Interview

Investment Banking
Deepika Jain
Today’s position in M & A
 Background: India gained independence in 1947,
after two centuries of British colonial rule.

 Partition at the same time created the state of

Pakistan, with which India has fought three wars, two
over the disputed territory of Kashmir. India is the
second-most populous country in the world, with
nearly 1.1bn people in 2006. Its economy is the 12th-
largest in the world measured in nominal US dollars,
but rises to third-largest when measured at
purchasing power parity exchange rates. The large
(and inefficient) public sector co-exists with a sizeable
and diversified private sector.

Today India
 Politicalstructure:
India has been a democracy since independence. The
growing importance of regional parties has made
coalition government the norm at the federal level.
Democratic procedures are, on the whole, respected.
The prime minister is the head of government,
requiring the support of a majority in the national
parliament. The president is the head of state, and
although limited in executive power, can influence the
formation of governments at both state and national
levels when no party has gained an outright majority.
The judiciary is formally independent, and is
becoming increasingly assertive.

Today India
Policy issues:

The booming economy is allowing the government to

undertake big spending programs at the same time as
reducing the fiscal deficit.

The government has been forced to abandon its

disinvestment process at the behest of the mainly
communist Left Front parties. Although it has
managed to push through some liberalizing
measures, many important economic reforms have
been put on hold in response to the demands of
coalition politics.

Today India
Taxation:
The top rate of personal income tax and
corporation tax for Indian companies is 30%. The
corporation tax rate for foreign companies is
40%. However, a complex system of exemptions
reduces the effective tax rate for Indian
companies to less than 20%. All firms pay a 10%
tax on distributed profits. Customs duties have
been lowered substantially but remain high by
international standards.

Today India
Foreign trade:

India's trade deficit rose to US$61.2bn in 2006 in

balance-of-payments terms, up from US$46.9bn in
2005. Exports performed strongly, rising by 20% to
US$123.2bn, but imports jumped by 24% to
US$184.4bn, largely owing to higher international oil
prices and to demand for industrial inputs and
consumer goods.

The US remains India's largest trading partner,

although China is India's leading supplier and its
third-largest export market.

Today India
Economic fact sheet
Key indicators 2007 2008 2009 2010 2011 2012

Real GDP growth (%) 8 7.9 7.4 7.4 7.5 7.5

Consumer price inflation 6.2 5.6 5.2 5.1 5 5

(av; %)

Budget balance (% of -3.3 -3 -2.8 -2.6 -2.5 -2.3

GDP)
Current-account balance -1.2 -1.5 -1.3 -1.3 -1.6 -2
(% of GDP)

Lending rate (av; %) 13.1 12.9 12 11 10 10

Exchange rate Rs:US$ 41.2 38.4 37.4 36.5 36 35.5

(av)
Exchange rate Rs:¥100 35.1 36.5 38.8 39 39.2 38.7
(av)
Your view on Sector-Retail
(Question asked by Prof Kakani)
 Indian retail industry is ranked among top 10 retail market
 Retailing contributes to 10% of GDP
 Largest contributor to the GDP but is highly fragmented
only 4% is organized
 huge investment is expected by the organised players,
resulting in the expansion of its share to 15–18% by 2011–
12
 The industry is expected to post operating profit growth of
78% with OPM of 9.6%, an expansion of 184 basis points
as against OND06
 Provogue, Pantaloon and Trent are expected to register a
growth of around 40.89%, 61.84% and 12.24%
respectively in net sales for OND07
 Read for more details…..

Adobe Acrobat
Document
 Describe your SGP?

 What are your interests and hobbies?

 Which sector is good and what is your view

on the same? (already provided you with
my view)

 Which stocks are of your interest and why?

Question asked by prof.

Thank You