OPINION ON POST COVID-19 COMPANIES WHICH WILL BE IMPACTED - IMPACT ON SHARE MARKET

POST COVID-19

FACTOR DETERMINING SUPPLY SIDE – SUPPLY OF PRODUCTS AND SERVICES

1. RAW MATERIAL
2. LABOUR
3. GEO GRAPHICAL LOCATION
4. TRANSPORTATION OF GOODS
5. OTHER FACTORS

FACTORS DETERMINING DEMAND SIDE- DEMAND OF PRODUCTS AND SERVICES

1. PRICE
2. INCOME AND CAPACITY OF BUYER
3. WILLINGNESS TO BUY OR POSTPONE THE PURCHASE DUE TO LACK OF LIQUIDITY IN NEAR TERM (SHORT TERM)
4. OTHER FACTORS

RAW MATERIAL
GENERALLY POST COVID-19, I SEE RAW MATERIAL MAY NOT BE AVAILABLE FOR MANY PRODUCTS DUE TO LACK OF WORKERS BEING MOBILISATION, LETS SAY READY MADE GARMENT WE ARE TALKING ABOUT, BUT SINCE COTTON PRODUCTION ON FARM. IT IS ALSO NOTED THAT PRESENT STOCK OF CLOTH MAY BE THERE AND MAY BE UTILISED IN FIRST 2 MONTH (AS PER CYCLE OR THEY MAY HOARD FOR BETTER PRICE).

LABOUR
LOCAL LABOUR MAY COME TO WORK BUT MIGRANT LABOUR MAY NOT COME TO WORK THAT EASILY. EVEN LOCAL LABOUR MAY LOOK TO OTHER COMPANIES WHO ARE OFFERING THEM BETTER WAGES SO THERE MIGHT BE DISRUPTION.

GEO GRAPHICAL LOCATION
AN INDUSTRY OR A COMPANY HAVING NEARNESS TO THEIR SUPPLIERS WILL HAVE MORE BENEFICIAL AS THEY WILL MORE FREQUENTLY ABLE TO VISIT THEIR SUPPLIERS AND THEY WILL ABLE TO ACCESS THEM AND SITUATIONS AND TAKE DECISIONS.
AN INDUSTRY OR COMPANY NEAR TO THEIR CUSTOMS WILL HAVE MORE DEMAND ACCESS AND WILL ABLE TO TAKE TIMELY DECISION ON SUPPLY.
SO COMPANIES HAVING ONE OFFICE NEAR TO THEIR SALES AND FACTORY NEAR TO THEIR RESOURCES WILL BENEFIT.

TRANSPORT OF GOODS
IF COVID 19 HAS RESULTED INTO LIFTING OF LOCKDOWN IN PHASED MANNER, IT WILL RESULT INTO MORE TRANSPORTATION COST FOR COVID-19 AFFECTED AREAS AND STABILISING AFTER REDUCTION IN CASES OR AFTER CERTAIN TIME PASSES ON.

DEMAND SIDE
PRICE
PRICE OF CERTAIN GOODS/SERVICES WILL SOAR AND PRICE OF CERTAIN GOODS/SERVICES WILL DECLINE BASED ON THEIR ESSENTIALITY. PEOPLE WILL ALSO SPARE SOME MORE MONEY TOWARDS INSURANCE.

INCOME/CAPACITY OF BUYER
PEOPLE INCOME BEING BADLY AFFECTED THEIR PURCHASING POWER WILL BE AFFECTED AND WILL RESULT INTO LOWER CONSUMPTION OF NON ESSENTIAL GOODS.

REALTY SECTORS AND FINANCE SECTORS WILL BE WORSELY AFFECTED AND MANY OF BUILDERS MAY TURN BANK KRUPT. THERE WILL BE NEW OPPORTUNITIES AS WELL, LIKE CERTAIN NEW START UP IS USING THIS OPPORTUNITY AND SUPPLYING FOOD DOOR TO DOOR, IF THEY SUPPLY QUALITY (THOUGH AT HIGHER PRICE) AS OF NOW AND AFTER SITUATIONS NORMALISE, THEY MAY STILL REMAIN IN PLAY OR ELSE THEY WILL BE OUT.

AGRICULTURAL SECTOR, AGRICULTURAL SECTOR WHERE THERE IS AVAILABILITY OF LABOURERS AND RESOURCES WILL FLOURISH AND MAY FETCH HIGHER RETURNS

DESPITE ALL ABOVE , SOME POSITIVE OUTLOOK, CERTAIN COUNTRIES LIKE JAPAN MAY START REMOVING THEIR CERTAIN BASIC SECTORS LIKE MEDICAL FROM CHINA TO THEIR COUNTRY AND SOME OTHER COUNTRIES IF THIS WORK OUT THIS MAY BE USED AS OPPORTUNITY ( THOUGH CERTAIN COUNTRIES LIKE BANGLADESH AND OTHER AFRICAN COUNTRIES PROVIDE CHEAPER LABOUR AND TAX FREE ZONES MAY GAIN MORE IMPORTANCE).

CERTAIN COUNTRIES NOW REQUIRE THEIR COMPANIES TO DIVERSIFY THEIR MANUFACURING PORTFOLIO ACCROSS THE GLOBE AND THIS MAY BE TAKEN POSITIVE OR NEGATIVE.

I REQUEST FOR OPINION OF DIMERS AND SOME SHARE MARKET COMPANIES HAVING WORKERS AND RESOURCES NEARNESS TO THEIR FACTORY AND MAY LEAD AFTER LOCKDOWN IN BSE OR NSE.