Videocon Mobile: Sound strategy, fun ads

The new commercials playing on the fears of prepaid users should evoke laughs; the idea is highly campaignable

I look out for mobile phone adverts with a great deal of curiosity. What can one do in a category where all's been said and done, where all routes have been exhausted? Videocon Mobile has released new commercials for prepaid users.

Encouraging them to opt for a plan. And they have come up with the correct strategy, I must say. The mobile marketer highlights the fear that the pre-paid chaps constantly have of running out of talk-time. Especially when they need it the most.

Once this particular strategy is decided, one can produce a thousand hilarious adverts, and that's what Videocon Mobile seems to be doing. And looking at their first few commercials, I must say they have done a pretty decent job.

The commercials feature movie comedian Ritesh Deshmukh. (On a bitchy note, good for the dude. Obviously he has been doing a cool job of being a funny man in Bollywood flicks for Videocon Mobile to hire his services. Not being a fan of the trash that Hindi films dish out in the name of humour, I always thought young Deshmukh was getting the sidey roles due to his parentage.) In one commercial, a man is seen dying, as he makes a frantic call to Ritesh, who's travelling in a train. To tell him that he (the dying gent) is not his real dad, and that the title belonged to another man. But before he has a chance to reveal the identity, poor Ritesh's talk-time gets over and the call gets abruptly disconnected. To add to his misery, the newly turned lawaaris spots a random man in the train who looks like his dad. Yup, the commercial is funny. And Ritesh does a good job of a man doomed not to know who gave him birth, for the rest of his life.

The other one I saw has the actor playing the role of a geeky porn surfer. As he downloads the image of a topless woman, his pre-paid balance gets over just as the image is about to reveal the, er, critical parts. And the phone goes dead. Yup, quite funny.

All in all, good work. The correct strategy (feeding on a pre-paid user's main worry) and a humorous take on situations. Should evoke laughs and people will recall Ritesh Deshmukh's various miseries. And yes, the idea is highly campaignable. And it's good to see the marketer experiment with a fresh face, because quite frankly, it's now become tiring to watch the same ol' Bachchans and the same ol' Khans.


Utilities: Religare says PLFs up; Macquarie finds fuel concerns rule investor mindset

 In two separate reports, broking firms Religare and Macquarie talk about rising PLFs in October and concerns of global investors about fuel supply risk and the increasing losses by state electricity boards. Both agree that merchant power prices will be under pressure

In a recent report to its institutional clients, Religare Research has said that the PLFs (plant load factor) of private power plants has shown strong improvement, but that in absolute terms, public sector power plant PLFs continue to be higher. "Average thermal PLF of power companies under our coverage increased to 84.6% in October versus 75.3% in September. Private power plants showed the strongest improvement at 76.3% against 64.8% in September, while the PLF of central power plants increased from 77.5% to 86.5%," Religare said in a report dated 10th November.

Adani's Mundra plant PLF improved to 91% in October versus 81% YTD. Jindal Steel & Power's Tamnar plant's PLF improved to 103% versus just 75% YTD. Lanco's Kondapalli and Amarkantak plant showed a 5% and 16% improvement in PLF, respectively, while its smaller Aban plant showed a 24% improvement. NTPC's Korba, Rihand, Faridabad, and Kawas plants showed improvement too.
However, in NTPC's case there was also a drop in PLF at quite a few of its plants. "NTPC's coal-based plants (~25.3GW) averaged 88.6% and gas-based units (~4GW) remained at 73.1%," Religare said. Reliance's Rosa plant improved only slightly. Tata Power's plants showed virtually no improvement.

Religare said OTC prices for Oct/Nov/Dec are expected at ~Rs 4.62/4.65/4.75 per kWh-virtually unchanged from September. While merchant power volumes continued to rise, the trend in tariffs continued to be downward. Prices of coking coal (Newcastle, South Africa) have been rising, while freight rates have picked up sharply since June.

Macquarie has said that most investors it met with recently in Asia, Europe and the US to talk about Indian utilities, were underweight the sector on concerns around fuel supply risk and increasing losses by state electricity boards.

In its report dated 10th November, Macquarie said that after the Coal India initial public offer investors have become very aware that there is a widening demand-supply gap for coal in India and that coal linkages are clearly not enough-a case in point being Lanco's 600MW Amarkantak project which has had to resort to e-auctions despite having linkages with Coal India. The brokerage perceives sole reliance on coal linkages as a big risk and as such finds NTPC in a precarious position.

Among the power companies positively placed in terms of fuel supply security it has called attention to Adani Power (since its parent is the country's largest coal trader, is a coal producer, and a greenfield asset owner and contract miner), and Tata Power since it is "the only utility with a net-long thermal coal position (17-19mtpa to FY17)."

On the losses by state electricity boards (SEBs), Macquarie said that the 13th Finance Commission Report projected state transmission and distribution power losses at $26 billion by FY15. "This weighs heavily on the SEB's appetite to acquire more expensive power as more merchant volume is fed into the power market. Macquarie Research and power traders we spoke too think this will continue to put pressure on merchant power prices-look for greater volume exposure than purely pricing exposure."

(This article is based on secondary research. The report is for information only. None of the stock information, data and company information presented herein constitutes a recommendation or solicitation of any offer to buy or sell any securities. Investors must do their own research and due diligence before acting on any security. Some of the opinions expressed in this article are the author's own and may not necessarily represent those of Moneylife).


Monday’s Market Preview: Flat-to-positive opening likely

The Indian market is likely to witness a flat-to-positive opening on the back of mixed global cues. Wall Street ended sharply lower on Friday as the Group of Twenty (G-20) meeting failed to come up with any constructive understanding at the end of two-day meeting over the weekend. Markets in Asia were mixed despite higher-than-expected gross domestic product (CDP) numbers for the September quarter. The SGX Nifty, which opened strong, pared early gains and was just 1.50 points higher at 6,085.50 compared to 6,084 on Friday.

The aftermath of the festive season proved costly for investors as global cues, weak domestic industrial growth numbers for September and mixed earnings reports trashed the indices last week. Pullout by foreign institutional investors also weighed on the markets. The Sensex and the Nifty both closed with cuts of around 4% on a weekly basis.

Markets in Asia were mixed in early, despite better-than-expected GDP numbers for the September quarter. GDP rose an annualized 3.9% in the three months ended 30th September, following a revised 1.8% expansion in the previous quarter, the Cabinet Office said in Tokyo today. In nominal terms, the economy grew 2.9%.

The Jakarta Composite was up 0.04%, the KLSE Composite gained 0.19%, the Nikkei 225 surged 0.71%, and the Seoul Composite was up 0.32%. On the other hand, the Shanghai Composite declined 0.85%, the Hang Seng fell 0.01%, the Straits Times was down 0.46% and the Taiwan Weighted fell 0.88% in early trade. The SGX Nifty, which opened strong, pared early gains and was just 1.50 points higher at 6,085.50 compared to 6,084 on Friday.

The US markets declined on Friday again to end the worst week in the last three months. With the Group of Twenty (G-20) summit of not much use to the US as it failed to persuade world leaders to come up with plans to strengthen global growth, the markets ended lower. The markets also took a hit from the Chinese market as the government there said that the pace of inflation hit a more than two-year high in October, raising speculation that China would hike rates to ease inflation. The Dow tumbled 90.52 points (0.80%) to 11,192. The S&P 500 declined by 14.43 points (1.18 %,) to 1,199. The Nasdaq fell by 37.31 points (1.46%) to 2,518.

In a late night development on Sunday, controversial telecom minister A Raja submitted his resignation after being ordered to do so by his party, DMK, in the wake of allegations that he caused a loss of Rs1.76 lakh crore to the exchequer while allocating second generation (2G) spectrum two years ago.

The resignation was submitted after he returned to Delhi from Chennai where he met the party chief and state Chief Minister M Karunanidhi twice in the last 24 hours.

Prime minister Manmohan Singh is expected to handle the telecom portfolio in the interim period till a new minister is appointed, sources indicate.


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