Not only is this confused advertising, it’s not funny in the least, and it’s in very poor taste
How can the Amul bhais make your kids devour more of their high protein paneer… which the brats usually loathe, or loathe anything that's 'healthy' for that matter? Well, one sure-fire way, according to the brand manager, is to amusingly scare the hell out of the kids. And their doting mothers.
In one commercial, set inside a shopping mall, mom and the kid are seen in action, topping up groceries in a trolley. In front of them is an India Un-shining chap (read: skinny and underfed). The kid does what kids do best in mall stores. He rams the trolley up the poor dude's backside, and the latter goes zipping across the marble flooring. The mom, instead of rebuking the kid for the prank, warns her boy that this would be his fate too if he doesn't start consuming Amul Paneer, like right away. In the other commercial, the same India Un-shining fellow is seen getting literally blown away when a table-top fan is turned on. Again, the mom points out to Mr Under Fed as a warning to her child.
It's all gone wrong out here. Not only is this confused advertising, it's not funny in the least, and it's in very poor taste. For one, the advertiser is trying to speak to both, the moms and the kids at the same time. This is dangerous stuff, as their motivations are totally different. (Mom would look for the health factor and the kids would crave great taste). And in trying to do so, it ends up pleasing no one. The slapstick humour takes the seriousness of the health story away. And the humour used is so juvenile, the kids will have a few giggles and then send people flying into the stratosphere with the trolleys inside shopping malls, but will completely miss the paneer saga. And will therefore continue to detest paneer while giving hell to people in public places. In short, bad advertising.
And worse of all, the advertising really lacks taste, whether the paneer does or not. Mocking at a malnourished man, in a country where a huge population is malnourished, is cruel and un-funny. What lesson does it impart to the already spoilt brats? That it's cool to make fun of the underfed? Should such communication be even allowed to run in the first place?
Net-net: Poor strategy. Poor creative. And totally irresponsible too.
Except for the ‘secondary corrections’, which may happen in the future, the market appears to be on the rise
There are five major factors which affect stock markets: economic, monetary, fundamental, technical and psychological. Let's look at the current market condition based on these five factors.
Technical Factors: The market is looking positive, technically. The Nifty made an all-time high of 6,357 in January 2008 from where it crashed to 2,520 in March 2009. From there, the new bull market started and it touched a high of 5,182 in October 2009.
However, it consolidated at that level, moving in a narrow range of 5% to 8% over 11 months. In September 2010, the Nifty shot out of this narrow range and is approaching an all important level of 6,130. The market might decide to correct from there or keep rising. If it does correct, it would be a boon for long-term investors because it will be a secondary correction of the primary bull market. The correction could take the market to, say, around 5,400 or, in the worst case, to 5,050. These levels would be an excellent buying opportunity. In the second case, the market would break through the important resistance of 6,130 and would very soon make a new high and, most probably, move on to close to 7,000 over the next few weeks or even months and may correct after that.
Fundamental Factors: The Sensex P/E ratio is 15.8x FY2011-12E earnings which are at a 10% premium to the long-term 10-year average. The Market-cap/GDP ratio is at 1.1x which is below its all-time high of 1.8x touched in January 2008. The earnings yield ratio of the Sensex is 5.3% compared to 8% yield on bonds (10-year G-Sec) and the earnings yield/bond yield ratio is 0.66x as compared to the long-term 15-year average of 0.88x. The Sensex P/E is at a premium of 30% compared to other emerging markets. All this indicates that, currently, the market is fully valued or slightly overvalued. Is this over-valuation justified? The positive factors which might support valuations are: GDP growth of 8% to 9%; implementation of key reforms like the GST, Direct Taxes Code and oil pricing mechanism; FII inflows; bank credit growth; boom in capital expenditure, private consumption and corporate dividend payout; and a stable political regime. The negative factors are: fiscal deficit; higher inflation; social unrest; and Maoist attacks.
Macro-economic Factors: Macro-economic factors are important in predicting long-term returns but not really helpful in predicting short-term price movements. In fact, often, it is the opposite, i.e., the stock market is the barometer of the economy and signals in advance how the economy would perform. In January 2008, when everything appeared rosy and all forecasts of the economy were bullish, the stock markets were telling us (in fact, screaming at us by hitting lower circuits) that the situation was not as rosy as it appeared to be. First, the stock market corrected and then the economy slowed down.
Monetary Factors: We are close to the end of hardening of the short-term money-market rates; long-term rates are anyway steady, which is good news for equities. Hence, currently, the monetary factors are positive as far as equities are concerned.
Psychological Factors: Unlike the last time, when the Sensex hit 20,000 or the Nifty hit 6,000, there is not much euphoria, at present. The market has actually, and literally, climbed a wall of worry to touch these levels. There has been very narrow participation. This means that we have certainly not reached a peak. Hence, the market is well placed as far as psychological factors are concerned and it has to go to much higher levels until the current fear gets converted to greed and we reach some kind of psychological peak of thoughts, words, views and action.
In sum, barring the 'secondary corrections' which might happen at the current levels or around 7,000, the market will remain bullish.
(Mehrab Irani is an investment manager with Tata Investment Corporation Ltd. He has nine years of experience in investment research, portfolio management and investment banking. The views are personal.)
A first-time customer in a property exhibition narrates his experience. Be warned, it is a sad tale
The Big Day had finally arrived. Rajiv Saxena, 28, (name changed on request) of Vile Parle in western Mumbai took a half day off from work on 21st Oct and went to visit a property exhibition at Bandra-Kurla Complex. His wife had called him five times since the morning to confirm that he was visiting the exhibition. His better half wanted to move out of the 1BHK the Saxenas were living in for five years.
But Rajiv, being shy and reclusive, was reluctant to visit the exhibition and instead preferred to talk to a broker friend. But as always, his wife had the last word. Being from a middle-class upbringing, Rajiv had first glanced at the bottom of the newspaper to check the registration fee. Rs50.
"Okay, no problem," he told himself. He arrived on time and saw some heavily-built men dressed in tight black T-shirts at the entrance. He saw no counter for tickets. He thought the newspaper might have made a mistake and smiled to himself on having saved Rs50. But as soon as he moved in, his jaws dropped. He saw a long counter from one end to another with REGISTRATION written on it in bright red.
He asked one of the men (who looked more like bouncers) with some forms standing at the counter. "Do I need to register and pay?"
"Of course," came the reply. He reluctantly filled up the form, gave his mobile number and paid Rs50, all with a grim look on his face. With a badge in his hand, he entered the exhibition. The first stall, shining with bright lights, caught his eye. As he tried to climb the steep staircase to enter the stall, he found a man dressed in a suit obstructing his way.
Rajiv looked up. The man said "Yes." Mr Rajiv thought for a moment, took a deep breath and said in a soft voice, "I'm looking to see some properties." The man replied, "Please register yourself first." Rajiv thought for a moment and said to himself, "Another registration, another Rs50."
He was greeted by three smartly-dressed ladies in white shirts and black trousers. One of them asked, "Where are you looking for the flat, sir?" Rajiv replied, "Western line". "Where in the Western Line?" the woman asked. Rajiv thought, "Oh! I forgot to ask my wife."
"Andheri," prompted the lady. Rajiv nodded. He filled up the form but he thanked God that no money was charged from him this time. He was asked to sit in a sofa until he was summoned. After 5 minutes, the same lady asked Rajiv to accompany her and meet her colleague who was supposed to assist him.
Around two-three men were already surrounding the 5ft long, 10-inch in diameter roundtable. The man spoke in impeccable English. "We have this under-construction project coming up at Mahakali Caves in Andheri and a 2BHK of 1,053 square feet. It will cost Rs136 lakh, exclusive of all stamp duties and registration charges."
Rajiv did some quick mental math and converted the figures into understandable ones. He thought, "Rs1 crore and Rs36 lakh." His mind went into a tizzy. His middle-class upbringing came to the fore.
"How much is the discount?" he asked. "No discount sir... This is an exhibition…" Rajiv felt a vibration in his pocket and pulled out his cell-phone. He expected his wife would have been calling him up to check where he was.
No, he did not recognise the number. He picked up the call. "Welcome to **** property exhibition! Have a great day!" a voice thundered from the other end. For a moment, Rajiv thought it was an automated call but the voice sounded real. He cried out, "Why are you calling when I'm here at the exhibition?" The call was disconnected. From the other end. Rajiv thought, "Thank God, it was not from my wife."
Rajiv moved on to another builder's stall. He went to a table where a lady was assisting a customer. He stood there and listened to the conversation. The lady mumbled, "Yes sir."
"I'm looking for a 2BHK property in Andheri," Rajiv said. The lady took out a brochure with an 'ongoing' project picture in Andheri and started writing on it. "Area is 1,400-1,700 square feet, loading is 26% less, Rs16,600 per square feet with Rs100 for floor rise, and March 2012 is the possession." Rajiv tried to make sense of all these numbers. He asked a simple question. "How much will it cost for a 2BHK?"
"Rs2.75 crore to Rs3crore", was the prompt reply. Needless to say, he thanked the lady and moved on.
Rajiv turned to another row and saw a queue of another block of builders. But this time, he couldn't go forward and talk. He saw smartly-dressed girls in coats with make-up smeared all over their faces staffing the reception. It looked more like a fashion show than a property exhibition, he thought.
He saw the same scene in another block. "Thank God, my wife is not here," Rajiv told himself. Finally, he selected a block which had a few people hovering around the reception. He picked up a brochure and asked a simple question, "What will be the total cost of a 2BHK in this project?"
The lady replied, "Rs30 lakh." Rajiv thanked his stars. He checked the brochure again. The project was in Virar. He dropped the brochure and moved on to another stall. He wondered, "From my place of work in Dadar to Virar everyday in the local trains. God help me."
Rajiv stood by another stall and started asking for a quote from yet another smartly-dressed lady. "We have one tower that will be ready for possession by 2013 and another within 3 months." Rajiv was interested and asked, "Any discounts?"
The lady started looking for help. She asked Rajiv, "Are you really interested?" Rajiv became nervous, "No, just asking." He wondered if they would push the deal down his throat. She asked Rajiv to wait for a while until the seniors were 'free'.
While Rajiv waited, he noticed something peculiar. The girls were reading out the quotes from a piece of paper which they had hidden under some documents. Rajiv wondered, "Were they hired today for the exhibition?" After waiting for 5 minutes Rajiv excused himself. On his way out, he saw attractive hoardings proclaiming, 10% down-payment, 90% on possession.
"Is this possible?" he wondered. A glance at one of these brochures got him interested. The pictures of the projects looked straight out of a scene from a Karan Johar film. "Real life getting inspiration from reel life," he said to himself, happy with his own cliché.
Mr Saxena's next thought was to try his luck in the stalls of the various banks and check his eligibility for home loans. He went to a bank stall and met a serious-looking official who was sitting alone beside a table.
Rajiv narrated his needs. "I need a home loan of Rs30 lakh, my salary is Rs25,000 per month." Out came out the calculator. Rajiv's eligibility for a home loan would have to be calculated first.
"On a salary of Rs25,000, the EMI is expected to be half - Rs12,500. On the basis of this EMI, we can grant you a loan of only Rs14 lakh," said the official. Rajiv had heard that the bank gives at least 85% of the loan value. "Does having broker friends help?" he wondered. The official agreed, but said that depends on the salary of a person.
Rajiv requested the grim official to club his wife's income, (another Rs25,000, he lied), to calculate the loan amount.
Rajiv was told that he would get the full 85% of Rs30 lakh then. But Rajiv was actually fudging the figures a wee bit. His wife was a freelance journalist - a good month would get her Rs13,200 per month.
Rajiv's hopes of getting a dream home were now just castles in the air. He took one last, mournful look at the real-estate 'exhibition'.
No, the saga is not over yet.
On the way out, he noticed a banner. "Book a property and walk away with an LCD TV free, but pay Rs50,000 to book it first." Rajiv was now thinking of some choice expletives which obviously cannot be recounted here.
(This is a true story. The exhibition is currently going on. And a few more dreams are being shattered, even as you have finished reading this).