We derive a great amount of satisfaction from the feeling that we have been able to guide investors well, having appropriately suggested through this column in the preceding issue that they should go long on the market. 

When I wrote the edit for the previous issue (DSIJ Vol. 27, Issue No. 3, dated Jan 16-29, 2012), the Sensex was at 16175. While writing this piece, it is at 17000+ levels, yielding handsome returns in one fortnight. What readers would appreciate is that we have been quite blunt in our comment on the market. Let me reproduce what I said in the last issue: “I would suggest that you close your short positions and go long, if possible”. For yet another time, Dalal Street Investment Journal has guided investors accurately

The obvious question that would be bothering investors now is should one continue to remain long on the market or take some profits off the table. We would go with the latter view and suggest that investors should book some profits. This is despite the Reserve Bank of India having cut the CRR by 50 basis points and given enough indications that the interest rates could remain soft from here on. The reasons why we advise you to book profits now is that there are a few points of uncertainty that would continue to act as speed breakers for the market.

First, the elections in five states will be underway in the next few days. These are crucial, as the government’s decision to push reforms would depend on the outcome of these state elections. Any setback to the UPA government in any of these states would mean that the government is too weak to push reforms, and this could spoil the sentiment. On the other hand, global economic health continues to remain fragile. The proof of this lies in the fact that very recently, the IMF lowered its projection for global GDP growth to 3.3 per cent from the previous four per cent. 

Also, Iran could make crude oil prices spurt, throwing India’s calculations on the fiscal deficit front haywire. In addition, the finance budget this year may be a little harsh in order to mop up tax revenues, and the government may also decide to completely roll back the stimulus package that was given at the time of the Lehman crises. Another factor to be considered is that India Inc.’s earnings for the December quarter are not very exciting (neither are they too bad). Hence, before FIIs decide to put a premium on India, they would wait for the March numbers to take a call. 

This time, our cover story looks at the kind of investments that India can attract from FIIs in the current calendar year. In the cover story, our senior research analyst Shashikant suggests that India should receive good inflows from FIIs, as there are four strong reasons why India would be an interesting investment destination. This is an interesting story for the market, and particularly so for those who are interested in tracking FII investment flows.

This issue also carries a Content Survey (page no. 41) to understand readers’ expectations from the magazine. Being India’s #1 investment magazine, it is our duty to give what our readers want from us. I would sincerely request you to share your honest and frank feedback with us, as you have been doing in the past, to make this exercise meaningful. I thank you in advance for your participation.