And now we are all going bananas!

You know what really had me terrified on Nov. 7? The all-too-real possibility of a highly suspect result. What would we have done if the Republicans had held on to the House by a narrow margin, but circumstantial evidence strongly suggested that a combination of vote suppression and defective – or rigged – electronic voting machines made the difference?

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An IIPM And Management Guru Prof. Arindam Chaudhuri’s Initiative

BOOK EXTRACT

It is August 1854, and London is a city of scavengers. Just the names alone now read like some kind of exotic zoological catalogue: bonepickers, rag-gatherers, pure-fi nders, dredgermen, mud-larks, sewerhunters, dustmen, night-soil men, bunters, toshers, shoremen. These were the London underclasses, atleast a hundred thousand strong. So immense were their numbers that had the scavengers broken off and formed their own city, it would have been the fifth-largest in all of England.

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Source : IIPM Editorial, 2006

An IIPM and Management Guru Professor Arindam Chaudhuri's Initiative

Grandhi Mallikarjuna Rao (GMR)

Bottomline figures for GMR Industries (that controls the agro-business of GMR) are on a roll since financial year 2002-03 and they have grown by almost six times to Rs.345.23 million for the FY 2005-06 as against Rs.60.96 million in FY 2002-03. Also, the share prices of GMR Industries have catapulted from Rs.9.45 per share in January 2002 to Rs.358.90 per share by November 2006. With strong financial support and aggressive outlook towards airport infrastructure in India, the growth story of GMR group certainly seems to be long lasting.

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Times have changed and the whole business of political campaigning has changed too

It’s no more just long speeches that political candidates are using. They are doing much more to reach closer to the young generation. They now do phone polling, phone surveying and SMS text messaging to market their parties and themselves – things that the younger crowd finds cool and trendy.

Just as a brand needs to communicate the product benefits, the political candidate should be able to communicate something that the voters can understand and identify. He needs to work on a good sales pitch to increase his chances of winning. He needs to know what his target audience wants, and then he should sell that.

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Infrastructure Conglomerate

Essar is one of the most talked about conglomerates of India and has its presence into business through oil & gas, shipping, construction, telecom & BPO, steel and power. The Rs. 110 billion group has been largely consolidating its holdings under the Essar Global; Ernst & Young being the adviser to the group.

The telecom arm – better known as Hutchison Essar has been one of the key businesses of the Group. In July 2006, Essar increased its stake in the HEL (Hutchison Essar Limited) by 6.26% to make it 22.02% from the previous 15%. It accelerated in the telecom sector by few significant moves; buying out TPG Nambiar’s 13% stake for Rs.1.25 billion in BPL Communications was one of them. It is on the grapevine that Essar is getting into retail by this December via. selling mobile phones and Richard Branson is said to provide the technical support and store design to it.

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“shop until you drop”

Finally, as energy prices have begun to decline and as interest rates have recently come off , the consumer’s endless energy to “shop until you drop” may once again be revitalized.

Then, there is also a technical reason for my renewed caution about holding longer dated Treasury securities. At the end of August, Large Speculators held record net long positions of Ten-year Treasury Future Contracts – indicating too much bullishness among these market participants.

Based on these indicators, investors should, now, not at all be falling in love with bonds based on a recessionary scenario, but they should actually be selling bonds aggressively...

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With massive poverty all around, Parvanov’s victory is holl

Parvanov came to power in 2001, but interestingly, after having secured 53% against the then incumbent President Petar Stoyanov in the first round, a run off was held even at that time due to pathetic voter turnout. President Parvanov’s steadily growing vote share is an indicator of his increasing popularity, but repeated low voter turnout indicates people’s lack of trust in democracy, which is the result of many factors, with the leading cause being poverty. EU or no EU, if Parvanov doesn’t focus on poverty eradication, the only thing that might get eradicated before the next polls, is democracy!

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Civil war in Sri Lanka

If civil war in Sri Lanka escalates, there is a real danger of LTTE becoming active in South India again. Remember how it assassinated former PM Rajiv Gandhi? A desperate LTTE that’s pushed into a corner can wreak havoc in Tamil Nadu. Continued violence & instability in Bangladesh will result in two dangerous consequences. The menacing influx of refugees will only aggravate, leading to more social & communal unrest. Worse, instability in Bangladesh will encourage terrorist outfits there to execute more ghastly attacks in India. Something similar will happen if things go out of hand in Nepal. It’s an open secret that the Maoists in Nepal & Naxalites in India have formed a strategic alliance that could jeopardise India’s internal security. Even the Pakistani establishment also displays overt enmity against India. Yet, it’s the only entity that can control, rein in and subjugate the crazed jehadis, who seem committed to the destruction of India.

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EXPLOIT UNDERSTANDING OF PRODUCT MARKETS

Product markets oft en turn out to be unique because customers’ needs and tastes are idiosyncratic. Local companies are the first to realize that and to build businesses around distinctive national characteristics. For instance, Jollibee Foods thrives because it realizes that Filipinos like their burgers to have a particular soy and garlic taste; Nandos is growing in South Africa by providing cooked chicken that suits local palates; and Pollo Campero is doing the same in Guatemala.

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India must upgrade its R&D

Drug development calls for colossal expenses. And even Big Pharma companies are facing a drought of blockbuster drugs. That, despite the fact that a firm like Pfizer spends up to $7.57 billion a year (around 7 times Ranbaxy’s annual turno ver, to put it in perspective) on R&D, which is around 14% of its sales. Financial Times Research Centre unveils that a new drug to market can now cost anything between $900 million and $1.2 billion.

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Bush administration should understand the need to act wisely and not forcefully

And just when one is lulled into thinking that oil is not the root-cause of the current action in Iraq, reality pulls us back. Bush recently invited journalists to imagine the world fifty years from now with no thoughts on the future of science and technology, or a global population of nine billion, or the challenges of climatic changes and bio-diversity. Instead, he wanted to know whether Islamic radicals would control the world’s oil supplies in the next half-a-century!

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The Traffic

“The main reason that makes road safety suffer in India is that instead of one specialised department to tackle the problem, we employ a number of agencies to look into road accidents,” says Nishi Mittal, Scientist, Central Road Research Institute.

In India, the traffic police still lack the authority to register and investigate road accidents. In case of an accident, it is the non-traffic police who are expected to look into it. This obviously does not give any opportunity for specialisation in the concerned field. As a result, reliability and regency of data on national scale is affected. Central agencies depend on state governments for data on road accidents as traffic management is a state subject

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Conventional wisdom teaches us that a fool and his money are soon parted

Based on this example, the first company is better at converting its investment into profit. Godrej Consumer Products Ltd. (GCPL) emerges as the numero uno in the RoA, followed by Nestle India and ICSA (India). Godrej has a three year average ROA of 1.36 (over an average asset base of Rs.680 million), Nestle has an average ROA of 0.79 (over an average asset base of Rs.3.45 billion) and ICSA, which is into power utilities & energy management business, has a ROA of 0.72 (over an average asset base of Rs.78.4 million).

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So why is m-cap of pristine importance and who are the winners?

That is, increase or decrease in share price of a company can be an indicator of the company’s performance; as the same is affected by many external factors like issue of bonus shares, right shares, share splits, share consolidations, and of course the present value of future cash flows to the corporation. The market cap of a company – that is computed by multiplying the market price per share of a company with the total number of shares – should technically remain unaltered in all the aforementioned cases (except due to factual performance changes in the corporation) as the fluctuations in share prices get adjusted automatically due to the proportionate changes in the total number of shares.

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ITC’s net sales for the year 2005-06 were Rs.97.86 billion

ITC’s net sales for the year 2005-06 were Rs.97.86 billion, which is an increase of 29% over last year. Profit after tax (PAT) of the company increased from Rs.21.91 billion in FY05 to Rs.22.35 billion in FY06. ITC’s market capitalisation expanded by a mind boggling 120% in FY06 and reached Rs.732 billion. “Any strategy for inclusive and sustainable growth would necessarily need to encompass rural India,” reasons Y. C. Deveshwar, Chairman, ITC. And the proof of the pudding has been in ITC’s e-choupal model, with which the company has tried to tap the hinterland; a reason due to which this company has become a case study at various leading business schools across the globe. Truly, at one time in the past decade, this company was talked about in the media just for the internal wars brewing within the boardrooms of the company, when its parent British American Tobacco was trying to wrest control away from the typically “Indian” management monopolising decisions.

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Minto Fresh:- Bole to Ekdum Fresh

BRAND: Minto Fresh
AGENCY: FCB Ulka
BASELINE: Bole to Ekdum Fresh

DESCRIPTION: As he starts his show, Magician Shambhoo’s eyes fall on a pretty girl and he falls in love. The girl too seems interested in him. But there’s a mustachioed guy with her — who’s the spoiler. It turns out that the mustachioed guy is also a magician. The two decide to have a contest to see who’s better. Popping in a Mintofresh, Shambhoo blows a smoke heart at the girl, who is mesmerized and then disappears from the scene. In the next scene, the lovelorn couple are seen riding a bicycle to the moon.

4Ps TAKE: Taking forward its theme of boy winning a village girl, this one too plays on the same concept. The ad scores highly on bringing out the clinching benefit to the brand, and the reward to the prospect which is fresh breath and therefore the promise of the ability to win over girls. The concept may be clichéd, but it’s executed in a quirky and funny way that grabs the eye.

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What’s next on the cards?

... to be the best pizza delivery company, taking immense care of our customers. When we completed 10 years in India, we didn’t launch a new logo, instead we gifted our consumers a family ‘meal for 4’ at an economical price, that is 4 regular pizzas just at Rs.45 per pizza.

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Numbering game’s passé; it’s time for the ‘naming’ game, and then some more!

But then, why have strange sounding four-letter names... SLVR instead of Silver, RAZR instead of Razor and ROKR and COCKR in places of God knows what! “Consumers don’t look at these names in an abstract manner and therefore our four letter names are worked out accordingly to convey a message to consumers,” explains Mathias. Seems those guys out there did get the message. Or else why would Moto rave about its resounding success? Or why would other handset-makers latch on to the bandwagon? Why indeed!

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End of an era at Wal-Mart

In 1962, when Sam Walton founded Wal-Mart, he started the ‘layaway service’. This meant that the chain catered to shoppers who were cash-strapped, who didn’t have credit cards: The deal was that the shopper could make a nominal down payment, and then get 60 days’ time to pay the rest of the amount. Wal-Mart Stores recently announced that it is going to scrap this tradition – due to falling demand and rising costs. Starting November 19 this year, the layaway service will be terminated.

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“The Truth, Not Just Promises.”

Incidentally, at that time, Colgate toothpaste ruled the market with a massive 59% market share. Expectedly, Colgate took HLL (which owns Pepsodent) to court, and HLL had to withdraw its ads. On the personal care front, HLL stirred another hornet’s nest Com when it came out with an advertisement that read, “The Truth, Not Just Promises.” The ad went on to explain how ‘Fair & Lovely’ was much more effective than ‘No Marks’. Ozone Ayurvedics, the owners of ‘No Marks’, did not take this lightly.

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‘World Investment Prospects to 2010’

According to the findings of ‘World Investment Prospects to 2010’, FDI into India will grow but will remain very low in relation to the size and potential of its economy. The reason is quite obvious: although manufacturing is open to foreign investment and there has recently been substantial liberalisation of the FDI regime in some sectors such as telecommunications, factors like inflexible labour laws and poor infrastructure are acting as a major barrier to investment.

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