Corporate Subterfuge: Idea Cellular

6.11.10

Like all Indian owned companies, Idea too controls a number of subsidiaries-some of the underlying mathematics of these inferior siblings makes no sense on the face of it. Take for example its 100% subsidiary Aditya Birla Telecom, a privately held company. Idea's equity investment in this subsidiary totes up to Rs 16.3 bn which works out to a purchase price of Rs 1633 per share of Rs 10 each face value. This would appear to be an expensive piece of acquisition and, Idea gets not a dime as dividend from this deadwood sibling. But let that be. The paid up capital of this subsidiary is shown as Rs 119 m, though Idea's investment in this subsidiary as per its books works out to only Rs 100 m at face value. But let that also be. Idea has very 'craftily' merged only the telecom operations of the subsidiary with it. The subsidiary is now left holding some nuggets, or so it appears. The subsidiary has zilch revenues but it has investments to the tune of Rs 73 bn - being investments other than investment in subsidiary. What exactly are these goofy humungous investments, and why do they not yield any returns please? Eureka, it also appears that these investments have come for free! The sibling boasts equally hefty reserves of Rs 73 bn. The exact nature of these reserves is not known, and it did not get merged with the parent for reasons best known to the parent. Why do managements resort to such abysmal subterfuges?

Or take the example of another subsidiary Idea Cellular Towers Infrastructure. Idea has invested Rs 0.5 m in the equity of this sibling and then transferred assets worth Rs 16 bn to it. It appears that this subsidiary has got these assets for free from the parent as the only corresponding entry on the liability side of the balance sheet is a figure of Rs 15.7 bn, shown under reserves. This is truly fantastic by any yardstick. It recorded a negative profit of Rs 332 m on a turnover of Rs 1.6 bn for the latest accounting year. How it managed to repay a loan of Rs 710 m advanced to it by the parent in the face of these dismal results is not known. One wonders what the figures are like for its joint venture, Indus Towers, to which it has advanced dollops of credit.

Courtesy: Equitymaster.com

Economics Gyaan

6.11.10

Debt. This four letter word is indeed sending shivers down the spine of economies across the world. And why wouldn't it? If used beyond reasonable proportions, debt has the capacity to seriously impair economic growth for years to come. And this is exactly what happened with most of the developed world. They took an overdose of it and are now suffering from its after effects. It seems India has also tried to take a lesson or two from this entire episode of excess leverage.

As per a leading daily, the Government is serious about a debt reduction strategy that would seek to improve upon the target already in place. If were to talk about numbers, then the Government is planning to lower the level of debt liabilities as a percentage of GDP to 43% by FY15. This is about 2% lower than the target already in place. If the target is indeed achieved, then it would ensure that interest rates stay lower, which in turn will boost both consumption as well as investment demand and ensure that economic growth comes in higher than normal. What more, this could also mean higher stock markets.

Courtesy: equitymaster.com

Wish List for Zee Saregama

6.11.10

One of the few programs I look forward to watching on TV is talent search Saregama. Over the years it has morphed from Sonu Nigam's hosting ( nothing has come close to it till now: not Udit Narayan, not Abhaas Joshi and definitely not Shaan ). The heart of the matter is talent and it is amazing how year after year, this amazing country of ours throws up such a rich repertoire.

We at home do not particularly care for Bishak Jyoti's tapori antics till he suddenly zapped us with his ghazal last week. Khurram's khafi was another discovery. It is indeed sad that he got eliminated within a week of his stellar performance. I sincerely hope Khurram and Ali Sher are not victims of parochialism. A couple of seasons back, Amanat Ali deserved more to win than the ultimate winner ( Oink something ), but that is the way the cookie crumbles.

The other day I chanced to listen to Mukesh's sajanwaa bairee ho gaye hamaar. These are lyrics meant to be sung by a female. For want of a soulful female voice, mebbe Mukesh was made to sing this song. I am looking forward to hear this in Sniti Mishra's voice. We hope this pint sized wonder really goes places!

Abhilaasha has already arrived. She should now move up from VOI/Zee Marathi/Zee Saregama before she picks up the realty show ''aunty" tag. Sugandhaa has done very well to be taken seriously as a singer and scrubbed away her comedienne persona. But one wishes she does not overdo the gareeb gai bit on stage.

Kamaal Khan is studio material and should give Sukhwinder ( shrillness personified ) a real run for his money. Ranjit Rajwaada should let be by the judges. As much as you cannot expect Mehdi saab to sing rap, this guy should not get ragged under the guise of versatility. Ditto with Sniti. We love her for what she is, and the way she is. Too much of mentoring, and we run the risk of another genreless Sunidhi Chavan.

Deepavali

5.11.2010

HAPPY DEEPAVALI Deepavali is a festival where people from all age groups participate. They give expression to their happiness by lighting earthen 'diyas' (lamps), decorating the houses, bursting firecrackers and inviting near and dear ones to their households for partaking in a sumptuous feast. The lighting of lamps is a way of paying obeisance to god for attainment of health, wealth, knowledge, peace, valor and fame. It is one time in the whole year that children volunteer to leave their beds long before the day begins. In fact, the traditional oil bath at 3 a.m, is the only chore that stands between them and the pre-dawn adventures. They emerge, scrubbed clean to get into their festive attire, and light up little oil lamps, candles and scented sticks(agarbathis), the wherewithal for setting alight crackers and sparklers. On Diwali night, little clay lamps are lit in Hindus homes, but now a days colored electric lamps are also used. What is the significance of lighting a lamp? There is a logical answer to this question. It is through the light that the beauty of this world is revealed or experienced. Most civilizations of the world recognize the importance of light as a gift of God. It has always been a symbol of whatever is positive in our world of experience. To Hindus, darkness represents ignorance, and light is a metaphor for knowledge. Therefore, lighting a lamp symbolizes the destruction, through knowledge, of all negative forces- wickedness, violence, lust, anger, envy, greed, bigotry, fear, injustice, oppression and suffering, etc. Competition is stiff, and even the little girl in silk frocks and their finery are watching out for the best sparklers and flowerpots, the rockets and Vishnuchakras, which light-up the night sky like a thousand stars. Grown-ups are the soul of generosity. Festive bonhomie abounds. Courtesy: Jay Mistry

Navratri

16.10.10

One of the biggest festivals in many parts of the country is the worship of Godesses in their many manifestations. These festivities are especially big in Gujarat and Bengal. Celebrations over nine days and nights culminate on the Dussehra day. Legend has it that on this day evil was conquered by good.

Ganapati Festival

16.10.10

India is primarily an agrarian society and hence most of its festivals ride piggyback on the agricultural cycle.The end of monsoon heralds the beginning of festivities. Among the first major Hindu festivals is Ganesh Chaturthi, where the elephant headed Hindu deity Ganesha is worshipped. On all auspicious occassions the blessings of this deity is invoked and worshipped first.

The Indian Thali

16.10.10

Among the blessings of being born an Indian is our food diversity. A typical Indian meal is vegan most of the time and quite a balanced diet. There is chapati ( flat rolled wheat bread ) or bhakri ( millet bread ), curries, lentil soup, rice, curds pickles and spicy pappadams.