Wednesday, July 25, 2007

Can't keep my hands off you, baby...

Déjà vu. Earlier it was the NDA government that fingered India's oil marketing companies IOC, HPCL and BPCL. Then the game was between Ram Naik, Petroleum minister and Arun Shourie, Minister for Disinvestment. Ram Naik opposed privatization of Oil PSUs (needed the fleet of cars, trucks and guest houses for his election campaign, used his power to allot petrol pumps and gas agencies to his cronies) whereas pro-reform Arun Shourie (believed the Government had no business in running businesses) was hell bent on privatizing them. As and when Arun Shourie opened his mouth, the markets loved it and stock prices of Oil PSUs went up ; and they tanked when Ram Naik countered – giving you a clear weekly arbitrage opportunity.

Recently the `idearupt' govt. spooked the market cap of Sugar industry - wanting to smart one up on inflation, it banned exports in an year of record output at the cane fields - by over 70%. Now its guns train cement stocks.
When P.Chidambaram, the Harvard educated, charming Finance Minister of India (FM), spoke to the press after the Budget 2007 presentation in Parliament, he cautioned the Cement companies on profiteering. Cement companies did not heed him and upped the prices citing higher demand and higher input costs. Then came the the May 17 debacle. Hardly had the market recovered in cement stocks from that shock, India’s trade practices regulator MRTPC on Tuesday ordered a probe into the business practices of 14 leading cement manufacturers. These manufacturers colluded to hike prices, alleges a preliminary report by MRTPC’s investigative wing.

Big business is sex and FM is a charmer. Nothing will keep the two away for long…

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