Hello,

For Prabhat Awasthi, getting it wrong a few times isn't such a big deal-as long as he's getting it right most of the times. "Consistency and humility are most important. If one has made a wrong call, one should be able to muster the courage to change it. On the other hand, you also need to have the conviction to stick to your belief. Even if the whole world is screaming "sell" and you're convinced of a buy, you should stand by your belief," points out the Vice President & Senior Analyst at J.P. Morgan India.

For the past nine years as an analyst, at such broking houses as SSKI, J.M. Morgan Stanley and, for the past three and half years, at J.P. Morgan, you could safely conclude that Awasthi has been getting it right fairly consistently. His favourite call is his recommendation at the time of the initial public offering of Bharti Tele. Having put a buy at Rs 34, Awasthi watched the stock plummet to Rs 20 after hitting a high of Rs 45. But Awasthi remained bullish and in fact changed his call from neutral to overweight. Today, the Bharti stock is trading at around Rs 160. Yet, Awasthi is aware of the pressure put on analysts to make the right call every time. "How is that possible when even the companies often themselves aren't aware of how things will pan out?" smiles the soft-spoken engineer, who makes it a point to meet (telecom) vendors and (auto) dealers to corroborate management-talk. Awasthi's dose of wisdom to budding analysts: "Don't get carried away by stock momentum. Once you've reached your target, call it a day."

-Brian Carvalho

The Hobbyist
MANISH SAXENA 34
Assistant Vice-President, ICICI Securities
SECTORS: Cement, Engineering, Metals

Early 2003, the SARS threat was holding the world hostage, and most analysts were bearish on steel. Manish Saxena wasn't. That may have something to do with his beginnings in the steel industry, something that he believes helps him understand the infrastructure sector better. Or it could be the analytic approach of the electrical engineer from VJTI, Mumbai, who also holds a post-graduate degree from the Institute of Chartered Financial Analysts of India (ICFAI). "Ethical management, long-term strategy of the management, the enthusiasm displayed by the management, systems, risk management, and transparency" are some of the things Saxena considers while analysing a company. His best recommendations: Tata Steel three years ago (Rs 70) and last year again (Rs 160, and the stock trades at Rs 380 today); L&T (Rs 200 and the stock trades at Rs 600 today); and BHEL last year (at Rs 160 and the stock trades at Rs 600 today). And while tracking stocks may be his vocation, understanding the market is his hobby.

-Shilpa Nayak

Calling The Right Numbers
MANISH SRIVASTAVA 34
Assistant Director & Co-head (Asian Telecom Research), ABN Amro
SECTORS: Telecommunications

He may be based in Singapore but you are likely to spot Manish Srivastava at New Delhi's Ghaffar Market, India's biggest grey market for new phones and most happening market for second-hand ones, or in Jakarta's shopping malls. These visits help the IIM-A alum figure out the dynamics of the used-phone market. The second-hand market, reasons Srivastava, drives the telecommunication services business. And so, the man who has covered sectors as diverse as media, cement, banking, and automotive for brokerages such as CLSA and SSKI, and who shifted to Singapore in the second half of 2003 doesn't visit the offices of telcos as often as he once used to even as he tracks seven large companies in the region. You see, Ghaffar Market holds the key!

-Roshni Jayakar

An Egghead On The Street
C. VISALAKSHI 34
Senior Analyst, Kotak Securities
SECTORS: Pharmaceuticals

If things had turned out differently, C. Visalakshi would have remained a research scientist in the pharma industry. After a graduate degree in chemical technology and a post-graduate one in finance, she started her career as a research scientist at Cipla. Then came the shift to equity analysis, "There aren't too many pharma analysts with industry background," she says, explaining how she fits into the trade. As someone who has worked in the industry, Visalakshi has been able to spot trends well before others. For instance, in May 2003, she put out a Buy on Divi's Lab at Rs 366 (now hovering around Rs 1,500) based on her understanding of the emerging trend of outsourcing. She was proved right.

-Narendra Nathan

High-Performing Asset
AMIT RAJPAL 30
Managing Director, Morgan Stanley
SECTORS: Banking, Finance

From an, er, humble "associate" at J.M. Morgan Stanley, Amit Rajpal has clearly come a very long way in a very short span of time. The MBA from IIM-Calcutta (with a degree in cost accounting to boot), who started covering financial stocks in India, today heads Morgan Stanley's Asian financial research team (including Australia and Japan), besides day-to-day coverage of the Hong Kong markets (where he is based), along with a "detailed oversight"-now, now, don't go by the dictionary meaning of "oversight," this is analyst-speak for you-of the Indian market.

If you're still wondering why a chunk of the analysts on our "best" list is from the global investment banks, it's pretty simple actually. The global banks provide opportunities Indian broking houses can only dream of, and conversely the Wall Street firms would logically be hiring only the best in the business. Rajpal, for instance, covers two global banks out of Hongkong, HSBC and Standard Chartered, along with local banks such as Bank of China and Hang Seng Bank. His other responsibilities include writing thematic work for financial stocks in the entire Asian region, including India. "For somebody from India, the advantage of working in Hong Kong is tremendous because one can put the 'India' knowledge into a global/regional context...It is easier to describe the evolution of financial services in India vis a vis other comparable markets," says Rajpal, who plays a bit of squash, tennis, and cricket when he isn't sifting through NPAs and ledgers.

-Brian Carvalho

Globe Trotter
SATISH JAIN 36
Vice President, Morgan Stanley
SECTORS: Auto and Capital Goods

For four years he was an unsung engineer at the Godrej group. Then, Satish Jain got his MBA from IIM-B, and for three years did the grind at Bajaj Auto's corporate finance division, handling treasury activities and special projects. The markets beckoned soon after and Jain did a two-year stint at ASK Raymond James as a senior research analyst, before slipping into the Vice President's seat, covering auto and capital goods, at Morgan Stanley. "I work closely with the regional and global auto teams for global research," explains Jain, who was the team leader for Asia-Pacific Autos in 2003.

To be sure, being with a global investment bank throws up huge opportunities for growth and learnings. Jain, for instance-who at the time of writing was in San Francisco-has attended global conferences in London and New York, as well as some auto shows. He's also travelled with the Morgan Stanley global team to China and Korea. "We also do frequent joint calls for clients on global autos. Interacting with the global team, global companies and global clients in various countries is a huge advantage at Morgan Stanley."

The man is extremely bullish on Indian auto's growth story; "primarily because of the structural changes taking place-construction of highways, lower interest rates, wider availability of cheaper financing, rising income levels, lower vehicle prices... and more importantly, the cost and quality of Indian companies now make them globally competitive," says Jain, who believes valuations are still attractive, notwithstanding the previous year's spurt.

-Brian Carvalho

Visiting Analyst
MADHUSUDAN BAGREE 32
Director, Citigroup Smith Barney
SECTORS: Pharma, FMCG

In the second half of last year, Madhusudan Bagree, issued a 'sell' call on some large pharma companies. Their business models were sound, but Bagree believed happenings in the macro-environment could affect their earnings. His negative call stood out, but those who heeded his call may find themselves laughing all the way to the bank now. As Bagree says: ''You have to look ahead and not generate assumptions based on the past." An engineer from University of Roorkee and MBA in finance and marketing from XLRI, Jamshedpur, Bagree started his career at ICICI Securities in 1996 as a consumer sector analyst and moved to CLSA to track the pharma sector as well before joining Citigroup Smith Barney in 2000. Bagree speaks to each of the companies he covers-all the large pharma and fast moving consumer goods ones and then some-at least once a week, and visits them every alternate month. For Bagree, who loves cooking and travelling, things couldn't be better: both sectors have strong global linkages that often takes him places.

-Roshni Jayakar

His Credit Is Good
PATHIK GANDOTRA 33
Head of Research, SSKI
SECTORS: Banking, Finance

If Pathik Gandotra is considered one of the country's best banking analysts, he has his seven-year stint at credit rating firm CRISIL-he was heading the finance sector rating division when he left-to thank for it. Ergo, by the time he signed on with SSKI, he knew all there was to know about most Indian banks (30-40) and finance companies (some 150 of them). "Rating agencies interact closely with banks," explains Gandotra. "My CRISIL stint helped me acquire a better perspective about the banking and finance industry." So, it isn't altogether surprising that the MBA from MS University, Baroda, was early to spot the resurgence in India's public sector banks, at a time when most analysts were not so bullish on the same. One of his recommendations, Punjab National Bank, for instance, has seen its stock zoom from Rs 69 in January 2003 to around Rs 330 today. "Management is the most important factor in banking," he says. And identifying bank managements with the ability to balance risk and growth, the ultimate analyst-thing.

-Narendra Nathan

Work And Play
BHARAT IYER 35
Director, Citigroup Smith Barney
SECTORS: Automotive, Engineering, Capital Goods, Utilities

The twain meet for Bharat Iyer, a motor sports enthusiast who covers, among other things, the automotive sector. A MBA from the University of Poona, Iyer came to Smith Barney from the IIT Investrust (he was with UBS Warburg before that). The man has his approach planned to a T (he rattles off, for our benefit, the details he looks for in the auto segment: market potential, segment-performance, market shares, planned launches, and the like), talks to each company he covers at least once a month and visits them thrice a year. With 10 large companies and five small ones on his radar that leaves him little time to indulge his passions of tennis and motor sports. Still, he gets to cover auto!

-Roshni Jayakar

The Obsessive Tracker
ABHAY LAIJAWALA 37
Vice President, Citigroup Smith Barney
SECTORS: Cement, Metals

He makes what he terms "maintenance calls" to the companies he tracks every week. When there's something brewing the number could go as high as three calls a day. And he regularly interacts with global analysts on his beats (especially metals) to extrapolate global trends to the Indian scenario. Tracking companies isn't just a vocation for Abhay Laijawala, a MBA from the University of Rhode Island; it is an obsession. So much so that he will tell you that to be "first among equals you have got to be on your heels, keep your ears open so as to get that extra piece of news on the sector or the company". This analyst has completed the circle: he started off as an analyst at BZW in 1994 and moved into investment banking and did time at HSBC and DSP Merrill Lynch before returning to research at Smith Barney. "To be counted, you have to go that extra mile," he says. That, he has.

-Roshni Jayakar

Star Analyst, Star Sectors
SANJEEV PRASAD 34
Senior Analyst, Kotak Securities
SECTORS: Energy, Chemicals, Media, Telecommunications

Most analysts would give anything to be in Sanjeev Prasad's shoes. The IIT-Delhi, IIM-Calcutta alum has spent the past eight years at Kotak and in association with analysts from Goldman Sachs (the two firms have an alliance of sorts) covers the most happening companies in, arguably, the most happening sectors-Prasad actually heads the investment research teams in the four sectors named. Prasad's is a numbers-heavy approach: he maps the strengths and weaknesses of each company within its industry and predicts future free cash flows, discounts these to arrive at valuations, and corroborates the result with a cross-country comparison with similar companies. And "it needs a minimum of 15 per cent upside from the current price," as he puts it, for him to put out a Buy. Remember, this is the man who recommended HPCL and BPCL in November 2000 when their scrips were trading at around Rs 100. Today, the two stocks are quoting at Rs 480-levels. We're all for math-heavy approaches.

-Narendra Nathan

P for Prozac, P for Perfect
*MANISH JAIN 33
Senior Vice President, Research, DSP Merrill Lynch
SECTORS: Pharmaceuticals, Healthcare

In 2000, when Dr Reddy's was involved in litigation with Pfizer over a generic version of the latter's best-selling anti-depression drug Prozac, the estimated future stock price numbers on Manish Jain's report were 80 per cent higher than those on reports issued by other analysts. Jain, reports go, was sure that Dr Reddy's would win. Win the company did and its stock shot up over 100 per cent. Jain is said to be of the view that a good analyst needs to first get his views and perspectives clear. Part of the India Research team, under Jyoti Jaipuria, which was rated No. 2 in Institutional Investor's 2003 Asia Research Team poll, Jain has a MBA in Finance from Narsee Monjee Institute of Management Studies. And the next time the numbers on his report are different from that on others, you can bet your bottom dollar that everyone is going to go by his estimate.

-Abir Pal

Matrix Reloaded
SANJAY CHAWLA 37
Senior Analyst, Motilal Oswal Securities
SECTORS: Pharma

In early 2003, Sanjay Chawla put out a buy on matrix Laboratories. The scrip was quoting at Rs 330 then and most analysts believed it was already over-valued. Chawla didn't think so. He was of the opinion that investors could benefit from the gap between reality (the company's fundamentals) and market perception. He was proved right: the stock trades around Rs 1,440 today. The veteran analyst-the Master of Management Studies from bits, Pilani, has spent 10 years in the trade in firms as diverse as IDBI Capital Markets, SMIFS Securities, and IIT Investrust-is a pharma specialist: his first major success was his recommendation of Sun Pharma in 1994; the stock turned out a tenbagger. Right now, Chawla is honing up his technical analysis skills apart from trying to understand the psychology of stock trading.

-Narendra Nathan

The Quiet Persuader
JAL IRANI 35
Vice President, ICICI Securities
SECTORS: Oil & Gas, Textiles

Jal Irani was travelling and couldn't respond to BT's questions. The 11-year veteran of the trade has covered sectors as diverse as oil & gas, textiles, shipping, fast moving consumer goods, automotive, steel, power, and shipping in his career. And one fund manager vouches for Irani's ability at writing "persuasive" reports.

-Shilpa Nayak

The Fastest Gun on the Street
*ABHAY SHANBAG NA NA
HSBC Securities
SECTOR: Pharmaceuticals

One fund manager swears by Abhay Shanbag's speed of coverage. That, his impressive sweep of pharma, and some sterling recommendations earn him a spot among the best analysts in the business.

-Shilpa Nayak

Power Broker
*VIDYADHAR GINDE NA NA
HSBC Securities
SECTOR: Energy

Could his be the best hit rate? One fund manager thinks so and adds that most calls made by Vidyadhar Ginde in the past 18 months have been right. And others point to the frequency of his reports (high) as evidence of his continued and in-depth analysis of the sector.

-Shilpa Nayak

Petrochemical Predictor
*SONAL JAIN 36
Sr. Investment Analyst, CLSA
SECTORS: Fast Moving Consumer Goods, Petrochemicals

Sonal Jain was among the first to predict the recent surge in petroleum refining margins. Over the past couple of years, the MBA from Bombay University has also made fairly accurate predictions of petrochemical cycles. That's something.

-Narendra Nathan

Energy-lifer
SUSANTA MAZUMDAR 35
Director (Research), UBS Warburg
SECTORS: Oil & Gas, Metals, Petrochemicals, Power, Telecommunications

It somehow seems apt that a petroleum engineer from Dhanbad's Indian School of Mines who started his career at ONGC ends up as one of India's top energy-sector analysts. That's the route Susanta Mazumdar, a MBA from IIM-A has taken: engineering school to business school to ICICI (project finance with an emphasis on petroleum projects) to equity analysis. Mazumdar, who has been associated with the Indian energy sector this past 12 years, confesses that he has a weakness for fundamentals. "What I understand is the fundamentals of the industry," he says. "And I only concentrate on it; it is like playing cricket-if one knows batting better, he should concentrate on it." It is this approach that helped Mazumdar spot the ONGC Videsh story much before anyone else did. Maybe more industry-veterans need to get into equity analysis.

-Narendra Nathan

The Value Investor
SRINIVAS RAO RAVURI 31
Senior Analyst, Motilal Oswal Securities
SECTORS: Power, Engineering

Srinivas Rao Ravuri is an analyst who fits well into Motilal Oswal's philosophy of value-investing. And so, the MBA from Hyderabad's Osmania University starts off his study of companies by meeting people (not just execs from the company, but others from the industry, including those in the smallest of firms). Then he sits down, tries to understand the structural changes in the industry, and uses the discounted free cash flow approach to arrive at a valuation. "As the value is linked to the sustainability of earnings growth, the main focus is to make sure that the company has a sustainable competitive advantage," says Rao. The man hit the jackpot with his recommendation of BHEL (at Rs 150) in October 2001. The power sector was going through some structural changes and BHEL held a near-monopoly in the supply of generating equipment, he says, explaining his recommendation. It all sounds so simple in hindsight but remember, Rao said this in 2001.

-Narendra Nathan

The power Is With Him
*AJAY SHARMA 28
Senior Investment Analyst, CLSA
SECTOR: Pharmaceuticals

This young analyst (just four years of research experience) came to limelight with his detailed report on the emergence of Indian pharma companies as a force in the global generic market titled Attack of the Clones. Not surprisingly, he has a bachelors degree in pharma in addition to a MBA from IIM-A.

-Narendra Nathan

HOW WE DID IT?

We identified the best analysts by way of a fund manager survey. We approached the CIO/Head (Equities) of all big mutual funds (with assets under management exceeding Rs 1,000 crore) and asked them to nominate five equity analysts across industries and equity houses. Only analysts with multiple references were selected. A close look at the winners will reveal a subtle, but significant trend of industry experts getting into equity research. Susanta Mazumdar (started his career as an engineer at ONGC) and C. Visalakshi (started her career as a research scientist at Cipla) are the best examples of this. P.S: We did try a conventional scientific approach by requesting all large equity firms to provide us with all reports published by them in 2003 but this wasn't forthcoming. The project was coordinated by BT's Chief Analyst Narendra Nathan.

*These five analysts did not speak to BT for this story