Sensex which was the highest ever annual FII inflow for a financial year in the Indian
equity market. In the past 2-months there was an inflow of around $10 billion which has
made the Sensex touch a 30-month high by gaining more than 2500 points in the last two
months. The index has been reaching closer to its previous record high of 21200. FII’s
are pumping funds not only in the equity market but also in the debt market with the net
investment crossing $10 billion.

Reasons:

The FII’s are pumping money in to market

because of

• Global economy is flush with liquidity

and part of this liquidity will find way in
to the Indian equity market.

• Indian growth story which signifies

that investing in Indian market will
always provide the required profits.

• Diversified opportunity which tells

that Indian market is much more
diversified when compared to markets

04
 of other countries like Russia, Brazil etc.

• The opportunity in Indian companies is more when compared to other companies in

other different countries.

• India being the largest democracy in the world definitely inspires confidence in the
Indian economy. This also reduces the risk premium of the country from the FIIs
perspective.

Impact

• There was major impact due to surge in the FII’s investments and that is the
appreciation of rupee over the dollar in less than a month and that is there was a 5%
appreciation of rupee.

• There is a large confusion between the high officials whether to stop the pumping of
the money or allow it.

• The FII’s have become the only one who are driving the market ahead to new
milestones and make the market climb a big ladder.

Conclusion
The countries like India and China have provided growth impetus for the global economy.
Therefore, I think FII inflows will be stable for longer period of time.

SEBI’s norms on portfolio managers fees

By- Bhardwaj Varma I MBA “M”

INTRODUCTION
A portfolio manager is a body corporate who, pursuant to a contract or arrangement
with a client, advises or directs or undertakes on behalf of the client (whether as a
discretionary portfolio manager or otherwise), the management or administration of a
portfolio of securities or the funds of the client.

The relationship between the portfolio manager and client including their mutual rights,
liabilities and obligations are specified in the agreement between the portfolio manager
and the client. Recently SEBI had received complaints from clients relating to fees and
charges levied by portfolio managers and upon scrutiny SEBI noticed that the clauses
relating to fees and charges in the portfolio manager-client agreement do not always
clearly reflect the fees and charges payable by the client. Thus in order to bring about
greater uniformity, clarity and transparency with regard to fees and charges, SEBI has
come out with new norms.

05
SEBI’s NEW GUIDELINES

1. Fees charged should be based on watermark principle

High water mark is the highest value that the portfolio account has reached. The portfolio
manager should charge performance based fee only on increase in portfolio value in
excess of the previously achieved high water mark. High water mark principle would
be applicable only for discretionary and non-discretionary services and not for advisory
services. In case of interim contributions/ withdrawals by clients, performance fees would
be charged after appropriately adjusting the high water mark on proportionate basis.

For example, if a portfolio of ` 20 lakh appreciates to ` 24 lakh in the first year, a

performance fee or profit sharing will be payable on ` 4 lakh. In the next year if the
portfolio value falls to ` 22 lakh, no performance fee will accrue.If the portfolio value goes
up to ` 25 lakh in the third year, the fee can be charged only on ` 1 lakh (` 25 lakh-` 24
lakh). For the fourth year, the ‘high water-mark’ will become ` 25 lakh.

2. Investors liability should not be greater than his investment

In order to discourage portfolio managers from
constructing highly leveraged portfolio structures, SEBI
has put in a condition that in case of a discretionary
portfolio manager, a client’s liability should not exceed
his investment with the portfolio manager.

3. Annexure
Agreement with the client to contain an annexure
containing all fees and charges payable to the portfolio
manager: This annexure should contain details of
levy of all applicable charges on a sample portfolio
of `.10 lacs over a period of one year. The fees and
charges shall be shown for 3 scenarios viz. when the
portfolio value increases by 20%, decreases by 20%
or remains unchanged.

4. Disputes between the portfolio manager and the client in relation to the fees and
charges to be settled through arbitration under the Arbitration and Conciliation Act, 1996.
The new norms for portfolio managers will apply from November 1. As regards the
existing customers, the portfolio managers will be required to implement the norms from
January 1, 2011.

CONCLUSION
SEBI’s move is to bring in standardisation in the industry is in the interest of investors
and a nightmare to few of the portfolio managers.

5 CHAANAKYA VOL 4_13 06

 Freeing savings interest rates
By- Kumar Gaurav I MBA M

If RBI approves what it reviewed at a pre monetary policy review meeting, guaranteed
return on savings bank account may soon be a thing of past. This means that saving
account interest rate will be deregulated. Deregulation means every bank will have the
freedom to set the interest rate depending on their needs of fund as this is the primary
source of low cost funds to banks. At present, the rate is 3.5% as mandated by RBI.

This step will definitely take care of the interest of small depositors as they are the
worst hit because of increasing Consumer Price Index and Wholesale Price index year
by year. The current rate of saving bank reflects a negative return as it is not on par
with increasing above mentioned rates. This is high time RBI looks into it. And the first
step towards the freedom was taken when decision to calculate interest on saving bank
account on daily basis was taken.

Most of the Public sector banks are opposing this move as they say that this will definitely
erode their profits which are anyways not impressive. But I feel this will not impact
banks much as customers are not going to migrate to other banks just because of some
difference in interest rate. I feel it is not fair to offer such low rates to customer, just
because banks, mostly public are not able to cut down their cost which primarily involves
downsizing of staff. Most studies shows that by employing less staff at least new private
banks are efficient if not making great profits. Of course there are other factors too if
public banks want to counterpart with private banks or foreign banks. Savings bank rate
may go low, if banks cut cost, go for low cost fund which increases liquidity.

This move will definitely help to break the monopoly of bank leading to lowering of rates
in some areas and increasing in other areas. But there are other issues to be taken care
of. Most importantly is transparency. There should not be any biasing or discrimination
on the interest rate on the basis of location of the bank or the type of customer. All such
issues should be dealt properly.

By- Hiran II MBA K

7 CHAANAKYA VOL 4_13

07

HCL Infosystems Ltd.
Indian Markets had a mag-
nificent run in the past one
month. The benchmark indi-
ces gained over 15% in last
45 days. The valuations have
gone somewhat high and it is
a period of uncertainty when
it comes to entering into
fresh positions. However we
would rely on technical
charts to pick new stocks
keeping a tight stop-loss for
each pick.
HCL Infosystems Ltd. is
India’s premier hardware,
services and ICT systems
integration company offer-
ing a wide spectrum of ICT
products that includes Com-
puting, Storage, Networking,
Security, Telecom, Imaging
and Retail.
Technically Speaking
Price crosses 50 day moving aver-
age and bullish engulfing candle-
stick pa ttern is formed. We may
enjoy a sho rt up move forming dou -
ble bo tto m pa ttern.
Momen tu m rises sharply over 5%
Investor’s focus
Fundamentally Speaking
The company is growing
leaps and bounds. The man-
agement is aggressive and
company has bagged big
deals in recent past which
will drive the sales for the
company. They recently
picked up a majority stake
in Dubai based NTS sys-
tems. They also bagged
offers from Census of In-
dia (` 40 crores), Delhi
International Airport Lim-
ited, Government of Madh-
ya Pradesh & Himachal Pra-
desh electricity board,
which has driven the order
book higher. HCL Infosys-
tems announced its entry
into business with the
launch of HCL O’zone ser-
vice which will offer busi-
ness applications, produc-
tivity applications and IT
Stoc hastic signal aligns with a
possible forma tion of dou ble
bo tto m pa ttern, indicating
reversal of prior tren d.
By- Madhukar Das I MBA G
Other Picks
service solutions to the us- BUY :
ers.
Binani Indus-
The Q1FY11 PAT was up 5%
from the previous quarter at tries
` 71.64 crore. The company CMP—`216.10
has risen in both topline &
bottomline over past few Target—`250
quarters and has already
Stop Loss—`205
given 375% dividend in past
one year. It is expected to Agro Dutch Ind.
outperform this quarter
CMP—`30.75
again. The Company is also
mulling merger with parent Target—`34.50
company HCL technologies
which may result in short
Stop Loss—
term buying interest among `29.50
traders and investors. Cur-
rent P/E—11.7
Sell :
Punj Lloyd
CMP —`137.50
Target—`122.50
Stop Loss—`144
Special points of
interest:
Since we are looking
at a trading horizon
of 15-30 days, we
shall give more
weightage to technical
analysis and price
CCI and R% chart indicates the trend of the stock.
scrip has reac hed overso ld re- We shall also study
gion and is now making a rever- the fundamental as-
sal. pects of a company to
avoid getting into loss
making trade positions
in case of movement
Recommendation : BUY of market in direction
opposite to that of my
CMP : `120.20 prediction.
Target Price : `133-135
Stop loss : ` 114.40
08
 History of Hedge Funds
By- Amar G.M.- V MBA K
Hedging risk has been an integral part of the financial markets for many years. In the
1800s, commodity producers and merchants began
using forward contracts for protection against unfa-
vorable price changes. This system is still very active
today. The term “hedge fund” dates back just to 1949.
In 1949, almost all investment strategies took only long
positions. A reporter for Fortune magazine, named
Alfred Winslow Jones, published an article pointing out
that investors could achieve higher returns if hedging
were implemented into an investment strategy. This
was the beginning of the Jones model of investing.

To prove his hypothesis, Jones launched an invest-

ment partnership incorporating two investment tools
into his strategy: short selling and leverage. The pur-
pose of these two strategies was to limit risk and en-
hance returns simultaneously. In addition, Jones established two important charac-
teristics that are still part of the industry today. He used an incentive fee of 20% of profits
and he kept most of his own personal money in the fund. This ensured that his personal
goals and the goals of his investors were in alignment.

Exceptional results were obtained through this hedged approach. During the period from
1962 to 1966, Jones outperformed the top mutual fund by more than 85%, net of fees.
The success of Jones stimulated the interest of high net worth individuals in hedge
funds. Not only did Jones attract the interest of high net worth individuals to hedge funds,
but also many top money managers were drawn to hedge fund because of the unique
fee structure. A 20% incentive fee made it possible for
managers to earn 10 to 20 times as much in compen-
sation when compared to long-only money management
services.

Between 1966 and 1968, nearly 140 new hedge funds

were launched as a consequence of the new dynamics
of investing and managing money. Many of these funds,
however, did not follow the Jones model of hedging risk.
Instead of hedging, only leverage was used to enhance
returns, ignoring the short-selling aspect that Jones em-
ployed. Using a leveraged, long-only strategy made these
funds highly susceptible to the market downturn that be-
gan in late 1968. Some hedge funds dropped in value by
more than 70% within two years.

Large hedge fund losses due to the 1973-1974 bear

market caused many investors to turn away from hedge
funds. For the next ten years, few managers could attract

10
the necessary capital to launch new partnerships. By 1984, there were only 68 funds in
existence. In the late 1980’s, a small group of extremely talented hedge fund managers,
including George Soros, Michael Steinhart, and Julian Robertson, gave hedge funds a
restored credibility. Despite difficult market conditions, these managers produced annual
returns of greater than 50%.

Many of the world’s best money managers left the traditional institutional and retail in-
vestment firms because of potentially higher fees and great flexibility with managing
hedge fund products. By 1990, there were over 500 hedge funds worldwide with assets
of about $38 billion. Hedge funds now represent one of the largest segments of the
investment management industry. Currently, it is estimated that there are over 6,000
hedge funds in existence with total money under management in excess of $1 trillion.

Hedge Fund in India:

Hedge funds were demystified in the Indian markets only recently when the market
opened up to newer investment opportunities. The hedge funds database is managed
regularly to keep track of the investment patterns of the market.

Hedge funds explained the growth of short positions in the markets. The market fail-
ures do not affect hedge fund investors and hedge fund managers due to the liquidity
leverage they bring. The hedge fund manager or administrator acts as an analyst keep-
ing track of the hedge funds news, bonus returns, quotes, valuations and returns. The
hedge fund statistics include a careful research on all these factors to avoid any kind of
fraud in the valuations. That’s all about the Hedge funds.

Currency appreciation
By- Rohit Dhannawat I MBA-L

Introduction
The Indian currency was the Asia’s best performing currency is the past month. The In-
dian currency touched ` 44.11 on October 7, 2010 strongest since September 2008. It is
likely to continue for the coming days. Although the forex reserves increased by over $2.5
billion, the total reserves has reduced by over `16000 cr. in the last week.

Content
Indian economy is among the fastest growing economies of the world. The appreciation
of the rupees against the dollar is another giant sign towards economic prosperity. In re-
cent times, India has attracted huge capital in terms of Foreign Direct Investment (FDI),
and Foreign Institutional Investment (FII), External Commercial Borrowings (ECB) and
Non-Resident Indian (NRI) deposits and remittances also contributed to the dollar inflow.
The FII’s have invested around ` 998.7 cr. in the past few months. The stock market has
seen FII’s as net buyers consecutively for last 29 days.

Although India had been witnessing strong dollar inflows for some time, the rupee has

11
not appreciated as steeply as it did between Sept.
06 and July 07. Earlier when strong dollar inflow was
seen into India the Reserve Bank of India (RBI) used
to intervene in the foreign exchange market and pur-
chase excess dollars so as to minimize volatility in
the value of the rupee. But during 2006-07 RBI had
chosen not to intervene in order to control the domes-
tic inflation. While RBI was able to tame the inflation
rate, the rupee’s appreciation had affected Indian ex-
porters as Indian goods became more expensive for
foreign buyers. Information technology (IT) and tex-
tiles industries were particularly hard-hit, as they were
most dependent on the US. The IT firm Wipro had
reported 2.4% less profit only because of currency
appreciation of rupee over dollar.

Any appreciation in the rupee results in an erosion

in the value of the RBI’s foreign exchange reserves.
The RBI had been buying the US dollars when it was
valued around ` 48 – 49 till the present valuation of ` 44 – 45. Thus, it has already lost
around 12-15 percent on the dollar value. The present forex reserves of the country are
around $ 294.158 billion.

The inflation in India has been high for a very long time because of which RBI has its
hands tied up in curtailing appreciating rupee. In normal circumstances, RBI buys USD
from the market releasing more rupee. But with inflation affecting the Indian economy
more rupee in the market will be like oil in fire on inflation. Hence we cannot expect RBI
and group of Indian nationalized banks to buy USD.

RBI has been increasing interest rate for last one year just in order to curb inflation and
reduce flow of money in the market. RBI has also increased CRR so that money available
with bank for lending is lesser which has taken its toll on growth rate in industrial sector
as loans have become expensive and many businesses have postponed their expansion
plans. Rising interest rate has also led to appreciation of rupee as foreign investors have
found parking money in India as a lucrative option fetching them high interest income,
which has hurt our export industry. RBI might allow some appreciation in the rupee and
start worrying about currency appreciation only after inflation has reduced further.

The currency appreciation has benefited the economy by making imports cheaper. The
biggest gainers are in automobile industry such as Hero Honda. On the other hand IT,
textile, leather industry and other export industries are losing a large part of profit as they
are unable to raise the rates for the consumers. Although exports account for a relatively
small share of the economy, it cannot be ignored as it has been an important catalyst of
economic growth.

Conclusion:
The appreciation of the rupees will help the economy in many ways. There will be positive

12
impact on importers and negative impact on the exporters. It will help in easing the pres-
sure related to foreign debt on India and Indian companies. Considering that the govt is
in disinvestment mood in major public sector units, and a substantial chunk of this being
subscribed by FIIs, the latter will have to invest more dollars to pick up stake in the com-
pany being disinvested, thus aiding the Government build up reserves.

Export industry such as IT will lose out to other competitors as the profit margin will be
affected to a large extent. For other export companies a lot will depend if they can get
exemptions in the duty charges in order to reduce the overall price and increase the profit
margin.

FUNDAMENTAL ANALYSIS OF COMMODITIES

By - Mookambigai.G II MBA M

Fundamental analysis is a means of analyzing commodities and trying to predict where

the prices of commodities should be trading and what they will do in the future. The main
basis for fundamental analysis is supply and demand.

Supply and demand is a very simple equation, but it gets more complicated when we try
to forecast prices in the future. Commodities trade in cycles. Some times supplies will
be tight and prices will be high. Other times, we just have too much of a commodity and
prices fall accordingly. Lets look at the commodities that are trading at multi-year highs or
lows. Eventually, the picture will change and that will lead to a good trading opportunity.

Price movements in commodities using fundamental analysis

can be broken down into these simple formulas:

• Demand > Supply = Higher Prices

• Supply > Demand = Lower Prices

Supply of Commodities:
The supply of a commodity is the amount that is carried over
from previous year(s) of production and the amount that is being
produced during the current year. For example, the current sup-
ply of soyabeans would include the amount of crops in the ground and the amount that is
left over from the previous season. Typically, the more that is carried over from the previ-
ous season, the lower the prices will fall.

There are many factors that can impact the supply of commodities like weather, amount
of acres planted, production strikes, crop diseases and technology. The main thing to
remember when using fundamental analysis is that high prices for commodities will lead
to an increase in production, as it is more profitable to produce commodities when prices
are higher. As we might expect, demand will typically drop as prices move higher.

Demand for Commodities:

Demand for commodities is the amount that is consumed at a given price level. The rule
of thumb is that demand will increase when the price of a commodity moves lower. Oppo-

13
sitely, demand will decrease as the price of a commodity increases. There is an old say-
ing among commodity traders that low prices cure low prices. This means that more of
a commodity will be consumed at lower prices, which lowers the supply and thus prices
will eventually increase.

Just think about how we would use more gasoline at $1.50 per gallon than you would at
$3 per gallon. Fundamental analysis of commodities is simple economics. Consumption
patterns change as the prices of commodities move higher and lower.
Using Fundamental Analysis to Predict Future Prices of Commodities

Prices will fluctuate in the short term, so it is not easy to make fundamental forecasts of
commodities prices and make short-term trades. It is even more difficult for new com-
modity traders to do this. So new traders, and even experienced traders, must use a
long-term strategy when using fundamental analysis to forecast commodity prices. We
should look for trends that are developing that will cause a shift supply and demand fac-
tors.

To begin our fundamental research of commodities, there are numerous reports that are
compiled by government sources – USDA, Department of Energy and the Futures Ex-
changes. Many of the larger commodity brokers will also publish fundamental research
for their clients.

It may seem like a daunting task to find all the current data and compare it to previous
years and see how prices reacted under those conditions. Worse yet, we have to fore-
cast in the future as to what the supply and demand scenario will be. It is almost impos-
sible to do this, especially since we will be competing against experts who have a lot
more information and experience than us.

We must look for trends in production and consumption and trade with that bias. For ex-
ample, if the supplies of corn are at a five-year high and we just planted a record amount
of acres of corn for this season, it is likely that corn futures will trade with a downward
bias. We would be likely want to trade from the short side.

Now, at some point, the price of corn will get too low and demand will increase. Or, there
might be weather problems during the growing season that will lower the production of
corn. In these cases we have to be flexible and realize that prices won’t go down forever.

The longer-term trends in commodities are easier to spot with fundamental analysis,
but we must use technical analysis to capture shorter-term movements in commodities
prices. Most professional commodity traders like to know what the big picture is with
commodities using fundamental analysis and then they use technical analysis to time
their entries and exits.

14
 BUZZ WORDS
Lockdown
A specified period when an employee of a public company is barred from selling - and
occasionally buying - his or her company’s stock.

Legislative Overkill
A law enacted to stop or prevent the abuse of a loophole, but ends up imposing more
restrictions than are necessary for reasonable prevention.

Lame Duck
A person who has defaulted on his or her debts or has gone bankrupted due to the stock
market. The financial use of the term is most commonly used in Europe.

Leakage
A release of information to certain people before the official public announcement.

Lobster Trap
A strategy used by a target firm to prevent a hostile takeover. In a lobster trap, the com-
pany passes a provision preventing anyone with more than 10% ownership from con-
verting convertible securities into voting stock.

Sleeping Beauty
A company that is prime for takeover but has not been approached by an acquiring
company.

Sandbag
A stalling tactic used by management to deter a company that is showing interest in tak-
ing them over.

Blue Ocean
A slang term for the uncontested market space for an unknown industry or innovation.

Bracket Creep
A situation where inflation pushes income into higher tax brackets. The result is an in-
crease in income taxes but no increase in real purchasing power.

“Bankruptcy stared me in the face, but one thought kept

me calm; soon I’d be too poor to need an anti-theft alarm.”
~Gina Rothfels

14 CHAANAKYA VOL 4_13

15
 ALUMNI SPEAK
By- CLIFFORD CARDOZA
MOHIL KAPOOR
SMITHA JOSEPH

In this edition we have with us, Mrs. Preethi Rammohan

Name: Mrs.Preethi Rammohan

Organization: Amba Research
Designation: Analyst
Batch: 2008
Areas of Interest: Field of Research and Analysis
Email-Id: rpreethi.2@gmail.com
Contact number: +91 9972319188

Chaanakya: What is expected of an analyst at Amba Research?

Mrs. Preethi: An analyst at Amba Research is involved in Investment Research. The
work involves financial modelling, report writing, forecasting and analysis of company
and industry performances along with huge amounts of data collection and presentation.

Chaanakya: What does it take to write down company reports and analyze its health?
Mrs. Preethi: Most importantly you need to have an interest in this kind of work and
sharp analytical skills. In depth industry knowledge makes analysis easier and quicker.

Chaanakya: With all the big scams around, do you think reports rendered by companies
are trusted and comprehended by the common man?
Mrs. Preethi: Reports published by companies are our only source of information. It’s up
to the common man to interpret them. I think the common man is wise enough to make
interpretations of his own as an investor; our job is to just provide the accurate informa-
tion. Hence, we have no other choice.

Chaanakya: “IPO’s back in the market, led by COAL INDIA LTD.”, in your opinion – how
far should the government’s disinvestment policy go?
Mrs. Preethi: It’s important for the government to carry out the divestment in a structured
and steady manner.

Chaanakya: How do you relate experience versus added qualifications in terms of job
prospects in the corporate environment today?
Mrs. Preethi: Added qualification is only a gate pass to the corporate world. What is
more important is the way you market your added qualification or your experience. I think
what matters most is one’s ability and skills, added qualifications just polish up the final
product (the candidate in this case). Experience, on the other hand shows how well one
can handle real life situations. So, though experience and added qualifications certainly
come in handy, but more importantly it’s the candidates ability that matters the most.

Chaanakya: How important is it to have an MBA if you’re contemplating a career as a

financial advisor or financial analyst? Many people get jobs in these fields with only a
bachelor’s degree and virtually no work experience and seem to do quite well?

16
Mrs. Preethi: MBA as a degree, as I already mentioned is only a gate pass. Companies
look for talent and skills more, than just a degree in a candidate. It’s true that recently
people with just a bachelor’s degree seem to do quite well in some organizations, but I
still believe MBA graduates bring more to an organization than people with just a bach-
elor’s degree.

Chaanakya: Message for Students.

Mrs. Preethi: Don’t study, just learn!

Thank You!!!

Quiz
By- Abhijeet Sekhawat I MBA G
1. What is the combined networth of India’s 100 richest people as per the latest
Forbes research study?
a. $ 276 bn
b. $ 300 bn
c. $ 400 bn
d. $ 250 bn

2. Who is the CEO of Kingfisher Airlines?

a. Vijay Mallya
b. Sanjay Aggarwal
c. SR Gupta
d. Siddharth Mallya

3. Consumer goods major UNILEVER will acquire the US based Alberto Culver
Company for the cash deal of :
a. $ 4.5 bn
b. $ 3 bn
c. $ 4 bn
d. $ 3.7 bn

4. Wal - Mart Stores Inc, the world’s largest retailer, is planning to buy Massmart
Holdings Ltd. In a transaction worth about $ 4.6 bn, for entering into which place?
a. Brazil
b. India
c. Africa
d. China

17
 Crossword

Across

1. The term “Silver Thursday “ is associated with?

4. These exchange-traded funds are not present in the world.
5. World Bank president

Down

2. Asia-focused bank which launched a $5.3 billion rights to bolster its finances for
new capital rules and for growth opportunities.
3. Recently floated the world’s largest IPO

Answers for quiz:

1. B
2. B
3. D
4. C

16 CHAANAKYA VOL 4_13

18
 TEAM

Manesh Paul Mani

Editor-in-chief Dorin Jane
Quiz & Did You Know
Sachin
Mantri Ankit Atul
Cartoon
Quotes & Buzz Words
Amutha Priya D
Pottim Sahiti Reddy
News
Crosswords
Nivedita Tiwary
Vipul Jain
Investors check
Graph, Rates
Sonal Sankhla&
Dhanya Anna Kurianm &
T. Deekshith Ravi Chandra Resmy Sebastian
Student Article Review Committee
Nithya Prakash
Apoorv Jhudeley &
Scam
T. Deekshith Ravi Chandra
Mookambigai Creative Head & Design
Commodities Market
Pradeep Thangavel
Niveditha S
Compiling and Editing
Debate

Clifford Cardoza, Smitha

Joseph & Mohil Kapoor
Alumni Speak

18 CHAANAKYA VOL 4_13

 Institute of Management
Hosur Road, Bangalore - 5600029, Karnataka, India
Tel: +91-80-4012 9350/9351/9355
Fax: +91-80-4012 9000
Website: www.christuniversity.in

Please mail your valuable feedbacks, reviews at chaanakya@mba.christuniversity.in