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Fair representation?

First, let me inform you that I am one of your biggest fans and of Sucheta Dalal. I think that Moneylife, as an institution, is doing great work in creating financial awareness amongst the public. I am highlighting a few of my observations about the stock recommendation on Insecticides India in Moneylife (18 October 2012). The title says debt-free balance sheet (this attracted my attention to the recommendation). In the last paragraph, it said that its status is almost debt-free at 0.21 times. However, when I referred to the annual report of Insecticides India, it shows a debt of Rs43 crore long-term and Rs115 crore short-term—totalling Rs158 crore against a net worth of Rs182 crore, i.e., a debt/equity ratio of 0.85x. Only if we consider long-term debt to equity, it is 0.21x as mentioned in the report. But is that a fair representation? Also, the debt (long- and short-term) has increased from less than Rs35 crore last year to Rs158 crore this year; the report fails to mention this.

 
The report does talk about the dividend payment of 25% of face value but, as you also know, the real barometer is dividend as a percentage of profits and not of face value. In this case, it is as low as 11% and, even in the past, there is no great picture. 
 
I am not trying to highlight mistakes in the recommendation or the report. I am bullish on the Indian agri-space and I think all these companies have a long way to go. All I am trying to do is provide a better representation of facts.
Amit Bagaria, by email  
 
We have considered only long-term liabilities in the debt:equity ratio. So the figure came to 0.21. The debt equity ratio looks higher by including short-term liabilities of Rs115.15 crore. — Editor
 
Politicians’ profit
Moneylife is a very good magazine. The report titled prime minister’s tough love was very apt. The coalgate scandal has shaken the nation to its roots. Yet, it is only a fraction, compared to the sea of government scams in the mining of raw materials, building of huge dams, the MGNREGA (Mahatma Gandhi National Rural Employment Guarantee Act), the NRHM (National Rural Health Mission), roads, electricity distribution, RTO (Road Transport Office), etc. 
 
Has all the investment and expenditure made by the government brought betterment in society? The nation has surely achieved ‘success’—in making life more difficult for the common man and in the destruction of flora and fauna. Today, the question is: Has the national wealth been used for national welfare? The answer is ‘no’. Instead, a few pockets are being lined at the expense of the nation. National wealth is being exploited without any accountability. More important, the loss is being recovered from the 99% of Indians who work very hard to earn their living. How is it that only 1% of the population, including politicians, have made so much wealth in so short a time?
Avinash Kundu, by email  
 
Laptop servicing
My CROMA brand laptop was pending delivery after servicing since 27 September 2012. I was assured delivery in a week’s time after servicing. Even after repeated reminders, this has not happened. On my last visit, I was assured it will be given positively by 18th of October. Unfortunately, this too has not happened. I have been a loyal customer at various Tata outlets for long. Also, I had visited CROMA showroom thrice with complaints after the purchase, for servicing. I could not leave the laptop at the service centre because I was informed that it will require at least a week’s time. As I am a social and RTI activist, I need to have the PC; it is crucial for my work. I had spent a fortune for keyboards, mouse and USB hubs, at regular intervals. Also, I am a senior citizen (76 years). Despite my earnest request to provide me with a temporary instrument because of my need, CROMA ignored my pleas and did not provide me with a temporary replacement.
SH Subrahmanian, by email
 
Our columnist V Raghunathan replies:
You should write to the customer service of CROMA India (http://www.cromaretail.com/Laptops-C-20.aspx) and write to them in detail complaining about the dealer. CROMA is a Tata enterprise and you could also, for good measure, send a letter to Ratan Tata as the chairman of all Tata enterprises to the Tata Sons address. In all likelihood, you will get a response and help. If they are not responsive, start a chain mail campaign, asking each of your friends to forward it to all their friends. This will bring it to the notice of CROMA. These are the only ways we can fight them.
 
I think you could also file an online complaint with a consumer court, though my personal experience is that our consumer courts are also tragically indifferent to online complaints. We do live in a country where the common man is perennially fighting the authorities in different garbs. 
 
Nexus among leaders
I had the golden opportunity to listen to you at Kochi. Subsequently, I have subscribed to Moneylife. Now, in addition to Moneylife, I also get your daily newsletter, covering important day-to-day affairs. I read your article “The New Political Nexus”. The extent of corruption of our leaders makes one’s blood boil. But we are unable to do anything. What can we do? How can we protest against this collusion and loot? 
B Rajendra Babu, by email
 
Nice article
Your article (Moneylife, 1 November 2012) on Robert Vadra was really good. It also covered many other aspects of real estate/ share market corruption. 
AK Srivastava, by email
 
Inspiring Memory
Dr Verghese Kurien (1921 – 2012)
 
Thanks for an inspiring tribute to Dr Kurien (Moneylife, 4 October 2012). It rings true of the man I was lucky to meet. Few of us are like Dr Kurien. But if each of us tries to act like him, we can achieve a flood of success in human and agricultural development.
– Bruce Scholten, by email
 
The lessons we can learn from this great man are simply invaluable.
– PA Joseph, by email
 
I was delighted to read about Dr Verghese Kurien in Moneylife. How vividly you have portrayed the life of Dr Kurien and what a role model he was; he was so focused and lived for others. He has left a legacy which very few can match. I am going to preserve your write-up as part of my collection of profiles. 
– Dolphy D’Souza, by email
 
 
Disturbing signals
This is with regard to “Not much help from RBI even in 2013?” The quick predictions about the future have confirmed the extent of external pressure on India to conform to certain prescriptions. The government’s helplessness in such situations has found expression in the transfer of stress to RBI (Reserve Bank of India). This time, RBI managed to withstand the pressure and stick to its perceptions. This was possible because governor Dr Subbarao and deputy governor Subir Gokarn were in a position to defend their considered views. The way in which the finance minister responded to RBI’s stance sends out disturbing signals.
MG Warrier 
 
Done the wrong thing
This is with regard to “Rajat Gupta’s life after his insider trading conviction” in Crosshairs by Sucheta Dalal. The reason why the judge said that Rajat Gupta is a good man who has done the wrong thing, is that no evidence has so far been uncovered to prove that he benefited by providing inside information to Rajaratnam. However, giving the information was a crime!.
Ashok Visvanathan
 
Pay up MVAT?
This is with regard to “VAT on sale of under-construction flats in Maharashtra: All you need to know” by advocate Mohana Nair. Great article; but builders are pressuring buyers to pay up MVAT (Maharashtra Value Added Tax). Most of the ad hoc committee members are approaching the builders to understand the calculations before taking the decision to pay. As such, once paid, no refund will be given by the builders, if the Supreme Court overturns or modifies the high court order. In Pune, builders are collecting 5% MVAT on payments/ instalments made after 20 June 2006. Formation of cooperative societies is still pending and they keep stalling for some reason or the other. What is a common man suppose to do? As a buyer in April 2006, except the down payment, all other payments are charged to us. 
Doshi
 
People get lured
This is with regard to “MLMs continue to loot and scoot while police, regulators act like mute spectators” by Yogesh Sapkale. It is strange what money does to people and what people can do for money. These types of MLM or Ponzi schemes are difficult to identify at an early stage. They attract attention only after they have grown in size significantly. We cannot call such MLM or Ponzi schemes as investments and those people who get lured by such schemes as investors.
Nilesh Kamerkar
 
Fine analysis
This is with regard to “Best Equity Funds in the September 2012 quarter.” A very fine analysis.
Vikas Gupta

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