Foreign investors immediately rushed to pick up scrips at the low prices, as they could rest assured that political tussle would not spoil the economic scene or sentiment at least for some more months.

The domestic industry has been gathering courage slowly in vibe with the signs of economic recovery over the last eighteen months, resulting in the pick up in domestic investments in the year 1998-99. Investment proposals for a total of Rs 17372 crore has been pledged in 1998-99. This is impressive, considering that the previous year saw a bare 0.5 per cent growth. However, on the FDI front, FDI inflows have slowed down by around 19 per cent or Rs 7961 crore. This should cause serious concern as even in the earlier year, there was a decline of 8 per cent. This calls for immediate attention from the new government.

The FDI investments have been extremely selective. The cement industry attracted the highest investment at Rs 682 crore, thus endorsing investor's perception of the industry. However, the industry is bound to take a dent on its bottomline due to the recent rise in diesel prices, which would jack up transportation costs for raw material and finished goods.

It remains to be seen whether the industry manages to pass on the rise in cost both on account of transport and higher fuel costs to the customer or has to be absorbed by itself. But in any case, the euphoria on the sector would have to be cooled down.

But markets have never been rational or rather they see the reason with delay. The current upsurge in the market saw the stock quotes of Larsen & Toubro, Gujarat Ambuja, ACC and others recovering what they had lost in the last two weeks. Put this industry on your watch list as it could respond with delay to diesel hike. But given a good long term outlook, there is every reason therefore for the trader and investor to be on the look out whenever cement stock prices move down.

The diesel logic is applicable to the commercial vehicle and tractor industry as well. We need to watch commerical vehicle take off figures in the coming months to decide your stance on Telco and Ashok Leyland. The transport sector has attracted the second highest investments in terms of FDIs. More investments here could mean stiffer competition for local players, as fully owned transport subsidies are being set up here by international players. But the Indians seem to be ready for the competition, with the lauch of more models.

TVS is on the uptick, Hero Honda is still confident of holding its own turn and LML is going ahead with lauch of new products and could now be expected to make new tie ups for technology. MTNL has gone on the offensive and the markets have greeted this stance. The telecommunication sector has attracted an investment of Rs 396 crore the field of venture capital is slowly opening up for the software sector. Even local players are entering the field.

The software industry has been seeing the entry of more foreign players setting up shop here. The need for India is to enable the California Silicon Valley culture here. We need to bring in the entrepreneur-venture capital investment clubs, like what England has kicked off. The Indian bankers may be hesitant, but the day is not far off, when foreign venture capitalists would come forward more aggressively with the yet unexplored opportunities.

The time is ripe, as the market has a strong appetite for software IPOs. The pharma industry is already witnessing arerating of the scrips in the industry. While companies like Dr. Reddy and Ranbaxy are getting re-rated for their discovery of new molecules, other companies are getting re-rated for their research infrastructure, both manware and hardware.

One another important trend the investor should not miss out is the coming to age of several other pharma companies, which have been under discounted all these times, in relation to their earnings track record and growth rate.

Sun Pharma has been continuously on the uptick in a rerating that recognises its product specialisation. Other scrips like Aurobindho Pharma and Orchid Chemicals are being re-rated, giving due credit to their very impressive growth rate. The return on networth has been comparable to the best. Not only that, these companies are investing more to keep pushing their volumes both on the domestic and global markets. They are making intelligent choices in terms of constantly changing the product mix between basic drugs for the global market, and increasing share of the formulation market. The introduction of the patent regime may be no threat as they can thrive on the global demand for ongoing bulk drugs and catering to the generic domestic market. These companies are giants in the making,and will attain positions similar to Dr. Reddy in two years time down the lane.

Whether it be transport, software or pharma, it is time to be investing in growth stocks, as the new government would be under even more pressure to perform on economic front to win the voter's confidence.