India’s inflation exceeded 9 percent for a 10th straight month in September, maintaining pressure on the central bank to extend its record interest-rate increases.
The benchmark wholesale-price index rose 9.72 percent from a year earlier after a 9.78 percent jump in August, the commerce ministry said in New Delhi today. The median of 21 estimates in a Bloomberg News survey was for a 9.75 percent increase.
Elevated inflation in India and China are crimping room for policy makers to ease monetary policy and support global growth amid Europe’s debt crisis and a faltering U.S. recovery. India’s central bank Governor Duvvuri Subbarao said yesterday that a more than 9 percent inflation is above “comfort level.”
“The inflation trajectory is not decidedly shifting downwards,” Samiran Chakraborty, a Mumbai based economist at Standard Chartered Plc, said before the report. He expects the Reserve Bank of India to raise its repurchase rate by a quarter of a percentage point to 8.5 percent at its Oct. 25 meeting.
India’s rupee has weakened 8.9 percent against the dollar this year as investors sold stocks in emerging markets because of risks to global growth, making the currency the worst performer in Asia and threatening to boost import costs.
The currency gained 0.1 percent to 49.06 per dollar at 11.47 a.m. in Mumbai. The yield on the 7.8 percent government note due April 2021 rose six basis points, or 0.06 percentage point, to 8.79 percent. The BSE India Sensitive Index advanced 0.6 percent.
‘Comfort Range’
India’s inflation must ease before interest rates can be reduced, Subbarao said Oct. 12. He said on Sept. 26 that price gains will slow by March 2012, “but more slowly than initially expected” and that a rate of 4 percent to 6 percent is the “short-term comfort range” for inflation.
In China, inflation exceeded 6 percent for a fourth month, according to a report today, limiting Premier Wen Jiabao’s room to cut borrowing costs.
By contrast, Brazil and Russia are among the so-called BRIC nations that have either cut rates or injected money into lenders to protect their economies from a possible global slowdown.
“As much as we look at what the other central banks are doing, we take into account our own domestic circumstances and the domestic context in formulating our policy,” Subbarao said yesterday.
Political Issue
Inflation is a political issue in India as it erodes spending power in a nation where the World Bank estimates more than three-quarters of the population live on less than $2 a day.
Subbarao has boosted the central bank’s benchmark rate 12 times since mid-March 2010 by a total of 350 basis points, the fastest round of increases since the Reserve Bank was established in 1935, Bloomberg data show.
That’s curbing consumer demand. Sales at companies including Maruti Suzuki India Ltd. (MSIL), the nation’s biggest carmaker, fell 1.8 percent in September, the third straight monthly decline, the Society of Indian Automobile Manufacturers said Oct. 10.
India’s industrial production rose less than expected in August, according to the Central Statistical Office. Output at factories, utilities and mines increased 4.1 percent from a year earlier, slower than the 4.7 percent median of 20 estimates in a Bloomberg News survey.
The International Monetary Fund last month cut its forecast for India’s economic growth. The South Asian economy will expand 7.8 percent in 2011, the Washington-based lender said, slower than the 8.2 percent projected in June. For 2012, it lowered its estimate to 7.5 percent from 7.8 percent.
“When inflation runs as high as 9.8 percent, it is difficult to bring it down without compromising on growth,” Subbarao said yesterday. “So we are trying the trade-off this time, by bringing down inflation even if it means compromising on growth by a few basis points.”
To contact the reporter on this story: Unni Krishnan in New Delhi at ukrishnan2@bloomberg.net.
To contact the editor responsible for this story: Stephanie Phang at sphang@bloomberg.net
®2011 BLOOMBERG L.P. ALL RIGHTS RESERVED.
Friday, October 14, 2011
Thursday, October 13, 2011
Gold Traders Turn Most Bullish in Three Months After 20% Rout: Commodities By Nicholas Larkin - Oct 13, 2011
Gold’s biggest slump in three years means traders and analysts are now the most bullish in three months, speculating that Europe’s debt crisis, slowing growth and a bear market in equities will drive demand for bullion.
Twenty-two of 25 people surveyed by Bloomberg expect the metal to rise next week, the highest proportion since mid-July. Prices rebounded 8.3 percent since reaching a two-month low at the end of September and investors are adding to their holdings in gold-backed exchange-traded products for the first time in a month, according to data compiled by Bloomberg. Traders also expect gains in copper, sugar, corn and soybeans, surveys show.
Gold slumped as much as 20 percent since reaching a record $1,923.70 an ounce on Sept. 6 as investors sold the metal to cover losses in other markets. As much as $4.2 trillion was erased from the value of global equities in the past month on mounting concern that economies will tip back into recession and European lawmakers will fail to prevent sovereign defaults. The last time traders and analysts were this bullish, bullion surged 21 percent to an all-time high within eight weeks.
“There’s macro-economic, systemic and monetary risk in the world and there’s no sign of that going away any time soon,” said Mark O’Byrne, the Dublin-based executive director of GoldCore Ltd., a brokerage handling everything from quarter- ounce British Sovereigns to one-kilogram (2.2-pound) bars. “All the factors that drove gold to a record are still there.”
Bank of America
Gold advanced 17 percent this year to $1,662.90 by 12:51 p.m. in New York yesterday, heading for an 11th consecutive annual advance. It’s the second-best performer behind gasoil in the Standard & Poor’s GSCI Index of 24 commodities, which fell 2 percent. The MSCI All-Country World Index of equities fell 10 percent and Treasuries returned 7.4 percent, according to a Bank of America Corp. index.
Bullion dropped 11 percent in September, the most since October 2008. That spurred speculators in U.S. futures to cut their net-long position, or bets on higher prices, to the lowest since February by Oct. 4, according to data from the Commodity Futures Trading Commission. They held a net 127,249 futures and options, 13 percent below the average over the past five years.
Investors reduced their holdings in gold-backed ETPs by almost 17 metric tons last month, a pile now valued at about $900 million, data compiled by Bloomberg show. They added 3.4 tons so far this week, taking combined assets to 2,213 tons, more than the holdings of all but four central banks.
Accelerating Purchases
Those central banks are also accelerating their purchases. Thailand, Bolivia and Tajikistan bought a combined 18.2 tons in August, International Monetary Fund data show. The slump in prices means more buying for reserves is “very likely,” according to Edel Tully, a London-based analyst at UBS AG. Central banks are adding to their holdings for a third year, the longest expansion in almost four decades.
The traders and analysts surveyed by Bloomberg are also bullish on copper, which entered a bear market last month after slumping more than 20 percent from a peak in July. Seven of nine people expect prices to rise next week. The metal for delivery in three months, the London Metal Exchange’s benchmark contract, dropped 24 percent to $7,310 a ton this year. Copper reached a 14-month low of $6,635 on Oct. 3 as investors speculated that slowing growth will curb demand for raw materials.
China, the world’s biggest copper consumer, imported the most metal in 16 months in September, customs data show. Diego Hernandez, chief executive officer of Codelco, the largest copper producer, said in an interview in London on Oct. 4 that the Asian nation should take advantage of the slump to restock.
Warehouse Stockpiles
While Barclays Capital cut its forecast for this year’s shortfall in copper supply five times since April, the bank is still predicting a 468,000-ton deficit. That’s enough metal to supply Japan for five months. Stockpiles in warehouses monitored by exchanges in London, Shanghai and New York fell about 8 percent since the end of March, a sign production is still failing to keep up with demand.
“Should debt concerns in the euro zone recede, we are looking to more fundamentally based trading through next year where the likes of copper should benefit,” said Andrey Kryuchenkov, an analyst at VTB Capital in London. “We just need to shake off macro fears and concentrate on market specifics.”
Seven of 12 people surveyed anticipate gains in raw-sugar prices next week and eight said white, or refined, sugar would also advance. Raw sugar traded on ICE Futures U.S. in New York slipped 16 percent this year to 26.91 cents a pound. White sugar traded on NYSE Liffe in London fell 12 percent to $684.10 a ton.
Top Producer
Raw sugar climbed 7 percent this week and white sugar 4.7 percent on speculation that flooding in Thailand, the world’s second-largest shipper, may delay harvests at a time when mills in top producer Brazil are ending their season early.
The Thai sugar harvest may be delayed by two weeks, according to Newedge Group SA. Mills in Brazil’s Sao Paulo state, which accounts for more than 50 percent of the nation’s cane production, started shutting for the season in late September, the earliest in 12 years, because of a smaller crop, according to Celso Junqueira Franco, president of the Union of Biofuel Producers.
Fourteen of 28 people surveyed expect corn to rise next week and 19 of 27 anticipate the same thing for soybeans. Prices for both crops plunged by the most in at least three years last month on prospects for improving harvests. Both commodities rose the most in a year or more on Oct. 11 on the Chicago Board of Trade as traders speculated that declines in September would boost purchases by makers of food, animal feed and biofuels.
“Commodity markets are in the process of bottoming out and I think it may take a little time, maybe a few months, to solidify that bottom,” said James Paulsen, the chief investment strategist at Minneapolis-based Wells Capital Management, which oversees about $360 billion of assets. “You will see commodities going up now. The intensity of commodity selling may be ending and we may be heading in another direction.”
Gold survey results: Bullish: 22 Bearish: 1 Hold: 2
Copper survey results: Bullish: 7 Bearish: 1 Hold: 1
Corn survey results: Bullish: 14 Bearish: 9 Hold: 5
Soybean survey results: Bullish: 19 Bearish: 5 Hold: 3
Raw sugar survey results: Bullish: 7 Bearish: 4 Hold: 1
White sugar survey results: Bullish: 8 Bearish: 3 Hold: 1
White sugar premium results: Widen: 6 Narrow: 2 Neutral: 4
To contact the reporters on this story: Nicholas Larkin in London at nlarkin1@bloomberg.net
To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net
®2011 BLOOMBERG L.P. ALL RIGHTS RESERVED.
Twenty-two of 25 people surveyed by Bloomberg expect the metal to rise next week, the highest proportion since mid-July. Prices rebounded 8.3 percent since reaching a two-month low at the end of September and investors are adding to their holdings in gold-backed exchange-traded products for the first time in a month, according to data compiled by Bloomberg. Traders also expect gains in copper, sugar, corn and soybeans, surveys show.
Gold slumped as much as 20 percent since reaching a record $1,923.70 an ounce on Sept. 6 as investors sold the metal to cover losses in other markets. As much as $4.2 trillion was erased from the value of global equities in the past month on mounting concern that economies will tip back into recession and European lawmakers will fail to prevent sovereign defaults. The last time traders and analysts were this bullish, bullion surged 21 percent to an all-time high within eight weeks.
“There’s macro-economic, systemic and monetary risk in the world and there’s no sign of that going away any time soon,” said Mark O’Byrne, the Dublin-based executive director of GoldCore Ltd., a brokerage handling everything from quarter- ounce British Sovereigns to one-kilogram (2.2-pound) bars. “All the factors that drove gold to a record are still there.”
Bank of America
Gold advanced 17 percent this year to $1,662.90 by 12:51 p.m. in New York yesterday, heading for an 11th consecutive annual advance. It’s the second-best performer behind gasoil in the Standard & Poor’s GSCI Index of 24 commodities, which fell 2 percent. The MSCI All-Country World Index of equities fell 10 percent and Treasuries returned 7.4 percent, according to a Bank of America Corp. index.
Bullion dropped 11 percent in September, the most since October 2008. That spurred speculators in U.S. futures to cut their net-long position, or bets on higher prices, to the lowest since February by Oct. 4, according to data from the Commodity Futures Trading Commission. They held a net 127,249 futures and options, 13 percent below the average over the past five years.
Investors reduced their holdings in gold-backed ETPs by almost 17 metric tons last month, a pile now valued at about $900 million, data compiled by Bloomberg show. They added 3.4 tons so far this week, taking combined assets to 2,213 tons, more than the holdings of all but four central banks.
Accelerating Purchases
Those central banks are also accelerating their purchases. Thailand, Bolivia and Tajikistan bought a combined 18.2 tons in August, International Monetary Fund data show. The slump in prices means more buying for reserves is “very likely,” according to Edel Tully, a London-based analyst at UBS AG. Central banks are adding to their holdings for a third year, the longest expansion in almost four decades.
The traders and analysts surveyed by Bloomberg are also bullish on copper, which entered a bear market last month after slumping more than 20 percent from a peak in July. Seven of nine people expect prices to rise next week. The metal for delivery in three months, the London Metal Exchange’s benchmark contract, dropped 24 percent to $7,310 a ton this year. Copper reached a 14-month low of $6,635 on Oct. 3 as investors speculated that slowing growth will curb demand for raw materials.
China, the world’s biggest copper consumer, imported the most metal in 16 months in September, customs data show. Diego Hernandez, chief executive officer of Codelco, the largest copper producer, said in an interview in London on Oct. 4 that the Asian nation should take advantage of the slump to restock.
Warehouse Stockpiles
While Barclays Capital cut its forecast for this year’s shortfall in copper supply five times since April, the bank is still predicting a 468,000-ton deficit. That’s enough metal to supply Japan for five months. Stockpiles in warehouses monitored by exchanges in London, Shanghai and New York fell about 8 percent since the end of March, a sign production is still failing to keep up with demand.
“Should debt concerns in the euro zone recede, we are looking to more fundamentally based trading through next year where the likes of copper should benefit,” said Andrey Kryuchenkov, an analyst at VTB Capital in London. “We just need to shake off macro fears and concentrate on market specifics.”
Seven of 12 people surveyed anticipate gains in raw-sugar prices next week and eight said white, or refined, sugar would also advance. Raw sugar traded on ICE Futures U.S. in New York slipped 16 percent this year to 26.91 cents a pound. White sugar traded on NYSE Liffe in London fell 12 percent to $684.10 a ton.
Top Producer
Raw sugar climbed 7 percent this week and white sugar 4.7 percent on speculation that flooding in Thailand, the world’s second-largest shipper, may delay harvests at a time when mills in top producer Brazil are ending their season early.
The Thai sugar harvest may be delayed by two weeks, according to Newedge Group SA. Mills in Brazil’s Sao Paulo state, which accounts for more than 50 percent of the nation’s cane production, started shutting for the season in late September, the earliest in 12 years, because of a smaller crop, according to Celso Junqueira Franco, president of the Union of Biofuel Producers.
Fourteen of 28 people surveyed expect corn to rise next week and 19 of 27 anticipate the same thing for soybeans. Prices for both crops plunged by the most in at least three years last month on prospects for improving harvests. Both commodities rose the most in a year or more on Oct. 11 on the Chicago Board of Trade as traders speculated that declines in September would boost purchases by makers of food, animal feed and biofuels.
“Commodity markets are in the process of bottoming out and I think it may take a little time, maybe a few months, to solidify that bottom,” said James Paulsen, the chief investment strategist at Minneapolis-based Wells Capital Management, which oversees about $360 billion of assets. “You will see commodities going up now. The intensity of commodity selling may be ending and we may be heading in another direction.”
Gold survey results: Bullish: 22 Bearish: 1 Hold: 2
Copper survey results: Bullish: 7 Bearish: 1 Hold: 1
Corn survey results: Bullish: 14 Bearish: 9 Hold: 5
Soybean survey results: Bullish: 19 Bearish: 5 Hold: 3
Raw sugar survey results: Bullish: 7 Bearish: 4 Hold: 1
White sugar survey results: Bullish: 8 Bearish: 3 Hold: 1
White sugar premium results: Widen: 6 Narrow: 2 Neutral: 4
To contact the reporters on this story: Nicholas Larkin in London at nlarkin1@bloomberg.net
To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net
®2011 BLOOMBERG L.P. ALL RIGHTS RESERVED.
Wednesday, October 12, 2011
India Inflation Must Ease Before Rates Reduced: Subbarao By Anoop Agrawal and Kartik Goyal - Oct 12, 2011
India’s inflation must ease before the central bank can reduce interest rates, Governor Duvvuri Subbarao said, signaling policy makers may maintain a tight monetary stance for now.
“We are deeply sensitive in making India a low interest- rate regime but that will take time,” Subbarao said in the northern Indian city of Jaipur yesterday. “First, we need to bring inflation down in order to bring interest rates down.”
Emerging-market nations from Brazil to South Korea have turned from fighting price gains to supporting growth as a struggling U.S. recovery and deepening debt crisis in Europe threaten the global economy. In India, the fastest inflation in more than a year is sustaining pressure for higher borrowing costs even as consumer demand wanes.
“Even though there are signs of demand weakening, India’s central bank can’t afford to lower its guard as yet because inflation is at a high level,” said Arun Singh, Mumbai-based senior economist at Dun & Bradstreet Information Services India Pvt. He expects the Reserve Bank of India to raise its repurchase rate by a quarter of a percentage point to 8.5 percent in the Oct. 25 policy meeting.
“Whether we will be pausing the hikes or whether we will be continuing with hiking, it’s not clear,” Subbarao said, adding that he would “consult experts and discuss internally” and announce the decision in this month’s policy review.
India’s 10-year bonds fell at the close in Mumbai yesterday, pushing yields up by 0.03 percentage point to 8.74 percent, near a three-year high, as a government report this week may show inflation held close to a 13-month peak in September.
Weak Currency
The Bombay Stock Exchange Sensitive Index climbed 2.6 percent, and the rupee strengthened 0.8 percent to 48.96 per dollar yesterday. The currency has weakened 8.7 percent this year, the worst performer in Asia, boosting import costs.
“Money is moving out of emerging markets and India and that is putting pressure on the rupee,” Reserve Bank Deputy Governor Subir Gokarn said in Jaipur yesterday, before the central bank’s board meeting today. He said oil and food costs are stoking inflationary pressures in India.
India’s benchmark wholesale-price inflation rate was probably 9.75 percent in September, the median of 20 estimates in a Bloomberg News survey showed. The commerce ministry will release the data on Oct. 14.
Inflation is a political issue in India as it erodes spending power in a nation where the World Bank estimates more than three-quarters of the population live on less than $2 a day.
‘Calibrating’ Rates
“In calibrating interest rates, the RBI takes into account the need of the industry, which wants interest rates low as well as the need of the poor, who want low inflation,” Subbarao said. “We have had to raise rates to combat inflation.”
In his most recent policy decision on Sept. 16, Subbarao raised the central bank’s repurchase rate by a quarter point to 8.25 percent. He said on Sept. 26 that inflation will slow by March 2012, “but more slowly than initially expected.”
The governor in July predicted inflation to ease to 7 percent by March 31. He forecast India’s economy to expand about 8 percent in the year through March from 8.5 percent in the previous year.
Subbarao has boosted the Reserve Bank’s benchmark rate by 350 basis points since mid-March 2010, the fastest round of increases since the central bank was established in 1935, Bloomberg data show.
Consumer Demand
That’s curbing consumer demand. Sales at companies including Maruti Suzuki India Ltd. (MSIL), the nation’s biggest carmaker, fell 1.8 percent in September, the third straight monthly decline, the Society of Indian Automobile Manufacturers said Oct. 10.
India’s industrial production rose less than expected in August, the Central Statistical Office said yesterday. Output at factories, utilities and mines increased 4.1 percent from a year earlier, slower than the 4.7 percent median of 20 estimates in a Bloomberg News survey.
“Bringing inflation under control, that remains and sustains at some comfortable level over a period of time, is the primary objective of our policy,” Gokarn said. “It may cause some disruptions. Moderation of growth is the price we pay but the alternate could be much worse.”
To contact the reporters on this story: Anoop Agrawal in Mumbai at aagrawal8@bloomberg.net; Kartik Goyal in New Delhi at kgoyal@bloomberg.net
To contact the editor responsible for this story: Stephanie Phang at sphang@bloomberg.net
®2011 BLOOMBERG L.P. ALL RIGHTS RESERVED.
“We are deeply sensitive in making India a low interest- rate regime but that will take time,” Subbarao said in the northern Indian city of Jaipur yesterday. “First, we need to bring inflation down in order to bring interest rates down.”
Emerging-market nations from Brazil to South Korea have turned from fighting price gains to supporting growth as a struggling U.S. recovery and deepening debt crisis in Europe threaten the global economy. In India, the fastest inflation in more than a year is sustaining pressure for higher borrowing costs even as consumer demand wanes.
“Even though there are signs of demand weakening, India’s central bank can’t afford to lower its guard as yet because inflation is at a high level,” said Arun Singh, Mumbai-based senior economist at Dun & Bradstreet Information Services India Pvt. He expects the Reserve Bank of India to raise its repurchase rate by a quarter of a percentage point to 8.5 percent in the Oct. 25 policy meeting.
“Whether we will be pausing the hikes or whether we will be continuing with hiking, it’s not clear,” Subbarao said, adding that he would “consult experts and discuss internally” and announce the decision in this month’s policy review.
India’s 10-year bonds fell at the close in Mumbai yesterday, pushing yields up by 0.03 percentage point to 8.74 percent, near a three-year high, as a government report this week may show inflation held close to a 13-month peak in September.
Weak Currency
The Bombay Stock Exchange Sensitive Index climbed 2.6 percent, and the rupee strengthened 0.8 percent to 48.96 per dollar yesterday. The currency has weakened 8.7 percent this year, the worst performer in Asia, boosting import costs.
“Money is moving out of emerging markets and India and that is putting pressure on the rupee,” Reserve Bank Deputy Governor Subir Gokarn said in Jaipur yesterday, before the central bank’s board meeting today. He said oil and food costs are stoking inflationary pressures in India.
India’s benchmark wholesale-price inflation rate was probably 9.75 percent in September, the median of 20 estimates in a Bloomberg News survey showed. The commerce ministry will release the data on Oct. 14.
Inflation is a political issue in India as it erodes spending power in a nation where the World Bank estimates more than three-quarters of the population live on less than $2 a day.
‘Calibrating’ Rates
“In calibrating interest rates, the RBI takes into account the need of the industry, which wants interest rates low as well as the need of the poor, who want low inflation,” Subbarao said. “We have had to raise rates to combat inflation.”
In his most recent policy decision on Sept. 16, Subbarao raised the central bank’s repurchase rate by a quarter point to 8.25 percent. He said on Sept. 26 that inflation will slow by March 2012, “but more slowly than initially expected.”
The governor in July predicted inflation to ease to 7 percent by March 31. He forecast India’s economy to expand about 8 percent in the year through March from 8.5 percent in the previous year.
Subbarao has boosted the Reserve Bank’s benchmark rate by 350 basis points since mid-March 2010, the fastest round of increases since the central bank was established in 1935, Bloomberg data show.
Consumer Demand
That’s curbing consumer demand. Sales at companies including Maruti Suzuki India Ltd. (MSIL), the nation’s biggest carmaker, fell 1.8 percent in September, the third straight monthly decline, the Society of Indian Automobile Manufacturers said Oct. 10.
India’s industrial production rose less than expected in August, the Central Statistical Office said yesterday. Output at factories, utilities and mines increased 4.1 percent from a year earlier, slower than the 4.7 percent median of 20 estimates in a Bloomberg News survey.
“Bringing inflation under control, that remains and sustains at some comfortable level over a period of time, is the primary objective of our policy,” Gokarn said. “It may cause some disruptions. Moderation of growth is the price we pay but the alternate could be much worse.”
To contact the reporters on this story: Anoop Agrawal in Mumbai at aagrawal8@bloomberg.net; Kartik Goyal in New Delhi at kgoyal@bloomberg.net
To contact the editor responsible for this story: Stephanie Phang at sphang@bloomberg.net
®2011 BLOOMBERG L.P. ALL RIGHTS RESERVED.
Tuesday, October 11, 2011
Infosys Profit Beats Estimates After Orders Increase
By Ketaki Gokhale and Shikhar Balwani - Oct 12, 2011
Infosys Ltd., India’s second-largest software exporter, reported second-quarter profit that beat analysts’ estimates as customers raised spending on outsourcing.
Net income rose 9.8 percent to 19.1 billion rupees ($387 million) in the three months ended Sept. 30, or 33.36 rupees a share, from 17.4 billion rupees, or 30.40 rupees, a year earlier, Infosys said in a statement today. That compares with the 18.7 billion rupee median of 35 analysts’ estimates compiled by Bloomberg.
Infosys shares rose the most in a month, leading stocks of Tata Consultancy Services Ltd. (TCS) and Wipro Ltd. (WPRO) higher, after earnings beat expectations for the first time in a year and the company raised full year sales guidance. The Bangalore-based code writer joins Accenture Plc (ACN) in reporting profit that exceeded estimates, as outsourcing demand remains buoyant.
“The dollar revenue outlook for the third quarter and the rupee guidance for the full year are positive,” Rohit Kumar Anand, an analyst at PINC Infinity.com Financial Services Ltd. said by phone. “Expectations were muted, and given that, the markets should react positively to these outlook numbers.”
The shares rose as much as 5.6 percent to 2,644 rupees, the biggest intraday gain since Sept. 14. It changed hands up 4.9 percent as of 9:21 a.m. in Mumbai trading.
Forecast Raised
Sales in the third quarter may range between $1.80 billion and $1.84 billion, Infosys said in the statement. Sales in the year ending in March may range between $7.08 billion and $7.2 billion, compared with a July forecast for as much as $7.3 billion, it said.
Infosys raised the full year sales guidance in rupee terms to between 335 billion rupees and 340.9 billion rupees from an earlier forecast for between 317.8 billion rupees and 323.1 billion rupees.
“The rupee guidance number for the full year seems to be a pretty strong one,” Sanjeev Prasad, an analyst at Kotak Institutional Equities, told Bloomberg UTV today. “A percentage point change in the dollar guidance doesn’t really mean that the world has changed. A 17 percent to 19 percent growth is still a pretty decent number.”
The Indian code-writer renewed an outsourcing contract with Alcoa Inc. for five more years, and sold its banking software to Philippines-based City Saving Bank.
Revenue in the second quarter totaled 81 billion rupees compared with 69.5 billion rupees a year earlier, Infosys said. The company will pay an interim dividend of 15 rupees a share.
“Some companies are hiking their IT budgets for 2012, and by a substantial number, at that,” said Pralay Kumar Das, an analyst with Elara Securities India Pvt. in Mumbai. He has an “accumulate” rating on Infosys stock. “The American incumbent IT players are doing very well, and in fact are raising their guidance. If there’s no reason for them to say demand in Europe and U.S. is falling off, then I don’t see why it should be the case for Indian vendors.”
To contact the reporters on this story: Ketaki Gokhale in Mumbai kgokhale@bloomberg.net; Shikhar Balwani in Mumbai at sbalwani@bloomberg.net
To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net
®2011 BLOOMBERG L.P. ALL RIGHTS RESERVED.
Infosys Ltd., India’s second-largest software exporter, reported second-quarter profit that beat analysts’ estimates as customers raised spending on outsourcing.
Net income rose 9.8 percent to 19.1 billion rupees ($387 million) in the three months ended Sept. 30, or 33.36 rupees a share, from 17.4 billion rupees, or 30.40 rupees, a year earlier, Infosys said in a statement today. That compares with the 18.7 billion rupee median of 35 analysts’ estimates compiled by Bloomberg.
Infosys shares rose the most in a month, leading stocks of Tata Consultancy Services Ltd. (TCS) and Wipro Ltd. (WPRO) higher, after earnings beat expectations for the first time in a year and the company raised full year sales guidance. The Bangalore-based code writer joins Accenture Plc (ACN) in reporting profit that exceeded estimates, as outsourcing demand remains buoyant.
“The dollar revenue outlook for the third quarter and the rupee guidance for the full year are positive,” Rohit Kumar Anand, an analyst at PINC Infinity.com Financial Services Ltd. said by phone. “Expectations were muted, and given that, the markets should react positively to these outlook numbers.”
The shares rose as much as 5.6 percent to 2,644 rupees, the biggest intraday gain since Sept. 14. It changed hands up 4.9 percent as of 9:21 a.m. in Mumbai trading.
Forecast Raised
Sales in the third quarter may range between $1.80 billion and $1.84 billion, Infosys said in the statement. Sales in the year ending in March may range between $7.08 billion and $7.2 billion, compared with a July forecast for as much as $7.3 billion, it said.
Infosys raised the full year sales guidance in rupee terms to between 335 billion rupees and 340.9 billion rupees from an earlier forecast for between 317.8 billion rupees and 323.1 billion rupees.
“The rupee guidance number for the full year seems to be a pretty strong one,” Sanjeev Prasad, an analyst at Kotak Institutional Equities, told Bloomberg UTV today. “A percentage point change in the dollar guidance doesn’t really mean that the world has changed. A 17 percent to 19 percent growth is still a pretty decent number.”
The Indian code-writer renewed an outsourcing contract with Alcoa Inc. for five more years, and sold its banking software to Philippines-based City Saving Bank.
Revenue in the second quarter totaled 81 billion rupees compared with 69.5 billion rupees a year earlier, Infosys said. The company will pay an interim dividend of 15 rupees a share.
“Some companies are hiking their IT budgets for 2012, and by a substantial number, at that,” said Pralay Kumar Das, an analyst with Elara Securities India Pvt. in Mumbai. He has an “accumulate” rating on Infosys stock. “The American incumbent IT players are doing very well, and in fact are raising their guidance. If there’s no reason for them to say demand in Europe and U.S. is falling off, then I don’t see why it should be the case for Indian vendors.”
To contact the reporters on this story: Ketaki Gokhale in Mumbai kgokhale@bloomberg.net; Shikhar Balwani in Mumbai at sbalwani@bloomberg.net
To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net
®2011 BLOOMBERG L.P. ALL RIGHTS RESERVED.
Monday, October 10, 2011
AN ENTERPRISING EDUCATION
* Posted: Tue, Oct 11 2011. 1:00 AM IST
Can entrepreneurship be taught? Can an aspiring business leader learn to choose the right plan, take the right risks, select the right team and then navigate all the turbulence that follows?
With most of the West’s major economies showing sluggish growth at best, many in politics and business are keen to find answers because a new wave of energetic entrepreneurs is urgently needed to kick-start trade all over the world, shake up the markets and create jobs.
In my experience, success as an entrepreneur depends upon a fairly unusual combination of personality traits and instinctive skills, most of which can only be honed on the job.
Formal coursework is not enough. Most beginning entrepreneurs need the kind of guidance that only a trusted mentor can provide.
It’s critical that experienced executives and CEOs volunteer to coach young entrepreneurs in their communities: this is one of the most immediately rewarding and concrete way successful business leaders can foster economic growth in their region.
There are many young entrepreneurs who, if they are given the critical boost of great advice as they launch their start-ups, will someday bring in new jobs. To find a mentoring group in your area, consult local universities, industry groups and small-business development centres.
Through our foundation Virgin Unite, and with the sponsorship of Virgin businesses and local companies, our team has set up two Branson centres of entrepreneurship, non-profit organizations where entrepreneurs, mentors, community members and investors can gather to discuss projects, learn practical skills and spread the word about their ideas.
Since we set up the first Branson centre in Johannesburg, South Africa, six years ago, more than 100 entrepreneurs have taken part in our programme; and, at present, 11 of their businesses are in operation, employing many people.
One of our recent “graduates” is Lesego Malatsi, a fashion designer and entrepreneur whose stunning designs were showcased at London Fashion Week in September.
We opened the second school in Jamaica just a few weeks ago. The new class of 15 people is working on launching businesses in industries ranging from hospitality to education services to recycling.
Do you know someone trying to start a business? As a mentor, there are six things you should keep in mind:
1. A good coach tells it straight
Your most important job is to help a beginning entrepreneur cut through confusion and misinformation to the truth. The evaluations may be intensely personal: what sort of leadership style does she have? What can she do to improve? It may be difficult for your mentee to hear your critical comments, but you must explain very clearly what is going wrong.
2. Build a mentoring team
Many entrepreneurs need help in more than one area. My dyslexia made keeping accounts difficult when I was young; so a family friend, who was an accountant, stepped in and helped me. His advice was crucial in helping me to understand how things worked and how to run a business. If you are not able to provide all the advice your mentee needs, help her find someone who can.
3. Teach boldness
When the founders of our centre in Jamaica evaluated prospective students for the current class, they found that all of those who applied identified obtaining better access to capital through our programme as a key goal, but only 14% had asked for a loan.
In different cultures, there are different barriers to approaching prospective investors; almost everyone needs advice and help in this area. Share your experiences, review the pitches and practice approaches.
4. Make the introductions
Start-ups often struggle to attract customers and then to keep costs under control as orders increase. Access to investors makes all the difference for many businesses.
Be prepared to call industry contacts and old friends from university; whatever it takes to help your mentee connect with those who will see the potential of her business, just like you do.
5. Get that message out
When I was just getting started in business, Sir Freddie Laker, the famed British airline founder, advised me to build company promotions around my own personality—a strategy that has worked well for Virgin. He believed that small entrepreneurial businesses could survive and prosper if they were known about and marketed properly. Potential marketing opportunities are often overlooked by newcomers—it may be up to you to point out the possibilities.
6. Persistence is key
Setting up businesses is a risky occupation. It is important that we help newcomers understand that an early venture’s failure is a badge of experience, not the end of one’s career; that the most important thing to do if things go wrong is to bounce back.
BY NYT SYNDICATE
©2011/RICHARD BRANSON
Do you know what it takes to coach an entrepreneur to success? Let’s share more best practices. Please write to me at richard.branson@nytimes.com and let me know how you are helping entrepreneurs in your community.
Richard Branson is the founder of the Virgin Group and companies such as Virgin Atlantic, Virgin America, Virgin Mobile and Virgin Active. He maintains a blog at www.virgin.com/richard-branson/blog
Copyright © 2007 HT Media All Rights Reserved
0312B1AA-C9AD-821F-F68D-0DF87C0B2D21
Can entrepreneurship be taught? Can an aspiring business leader learn to choose the right plan, take the right risks, select the right team and then navigate all the turbulence that follows?
With most of the West’s major economies showing sluggish growth at best, many in politics and business are keen to find answers because a new wave of energetic entrepreneurs is urgently needed to kick-start trade all over the world, shake up the markets and create jobs.
In my experience, success as an entrepreneur depends upon a fairly unusual combination of personality traits and instinctive skills, most of which can only be honed on the job.
Formal coursework is not enough. Most beginning entrepreneurs need the kind of guidance that only a trusted mentor can provide.
It’s critical that experienced executives and CEOs volunteer to coach young entrepreneurs in their communities: this is one of the most immediately rewarding and concrete way successful business leaders can foster economic growth in their region.
There are many young entrepreneurs who, if they are given the critical boost of great advice as they launch their start-ups, will someday bring in new jobs. To find a mentoring group in your area, consult local universities, industry groups and small-business development centres.
Through our foundation Virgin Unite, and with the sponsorship of Virgin businesses and local companies, our team has set up two Branson centres of entrepreneurship, non-profit organizations where entrepreneurs, mentors, community members and investors can gather to discuss projects, learn practical skills and spread the word about their ideas.
Since we set up the first Branson centre in Johannesburg, South Africa, six years ago, more than 100 entrepreneurs have taken part in our programme; and, at present, 11 of their businesses are in operation, employing many people.
One of our recent “graduates” is Lesego Malatsi, a fashion designer and entrepreneur whose stunning designs were showcased at London Fashion Week in September.
We opened the second school in Jamaica just a few weeks ago. The new class of 15 people is working on launching businesses in industries ranging from hospitality to education services to recycling.
Do you know someone trying to start a business? As a mentor, there are six things you should keep in mind:
1. A good coach tells it straight
Your most important job is to help a beginning entrepreneur cut through confusion and misinformation to the truth. The evaluations may be intensely personal: what sort of leadership style does she have? What can she do to improve? It may be difficult for your mentee to hear your critical comments, but you must explain very clearly what is going wrong.
2. Build a mentoring team
Many entrepreneurs need help in more than one area. My dyslexia made keeping accounts difficult when I was young; so a family friend, who was an accountant, stepped in and helped me. His advice was crucial in helping me to understand how things worked and how to run a business. If you are not able to provide all the advice your mentee needs, help her find someone who can.
3. Teach boldness
When the founders of our centre in Jamaica evaluated prospective students for the current class, they found that all of those who applied identified obtaining better access to capital through our programme as a key goal, but only 14% had asked for a loan.
In different cultures, there are different barriers to approaching prospective investors; almost everyone needs advice and help in this area. Share your experiences, review the pitches and practice approaches.
4. Make the introductions
Start-ups often struggle to attract customers and then to keep costs under control as orders increase. Access to investors makes all the difference for many businesses.
Be prepared to call industry contacts and old friends from university; whatever it takes to help your mentee connect with those who will see the potential of her business, just like you do.
5. Get that message out
When I was just getting started in business, Sir Freddie Laker, the famed British airline founder, advised me to build company promotions around my own personality—a strategy that has worked well for Virgin. He believed that small entrepreneurial businesses could survive and prosper if they were known about and marketed properly. Potential marketing opportunities are often overlooked by newcomers—it may be up to you to point out the possibilities.
6. Persistence is key
Setting up businesses is a risky occupation. It is important that we help newcomers understand that an early venture’s failure is a badge of experience, not the end of one’s career; that the most important thing to do if things go wrong is to bounce back.
BY NYT SYNDICATE
©2011/RICHARD BRANSON
Do you know what it takes to coach an entrepreneur to success? Let’s share more best practices. Please write to me at richard.branson@nytimes.com and let me know how you are helping entrepreneurs in your community.
Richard Branson is the founder of the Virgin Group and companies such as Virgin Atlantic, Virgin America, Virgin Mobile and Virgin Active. He maintains a blog at www.virgin.com/richard-branson/blog
Copyright © 2007 HT Media All Rights Reserved
0312B1AA-C9AD-821F-F68D-0DF87C0B2D21
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