DLF posted their results for the 4th quarter and the entire year.
Is revenues plunging by 97% is not a catastrophe? House buyers have just clammed down. Comparing it to US, where the dust still hasn't settled, the house sales are actually flat or marginally lower over last year.
I think the only reason India is still standing is because housing and mortgage industry in India is still small compared to other parts of the economy and so not so badly impacted by this precipitous fall. Ppl are much less leveraged and they can hold on to their houses for ever rather than sell at a lower or default. This only makes the housing mkt in India very illiquid in times of downturn. Also, this means that it would take a long time for this housing crises to correct.
Sidebar: How is DLF still making money with 3% of its revenue? Unless all its costs are variable costs, this just does not seem reasonable. What about interest payments to banks and other depreciation? The sales came doen from 1600 crore to 56 crore and yet they made 30 crore profit. I accept I do not get the real estate business.
Thursday, April 30, 2009
Monday, April 27, 2009
An Interim World
Interesting Article this one. Freddie Mac Interim CEO thanks ex-CEO to take on the role of Interim CFO as the present Interim CFO committed suicide.
So much so for govt run organizations. After all govt is filling in as Interim Caretaker till Freddie can wriggle out of Interim Crisis ;)
So much so for govt run organizations. After all govt is filling in as Interim Caretaker till Freddie can wriggle out of Interim Crisis ;)
Sunday, April 26, 2009
Books This Year
Disclaimer: I'm not a voracious reader.
I generally read about 3-4 books a year. This year has been slow as usual. I started with White Tiger. I loved the brutal, honest, vivid and sometimes repulsive description of life in "The Darkness". Anyone who has journeyed across India in a train can recall how apt the descriptions were. The character of Balram Halwai was too gray and almost impossible to judge. As Oscar Wilde once said, "Every Saint has a past and every sinnner has a future." In the end I'm unable to feel happy for him though he comes out of the predicament on top. I believe Balram had something in common with the tycoons, the dictators and hardened criminals. I call it self centeredness. Anyhow, the book is a gem.
The second one I read was Amitav Ghosh's Hungry tide. I thought there was too much prose in the book without adequate meat. It meandered like the river itself and never really got my interest. I liked Piya's character. I admire women with resolve and conviction. But then the author spent too much time showing off his knowledge of geography, aquatic life in the Ganga basin and such, impeding the flow of the book. I would not recommend it.
I generally read about 3-4 books a year. This year has been slow as usual. I started with White Tiger. I loved the brutal, honest, vivid and sometimes repulsive description of life in "The Darkness". Anyone who has journeyed across India in a train can recall how apt the descriptions were. The character of Balram Halwai was too gray and almost impossible to judge. As Oscar Wilde once said, "Every Saint has a past and every sinnner has a future." In the end I'm unable to feel happy for him though he comes out of the predicament on top. I believe Balram had something in common with the tycoons, the dictators and hardened criminals. I call it self centeredness. Anyhow, the book is a gem.
The second one I read was Amitav Ghosh's Hungry tide. I thought there was too much prose in the book without adequate meat. It meandered like the river itself and never really got my interest. I liked Piya's character. I admire women with resolve and conviction. But then the author spent too much time showing off his knowledge of geography, aquatic life in the Ganga basin and such, impeding the flow of the book. I would not recommend it.
Tuesday, April 14, 2009
Satyam, A Happy Ending
And the winner is... Tech Mahindra! Good job Govt of India! There are are purists that say that govt. should not meddle with business of business. Yet, I could not think of a more expeditious way of handling satyam sell off.
I think responsible governance means knowing when to step in and when to step out. A few months back I read an article in NY times about YV Reddy, our ex- RBI Gov. The columnist went on extolling his work in keeping a check on the banks and regulating their investments in the realty sector. YV Reddy, tried the best he could to rein in the real estate bubble. He disallowed ECB, asked banks to raise risk weighting for real estate investments, limited the exposure banks could have to real estate and raised interest rates. Not that it completely deflated the housing bubble, but it did help in moderating it.
Regulation could be good and bad. Only history can tell if the decisions taken today had the desired results. Obama is making some very bold moves. These could help restore confidence in the US financial sector and US economy in general or plunge it into the abyss of debt for generations. Is he doing the right thing? Lets wait a few years till History Channel brings back the Credit Crisis of 2008 to your idiot box on prime time.
I think responsible governance means knowing when to step in and when to step out. A few months back I read an article in NY times about YV Reddy, our ex- RBI Gov. The columnist went on extolling his work in keeping a check on the banks and regulating their investments in the realty sector. YV Reddy, tried the best he could to rein in the real estate bubble. He disallowed ECB, asked banks to raise risk weighting for real estate investments, limited the exposure banks could have to real estate and raised interest rates. Not that it completely deflated the housing bubble, but it did help in moderating it.
Regulation could be good and bad. Only history can tell if the decisions taken today had the desired results. Obama is making some very bold moves. These could help restore confidence in the US financial sector and US economy in general or plunge it into the abyss of debt for generations. Is he doing the right thing? Lets wait a few years till History Channel brings back the Credit Crisis of 2008 to your idiot box on prime time.
Tuesday, April 07, 2009
Road to Recovery
Starting 9-Mar-09 when Vikram Pandit, the CEO of Citi sent out the internal memo stating Citi made money in Jan and Feb, Dow has rallied from 6500 to almost 8000. Same with markets world wide. Indian mkt has bounced back from 8K to 10K.
In fact I have started seeing some mkt reports stating the recovery is just round the corner, sometime mid year, and it would be a strong recovery.
I somehow do not think so. I think, this is a false start. The malice is so deep and so wide spread, its going to be at least a year before recovery kicks in.
So I'm predicting that the stock markets will fall again. I've been wrong on numerous occasions. Lets see if this is one another one.
In fact I have started seeing some mkt reports stating the recovery is just round the corner, sometime mid year, and it would be a strong recovery.
I somehow do not think so. I think, this is a false start. The malice is so deep and so wide spread, its going to be at least a year before recovery kicks in.
So I'm predicting that the stock markets will fall again. I've been wrong on numerous occasions. Lets see if this is one another one.
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