| KNR Constructions, yet another small construction company aiming to benefit from the vast opportunities in the construction sector and also to scale up its business, intends to raise Rs 133-141 crore through its initial public offer of 78.74 lakh shares at a price band of Rs 170-180 per share. |
| KNR, which is mainly into construction of roads and having recently diversified into the irrigation & water supply and urban infrastructure, generates about 70 per cent of revenue from southern India. The boom in road construction has helped the company grow its revenue and net profits over the last few years. KNR's turnover has increased from Rs 182 crore in FY 03 to Rs 324 crore in FY07 (CAGR of 15.5 per cent), while its net profit during the same period has grown from Rs 7.11 crore to Rs 20.40 crore (CAGR of 30 per cent). |
| While growth has been reasonable, it will improve substantially due to a robust order book and better industry outlook. Its order book expanded from Rs 200 crore in FY05 to Rs 1,734 crore (as on November 30, 2008)-- over five times its 2007 revenue, thus providing strong revenue and earning visibility. |
| Besides, as a part of growth strategy and to support its growing business needs, the company proposes to invest Rs 21.48 crore towards capital equipment followed by Rs 25.20 crore for increasing working capital and Rs 78.34 crore as investment in the build own and transfer (BOT) projects. |
| The company currently has two BOT road projects worth over Rs 1,040 crore in joint venture with Patel Engineering. KNR, which owns a 40 per cent stake in each of these JVs, will benefit by way of executing the construction work of worth Rs 800 crore besides, an annuity income once the project is completed after two years. The JV is expected to receive a gross annuity of Rs 154 crore per year, after which operating expenses and interest costs will be deducted. |
| Additionally, post this IPO, KNR's networth would rise from Rs 70.20 crore as on September 2007, to Rs 195 crore. This increase will help company improve its debt:equity at 0.95 times as compared to current ratio of 2.6 times. A higher networth will also help the company in qualifying for larger projects independently and thus, scale up its business going forward. |
| At the offer price of Rs 170-180, it is priced at 24-25 times its FY07 earnings and 18-19 times its FY08 annualised earnings . The valuations are reasonable considering the peer group companies like Pratibha Industries, Gayatri Projects and Tantia Construction, which trade between 20-25 times FY07 earnings. For H1FY08, KNR reported a net profit of Rs 12.8 crore. |
| This is expected to be higher at around Rs 19 crore in the second half, as typically, the first half numbers are lower due to monsoon. For the full year, the fully diluted EPS is expected around Rs 10, translating to a PE of 17-18 times. To sum up, a strong order book of over five times its FY07 revenue and to be executed in about 24 months translates in revenue and earnings growth of over 50 per cent over the next two years and thus support valuations. |
| Issue Opened: January 24, 2008 Issue closes: January 29, 2008 |
India Equity Analysis, Reports, Recommendations, Stock Tips and more!
Search Now
Recommendations
Monday, January 28, 2008
KNR Constructions - valuations reasonable
IRB Infrastructure Developers - good for longterm
| The restructuring exercise initiated by the IRB group in 2005 has resulted in the formation of a holding company, IRB Infrastructure Developers in the year 2007. While it was formed with the intend to undertake leasing activities, post restructuring, the company is now emerging as a large player in the construction space---including, construction of roads and highways and also operating toll-based infrastructure (highways). |
| Going forward, the company is expected to benefit from its large portfolio of build-operate-transfer (BOT) road projects. Some of these projects are expected to go on stream over the next two years, which in turn should lead to substantial increase in revenues. |
| That apart, a strong order book for the construction business, to the tune of Rs 2,325 crore (almost seven times its FY07 revenue), will act as fuel to the fire. Also, the company's plan to repay a substantial part of its debt will add to the earnings in the short term. While for the long-term, its real estate plans will keep earnings momentum to continue. Road to growth |
| Similar to other infrastructure companies, IRB Infrastructure Developers undertakes government contracts for the construction of roads and highways. The company undertakes BOT road projects in which it does the construction work as well as shares the revenue coming by way of toll collections. The company is currently involved in 12 BOT projects in the roads and highways sector, including the prestigious Mumbai-Pune express highway. |
| Out of these projects, about eleven of them are operational and generate revenue in the form of toll and maintenance. During FY07, the company earned about Rs 300 crore of revenue from collection of toll and another Rs 25 crore from maintenance work undertaken at existing projects. However, the same will go up further over the next two years, on account of commissioning of Surat-Bharuch highway (65 km) and the expected Surat-Dahisar 239 Km project, where the company has emerged as the highest bidder. |
| These two projects, based on estimates viz. traffic and revenue per Km would remain same as in the case Mumbai-Pune highway (Rs 31,500 per Km per day), can provide an annual annuity income of Rs 344 crore. However, it is believed that comparatively, the traffic on these routes would be higher due to the fact that they facilitate transportation of goods from the ports to the Western and North India. In an optimistic case viz. revenues of Rs 45,000 per Km per day, the estimates suggest that revenues over a 12 month period could reach over Rs 500 crore, as compared to the revenue of Rs 300 crore reported in FY07 |
| Huge construction |
| Apart from toll revenue that the two new projects will bring in, they will also contribute to the construction and maintenance business, since IRB itself would be undertaking the construction of these projects. Notably, the company also has an order book of Rs 2,325 crore (including Rs 1,400 crore order for Surat-Bharuch toll project). Of these, construction work equivalent to Rs 1,200 crore has to be completed over the next two years besides, maintenance work worth Rs 1,100 crore will accrue over the next 10-12 years. |
| Add to this, the potential construction order of the Dahisar-Surat project (yet to be awarded to the company), which is estimated at Rs 2,400 crore, the order book for the construction business alone would reach to Rs 3,600 crore, which is to be executed over the next 30 months. At the same time, the order book of maintenance will reach to Rs 2,300 crore, spread over the next 10-12 years or an average of Rs 190 crore per year. |
| Besides these triggers in the near future, the company, as a part of its long term strategy, proposes to enter the real estate business. The company is in the process of acquiring land and, so far, has acquired 925 acre out of the planned 1,400 acre in and around Pune (in the vicinity of its Mumbai-Pune express highway). On this land, the company intends to develop a township, over the next ten years. The first lot of the saleable area is expected to come in FY10-11. On a conservative basis, if the saleable area is priced at Rs 2,000 per square feet, the total value of the project works out to over Rs 6,000 crore or per share value of Rs 30 per share, as shown in the table. |
| Investment rationale |
| The company is operating in high growth areas, where there demand continues to remain high. Besides, company enjoys superior margins, thanks to a higher share of revenues from the toll business. Also, its own the capital equipment and undertakes engineering and construction work in house. Further, out of the total debt of Rs 2,240 crore, the company aims to repay debt to the tune of Rs 723 crore. But, how The repayment of the debt will further result into the post-tax savings of about Rs 48-50 crore and hence, will add to earnings (about Rs 1.5 per share) in the FY09. But thereafter, as the company undertakes other projects, the debt levels could rise again. |
| The current order book of Rs 3,600 crore works out to over 11 times its FY07 revenue. Considering these projects are executed over the next 30 months, the same suggest that revenue and earnings growth can be sustained. All these augurs well for the company. Investors can apply with a long-term perspective. |
| Issue opened: January 31, 2008 Issue closes: February 5, 2008 |
Onmobile Global - expensive issue
| The Indian wireless telecommunications market aptly reflects the macroeconomic growth as well as the dramatic demographic shift that the country has witnessed over the past decade. The number of wireless subscribers in India has grown from a meagre 13 million in March 2003 to 221 million in November 2007. |
| Even then, telecom penetration in India is lower than international standards, in spite of growing from 12.7 per cent in 2006 to 20 per cent in November 2007. Telecom penetration in India is likely to grow to 38.6 per cent in 2011, according to Gartner’s Forecast: Mobile Connections, Asia/Pacific, 2002-2011. Gartner estimates the number of cellular connections in India to surpass 400 million by 2011. The opportunity is humongous, and there are plenty a taker. |
| Apart from cellular operators, there are companies that provide telecom equipment, tower companies and those providing support services to run the cellular networks. |
| Talking business |
| Fitting in the latter category is OnMobile Global, a telecom value added services (VAS) and software provider to cellular operators, internet as well as media industries. OnMobile functions as a content aggregator, provides software application services and delivery platforms for various value-added services that telecom operators globally offer to their users. |
| Examples of its services include providing ringback tones, voicemails and missed call alerts, voice–based short messaging services, interactive information and entertainment solutions on mobile phones such as alerts and updates, and mobile commerce solutions like mobile ticketing and bill payments. “OnMobile’s services are white-labelled under the telecom operators’ brands, which helps us achieve economies of scale by having all the leading operators on our client list,” claims Arvind Rao, chief executive officer, OnMobile Global. |
| Being one of the very few VAS players in India, OnMobile claims to command a whopping 95 per cent of this market. Telecom operators too, are shifting focus from traditional services to offering value added services, in order to tackle gradually falling average revenue per user (ARPU) in the wake of pressure on tariffs. Since the share of VAS revenues in a telecom operators’ pie, which is roughly 10 per cent, is likely to rise going forward. |
| Stepping on |
| From being an Infosys incubated startup in 2000, to growing into a Rs 100 crore plus global VAS content aggregator in 2007 with two acquisitions, OnMobile has had an impressive trajectory. It is now proposing an initial public offering (IPO) in the range of Rs 463.30-490.50 crore by issuing fresh shares amounting to 19 per cent of its fully diluted post-offer equity capital. |
| This translates into a post-offer market capitalisation of Rs 2,440-2,583 crore. The price band for the issue is fixed between Rs 425-450 a share. From the issue proceeds, OnMobile plans to deploy Rs 180.50 crore to purchase equipment, while the rest will be used to repay loans. |
| Growth trail |
| Since its VAS solutions are telecom technology agnostic, OnMobile can have clients in all arenas including telecom players from GSM, CDMA and wired-line as well as media and internet companies for its voice, text and GPRS-based service offerings. OnMobile receives a share of its client companies’ revenues for the services it provides to the telecom operators’ users. |
| Its clientele includes all the leading telecom operators in India, and a few from Australia, Bangladesh, Indonesia and Malaysia. “Once implemented, our solutions and equipment become an integrated part of telecom operators’ networks, which makes it difficult for the operator to change vendors,” claims Sandhya Gupta, head, M&A, investments and strategy, OnMobile. |
| OnMobile has grown its top line at a 100 per cent compound annual growth rate (CAGR) over FY04-FY07, and delivered operating margins in excess of 45 per cent, and net margins of over 20 per cent. “Since our investment in developing the technology which is deployed at different clients is fixed in nature, every incremental rupee added to the top line brings about a more than proportionate increase in our bottom line,” says Rajesh Moorti, chief financial officer, OnMobile. OnMobile has carried out two acquisitions so far – Mumbai-based Itfinity in December 2006, and Voxmobili in France, in September 2007. |
| Valuation |
| The OnMobile issue is priced at 33 and 35 times estimated FY09 earnings at lower and upper end of the price band, respectively. Although there is no similar listed player operating at OnMobile’s scale in India to compare it with, Tanla Solutions operates as a content aggregator in developed telecom markets like the UK and Singapore. Tanla Solutions trades at less than 13 times estimated FY09 earnings. |
| Going by this, OnMobile’s issue appears expensive. The risks too, are not few. So far, telecom companies’ VAS revenues account for less than ten per cent of their top line. Even though the entry barriers to this segment may appear high at present, telecom companies are likely to be pleased with new entrants once VAS revenues account for a higher share in their revenues. |
| Risks of execution in terms of OnMobile’s ability to continually innovate newer products in order to bring in higher number of VAS users too, becomes significant from a long term perspective. Investors with high risk appetite, who are willing to offer a scarcity premium to the company may subscribe to the issue. All others should wait and watch. |
| Issue opened: January 24, 2008 Issue closes: January 29, 2008 |
Crude ends marginally higher
Price dips to $85 but then recovers in the later part of the week on Bush’s stimulus package
Crude prices ended marginally higher for the week ended on Friday, 25 January, 2008. Prices ended higher just by 80 cents. Price fell initially earlier in the week after Federal Reserve slashed benchmark interest rates by 75 basis points to 3.5%. Price fell as traders could not get out of the recessionary fears and thought that demand for oil would lessen in the coming months.
For the week ending Friday, 25 January, 2008 crude-oil futures for light sweet crude for February delivery closed at $90.71/barrel (higher by $0.80/barrel or 0.9%) on the New York Mercantile Exchange for the week.
Prices hit almost $85/barrel initially after Federal Reserve’s sudden surprise. But then in the final couple of days of the week, price recovered after the Bush Administration announced a stimulus package to ward off recession. Prices rose despite Energy Department announcing a rise in crude inventories for week ended 18 January, 2008.
As per the weekly inventory report by the Energy Department this week, U.S. crude inventories, rose for a second week, increased to 289.4 million barrels in the week ended 18 January. Crude inventories at Cushing, Oklahoma, the delivery point for Nymex-traded crude, fell by 800,000 barrels to stand at 15.7 million barrels. Total commercial petroleum inventories, including crude, motor gasoline, heating oil, increased by 2.2 million to 972.3 million barrels last week, and were in the middle of the average range for this time of year.
Crude had ended FY 2007 substantially higher by $35 or 57%. It was crude’s biggest yearly gain in five years.
Gold hits new high
Production halt at South Africa and lower borrowing cost boost bullion metal price
Precious metal prices soared on Friday, 25 January, 2008 today as lower borrowing costs increased the appeal of the precious metal as a hedge against inflation. Price also rose after severe power shortages forced major mining companies to shut down their operations in South Africa, the world's second-largest gold producer and biggest platinum producer. Silver prices also gained today.
Gold generally moves in the opposite direction of the U.S. currency. Gold, as a dollar-denominated commodity, suffers from dollar strength.
Comex Gold for February delivery rose $4.9 (0.5%) to close at $910.7 an ounce on the New York Mercantile Exchange. Earlier in the day, it hit an intraday price of $924.3 an ounce. Prior to Friday, gold prices had reached a record $916.10 on 15 January. For the week, gold prices gained 3.3%. This year, prices have gained 9% till date.
Comex Silver futures for March delivery rose 15.7 cents (1%) to $16.49 an ounce. Silver has gained 11% in 2008. The metal had climbed 16% in FY 2007. The metal also has gained for seven straight years.
Gold has traditionally been used as a safe-haven asset against rising inflation. Investor sentiments are boosted by the fact that gold and silver are alternate sources of good investment in the face of declining dollar and rising energy prices. Rising crude increases inflationary pressures and vice versa. On the other hand strong dollar reduces the appeal of the metal as alternate source of investment.
Gold witnessed the greatest annual gain in twenty eight years by gaining $200/ounce (31%) in FY 2007. In 2006, silver had jumped 46% while gold gained 23%.
In the currency markets on Friday, the dollar was mostly higher against major counterparts, holding the bulk of its gains on the euro, yen and Swiss franc after U.S. stocks turned lower, but slipping against the British pound sterling on expectations of a further cut to U.S. interest rates next week.
In the energy market on Friday, crude oil rose for a second day on speculation that the U.S., the world's largest energy consuming country, may avoid recession after the announcement of an economic stimulus package. Crude oil for March delivery rose $1.30 (1.5%) to settle at $90.71 a barrel.
Earlier this week, Federal Reserve slashed its benchmark interest rate 0.75% to 3.5% after global equity markets tumbled on concern the slumping U.S. economy will drag down the growth rates of other nations. Federal Reserve’s decision came as a surprise to everyone but Fed took the same as stocks markets worldwide, had been plunging on fear that US economy would be hitting a recession soon.
Gold had climbed 31% in FY 2007 as lower interest rates had sent the dollar tumbling, and crude-oil prices rose to a record. The Fed reduced federal funds rate three times in FY 2007.
At the MCX, gold prices for February delivery closed higher by Rs 48 (0.42%) at Rs 11,532 per 10 grams. Prices rose to a high of Rs 11,654 per 10 grams and fell to a low of Rs 11,491 per 10 grams during the day’s trading.
At the MCX, silver prices for March delivery closed Rs 131 (0.62%) higher at Rs 21,148/Kg. Prices opened at Rs 21,070/kg and rose to a high of Rs 21,320/Kg during the day’s trading.
Bharti Airtel, Indiabulls, Bank of India, HDFC Bank
Bharti Airtel
Research: HSBC
Rating: Buy
CMP: Rs 915
Bharti Airtel is one of HSBC’s preferred picks in the telecom sector because it believes the stock offers low risk exposure to the domestic wireless sector at attractive valuations. Bharti Airtel, with low operating and financial leverage, offers the best earnings visibility vis-à-vis other domestic telecom companies and trades at FY09E P/E of 18.6x.
The current estimates for Bharti Airtel factor in the potential combination of high subscriber growth, low subscriber quality and high capital expenditure (capex). Unlike its peers, for whom EBITDA is likely to be subdued given the new rollouts, Bharti Airtel will continue to benefit from scale through its rising subscriber base.
The creation of Indus (tower JV) is a significant catalyst as it allows Bharti Airtel to benefit from lower capex and deeper coverage, while offsetting spectrum constraints and monetising its tower assets. HSBC remains bullish on Bharti Airtel’s earnings outlook and forecasts a 25.3% compound annual growth rate (CAGR) in earnings per share (EPS) for FY08-10E. This view is based on robust subscriber growth, recent initiatives to stimulate usage and stable EBITDA margins.
Indiabulls Fin Services
Research: Motilal Oswal
Rating: Buy
CMP: Rs 779
Motial Oswal reiterates its ‘buy’ rating on Indiabulls Financial Services with a revised target price of Rs 1,086. In its first quarter post-demerger, Indiabulls reported 270% y-o-y and 57% q-o-q growth in loan book to Rs 8,800 crore in Q3 FY08. Disbursements, at Rs 3,300 crore, were the highest ever in any quarter. Though yields declined to 21% due to an increase in secured loans, earnings grew 80% y-o-y. Post the impressive Q3 FY08 numbers, Motilal Oswal is raising its estimates on disbursements and loan book for FY09 and FY10. Indiabulls may disburse loans worth Rs 10,500 crore in FY08, which will increase to Rs 26,000 crore in FY10.
This will result in 143% CAGR in loan book over FY07-10E. But by factoring in lower yields, Motilal Oswal expects the strong growth in loan book and higher fees from processing and insurance distribution to drive earnings growth. Operating efficiencies will also support earnings, which are expected to see CAGR of 81% over FY07-10E.
The company has applied for a licence for its life insurance business, which is likely to be launched in Q1 FY09. Despite being a late entrant in this segment, its large customer base and wide distribution network will ensure fast growth. Motilal Oswal values Indiabulls at 3x FY10E book value (17x P/E) and the insurance venture at Rs 100 per share (at 49% stake).
Bank of India
Research: Morgan Stanley
Rating: Overweight
CMP: Rs 395
Morgan Stanley reiterates ‘overweight’ rating on Bank of India (BoI) with a target price of Rs 525. BoI reported Q3 FY08 earnings of Rs 510 crore, up 101% y-o-y and 20% on a sequential basis — higher than the expectation of 69% y-o-y growth. The bank’s core operating profit grew 74% y-o-y on sequential improvement in margins, robust fee income growth and control on operating expenses. In fact, the bank overprovided costs during the quarter — it has proactively provided for wage arrears for FY08 on an estimated basis. Asset quality strength persisted, with BoI’s coverage ratio improving to 78% in Q3. Productivity is improving across all areas — the bank opened 101 branches last year, without adding a single employee. Core earnings were strong. BoI’s continuation of strong core earnings momentum is also impressive. This is the sixth consecutive quarter the bank has reported earnings growth of over 50% y-o-y. Even core earnings growth has averaged 40% y-o-y during this period. The stock is trading at 10x FY09E earnings, 2x book with an RoE of 21%, which is very attractive.
HDFC Bank
Research: Edelweiss
Rating: Buy
CMP: Rs 1,601
Edelweiss maintains ‘buy’ rating on HDFC Bank. The bank’s Q3 FY08 profit was up 45% y-o-y, ahead of consensus estimates. Net interest income (NII) grew 55% y-o-y to Rs 1,430 crore. The bank’s business momentum increased on strong contribution from SME and corporate segments. Provisions rose q-o-q with higher specific provisioning. The bank booked one-off gains of Rs 100 crore on sale of its stake in CAMS during the quarter. It also made one-off provisions on indirect taxes of Rs 73 crore. Adjusting for these extraordinary incomes, net profit grew 36% y-o-y. Pre-provisioning operating profit grew 30% y-o-y to Rs 930 crore. Key highlights of the quarter were: (1) Net interest margins improved q-o-q to 4.3%, with decline in cost of funds and increase in yields on investment; (2) Core fee income grew 38% y-o-y; (3) The proportion of low-cost deposit declined slightly to 51%; (4) Operating expenses increased 78% y-o-y due to higher other operating expenses; (5) Overall provisioning increased 59%; and (6) Balance sheet grew 47% y-o-y. Edelweiss is revising its earnings estimates upwards for FY08E and FY09E by 2% and 6%, respectively, and expects the bank to post EPS of Rs 45 for FY08E and Rs 59.6 for FY09E, respectively. The stock is trading at 3.6x FY09E book and 24x FY09 earnings.
Sunday, January 27, 2008
RBI meet, IPO refunds may decide the market course
Stock market will pin its hopes next week on two central banks -- India`s RBI and Federal Reserve of the US -- in its bid to recoup close to Rs 10,00,000 crore lost in the recent turmoil on the bourses.
In addition, the market would also look forward to refunds from two major initial public offers, one by Kishore Biyani-led Future Capital and another from Anil Ambani Group`s Reliance Power.
The two public issues had seen demand worth over Rs 8,00,000 crore collectively, a large portion of which was diverted from the secondary market.
While post-allotment future capital shares, close to Rs 16,000 crore is estimated to find its way to the secondary market, the allotment of shares in Reliance Power IPO would release more than Rs 1,00,000 crore.
The refunds for unalloted shares of Future Capital, to list on February 1, would start on January 29, while that for Reliance Power would follow soon after.
The refunds to qualified institutional investors alone are estimated at about Rs 40,000 crore in Reliance Power IPO.
But, all the eyes in the market would be on the monetary policy review by Reserve Bank of India on January 29 for future direction to the Indian bourses. The possibility of a 25 basis points Repo rate cut by the central bank has increased, especially after a sharp cut in the US rates.
After cutting the rate by 75 basis points in an emergency meeting last week, Fed`s rate-setting committee is holding its scheduled meeting on January 30, where it could provide further insights on the future outlook.
Art investment picking up
India’s economic boom has fuelled demand for condos, cars and company stocks but some of the new wealth created in Asia’s third-biggest economy is finding its way into art.
Entrepreneurs and young professionals, the biggest beneficiaries of India’s financial prosperity, are buying works of art both to signal they have arrived in life and as a safe-haven investment, auctioneers and gallery owners say.
The trend was on show last week at a Bangalore sale to snap up works by modern Indian artists such as Maqbool Fida Husain, Jamini Roy, Vasudeo Gaitonde and FN Souza.
“The interest in art is part of the lifestyle change we are witnessing,” said Maher Dadha, 54, chairman of Bid and Hammer Auctioneers, who estimated the minimum value of the combined collection at Rs100 million.
“Wealth has percolated down and people are buying art just like they are buying penthouses,” he said.
The hammer went down on a 1971 Husain watercolour on paper, entitled Shiva, at Rs3.4 million, the top price paid at the auction. At the start of this decade, Husain’s works fetched less than Rs600,000.
Auctions of modern and contemporary Indian art have raised millions of dollars overseas in recent years, with Christie’s selling a Tyeb Mehta painting for $1.6 million in 2005.
“Now it’s an internal trend, where Indian art is getting recognition in India itself,” said Dadha, adding that India’s rich “don’t blink for a moment over cost.”
Economic growth running at an annual 9%, a stock market that rose a record 47% last year and surging salaries for finance and technology professionals have created a middle class clientele for art.
Collecting Indian art has been traditionally a pursuit of former maharajahs, industrial houses, overseas collectors and rich expatriates.
The local art market -- both gallery sales and auctions -- is worth between $400 and 450 million and expanding as prices jump, said Arun Vadehra, owner of Vadehra Art Gallery in New Delhi and a consultant to Christie’s.
Gallery sales have jumped from barely $2 million in 2000 to $150 million, said Vadehra.
“The art market is very hot,” said prominent Indian art critic Ella Datta. “The collector base is growing with lots of of people like doctors, lawyers and IT professionals who can afford art coming into the market,” she said.
According to Bid and Hammer, the most renowned Indian art currently delivers solid annual returns of 35%. “Eight years ago, I bought a Jaya Jhaveri for a small throwaway price and today it is worth at least Rs100,000,” said Bangalore entrepreneur Sudhir Udayakanth, 34. “Today art has become an investment,” he said.
In 2006, auction house Osian’s raised Rs1.02 billion for a fund dedicated to art, luring investors with the promise of converting the country’s cultural wealth into capital assets.
The fund was open to those capable of depositing at least Rs1 million for three years. Osian’s paid a dividend last year, becoming the world’s first art fund to share income with investors before the lock-in period ends.
Indians also have access to purchasing art online, with Internet auction sites such as Saffronart opening up. The online market is worth between $30 and 40 million a year, said Dinesh Vazirani, a co-founder of Mumbai-based Saffronart.
Via Mint
Subscribe to:
Posts (Atom)