India Re-Boom
By Ian Cooper
India Re-Boom
Dear American Capitalist Reader,
Months after a May-June 2006 market meltdown to 9,000, Bombay’s Sensex index recently nailed a new lifetime high above 13,000, surging past the 12,671.11 high of May 11, 2006. Once the rally sustains itself, we’re looking for heavy buy interest in small- and mid-cap names, especially those associated with e-commerce, but namely Rediff (REDF) and Sify (SIFY) for two other reasons.
First, India is expected to see a 160% jump in Internet users, according to TheInquirer.net, which will drive more traffic and revenue to Internet sites. And second, we believe REDF and SIFY are buyout candidates for Yahoo and Google, based on recent discussions.
Yahoo, for one, just inked an $8.6 million deal with Bharat Matrimoney, an Internet personals site (the Indian online matrimonial market is worth an estimated $200 million), and is reportedly “hungry for more acquisitions and tie-ups,” according to BusinessWeek.com. Yahoo is so hot for India that it’s already announced “plans to launch up to six new portals in regional languages, and acquire or enter into a partnership with an Indian company,” according to Business-Standard.com. In fact, a decision on a partnership or acquisition is expected over the next six to 10 months.
O ur Google assumption is based on an invitation for applications from people who can “identify and evaluate acquisition opportunities across existing and future market opportunities, drive management team decisions, lead deal execution, and help manage post-acquisition integration and performance evaluation in the South Asia region, ” according to RedHerring.com. That tells me Google’s on the hunt, too.
Have a great day.
Ian L. Cooper
Editor, EVS / Early Alert Trader