FDI and IPOs will be key drivers in 2004: Arun Kejriwal

The media sector has not been an out-performer in any way in 2003. While Zee Telefilms gained about 50 per cent, the out performer was clearly TV 18, which gained almost 150 per cent. Balaji Telefilms moved up by about 22 per cent and Mukta Arts is virtually flat.

The stake, which Reliance Mutual has taken in TV 18 is an interesting development and could mean more in the future. The TV Today IPO is another important development and this stock would bring glamour to the sector. Valuations of this stock would affect Zee in particular.

There hasn't been any direct FDI flow into the listed media but through secondary market purchases, the stakes have improved. However, not much is happening in the TV media as far as listed companies go.

The media sector, by and large, is expected to be in sync with the market. TV Today looks bullish. Zee could cover good grounds if CAS takes off, otherwise neutral. I am not too keen on Mukta Arts and Balaji Telefilms.

The key drivers for the media sector in the coming year will be foreign direct investments (FDI) and foreign tie ups, IPO from NDTV and possibly Star TV as well. The implementation of conditional access system, CAS, would also be an important trigger.

As far as investors are concerned, I would suggest they keep a stock specific focus - buy growth stocks and believe in divestment.

In 2004, the immediate target for the Sensex would be crossing 6150 points - the intra day high of 14 February 2000. If elections are held in September 2004, then the Sensex is likely to be in the 6750-7000 ranges. If held earlier in May 2004, then 6500-6700 would be more likely. Post elections if there is a stable government, the Sensex could see a further 500-point rally in six months.

Top sectors in 2004 will be pharmaceuticals and oil and gas. Also, FII inflows should continue - after investing over $ six billion in one year, they can't stop.

(Arun Kejriwal is an investment analyst and consultant. He may or may not have positions in the scrips he mentions).

Nerves of steel will deal with market volatility in 2004:
Parag Parikh

Media stocks have appreciated a lot thanks to the overall bullish conditions in the stock markets. The defining moment for the media sector as for the others, I believe, was the change of sentiment in the stock markets.

In 2004, the key driver for the media sector will be innovative ideas. In the coming year, trends for the media sector will be in line with the markets. Other than that, FII inflows will continue and the biotech sector and the pharma sector will see a lot of action.

I am quite bullish on the markets more because of an overall change of sentiment due to the improved performance of the economy, good monsoons, good liquidity in the markets. Also, restructuring by a number of corporate houses has resulted in improved performance.

As far as the small investor is concerned, one would require nerves of steel to deal with the volatility of the markets. They need to be very careful in making further commitments in the market but if one is invested one could hold on and ride the wave.

(Parag Parikh is Chairman, Parag Parikh Financial Advisory Services Ltd).

Back to New Year index page