Indage Restaurants & Leisure, although loss-making, is not as over-leveraged as Indage Vintners. Will it also be hurt by the likely liquidation of the parent company?
A 15-day stay on liquidation proceedings granted by the Bombay High Court has given Indage Vintners a ray of hope to raise funds and find a way to survive. However, investors are now beginning to question the future of Indage Restaurants & Leisure, its sister company that runs a number of restaurants which used to showcase Indage’s wines.
The management of the family business was divided between the Chougule brothers—Ranjit Chougule was in charge of the wine business and is believed to be responsible for the over-ambitious borrowing and global acquisitions, while Vikrant Chougule runs the more conservative restaurant business.
Indage Vintners owes several banks nearly Rs200 crore, say media reports, and is on the verge of liquidation. Its fate will probably be decided in a fortnight when the Bombay High Court stay is vacated. The question is, will the relatively unhurt Indage Restaurants & Leisure also be affected by the problems of the wine company?
This company runs restaurants, night clubs and lounges like IVY, Athena, Tetsuma, Hotel Shalini Palace, Nandos, Prive, Tamaara, Zaha, Tiger Hill and had even acquired a pizza chain, Garcia’s Famous Pizza. The restaurant business has been struggling for the last couple of years and net profit has tanked from Rs3.11 crore in March 2008 to a loss of Rs12.35 crore in March 2009. However, it is not hugely leveraged.
According to a former employee, there is a lack of communication within the Indage Group and also lack of financial accountability. “The company lacks vision, plus it doesn’t do any market segmentation for its businesses,” he said. It is also clear, from talking to investors, that the two brothers do not see eye-to-eye—most certainly after Indage Vintners began to flounder.
Curiously though, the Tiger Hill brand, launched by the wine company, is marketed as a product designed and promoted by Kavita Chougule, the wife of Vikrant Chougule. Sources say that the family believed that Kavita was a high-profile socialite and had the right public profile to brand the wine. Clearly, this was delusional; the brand made no waves, although the wine was fairly good.
According to our source, when Tiger Hill was launched, there was a lack clarity with regard to the marketing and distribution which resulted in a further dent in the company’s financials. Today, several of the restaurants are believed to operate on property that is either owned by the family or by the wine company. It is not clear how these would be affected in case the company is liquidated.
Sources say that the Chougules are still trying to bring in investors to save the company, but with little success.
In 2008, around 250 employees of Indage Vintners quit the company after not being paid. Indage has not been making payments to its suppliers and service providers since the beginning of 2009. Soon afterwards, it stopped paying its employees, forcing some of them to approach the police.
In June 2009, Indage Restaurants & Leisure announced that it would consider raising finances by issuing equity shares or warrants on a preferential basis for an amount not exceeding Rs50 crore.
In early 2009, it planned to franchise its two ventures—IVY and Athena—by joining hands with Franchise India Holdings Limited (FIHL) to open multiple IVY and Athena outlets using the franchise route. None of these plans have fructified, since the parent company began to flounder.
Earlier, the same hackers had also hacked into a number of Indian websites, including that of Tata Institute of Social Sciences, samachar.in, wonderfulindia.com, sptravels.in and mergersindia.com
Some hackers allegedly from Pakistan hacked Taxila.in and Taxila.info, websites of Jaipur-based Taxila Business School. The hackers calling themselves ‘Doctor Neo’ and ‘Doctor Dan’ from the 'Pakistan Net Army' changed all pages from these websites.
Earlier, the same hackers had also hacked into a number of Indian websites, including that of Tata Institute of Social Sciences, samachar.in, wonderfulindia.com, sptravels.in and mergersindia.com.
The hackers replaced Taxila photographs with offensive photographs and added obnoxious text like: *“Dear Admin Dont Hate us...Hate Your Weakness*...” and images with the logo of the ‘Pakistan Net Army’, and a burning Indian flag.
According to media reports, the management of the Taxila Business School has registered an FIR against the hacker at local police station in Jaipur.