Stalemate: T.P.G. Nambiar (left) and Rajeev Chandrasekhar

For Rajeev Chandrasekhar, chairman of BPL Communications, the directive from the Chennai bench of the Company Law Board (CLB) couldn't have come at a worse time. Three foreign telcos-including the UK's Vodafone and Russia's Sistema-are doing due diligence at BPL Communications as a prelude to buying a stake in it, but the bench has directed status quo in shareholding until it hears the case in April. But, as Chandrasekhar knows, it's hardly just a question of waiting for a month or so. His ongoing feud with his father-in-law and BPL founder, T.P.G. Nambiar, will certainly spill over from the CLB to one court to another. That makes Chandrasekhar's plans of roping in a strategic investor in the telco, which has licences to offer services in Mumbai and three southern states (Kerala, Tamil Nadu and Pondicherry), that much uncertain. This, at a time when the government has allowed 74 per cent foreign ownership in telcos. A BPL Communications official, however, claims that "(the company) will go ahead with our due diligence since the deal is slated to happen only in September". For TPG too, time is fast running out, since he needs to bring in some Rs 90-125 crore to salvage the JV his son Ajit, the CMD of the ailing consumer electronics company BPL Ltd., has signed with Sanyo.

-Sahad P.V.

CURIOSITY
Pre-Paid Meters

Parts of Mumbai already have it; now it is Delhi's turn to get pre-paid electricity. Manufactured by Havell's Private Limited, the pre-paid electronic meter works just like the pre-paid card in mobile phones. The consumer is alerted when the charge value drops, and replenishment coupons can be bought off-the-shelf at the utility. The advantages: Zero theft and tampering for the utility company, and convenience for the user (no misuse of power while you are on vacation). There aren't too many takers yet, but North Delhi Power Ltd. (NDPL) plans to offer 3,000 such meters in Delhi's Civil Lines, Rohini and Pitampura neighbourhoods.

-Amanpreet Singh

STATS
Jobs Update

Jobs? It's a cinch

Ma Foi's employment survey, covering 2,046 companies, for January-March 2005 reveals some interesting trends. Temping is growing, with an 11.4-per cent increase projected during the quarter. Chennai's job market is growing the fastest followed by Hyderabad, Bangalore, Delhi and Mumbai. Private limited companies are to hire more than public limited firms, and women constitute about 17 per cent of the workforce, with healthcare and ITEs emerging as the top two employers for them.

-Roshni Jayakar

The BT 50 Index
India's first free-float index, BT 50, is holding steady before the Budget.

One of the advantages of a free-float index is that it is far more responsive than other indices. True enough, BT 50 Index, India's first index based on free float has been just that since the time it was launched, although it is right now in some sort of steady state.

In early 2003, BT decided to launch its own stock-market index because of issues it had with the construct of India's two most commonly used indices, BSE's Sensex, and NSE's Nifty. Both were based on market capitalisation; that is, the weightage allotted to a certain company in the index is based on its market capitalisation. The problem: the inclusion of closely-held companies with large market capitalisation distorts the index. Corollary: the total exclusion of such companies will render the index unrepresentative. (The Sensex went free float after BT launched its index).

BT decided to adopt the free-float method, wherein the market capitalisation of a company is based on the quantum of shares available in the market for trading. Ergo, this method excludes the holding of promoters and strategic investors. However, while companies are required to furnish their shareholding pattern to the exchanges, the current format of disclosure isn't very strong-some companies have reported a free float of 100 per cent, while it is common knowledge that a major portion of the equity of these companies is held by a few strategic investors. BT discounted these strategic holdings. Free float didn't just help us choose the companies that should constitute the index; it helped us allot them weightages. To complete the methodology: the free float is according to data as on December 31, 2002; the index begins in January 2002, and its base value, like other indices is 100. All weights are updated every quarter, based on shareholding patterns. Keep tracking!

-Narendra Nathan