The last time I professed to have any understanding of stock markets was around the time I had acquired my MBA degree (in 1982) with a major in finance and marketing.

Since then, it has been one long struggle to understand the rationale of the extreme upward or downward movement of the market indices or the logic and methodology used by various stock market analysts and punters posing as investors.

Currently, I feel totally at a loss to understand the rationale behind the rise in the stock prices of a very wide array of public companies -- many of them in the textile sector (please note: textile companies i.e. fibre, yarn and fabric companies and not clothing manufacturing companies since hardly any are listed on the stock exchanges) with many of them gaining as much as 50 per cent to 60 per cent in value in just the last one week or so.

The apparent trigger for this rise is the reported statement in some sections of the media that Wal-Mart is looking at increasing its sourcing from India to as much as $ 10 billion in the next few years.

There is, of course, no confirmation or any official statement to this effect from the purported buyer i.e. Wal-Mart, but this has not detracted the analysts to predict windfall for almost every listed company in India that can supposedly supply to Wal-Mart.

Of course, most of these armchair analysts have perhaps never ever been inside a Wal-Mart super centre in their lives or else they could put a 'buy' on almost every listed consumer products business in India, since Wal-Mart now retails almost every consumer product category one can think of.

Respectable business magazines have already added the Wal-Mart factor in the plethora of 'feel-good' stories being churned out in every issue with one such publication somehow managing to get the inside information that Wal-Mart is likely to source up to $20 billion of merchandise from India and Mexico (I wonder what the connection is between these two potential supplier countries!).

On the textile sector in particular, many of these analysts have recently discovered that textile quota's are likely to go away at the end of 2004 and it seems that most believe that India then will have the entire international textile and clothing market available to itself.

What completes my amazement is the fact in the same media, almost every day reports are coming out about the very hostile welcome India (and some Indian businesses) is giving to one of the largest retailers in the world: Metro of Germany who have recently opened a centre in India and have already been slapped with all kinds of litigation and agitations beside overt and covert lobbying against their functioning in India.

Metro, incidentally, is also one of the largest buyers in the world with global sourcing volume estimated in excess of $ 30 billion! The Government of India clearly discourages operation of international retailers in India and yet it expects the same international retailers to plan for multi-billion dollar sourcing volumes from India!

Some points may be relevant here. Firstly, to export in tens of billions of dollars to a single (or a few customers), we must have a wide range of product categories that can be produced at the right quality and the right prices for the export markets.

Wal-Mart, Metro, Carrefour, Tesco and other global retailers have exceptional buying experience and leverage: they buy large volumes of high quality merchandise with exacting delivery standards at extremely competitive prices.

Secondly, they buy 'floor ready' merchandise and not 'raw material'. Thirdly, they buy from a relatively small number of suppliers implying that each of the suppliers must be a reasonably large company by international standards and not the puny Indian 'small' or 'medium' scale.

Finally, while becoming a supplier to many such retailers will guarantee big jumps in the top-line revenues of such supplying companies, making profit from such demanding customers would require exceptional manufacturing efficiencies and outstanding customer relationship management efforts.

Many of the currently listed companies who have seen their stock prices shoot up on the Wal-Mart factor are not exactly known for either of these skills.

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