Hush-hush tales from the world of stock markets, banking, corporate world and corridors of power
Last Updated: May 11, 2022 / 08:04 AM IST
Rumour has it that a top executive of this startup which is notorious for its high pressure and churn is embarking on a long sabbatical, and it is not certain if he will return. Until a few months ago, this executive used to be the face of the company, vociferously defending its strategy and fielding media criticism. It remains to be seen if he will return from his sabbatical, considering a couple of others who took this route never returned. Guess the idea is that once you are out of sight and out of mind, the going will be easier for this firm, which is often in the spotlight for the wrong things.
POCKET OF TURBULENCE
Here’s a nugget which fell from the skies! We hear that a particular airline is expected to face some serious backlash from customers after the aviation regulator suspended several of its pilots from operating a particular aircraft model. A few weeks later, the regulator also started a probe into the airline’s flights. We hear that these probes by the regulator are fast hitting the reputation of the airline and customers have even started changing flights to avoid flying with this carrier. The industry is abuzz with chatter that the airline’s market share may be up for grabs in the coming few months due to its image taking a beating.
Buzz is that a luxury mall spread across half a million square feet may come up in the most expensive retail location in the capital city of India. This would be developed under the public-private-partnership (PPP) model. The developer selection is underway to construct the project and manage it on a Build-Operate-Transfer (BOT) model. A little birdie told us that one of the desi conglomerates with a multinational presence is in the race to bid for this prestigious project which is likely to be ready within two years.
NOT WHAT THE DOCTOR ORDERED!
A leading private healthcare professional, who is a senior member of various healthcare associations, was recently asked by the government to stop writing in newspapers about nearly 20,000 medical students from Ukraine who had to return to India in the wake of the Russia-Ukraine war. This doctor, who operates a chain of hospitals in southern India, had been pleading with the Centre and states to adjust the students in private medical colleges in the country. The government, however, is in no mood to make any such exception for the students and informally asked the doctor to refrain from making pleas that were “unjustified”.
CURIOUS CASE OF MISSING METRICS
These are challenging times for consumer-facing companies so much so that the top listed players in the sector are now hiding key performance parameters, something they had eagerly shared for several years. Earlier this year, the master franchisee of a top QSR company in India stopped sharing its same-sales-stores growth. The development even found its way to the report of an analyst with a top brokerage, which wondered about the reasons for the ‘non-disclosure’? More recently, another analyst at a global brokerage firm raised questions about a top FMCG company’s recent practice of leaving out parameters such as ‘volume growth’ or ‘margins’ while reporting earnings. The CEO of the company, however, brushed off the concerns saying these parameters are not significant.
A W'HOLCIM' QUERY
Recently an industrialist known for his wit and humour posed an interesting question to the government and the press on social media. He quipped: "The government/journalists need to find out why a successful MNC like Holcim is selling their very profitable interests in ACC/Ambuja and walking out of India. The answer could be quite telling!" Well, over and above exploring overseas regions with better margins and lesser competition, there is chatter on the Street that the probe being carried out by the anti-monopoly watchdog may have also weighed on the Swiss parent before opting for the exit route.
SMALL IS BEAUTIFUL
Shifting focus now to Deal Street. The healthcare space has seen a lot of M&A action of late with new deal launches wherein PE funds are looking for an exit or entire hospital chains are on the block. The latest one being the exit of ADV Partners from Dr Agarwal’s Health Care and the entry of TPG. That's not all. Now word is that a prominent hospital chain is considering a string of pearls acquisition strategy and is currently eyeing the buyout of a series of smaller targets in multiple geographies — north, west and south India. Guess it’s taking a cue from its more active peers.
BETTER LUCK NEXT TIME?
It has been a series of back to back "hard luck" situations for this medical devices player if the grapevine is to be believed. So it was eyeing an IPO earlier and didn't get the desired valuation. Then it slashed its valuation we are told. Even then the demand was insufficient and hence listing plans were put on the backburner. Finally, there was buzz of a potential deal with an MNC but apparently even that has hit a wall. So what next? Beats us!
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