Companies & Sectors
Air Pegasus's Bengaluru-Madurai service soon

The third largest city in Tamil Nadu, Madurai, about 490km from Chennai, is also called as Athens of the East for its cultural heritage

 

Low-cost carrier Air Pegasus will begin flying from here to Tamil Nadu's Madurai from June 26, spreading its footprint to the fourth city across south India in its venture to provide direct air connectivity to tier-two cities.
 
"We will operate a 66-seat twin engine turboprop ATR-72 thrice a week initially on Monday, Wednesday and Friday from Bengaluru with a return flight on same day," Air Pegasus managing director Shyson Thomas said in a statement here on Sunday.
 
The third largest city in Tamil Nadu, Madurai, about 490km from Chennai, is also called as Athens of the East for its cultural heritage.
 
"We will be the sole operator to Madurai from Bengaluru with a direct flight, which will add value to the economy of the temple city," Thomas said.
 
The budget airline began booking for the new service from Sunday with tickets priced at Rs.1,234 for the 80-minute flight.
 
Taking off at 10.40 a.m. from Bengaluru, the aircraft will land at Madurai at noon. It will take off from there at 12.30 p.m. to return here at 1.50 p.m.
 
The city-based airline launched its third service to Kadapa in Andhra Pradesh on June 7 from Bengaluru after launching its maiden service to Hubbali in north Karnataka on May 12 and to Thiruvananthapuram on May 13.
 
Its parent company, Decor Aviation, has been providing ground handling services to Indian and overseas airlines from 11 airports across the country over the years.
 
Thomas said Air Pegasus aims to be a regional airline brand providing more connectivity in underserved regions and connecting non-connected sectors.
 
The company, which invested Rs.100 crore to launch the airline, with 3:1 equity-debt ratio, plans to add three more ATR aircraft to the two it has on dry lease by December.
 
The ninth carrier in the country and third to launch service after Air Asia and Vistara during the last 14 months, Air Pegasus named after the winged stallion from Greek mythology, has permit to launch service to and from any of the 22 airports across south India, connecting tier-two and tier-three cities with cities and metros like Chennai and Hyderabad.
 
Though the southern region has 30 functional airports, all of them are not connected yet, as full-fledged, budget carrier and other low-cost airlines have been operating between metros and tier-one cities only.
 

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Selection of chief executives at 5 state-run banks from Monday

A finance ministry source told IANS that this would be the first time when executives from private sector banks would be part of the selection process for top jobs in state-run banks including Punjab National Bank, Canara Bank and the Bank of India

 

As many as 26 shortlisted candidates, including executives from private sector banks, are to appear for interviews here for two days from Monday, for the posts of chief executive and managing director at five major banks.
 
A finance ministry source told IANS that this would be the first time when executives from private sector banks would be part of the selection process for top jobs in state-run banks including Punjab National Bank, Canara Bank and the Bank of India.
 
Each candidate will have to go through three sub-committees or screening committees of two members each, whose members are secretary, department of financial services, the additional secretary and a deputy governor of the Reserve Bank.
 
The sub-committees include three outside experts -- former State Bank of India managing director S. Viswanathan, Indian Institute of Management-Indore director Rishikesha T. Krishnan, and former Allahabad Bank chairperson S. Panse.
 
The final selection of candidates would be made by the appointment board chaired by the RBI governor.
 
The finance ministry had sought applications for the top posts in Punjab National Bank, Bank of Baroda, Bank of India, Canara Bank and IDBI Bank for a fixed term of three years.
 
However, it did not find an adequate number of candidates as per the criteria advertised, and, thus, relaxed the norms in April.
 

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Mutual funds or Stocks? Here’s what you need to consider
A Moneylife Foundation event focussed on whether the mutual fund route or the stock route is right for investing 
 
Investors are always confused with the question whether they should invest directly through stocks or through an equity mutual fund. Debashis Basu, editor of Moneylife, at a Moneylife Foundation event on the topic, explained major differences between stocks and mutual funds, and also which one is suited to whom. Many people tend to avoid stocks as they are considered to be riskier than stocks and more attention needs to be paid to details. 
 
“Though equity funds offer a diversified portfolio, in principle they as similar to holding individual stocks,” explained Mr Basu at the packed Moneylife Knowledge Centre. Both are volatile and can fall sharply leading to a loss of capital, he said. If one has a huge corpus to invest, over a long period of time, mutual funds turn out to be more costly as compared to stocks. The reason being, in mutual fund you pay a fee, which is a percentage of the market value of the corpus. In the case of stocks, you need to pay fixed annual maintenance charges and one-time transaction charges, which work out to be a tiny percentage amount.
 
Those who have no time and interest to analyse individual stocks or those who have a low investment corpus should go for equity funds. Equity funds would be ideal for those who are just beginning to invest and are looking to invest small amounts. However, when they gain confidence and have larger corpus, they need to look at stocks because of higher costs in staying invested in funds.
 
Illustrating this with charts, Mr Basu explained how stocks score over equity funds in terms of costs. “Costs eat in to an equity fund returns. Equity fund charge an expense ratio, which is their fees in terms of a percentage of the corpus they manage. This is deducted from the corpus on a daily basis. The fees charged can range between 1.25% and 3% per year. In percentage terms, it may seem very low, but as your corpus grows, you are paying higher fees in percentage terms and the costs for holding stocks remains fixed and transactions costs are low as compared to equity funds,” he said.
 
In terms of stock selection too, equity funds are not very efficient, Mr Basu said, adding, they (funds) stick to the same basket of stocks and are heavily weighted to their benchmark stocks. Most equity funds also have similar stocks in their portfolio. Mr Basu gave an example how nearly 86 of the 200-odd actively managed schemes hold Reliance in their portfolio. The main reason for holding this stock is because it is a heavy weight on the index. To win at stock picking, Mr Basu said that one should pick stocks with high return on capital and hold them for the long term.

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COMMENTS

Anand Vaidya

2 years ago

Moreover, the MF and its staff get paid whether the fund makes a profit or loss. They don't have "their skin in the game".

The biggest problem for small investors is to pick the right stocks and timing the entry/exit...

Chandragupta Acharya

2 years ago

Mutual Fund expenses are a percentage of the AUM. Therefore in the long run, as your investment in MF appreciates, the expenses grow dramatically AS A PERCENTAGE OF YOUR ORIGINAL INVESTMENT. This is an excellent point that I have not seen made before anywhere. Clearly, for those who can invest sensibly, direct investing is more beneficial than taking the Mutual Fund route.

Sudhakar Ojha

2 years ago

Wondering wether how to select Stocks will be a bigger problem than how to select Mutual Funds

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