Indage Vintners goes into deep-freeze

Troubled winemaker’s bank accounts seized by sales tax department for non-payment of dues to employees

India’s oldest winemaker Indage Vintners, we learn, has not been making payments to suppliers and service providers ever since the beginning of this year. In a business that is dependent on a big public profile, the inability to pay its dues was the first indicator of how cash starved it is. Soon afterwards, it stopped paying employees, forcing some of them to approach the police. It was the vision of Indage's founder Shamrao Chougule that brought quality wine and champagne to India and it is his dogged effort that led to the discovery that large parts of Maharashtra have the perfect climate and soil to produce quality wine grapes. However, when it comes to running its operations, the group has always had its sharp peaks and troughs.

Several years ago, the company was pulled out of a financial mess through a generous restructuring of loans. This allowed it to take full advantage of the boom in wine sales that coincided with five years of India's blazing economic growth until 2008.

However, a series of over-zealous international acquisitions that went sour, expensive new brand launches and the prolonged lull in the market following the economic slowdown of 2008 have put the company’s finances in a precarious position again. In May, Indage closed down several regional offices and stopped accepting supplies from its several small wineries. Soon its market position began to decline and its nearest competitors, Sula and Grover began to eat into its market share.

Earlier this week, Indage landed into even more trouble after the West Bengal sales tax department seized its bank accounts for non-payment of dues. Apparently, any balance funds remaining in the account as on September 2009 were remitted to the sales tax department.

Moneylife had been trying to contact the company management for the past few days, but no one was willing to respond to our queries about the state of its finances. Vickram Chougule directed us to speak to his brother Ranjit Chougule, who did not respond to our calls. Earlier, Indage’s senior management had sought to play down employees’ fears saying the financial situation was only a temporary aberration and that the company would soon come out of it.

Sanket Dhanorkar [email protected]
 

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    COMMENTS

    C Buckenham

    10 years ago

    Our company is owed substantial sums by Indage Uk guranteed by Idage in India. The company is clear that it intends to hide behind the Indian legal system delays rather than honour its debts and uphold its promises. The Uk entity is udner voluntary arrangement but having alienated its Uk supply base and lost but all of its customer base; its hard to continue believing the spin its Direcors provide in the face of the financial crisis it is actually in. It is sadening that the entoty has bene allowe dto build an empire of such financial growth without the underpinning or controls that a stock exchnage listing would suggest.

    C Buckenham

    10 years ago

    Our company is owed substantial sums by Indage Uk guranteed by Idage in India. the company is clear that it intends to hide behind the Indian legal system delays rather than honour its debts and uphold its promises. the Uk entity is udner voluntary arrangement but having aligneniated its Uk supply base and lost but all of its customer base its gard to continue believing the spin its Direcors provide in the face of the financial crisis it is actually in.

    This is the age of 'compact' vehicles
    When Tata announced the launch of their small, compact car 'Nano' priced at Rs1,00,000, many raised questions about the sustainability of such vehicles. Many were worried over Nano's small size and its capacity to carry a load of four fully grown people. Nano answered most of the criticism and now many companies are eying the 'compact' vehicle segment.

    While Premier Ltd, the maker of the ubiquitous Mumbai taxi, is making a comeback of sorts again, with its compact sports utility vehicle (SUV) 'Rio', Mahindra and Mahindra Ltd (M&M), has launched a new compact truck 'Gio'.
    Mumbai-based Premier has been absent from the passenger car segment after Fiat Uno and the failed collaboration with Peugeot in 2001. The company also tried to make a comeback in 2004 with a new diesel van called Sigma, loosely based on the Mitsubishi Varica from the 1980s.

    At first glance, Premier's new offering Rio looks more like a small car, mostly Maruti Wagon R or Skoda Fabia on big wheels. But it can accommodate four adults. Rio is a re-incarnation of Daihatsu Terios mini-SUV of late 1990s vintage. China-based Zoyte Auto bought the rights of Daihatsu Terios and renamed it Zoyte Nomad. Premier, in a deal, will bring the entire vehicle, sans the drivetrain in India as completely knocked down units and after fitting its own, modified Peugeot TUD5 diesel engine, will sell it as Rio.

    Rio is priced between Rs5,25,000 and Rs5,95,000 ex-showroom Pune and is available in three variants. Premier plans to produce 500 units of Rio per month till March 2010. But at the same price, you can get a better built, second hand Scorpio, so whether the reincarnation of Premier would be successful or not, only time will tell.

    On the other hand M&M, India's largest utility vehicle maker has launched a new compact truck Gio. M&M said Gio is the country's first four-wheel 5 tonne compact truck priced at Rs1,65,000. Gio comes with a 9.1HP Kohler engine and the company claims it gives a mileage of 27km per litre.

    "As city limits gradually expand and distribution needs increase, the Mahindra Gio presents a high earning potential for customers who will benefit from its high mileage, low maintenance cost, optimum utilisation of space and low acquisition cost,” said Dr Pawan Goenka, president, automotive sector, M&M, in a release.
    Although both Rio and Gio are different from each other, their launch signals the coming of age for the 'compact' bug, originally started by Tata Nano.
    -Yogesh Sapkale
    [email protected]
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    IOL Netcom in dire straits, claim employees

    Disgruntled employees allege IOL Netcom has been withholding salaries since January 2009, allegedly due to cash problems.

    All is not well at IOL Netcom Ltd, an IPTV and Internet services company based in Mumbai. An ex-employee of the company complained that his salary has remained unpaid since June 2009. He reveals further that a lot more employees have not been paid their dues since January 2009. Several have left the company due to non-receipt of salaries.
     
    A detailed search at consumer complaints forum website (www.consumercomplaints.in) threw up a whole list of similar complaints from disgruntled employees. They claim that the company has no funds to make the salary payments and that the figures mentioned in the company balance sheet are made up. The company balance sheet shows that the salaries are being paid. The company is also reporting profits for the June quarter, when employees are claiming that it is absolutely cash crunched. The company had reported losses for the past two years. In FY08 its net loss stood at Rs25.57 crore while in FY09 it suffered loss of Rs14.05 crore. The ex-employee also alleges that the company president, Siddhartha Srivastava, is turning a blind eye to the grievances of the employees.
     
    When Moneylife contacted a senior official at IOL Netcom, he said the salaries had remained pending merely due to factors related to recession. He said, "There is nothing much to it. Given the recession, many companies were facing a tough time and we are also passing through that phase. On an overall basis, we are getting into a strategic investment mode where a few weeks from now a strategic investor is taking over. Nobody would have invested if they had no confidence in the company. Everything will work out pretty soon."
     
    What is IOL Netcom and why are its problems newsworthy? It is the same controversial company that made news as owners of a 1% stake in Reliance Infocomm when it was part of Mukesh Ambani's empire. A certain Ashish Deora, a partner of the late Pramod Mahajan's relatives in the same company (then known as IOL Broadband), was under investigation in 2002 after being allotted one crore shares of Reliance Infocomm at a nominal one rupee per share. This was allegedly a quid pro quo for various permissions granted to the company to launch a Wireless in Local Loop (WLL) service, without paying the appropriate fees. However, the said shares were cancelled on the claim that he had not completed the work, but IOL walked away with the expensive fibre optic network that was laid in Mumbai and Delhi.

    The company website is apparently in shambles and has been down for quite a while, showing signs of abandonment. The company's services too are fraught with issues. One particular complaint talks of low quality service with connectivity issues and server breakdowns. Notwithstanding the strategic investor claims, the company seems to be in a very bad shape.
    - Sucheta Dalal with Sanket Dhanorkar  [email protected]

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    COMMENTS

    ErSS Hari

    9 years ago

    your story on cranes software was very brief since that stock is falling daily average 10 percent.kindly publish a detailed report what is inside story.co is beyond control of sebi and nse.loos there is deep conspiracy.

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