IIPM ARTICLE BROADCAST: February 2013

Monday, February 11, 2013

Past, present and future of the company...

Chairman, MMTC with jayant mundhra on past, present and future of the company...

B&E: Who do you bear in mind as your target audience?
SB: India’s obsession and fascination with gold is well known. While some section want to keep it as a safeguard for the future, another section want to use it for purpose of jewellery. So, almost all classes in India are our target audience.

B&E: You are mainly into import of gold and selling it in India. Keeping that in mind, what is the relevance of ‘Festival of Gold’ that you hold every year?
SB: We are the biggest supplier of gold, but at the same time, our main focus is on importing gold. However, 1989 was the first year when we imported gold and sold it in the Indian market. As far as the ‘Festival of Gold’ is concerned, it has been a huge success ever since it came into existence. In fact, the festival is an exhibition where we showcase our products as well as varieties of gold to buyers from across the country. In fact, the gold fest is a platform where buyers get a platform to interact with us at length. Apart from this, the exhibition also helps artists, who come from various regions of the country, to showcase their artworks.

B&E: For the first time, MMTC recently entered into a joint venture (with Gitanjali Jewellers) to move a step closer to the retail consumers. How do you see the road ahead?
SB: This is the first time that we are entering into a joint venture and I must say that Gitanjali Jewellers is a great brand to start with. They are very aggressive in their approach to tap the market and have got tremendous brand recognition amongst Indian populace.

B&E: According to you which is your core competence?
SB: Our core competence is in doing purity check of gold and then hallmarking it accordingly. This kind of service is not provided by any other player in the country. Hence, we have also developed a special symbol for our hallmark. To understand the kind of gold a person is buying, all one needs to do is look for a hallmark.

B&E: How well has the market taken up the job of quality check so far?
SB: We first opened our shop in New Delhi, and at present, we are operating with 11 stores across India. The response has, however, been tremendous. We are now planning to increase that number to 63 shortly.

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Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.

2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
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Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
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IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face
IIPM – FLP (Flexi Learning Program)

Friday, February 08, 2013

THE SUNDAY INDIAN EXCLUSIVE

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Thursday, February 07, 2013

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

Dutch national Will Heum’s arrest in Chennai for having sex with minors and uploading pornographic pictures on the Internet came as an isolated shock to the nation. But a TSI investigation finds out that paedophilia is rampant in India’s cities. The number of sick and rich individuals who want to have sex with minors is large enough to sustain a thriving business involving middlemen and child sex workers. So if any of you thought paedophilia was a western malaise that would not affect India, you could not be more mistaken.

Children are the easiest to be taken advantage of. Poverty as well as their desire to own the latest gadget make them vulnerable to overtures of middlemen. Most kids, whom the TSI team met, had told their parents that they were going for study or dance lessons. To explore more, the TSI special investigative team visited Faridabad, Noida, Delhi, Mumbai and Goa many times. What was astounding was that despite being minors, these kids spoke and reasoned like adults, obviously trained by the pimps who brought them along. Another startling fact is that not only kids from poor and needy families are being trapped in this racket. Kids from rich or well-to-do families are also lured into the trap.

We got lead about Ansh, a pimp in Noida. One of us posed as an Australian NRI on the phone and he agreed to meet us. The next day, we met Ansh at a coffee outlet in Noida market. We reached much before time, eager to find out who all accompanied him. There were two more people, one of them a girl. When we met him, a kid sitting next to him greeted us. He said he was 14 years old, but looked younger. The smartly dressed kid looked like from a well-to-do family. The kid said his father was a big officer in Indian Railways. He was so confident that we felt we were not talking to a child but a professional.

TSI-What work do you do?
Boy-I am a student.

TSI - Where do you study?
Boy-I am in the XIIth standard

TSI-What is your age?
Boy-14 yrs

TSI- But you don’t appear 14. Incase you are wondering where I got your number from, I saw an ad in the newspaper and picked it up.
Ansh-Yes. We have advertised many times in newspapers.

TSI-What do you advertise for?
Ansh-For body massage

Wednesday, February 06, 2013

Micromax’s quest for the 2nd spot

It was a rather quick climb up the ladder for Micromax. So far, so good. But even after becoming the third-largest handset vendor in India, it has a steep climb ahead, with threats in the names of both new entrants and seasoned players... Will it win the ‘Silver’ soon?

Two years into the business, and you dare to challenge the #1 & #2, even in a cluttered market; that for you is Micromax! It started as a distributor of PC hardware (for brands like Dell, HP and Sony) and after seventeen long years, felt the need to grow as an independent brand. Four friends got together – Rajesh Agarwal, Sumeet Arora, Rahul Sharma & Vikas Jain – and decided to grow their business. Many ideas poured in during the umpteen brainstorming sessions that the four conducted amongst themselves. Finally, they decided to bet big on Sharma’s idea – to marry mobile handsets and rural and price-sensitive India. Thus, the company’s first phone (the X1i), was born in an environment that would transform into what would be proudly called the second-largest mobile market in the world, next only to US, with about 10-12 million subscribers being added every month. Better news for the four friends, as trade pundits are predicting that the current growth momentum in the telecom industry will last till atleast 2012.

Despite all the good tidings, it still comes as a surprise that a new entrant has managed to make such a deep dent in the crowded domestic handset market. Micromax is currently the third-largest GSM vendor in the Indian market, with a share of 8.1%, perhaps just a few notches behind Samsung who at the second position has 10.4% control, as per market reports. [Nokia with 52.7% share is the number 1 vendor]. Micromax has been selling anywhere around a million handsets every month, for the past year, and as company officials state, it has earned about Rs.15 billion in revenues during the past year. So here’s something to digest – going by the numbers, the Indian handset market is estimated to have sold about 130 million handsets units in the last calendar year alone, which implies, that if we were to consider just the sales during the past 12 months, Micromax has a market share of 9.3%, much closer (as compared to the previously stated 8.1%) to the 10.4% share of Samsung!

And there is a lot more to be had from a handset market that currently, only has a tele-density of 49.5% and has supposedly clocked a turnover of over Rs.200 billion over last year. Little wonder, that many global bigwigs like Nokia, Samsung, LG & Sony Ericsson have time and again referred to India as one of their key markets. But with great opportunities, come greater challenges, and the same is true for the #3. Once, Micromax was a challenger; today it is also being challenged by many entrants like Karbonn, Lava, Maxx, Intex, Lemon, Gee Pee, Videocon, Usha Lexus, Orpat, Airfone and many more... Talking about the growing count of challengers, Deepak Kumar, AVP, Research, IDC India says, “The number of emerging mobile handset vendors in the India market had grown to 26 in Q2 CY2009 and their contribution to overall shipments in terms of units crossed 6.3% for the first time during the 12-months leading to June 2009. This is as against only 11 emerging vendors representing a share of 1.2% of overall shipments during the previous twelve-month period.”

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Tuesday, February 05, 2013

AJAI CHOUDHARY

Chairman and CEO of HCL Infosystems Limited discusses the company’s future growth plans with B&E’s Neha Saraiya

B&E : HCL Infosystems recently raised Rs 472.6 crore from institutional investors via a qualified institutional placement (QIP) of equity shares. What are the prime investment areas that you are looking at?

Ajai Choudhary (AC): The objective of this money is to create the next growth forward for our company. The systems integration market is growing extremely fast. Although we are the leaders, there are still a lot of other services in the market that the hardware customers are looking at. So through these funds, we want to create new facilities to deliver these services.

B&E: You have announced a tie-up with BSNL for the National Broadband Penetration Programme. What benefits for HCL Infosystems shareholders do you foresee from the JV?

AC: As a company, we have already created a PC market in the rural hinterlands of India. First of all, we did a project with ITC e-Choupal along with many other projects with other MNCs. Although BSNL has done a real good work when it comes to penetration of phone market in the rural areas, no company has really looked at creating a broadband and a PC mix for this particular market. So what we thought was that as we already have many customers in the rural market, why not go and add just Rs.300 to their existing bill and give them a computer too. Basically the idea was that if rural consumers already have a wire-line connection, then why not add a small amount per month and give them a computer and a broadband connection as well. That will not only serve their need but also benefit our company at the same time. That’s where the basic idea was born.

B&E: Last year, you announced the acquisition of Natural Technologies, a niche banking software product company. How is the integration process going on?

AC: Fundamentally, what we were looking from that acquisition was to get hold of a product-company as we were not looking for a service-based company at that time. A third of India’s GDP is contributed by cooperatives and that’s exactly the idea behind the acquisition. The rural banking and cooperative segments are completely untapped in India, quite unlike the commercial sector. And as ‘Natural Technologies’ creates products for the cooperatives segment and the rural banking segment, we really discovered a huge segment out there in the bargain. Thus, we scaled up. The basic idea is that as we help grow the market in India through that product, the same product can later on be exported to companies in places like Africa. And to that extent, we have actually bid for a couple of tenders in Africa.

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Monday, February 04, 2013

Growing, growing, gone…

Aviators in India, in their race to get ahead, fell way behind

Circa 1997-98 –11.5 million passengers carried by four domestic aviation giants with a combined fleet of 25 – Indian Airlines (and Alliance Air), Jet Airways, Sahara Airlines and Archana Airways (yes, it did exist!). A kingly 50.7% share belongs to Indian Airlines. And profits? Well, that’s the only good news doing the rounds, with Rs.3.6 billion in operating profits flashing on their financial tablets! (Even Archana Airways with a fleet-size of just 2, made Rs.16.8 million in profits). The Indian domestic aviation sector ‘has arrived’! Or has it?

Circa 2002-03 – The number of airlines has been reduced to just three, with Indian Airlines, Sahara and Jet making merry with 53 aircrafts. Of course, Jet has the largest market share of 48.4%, with a fleet size of 41. Shamefully though, it becomes the only airline returning operating loss that year, of Rs.521.3 million.

Circa ‘the present’ – Six years back, some unknown face called G. R. Gopinath entered the Indian aviation sector with hopes of making the common Indian fly with the thoroughly untested ‘Low Cost Carrier’ LCC model, which had been a success in many First World countries. Common sense tells us that an annual traffic base of 7.7 million is never enough for launching LCCs, whether it’s Europe, US, India or the Cook Islands! But Gopinath expanded his fleet and offered cheap tickets (even for Rs.3, Rs.2, Re.1 – indeed, ‘cheap’!). Never did it make money (in fact, experts estimate that on an average, it lost Rs.50 crore everyday), and is today extinct! He wanted to capture market share and play the long-term game, but he forgot the science behind ‘breaking-even.’ Binit Somaia, Regional Director, CAPA comments, “Firstly, it was tough for management to keep control of operations given the pace of expansion, this resulted in service deterioration and poor punctuality with a negative impact on the brand. And secondly, capacity grew so far ahead of demand that the options were to either fly with half empty planes or to discount heavily, both are commercially unsustainable.”

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