panch-tattva talk

Friends,

I think that the directors representing promoters or promoters
themselves as directers should not be allowed to draw emoluments from
the companies concerned. it is a priviledge that they have over other
share holders that they in a position to look after the their own
investments in a better manner while other have virtually no say. Not
only this they have had the priviledge of charging premiums from the
public at the time of IPOs.already. They have always an occasion to
give themselves preferential allotment of equity or quasi equity, they
have influence to make the company buy its own shares if this is felt
OK in view of the future investment plans of the copany. On top of all
this they be rewarding themselves by way hefty salaries is some thing
in bad taste. Even if the govt. does not make such a rule , the
prudence on the part of promoter demands that they observe the above
discipline.

Secondly, an employee of the company should have to devote whole his
time to companies work which is not the case with the promoter
directors as they have their plateful for so many other activities. It
is however ok for them to gets reimbursement for the expenses
relatable to company’s work. The non-promoter CEOs may be paid
whatever is deemed right for they are invited to join the company on
the strength of their expertice and are not thursting them selves on
the strength of their voting power. The sleeping partners should be
under comfort that their investment is no inferior to the big guy’s.

Dholakia of IIM-A is to end innings shortly . He was responsible to
raise the income of the institute by 460% over five years to Rs84.04
crs.

SEBI wants to simplify  procedure for debt issues that would lower
cost and increase transparency.

Giants of the world like UBS, Societe General, Morgan Stanley and AIG
etc. are eyeing Indian super rich for entering wealth management
business.

DLF would be part of Sensex replacing Dr Reddys w e f  Nov 19th ‘07.

ICICI Bank’s arm launches overseas trading services for the resident
Indian customers enabling them participation in trading on US bourses.

Ambani Bros are worth over $80b and thats nearly 8% of Indias’ GDP>

Centre has issued ultimatum to SEZ promters to comply with the
formalities for notification of their SEZs failing which their
approvals will be cancelled. The greedy promoters have taken back seat
, it seems , due to the new norms of land aquisition where their
commitment rises in terms of risk and outlays.

SBI has cut home loan rates and ratail loan rates by 50 basis points
to 200 basis points. SBI is planning to have addition ATMs in next
three years.

Suzuki sold more cars in India than in its home country Japan for th
first time . It has been here for just 25 yeras.

In A.P. some 3 million tonnes of cement is produced by mini cement
plants and it woul go up to over 7-8 million tonnes after expansions
which are underway. Their quality is also on par with big producers.
Pakistan would be sending cement through Wagah border at about 50/60
rupees cheaper than Indian prices of 230/- per bag , this was made
possible by the cheaper dollar.

IMF has cut global growth estimates by 0.04 % to 4.8% in face of th4
US credit market turmoil, while India and China would maintain growth
rates at 8.5% and 10% , rest of the world would have some lower growth
however.

Total vehicle sales in Sept 07 were 889693 units down by 9.58% over Sept 06.

World market cap on 10th Oct 07 stood at 61263 b while India had 2.28%
share and China had 5.70% share.

USD LIBOR rates for 6 month maturity was 5.22% on 10th Oct 07.

Cabinet okayed bind issue of Rs23458 crs to compensate for the deficit
in oil price realisation.

While India and China are promoting use of Biofuels but its
propagation may result in water scarcity as the related crops require
lot of water. India should actually concentrate on water resource
management seriously as its has enough water but no concrete plan to
retain it for use in lean month. I think man made big reservoires
should be set up across all catchment area in the country by
scientific topographic studies.

The leading indices were up during last week also but conviction was
lacking. This seems to be near peak times and best to be out of the
market than in to it.

HariOm,
krsnaKhandelwal

panch-tattva talk

Friends,

I reproduce below the leaf from my diary on the 19th April 2001, since it may have some relevence today too:

‘ Big bull Harshd Mehta Banned for Life :SEBI bans BPL,VIDEOCON and STERLITE from Capital Market’

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‘It is almost amusing to read the report about ban for life on Harshad Mehta  and debarment of BPL,Videocon and Sterlite for accessing capital market. Isn’t it pitiful that sleeping partners of public companies should suffer for the fault of greedy managers (greed not for companies concerned but for themselves) at the hands of watchdog of their interests. The paradoxes in Kaliyug appear in many and varied forms with inexplicable intricacies.

Furthermore, no steps seem to have supposedly been taken for the recovery of wrongful gains in the hands of maniipulators and schemers. Further pity is that where simple examination of records and books and a few interviews were required to unearth whatever went wrong , it has taken three-four years.

I only hope that no body was influenced to make meaningless pronouncements and , make lenient  punishments and bury the hatchet for record.’

The above may well happen again, the market action suggest manipulation of no ordinery kind and since the companies whose shares have goen past all possible limits of price for no apperent reason have their management in complete silence, while it should be their duty as much as in respect of insider trading rules , to make an announcement about the companies business affairs that nothing extraordinery is happening on shop floor , in their cost structure or in their markets for end products. The purposeful silence is much a insider trading activity as it otherwise. But lack of imagination is one trait that runs across all the governmental departments and organisations.

HariOm,

krsnaKhandelwal