Rising oil prices, a threat

Updated: Dec 31 2006, 06:46am hrs
I strongly believe that 2007 should be the year of oil and gas, metals and auto ancillaries. These are the sectors that will do well.

I also think that the dark horse would be the media and entertainment industry, the industry has tremendous potential. Overall, I think that India should attract serious international fund inflows in the year 2007.

It is important to note that the money flowing in is expected to be for the long-term as India will continue to be a preferred emerging market destination.

At the same time there are certain concerns that investors should be careful about and pay closer attention to. Rising oil prices will be an ongoing threat. In addition, higher input costs have the ability to impact corporate profitability.

One of the concerns is also the acute shortage of skilled labour; this can hamper the potential offered by the economy and also thwart investment plans.

Lastly, managements will be checked on the promise versus execution criteria. This will remain a challenge for India Inc.

The author is investment advisor, Enam Securities