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Saturday, August 7, 2010

Others fly aircraft; he sells them!

The largest-selling business jet in the world is sold by him. Still, Nigel Harwood-led InterGlobe General Aviation has had a modest two years in the past. B&E takes a running interview of Nigel to get the dope on flying by Steven Philip Warner

Even competitive pressures are rising for Harwood, with many international players like Boeing, Cessna, Falcon having eyed the Indian business jet market for long now. Harwood is hopeful, “Hawker Beechcraft, which currently holds a global market share of 60% has had a very long and successful history in India. Furthermore, with our latest additions to the product line (Sikorsky Aircraft Corporation, Dornier Seaplane Company and Pacific Aerospace) we see huge potential for growth.”

Despite his well-practised optimism, there are some challenges that he cannot ignore though, such as an import duty on your aircraft which currently stands at 17%. The lack of infrastructure is another worry at present but with the ongoing modernisation projects (apart from 35 airports in smaller locations) and other greenfield projects, this challenge may be sorted out in time. There is a third problem that has plagued the commercial and business aviation players for a long time and that is financing. While players in the commercial circuit have accumulated Rs.340 billion in losses over the past five years, thereby forcing the creditors to shy for the near future, in the recent two years, the lack of financing has hit buyers’ hopes in the business aviation space. A Sydney-based aviation analyst outlines two other challenges to B&E: “Skills shortages and lack of flexibility for private travel in terms of need for advanced regulatory clearances.”

Irrespective of however positive Harwood apparently is, the fact is that downturn has been a dry run. Business aviation is all about internal funding, which came only in trickles during the slowdown. Imagine this – out of the 88 non-scheduled operator certificate holders, as on November 30 2008, only 30 were operational. The past couple of years have not been the easiest for InterGlobe General Aviation either. Harwood accepts, “It hasn’t been an easy ride for us during the slowdown as purchase decisions got deferred, but we kept working on the relationships, knowing a time would come when they would buy again. IGGA investors have been keen to see better results.”

“That was a time when I had to make important decisions. When I called up my MD (Rahul Bhatia, MD of InterGlobe Enterprises) and asked for his advice, he told me that as CEO, it was my call to make. He just hoped that I would make more right decisions than wrong,” recalls Harwood. At the same time, there are positive signs too – for example, in April 2010, the company managed to sell seven aircraft – a start to earn it a “billion dollar corporation” tag this financial year.

Diversification is one strategy that IGGA will attempt over the next few months, though the company plans to stay unlisted – a good bet, considering how publicly-listed entities in commercial aviation have given their shareholders bedsores. John of Frost & Sulllivan has another advice: “The Air Taxi model in business aviation is a proven success in North America & Europe. InterGlobe could look at them (within India) as an investment option, due to the low initial investment and minimal operating cost,” says Harwood.

Back in Preston, Harwood’s grandfather was a farmer, who had a passion for making wooden furniture & shoes. “What I learnt from him as a child was ‘attention to detail’, which is much needed in the business I am in,” says Harwood. One guesses he’ll require much more than that to succeed – a fair amount of luck...

Steven Philip Warner

For more articles, Click on IIPM Article.

Source : IIPM Editorial, 2010.

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.
“We will change your outlook” - The Sunday Indian on B-SCHOOL RANKING SCAMSTERS EXPOSED! A must read...
The Sunday Indian:-
B-SCHOOL RANKING SCAMSTERS EXPOSED!
For Exclusive Footage by Sunday Indian Click Here

Outlook Magazine's B School Ranking Scam Exposed
Business Standard Exposes the Outlook Magazine Money Editor
Don't trust the Indian Media!

IIPM enters into media education
IIPM makes record 10,000 placements in five years
TSI exposes b school ranking scamsters Mahesh Peri of Career 360 and Premchand Palety of C fore. - For Complete Sting Operation Video Click Here
Pioneer Exposes the fraud called Mahesh Sharma and Mahesh Peri of Career 360 and Barbel Schwertfeger of mba-channel.com
IIPM: An intriguing story of growth and envy
Prof Arindam Chaudhuri of IIPM on MF HUSAIN‎

Friday, August 6, 2010

Open the Ex files!

Innumerable marketers are selling ‘happiness for tomorrow’ but ‘love market’ offers memories of the past...

If one defines the term ‘market’ in its simplest form, it would be called an arrangement where goods or services can be exchanged by people. But the intent of the content in this article isn’t to describe the terms in economics’ glossary or the forces affecting them, but to talk about the business of love. In fact, what would be better than to begin with the ‘Love Market’ of Vietnam that is held on every lunar March 27 that falls sometime in May? Called the Khau Vai Love Market, the market is about 100 years old among different ethnic tribes such as the Dao, H’mong and Tai in the northern mountainous region of Vietnam. However, the popular ‘form of love’ sought in this market isn’t the ‘new love’ but the ‘old flames’ doused by circumstances or recklessly quashed by kinfolk. Legends tell the tale of a boy and a girl from two different tribes who fell in love with each other but were not able to marry due to the differences between the tribes. To avoid bloodshed and maintain peace, the two decided to part ways but meet every year on that day, March 27th of the lunar calendar. The place where they used to meet was Khau Vai, which today has become the love market festival centre for former lovers and it features food and drinks, musical performances and even folk games. In fact, the tradition has gladly turned out in a way that both husband and wife together leave to look for their respective former lovers. In case only one spouse wants to visit the market, she can do so without feeling guilty while the other one stays at home without feeling jealous!

While the online dating business, which is worth a billion dollars per annum (competing with pornography), gives the opportunity to seek new love every day, the world is divided into two factions when it comes to concluding if ex-lovers should be good friends. “If I pass by my ex-lovers, I would definitely be courteous to stop by and talk. But, I don’t understand the relevance of giving out a day or going to the extent of making friends with people who have deliberately been made a thing of the past. I would rather focus on making the present relationship better,” says 28-year-old Jaikaran Oberoi, who has been through a series of flings as well as serious relationships.

The nature of love differs across cultures and as scholar William Jankowiak observed, “Romantic passion is a byproduct of an interplay between biology, self, and society”. In a study to learn about the differences in Love across Cultures (LAS), it was discovered that the ‘Chinese participants were more endorsing of yuan (fated and predestined love) and the Russians were less likely to require love as a basis for marriage. While the Japanese agreed less with certain romantic beliefs, the Americans were more endorsing of secure attachments.’

However, no culture except the Vietnamese seems to have made place for the lovers who due to various reasons cannot be with each other. Though, the openness in marital relationships to admire the ‘old flames’ is admirable here, assigning a full-fledged ‘love market’ to the cause only hints at the society’s rules and conditions to temper down love in the very first place!

Swati Hora

Thursday, August 5, 2010

ONE YEAR AFTER LTTE

One year after the Tigers were silenced, the victorious Mahinda Rajapakse is stronger than ever. But as the Tamil Diaspora nurtures the dream of a Tamil Eelam, N. Asokan finds that only a meaningful political solution can bring permanent peace

Bhagwan Singh, Consulting Editor of Deccan Chronicle who has covered the Eelam War extensively, elaborated on the rising Chinese influence in Sri Lanka. He declared that India has lost Sri Lanka to China. “With the Tamil struggle now over, Colombo no longer needs India,” he said.

“Young Tamil students have abandoned their studies. A mechanism needs to be created for them to get back to studies there. There is a need for polytechnics and vocational training centres to help them to find jobs,” Bhagwan Singh stressed, calling for a civil society initiative.

While the war-affected Tamils’ plight remains a worrisome issue, the increasing influence of China in Sri Lanka in the last one year has woken up many experts. V.Suryanarayan, senior research fellow with Centre for Asian studies based in Chennai, in one of his recent articles, mentions a few projects in Lanka where the Chinese are involved: “China’s assistance to specific projects includes the $1 billion development of Hambantota port in southern Lanka. In the first stage, China will construct a 1000-metre jetty. Hambantota will serve as a safe haven for bunkering and refueling. Eighty five per cent of the estimated expenditure will be given by China at a concessional rate of interest; the balance will be contributed by Colombo.

It may be recalled that initially Sri Lanka had approached India for assistance in development of Hambantota but New Delhi dragged its feet. China is also assisting Sri Lanka in the construction of the following: an international airport at Maththala in Hambantota district, at a cost of $ 190 million. China has also offered its assistance in construction of a Colombo-Katunayake Expressway, improvement of the existing railway network, a coal power plant in Norochcholai, flood protection system for the suburbs of Colombo, a national theatre for performing arts in Colombo and a special economic zone in Mirigama meant for investment by Chinese businessmen. It must be pointed out that 50 per cent of the funding received by Sri Lanka since Mahinda Rajapakshe became the president has come from China.” He concludes that “The high profile policy pursued by China in India’s neighbourhood will have profound consequences for India.”

Meanwhile, the influential Sri Lankan Tamil Diaspora, which financially supported LTTE, is now trying to launch a new unarmed, democratic struggle for a Tamil Eelam. It is stitching together a Transnational Government of Tamil Eelam (TGTE) by conducting elections to elect representatives across the countries. After forming the government in exile, they plan to get recognition of the international community. “An internationally elected government to respond to an internationally abetted genocide and deprivation of sovereignty of a nation” is the spirit behind the polls, the Diaspora claims. Last Sunday, representatives were elected.

Wednesday, August 4, 2010

‘Smart’phones or just a ‘dumb’ call?

Michael Dell is betting big on smartphones to make up for the lack of any ‘killer app’. Is this a two-years-too-late strategy? by Neha Saraiya

From a strategic perspective however, this diversification of Dell isn’t an option, it is a necessity as the world heads faster towards convergence. Even the once-famed semiconductor wars that were once rumoured to remain in the PC domain at large, is being increasingly fought on mobility devices. Dell needs a new revenue generator, especially after its server business is likely to sink faster than imagined before, in the face of higher competition (the latest being Cisco’s entry into the server business with its next-gen Unified Computing System). Michael Dell may have found his revival kid. But the search wasn’t easy; he’s had his own share of initial jitters. Earlier, the company had planned to launch its first smartphone in February 2009. But amidst low economic activity and disinterest on the part of the prospective carriers for the prototypes thereof, Dell had to adjourn its plans. But it’s a new revival plan from Dell, and markets like China, India & Brazil will certainly play a big role. The company recently signed a pact with China Mobile, which has a subscriber base of 500 million and has a strong network of retail outlets. Dell has also signed a deal with service provider Claro, which covers over 2000 cities in Brazil nationwide.

There are however two challenges ahead of Dell. First is its weak distribution network, as industry sources confirm, “The company’s support system of minuscule count of vendors will only lead to a bad memory for the company in the long run.” Second, Intel (which is scouting for vendors to source its latest Medfield and Moorestown chips in smart phones) is reportedly in the final stages of talks with Nokia, to team up for smart phones to be launched by the end of 2011, which again is some blow to Dell’s ambitious plan to join hands with the largest chipmaker in the world. With the financial performance of Dell falling constantly since 2007 – significantly due to the economic slowdown – Dell might still make it through to better times simply because of the upswing. But for whatever it is worth, Michael has to take more such gambles on ‘killer apps’... sooner than later!

Neha Saraiya

Tuesday, August 3, 2010

Fiends on the prowl

A TSI sting operation finds how paedophilia has turned into a thriving business in Delhi, NCR and Mumbai. Taking advantage of kids’ poverty and craze for brands and gadgets, middlemen get rich by supplying minor boys and girls to satiate the desire of sick, rich men, many of them NRIs and foreigners. By Abhishek Kumar and Neeraj Rajput

We found it very easy to find these pimps in Goa because they contacted us. We were approached right on the beach when someone asked us, “Do you want something for tonight.” When we told them what we were looking for, they quickly took us to a corner and told us we had to book these kids a week in advance. They have a code word here for these kids – ‘Silkypack’. But we could not shoot there or talk to any kid as they wanted Rs 10,000 for booking and letting us talk to the kids on the telephone. One pimp also told us that during high season, foreigners booked these kids before they reached Goa and transferred the money into their accounts.

More and more minor boys and girls are falling prey to child prostitution rackets. What is required is stringent action on part of law enforcement agencies as well as harsh conviction of the guilty.

What is paedophilia?

Professor Rajesh Sagar
All India Institute of Medical Science

Paedophilia is a way to satisfy sexual urge by indulging in sexual relations with children and is a sick disorder. This has enormous adverse effect on the psyche and health of the victim (read sodomised kid). These children go into partial or complete depression. On the other hand, the culprit or the paedophile does not accept the fact that he is suffering from a disease and continues to prowl around places where kids are accessible. Since he does not think he is diseased, he does not come for consultations. Another problem is the children who are victimised try to conceal it for various reasons. Gradually, they too start suffering from psychiatric problems. There are a few symptoms that one must look out for, such as keeping unusually quiet, uninformed and prolonged absence from home, frightened demeanor and insomnia. If such symptoms appear, parents must contact psychiatrists.

Monday, August 2, 2010

Time to revisit the basket & egg theory

After a long lull, one can finally see some action at Walmart’s India headquarter. But that action seems pretty lackadaisical by Walmart’s standards... Is everything alright? by Savreen Gadhoke

And unlike the purchase culture in developed nations (where purchasers do not mind driving to a Walmart located out of town), in India Bharti-Walmart would have to take up real estate closer to city if not within the city itself, as buyers in India do not prefer going way out of their city/town simply to purchase wholesale goods. That itself will demolish cost efficiency calculations due to real estate costs. “Considering the requirement of 50,000-100,000 sq. ft. to open new stores, it will be difficult to obtain land in and around the major metros and there’s a possibility that Bharti Walmart may settle in for Tier II cities to set up stores,” says Vivek Mittal, CEO, Realty Stocks to B&E.

Though it’s not going to be easy for Bharti Walmart to replicate its facilities like direct-from-farm sourcing in other parts of the country, it’s becoming evident that even in the two-shop model, Walmart’s strategy of having good supply chains, warehouses, offering customised products according to the localised and cultural needs of consumers at low cost has given it an edge over its competitors. One can’t blindly ignore the fact that the retailer has wide experience of nearly 14 years of successfully operating in another emerging Asian economies like China.

And India, to its worse credit, brings it with its own share of problems related to politicking, lobbying, rent-seeking, and the legacies of licence raj. It was not that distant in history when Mayawati, the Uttar Pradesh CM, ordered the closure of all retail stores of Reliance Fresh and Spencers due to their sudden growth. Given that, a slow start is better than a devastated start anyday!

Savreen Gadhoke

Saturday, July 31, 2010

Living on her terms!

While Jennifer Aniston’s latest film The Bounty Hunter has left critics and audience ‘underwhelmed’, she’s already busy shooting for her next romantic comedy opposite Adam Sandler – Just Go With It. She is also launching a perfume – Lolavie – this summer, which is a fragrance that matches both her taste and choice and is “sexy and clean, floral, but not too flowery”. What’s more, ‘Rachel Green’ of the Friends series also believes directing is the next step for her and is already working on a project! This 41-year-old is sure going full throttle!

Friday, July 30, 2010

Turning the heat on its head

An early summer and an inspiring growth last year have encouraged consumer durable players to plan aggressive volume expansions. B&E takes a look at the ‘cool’ factors that will enable them to beat the heat by Neha Saraiya

Two Pronged Strategy

Anand Ramanathan
Manager, KPMG Advisory Services

This summer season will actually make a difference for the consumer durable industry and the players have already conveyed this to the consumers. Interestingly the platform for this year is health, as this is one area where we will see a top line action. The bottom line action has already taken place with the IPL and will further escalate to festivals like Baisakhi in north and New Year in the south (Tamil Nadu and Kerala). Thus going forward, this quarter (April - June) will witness a 30-35% growth in the consumer durable players. Last year, the majority growth was in the last two quarters of the year and that too because the economy was in a revival mode. However this year, pricing will be a crucial factor as it will be directly linked to the volumes. Given the kind of boom which is ongoing currently, I expect that the prices of the players in the market shall be quite competitive. Now when it comes to volumes, Indian players will have a disadvantage over the Korean and Chinese players and there will be more pressure on their volumes during the end of the season. This gap can only be bridged by adopting a two pronged strategy. First the Indian companies have to develop a strong line up of products, as a majority of the innovation that exists in the market is led by the Korean players. But on the other hand, the Indian companies have strength in terms of local presence and efficacy, which they need to develop. However, with favourable consumer demographics and long-term growth projections in services and industry, the consumer durables industry in India is set for sustained growth over the long term.

Neha Saraiya

For more articles, Click on IIPM Article.

Source : IIPM Editorial, 2010.

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.
“We will change your outlook” - The Sunday Indian on B-SCHOOL RANKING SCAMSTERS EXPOSED! A must read...
The Sunday Indian:-
B-SCHOOL RANKING SCAMSTERS EXPOSED!
For Exclusive Footage by Sunday Indian Click Here

Outlook Magazine's B School Ranking Scam Exposed
Business Standard Exposes the Outlook Magazine Money Editor
Don't trust the Indian Media!

IIPM enters into media education
IIPM makes record 10,000 placements in five years
TSI exposes b school ranking scamsters Mahesh Peri of Career 360 and Premchand Palety of C fore. - For Complete Sting Operation Video Click Here
Pioneer Exposes the fraud called Mahesh Sharma and Mahesh Peri of Career 360 and Barbel Schwertfeger of mba-channel.com
IIPM: An intriguing story of growth and envy
Prof Arindam Chaudhuri of IIPM on MF HUSAIN‎

Thursday, July 29, 2010

Marketing mantras

Hrithik Roshan is busy promoting his home production Kites, and everyone is going ga ga about how hot this blue-eyed boy is looking and the smouldering chemistry he shares with his co-star Barbara Mori. Hrithik though feels that he needs marketing lessons from Shahrukh Khan and Aamir Khan! But considering all the hype around his co-star Mori to the edited 90-minute version of the film in English, Hrithik we bet, is just trying to being modest!

Monday, July 26, 2010

Disinvestment dilemma

However well-intentioned the government’s disinvestment policy may be, the results till date haven’t met expectations.

If it is to meet its disinvestment target for the sixth time in 19 years, the government must be pragmatic on its valuations and take retail investors along instead of merely depending on (foreign) institutional investors.
Chances are that you have never heard of Hooghly Dock & Port Engineers or even Hospital Services Consultancy Corp. Neither of them has ever made an overseas acquisition or made it to the Fortune 500 list. Nevertheless, they are but two of the stars in a list of public sector enterprises (PSEs) recommended by the Disinvestment Committee in which a proposed partial sale of shares can help the government realise its ambitious target of raising Rs. 400 billion in FY 2010-11. Over the years, the size of public sector has increased dramatically and currently there are 473 central PSEs, out of these 104 are listed and 369 are unlisted, while at the state level, there are about 1,160 state PSEs. Quiet interestingly, the valuations of these central PSEs on P/E (Price to Earning) basis for the listed companies and P/B (Price to Book) basis for unlisted companies is pegged at $450-500 billion (approximately 40-45% of the nation’s GDP) while the net profits of these central PSUs work out to be a meager 2.2% of their total assets. Calling for people’s participation in the disinvestment programme, the finance minister, Pranab Mukherjee, in his budget speech said, “The public sector undertakings are the wealth of the nation, and part of this wealth should rest in the hands of the people. While retaining at least 51% government equity in our enterprises, I propose to encourage people’s participation in our disinvestment programme.”

There is little doubt that most of the PSUs being put on the block for disinvestment are fundamentally strong and account for the largest market share in the domain of their operation. Yet, why is it that retail investors are wary of putting their hard earned money in these companies? Isn’t it ironical that Life Insurance Corporation (LIC), India’s largest insurance company, had to bail out the NMDC FPO on the last day, subscribing to 75-80% of the issue at Rs.300 per share putting in nearly Rs.75-80 billon, or for that matter the government had to cut a sorry figure having had to bailout the Rs. 82.86 billion NTPC follow-on-issue asking State bank of India and LIC to write out cheques of Rs.40 billion or more?

Given such a scenario, a better way out for the government would be to simply enter into an off-market agreement with LIC and SBI to sell the shares. Why make the pretence of having a follow-on issue? Certainly, this is not the best way to begin the disinvestment process. The calendar year 2010 has seen 4 public issues from PSUs (NTPC FPO, REC FPO, NMDC FPO and United Bank of India IPO) raising an amount of Rs. 223 billion, but the lukewarm response that the issues received one after the other portrayed a grim picture. While it’s true that the government needs money to meet its disinvestment target, it cannot ask for valuations that are way beyond the fair value (one of the reasons cited for the poor performance of NMDC FPO). Isn’t the government over-stretching itself? On one hand, the deteriorating fiscal situation leaves the government with no option but to push ahead with its disinvestment plans. On the other, it is equally true that having burnt its fingers more than once, the government must reconsider its ‘blanket disinvestment’ philosophy and opt for a calibrated approach to meet capital needs.

For more articles, Click on IIPM Article.

Source : IIPM Editorial, 2010.

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.
“We will change your outlook” - The Sunday Indian on B-SCHOOL RANKING SCAMSTERS EXPOSED! A must read...
The Sunday Indian:-
B-SCHOOL RANKING SCAMSTERS EXPOSED!
For Exclusive Footage by Sunday Indian Click Here

Outlook Magazine's B School Ranking Scam Exposed
Business Standard Exposes the Outlook Magazine Money Editor
Don't trust the Indian Media!

IIPM enters into media education
IIPM makes record 10,000 placements in five years
TSI exposes b school ranking scamsters Mahesh Peri of Career 360 and Premchand Palety of C fore. - For Complete Sting Operation Video Click Here
Pioneer Exposes the fraud called Mahesh Sharma and Mahesh Peri of Career 360 and Barbel Schwertfeger of mba-channel.com
IIPM: An intriguing story of growth and envy
Prof Arindam Chaudhuri of IIPM on MF HUSAIN‎