Infosys ADR premium at the lowest levels

Infosys ADR Premium is at the lowest levels currently. Major reason for this fall in ADR price (based on study of the components used in calculations of premium since guidance for FY2007) shows that Prices has ADR has fallen more sharply than prices in local stock exchanges and this coupled with appreciation in INR by 5.6% has resulted in lowest level of premium in Infosys.

Increase/Decrease since guidance of Infosys

1. ADR prices of INFY has fallen by (6.8%)

2. INR/$ has appreciated by 5.6%

3. Prices on BSE has fallen by (3.9%)

Technically speaking it should have been otherwise - that is fall in local exchanges should have been more, since the interest rates in India are more and for similar amount of risk – risk premium paid in Indian bourses is less and vice-a-versa on foreign bourses. So as per me do keep away from large cap IT stocks as in market correction there would be stepper correction in Large cap IT stocks . As currently sentiments in Indian market look upbeat and major news flows are positive this is providing major support to this stocks.

Raw Sugar May Reach Lowest Since 2004, ED&F Man Says (Update1)

May 4 (Bloomberg) -- Raw sugar will drop to a two-and-a- half-year low of 8 cents a pound because of increasing production in Brazil, India, Russia and Pakistan, said ED&F Man Holdings Ltd., the world's biggest trader of the sweetener.

Global output will exceed demand by 9.8 million metric tons this year after growers expanded plantings to take advantage of a 25-year high in prices last year, London-based ED&F Man said in a report today. Brazil will produce 30.9 million tons, leaving a 20.4 million-ton domestic surplus. India will have a 5.5 million- ton surplus and may export as much as 1.2 million tons.

The outlook for raw and refined sugar prices ``remains rather bleak,'' analysts led by John Ireland, head of sugar research for ED&F in London, said in the report. ``A good start to the current Brazilian crop and even higher estimates for the forthcoming crops in the key regions makes the scenario bearish for the coming months.''

Raw sugar for July delivery on the New York Board of Trade gained 6 cents, or 0.7 percent, to 9.35 cents a pound as of 8:41 a.m. local time. Raw sugar has dropped 45 percent in a year. Eight cents would be the lowest since Sept. 10, 2004. The ED&F analysts didn't say when they expect that price.

White sugar for August delivery climbed $4.70, or 1.5 percent, to $317.50 a ton on Euronext.liffe in London, giving refined sugar a premium of $111 over raw. The premium stood at $83 on Jan. 3. The European Union has shipped less than 700,000 tons on export licenses since Oct. 1, down from 4.9 million tons by this time last year, ED&F said.

Refining Capacity

The 27-nation EU is cutting its production to comply with a ruling by the World Trade Organization limiting the amount of the sweetener the bloc can export. The cuts will lead to a temporary shortfall in white sugar until new refining capacity comes on stream, mostly in the Middle East and North Africa, ED&F said.

``In terms of the white premium, we expect it to remain well supported for the time being given the ongoing structural deficit in the refined sugar market,'' the report said.

Russia, the world's biggest importer of sugar, has more than doubled its sugar beet plantings to 504,300 hectares (1.25 million acres), compared with 284,000 by this time last year, ED&F said. The country is forecast to import 17 percent less sugar this year, at 2.5 million tons.

Pakistan, which imported 1.5 million tons of sugar last year, may have reached self-sufficiency this year, following a forecast 30 percent increase in its sugar production to 3.6 million tons and higher than expected inventories from last year, ED&F said.

A record crop is forecast for Brazil's centre-south region, which accounts for 85 percent of the country's cane output. The harvest, which started last month, may yield 416.5 million tons, in turn producing almost 27.4 million tons of sugar, the report said. The country is expected to produce 31.9 million tons in total in the 2007-2008 season.

3,500-year-old investment tips that still work!

 A book was cast in stone more than 3,500 years ago in Babylon and was found by a British professor late last century. What impressed him -- and helped him come out of a debt crisis -- were the inscriptions on how to manage one's finances.

The book is now available as The Richest Man of Babylon. It's a very small book, but with some very profound thoughts.

1. Pay yourself first: When we think of budgeting against our income, we typically look at our expenses: how much do I have to pay my landlord, my grocery bills, my medical expenses, my entertainment bills, et cetera. Once we have decided on our expenses, we find out what our savings will be.

Financial advisors and many credit card companies (or banks) today help clients in estimating their lifestyle expenses and help them understand where their money is being spent.

The old book turns this theory on its head: it says 'pay yourself first.' Before you pay others for the services that they give you, you should save money for yourself. You are working for yourself and not just for paying your bills and, hence, you should receive a fair share of your income for yourself.

The Richest Man of Babylon decrees that you should pay a minimum of 10% of whatever you earn to yourself. And the best thing is: once you have paid yourself, you will realise that your lifestyle does not change at all!

2. Make your money work harder: The Richest Man of Babylon says that the only way for your money to grow is if it procreates. Using a wonderful analogy, it states that the money saved -- and invested -- is the father and it should bear children. The joy -- and the secret to financial independence -- lies in seeing the children grow bigger than the father.

It is very instructive to learn the difference between savings and investments. Indians typically 'save' a lot -- as demonstrated by the savings to GDP ratio of around 30%. However, in many cases, savings do not translate into investments, which earn returns.

3. Take calculated risks -- but do take them: It is not always that the best intentions produce the best results. After having saved for one year as decreed by The Richest Man in the book, his disciple gave all his money to a merchant who was to go into far seas in search of the spices. Neither the boat, nor the man returned and all the savings of the disciple were lost.

While it is important -- rather it is a prerequisite -- that you need to take some risks to earn returns on your savings, you need to be careful in evaluating the risks that you can/should take. The first thing that you need to understand is the amount of risk that you are able and willing to take. It is easy to confuse between the ability and willingness -- and this is where you will need the assistance of your financial advisor.

Depending on your circumstances, you should define the amount and nature of risks that you can take. If you are nearing your retirement and have painstakingly built your nest-egg over your working life, it is important for you to ensure safety of your principal.

Conversely, if you are young and without responsibilities, you can risk your savings for higher returns.

4. Be persistent: After losing the money with the sea merchant, the disciple wanted to give up on saving and investment, saying that it is an illusory game leading to losses and pain. The Richest Man warned him not to lose heart and to continue the process year after year throughout his life. When the disciple invested -- more cautiously -- the second time, he not only received his principal back, but also received handsome interest.

It is easy to be lost in the maze of headlines and advisors who talk about the uncertainties in the markets and their abilities to time and make more money out of it. While one can try to get that extra return by tactically optimising on the portfolio allocations, what should not be lost sight of is that the mantra to investment success is to be disciplined.

There will be shocks on the way, but it is important that your savings are working for you.

It is surprising how the logic of wealth-creation written down millennia ago is still relevant today. The British archeologist who found these stone tablets was in a debt crisis, with credit card companies knocking at his door daily. By following the simple dictates above, he not only made his life debt-free, but set out on a path to financial independence!