My Budget Musings…

My Budget Musings…

My views on the Budget must matter very little to you,but it may matter a lot to you .what Great Speakers like Nani Palkiwala used to advise after every Budget!

I sincerely used to go and sit watching that great Budget Analysis of Nani Palkhiwala at Anna Auditorium..He was so sharp witted that he always took pride in addressing the audience at Madras

London Stock Exchange 1845

London Stock Exchange 1845

“It is always a pleasure to address this audience of all, as I firmly believe that Madras is the epitome of Financial Brain of all over the World!”(Meaning we have produced th bst CAs!)

He narrated some incidents after Manmohan Singh’s 1991 Budget ,when the Market started skyrocketing,which I wd like to recall here..german stock exch1845

He said  ‘Markets react based on Rumours and I wd like to quote from this Book (I forget that book he showed one published in 1780s!)..german se1845

  1. “this co advertises that they are going to make the best Muslin cloth from Cobwebs..and they came for public issue..It was over subscribed by 100 times..”
  2. “This is another co., which advertised that they have found a new method to convert copper into Gold..This was oversubsribed by 70 times!”germen stock exc1895

So much was the craze for stocks that everyone and anyone could get away with Bagfull of Gold at that time!”said Palkhiwala,cautioning the educated elite of Madras to be very very cautious.

I used to read sincerely all articles on Stocks from the Days of Leo’s Column in the Hindu in 1975,(Leo’s real name is Narasimhan,a blind man who used to ask his assisstant to read out the Balance Shets and write offhand to Hindu..One of the outstanding Stock Mkt Journalists of India) to the modern day Baligas and Tulsians!

But Leo was always the best man who used to write in a subtle way in the last few lines of his column,

“Looks optimistic”..means buy!

In 1975 in a matter of 3 weeks he reocmmended 3 stocks which was coming for Pub Issue..

1)Nirlon Synthetics..He recommended strong Buy..so I bought!

2)ITC..recommended BUY..So I bought

3)Reliance Industries..He wrote ‘when some of the Textile Mills in Bombay haven’t reached Rs100 crores after nearly 100 Yrs,here is a co., which had a turnover of Rs67 Lacs in 1967 already touching Rs100 Crores..There must be something good for the shareholders in the offing!”

So I bought and made huge money on all these stocks..

Infact Nirlon gave a 5:4 Bonus within a year which was a History at that time in a conservative,Marawaris controlled Stocks Exchanges!It went into BIFR in the 80s too!

In 1992 One Yessesway,the great Financial Analyst addressed after the MMS budget..He was predicting that Honey will start flowing in PalarRiver..

People were after every thing in Bombay Stock Exchange..

I used to do a bit of reading and I remember a critic in Economic Times wrote about the Caze..

He said “There is this Co., called Karnataka Bearings..The stock is ruling at Rs42..I don’t know how this co., is valued at 42 when what this co., needs right now is Rs 3 worth of Cocoanut Oil..as the Lock in the front gate is so rusted that even to open this co., we need only that much Oil!”

I immediately sold it at Rs 48..similarly some Bhulwaika Steel and all others!

Next day the stock market crashed ,thanks to a man called Harshad Mehta!

I recall Chadda,assistant in Vnkatraman&co., telling me next day

“How did you predict so well and got out of all your stocks last week?”

I said “One must be happy with a reasonable profits!”

I saw in front of Chaddha an old Iyer with all his pension locked up unwanted stocks like Karnataka Bearings!I felt very sad for him!

My experience(again I am a novice!)in Indian stock Market is

“When you see Profit better Book it Right now..Time will not wait for you!”

There was a time when prediction was possible based on stats and rationality..

In 1975 again I asked my borker in Coimbatore,Mr.S.K.Renganathan to buy me 100 shares of Laxmi Mills!

He asked me “Why Sir when all Mills are doing so badly?”

I told him “SKR..see their BS..from 1935,every once in 5 yrs they have given a Bonus.In 1970 they cdn’t give Bonus.Their Boardmeeting is in 2 months..I expect a sure Bonus this time..Thats why!”

I got the Bonus from Laxmi but more than that SKR gave a ring and said

“Sir..you are too Good to be True..”

Well all of you must be thinking I wd have amassed a fortune…!

No way..I shd have continued in Stock Market a bit more sincerely!

PC’s Budget is Not a Budget..

after all,even a 3rd std student can balance and write:

8-4=32-28….

India is yet to see an innovative Budget to take it forward beyond China..

We have the potential but we don’t have the will power!

But we always Shout from Davos to United Nations,that India is superior to China..Only we shout..None in the world Notices..even your stock mkt indices

don’t even appear in Bloombergs and CNBCs!

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About s.rajah iyer

An MBA.. Interested in writing,Reading..Indian Philosophy
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