The Slack Discussions

The Slack group at Capital Mind Premium has been extremely active and if you haven’t been there, pop us a note by replying to this email. (If you’re a trial member this probably sound like Greek to you; it will be available when you sign up!)

A brief summary of some of the interesting things discussed there in the last few days:

#general: EPFO revives bid to club allowances with basic pay

Field offices told to inspect establishments that may be structuring salaries in such a way as to cut PF liabilities. (Link)

#macronomics: It’s official: Japan’s population is dramatically shrinking

It’s finally happened. After years, if not decades, of warnings about Japan’s aging population and its low birth rate, the day is here. Japan’s official census shows that the country’s population has shrunk.

And not by an inconsiderable amount either: The 2010 census showed a population of 128,057,352, but the 2015 figure, released Friday, shows just 127,110,000. (Link)

#general: Macro Eco Survey 2016: See room for at least 50 bps RBI rate cut, says Panagariya

He says sticking to the fiscal consolidation target will be taken positively, adding he has always pitched for a rate cut and if the fiscal deficit target is achieved then the Reserve Bank will get more room to cut rates. He feels the process should begin with at least 50 basis points cut.(Link)

#general: You smelt it right, Railways washes blankets every two months

If your railway blanket smells like it hasn’t been washed in a month or two, well, it hasn’t. And confirmation comes from MoS railways Manoj Sinha, who admitted in Rajya Sabha on Friday that blankets are washed every two months. (Link)

#general: Morgan Stanley marks down Flipkart shares value by 27%

A mutual fund managed by Morgan Stanley has marked down the value of Flipkart’s shares by 27%, signalling that global investors believe India’s largest internet company is overvalued. The markdown comes even as mutual funds slash the value of some of Silicon Valley’s most high-profile start-ups like messaging app Snapchat and data-analysis company Palantir Technologies Inc.  (Link)

#general: EPFO tightens norms for withdrawal of Provident Fund

Retirement fund body EPFO has tightened norms on withdrawal of provident fund as well investment of such amount in Varishtha Pension Bima Yojana for it’s over five crore subscribers.

“Now, the subscribers will not be able to claim withdrawal of their provident fund after attaining age of 54 years. They would have to wait till attaining the age 57 years. The ministry has notified new rules,” a senior official told. (Link)

#general: Leap of faith – Despite benign economic conditions, India faces tricky budget decisions

(Link)

#general: Dormant employee provident fund account may earn interest

In a sudden development, the government has introduced restrictions for withdrawing funds from your own employee provident fund account. The age limit for withdrawal on retirement has been increased from 55 years to 58 and only partial early withdrawal is now permitted.(Link)

#general: China Stocks Tumble Toward 15-Month Low as Stimulus Bets Unwind

Chinese stocks sank, with the benchmark index approaching the lowest level since November 2014, as some investors were disappointed by a lack of specific measures to boost growth during the Group of 20 meeting in Shanghai.

The Shanghai Composite Index dropped 3.5 percent, after tumbling as much as 4.4 percent earlier. Declines were led by commodity producers and technology companies. The measure has lost 25 percent this year, the worst performer among 93 global equity gauges, on concern capital outflows will accelerate as the economic slowdown deepens. The yuan headed for its longest losing streak this year. (Link)

#general: Mississauga forex promoter says he was kidnapped, beaten

Online entrepreneur facing class-action lawsuit blames mysterious incident on unnamed rival company. (Link)

#stocks: Birla’s UltraTech buys JP’s cement plants for Rs 16,500 cr

UltraTech Cement said it entered into a binding Memorandum of Understanding with Jaiprakash Associates Limited for the acquisition of its identified cement plants having total cement capacity of 22.4 MTPA (million tons per annum). (Link)

#stocks: Value of two Indian suppliers to Islamic State doubled during conflict

Two of the three listed companies in India, named in Conflict Armament Research (CAR) report on the sources of materials used by Islamic State (IS) forces, doubled in market value during the period of ascendance of the terrorist group.

CAR, nominated by European Union to investigate weapon supplies to the terrorist group, had named seven Indian companies in its report titled “Tracing the Supply of Components Used in Islamic State IEDs.” These companies were part of a larger group of 51 companies from 20 countries, from which the components for improvised explosive devices (IEDs) were sourced by the IS. (Link)

#general: Where is Indian aviation headed?

Getting some crucial steps right would greatly contribute to India’s successful future in domestic aviation (Link)

#general: Laveesh Bhandari: It’s time for civil aviation reform to take off

Incumbents in the airline industry are said to be up in arms against the proposed civil aviation policy changes. While incumbents typically oppose any liberalisation or reform that encourages competition, they rarely threaten court action. While that is a moot possibility, a government on the back-foot due to a sustained growth slowdown, may be pushed into an ill-considered backtracking on its proposal. (Link)

#general: Budget removes DDT hurdle to make real estate investment trusts a reality

Arun Jaitley also proposed a 100% tax deduction to undertakings for construction of affordable housing. (Link)

#stocks: Smartlink Network up 17%; to consider buyback on Feb 29

The company’s board meeting will be held on February 29, 2016 to consider the proposal to buyback the fully paid-up equity shares of face value Rs 2 of the Company. (Link)

#general: Mister Jaitley’s Mid-Course Correction

It should now be clear that when it comes to economic policy, there is no major difference between Modi and his predecessors. (Link)

#general: The World’s Most Popular Stock Picks Are Sinking

A successful strategy to avoid the worst of this year’s equity retreat: ask your analyst what to buy and sell, then do the opposite.

The stocks most beloved by strategists around the world, from U.S. game maker Activision Blizzard Inc. to Chinese electrical appliances maker Midea Group Co., have fallen 11 percent in 2016 on average. Companies ranked at the bottom of the heap by analysts are down 3.4 percent, data compiled by Bloomberg show. (Link)

#general: Opinion: The Neo-Middle Class Is Not This Budget’s Favourite

(Link)

#backtobasics:

Budget Recap by Deepak Shenoy – Link

Currency Wars with Amit Gupta – Link

P/E Ratio Analysis of Nifty – February 2016 update – Link

PDF is evil: Extracting Tabular Data from PDFs – Link

Scalping Link

Trading stocks with Camarilla pivots – Link

What they don’t teach you at Business Schools (Harvard or not) – Link

Disclaimer

Nothing in this newsletter is financial advice and should not be construed as such. Please do not take trading decisions based solely on the matter above; if you do, it is entirely at your own risk without any liability to Capital Mind. This is educational or informational matter only, and is provided as an opinion.

Disclosure: The authors at Capital Mind have positions in the market and some of them may support or contradict the material given above, or may involve a direction derived from independent analysis.