Look to understand!

One of the best ways to look at potential opportunities is to look at the environment around oneself and one can see how well the economy and get a hint of how specific companies are doing and will do.

Here are 11 such examples:

1. More foreigners in markets and airports indicate better room utilization and potential increases in rents for hotels and maybe better IT business and companies like Kingfisher, Jet

2. Construction sites empty and now restarting --- improvement in the realty market

3. People queuing up for loans at banks – or the branch manager smiling – better returns for banks

4. Price Hikes in petrol and diesel—will mean higher inflation and hence potential increases in RBI rates.

5. More no of new vehicles being added—better performance for the transport majors—if more commercial vehicles—then TATA Motors, Ashok Leyland,etc and if more individual—then better returns for Maruti, Hero Honda etc.

6. Work happening on infrastructure at a fast pace—good tidings for L&T, JP Associates, IVRCL etc.

7. Bad Monsoon—impact on FMCG companies: -ve on HUL, ITC, Godrej and  +ve for fertilizer companies

8. Salary Hikes/ increased attrition—things looking up for the companies ( read some of the recent comments on attrition in the IT sector)

9. Long lines at shopping malls--- great for retail companies-- Arvind mills, shopper stop , Vishal retail etc.

10. Reduced Direct taxes—will impact people’s take home positively and hence is great for white good manufacturers.

11. Naukri.com advertisement: Jobs are back !! :)


Simple enough?


These are great indicators of understanding what is the trend of the market and which companies are in the race for better performance.


what other areas can you think off which we can identify from our surroundings? Would appreciate any comments !


Best advice for fundamental investing is to keep your eyes and ears open.


Happy Investing!


(Don’t forget to subscribe to the posts using the link on the right and join the group of like minded people)