Multibaggers for future

After the failed attempts to contain inflation even by restricting money supply, RBI is coming round to the view that foreign funds into real estate are creating an asset bubble. To avoid a hard landing as seen in US economy, RBI proposes curbs on foreign venture capital investments (FVCIs) funds. The central bank notes that this route has opened a parallel channel of investment thus opening a regulatory arbitrage window. Majority of such funds have their base in tax havens like Cayman Islands, Mauritius and Cyprus . FVCIs enjoy significant benefits which are not available to domestic VCs including full tax exemptions and minimum capital base of INR50m. Besides, FVCIs enjoys full exemption from entry and exit pricing norms which are applicable to foreign investors in form of FDI, exemption from one year lock in period for sale after IPO. All these exemptions prompted foreign funds and Indian firms to set up companies abroad (usually in tax havens), raise funds at cheaper rates and t

India based Sintex Industries Ltd has acquired a German auto component supplier. It has acquired a 90% stake in Geiger Technik GmBH for US$50m (€35.6m) . The acquisition has been done through its wholly owned Netherlands-based subsidiary Sintex Holding BV. Remaining 10% will be held by the Geiger family. Geiger produces precision plastic parts including tanks and reservoirs, piping, air ducts, cooling and fuel tank components. The company has four manufacturing plants including three in Germany and one in Poland . Geiger has a clientele including BMW, Daimler, Volkswagen, Siemens etc and its sales in 2008 are expected to be around US$165.7m (€118m). With this acquisition, Sintex has expanded its manufacturing operations in Germany which is the largest automotive market in Europe. The acquisition will assist the company to further enhance its presence in the European market. Sintex has made a number of acquisitions in Europe, US and Africa in the last year. Indian auto component sp