No matter, how gloomy the markets looked a day before Diwali last year, they have given the best possible returns in history.
How do things appear this new year ? With a record appreciation under their belt, investors are extremely bullish at this point of time. It is important that investors do not get carried away and use discretion in investing.
While the Q2 results are still not out in large numbers to decipher what the trend is, but the advance tax numbers that came in on 15th September show a very robust growth in the Net Profit. The markets will now like to see, whether this higher profit was on account of higher sales or just the plain oil trick of cutting costs and other income. If the sales are as robust as the bottom line, the markets can see another leg up. Otherwise, some flab shedding is on the cards.
As we move into the next Samvat, it is essential to look at those sectors which are going to see higher sales and therefore higher profits for the companies.
The Road Sector : Green Signal
This is one sector that will see tremendous growth. While our road network of 33 lakh kilometers is slightly larger than China, we do not have adequate fast moving highways. Around 32% of our National Highway network is single laned. That means there is enough room for road growth as these have not only to be made double lane but four or six lanes at some other places.
When it comes to express ways, we have just around 200 Km of that , as compared to 65,000 Km in China. Here comes another statistics, 45% of our road traffic is carried by just 2% of our roads. Then there is the issue of congestion. While the road network in India is growing at a miniscule per cent per annum, the vehicle population is increasing at a rate of 12 per cent. Therefore, large investments are required to increase and upgrade the Indian road infrastructure, something that will take care of the present needs and also of the foreseeable future.
With China becoming a nuisance, it is imperative that our border road network is enlarged and made all weather proof.
It is with this back ground that you should read the diktat by the Surface Transport Minister , Kamal Nath , that we make 20 km a day of roads. The present rate is 2 km a day. Assuming that we actually make only 10 km a day, it means 5 fold increase. That would mean that companies that build and operate highways and the ones that make the road equipment will do well.
GIS : The way forward
Geographic Information System or GIS , that is not even considered a sector today is the one to back. GIS is a computer based tool with a multi-disciplinary approach, capable of functions like collection, storage, retrieval, manipulation/analysis, updating an display of spatial data.
The kind of growth we saw in the software sector in the 1997-2000 period is something that will happen in this sector. Companies that capture this data, companies that sell the software to manipulate this data and companies that provide enterprise solutions to Defence, Municipal, Irrigation, Soil Survey, Rural Development, Geology, Mineral Resources, Water Resources, Agriculture, Forestry, Transportation, Mining, Town planning, Environment, Topographical & Cadastral Surveys and the ones that make consumer level applications will rake in cash like anything in the days to come.
I have spoken about the Gas pipeline sector earlier. The companies that own the pipelines, the companies that lay these pipelines, both will benefit in the next three years. Here’s wishing that the new Samvat carries on the good times that you have had in the past seven months
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