Trends To Watch In 2010

PSU divestment, US economic recovery, Goods & Service Tax and Direct Taxes Code will influence the market in 2010
T
he expectations of invesrors are now slowly gerring disintetested as
in 2009 were low and these the shorr-term teturns are not attrac-
were overshot by me market tive, and are sometimes even nega-
as we saw earlier. Now that 2010 is tive. All in all, 2010 will be a good
upon us, we must try and figure out year for PSU disinvestment which had
what could be the major economic sropped between 2004 and 2009, as
events this year. First, this budget is the then UPA government had ro rely
more likely ro be a rough exercise for on the Left parties' support ro survive
the finance minister (FM) as he has and the Left is very clear about the
ro balance the two sides of receipts government's control of industry. As
and expenditure. That aparr, the FM such, 2010 will be me year which will
will also have ro deal with the progress decide whether the central government
achieved in the various reforms that is actually pro-reform or not. We have
are being brought in such as the goods high hopes.
and service tax (CST), direct tax code The mird imporrant thing to watch
(DTC) and the proposed significant out for shall be the one which is on
changes in the Companies Act. While the rop of every invesror's mind. Will
the proposed dates for CST and DTC me Sensex cross 20,000 first? Actually,
implementation have been declared, as we have discussed earlier also, me
there is apprehension that the actual year-end predictions or expectations
implementation may be delayed by a regarding srock index movements are
year because of various reasons. made based on the current atmosphere,
All these have a great bearing on the and in any and every turnaround in
market movements roo. For example, market sentiment, the predictions are
there is a general feeling rhat the CST more likely ro miss the target. This year,
will lead ro lower costs across the me predictions are genetally on the
board. This, if true, can be a significant bullish side, and everyone is expecting
positive development, and if there is me global recovery ro pick up speed
a delay in its implementation, there during 2010.
could a negative impact on market There are a few question marks
sentiment. The same also applies ro the regarding this, and if there is some
direct tax code. The second imporrant unexpected happening somewhere, the
facror would be the proposed PSU dis- whole process could get derailed. As
investment that has been announced. we know, many economists are rais-
There is reason ro believe that now, ing questions abour the wisdom of
with the Communists out of the reck- preventing a depression through such
oning, the UPA government will speed heavy government spending by various
up the disinvestment process. Various leading countries. This is truer of the
PSUs are planning IPOs and FPOs in US than any other country, as it is by
the first half of 20 1 0, and the invesrors far the biggest economy.
- especially retail investors - are highly Till now, the handling of the econ-
charged up for the same. Here, timing omy by the Obama administration has
and pricing would b~ the key facrors. been good, and if the recovery g~ins
While timing can now be decided by speed, well and good. Bur, if the high
the companies depending on market unemployment rate does not come
sentiment, the pricing will have ro be down soon, or the demand growth
considered fully by the government. slows down, then mere could be seri-
Cood companies have priced their ous issues ro be tackled. And the mar-
IPOs very aggressively in the recent kets could tank in that case. Let us
months and in the process the retail hope mat such an event does not take
invesrors who invest for the shorr term place. Happy 2010. ~

SOMANI CEMENT COMPANY

Somani Cement (BSE Code 518071) with face value ofRs 10 has been ..a suspended from trading since June 2005. The last time its stock was

traded was on June 28, 2005 at the price of Rs 3.61. The SEBI has restrained the company and its promoters from accessing the securities' mar­ket for a period of ten years. This action was taken because the company's chairman had allegedly made several misleading announcements and created abnormal movements in the volume and prices of shares. They also have de­materialised shares in excess of the shares issued. For further information, you can contact the company's RTA. ~

GUJARAT HEAVY CHEMICALS

Gujarat Heavy Chemicals (GHCL) (BSE Code 500171) with face ..a value ofRs 10 is currently trading at Rs 52.75 with a 52 week high/low

of Rs 59.55/24.50. GHCL is a part of the Dalmia Group and oper­ates as a chemical and textile company. It is engaged in the manufacture and sale of soda ash, which is used for the production of detergents, soaps, glass, sodium salts and dyes. The company's textile business consists of the manu­facture of yarn, fabric and home textile products such as bed linen, curtains and cotton yarn. Its products comprise flat sheets, fitted sheets, pillowcases etc. The company's chemical division contributes about three-fourth of the total business whereas the rest of it is from textiles.
For the quarter ending September 2009, the company has posted a bad set of numbers in both topline and bottomline.

Its topline declined by 14 per cent on a y-o-y basis and was Rs 290.3 crore for Q2FYI0. Its bottomline was hit harder and declined by 23 per cent to Rs 20 crore as against Rs 26.1 crore posted last year for the same period. This was mainly because of an increase in the interest burden and depreciation by 2 per cent and 10 per cent respectively. The trailing 12-month earn­ing of the company discounts the current share price by 6 times which might look cheap but given the fact that the company has de-grown in the last two quarters continuously, we feel that the valuations are expensive.

Moreover, the company's promoters have been barred from dealing in securities for allegedly violating securities' market laws, including insider-trading rules. The SEBI has found the company guilty of filing false shareholding information of the promoters repeatedly over the four quarters of 2008. Therefore, our advice is to exit from the counter.

Hindustan Zinc (BSE Code 500188) with face value of Rs 10 is currently ••••• trading at Rs 1211.95 with a 52 week high/low of Rs 1249.75/303.20

Hindustan Zinc is a fully integrated zinc producer, with one of the best min­ing assets in the world. Its current mining capacity is 7,50,000 TPA ofMIC (metal in content), which it plans to ramp up gradually to 1 MTPA. Its smelter operations are situated at Chanderiya, Debrai and Visakhapamam. HZL has lead-zinc mines at Rajpura, Dariba, Rampura ete. Sterlite Industries has a 64.92 per cent stake in Hindustan Zinc, while the Government of India owns 29.54 per cent. Its captive mines and thermal power plants give the company a significant cost advantage, making it one of the lowest cost producers of zinc in the world.
For Q2FY10 the company's sales remained flat and were pegged at Rs 1,818 crore as against Rs 1,790 crore posted in Q2FY09. However, there was improvement in its EBIDTA margins which increased by 430 bps due to higher rupee realisa­tions on metals. The profit of the company for the same period declined by 2.6 per cent and was Rs 935 crore. The current market price discounts HZI..:s last 12-month earnings by 19 times and that seems fairly valued. Nevertheless, what makes the scrip attractive is its cash and cash equivalent of Rs 10,200 crore at the end of September 2009 which works out to Rs 240 per share. Therefore, we advise you to buy at every dip with a one-year time horizon ..

Portfolio Guide

Man Industries (BSE Code 513269) with face value of Rs 5 is currently trad­La ing at Rs 52.30 with a 52 week high/low ofRs 60.9121.5. Man Industries is a
part of the Man Group (UK), and opetates in the two segments of manufac­turing pipes and construction. The company produces and exports latge diameter carbon steel line pipes for various high pressure transmission applications for gas, crude oil, petrochemical products and potable water.
In Q2FY10 the company's sales declined by 17.6 per cent and were to the tune ofRs 310 crore as against Rs 376.5 crore posted last year for the same period. The profit figure for the company was hammered badly and was down by 71 per cent on a y-o-y basis. The company posted profit of Rs 3.1 crore against Rs 10.8 crore posted in Q2FY09. Going forward, we feel that the company's pipeline business is very much linked to growth in exploration and production (E&P) activities in the domestic and international markets, which in turn is being driven forward by strong crude oil prices.
At the end of August 2009, the order book of the company was at Rs 2,500 crore which is 1.3 times of its FY09 sales, thus providing good earning visibility. The company's foray into real estate is managed by its subsidiary, Man Infra, which is currently executing two commercial projects at Bandra and Vile Parle in Mumbai and a residential cum-commercial project at Neru!' The current share price of the company discounts its last 12-month earnings by 9.9 times. Looking the growth prospect of the company, which will take 12-18 months to unlock, we advise you to hold the scrip.

Lord Of The Rings

When the markets starr ro heat up or are not in a position ro provide a clear signal, it is almost always advisable ro find lesser-known coumers that are expected ro yield decem remrns. Based on this approach, we are recom­
mending herewim an auromobile ancillary company called I P Rings (IPRL). The compelling reasons starr from macro facrors like good sales growth in the auromobile secror, an impressive financial performance in HIFYI0, consistem dividend paymem hisrory and a norewormy oudook provided by the managemem.
Furmer, with global car makers targeting India as a small car hub, it can safely be assumed that IPRL will be one of the major beneficiaries. Also, the company has not pledged its shares and mis roo can be coumed as a positive e1emenr. On me valua­tion from, the coumer ay look expensive bur its strong performance in H2FYI0 is expected ro bring valuations ro bener levels. We recommend mat invesrors should buy the scrip at its currem levels with a rarget price of Rs 90 in the next one year.
A5 regards the business composition, the company manufactures produces such as pisron rings, differemial gears, pole wheels and omer orbital cold formed componems. Bur pisron rings form for a major comriburion ro the ropline with a share of more than 72 per cem. In FY09 me financial performance of the company got impacted in H2 on acCoum of global and domestic economic turmoil. Bur wim the Indian auromobile indusrry showing signs of growth, IPh has revived at a quick pace. This can be seen from the fact mat in HIFYI0 it posted a ropline ofRs 33.30 crore and botromline of Rs 2.71 crore as compared ro Rs 31 crore and Rs 2.13 core respectively in HIFY09.
Furmer, the company's performance in H2FYlO is expected ro be much berrer.

According ro the managemem, the order position appears ro be near normal and this cerrainly is a positive indicaror. The company is confidem mat wim me expected pick-up in me industry mere will be improvemem in capacity utilisation in both the divisions, leading ro better resulrs for the year 2009-10. Based on the amicipation of an improvemem in demand, a much higher production target has been set for me currem year, which the company is confidem will lead ro greater profitability.
A5 regards me other opporrunities, the managemem has stated that, "Since India cominues ro be the focus market for several auromorive players, both global and domestic, for setting up new vemures, this will bode well for me company. This is par­ticularly so in me passenger car segmem wherein India is strongly emerging as a global hub for the production of small cars". With its frontline position in the market, IPRL stands ro benefit a lor. Taking the evolving scenario imo consideration, me company is embarking on a strategy of innovation and has recently emered imo a new techni­cal aid agreemem wim Nippon Pisron Ring Japan for the manufacture of physical vapour deposition (ijVD) rings ro meet the new emission norms for the latest models of auromobile engines. A5 memioned earlier, it has been a consistem dividend paying company and announced a dividend in FY09 despite taking a hit in me bonomline. Now wim FYI0 expected ro be bener, me dividend paymem is expected ro increase. On the valuation from, its CMP of Rs 76 discoums its trailing four quarter earnings by 41x and its EV/EBITDA stands at 8x. But this is on accoum of poor performance in H2FY09. Wim H2FYI0 expected ro be better, me valuations are expected ro improve. Hence we recommend that invesrors should buy the scrip at its currem levels with a target price of Rs 90. ~ (The analyst does not hold any shares in the company)

Formula Of Consistency

onsistency is one thing which is highly rated everywhere and the stock market is no exception. Hence, companies displaying consistent perfor­mance always get a premium on the bourses. One such counter is BASF
India which has been a noteworthy performer in terms of stability ovet the last seven years with its topline and bottomline increasing steadily. But that is not the only reason for recommending BASF to our investors. The company also has been a regular payer of dividends, has pegged a good financial performance in the first half, plans to expand its capacity of engineering plastics, wants to sell off an unviable facility and last but not the least, is been driven by the remarkable improvement in the manufacturing sector. On the valuation front, its CMP of Rs 416 discounts its trailing four quarter earnings by 14.35x (EPS Rs 28.71) while its EV/EBITDA is at 7.82x. But these trailing four quarters includes the poor per­formance of H2FY09. With H2FY10 expected to be better, the valuations will no doubt improve. Along with all these factors, the company's MNC parentage and the merger of Ciba India with BASF are two other positives that will put sail in its winds. We recommend that investors should buy with a target price of Rs 490 in the next one year.

As regards the business of the company, it is mainly divided into four segments viz. performance and specialty chemicals, agro and nutrition products, plastics, and other chemicals. With the manufacturing activity in the country picking up gradually, this is what the management of BASF had to say in a recent interview:

"We are manufacturers for manufacturers, offering customised chemistry solutions. Our growth in India is dependent on the growth of the manufacturing industries. Since January 2009 there have been some positive signs in the India market. We are hopeful that demand will pick up in the coming months as the outlook for end-use industries is showing an improvement." As for its expansion plans, it is setting up a compounding 9,000 tonnes per annum engineering plastic plant at the Thane site with a capex of Rs 17.2 crore to be funded through internal accruals. The com­pany is now running product qualification trials and also exploring the possibility of de-bottlenecking of its facility at Mangalore for certain products. Further, the company has recently passed a resolution to sell its Dadra plant for Rs 5.15 crore and we feel it's a good decision. While this will help unlock the value from unviable projects, the cash so obtained would be invested in more profitable projects.
Its merger with Ciba India is also expected to be beneficial as the acquisition of Ciba's product portfolio and assets is a perfect strategic fit. The integration pro­cess is expected to be completed by April 2010. With MNC parentage there is an advantage of building up a strong new product portfolio. Further, it has already been made clear that BASF has identified India and China among their key focus geographies. As mentioned earlier, the company has been a consistent performer for the last seven years and it has carried this momentum to HI FYI 0 also. Here it posted a topline of Rs 752.54 crore and bortomline of Rs 75.07 crore as againsr Rs 697.81 crore and Rs 62.75 crore respectively for H1FY09. With the demand expected to rise in the second half the performance is expecred to be better in H2FY10. Considering all these factors, our recommendation is that investors should buy the scrip with a target price of Rs 490 in the next one year.

DSIJ Created Wealth For Readers

I am enjoying the cold weathet of wintet with my family during the Christmas holidays with lot of satisfaction that DSIJ research team did exemplary job in 2009 to live up to our readers' expectations. We guided our readers during every major event during 2009, something that we have been doing since last 23 years. When FCCB was turning into a major confidence crisis at the beginning of2009 and many pundits predicted that it was a bomb that is bound to explode in the face ofIndia Inc., we advised our investors to remain calm. We also predicted correctly that RBI would extend FCCB buyback facility to accommodate India Inc.
We also guided investors that the Indian banking stocks were the best bets for the investors, despite the whole banking world collapsing across the globe. We went ahead and recommended banking stocks that created huge wealth for the investors. We saw huge potential in making money in mid-cap stocks and went on to recommend 20 stocks that created huge wealth for the investors. There are many such instances when we created wealth for the investors.

When we look back at the year 2009, DSIJ research team created ample opportunities for the investors to create wealth. Our Choice Scrip, Low Price Scrip and Cover Story recommendations notched up more than 90 per cent success ratio. In other words, out of every 10 recommendations, as many as nine have performed as per our expectations. But the noteworthy feature has been the 'Book Profit' SMS, a unique concept in the history of Indian publishing industry that helped subscribers book profit from time to time.
But we must also congratulate SEBI, RBI, Department of Company Affairs (DCA) and the government who managed the economy pretty well during the confidence crisis. SEBI acted proactively to relax guidelines on rights issues, IPOs, MFs and buy-backs to ensure that market confidence remained buoyant. RBI managed the monetary policy well to spur growth. The DCA ensured that the collateral damage due to Satyam episode was limited. It also ensured that AS 11 was modified to help manage forex volatility, giving some breathing space. The government's stimulus packages ensured that India Inc continued to grow at over six per cent when most other countries across the world were witnessing degrowth. These well­coordinated efforts saw Indian economy and stock indices surging.

In short, in 2009 almost everything went perfect, and now with a stable government at the Centre, it's like icing on the cake.

All the abovementioned steps ensured that FIls kept pumping money into the Indian equity market. In 2009, FIls pumped over Rs 82,000 crore and this time our cover story looks at whether this inflow would continue in the year 2010.

Before signing off, the complete DSIJ team joins me in wishing our readers Very Happy and Prosperous 2010.

Conclusion

Cooperative Banking Sector in general and Urban Cooperative Banks in particular are going through a tough phase. In order to survive in the competitive
business environment there have to be sound plans for maintaining profitability by way of increasing volume of business and reducing the cost of business operations. Drastic changes are therefore required in the mind sets of decision makers in terms of bringing in modem practices of managing the business and use of Information and Communication
Technology to support such initiatives.
Systematic and careful implementation of Core Banking System could be seen as important step towards the same.
References
1. RBI, Nov 2007, Report on Trend and Progress of Banking in India, 2006-07, Reserve Bank Of India, Mumbai
2. RBI, Aug 2008, Report of Working Group on IT support for Urban Cooperative Banks
3. RBI, Aug 2008, Report Of The Working Group On Technology Upgradation Of Regional Rural Banks

Other benefits

Besides few important benefits explained above there could be several other benefits to the banks implementing CBS such as
1. Relief from Consolidation and reconciliation of data
2. Better and proactive management ofNPA
3. Better Risk Management by introducing ALM, AML type of application softwares
4. Better regulatory compliance for KYC, OSS type of systems Many more such benefits are there for the banks introducing CBS

Diversification of business

In order to maintain profitability of organisation and to survive in competitive business environment, traditional way of providing banking services is not going to be sufficient. Customer is keen on availing all the financial services required by him under single roof. Concept like banks as a financial super mall is really picking up. Many banks have started providing services such as Utility Bill Payments, Demat, Third party fund transfers, Payment of credit cards etc through Internet banking. Many banks have entered into MOU with Insurance companies to provide life
insurance services to their customers. In order to venture into such things banks today would require strong information platform and capability to share part of their data with outside agencies. Banks also need to have tie up with payment gateway service provides such as pay seal (JCICI) or HDFC.

Professional management and corporate governance

Organisation is said to be professionally managed when employees working at different levels are given specific responsibilities and also the necessary authority. Responsibility and authority should always go hand in hand. If managers are given necessary authority along with the responsibilities assigned, it can help them to take quick decisions. However, availability of information required by them to take quick decision plays important role. For any information to be good from point of view of decision making, it needs to fulfil certain criteria. Such information needs to be timely, accurate, reliable and valuable. Organisations have started thinking seriously about implementation of Core Banking System to ensure quick availability of decision making information whenever and wherever required.
While professional management practices help authorities to take quick decisions, it is equally important to bring transparency in decision making process. All the major public or private sector banks today have corporate governance
practices in place. Technology solutions such as centralised database implementation along with work flow automation tools are being used to bring more and more transparency and accountability in the system. Many banks have been using web technology for their mandatory disclosures and to display their financial performance for information of their members and
customers.

Advantages of Core Banking System implementation

Growth of the business

For any business to be successful, it is important to retain customers rather than getting new customers. This would be possible by providing innovative and customer friendly services. In the field of Banking and Finance Sector (BFS) many private sector, public sector banks and few cooperative banks which

are in CBS environment for quite some time have been leading in introducing new and innovative ways of banking. To name few, ihtroduction of ATM, new Cost control

Business entities across the world including BFS nave been struggling t~ keep cost of their

operations at minimum and as a part of such strategy they have introduced several cost control measures. Efforts while doing so, have been to keep human resources only at the minimum required level and get optimum output through greater use of Information and Communication Technology (lCT). Additional delivery channels mentioned above will not only ensure customer satisfaction but will also help to reduce cost of business operations. For example, Cost of transaction happening through ATM is approximately half the cost that bank would incur when customer carries out transaction in person at a branch. Whereas cost would be approximately 10 times less in case of internet banking to that of transaction carried out at branch by customer in person. This clearly highlights importance ofICT.

Options for introducing CBS

There could be three broad approaches for introducing CBS in DCBs.
First, the individual DCBs develop their own Data Centre (DC) and DatalDisaster Recovery Centre (DRC). A variant ofthis model could be the Application Service Provider (ASP) Model where the entire work is outsourced to an outside agency. Second, all UCBs
in every state brought under a common DC and DRC, owned and managed by a centralised agency. Third, DCBs share the DC and DRC of the other cooperative bank.

So far, the computerisation efforts in DCBs have largely remained bank-specific. It is rare to see that some uniform strategy is used for computerization of DCBs in different states. However, CBS being a cost intensive technology, decisions with respect to CBS implementation need to be taken with utmost care. It is usually seen that the decision
makers in cooperative banks are not much aware of developments taking place in the field of Information Technology and also about how to select a solution which is best in performance and at the same time cost effective. Moreover, most DCBs would not have the technical expertise available to take appropriate decisions in the matter. They would thus be exposed to the different vendors trying to push their products in the market. Further, DCBs lack the manpower skills that would be required for such technology management, particularly in the initial stages. Therefore, double care needs to be taken while opting for the first approach mentioned above.

A variant of the first approach mentioned above
was the case of an Application Service Provider (ASP) which would outsource the entire work for the DCB. It would provide the

DC/ DRC facilities and take care of the operations for a price. However, it would bring in dependency on external vendor and IT assets property will remain with the ASP. It would therefore be a great option if a group of DCBs come together and set-up a common data centre by way of sharing the cost incurred. This would ensure that the property remains with the member banks and whatever expertise required for managing operations of Data Centre are also shared.

What is Core Banking Solution?

The platform where information and communication technology are merged to suit core needs of banking may be referred to as CBS. In CBS, computer software performs the core operations of banking like handling and recording of transactions, maintenance of passbooks, interest calculations on deposits and loans, maintaining customer records and generating reports and statements. The software is installed at bank branches and then interconnected by means of telephone line, internet and satellite communication. It allows customers to transact with the bank from any branch if it has installed CBS. This new platform has changed the way of working of banks.
In an ideal CBS scenario, all products, processes, channels and customer relationship management tools are integrated and administered via a central database of the bank with branches and channels as delivery points. This enables data integration for various purposes including regulatory reporting and internal MIS all at considerably lower cost. The new generation private sector banks were the first to adopt CBS technologies in India followed by a few public sector banks. Gradually, the same were adopted by most of the commercial banks as part of their computerisation processes and also by selected DCBs

Urban Cooperative Banks in India

Urban Co-operative Banks are important part of the financial

system in India. Sector has witnessed phenomenal growth during the last one and half decades. It was mainly due to liberalization and globalization policy of government of India which encouraged setting-up of new urban cooperative banks. Further, the deregulation of interest rates, as available to the commercial banks, enabled the UCBs to mobilize huge amount of deposits. While all these positive developments taking place on one hand it was found that there are certain infirmities in the sector that have manifested in the form of weakness of some of the entities resulting in erosion of public confidence and causing concern to the regulators as also to the sector at large. Reserve Bank Of India (RBI) being a regulatory agency, in order to mitigate the risks to which individual banks and system are exposed has been providing guidelines such as Assets and Liability Management, norms for provisioning ofNPAs, KYC, Anti Money Laundering etc. Due to fact that use ofIT is at very infancy stage except select cooperative banks majority of the Cooperative banks are facing difficulties in complying with regulatory guidelines on one hand and on other hand with respect to exercising sound control on business operations as information required for the purpose of decision making is not readily available. Recent changes in policy of Government of India such as application of income tax to cooperative banks has added to the existing problems of cooperative banks. Important challenges being faced by Urban cooperative banks at present are Competition, increasing customer expectations, pressures on reducing cost of business operations, lack of timely decision making information. Implementation of Core Banking Solution (CBS) is being considered as strategy to face these challenges.

Significance of CBSimplementation for UCBs

Urban Cooperative Banking (UCBs) Sector is going through a most difficult phase at present. It is high time that authorities concerned with Urban Cooperative Banking sector realise that only fittest will survive. They also need to see that

aspirations of their Sector are nurtured in a manner so that the interest of Members, Customers and Public at large is protected. At the same time, it is equally important to comply with requirements of regulatory agencies which are trying to put in place systems and mechanisms that would enable UCBs to perform their banking functions in the interest of public. This could only be possible by radical transformations in a way UCBs are functioning today and most importantly adopting Information and Communication technology on a larger scale.

Co-operative Bank in India through a Technology Crystal Ball

The operative banks with a history of almost 100 years have become an important constituent ofthe Indian Financial System. This is attributed mainly to their much better local reach, personal interaction with customers, and their ability to catch the nerve of the local clientele. With this backdrop, one can envision the tremendous potential which lies ahead for them. However, the realisation of this potential depends on how they gear themselves to meet the challenges of modem banking, mainly driven by technology.
Technological innovations such as Core Banking Solution (CBS), Image Enabled Cheque Processing and payment have been the cornerstone of new age

banks worldwide. For Co-operative banks, these initiatives must become the benchmark to satiate the demands of the present consumer as well as underline their presence in the competitive banking landscape.
Present day customer wants quick fund transfer, deposits/ withdrawals, account updates, transaction postings etc. and have no time to wait in queue. Co-operative banks can answer customers' demands effectively and efficiently by implementing CBS. The 'Anywhere Banking', 'Anytime Banking' through new, 24 X 7 X 365 delivery channels such as Automated Teller Machines (ATMs), Internet, and
Mobile banking, etc., are some of the benefits of core banking. Additionally, the Management Information System (MIS) reports, which is a feature in all core banking solutions, helps the top management as an effective risk management and a strategic decision making tool.

A centralised Data
Center, secured information exchange, role defined access, robust authentication
process back up site
(Disaster recovery) is
the real core running in the background which makes bank to service, and customers to avail banking
at a mouse click.

Bank Introduction

The last month of the year has passed off smoothly with most of the markets ending on positive notes. The equity market was stable with the SENSEX hovering around 10000 levels, Gilts market with very high trading volume due to drastic fall in sovereign rates, currency market reaching stability at about Rs.48 per Dollar, commodities market showing fall in price leading to fall in inflation level and positive reaction to the stimulus package announced by the Government and RBI. However, there is a consensus that the past event have taken a lot out of the economy and the days of 9% growth are not likely to be seen in 2009. As per the recent data release, imports and exports have slowed down significantly which is going to have a negative impact on the market. The fall in oil prices is the saving grace for the economy.
CCIL business attained a new milestone with outright gilts settlement volume reaching an all time high of daily average of Rs.17,491crores surpassing the last month's daily average of Rs.l0,674 crores. Repo transactions also achieyed an all time record of daily settlement average of Rs.16,943 crores vis-a.-vis Rs.15,191crores in Dec'08. CBLO achieved a robust growth with a daily average of Rs.32,261crore, while forex segment
recorded a marginal fall in average daily volume with Rs.70,658 crores. The 10-year benchmark witnessed continuous fall resulting in higher market activity. The reduction in CRR/SLR as well as policy rates like Repo/Reverse Repo rates also helped the market positively.
Going forward, we plan to publish "Rakshitra II electronically so that it can be widely circulated through mail as well as through free downloads from our website. The new CCIL portal which is going to be launched shortly will have more flexibility to add more content to the existing website. The new "CCIL Certification Programme" is going to help market participants to refresh their knowledge and skill set. I expect all staff members to actively take part in the certification to make it a success. There is a general feeling that 2009 will be better than 2008. Let us hope so as with so much potential the Indian economy is being held back on account of sentiment. Wishing all readers a very Happy and Prosperous New Year