Part 2 of our 'Word on the Street' column, which gets you the unreported chatter from the world of business and markets, put together by our fly-on-the-wall reporters and editors. Read Part 1 here.
Always loyal to Goyal
Since Jet Airways shut shop on April 17, most of its 20,000-odd strong workforce has joined the competition. They can hardly be blamed, having gone without a salary since March. But there are hundreds of them who still continue with the airline. One of them is an octogenarian from south of the Vindhyas, who has been with founder Naresh Goyal since the first day of the airline in the early 90s. There are plenty of tales about this senior executive who was Goyal’s trouble shooter-in-chief for everything (official as well as outside of office). This person has formally retired from the organization many years back, but has steadfastly been by Goyal’s side in a consulting role since then. Insiders say one reason could be that the gentleman in picture simply knows too much to be left to his own devices.
One of the topics in the Jet Airways' office grapevine used to be the little temple this person has in his workspace. Of all the deities that adorn the temple, the biggest picture is none other than that of Naresh Goyal. One can’t say of other Jet fliers, but this loyalty program may still fetch reward points.
Ambitious Big Daddy
The Big Daddy of insurers, who was recently forced into a shotgun marriage with a state-owned bank now seems to be keen to make the most of the forced matrimony. Of course, Big Daddy was brought kicking and screaming to the mandap, but had tacitly been promised some concessions by the father of the bride to soften the blow. Talk is that the banking regulator will give Big Daddy an extended deadline -- 10-12 years -- to lower its stake in the bank. The insurance regulator, too, is expected to be equally lenient with its deadline. Big Daddy does get away with a few things that peers can’t. (Check out its stakes in ITC and L&T despite calls by the regulator to prune those). But then, he has always been called to help whenever the government of the day was in a tight spot.
The problem right now is not about the concessions that the banking and insurance regulators may offer Big Daddy. Problem is that Big Daddy has developed some serious banking ambitions, and is hoping that by some change in rules he will be allowed to retain the current stake in the bank. Remember, not long back, he had applied for a banking license, but had been turned down.
Battered in Eveready
The steep fall in the Eveready Industries stock over the last three weeks is said to have wrong footed some of the smartest investors on Dalal Street. After crashing nearly 60 percent from its peak during January to October last year, the stock had stabilized in the Rs 180-200 range over the last six months. Then started murmurs in the market sometime in late March about liquidity problems being faced by the promoter group. The company’s disclosure in mid-April that its promoters had pledged additional shares further unnerved investors, causing the stock to nosedive. When asked by stock exchanges about the sudden collapse in the share price, the company clarified that it has been making all the required disclosures and would continue to do so. But the 53 percent drop in share price in three weeks is leading the market to suspect that the malaise could run much deeper. Those who had made big bets on the stock include a flamboyant market operator, an ex-star fund manager with spiritual leanings who is now running his own venture, and the co-promoter of a leading NBFC-cum-real estate group.
Silent Operator’s big idea
It is far from clear who will emerge the victor in the bruising telecom war, and for that reason, there is little excitement over shares of telecom companies. But for some of the savvy investors, this is a good time to accumulate shares as they are more likely to get them at a reasonable price. The recent Vodafone Idea rights issue did not create much of a buzz, but the Silent Operator is said to have bought a few hundred million shares through rights renunciation, in addition to what he was entitled to.
The eye of the beholder
Does the government have an audit team in place to check on the prices at which auctioned goods are sold off? Does it have a system of tracking the end beneficiaries of these auction purchases?
These questions swirled in the minds of art savvy people when they found that the recent auction of high-value paintings of a fugitive diamantaire got the government a price close to 10 percent of their market value. The market value is determined by the average price other paintings of the artists concerned, fetch in the market place.
So were the beneficiaries of the discounted sales people close to revenue officials? Or does one have to climb the ladder still higher?
Hamdard’s pains
The start of the Muslim fasting month of Ramzan brought into notice the absence of a summer drink that is closely associated with the iftaar ritual: Rooh Afza.
Chatter in the market is that the reason for the shortage is the ongoing feud between family members for control of Hamdard, the trust which makes Rooh Afza. Hamdard issued a statement that Rooh Afza had gone missing from the stores because it was unable to procure a key ingredient.
But Hamdard dealers are sceptical of this explanation, pointing out that supplies of many of its other products have dried up since November last year.
Interestingly, just a few days after the media and Twitter storm, Hamdard seemed to have miraculously procured the missing ingredient, as it said Rooh Afza was back in production and would soon be seen on shelves.
(Contributed by Prince Thomas, M Saraswathy, Santosh Nair, RN Bhaskar and Nazim Khan)
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