A time to give revised IIP a chance

The IIP growth of 6% for the month (5.9%) over October's 5% contraction was not such a puzzle, esp manufacturing growth in 6.6% and durables remaining 11% during the festival month despite good October inventories (probably) that did not show up int he OCtober's pessimistic numbers. Probably more than another revision IIP needs careful seasonal adjustments to match up to frequent monthly and year on year comparisons which have both lost meaning

The pick up in Cap Goods and transportation sub sector is apparently from Boeing orders , as in the US scenario. And that wild swing from -25.5% to +4.6% in Capital Goods/infrstructure alone is enough to whittle one's reality check if one uses IIP. Mining again volatile at just 4.4%, and the infosys results will make an apprearaance here as a special treat for those still tracking the IT sector wilfully,

October IIP fwas revised to -4.7%, non durables and Electricity growth in November highly satisfactory at 11.2% and 14.6%, basic goods from 0% to 6.3%, intermediate goods to flat from -6%

A time for Infosys, past

The cut of growth estimates to 16% and a last clarion call from Infosys( before going down) for high quality revenues led by consulting as CTS shines up on the horizon wihtth low cost high volumes and TCS maintains the domestic lead

Infy wants growth from Europe (touche) and 5 large deals were signed in thwe quarter for $500 mln value, one in Europe. Margins are good for Infy and hedging for less than half the revenues at $877 mln. Sales were $1.8 bln , forecast for Q4 flat at the same $1.80 bln and expecting yoy growth to end at $7.05 bln revenues in March 2013

Also funnily, the management team just about managed to not sppeak about growth in banking and financial services but then the sector remains key, we believe also nearshoring is more key than you would believe in such a key Outsourcing insdustry thus Accenture outscoring Infy by 5:1 in coming bids and wins despite the "potential" for this industry,. Between CTS and Accenture's growth (outside India) Indian IT is up for recalibration or individually for Infy and HCL Tech

 

Posted via email from The India Investment Post