Share prices will continue to drift lower: Wednesday Closing Report

Nifty headed for the first support of 5,340, subject to a minor rally

The market opened with small gains taking cues from the Asian bourses which were up in morning trade. The Sensex opened 40 points higher at 18,177 and the Nifty added nine points to its previous close to resume trade at 5,448. The indices rose to their intra-day highs in initial trade, with the Sensex at 18,218 and the Nifty at 5,461. The market could not retain the gains and hovered near the neutral line in the absence of any triggers. A bout of selling in frontline stocks around noon pushed the indices lower.

The oil & gas sector was the top loser, following reports of a directive from the oil ministry asking Reliance Industries to drill two wells in the KG-D6 block by next month and another nine by the end of the fiscal, to raise gas output. Higher crude prices also weighed on the sector.

The market touched the day's low in noon trade, with the Sensex losing 116 points to 18,021 and the Nifty dropping 38 points to 5,401. Recovery attempts in the post-noon session were shot down by institutional sellers, which ensured that the indices stayed range-bound in the negative. The market restricted its losses today, but still ended in the red for the third straight day. The Sensex closed 51 points down at 18,086 and the Nifty shed 18 points to settle at 5,421. The advance-decline ratio on the National Stock Exchange was 425:968.

The Nifty fell below its first support of 5,450 today. The fall is acquiring strength now and the next support to watch is 5,340.

The broader markets took a bigger hit today as the BSE Mid-cap index ended 0.61% lower and the BSE Small-cap index declined 0.80%.

The BSE Oil & Gas index (down 1.88%) continued to languish as the top sectoral loser. Other losers were BSE PSU (down 1.77%), BSE Healthcare (down 1.40%), BSE Auto (down 0.98%) and BSE Realty (down 0.92%). The BSE IT (up 0.24%), BSE Fast Moving Consumer Goods (up 0.20%) and BSE TECk (up 0.12%) were gainers.

Among Sensex stocks, HDFC (up 2.34%), Hero Honda (up 1.93%), Maruti Suzuki (up 1.75%), Wipro (up 1.71%) and Tata Power (up 1.50%) were the top performers. Reliance Infrastructure (down 4.11%), Tata Motors (down 3.36%), Reliance Communications (down 3.31%), SBI (down 2.40%) and Jaiprakash Associates (down 2.23%) were the losers on the index.

The government has decided to include natural gas and fertilisers in the list of core sector infrastructure industries, a move that will help capture the performance of the economy in a better manner.

Currently, the government evaluates the performance of six key sectors-crude oil, petroleum refinery, cement, electricity, finished steel and coal-on a monthly basis. The new series, which will have data for eight key sectors, would be released on 10th June.

Markets in Asia closed higher on a weak dollar and strengthening of commodity prices. Japanese stocks advanced on the back of banks and utilities.  Mizuho Financial Group Inc gained 3.2% in Tokyo, on reports that it plans to merge its retail and corporate banks. Cnooc, China's biggest offshore oil producer, gained 2.2% in Hong Kong, while PetroChina Co climbed 1.7% as crude futures rose as much as 1.1% from a three-month low in New York today.

Besides, China's annual housing inflation slowed slightly in April with prices rising 4.3%, a further sign that forceful policy tightening is helping to cool exuberant price rises.

The Shanghai Composite gained 0.70%, the Hang Seng rose 0.48%, the Jakarta Composite surged 1.08%, the KLSE Composite was up 0.33%, the Nikkei 225 advanced 0.99%, the Straits Times added 0.15%, the Seoul Composite jumped 1.59% and the Taiwan Weighted settled 0.68% higher.

Back home, institutional investors were net sellers of equities on Tuesday. Foreign institutional investors offloaded Rs487.20 crore and domestic institutional investors pulled out stocks worth Rs570.29 crore.


How to avoid 'get-rich-quick' schemes and scams

There are no free lunches, no easy money. Yet people often become victim of ‘double-your-money’ or ‘earn-lifetime-income’ schemes. Here’s how to identity and avoid such MLM schemes

Nothing comes free in this world, especially money. The universal truth is you need to earn your money by hard labour all the time and there are no shortcuts to double it in the shortest span of time. Therefore, even if your near and dear ones tell you he/she will double, triple, quadruple your money within a few days/months, politely reply to them that it is not possible and what they are advocating is a pure 'get-rich-quick' type of scam.

How does one judge whether a scheme is genuine or a scam? It's simple. Check the interest rate being offered by banks, especially public sector banks like the State Bank of India, Union Bank of India, Bank of Baroda, and so on. At present, these banks pay 4% interest a year on savings bank accounts. Second, check the interest rate on the public provident fund (PPF). Currently the Employees' Provident Fund Organisation (EPFO) controlled interest rate on PPF is at 8% and for the Employees' Provident Fund (EPF) it is 9.5% per annum. Many people consider investment in EPF/PPF as the best and safest debt instrument.

The interest rates offered by banks and EPFO are an indication of the viable minimum and maximum expected returns on investments. In other words, you could say that your investment should give you a safe return of a minimum 4% and a maximum 9.5%, at least in 2011.

Therefore, anyone or any scheme that offers you more than this must be looked at very carefully and a thorough scrutiny must be done before investing one's hard-earned money. Unfortunately, this happens rarely, as most of the time the person approaching you with a high-returns scheme is either your close relative or a friend, whom you find difficult to say no. Remember, all scams, frauds that have happened in the past are known to have spread through the link of near and dear ones.

The first rule on investments is that if you do not understand how the instrument works don't sink your funds into it. This applies to all schemes that promise 'guaranteed income' and 'fast and huge returns' within a short time. In financial investment terms all such schemes are huge risks.

Now let's see how a multi-level marketing (MLM) company operates. An MLM, or pyramid selling scheme, typically requires you to pay upfront charges for either joining the scheme or buying a product or service (like collector's items or software, training programmes, e-zine etc). As more and more people join the MLM scheme, a member hopes to recover the upfront charges and then earn sizable profit through binary income. However, history tells us that all such MLM companies have failed miserably and vanished with investors' money after running out of new recruits or investors (a new 'bakra'?). Most of the time, the person who recruited many others himself becomes a victim of the scheme.

First, the agents, distributors, panellist and customers of the MLM companies try to convince the new recruit with bogus claims about earning huge money. If the recruit does not seem interested, they introduce terms like lifetime income and royalty payment through binary activity. All MLM agents pretend to help you earn big money. Unfortunately, it is he who ends up with the money, leaving more than a few penniless. When the binary income plan fails, recruits have had to go into hiding from the newer entrants.

This has happened so many times before, that MLM operators have found it necessary to advertise in order to allay the fears of new recruits, often engaging sellable brand ambassadors in the popular media. This is the "Fake it, till you make it" system, that's common among MLM operators.

Another important aspect is that once someone gets involved with an MLM company, he begins to strongly advocate it, irrespective of whether he likes it or not, and even if his inner self says it is wrong. The reason is he doesn't want to come out as being fooled by someone, and will pretend to have made a 'smart' choice by buying into the MLM scheme. So most agents will tell you that they are always right and they know everything and all others (who are not joining his MLM) are morons.

In addition, MLM systems are a massive net loss for a country, as they distract people from doing real productive work. All products or services sold through an MLM network are either worthless, or not beneficial to common people. The products offered under the pretext of herbal medicine, cure from diseases, medicine or collector's items such as gold coins, are often useless. In fact, the medicines sold under the garb of herbal products may even harm you and endanger your life. It is the same with other products as well.

The Moneylife team decided to look for other MLM schemes that are proliferating across the country. We found that a large number of companies, with varying degrees of legitimacy, many of them with a global footprint, are raising money or selling obscenely expensive products, by creating a high-reward matrix that is built on luring new distributors/depositors/buyers into the scheme. More importantly, each of them grows by roping in people who enjoy high public trust, such as doctors, bankers, reputed sportspersons, government officers, senior corporate executives, or their spouses, and sometimes even god-men.(Read more Money Chain  )

Remember the GoldQuest scam?  It was a chain-marketing scheme that used to sell limited edition gold coins, figurines or watches for Rs30,000 to Rs35,000. According to news reports, in May 2008, after receiving 8,277 complaints of cheating from many people, especially from South India, the Chennai police arrested GoldQuest's managing director and six other employees. The company ceased to exist, leaving 2.66 lakh of its independent representatives without any commission. Finally, last year the Supreme Court appointed Justice KP Sivasubramanian as settlement commissioner of a one-man commission, for the GoldQuest case.

Unfortunately, there is no legal provision in India to curb MLM schemes. However, Singapore, the headquarters of Speak Asia Online Pte Ltd, which hit the headlines recently, does have strict laws on MLMs. Under the Singapore Multi-level Marketing and Pyramid Selling (Prohibition) Act, all persons who participate in multi-level marketing or pyramid selling are treated as offenders who had committed an offence. This is because the participants would have played an active but destructive role to attract others into the scheme. The Act believes that this is the best way to deter potential promoters of such schemes.

According to the Ministry of Trade and Industry, Singapore, a conviction under the Act will result in a fine of up to $200,000 or imprisonment for a term not exceeding 5 years, or both. The fines are for:
1. Promoting or participating in a multi-level marketing, or pyramid selling, scheme or arrangement.
2. Registering a business which is designed to promote multi-level marketing, or pyramid selling scheme or arrangement.
3. Registering a company which proposes to promote multi-level marketing, or pyramid selling, scheme or arrangement.

In addition, the Singapore Act empowers a Court that convicts a promoter or participant of a multi-level marketing or pyramid selling scheme an additional penalty of an amount not exceeding the amount or value of any benefit which the promoter or participant has received. This additional penalty ensures that the Act serves as an effective deterrent to potential offenders.

However, since the Indian government has not taken any stand on the legitimacy of such network marketing or MLM companies, such schemes get replaced with other schemes and the entire cycle is repeated because the allure of instant riches through such Ponzi schemes is everlasting. 

You may also want to read...




5 years ago

I started a blog on how difficult it is to make money using these SCAMS. Anyone who signs up for these programs after reading my break-downs of commission plans, deserves to lose all of their money!!!


5 years ago

Speak Asia, Nano Excel, Tycoon International, Visarev & Unipay2u – biggest scam is on its way


5 years ago

before investing in money chain companies one should read the judgement of supreme court in kuriachan chacko Vs state of kerala case. One must also read the press note issued by Andhra Police. Please also visit to see the complaints against money chain companies

Krishna Gopal Gupta

5 years ago

It is very good indeed to learn that you are enlightening people not to fall into the trap of such MLM Schemes. But what about IRDA, under whose nose, Future Generalli insurance policies are being sold by Big Bazar, Max New York policies are being sold by Amway. LIC policies are being sold by many MLM companies. Bajaj Allianz policies are being sold by RMP infotec and the list is endless. The relevant insurers are in full knowledge. Since they need business, they are keeping silence including IRDA, who is also fully aware of all these and is waiting to happen a big scam?


5 years ago

Its very simple to understand:
1. The MLM companies like SpeakAsia want you to make more and more members.
2. They use the money from new joinees to pay others ans keep the major part with themselves.
3. They pretend to give you some stupid survey, product etc and tell that this is what generates money (which they pay to you)

Now here are the validations:
1. Would any company like ICICI, Bata, Nestle etc pay Rs.500 for a survey to be done by a complete novice?
2. None of these companies are accepting of ever hiring Speak Asia's services.
3. No financial background of such companies.
4. Its operation is busted in other places like Bangladesh where they have reached ssaturation.
5. No operation in countries with strict financial laws like US,UK etc.

Rem one thing, you may like to join the ride, and it can be rewarding, but for how long, is the main question. This will go bust one day and majority of new joinees will be at loss.
So even if you want to join SA, use your leisure money, something you can afford to lose in a high risk and 'expected' high return...

Baaki koi nahi, sabko apna faisla lene ka poora haq hai. Also, MoneyLife is a very big name when in comes to warning investors, so their opinion should be taken seriously. Like me, I guess most of you too would have come across ML articles on SA by regularly visiting ML website. And we visit ML website because we have trusted it for long...

So guys, its a NO from me too, but you can take your pick


5 years ago

In Kerala MLM (known as Money chain) business is mushrooming. Recently a company called NANO EXCEL; a Bangalore based company looted the Kerala People. They have reportedly amassed more than 600 crores from Kerala. Now their office in Kerala (Thrissur) has been closed. No telephone calls are attended. Inspector General of Police, Thrissur Range, Ms. Sandhya cautioned people against this company. But still nothing has happened. No arrests have been made so far. And it is surprising that the company is still functioning in Bangalore!!!!!! It is open secret that many politicians and policemen are behind this company. It is joke in Kerala that there are no petty criminals now in Kerala, they have all started an MLM – money chain Company and have become Managing Directors.


5 years ago

Very informative article. Every internet marketer needs to read this!


5 years ago

great work man. Hope people will now not lure the innocent relatives into such schemes.

Madhusudan Thakkar

5 years ago

Please go through following link for more information.

Airport operators sit on valuable public property, avail of concessions, but will not be accountable

RTI activist Sanjay Shirodkar has been working to bring Mumbai International Airport Ltd (MIAL) under the RTI Act, since 2007. MIAL has resisted all orders, even going to the High Court on the matter. Shockingly, the public Airports Authority of India (AAI), which has a stake in the company, has defended the private agency. Similar battles are being fought in Bangalore and Delhi

One day, while waiting at the Chhatrapati Shivaji International Airport for his cousin to arrive, Sanjay Shirodkar noticed a number of cars belonging to various 'embassies' parked outside. He asked security agency personnel and designated traffic police why the cars were allowed to park there for such a long duration, when other vehicles were not permitted to stop there for more than a few minutes, only allowing travellers to alight. But he got no answer.  Mr Shirodkar was also hassled about the high price charged for mineral water at the airport stalls. That was back in 2007.

Mr Shirodkar proceeded to write a letter to the Mumbai International Airport Ltd (MIAL) as well as the Airports Authority of India (AAI) seeking information under the Right to Information (RTI) Act, about the mineral water price policy. He received a reply from the deputy general manager of AAI, quoting an internal note from the legal department, saying that "MIAL will not come under the purview of the public authority and thus the provisions of this (RTI) Act will not be applicable to MIAL.''

Mr Shirodkar says, "I was shocked that the public department, the AAI, which has a 26% stake in the public-private partnership (PPP) and has allowed the use of 2,000 acres of its land-which amounts to at least Rs50,000 crore-was actually protecting the private agency, MIAL, instead of monitoring it and ensuring that it performs its duty transparently, and it was encouraging the agency to keep information away from the public domain.''

Undeterred, Mr Shirodkar invoked a second RTI query on 15 November 2007 with regard to the rules for parking of vehicles. He asked:
> Is parking free for all embassy vehicles at all airports in India? If yes, then please give a copy of the government resolution (GR) or any such notification to show this.
> At which furthest point can embassy vehicles be parked from the terminus?
> Is there any privileged parking facility for embassy vehicles when the ambassador/high commissioner is in the car, or for the staff of the embassy as well?
> Please provide a list of all embassy offices and their respective official number plate details (by which they are recognise for privileged parking, if applicable).

The reply from AAI on 26 December 2007 said that embassy vehicles could go only up to the designated VIP area where they can park free of charges. This implies that they were not permitted to park outside the airport terminal for long durations.

This set Mr Shirodkar thinking about public-private partnerships which have become the backbone of several large-scale (read, large money), development infrastructure projects. More so in the case of airports, which are sensitive areas in the context of the threat of terrorism, how was MIAL flouting the basic rules on parking? He, therefore, decided to find out what concessions MIAL enjoyed from the state and central governments.

In an RTI query, dated 17 November 2007, Mr Shirodkar requested information from a number of related government departments at the Mantralaya state headquarters, including the General Administration Department (GAD), and whether AAI had offered/provided any discounts/concessions/exemptions/waivers to MIAL on interest  free debt, entry taxes, property tax, lease of land, stamp duty and registration charges, change of land use, octroi and road cess, if any.

All departments kept mum for months, till a fortnight back, when the GAD replied stating that "MIAL has been given a stamp duty concession of Rs250 crore and it operates on 2,000 acres of government land.'' Now, is this not sufficient premise for MIAL to come under the RTI Act, with such "substantial funding from the government," Mr Shirodkar asks.

Interestingly, in the case of the Delhi airport, which is also privatised under the banner of Delhi International Airport Pvt Ltd (DIAL), Lt Col Anil Heble (retd), an RTI activist and resident of Delhi, filed two applications on 12th June and 15 June 2006 with the public information officer (PIO) of the Ministry of Civil Aviation for information related to the construction of a new security wall in place of the existing wall in Shahabad Mohamadpur village.

The PIO, Ministry of Civil Aviation, forwarded the applications to various PIOs of the Airports Authority of India, New Delhi. When Lt Col Heble did not receive any reply, he filed a complaint with the Central Information Commission on 19 July 2006.

The bench of the then central information commissioner (CIC), Dr OP Kejriwal, ordered that DIAL abide by the provisions of the RTI Act. The decision read: "The Commission heard both sides. DIAL responded saying that they were not a public authority as they held a 74% stake in the joint venture company set up by GMR. On making further inquiries, the Commission was told that the government had a 26% stake in DIAL.

"The Commission is of the opinion that a holding of 26% is quite substantial for any company and therefore, Section 2(1) which states that any body owned, controlled or substantially financed is a public authority, is applicable to DIAL and hence it is bound by the directions of RTI. The Commission therefore directs DIAL to provide for the directions of the RTI. This must be done within 15 days of the issue of the order.''

Mr Shirodkar had made a similar appeal to the CIC. The order of 11 June 2008 was predictably, ditto as in the case of Mr Heble. "In an identical case, in respect of Delhi International Airport Pvt Ltd (DIAL) the Commission vide its decision dated 17 January 2007 has observed that a shareholding of 26% is quite substantial for any company and therefore Section 2(1) is applicable to DIAL…'' Accordingly, MIAL "is covered under the definition of public authority and is therefore directed to furnish the information asked for within 15 days from the date of issue of the decision.''

In yet another case, Bangalore resident Benson Isaac also appealed to the CIC regarding the Bangalore International Airport Pvt Ltd and on 14 May 2008, KK Mishra, state information commissioner, Karnataka, gave a ditto verdict.

But, MIAL did not take the CIC's order lying down. Advocates Duttmenon Dunmorrset filed a writ petition in the Delhi High Court in 2008, challenging the decision of the CIC, and pleading that it be exempted from the provisions of the RTI Act since it has 74% stake in the PPP. The High Court recently directed the matter back to the CIC, Sushma Singh.

As of 16th May, Sushma Singh has sent the copy of the GAD's official reply to Mr Shirodkar; and has asked MIAL to reply on the 26% "substantial'' stake by the AAI in MIAL and that MIAL is using 2,000 acres of land belonging to the government.

This is just the tip of the iceberg in PPPs that have become an integral part of India's progress. Check out for an idea of the magnitude of such projects.  Surely, we need transparency, and not official secrecy, as has been the case since the days of the British Raj.

(Vinita Deshmukh is a senior editor, author and convener of Pune Metro Jagruti Abhiyaan. She can be reached at [email protected].) 




5 years ago

Very true words by Bidup. Yes, on my trips from Delhi, even when the AI does not show the courtesy of offering a free glass of complimentary water while making passengers wait for hours, I had to buy water, having compulsorily thrown the bottle brought from home! Only in India can this audacity be permitted, without any law court yet having taken suo moto cognisance of this naked contravention of human right and forced extortion from passengers, mostly Indian citizens. And the govt. merrily permits this!


5 years ago

They have paid bribes in billions to buy off, inter alia, generations of top bureaucrats to do anything they deem fit. Nothing can be done about this. That is why, a person's water bottle is removed at the gate and, if thirsty or water is needed to take medicines during long and indefinite hours of waiting, the person is compelled to buy water at a rate 20 times costlier than in an ordinary shop. There is no MRTO for these sharks. They own all they occupy--they are as powerful as the rulers. Or, they are the rulers!


5 years ago

The PPP model itself to give away large part of public land to the private companies - its same with Road, Airports or bridges.

Before these privatised airports, the airports by AAI are running are same quality - no difference.

Aurobindo Banerjee

5 years ago

Where is the question of accountability in an acquisitive, graded and hierarchical feudal "civil society"busy trying to reserve seats for the chosen few in a farce called Lokpal? After all, in a permissive set up run by an elitist rule, these operators clearly enjoy tacit support and patronage of the Minister, ministry and the bureaucracy as well as the state CMs. Otherwise all this could never have happened. There is no concept in India of "class action" and these operators are doing everything openly without resortiong to any subterfuge as the bureaucracy and its political bosses are in the dedicated pay roll of the former. So, there is nothing surprising-rather only expected in the land of Fodder, Bitumen, Posco, CWG. 2G, NAFED, Stamp Paoper, Loyttery scams like hundreds of filthy episodes involving (understandably) the politicians as a class and the IAS as an interest group and a power lobby which actually "runs" the government. This is a country where big business, mafia (including the mining mafia of BJP-sponsored Karnataka and a family-sponsored AP, the family-run 2g venture, the Congress party-run CWG scam) have been openly looting the country with impunity by taking the route of velection-funding of all parties, but the real peril lies in the most surreptitious stranglehold of the IAS who have been consistently plundering the country keeping the politicians as their junior share-croppers!
So, one should think a hundred times before pointing fingers at businessmen who are openly in the business of money making NOT for charity!


5 years ago

Cheating and fraud is a part of the airports development.
One on hand these operators are claiming that their model is unviable because of high development costs (and hence increase fees of passengers and airlines), yet they themselves are buying their partners for huge sums of money for controlling stakes.
Parking charges are obscene in mumbai airport. There are no clear directions as to where a person has to go. The new parking lot if very far and system is such a person has to take slip while going in. It takes 10 min to park & is so far from the departure that just to go and come takes 20 min. So by the time you are our of the parking lot and show the slip, more that 30 min pass and you are poorer by Rs 130.
For arrivals, you can only stay for 5 min or the meter is running & space is only for 15 cars.
I feel that by the time the airport will be ready it may be cheaper to park a aeroplane than a car.
God help us from such developments.
Free govt land and subsidies are used up for monopoly infrastructure projects.

Whats even worse is that GVK and GMR do not reflect these profits. Even a dumb person can make money in such conditions !!

Who earns the profits (of high parking for cars and planes ) ??!!!

M Prasad

5 years ago

All the airports in India where sheduled services are operating are licenced by DGCA under public use license.

Hence views of DGCA should be obtained on the Issue

nagesh kini

5 years ago

The issues raised by Vinita are very apt
1. The vehicles flauting yellow CD in Delhi and CC elsewhere, red topi safed sarkari gaddis, vehicles hired by PSUs - "GOI undertakings", "On BMC duty" break traffic laws with impunity. this ought to be curbed.
2. It is convenient for any authority to fob any RTI query by stating that are not covered. At the Anniversary of the RTI Bombay High Court Justice Dr. Dhananjay Chandrachud validly suggested that even the private sector should be answerable under the RTI.


5 years ago

Thank you for this detailed report. It seems that a few more flanking rti applications will have to be filed by other people.

# an rti application to pmo asking them for information on free facilities if any asked for from bial / mial / dial by the pmo.

# an rti application to moca asking them for information on free facilities if any provided to pro from all airports in India.

# an rti application to mea asking them for information on free facilities if any asked for from all airports in India on behalf of diplomats in India, and information under which rules or laws.

# an rti application to bcas asking them for information on relaxations in security of diplomats and diplomatic vehicles if any at all airports in India.

I request people reading in to do these and simply follow up on responses so that these responses, whatever they are, come into the public domain. This will , in turn, impact the position that moca takes in the high courts.

Nitin Kirtane

5 years ago

This is a important issue and some higher up people like our dear ministers seem to have some inside deal on selling our airports for peanuts , good luck to Mr shirodkar with this issue and thks to Mrs Deshmukh who continues her fight against corruption , good luck


5 years ago

Commendable Efforts !!

Sarabjit S Kahlon

5 years ago

I appreciate hard work put in, this will definitely pave the way to opening flood gates of many such entities impeding RTI act, and fighting tooth nail to remain unaccountable and non-transparent.

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