Weekly Column

·        JAPAN’S ECONOMY

The Economist reports that the largest retailer in Japan recently announced a payhike for around 54000 of its employees. This will be their first basic salary hike in four years. This is a big news for the country that hasn’t seen the mercury on the price-meter rise for about 15 years now. As reported, Japan is trying to achieve sustainable growth by printing money. So it can well move from deflation to hyperinflation as opined by expert.

·        REAL ESTATE MARKET – INDIA

There is a slowdown in real estate market but luxury segment of the market is immune to this slowdown. Recently, about 5000 homes priced at Rs 30 mn and above were lauched in major metros because of increasing demand in this segment. India’s super rich still prefer hard assets like real estate over intangible like stocks and bonds. Increasing demand by the rich is increasing property prices. Affluent class is immune to price changes. The demand continues to persist irrespective of the general slowdown in the housing market.

·        ITALIANS SHUTTING DOWN BUSINESSES !

Italy is one of Europe’s largest economies with about 6 mn companies. It is also one of the worst affected by the crisis. The country saw nearly 365000 businesses shutting down last year. The small and medium-sized businesses are the worst hit. Nearly, 50 % of the small firms are being unable to pay their employees on time.  This crisis is attributed due to clumsy bureaucracy, rigid labour laws and declining competitiveness in the global markets. Tax increases and spending cuts have pushed Italy into one of the worst recessions of any Eurozone economy.

·        CHINA’S WARNING TO REACH COUNTRIES

The current round of money printing by the developed economies have devalued their currencies which has huge global implications. For economies like China which rely heavily on exports as well as imports, devaluation of the developed economy currency makes China’s exports unattractive. This hurts them on export front and even on import front. Floor of money leads to higher asset prices including natural resources like oil. This is why the Chinese Premier has issued a warning against the devaluation of currencies by the rich countries.

·  SECURITIES & EXCHANGE BOARD OF INDIA MOVES SUPREME COURT, SEEKS DETENTION OF SAHARA’S SUBRATA ROY

India’s stock market regulator has asked the Supreme Court to order the detention of top Sahara group officials including its head Subrata Roy, reinforcing the hardline stance it and the finance ministry have taken against the conglomerate. SEBI filed an application seeking the detention of Roy and two other directors – Ashok Roy Choudhary and Ravi Shankar Dubey – after giving reasonable opportunity of hearing.

·        DR REDDY’S FOUNDER – NO MORE

Kallam Anji Reddy, founder chairman of Dr Reddy’s Laboratories Ltd and the pioneer of drug  discovery research in India, died. He was 72. He founded Dr Reddy’s in 1984 with Rs 2.5 mn in initial capital and built it into India’s second largest drug maker with sales of Rs 96737 mn last year.

·        ISUZU TO INVEST RS 15000 MN TO SET UP LCV PLANT IN INDIA

The plant at Andhra Pradesh in India which will produce 120000 units annually, will be second Isuzu facility to produce LCVs globally. Isuzu Motors India Private Limited is a wholly owned subsidiary of Japanese auto maker.

·        INFOSYS SIGNS DEAL WITH INDIA POST

India’s second largest software exporter, Infosys Ltd has signed a deal with India Post to manage its rural operations platform, months after it signed a separate deal with the state run postal network that was the biggest financial services contract over for an Indian information technology services company. This project will allow more than 130000 rural post offices to offer online services.

·        INDIA DOWNGRADES DIPLOMATIC TIES WITH  ITALY

The Indian government is downgrading its diplomatic ties with Italy and has asked its ambassador designate to that country Basant Kumar Gupta who was scheduled to leave for Rome recently. The Italian government reneged on its promise to send back two marines, facing trial for allegedly killing two Indian fishermen.

·        RELIANCE INDUSTRIES TO INVEST $ 27 BN IN FOUR YEARS

Reliance Industries will invest around $ 27 bn in the next four years till the end of fiscal 2017 across the various businesses according to Deutsche Bank AG report issued after its analysts met one of the company’s two joint chief financial officers.

J O K E

A large company, feeling it was time for a shake-up, hired a new CEO. The new boss was determined to demonstrate his decision making ability and wanted to immediately take action to rid the company of all stackers. On a tour of the facilities, the CEO noticed a guy leaning on a wall. The room was full of workers and he wanted to let them know that he meant business. He walked up to the guy  leaning against the wall and asked, “How much money do you make a week?” a little surprised, the young man looked at him and replied, “I make $ 300 a week, why?”   The CEO then handed the guy $ 1600 in cash and screamed, “Here’s four weeks pay, now get the hell outta here and don’t come back.”  Feeling pretty good about himself, the CEO looked around the room and asked, ‘Does anyone want to tell me what that goof-ball did here?”

From across the room came a voice, ‘Yeah, he’s the delivery guy from Domino’s Pizza.

INSPIRATIONAL

Mac Anderson : EXPECT TO WIN  : Today is the best day to begin…the best opportunity for a new destiny. If you believe that time has passed you by, your best days are behind you or that somehow you’ve failed too many times to have another chance, nothing could be further from the truth.

“There’s nothing in the middle of the road but yellow strips and dead armadillo,” says Jim Hightower. Decide to do something now to make your life better. The choice is yours.

David Ambrose remarked, “If you have the will to win, you have achieved half success, if you don’t you have achieved half your failure.” The moment you definitely commit yourself, change begins. All sorts of things happen to help you that never would have otherwise occurred. Kenneth Blanchard observed, “There is a difference between interests and commitment. When you are interested in doing something, you only do it when it is convenient. When you are committed to something, you accept no excuses, only results.” Lack of decisiveness has caused more failures than lack of intelligence or ability.

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THIRTY YEARS CELEBRATION  OFFER !

SPECIAL OFFER@SPECIAL RATES :  CREDIT REPORTS ON GLOBAL BUSINESSES, BAKCGROUND CHECK ON INDIVIDUALS & COLLECTION OF OVERDUE ACCOUNTS

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Weekly Column

MODI FIASCO  AFFECTS THE WHARTON BRAND

‘Disappointing that Wharton rescinded its invite’, says Zee News.

“After Wharton snub, Narendra Modi to address NRIs in USA,” says Economic Times.

“Inside story: why Wharton cancelled Modi’s lecture,” is the Hindustan Times headline.

Those who read only the headlines in the newspapers or on news TV channels would be under the mistaken notion that the whole flip-flop drama that first saw Narendra Modi being invited and subsequently uninvited involved the Wharton School of The University of Pennsylvania.

It did, but only tangentially. Modi was invited and uninvited by the organisers of the Wharton India Economic Forum (WIEF) and not by the school – and the WIEF is clearly an India-focused event. The WIEF site has a clearly India-focused url – it’s called www.whartonindia.com.

Yet, the headlines scream ‘Wharton’, not ‘Wharton India Economic Forum.’ The headlines do considerable damage to the brand that is the Wharton School, as the lay reader presumes that Wharton School is the body that has made and unmade the decision to invite Modi.

AGGRESSIVE PM TAKES DOWN BJP

Prime Minister Manmohan Singh has found a voice and is slamming the main opposition party, the BJP in Parliament!

At first the premier lambasted the language used at the BJP National Council meeting against the meeting and said, “I do not wish to reply in the same language.”

“Jo garajte hai, woh baraste nahi. We are not seeing this arrogance of the BJP for the first time. In 2004 the India Shining campaign yielded disastrous results”, he added. Unsurprisingly this yielded roars of approval and table thumping from the treasury benches, while the opposition seems to be sitting in stunned silence. He added that the NDA would see a similarly disastrous performance given its continuing address.

The comments were made in the Lok Sabha as part of his reply to the President’s address to Parliament.

Prime Minister Manmohan Singh defended the UPA economic performance and said he was of the opinion that the slow-down in the economy need not persist, and that growth of 7 to 8 percent was possible.

“The debate on the President’s address has been vigorous and wide ranging. As Hon’ble President mentioned in the initial parts of his address, our economy has faced a difficult situation in the past year. However, I do want to emphatically endorse the view of the Finance Minister that the slow-down in the economy need not persist”, he said.

Singh added that although growth would remain a priority, the focus would be on inclusive growth.

INDIA HAS ALL REQUIREMENTS TO RETURN TO 8% GROWTH: MONTEK

India has all the requirements to return to a GDP growth rate of 8 percent in the coming years, Deputy Chairman of the Planning Commission Montek Singh Ahluwalia said, while highlighting that current account deficit is a big problem right now.

“India has averaged 7.5 percent growth in the last 10 years. It should have done that for 15 years but it is possible to bring it back to the average performance of the last decade. The target for 2013-14 is 6.5-7 per cent and then accelerate further. India has all the requirements to return to 8 percent, even if it is later than expected,” he told a gathering of students and academics at Oxford University.  

“A little over 5 percent is a slowing down but the whole world is experiencing a slowing of growth. It is a worry because we expect much more but it is not as big a disaster as the media makes it out to be. Growth is important but that growth has to be inclusive and sustainable,” Ahluwalia said

“The state of the world economy is a challenge. The focus of government policy is to re-assure foreign investors that India is wide open for business. India has the human resources in place and an expanding private sector. The only problem is the current account deficit. But the global financial system appears to be stabilising and the most important message is that India is a good bet for foreign investment and that message is getting across,” he said

RIL TRASHES GSM LOBBY; SIBAL REJECTS ALLEGATIONS OF FAVORING COMPANY

Both Reliance Industries and Telecom Minister Kapil Sibal have rejected the GSM lobby’s allegations that the government is unduly favouring the Mukesh Ambani-promoted company by allowing Reliance Jio Infocomm to offer voice services using 4G spectrum.

The telecom commission had recently said that firms with the broadband wireless access (BWA) airwaves can provide voice services along with high-speed Internet by paying an additional Rs 1,658 crore. 

Two days back, COAI wrote said the policy of allowing broadband players to offer voice telephony was illegal. It had alleged that in the notice inviting application, issued prior to the broadband spectrum auction in 2010, it was clearly written that companies that chose to pick an Internet service provider licence (ISP) will not be permitted to offer voice service.

PROBABLE FUTURE PM RECRUITS GUN TOTTING MP

Vitthal Radadiya, famously known as the "gun-toting MP", has joined Mr Modi's party, the BJP today. He quit the Congress in a huff last month.

On stage in Dhoraji, Mr Radadiya looks familiar. He is dressed in the same white that he wore when he appeared on national television in CCTV footage last year when he was a Congress MP, walking about angrily at a toll booth, muttering and brandishing a big gun, which he then pointed at an astonished toll attendant.

The Congress has sought to remind the BJP that not long ago, it had called Mr Radadiya "a gangster." "Now he is their darling...I feel like laughing at the BJP," said central minister Rajiv Shukla. 

AIR ASIA JV GETS IN PRINCIPLE NOD BUT FDI GUIDELINES MAY COMPLICATE DEAL

AirAsia’s proposal to start a fresh airline in partnership with the Tatas and Bhatias has been given an in-principle approval by the Foreign Investment Promotion Board (FIPB). 

Top officials in the Ministry of Civil Aviation told Firstpost that the clarification this ministry has sought from the Department of Industrial Policy and Promotion (DIPP) over whether the proposal falls under the Government’s guideliness on FDI in aviation should “come very quickly, in a day or two at best”.

Their doubt stems from the wording of the FDI guidelines which have permitted foreign airlines to invest in Indian carriers up to 49%. These guidelines do not specify whether such an investment can also come in a new company which has yet not been set up.

The officials made it clear that there will be a very close scrutiny of the new airline’s proposal for a flying permit in terms of the minimum paid up capital and aircraft mandated and also whether it meets the other norms of FDI in aviation. “We will ensure compliance with rules which require that the foreign partner has only one-third representation on the airline’s board of directors and that substantial ownership and control of the airline stays with Indians are complied with. Let the proposal come to us, we will examine it closely”.

Malaysian airline AirAsia Bhd has said it wants to take 49% equity in the new airline, with Tata Sons holding 30% stake and the remaining 21% being held by the Bhatias. The Tatas have made it clear that they won’t be involved in the functioning of the airline.

QUOTE FROM PM'S SPEECH

"MEN OF ENVY DISPARAGE EVERYTHING" - DR MANMOHAN SINGH.  

J O K E

"Daddy," a little girl asked her father, "do all fairy tales begin with 'Once upon a time'? "

"No, sweetheart," he answered. "Some begin with 'If I am elected.'"

THIRTY INSPIRING YEARS !!!

Dear friend  :

Greetings !

On the 2^nd March 2013, MIRA INFORM completed 30 years. During this period, MIRA INFORM produced millions of Business Information Reports on businesses and carried out various kinds of Background Check on individuals from most of the major countries for international clients. As we commemorate this special occasion, I would like to convey my deepest gratitude to you, our valued clients for your unstinted faith and support through this memorable journey. Your continuous trust has indeed significantly strengthened our shared aspiration of creating one of Asia’s respected Business Information Company. Mira Inform Japan Limited, Tokyo was born on 12^th February, 2013 !

The journey of excellence is undoubtedly a tribute to our clients, partners, associates and our dedicated employees of today and yesterday – who have steadfastly stood by us through this  voyage of change and challenge. These 30 inspiring years have been marked by overarching VISION to serve a larger national purpose, to live up by the strong VALUES and to nourish internal VITALITY to create superior value for all our stakeholders and important place in Business Information Market in India and overseas. As we look back on the historic journey, we feel deeply touched that our Paid up Capital was just Rs 300 in 1983 against Rs 17 mn now ! We started with Rs 1800 priced Remington baby typewriter from residence when today our aggregate offices, company, database, brand and others are valued at huge sum ! I have proud to have had the opportunity to lead MIRA INFORM since its’ inception. 

                                                                                                              With warm personal regards,

Weekly Report

US BANKRUPTCY ACTION ADDS TO ESSAR WORRIES

At a time when the oil-to-outsourcing Essar Group is looking to raise fresh money to refinance debt and bring down interest costs, it is faced with a bankruptcy action against one of its US units with creditors alleging mismanagement. Essar isaddled with huge debt on its books across companies and its plans to refinance debt, through the issue of bonds on external commercial borrowings haven’t materialized yet.  Essar has overall term debt in the range of $ 14 bn across firms. The latest challenge for Essar is a plea for bankruptcy filed against Trinity Coal which the group acquired in 2010.

US ECONOMY : CURRENT SCENARIO

Wal-Mart, the largest retailer in the US has given a subdued forecast for its sales. The country has been gripped by the slowdown since the outbreak of the crisis.  Inflation and tax rate have been going up. The picture does not look too bright for 2013 either. The US Fed and policymakers have been printing money through their numerous QE programs.  The reason given  by them has always been that the money will stimulate the economy. But all it has done is to stoke inflation and asset prices. 

Federal Reserve chairman Ben Bernanke strongly defended the US central bank’s bond buying stimulus before Congress, recently – saying its benefits clearly exceed possible costs.

JP MORGAN TO CUT 19000 JOBS BY NEXT YEAR

J P Morgan Chase and Co., the biggest US bank, expects headcount to decline by as much as 19000 jobs in its mortgage and community banking businesses by the end of next year.

HELICOPTER DEAL : CORRUPTION CHARGES

The Central Bureau of Investigations registered a preliminary enquiry against former Indian Air Force Chief S P Tyagi, his three cousins and 11 others over allegations of kickbacks in the purchase of 12 helicopters from Anglo-Italian defence company AgustaWestland, a unit of Finnmeccanica SpA.

Rs 36000 mn for 12 helicopters is quite a large outlay at Rs 3000 mn per helicopter ! It is 17.3 % of Government expenditure of Rs 207840 mn for all social services including education, health, broadcasting, etc.

H.J.HEINZ COMPANY

Legendary investor’s latest move, the ace investor has teamed up with Brazil’s richest man Jorge Lemann and cracked the biggest ever acquisition deal in the food industry. The name is H J Heinz Co., the famous ketchup maker. It was announced that Berkshire Hathaway Inc and 3G Capital Management LLC have agreed to acquire the company for US $ 23.3 bn. Heinz has been in existence since 144 years ! It is one of the most familiar brands in the US and enjoys bestselling status in over 50 countries. Heinz has an impressive track record of steady growth. The company pays out more than US $ 600 m as annual dividends.

PHILIPS TO DROP ‘ELECTRONICS’ FROM NAME

Dutch manufacturing giant Koninklijke Philips Electronics NV said, it intends to drop the word ‘Electronics” from its name as it shifts away from consumer based entertainment towards health, well being and lighting products.

ENTRY OF FOREIGN RETAILING COMPANIES IN INDIA

It seems that the real estate sector is on the verge of a revival due to entry of foreign retailing companies.  Starbucks and IKEA, a Swedish furniture company are set to expand into major Indian cities.  Other foreign chains like Hennes & Mauritz, Hamleys, Lacoste and others have geared up to expand their India presence. Expansion by these firms is likely to increase the demand for commercial real estate. It appears that 2013 could well witness a turnaround in the commercial real estate market.

UK’S ECONOMY

First it was US, then came countries like France and now the UK. UK is the latest to face the axe on the credit ratings. UK’s economy is showing hardly any signs of a full blown recovery.  Any further loosening and it could face a fresh round of downgrades.  If it tightens more, the economy will slide further into the danger zone.

FINANCIAL HEALTH OF INDIAN COMPANIES

It is believed that the financial health of Indian companies is not as vunerable as that of their Western counterparts. But it is not true. Take interst coverage ratio, a measure of a company’s ability to pay interest on outstanding debt. As per data from Mint, for the 3500 companies listed on Stock Exchange, this ratio has dropped from 5.9  times in December 2007 to 2.7 times in the quarter ended December 2012.

SAVINGS IN INDIA : CURRENT SCENARIO

Financial savings as a percent of total household savings have come down dramatically in India over the past few decades.  Households have increasingly preferred to invest in physical assets such as real estate and gold rather than financial instruments like mutual funds and equities.

INSPIRATIONAL

John Mason :  Don’t be afraid to take small steps. There’s something powerful about momentum… no matter how small. Many times the impossible is simply the untried. I can remember a time in my life when I was immobilized with fear, consumed with what I was supposed to do. It seemed so huge a task, I was unable to bring myself to face it. A friend came to me and spoke two words that broke the paralysis in my life. He said, “Do something!” I’ll never forget day… taking some small, seemingly insignificant steps. Momentum began to come into my life. If you are a point of paralysis in your life because of what you feel you’re supposed to do, the words today are, “Do something!” Don’t worry about the long-term goal right now, just take the steps that take you past starting point. Soon you’ll get to a point of no return. As you climb higher, you’ll be able to see much farther.

J O K E

A young businessman had just started his own firm. He rented a beautiful office and had it furnished with antiques. Sitting there, he saw a man come into the outer office. Wishing to appear the hot shot, the businessman picked up phone and started to pretend he had a big deal working. He threw huge figures around and made giant commitments. Finally he hung up and asked the visitor, “Can I help you?”  The man said, “Yeah, I’ve come to activate your phone lines.”

THIRTY INSPIRING YEARS !!!

Dear friend  :

Greetings !

On the 2^nd March 2013, MIRA INFORM completed 30 years. During this period, MIRA INFORM produced millions of Business Information Reports on businesses and carried out various kinds of Background Check on individuals from most of the major countries for international clients. As we commemorate this special occasion, I would like to convey my deepest gratitude to you, our valued clients for your unstinted faith and support through this memorable journey. Your continuous trust has indeed significantly strengthened our shared aspiration of creating one of Asia’s respected Business Information Company. Mira Inform Japan Limited, Tokyo was born on 12^th February, 2013 !

The journey of excellence is undoubtedly a tribute to our clients, partners, associates and our dedicated employees of today and yesterday – who have steadfastly stood by us through this  voyage of change and challenge. These 30 inspiring years have been marked by overarching VISION to serve a larger national purpose, to live up by the strong VALUES and to nourish internal VITALITY to create superior value for all our stakeholders and important place in Business Information Market in India and overseas. As we look back on the historic journey, we feel deeply touched that our Paid up Capital was just Rs 300 in 1983 against Rs 17 mn now ! We started with Rs 1800 priced Remington baby typewriter from residence when today our aggregate offices, company, database, brand and others are valued at huge sum ! I have proud to have had the opportunity to lead MIRA INFORM since its’ inception.

                                                                                                              With warm personal regards,