HDFC Bank's A. Aima (L) & Motilal Oswal Securities' R. Agrawal: Upbeat mood

Boom Times Ahead
FII interest in India can only intensify. Look out for new all-time highs for stockmarket indices.

If 2003 saw the highest ever inflows of foreign institutional money, they could easily get bigger in the coming year. As Abhay Aima, Country Head, Equities & Private Banking Group at HDFC Bank, puts it: "What is huge for us isn't internationally. That is because what we get now is (still) minuscule." What should continue to benefit India and emerging markets is the pressure on the US dollar. "That's because the US has a huge current account deficit (currently placed at around 6 per cent of GDP)," says Raamdeo Agrawal, Managing Director, Motilal Oswal Securities.

So where could the Sensex be headed, if flows similar to the $7 billion-plus of 2003 continue? Nobody's talking about 6000 levels any more. Aima is upbeat that the 30-share index will cross the previous all-time high of 6150 during 2004. And if liquidity is not an issue, the fundamentals too look good. Corporate results are expected to be excellent at least for the first two quarters of 2004. The budget too will be reforms-oriented, what with 2004 being an election year. The BJP, encouraged by its victories in the assembly elections on the reforms plank, will obviously be wise enough to intensify that thrust. What should also help, as Agrawal adds, is that the selling pressure (from Indian financial institutions) is more or less over. So any way you look at it, it's boom times ahead.

-Narendra Nathan

Hyundai Getz: All set to hit the road

Driving Into India
Expect some new car makers to enter the country in 2004.

Three new car brands may find their way onto Indian roads in 2004. Volkswagen, Nissan, and BMW are tipped to be bringing their products into India. BMW plans to launch the 3-Series and 5-Series and Nissan may bring its sports utility vehicle Extrail. Hyundai Motor India will finally launch Getz in the B+ or the Fiat Palio segment. Hyundai is hoping to sell over 3,500 units of Getz each month after its launch (in mid-2004). The company would also be launching the Elantra. Also expected are the new Honda Accord V6, Toyota Vios, Indigo Estate, Chevrolet Tovrea, and Ford Fusion.

In bikes, both Bajaj Auto and TVS are launching indigenously-developed products to take on Hero Honda's warhorse Splendor. While Bajaj is launching a bike codenamed S1 in April and another 100 cc bike (codenamed K60) in June, TVS would be launching Electra in mid-2004. Market leader Hero Honda, incidentally, has only a new variant of Ambition up its sleeves for 2004. This could be the year in which when Honda Motorcycles and Scooters India (a 100 per cent subsidiary of Honda Motor Corp of Japan) launches motorcycles. And with the Hero group's joint venture with Honda Motor of Japan coming up for renewal in March 2004, tables may turn in the motorcycle market.

-Swati Prasad

The Year Of The IPO
There'll be plenty of public issues to subscribe to.

If you've missed out on the stockmarket rally, and can only helplessly watch the Sensex gallop towards 6000 and beyond, there's still a way to get in and make some decent returns. After all, it's now time for the primary markets to get a dose of the action, and initial public offerings (IPOs) provide a great (and safe) route for investors to get into stocks. The number of IPOs expected in the New Year would be more than enough to satiate the hungry appetites of investors. "There would be a lot of opportunities for investment since monies in excess of Rs 30,000 crore are expected to be collected from the IPO market in 2004," says Prithvi Haldea, MD, Prime Database. A warning from Haldea, though: Be cautious when the IPO rage becomes a frenzy.

-Shilpa Nayak

The Numbers Look Good
Corporate results will continue to please, Q after Q.

Automobiles: The industry has been growing comfortably in double digits on the back of domestic demand. And it looks immensely sustainable. "Auto companies should grow by 15-20 per cent for the next two to three years" says Nimish Shah, Director, Parag Parikh Financial Advisory Services.

IT: Billing rates are beginning to stabilise, and the margin pressure that plagued the it services sector for long seems to be over. "The earlier strategy of competing on price is getting replaced by value added (innovation) services", explains Ganesh Natarajan, CEO, Zensar Technologies.

Pharma: Though there was a small blip in the September-ended quarter of 2003, pharma companies are expected to report good numbers in the coming years. "The factors that drive this will be exports picking up and the increased domestic demand", says Bhavin Chheda, Pharma Analyst at Pioneer Intermediaries.

Banking: Banks may witness a slowdown, as the long rally in the gilt market has just reversed (during the quarter ended December). Private banks won't be too badly affected, though, since the treasury income component is small for them.

-Narendra Nathan

No More Pie In The Sky
CAS and DTH could finally become realities in 2004.

Much like a clichéd saas-bahu serial, cable operators, multi-service operators and giant broadcasters have been fighting battles (during most of 2003) for and against the launch of conditional access in the country. And so far, the broadcasters have been successful in scuttling the launch of CAS, which has, at present only happened in select pockets of the country. Some like Zee and Star, on the other hand, are fine-tuning their direct-to-home strategies. Zee launched its DTH services on October 2, 2003, which according to a company spokesperson, has over 50,000 subscribers. An aggressive marketing and advertising plan will roll-out early next year.

With the introduction of CAS and DTH, the number of cable homes may grow even further. As of today, 45 million homes in the country have access to cable TV (total number of TV homes is approximately 85 million), up from 20 million in 2000. By 2007, this number is expected to grow to 64 million. The idiot box rules.

-Swati Prasad

Soap opera: They might just get a bit more progressive

More Power To The Weepy
The family soap will continue to rule the roost.

They've ruled the idiot box for a couple of years, but what's starting to affect the popularity of once-hot saas-bahu soaps like Kahaani Ghar Ghar Kii and Kyunki...Saas Bhi Kabhi Bahu Thee are the arrival of fresher concepts, like Jassi Jaisi Koi Nahin on Sony, the story of a clumsy, but intelligent secretary. But that doesn't necessarily mark the end of the saas-bahu theme. At least that's what Sameer Nair, Chief Operating Officer, Star India, believes: "The soap is a story telling device about Indian families," he observes. Sunil Lulla, Executive Vice President, Sony TV, feels, "there will be a change towards more competitive and compelling alternative programming".

A recent survey revealed that almost 50 per cent of the respondents considered the character of Tulsi (from KSBKBT) as their role model even though they voted heavily in favour of an equal marriage and an independent career. The saas-bahu syndrome will go on, albeit with some much-needed, progressive amendments.

-Supriya Shrinate

Budget 2004-05 Revealed
Even if it's vote-on-account, expect the reforms thrust to continue.

Here's what to expect on February 28. Hopefully it won't be another 135-minute crawl. But in defence of Finance Minister Jaswant Singh, you'd have to admit that he'll have a lot to say in an election year, even if it's not a full-fledged budget and just a vote-on-account. "No prizes for guessing it will be a populist-cum-reforms-oriented budget," as a finance ministry official puts it. And once budget is announced, peak tariffs will be rationalised to 20 per cent or so, from the existing 25 per cent limits. The focus again will be on reducing import duties on various commodities, especially steel, copper, aluminium, etc, whose prices have virtually gone through the roof in recent times. The hardware sector could see a reduction in excise duty from 16 per cent to 8 per cent, and the 4 per cent special additional duty (sad) could be done away with. The focus on hardware also stems from the fact that the previous Budget's special focus on textiles, healthcare, housing, and auto has paid handsome dividend. "Tax cuts (read government intervention) in these sectors have worked,'' avers a senior finance ministry official.

Another proposal is to do away with the 2.5 per cent surcharge on corporate tax and to promote India as an investment centre through greater liberalisation of policies. Then there will be the usual populist measures like greater spend on agriculture and rural sector (development of wasteland, capital expenditure in agricultural growth and expansion of irrigation and value addition of agricultural produce). Subsidies on food and fertilisers won't of course be tinkered with. The thrust on infrastructure-creation will continue, with ports getting special attention. But what is it that industry wants? Says Anand Mahindra, Managing Director, Mahindra & Mahindra: "A pragmatic, reform-oriented, forward-looking budget.'' That's all?

-Ashish Gupta

Year Of The Indian Tiger
In 2004, India will be the place to do business in.

G. Kliesteriee: Banking on exports from India

Circa 2004 is the year of the monkey according to the Chinese calendar. But as far as business goes, it could well be the year of the Indian tiger, a year in which the world finally starts speaking of "India with China'' in the same breadth-both in terms of growth opportunities and a great place to do business in.

The positives of the world's second fastest growing economy (slated to grow at 7.3 per cent in 2003-04) are now being heard louder in the first world: Relatively undervalued stocks, an appreciating rupee, strong corporate performance, low interest rate, a billion dollars in forex, and a huge domestic market are just some of them.

"What has also changed is the brand image of the country and a new-found confidence among Indian corporates to take on the world, ''contends Jyoti Jaipuria, Head (Research), DSP Merrill Lynch. That's why G. Kliesterlee, CEO, Philips, is looking to ramp up exports from India in the next three to five years. There will be many more like him.

-Ashish Gupta

Power tussle: Sonia Gandhi (L) & Atal Bihari Vajpayee

Clean Sweep?
The BJP-led coalition is the favourite to win the elections.

Most likely by september a billion-plus people will cast their vote to elect some 545 members of Parliament in the 14th Lok Sabha elections. And the two big national parties-the BJP and the Congress Party-along with their alliance partners will be slugging it out to gain that magic 270-plus seats to form the government.

One likely scenario: The BJP comes back to power with a slight majority, albeit with a little help from its National Democratic Alliance (NDA) partners. Expect then to see a speeding up of the reforms process, contends Kashi Memani, Chairman, Ernst & Young. Reason: Not only is the BJP convinced that good economics translates into good politics-a lesson well learnt from the assembly elections-it will also have no fear of facing any elections in the near future. "Moreover, it will also get greater support from the allied parties, which are also convinced about the efficacy of reforms,'' adds Memani.

So, expect a consolidation of reforms, even attempts at tackling the second generation of reforms and greater consensus building on disinvestment issues, if (or rather when) the BJP is returned to power.

-Ashish Gupta

Shakeout Season
There will no more than five big players jostling for a pie of 60 million wireless subscribers by year-end.

The Leviathans: Bharti Televentures and Reliance Infocomm will leverage their all India presence. Bharti will fuel growth inorganically. Reliance will launch of the much popular pre-paid cards and enterprise products to grow numbers.

Tata Group: Has recently acquired almost a dozen new licences for offering CDMA-based telephony taking the total number of licences to 17. Expect it to grab a larger share in 2004.

BSNL: In a league of its own is the government-owned behemoth Bharat Sanchar Nigam Limited. The planned network expansion is likely to see it recapturing its place in the sun.

Hutch: Deep pockets will ensure survival.

-Vandana Gombar