The winner of Bharti Airtel’s expansion into Africa

Recently, Bharti Airtel shares hit a six year low.One big reason was the under performance of its African operations.It admitted that its loss-making African operations, which it acquired from Kuwait’s Zain in a $9-billion debt-funded deal in 2010, may not meet its target of $5 billion in revenues and $2 billion in core earnings, for the year to March 31, 2013.

Now, there is another company whose stock is near its all time highs.This company has recorded its highest ever revenues and highest ever profits.

The company is Amara Raja Batteries.While both its automotive and industrial batteries segments are doing well, it has gained on account of its supplier relationship with Bharti.

According to its press release dated 28 May, 2012, “Exports in the industrial battery business have been growing significantly in the last couple of years aided by surge in demand through the expansion of Bharti Airtel’s networks in Africa.

So next time an Indian major makes a major acquisition overseas, look closely at its suppliers.The stock price action would probably happen there !!

What was that again?

No management with a credible character would file a criminal case against the authors of a research report. They are trying to show to the market place, and I paraphrase here, ‘The man with the biggest stick gets to take the buffalo home’. They have forgotten that in global capital markets, the intellectual capital of Veritas and other organisations similar to ours is the opinion maker, and the key deciding factor in allocation of capital.India can’t become a superpower by stifling debate. If a company can’t stand up to scrutiny, then it needs new management that can engage and debate.”-said Veritas analyst Neeraj Monga about Indiabulls

Linkfest:August 13, 2012

Some stuff I am reading today morning:

Flight of no return:Kingfisger loss widens (Firstpost)

Drought relief, poll freebies will widen fiscal deficit (ET)

Investing for dividends (ValueInvestorIndia)

Oriental Carbon and Chemicals – Mgmt meet (Dalal-Street)

Explaining Equity Returns (GMO)

5 part IQ test to make you a better investor (MarketWatch)

Chinese bank’s weapons of mass ponzi (FTAlphaville)