Anyone who spent an equal amount on shares of Dehaier Medical Systems Ltd., Anthera Pharmaceuticals Inc. and 41 other Nasdaq-listed IPOs this year would have lost 5.2 percent, more than the 3.5 percent drop in the S&P 500 during the same period, data compiled by Bloomberg show. From 1999 to 2009, initial offerings by Nasdaq companies from Google Inc. to Priceline.com Inc. beat the benchmark index for American equity by 42 percentage points a year on average, the data show.

Newly listed Nasdaq companies aren’t growing fast enough to justify higher valuations, according to Tim Loughran, a finance professor at Notre Dame’s Mendoza College of Business in Notre Dame, Indiana. Sales will increase 20 percent as fast as the historic average for Nasdaq IPOs, analysts’ estimates compiled by Bloomberg show. All of the companies taken public by leveraged buyout firms this year have fallen on even smaller projected revenue gains.

“I’m trying to buy the next Google when I invest in an IPO,” said Loughran. Nasdaq IPOs are supposed to be “young companies with a lot of potential. If we went back in time and talked about the most cutting-edge companies we would talk about all these young companies, but they’re not there now,” he said.

Annual Gains

IPOs of companies on the Nasdaq Stock Market climbed in nine of the past 10 years, outperforming both the S&P 500 and the Nasdaq Composite Index, according to data compiled by Bloomberg. The only time before this year that new Nasdaq shares declined was in 2008, when they fell 13 percent on average. The S&P 500 and the Nasdaq Composite both slid 30 percent in the same period, the data show.

Nasdaq IPOs gained each year in the 2000 to 2002 bear market as technology stocks plummeted. They advanced an average 0.3 percent in 2000, beating the S&P 500 by 8.8 percentage points, data compiled by Bloomberg show. Investors in the Nasdaq Composite would have lost 36 percent.

So far this year, 32 of 43 Nasdaq offerings have fallen, according to data compiled by Bloomberg. The declines contrast with an average rise of 1.5 percent for initial sales on the New York Stock Exchange.

Mitel Networks Corp. of Ottawa, which sells software that lets businesses make telephone calls over the Internet, and Anthera, the Hayward, California-based developer of drugs for cardiovascular diseases and lupus, have lost more than 47 percent since their IPOs for the biggest slumps.

X-Rays, Replacement Organs

Dehaier Medical, the Beijing-based maker of X-ray machines, sleep apnea treatments and breathing devices, and Tengion Inc., the East Norriton, Pennsylvania-based company trying to grow replacement organs, have dropped more than 39 percent.

Sales for companies that debuted on the Nasdaq this year will climb 27 percent in 2011, according to analysts’ estimates compiled by Bloomberg. Revenue from Nasdaq companies in the past decade has jumped by an average of 125 percent in the year after their IPOs.

Google, the Mountain View, California-based owner of the world’s most popular search engine; Priceline.com of Norwalk Connecticut, the second-largest online travel company; and Beijing-based Baidu Inc., which operates China’s biggest search engine, increased sales by at least 92 percent in the first year after completing their IPOs, data compiled by Bloomberg show.

No Profits

Mitel’s revenue may rise 7.2 percent next year, according to analyst estimates, while neither Anthera nor Tengion had sales or profits at the time of their IPOs, filings with the U.S. Securities and Exchange Commission showed.

This year’s six Nasdaq IPOs backed by private equity firms — which typically use borrowed money to take controlling stakes in companies — will report average revenue growth of 11 percent, analyst estimates compiled by Bloomberg show. That’s 61 percent less than the average for all IPOs.

Buying their shares would have resulted in a loss of 24 percent this year, versus 2.1 percent from IPOs of companies that weren’t backed by LBO firms.

NXP Semiconductors NV, the largest Nasdaq IPO this year, may increase sales 3.9 percent in 2011, an estimate by London- based Independent International Investment Research Plc showed.

The chipmaker, acquired by New York-based KKR & Co., Bain Capital LLC of Boston and three other private equity firms at the height of the credit-market bubble in 2006, has slid 14 percent since its IPO last month. The S&P 500 declined 3 percent in the same period, Bloomberg data show.

NXP, KKR

NXP dropped more than 18 of the 20 publicly traded companies that it listed in its regulatory filing as competitors, data compiled by Bloomberg show.

KKR, the firm founded by billionaire investors Henry Kravis and George Roberts, said last month that its stake in the Eindhoven, Netherlands-based maker of semiconductors used in everything from radars to pachinko machines was now worth 50 cents on the dollar.

“We had a lot of innovative new companies coming out in the past which needed financing to grow the next market share and to grow themselves,” said Tim Hartzell, who oversees $300 million as chief investment officer for Houston-based Sequent Asset Management. Now, “a lot of this is just stuff from the private equity bubble that’s getting purged out from private equity firms,” he said.

Slower Economic Recovery

New Nasdaq companies have also fallen as concern the economic recovery is deteriorating sent stocks lower.

While the S&P 500 posted its biggest August drop since 2001 as the Federal Reserve said the economic rebound was weaker than it had anticipated, rallies by companies from Primerica Inc. to JinkoSolar Holding Co. have helped NYSE IPOs advance this year.

Primerica, the Duluth, Georgia-based insurance business that Sanford I. “Sandy” Weill used to build Citigroup Inc., has gained 42 percent since its initial offering in March. The S&P 500 retreated 6.6 percent in the same period.

The distributor of consumer-finance products from term-life insurance to mutual funds is valued at 9.53 times estimated earnings for the next year, compared with 11.4 times for the S&P 500, data compiled by Bloomberg show.

JinkoSolar, the maker of silicon wafers and solar cells based in China’s Jiangxi Province, surged 162 percent since its May IPO as the S&P 500 fell 5.7 percent. The company trades at 7.86 times next year’s profit, data compiled by Bloomberg show.

‘Degree of Optimism’

NYSE-listed IPOs are 32 percent cheaper than those on the Nasdaq, which are valued at an average of 21.9 times 2011 earnings, according to data compiled by Bloomberg.

“You have to have a certain degree of optimism and hopefulness to invest in a Nasdaq IPO, just because of the promise of the future and the growth that lies ahead,” said Jack Ablin, chief investment officer at Chicago-based Harris Private Bank, which oversees $55 billion. “With the level of uncertainty on the economic horizon, it’s certainly going to impact prospects for investors to embrace Nasdaq IPOs.”

The World Health Organization recommends mothers use Viramune to prevent passing the AIDS-causing virus to their children in the womb, and give infected infants a cocktail containing Kaletra after birth. Of 195 HIV-infected children under 2 years given that initial treatment, switching back to Viramune kept the virus under control in 56 percent of them, compared with 42 percent who stayed on Kaletra, the study showed.

About 1,000 children are infected with HIV every day, according to the Geneva-based WHO. More children in Africa are likely to start receiving anti-AIDS drugs after a previous study showed they do better when treatment begins earlier, researchers led by Louise Kuhn at Columbia University wrote in the Journal of the American Medical Association. That makes it important to ensure the drugs used are affordable and effective, they said.

The result shows children “could benefit from the switch strategy, which would allow reductions in costs of pediatric treatment programs,” Kuhn and colleagues said yesterday.

UNITAID and the William J. Clinton Foundation negotiated a price of $53 a year for pediatric Viramune in developing nations in 2010, compared with $220 annually for Kaletra, according to the Clinton foundation’s website.

Kaletra has an unpleasant taste, must be refrigerated, limits options for second-line treatment and causes side effects including raised levels of fats in the blood, the researchers said.

Resistance

Confounding the findings, Viramune failed to control the virus in about 20 percent of the children, compared with 2 percent whose disease didn’t react to Kaletra. Most of those who failed to respond to Viramune had pre-existing resistance to the Boehringer drug after being exposed to it in the womb, the researchers said.

Previous studies have shown resistance to Viramune develops in about half of children exposed to it in the womb when women take it on its own. When they combine it with other drugs, Viramune resistance drops to about 17 percent. The switch strategy should only be used where children can be tested for resistance, the researchers said. The cost of that testing could be offset by the lower cost of Viramune, they said.

The children’s guardians agreed to their participation in the trial, which was funded by the U.S. National Institute of Child Health and Human Development and Bristol-Myers Squibb Co.’s Secure the Future foundation.

Boehringer, based in Ingelheim, Germany, is the world’s biggest family-owned drugmaker. Kaletra earned Abbott Park, Illinois-based Abbott $1.37 billion last year, making it the company’s second-best seller after the arthritis drug Humira.

The bond funds took in a net $3.83 billion in the week ended Sept. 1, according to research firm EPFR Global. Stock funds lost $6.87 billion, the most in 14 weeks. Those buying debt and equities in emerging markets extended their streak of inflows to 14 weeks.

“Emerging market equity funds fared better than their developed market counterparts, while bond funds fared best of all,” the firm wrote in a press release dated yesterday.

A Bank of America Merrill Lynch index of corporate bonds around the world has rallied 8.8 percent this year as reports from U.S. home prices to Japanese gross domestic product suggest the global economy is slowing. The MSCI World Index of shares in 24 developed nations is down 4.1 percent for 2010.

The equity index pared its year-to-date loss last week as American and Chinese manufacturing reports raised optimism that the economy will avoid a recession.

Investors also withdrew $4.1 billion from money-market facilities and took $1.1 billion from funds that buy both debt and equities, the Cambridge, Massachusetts-based company said. EPFR Global tracks funds with about $13 trillion in assets worldwide.

The goal is to position Malaysian “laws as the law of choice for Islamic finance transactions globally,” the central bank said in a statement Aug. 30. Disputes about compliance with Shariah principles are a risk to the industry’s expansion, it said. Persian Gulf companies have traditionally based cross- border contracts on U.K. law to take advantage of the country’s developed legal system and neutrality, according to Unicorn Investment Bank BSC in Bahrain.

“Whilst there is nothing wrong with the Middle Eastern legal systems, many of them are archaic in their procedures,” said Nida Raza, senior vice president of capital markets at Unicorn, an Islamic investment bank in Manama. Malaysia can be “an alternative jurisdiction” as it has sukuk expertise and a system based on British common law, she said.

The Islamic finance industry, with assets of more than $1 trillion expanding 15 percent annually, needs to develop services that can win global investor confidence while taking into account different interpretations of the Koran. U.K. courts lack the expertise to decide on religious matters, according to Hussain Hamed Hassan, chairman of the National Shariah Coordination Committee of the Islamic Financial Institutions in the United Arab Emirates, and Mohamed Azahari Kamil, the head of Qatar Islamic Bank’s Malaysian unit.

Investment Dar Co., the Kuwait-based owner of half of luxury carmaker Aston Martin Lagonda Ltd., had an appeal thrown out of a U.K. court this year in a case where the company argued that financing from a bank breached Islam’s ban on interest payments.

‘Lack of Knowledge’

“Courts prefer not to decide on issues of Shariah compliance given their relative lack of knowledge in this area,” the Malaysian central bank said. “The underlying laws don’t provide sufficient platform to satisfactorily resolve dispute.”

The government set up a special committee in July to improve legislation, Muhammad Ibrahim, deputy governor at Bank Negara Malaysia, said in a speech that month in Kuala Lumpur.

The new Law Harmonisation Committee is headed by the former Chief Justice of Malaysia Abdul Hamid Mohamad, who is also a member of the National Shariah Advisory Council.

Potential changes could range from amendments to bankruptcy legislation to ensuring interest-free damage awards, Madzlan Mohamad Hussain, a partner in Kuala Lumpur at Zaid Ibrahim & Co., Malaysia’s biggest law firm, said in a Sept. 6 interview.

Middle East Acceptance

The challenge will be to gain acceptance in the Middle East because of different religious interpretations in various jurisdictions, Priya Uberoi, director of Islamic derivatives and structured products in London at Clifford Chance, the third- largest U.K. law firm by revenue, said in a Sept. 6 interview.

“Malaysia has a very good model,” Uberoi said. “It’s very robust and very sophisticated, but you can’t take one law and impose it in another country because a product that’s run in Malaysia doesn’t mean that it will be automatically acceptable in Saudi.”

Global issuance of Islamic debt dropped 12 percent to $10.3 billion so far this year, according to data compiled by Bloomberg. Malaysia accounted for more than half of the sales in the first half, the central bank’s Muhammad said.

Islamic bonds returned 10 percent so far this year, according to the HSBC/NASDAQ Dubai US Dollar Sukuk Index, while debt in developing markets gained 13 percent, JPMorgan Chase & Co.’s EMBI Global Diversified Index shows. The spread between the average yield for sukuk and the London interbank offered rate narrowed 87 basis points so far this year to 380, according to the HSBC/NASDAQ Index.

Final Say

The extra yield investors demand to hold the Dubai Department of Finance’s dollar sukuk rather than Malaysia’s 3.928 percent Islamic note due June 2015 narrowed 23 basis points this month to 390 basis points, according to Royal Bank of Scotland Group Plc data.

Malaysia practices a dual legal system with a civil court system and a separate Islamic one to govern marriage, inheritance and other family matters for Muslims.

Disputes arising from Islamic finance contracts are tried by the civil court. A central bank act issued in 2009 makes the Shariah advisory council at the central bank and the Securities Commission the highest authority in such rulings.

A group of scholars in Kuala Lumpur is helping to set up a committee to prepare the first global certification for Shariah experts, Aznan Hasan, the president of the oversight committee, said last month.

“Malaysia has an infrastructure to put finality to Shariah-based disputes” such as Investment Dar’s, Madzlan of Zaid Ibrahim said.

Yet rather than ask managers to come up with a fix, Pitney Bowes (PBI) executives put the challenge to the workforce. Within days, employees proffered a solution that the company then implemented. “It goes far beyond management deciding to change and to innovate, and there are so many good ideas that could be acted on that are with the people who are right there every day, dealing with customers,” says Pitney Bowes Chief Executive Officer Murray Martin. A measurable increase in customer satisfaction was “almost immediate.”

Under pressure to add growth while keeping research costs in check, companies are striving to get better at tapping in-house expertise. Pitney Bowes, AT&T (T), Cisco Systems (CSCO), Electronic Arts (ERTS), Wal-Mart Stores (WMT), and MetLife (MET) are using software and other tools to mine the collective intelligence of their workforce, organize the resulting suggestions, and then predict which ones are most likely to succeed.

Pitney Bowes, which in the past used a suggestion box to get input from employees, now relies on a program called Idea Central from U.K.-based Imaginatik Plc (IMTK:LN). Since 2008, Pitney Bowes executives have asked workers to tackle 42 different challenges and received about 3,000 ideas. The company has implemented or plans to put in place about 700 of those, Martin says. About 10,000 employees of Stamford (Conn.)-based Pitney Bowes use Idea Central.

$250 MILLION MARKET

Companies spend an annual $250 million on collective intelligence tools, says Imaginatik Executive Vice-President Luis Solis, who estimates that the market is growing 15 percent to 30 percent a year.

Video game publisher Electronic Arts (ERTS) wanted to do a better job predicting which games would succeed to more effectively allocate marketing dollars. So it surveyed employees using software from San Francisco-based Crowdcast. Forecasts based on that polling turned out to be more accurate than the company’s own projections, according to Crowdcast CEO Mat Fogarty.

AT&T, the largest U.S. telephone company, uses software sold by Spigit Inc. to let employees generate ideas and bet on which ones will succeed. AT&T now has about 40,000 employees that have signed up for its internal network called The Innovation Pipeline. AT&T was among 164 companies that attended an Aug. 19 customer conference sponsored by Spigit in Half Moon Bay, Calif. “We wanted to democratize how we innovate at AT&T and take it out of the labs,” AT&T innovation leader Patrick Asher said at the conference.

The company spends several million dollars a year on collective intelligence, Asher said. It has sought feedback in such areas as customer service and how to deploy Long-Term Evolution, a next-generation wireless technology, more rapidly. Each quarter, AT&T senior executives fund a handful of what they consider the best ideas.

Tokyo’s office vacancy rate has fallen for the first time in 2 1/2 years, demand for housing is rising and a decline in land values has slowed, making real-estate more attractive, Merrill Lynch strategist Masatoshi Kikuchi said. The Bank of Japan, which kept borrowing costs unchanged yesterday, should also help to spur a recovery in real estate, he said.

“We can see now that the decline in demand for real estate has pretty much bottomed out,” Kikuchi said in an interview in Tokyo. “Also, because Japan’s interest rates will remain low, we should see a recovery and investors should start buying these shares.”

The Bank of Japan kept the benchmark overnight rate at 0.1 percent, where it has been since December 2008. The Topix Real Estate Index, measuring 44 property-related stocks, has risen 12 percent from this year’s low on July 22, compared with the broader Topix’s 0.5 percent decline during the same period.

Tokyo’s office vacancy rate fell in July for the first time since January 2008, according to an Aug. 5 report by Miki Shoji Co., a privately held office broker. The number of condominiums offered for sale in Tokyo and surrounding areas rose 27.8 percent in July from a year earlier, the Real Estate Economic Research Institute said on Aug. 16.

Land Values

Japan’s land values also declined at fewer sites for a third straight quarter as property companies started to purchase land amid a recovery in housing demand, the Ministry of Land, Infrastructure, Transport and Tourism reported Aug. 24.

Kikuchi told a seminar yesterday in Tokyo that Japan’s stock market should recover further next year, with the Topix index rising to between 9,000 and 12,000 from January to March as the global economy strengthens. The Topix closed at 820.99 today.

While foreign investors now view Japan’s equities as a minor part of their global portfolios, Japan should be able to capitalize on Asia’s emerging growth and increase interest in Japanese companies, he said.

Top Ranked

Kikuchi spoke yesterday at an investment seminar attended by more than 1,700 people, including 300 foreign investors. The number of foreigners at the annual conference jumped from 279 last year, an increase that shows overseas interest in Japanese equities has risen, Kikuchi said.

Kikuchi was rated Japan’s top strategist in rankings by the Institutional Investor magazine’s 2010 survey and came second in the Nikkei Veritas newspaper’s Japanese strategist rankings this year, according to Merrill Lynch.

At a seminar on Jan. 13, Kikuchi said the Nikkei 225 Stock Average would rise to 13,000 from 10,735.03 by about May as a weaker yen bolstered company earnings. The gauge climbed 5.6 percent to this year’s high of 11,339.3 on April 5, and then plunged 12 percent in May.

Kikuchi also said the Nikkei 225 may rise 12 percent to 8,500 by the end of March 2009 in a note to clients on Feb. 27 last year. The gauge closed at 8,636.33 on March 26, 2009, and rose 7.2 percent that month.

The central bank sent out a document last week allowing banks to apply for ruble trading licenses and the approval process may take three weeks, according to one of the bankers, who asked not to be identified because the process isn’t public. The People’s Bank of China started yuan trading against the Malaysian ringgit on Aug. 19.

Cross-border trade using China’s currency more than doubled to 48.7 billion yuan ($7.2 billion) in the second quarter from the first, according to central bank data, and regulators are encouraging sales of yuan securities offshore. Billionaire Oleg Deripaska’s United Co. Rusal is planning Russia’s first offering of renminbi bonds.

“The push for the internationalization of the yuan is intensifying,” said Dariusz Kowalczyk, a Hong-Kong based senior economist at Credit Agricole CIB. “This is meant to eliminate the dollar from trade settlement.”

A press officer at the People’s Bank, who refused to be named because of the agency’s rules, declined to comment.

China allows trading of its currency, the renminbi, versus the dollar, Hong Kong dollar, Japanese yen, the euro, British pound and ringgit on its interbank market. The Foreign Exchange Trading Center provides daily reference rates for the currencies.

Trading Partners

HSBC Bank (China) Co. and Bank of Communications Co. completed the first yuan-ringgit transactions, according to the trading center, which is affiliated with the central bank. The central bank was investigating the possibility of offering new currency pairs on the interbank market, including the ruble, won and ringgit, an unnamed official at the center said in April.

Brazil, Russia, China and India, known as the BRIC nations, have stepped up cooperation to ensure that the interests of developing nations are taken into account at the Group of 20, which holds a meeting in Seoul in November.

Russian President Dmitry Medvedev in June called for a greater number of reserve currencies in the global financial system. Ba Shusong, deputy head of the financial institute of the State Council’s Development Research Center, warned dollar volatility may affect the value of China’s $2.45 trillion foreign-exchange reserves.

Less Need for Dollars

The trend for developing nations to start trading in each others’ currency “should lead to a lesser need for the dollar in the market,” said Douglas Borthwick, Connecticut-based managing director at Faros Trading LLC. “It will certainly help slow the constant increase in China’s dollar reserves over time.”

China overtook Germany as Russia’s second-largest trading partner in the first six months of this year, helped by exports from Russian commodity producers including Rusal, OAO GMK Norilsk Nickel and OAO Rosneft.

Rusal, the world’s biggest aluminum producer, is preparing for a yuan bond sale, Oleg Mukhamedshin, head of capital markets, told reporters at a China investment conference in Moscow on Sept. 2. The Moscow-based company owns two smelters in China. Yuan deposits in Hong Kong have risen 65 percent this year to 103.7 billion yuan, the highest level since the Hong Kong Monetary Authority allowed yuan accounts to be set up in February 2004.

He kept his part of the bargain and lines of Coke and Diet Coke cans glisten behind the glass screens of the fridge. A red- and-white banner, with Bollywood film star Aishwarya Rai chugging a bottle of the cola, adorns his store front. Yet Yadav doesn’t mention his partner when he describes his shop.

“I sell Pepsi and cigarettes,” said Yadav in Hindi, elongating the first syllable to pronounce the word “Pay- psee.”

Yadav isn’t reneging on his deal with Atlanta-based Coca- Cola. Pepsi became a common synonym for cola in India’s most widely spoken language after having the market to itself for three years until 1993. PepsiCo Inc.’s linguistic advantage translates into higher sales. Its cola brand’s market share is 73 percent greater than Coke’s, according to Euromonitor, a consulting firm.

Coca-Cola pulled out of India in 1977 after a change in government regulations would have forced it to partner with an Indian company and share the drink’s secret formula. In 1988, PepsiCo formed a joint venture with two Indian companies and introduced products under the Lehar brand. Lehar Pepsi was introduced in 1990. Coke re-entered the market in 1993, after Indian regulations were changed to allow foreign brands to operate without Indian partnerships.

Catch-All Term

“Pepsi got here sooner, and got to India just as it was starting to engage with the West, and with Western products,” said Lalita Desai, a linguist at Kolkata’s Jadavpur University who studies how English words enter Indian languages. “And with no real international competition, ‘Pepsi’ became this catch-all for anything that was bottled, fizzy and from abroad.”

In much of the Hindi-speaking belt of northern India, home to three of the five most populous states, children begging at street corners will point to bottled juices inside cars and plead for “Pepsi.” Mahipal Singh, a 42-year-old truck driver who plies a route between New Delhi and Bihar, calls his rest stops “Pepsi-wepsi” breaks, regardless of what he is drinking.

“Saying ‘Pepsi’ connotes getting a soft drink,” said Kiran Bhushi, an anthropologist at Indira Gandhi National Open University whose research is focused on consumption patterns of India’s middle class and has consulted for both companies. “How exactly does someone like Coke dislodge this idea from a consumer’s brain?”

Evangelical Task

In addition to competition from Pepsi, Coca-Cola, which was unprofitable in India for 15 years, has to contend with consumer preferences for other drinks. About 90 percent of India’s beverage market is composed of tea, milk and coffee-based drinks, with bottled soft drinks holding less than 5 percent, according to Harish Bijoor, who runs a brand consulting and strategy business out of Bangalore. The company relies on drinks other than Coke to be the country’s top beverage seller.

“Cola in India is still an evangelical task, because it’s not a lifestyle habit yet,” said Bijoor.

Coca-Cola needs growth in overseas markets to offset at least four years of declining sales volumes for its soft drinks in the U.S. Sales by case volume grew 29 percent in China and 20 percent in India last year. The company announced in March 2009 that it would invest $2 billion in China over a three-year period.

India’s economy expanded 8.8 percent in the three months through June, the fastest pace in 2 ½ years. Growth in the U.S., the biggest market by revenue for both Coca-Cola and PepsiCo, slowed to 1.6 percent.

Sales Growth

Still, sales by volume in India surged 31 percent in 2009, Coca-Cola Chief Executive Officer Muhtar Kent said in February without providing specific numbers. Indian sales of Coca-Cola, Diet Coke and Coke Zero grew 25 percent, according to the company’s annual report. Coca-Cola last year turned a profit in India for the first time since re-entering the country in 1993 after a 16-year absence, according to Kamlesh Sharma, a New Delhi-based spokesman.

While Coca-Cola uses the cola brand to drive market share in other countries, the company’s top three products in India by sales volume are Kinley bottled water, Thums Up cola, and Sprite, according to Euromonitor. Mirinda ranks fourth and the Coca-Cola brand is at No. 5. Thums Up, a lemon drink called Limca, and an orange drink called Gold Spot were acquired by Coca-Cola in 1993.

“Pepsi is bigger than Coke as a brand, but Coke as a company has very smartly introduced other brands that have done very well,” said Bijoor, the consultant.

Coke’s Strategy

That’s Coca-Cola’s strategy, said Atul Singh, the company’s president for India and South West Asia.

“We want every part of our portfolio to grow, so that any consumer, on any occasion, anywhere in India, makes a choice to drink a Coca-Cola product,” he said. He said he was not aware that Hindi-speaking consumers often use ‘Pepsi’ as a generic term for colas.

Purchase, New York-based PepsiCo will invest “aggressively” in emerging markets, according to Chief Executive Officer Indra Nooyi, who was born in India. Its sales in Asia, the Middle East and Africa grew 12 percent in 2009. The company, which is also the world’s largest snack-food maker, in May said it will invest $2.5 billion in China over three years. Retail sales of its products in India, including Frito-Lay potato chips, Quaker Oats and fruit juices such as Tropicana, are worth $1.5 billion. PepsiCo had $43.2 billion sales last year.

‘Big Positive’

“The Pepsi brand becoming the default name for the cola category is certainly a big positive,” Sandeep Arora, a company spokesman, said by e-mail. “It can also be a double-edged sword if the marketer is not able to differentiate the brand from the rest of the category.”

Coca-Cola has run an advertising campaign called “Thanda Matlab Coke,” which translates to “Cold Means Coke.” North Indians speaking in Hindi regularly use “thanda,” the word for cold, as a noun when offering someone a drink.

“It was definitely a good idea,” said Bhushi, the anthropologist. “If Pepsi means cola, then emphasizing that a ‘thanda’ means Coke is perhaps the best way to gain control of the vocabulary.”

“Thanda Matlab Coke” runs across the red-and-white poster at Yadav’s New Delhi store. His biggest seller, though, isn’t Coke.

“People ask for Pepsi, and I give them a Thums Up or a Coke,” he said. “Thums Up they don’t mind, but Coke, sometimes they say no.”

The Finnish company is likely to focus attention at Nokia World in London on its high-end Symbian smartphone line, including the touchscreen N8, its latest effort to take on Android and iPhone handsets. The N8, announced in April, has an anodized aluminum case surrounding a 3.5-inch screen, with streaming and on-demand television services to show it off.

“This year, even more than last year, people are really eager to see what Nokia has done to close the gap with the competitors,” said Carolina Milanesi, a research director with Gartner Inc.’s U.K. unit. “With the N8 shipping, developers will have a product that will sell very well despite not being perhaps the high-end product people are expecting.”

For Chief Executive Officer Olli-Pekka Kallasvuo, the event offers a chance to show he can turn the company around amid speculation Nokia is seeking to replace him. Nokia shares have slumped 60 percent since Apple introduced the iPhone in June 2007 and the company’s market share in smartphones, the fastest- growing part of the industry, has shrunk.

Nokia will introduce devices and services on the revamped Symbian 3 operating system, according to a person with knowledge of the plans, with the N8 being the first of the new line. It’s unlikely to make major announcements on the MeeGo operating platform it’s developing with Intel Corp., the person said, declining to be identified because the plans aren’t public.

Promotional Push

Marketing efforts for the event on Sept. 14 and Sept. 15 include a press event in Helsinki today, a promotional film featuring former Playboy model and Baywatch star Pamela Anderson, shot with the N8 camera, and a prize winner chosen by lottery. Nokia has held the annual event for customers and the press since 1996. In Stuttgart in 2009, it drew 1,800 attendees.

This year’s event “will beat that number by a mile — in fact it’ll be the largest Nokia World we’ve ever had,” spokesman James Etheridge said.

Nokia needs strong holiday sales with new devices to meet its goal of rebuilding device margins to 10 to 11 percent for the year after lowering forecasts for two consecutive quarters. The company has indicated it’s filling the pipeline with handsets running the new Symbian and also promised that MeeGo devices will start shipping this year.

‘Faster, Simpler’

Nokia shares rose as much as 2.9 percent, following a 4.5 percent gain yesterday after analysts at Morgan Stanley and Merrill Lynch said in reports they expect the N8 to sell well and raise Nokia’s average selling prices, or ASP, which have declined in recent quarters.

“The N8 is off to a good start,” Morgan Stanley analysts including Patrick Standaert wrote in their report. Early checks indicate “strong order intake from operators and a lower discount than feared,” they wrote.

The presentation in Helsinki today highlighted the N8’s 12- megapixel camera, high-definition video recording, navigable 3-D maps and ability to mirror its display on a television screen.

“This is faster, it’s simpler, and the capacitive display is more pleasant to use” compared with earlier Nokia touchscreens, said product manager Esa Alanen.

Fleet of Products

Kallasvuo said in July that Nokia plans to ship more than 50 million Symbian devices in coming years. The company’s last hit high-end smartphone, the N95 which introduced navigation, sold more than 10 million devices in the two years after it shipped in March 2007.

Nokia also signaled in July that it plans to have a fleet of Symbian 3 products for the holiday season, helped by the standardization of the new platform. The N8 was announced at an initial price of 370 euros ($489) before taxes and subsidies.

The N8 appears on Nokia’s websites for preorders and also appears on Vodafone Group Plc, T-Mobile, and Carphone Warehouse sites in the U.K.

Nokia may ship as many as 10,000 N8s a week during the early launch in the U.K. alone, Morgan Stanley said. The official ship date for N8 preorders in Finland is Sept. 30, spokesman Tapani Kaskinen said by e-mail.

The phone lists for 498.90 euros on the website of Finnish retailer Verkkokauppa and a more expensive version that includes all-you-can-eat track downloads from the Music Unlimited service will also be introduced in Finland, Nokia said.

C7 and E7

“I’m expecting to see a couple of other products, such as the C7, a cheaper version with a couple of features taken out and a more plastic look and feel, and the E7, an enterprise version of the N8 with a full Qwerty keyboard,” said Sami Sarkamies, a Helsinki-based analyst at Nordea Bank.

Neither model has been announced by Nokia although Mobile Review and other blogs have published reports about them. Nokia spokeswoman Arja Suominen declined to comment on speculation about the products or the content of Nokia World, citing the company’s longstanding policy.

“I think they’re going to focus on C7, which is more appealing than N8; it’s a smaller, cheaper, thinner version of the N8 and it’s probably a device that has more commercial appeal,” said Tero Kuittinen, an analyst at Greenwich, Connecticut-based MKM Partners.

Nokia said in July that the operating margin in devices could fall as low as 7 percent in the third quarter as it prepared to release the N8. The margin was 12.5 percent last year and 18.2 percent in 2008. In July, Nokia posted a 40 percent drop in second-quarter profit.

Shrinking Share

Nokia had 34.2 percent of the overall mobile-phone market, compared with 36.8 percent a year earlier, according to researcher Gartner Inc. Its smartphone share fell to 37.4 percent from 45 percent in the second quarter of 2009.

“Apple has been taking huge chunks of revenue and profit share from Nokia,” said Neil Mawston, a London-based analyst at Strategy Analytics. “Apple’s ASPs are only falling at about 2-3 percent year on year, whereas Nokia’s smartphone ASPs are declining at roughly 20 percent.”

Merrill Lynch analysts including Andrew Griffin wrote yesterday that the N8’s higher average selling price makes it likely Nokia will meet 2010 consensus earnings estimates.

Last year, Nokia showed the N900, its first product on MeeGo’s predecessor-platform Maemo, as well as the N97 mini, an improved follow-on for the N97 Symbian smartphone, the new X series music phones and a deal to link software to Facebook.

MeeGo Transition

“It will be interesting to see whether Nokia has come up with the upgrade to the N900 or waits longer to come up with proper MeeGo products,” said Milanesi.

Alberto Torres, the Nokia executive who leads MeeGo, isn’t currently listed in the speaker lineup for Nokia World.

“They’ll also have to address how they’re planning to segment the portfolio, exactly where Symbian stops and MeeGo begins,” said Mawston. “They’ll get so many questions on it, they’ll have to say something.”

The euro gained after demand rose at a Portuguese bond sale and Poland’s auction of five-year debt attracted the strongest bids since 2008. The yen fell against a majority of the 16 most- traded currencies after Japan’s Finance Minister Yoshihiko Noda said he is prepared to take “bold” steps on currencies if necessary. A Federal Reserve business survey found the economic rebound showed signs of slowing.

“The Dow is up, which was negative for the safe haven currencies today,” said Michael Woolfolk, senior currency strategist in New York at Bank of New York Mellon Corp., world’s largest custodial bank, with more than $20 trillion in assets under administration.

The yen fell 0.1 percent to 83.92 at 4:03 p.m.in New York, after touching 83.35, the strongest level since May 1995. The dollar declined 0.3 percent against the euro to $1.2716.

The Standard & Poor’s 500 Index rose 0.7 percent, reflecting reduced concerns about a slowing economy. It declined 1.2 percent yesterday.

The Canadian dollar gained as the Bank of Canada raised its benchmark interest rate by a quarter-percentage point to 1 percent. The loonie, as the Canadian currency is known, added 1 percent to C$1.0374 per U.S. dollar.

Swiss Strength

The Swiss franc traded near a record high against the euro. The franc declined 0.4 percent to 1.2871 against the euro, after touching 1.2766, the strongest since the single currency’s 1999 inception. It earlier touched 1.0061 per dollar, approaching parity with the greenback for the first time in nine months.

Portugal sold 1.04 billion euros of bonds maturing in 2013 and 2021. The 2021 securities drew bids for 2.6 times the amount offered, compared with a bid-to-cover ratio of 1.6 in the March sale.

European central banks bought Greek, Irish and Portuguese bonds, according to a trader involved in the transactions, as the securities’ premiums to German debt surged for a third day.

The premium investors demand to hold Portuguese 10-year bonds instead of benchmark German bunds reached a record 372 points yesterday before trading at 350 basis points today.

Market Moves

“They’re trying to make sure that the markets remain liquid,” said Win Thin, a senior currency strategist at Brown Brothers Harriman & Co. in New York. “Even though spreads have been widening out, they’ve kept low purchases because they’ve felt that markets are actually working. There is two way flow, the markets are not seizing up.”

The euro may drop 4 percent to a level against the dollar last reached in July if a support level is breached, according to Citigroup Inc.

If the euro falls below the support level of $1.2588, it could drop as low as $1.22, Tom Fitzpatrick, chief technical analyst at Citigroup in New York, wrote in a research note to clients. That level was last touched on July 1. Resistance for the euro can be found at $1.2923, he wrote.

The U.S. economy maintained its expansion while showing “widespread signs of a deceleration” in mid-July through the end of August, according to a survey by 12 regional Fed banks.

The report underscored the Fed’s view that while the recovery from the worst recession in seven decades has cooled, the economy isn’t relapsing into a contraction. In a speech last month in Jackson Hole, Wyoming, Fed chairman Ben S. Bernanke said “the preconditions for a pickup in growth in 2011 appear to remain in place.”

“The Fed’s beige book was consistent with the last Federal Open Market Committee announcement,” said Amelia Bourdeau, a currency strategist in Stamford, Connecticut, at UBS AG. “There is some growth in the economy, but there are signs of the growth decelerating.”

Yen Trade

The yen has advanced 16 percent this year, the biggest gain among the developed-world currencies, according to Bloomberg Correlation-Weighted Currency Indices. The euro has dropped 10 percent and the dollar is up 2.7 percent.

Japan’s current-account surplus expanded 26 percent from a year earlier to 1.68 trillion yen ($20 billion), the Ministry of Finance said, surpassing the 1.53 trillion yen surplus forecast by economists in a Bloomberg News survey.

Gains in the yen were reversed after Finance Minister Noda told reporters in Tokyo the government is watching markets closely and potential measures to counter the yen’s appreciation include intervention.

“There may have been some players who sold the yen on his comments,” said Hisanao Sasaki, vice president of foreign exchange at Oversea-Chinese Banking Corp. in Singapore.

Japan hasn’t intervened in the foreign-exchange market since 2004, when the currency was at about 109 per dollar.

Aussie Performs

The pound and the Australian dollar were among the best performers among the 16-most traded currencies. A gauge of U.K. house prices unexpectedly rose in August and manufacturing expanded for a third month in July.

The pound appreciated 0.4 percent to 82.22 pence against the euro after reaching 82.02 pence, the strongest level since Aug. 31.

The Aussie reached a one-month high versus the greenback before a report tomorrow forecast to show employers added positions for a sixth month, increasing pressure on the central back to resume raising interest rates.

Australia’s dollar rose 0.7 percent to 91.72 U.S. cents from 91.06 cents yesterday, after reaching 91.94 U.S. cents, the highest level since Aug. 9.