June 2023 Newsletter

Morgan Stanley Report

Based on the report Direct Transfer of Benefits, Bankruptcy Formalization, Infrastructure investments, Inflation stabilization, Objective transfer of Benefits to Corporates and Global Sentiments has helped India grow at a very steady pace for the past 10 years. Experts cite that stable leadership and continue focus on these would help the growth trajectory of India in the next 20 years. We believe that NRI’s will be benefitted if they are exposed to India in 2 ways. Firstly, currency depreciation that has happened for the past 10 years will slow down and secondly, growth in earnings from corporates will give greater returns.  

Communications Sector in India:

The government, with its new injection of funds to BSNL, is trying to put some skin into the game and stir competition. This is one of the sectors that was most hyped but most hit by bad policies and politics from 2009. No company is making a clean profit, and many have sold their business or merged. But look at the potential, India is already the 2^nd largest telecom market and supposed to grow at 8 – 10% CAGR. Well, how will the already dominant players like Bharati, Reliance Jio and Idea make money? By creating consolidation and increasing the prices steadily. We see these businesses as cash flow machines over time.

Investing in Mutual Funds:

Total Assets Under Management by all 42 Mutual fund houses currently stands at 500 billion $. It is a 10-fold increase in the past 10 years. To make a comparison the largest Asset Manager Blackrock has an AUM of 9 trillion $ which is 18 times the current AUM. There is a huge growth trajectory to achieve and its needed to bring down the management fees cost and better research content on markets by these Asset Managers. Currently is very contained and speculative. There are some spectacular fund managers and their funds whom we track and get in touch with us to know more.

Property Tax help:

Calculation of Property tax for owned property would vary greatly based on where the property is located. Every state has its own policies for charging property taxes and every state property tax. Most states have rebates if paid early and hefty fines if paid later. Also, property taxes cannot be claimed back in your tax filings since these come under the laws of the state government. We can help you with filing your taxes.

Key Personal finance term – Rebalancing:

As your portfolio value changes over time it’s imperative to adjust it. This method of adjusting the equity, debt and cash allocation of your overall portfolio is called Rebalancing. It’s recommended to do a rebalancing on your birthday to make sure you are not out of track of your allocation. Allocation from equities to fixed income assets increases as you grow older.