Different Strokes by Sucheta Dalal

April 10, 2000

As The angel gang
After a week of panic, stock prices moved up on Thursday and zoomed on Friday — all the doing of a gang of angels. First, the FM delivered a demoralising kick to the I-T department and laid the ground for an even more volatile market. Then the big industry house pumped in Rs 800 crore. Suddenly everyone who was on the verge of going under after Tuesday’s mayhem was back in the game. Big operators did the rest. Sensex zoomed 300 points, NAVs were respectable and everyone knew who calls the shots.

Mallya’s money
‘‘Politicians want liquor money, liquor planes, liquor helicopters and liquor itself during polls,’’ aspiring politician Vijay Mallya told a newspaper. But he said they did not want him saying he was a liquor baron. ‘‘Where does the money come from?’’ Mallya reportedly asked with a wink. Mallya surely needs to think his statement a little. His liquor companies may be profitable, but the bank defaulters list has the Bank of Tokyo-Mitsubishi showing United Breweries as a loss account as of September 1998. He owed it Rs 4.72 crore. Then there is Herbertsons where Mallya invited Kishor Chhabria to acquire a hefty stake because he needed money — he is now locked in a nasty takeover battle with Chhabria. There is Best and Crompton, a blue chip engineering company until Mallya took over. It is in the defaulters list and is not paying debenture holders either. In fact, so great is Mallya’s influence that IL&FS had to sue ICICI to remind it of its duties as a debenture trustee. Finally, Mangalore Chemicals and Fertilisers, located in Karnataka, whose chief minister, Mallya alleges does not want him in politics. The company owes several banks over Rs 170 crore as of March 1999 and the clock is still ticking. Surely, the kindness to politicians has other compensations Mallya? It ensures that nationalised banks and FIs are extremely tolerant of big defaulters.

Friends and rivals
In the early 80s Nirma played David to HLL’s Goliath and blind-sided the mighty Surf to lead the volume market for detergents. In the process, Karsanbhai Patel taught the MNC a lesson that it has never forgotten — giving value to customers can create markets. HLL hit back and developed on the idea to come up with many ways expanding the market. So last week, when Karsanbhai’s Nirma Institute of Management at Ahmedabad invited Keki Dadiseth to deliver the third convocation address, he clearly saw it as a big compliment. He went on to salute Karsanbhai for what he called the unbeatable combination of seeing what others could not. This respect and admiration for a formidable competitor does not in any way diminish the ferocity of their market wars.

Fake competition
Nobody worries about the consumer unless there is competition. Ever since the TRAI allowed phone companies to meter calls every three minutes, home Internet users have been reeling under the burden of high phone bills. Over seven months ago, MTNL chairman heard us out and promised to make the Net more accessible by having a slower metering for Net connections. Nothing has happened. Clearly MTNL wants to fleece consumers until alternatives such as cable connections or Dishnet actually offer lower rates. The cellphone situation in Mumbai is no different. The two service providers have stopped competing and there is nothing to choose from between the two.

Going slowly
Remember how the June 1998 payment crisis on the BSE was hushed up? The investigation is proceeding very slowly, but one segment is particularly moving at snail’s pace —the one against former BSE vice president and Harshad Mehta crony Rajendra Bhantia. Sources now tell us that the inquiry officer (who has been given three extensions) looking into his part in the crisis has been asked to take his time over the probe.

Updated weekly.

The author's e-mail address is: suchetadalal@yahoo.com

Other columnists:

M.V.Kamath

Shashi Tharoor

SuchetaDalal

Shobha De

Amrita Shah

Nina Pillai

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