Archive for February, 2009

The irony of Harshad Mehta

Thursday, February 26th, 2009 February 26th, 2009 Joydeep Ghosh

I met him once in mid-1998. Actually, I tagged along with my bureau chief B Krishnakumar (The Week).

In 1998, the stock market had again started misbehaving. In the first few months, it had shot up, only to crash within days. And some stocks, especially the ones whose promoters were advised by the big bull were doing exceptionally well.

We wanted to explore this line of investigation. On reaching his Maker Chamber office at 5 pm, we were made to wait for almost an hour – he was still being quizzed by CBI sleuths everyday.

My only memory about the office is that it had a rather glassy look about it, and there wasn’t a single sheet of paper, anywhere.

When Mehta came, he looked and sounded quite calm – a remarkable feat for someone, who was being grilled for six-eight hours a day. He told us about his new role as a corporate advisor (without naming the companies, of course) and offered us chai.

He also told us about the 24 criminal cases and over 300 civil cases against him. Later, I was told that he owed over Rs 11,000 crore to the tax authorities at one time.

After chatting with us till almost 7.30-8 pm, he offered to drop us back to our office. We travelled in his car. Was it the famous Lexus? I don’t remember, but it was quite an impressive one.

After he left, Krishna and me wondered about his source of income. (Remember, this was the time when his bank accounts had been frozen) But nothing suggested he was short of cash.

Three years later, Sebi banned Mehta from trading (yes, he had actually been given the trading licence back, even after the 1992 scam). Also, the three companies, whose shares were shored up by Mehta’s cartel, were banned from tapping the market for a few years.

Mehta died on 31 December, 2001.

A few weeks back (and 17 long years), when Mehta’s famous Worli house (Madhuli) attracted a mere Rs 20 crore, I was a bit surprised. His brother Ashwin urged the court to grant an extension as the price was too little for 8 flats.

After a week, there was another offer of slightly over Rs 32 crore – a whopping 60 per cent rise in just seven days. Despite this rise, the value was way below the going rate in the market.

For a man, who had spent most of his life shoring up share prices to unrealistic levels, the irony couldn’t be more obvious.

Stealing, openly

Thursday, February 26th, 2009 February 26th, 2009 Shyamal MajumdarShyamal Majumdar

I haven’t watched Slumdog Millionaire as yet, but it’s got little to do with the growing feeling that the movie represents nothing but poverty porn. I must be in a hopeless minority as every other person you meet these days seems to have seen the film many times and is eager to give you a scene-by-scene description of the fairy tale that shows how the film’s young protagonist, Jamal, overcomes long odds to live happily ever after.
Courtesy the Slumdog watchers, I also know how in one of the early scenes, Jamal dives into a raw sewage under the outhouse where he is trapped, to get a movie star’s autograph.

It’s almost like those gold old Sholay days – everyone seemed to know the number of glass pieces that pierced Hema Malini’s feet when she was swaying to the song `main nachungi’.

The difference is Sholay had a dream run in movie halls for over five years, while Slumdog ran out of steam barely a week after its release. If so many Indians have watched the movie, why were multiplex owners complaining about unsold tickets even in the first weekend after the film’s commercial release in India? The truth is for all the attention in Hollywood, Slumdog has failed to set the box office alight in India.
The reason is quite obvious: Slumdog must be one of the most counterfeited movies of all times. You can see them everywhere: hooky CDs and DVDs of the movie are openly on sale for Rs 40-50 with a little bartering, prompting US-India Business Council President Ron Somers to say, “Imagine how many Slumdogs could be conceived, produced and premiered if only there were greater efforts to crack down on film piracy.
In fact, a study commissioned by USIBC as part of its Bollywood-Hollywood Initiative, found that India’s entertainment and media industry loses some 820,000 jobs and about Rs 20,000 crore to piracy each year.
It’s true that the grey market that had once decimated the music industry has always been there. But they were sold on the sly earlier; the veil seems to have been taken off now. I suspect no law can prevent this as no law can change people’s minds. If rich and educated people lecturing the world against piracy etc don’t mind enjoying the knock-off versions of the film, the law cannot be anything but a mute spectator. Somers, meanwhile, can keep on pleading.
Just the other day, a friend was recounting – quite gleefully – how he saved Rs 1,120 (the price of four multiplex tickets on a Sunday) by downloading the film from his relative’s pen drive. Isn’t this encouraging piracy?  India’s high & mighty and beautiful people couldn’t care less, it seems.    

How are FIIs’ flows captured?

Tuesday, February 24th, 2009 February 24th, 2009 BG ShirsatBG Shirsat

Foreign institutional investments in Indian companies through primary and secondary markets doesn’t appear to be an accurate benchmark of the real FII inflows/outflows in Indian equities. Securities and Exchange Board of India’s (Sebi) daily trend in FII investments captures all activities undertaken by FIIs in the Indian securities market, including trades done in secondary market, primary market and activities such as right/bonus issues, private placement, mergers and acquisitions etc.

This means Sebi’s FII data is the buying and selling of securities in the primary and secondary capital market, and not the money that comes in or leaves the country as assumed by media and investors. If FII inflows/outflows are buys/sells on equity markets, then there is possibility that net inflows/outflows on a given day could be just a book entry.

The Sebi data on FII investments is in rupee terms and dollar value is only conversion of rupee/dollar rate of the day. Does it mean that inflows/outflows into India and out of India are not available? I tried to get an answer from Sebi through an e-mail almost a month ago, but I haven’t got a reply yet.

When I enquired with RBI about net foreign currency data on FII activities in Indian equity markets (primary and secondary markets, not FDI), RBI said FII inflows/outflows data is source from Sebi. However, as per Sebi’s definition, the FII data is just buy/sell on equity markets and not real flows.

Also, FIIs have been trading heavily in futures and options with their open interest positions varying 35-45 per cent. So they must be making or losing money on their trading in F&O. Where are these inflows and outflows accounted?

Is it that the profit made in the F&O segment gets diverted to buy shares in the secondary markets or shares from primary markets? Even their investment in preferential offers and qualified institutional placement (QIP) issues appears to be purchases through the Indian money recycled. For last one year, FIIs were net sellers on the cash as well as the F&O segment, indicating huge outflows. But nowhere this is getting reflected in term of outflows in foreign currency.

So, my gut feeling is that FIIs’ inflows/outflows may be very little in the last three years and most of the money they have made in F&O markets has been recycled in the cash market. The foreign fund data sourced from EPFR (Emerging Portfolio Fund Research) shows that India dedicated funds have seen outflow of $2 billion in 2008, and though it is not strictly comparable, Sebi’s outflow of $13 billion is still substantially lower.

Dip dip dip…

Saturday, February 21st, 2009 February 21st, 2009 Priyanka JoshiPriyanka Joshi


We cannot imagine a day without our phones, right? We have observed that there is whole lot of mayhem when you drop your mobile (or better termed as your life line) into water. (Guess, it’s no big secret that we all take our phones to wash rooms, during work hours at least).  So, here are some useful tricks to help you bring back a ‘wet’ mobile phone to normalcy.

It works…I dropped a Nokia N81 in a water tub to prove my point (I know I’m mad). And it is in working condition as I write this post.

Disclaimer: Please don’t perform these stunts by your own unless you have a spare phone or a genuine wet phone. (more…)

Ours really is a water tight apartment

Friday, February 20th, 2009 February 20th, 2009 Abhilasha OjhaAbhilasha Ojha

“Bharat mein doodh kee nadiyan behtee hain (In India, milk gushes forth like streams)” This is the sort of stuff one read in schoolbooks, watched in Manoj Kumar’s films and I think I may have even sung some sort of anthem in school’s morning assembly sessions. Anyway, what I studied and watched and sang as a kid is what I believe — finally — today as an adult.

Oh yes, India is the land where milk is in abundance – I only buy tetra-pack stuff and even keep milk powder just in case my pet dog — or I — have midnight cravings for it. India is also the land where you’ll find the right stuff to mix in the milk too. No, not just coffee, there’ll be Maltova, Bournvita, Boost, Horlicks - for kids, growing kids and women too - besides others. Then there’s hot chocolate, cold coffee, ice-cream, dahi, probiotic milk, there’s everything.

Now, logically, I wish, I’d learnt that India was also the land where simple H20 too gushed from the zillions of streams. In Delhi’s Saket area, where I’ve been residing for the past one-and-a-half years, you’ll find everything, milk (okay, fine, I’m saying it the last time), Bisleri bottles (in 1- 2- 5- and 20-litre bottles respectively), Baskin Robbins, Häagen-Dazs, gelatos and what have you. And there’ll be healthy juices served at your doorstep from the neighbourhood grocery store.

But, but, but… there’s no water here. At least in the area where we live (where “kothis” cost over Rs 1 crore easily) there’s never any water. Ever.

Our area’s “water slot” is from 3-5 am and 3-5 pm respectively. Since we’re a working couple, the question of filling water (except on Sundays when there’s usually no electricity) in the afternoon doesn’t arise so what do we do? Wake up every other day and start our day at 4 am, fill water for an hour and then try and catch up on our sleep. I hate it and never before have I had this urge to turn housewife, just for the sake of ensuring there’s enough water in the house to last at least a week.

The domestic staff is already calling us a mad, water-obsessed couple. I’m beginning to see why I hate all those serials and films where the hero looks forlorn into the mirror while the water from the tap fills up the sink. (Mr Ramadoss, forget smoking, someone should ban this). I feel like putting buckets of water when rain sequences are shown on TV. I don’t feel like swimming in the Sports Complex pool (actually,I don’t know how to swim), instead, I want to bring buckets and fill water for my home. I get excited when I see coloured buckets, drums in shops and even dreamt some days ago that I was filling my semi-automatic washing machine with water. Oh, and I hate the growing pile of dirty clothes but there’s precious little that one can do, not when there isn’t enough water. I feel nervous inviting guests over, wondering how many times they’ll go to freshen up, how many times they would need to wash their hands, how often will their children beg to “please, can we splash water in the sink aunty”.

Yes, in my life, I plan - no, not the menu - for parties (if there are any) just how much water needs to be there when guests arrive. My home is a growing chaos of baltis and drums and chilumchees but then that’s too bad. Taking showers is a strict no-no. We only take baths with the good ‘ol balti – (not more than 10 magaas; that’s my count). Even when I need to check if water is flowing in the taps, I make sure to collect it in a mug and transfer it to another bucket. Shekhar Kapur wanted to make a film on the water crisis, I’d heard. Maybe he could pay my humble home a visit and start his research.

Oh, by the way, did I tell anyone that I’m now used to washing my face with mineral water?


Look, the pigs are flying!

Friday, February 20th, 2009 February 20th, 2009 Bijoy Kumar YBijoy Kumar Y

The colour of my blood is green. I live in a rainbow.  My pet is an Anaconda. I am married to a cloned sheep. Porsche has launched a diesel car.
It is sad, but the last bit is true. Come March, Porsche, will take the covers off the diesel Cayenne – the first ever car from the stupendously successful sports car maker from Stuttgart to ruin its internal combustion innards with messy truck fuel.
Nothing, dear reader, is sacrosanct now. One should have guessed the way diesel motors were progressing – with common-rail fuel feed systems, enough torque to spin earth the other way around, enough mileage to mock bicycles and more green cred than Greenpeace means diesel fuel has arrived in life. But they could have spared Porsche.
May be they needn’t, and we should’ve been mentally ready for diesel Porsches and now be ready for even scarier stuff like diesel Lamborghinis and Ferraris after the phenomenal success Audi has had at 24 Hours of Le Mans with diesel power.
The 240 bhp V6 that goes under the bonnet (borrowed from VW?) can’t even take the massive Cayenne mother ship to 250 kph and it takes a rather shameful 8.3 seconds to do a 100 kph run (shameful in Porsche terms) but the press release talks about more important stuff, like fuel efficiency. How about 10.7 kpl from a Porsche? If not by that figure, you will be impressed when you know that you can drive 1000 km on a full tank of the smelly fuel. Welcome to the real world, where the world likes to have SUVs and even the super SUVs have no option to run on diesel.
Yeah I am looking out of my window and I can really see pigs flying.

Death of an executive

Wednesday, February 18th, 2009 February 18th, 2009 Bhupesh BhandariBhupesh Bhandari

Neelkanth Ratnakar Dongre died last week. He was 64. No obituaries were written. Except for friends and family, nobody seems to have taken notice. But those who have followed the capital’s corporate scene closely will tell you that his life was an extraordinary journey of ups and downs. 

He started out in the 1960s at DCM – it was called Delhi Cloth Mills at that time and was a great training ground for executives. Quickly, he entered the good books of Lala Charat Ram, the youngest son of Lala Shri Ram. In the 1970s, when one of his factories in Kolkata as besieged by agitating workers, Dongre loaded all the papers in a truck, smashed a wall to make way and drove the truck all the way to Delhi. 

At his home in an up-market South Delhi neighborhood, Dongre kept a room full of medals and trophies he had won when he was young. I never like to lose, he would often say. 

Lala Charat Ram too relied explicitly on him. On overseas trips, Lala Charat Ram would quietly upgrade Dongre’s hotel room. So much so, he gave all powers in the group after it split in the late-1980s to Dongre and not to his two sons, Deepak and Sidhharth. Together, they formed what came to be known as the Charat Ram-Dongre group. The two were together in a number of businesses – hotels, real estate, automobile components, trading, furniture etc. 

In his autobiography, Lala Charat Ram sang fulsome praises of Dongre and had only harsh words to spare for his sons. It was an open secret that Dongre had become the bone of contention between the Lala Charat Ram and his sons. They saw him as a usurper who was trying to take what was rightfully theirs. 

Then things took another turn in the late-1990s. Charat Ram and his sons made up and Dongre overnight became a liability. After a bitter boardroom battle, he was evicted from most of the companies and consigned to the margins. The inevitable had happened – blood runs thicker than anything else. Lala Charat Ram died some time back. Now, Dongre too is gone. But the uncomfortable question remains: Can an executive ever replace family? 

Private scams

Tuesday, February 17th, 2009 February 17th, 2009 Bhupesh BhandariBhupesh Bhandari

Ever since the Satyam scandal broke out in early January, unsuspecting Indians have once again got to see the seamier side of India Inc. This is a big blow to Indian businessmen. Otherwise, they were role models for the youth. They bought assets all over the world, hobnobbed with global decision makers, rode in fancy cars and created wealth for all. They were unstoppable. 

The halo around them was akin to the one that surrounded our armed forces till late when the rot in defence deals got exposed. Even before that, leakage from the Canteen Stores Department to the market place was a well-oiled operation. But it was never talked about. 

Corruption in the armed forces could be the subject for another piece. What concerns us here is the rampant corruption in the private sector. It has been institutionalized so well that most of us never even get to know of it. Kickbacks on orders, commissions on contracts – it is all an accepted part of the country’s corporate culture. 

In good old days, the owner of a company would more often that not keep the “purchase” function with himself or a family aide. Why? Your guess is as good as mine. All household expense, extended foreign junkets were all billed to the company. Family members were placed at sensitive positions. 

Before it was dismantled in 1991 by the PV Narasimha Rao-Manmohan Singh combine, the” licence, permit and quota” Raj gave Indian businessmen a unique set of skills – environment management. A businessman was known best for the bureaucrats and ministers in his pocket than his business acumen. Business houses which claimed licences and sat on them to create shortages were exposed a number of times. 

Liberalization came to us 18 years ago, but nothing has changed. Satyam has shown us that. The all-powerful promoter can do what he likes. 

At the executive level too, things are equally bad. For instance, money often changes hands when advertising accounts are given out. If there is any laxity, crores are siphoned off in no time. 

Forensic experts will tell you that there is a deluge of cases involving senior-management fraud these days. Most of these revolve round cooking the company’s books. As their bonuses are linked to the company’s financial performance, they have been found to park expenses in subsidiaries, move stocks to the dealers, book fictitious income etc. 

I’m making a movie

Monday, February 16th, 2009 February 16th, 2009 Abhilasha OjhaAbhilasha Ojha

Director Anurag Kashyap walked up to director/actor/anchor/rock singer Farhan Akhtar and said, “Your sister has outshone you. She’s had a fabulous debut with Luck By Chance. She’s number one, you’re number two.” Farhan replies: “Yes, we decided to keep it in the family.”

I saw Luck By Chance and Dev.D recently and couldn’t stop wondering as to how incredible 2009 will be for “indie” films. I met an ad professional in Delhi’s messy Nehru Place and guess what, he was a producer too (for a Rs 5 crore film Jugaad. The film was destined to flop, it didn’t look right but the producer insisted that he had looked into the logistics and that he would recover the amount. But more importantly, he said, he wanted to tell a story (the film tells his own story, the producer had said to me). “It couldn’t have been possible in any other era. It’s only now that even I can thump my chest proudly and say, ‘Yeah, I’ve made this film.’” And he gives me glowing examples of many others like him; an IIT graduate, a mass communication instructor, a graduate, an LA-based software engineer; all individuals who want to produce or direct films. Forget, for a moment, the fate of these films at the BO. Isn’t it simply fascinating that we are living in an era where people like you and I can actually dream of writing scripts, directing and even funding movies? Why, I find it doable to actually sit with a bunch of like-minded friends for a get-together, work on an engaging script and chip in to even fund a film. What’s more, in today’s day and age, it just might work and who knows, we could even break even.

No wonder then that the “Indie” fest in India is a mini-industry in itself. You’ll have Abhay Deol working on films that he believes in, you’ll have Farhan Akhtar acting in films despite the fact that he doesn’t have the face of a “conventional” good-looking hero (if you know what I mean). Then there’ll be directors like Anurag Kashyap, Dibakar Banerjee, Neeraj Pandey, Sriram Raghavan who’ll make films that are closest to their hearts, scripts that appeal to them. Talk to the makers of this kind of cinema and they’ll tell you that it’s way to early for the “indie” movement to take off (Deol even said that our industry is now at a stage where Hollywood was in the 70s). But most of them are happy that they’re experiencing celluloid at their own pace, in their own style. 

And to feel the charm of the celluloid spill over to individuals like you and me is even more fascinating. So if there’s a story in your head, take it seriously and translate it into a visual delight. Who knows, you could be toasting it in the next film festival in LA!

The sultan of sink

Monday, February 9th, 2009 February 9th, 2009 Rrishi Raote

Without a firm principle of primogeniture, Delhi sultans weren’t very good at establishing dynasties. And many did not last long. Knowing this, one wise sultan took no chances: he kept his son and heir away from the court, made sure the boy was educated well under the supervision of a respected maulvi, and that he did not develop any of the usual bad habits. Then, this conscientious father died. His son became the sultan, instantly forgot his studies, fell greedily into all the vices from which he had been separated, and in short order found himself sick and paralysed by syphilis. Eventually, a usurper took courage, entered the royal chamber, rolled the helpless young man up in his rug, and tossed him out of the window into the river below.