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| ING Group's Ewald Kist: high aspirations |
Hockey ace and Chairman of the Executive Board
of ING Group, Ewald Kist, 58, spoke to BT's Ashish
Gupta on a number of issues including ING's India plans. Excerpts:
The government has recently
announced that it will allow foreign holdings of up to 49 per cent
in private Indian banks, and that foreign banks can now enter the
country through the subsidiary route. Are you planning to up your
stake in Vysya, or create a few subsidiaries?
Increasing our stake is not on my agenda on
this trip so I am not saying anything about it now. We will consider
it very seriously if we feel that it will be beneficial for us.
But since we already have an arrangement with Vysya Bank, why should
we even think of setting up subsidiaries? Remember, we also have
a strategic partnership with Vysya Bank on the insurance side.
JOHN BARLEYCORN
All Bottled Up
Even a 300 per cent reduction in customs
duty doesn't make imported liquor cost-competitive. |
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After the celebration comes
the hangover. And, by all accounts, several states have conspired
to prolong that dizzy, heavy feeling the morning after. The
new import tariff structure on Bottled-In-Origin (bio) alcoholic
drinks reduces the import duty on some secondary scotch brands
priced up to $25 per case (12 bottles of 750 ml each) from
702 per cent to 413 per cent. That reduction would have made
it possible for consumers to buy a bottle of bio scotch costing
$25 a case elsewhere in the world, at around Rs 560-600 a
bottle, a steal compared to competing bottled-in-India products.
Unfortunately, most state governments are flouting WTO norms
that prohibit them from levying excise if bio products pay
federal taxes. But state governments are cleverly garbing
excise duty in the form of special fees. Result? bio scotch
remains more expensive than the BII scotch. That sure is a
spirited way to keep competition at bay.
-Moinak Mitra
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Do you think that the 26 per cent foreign
equity cap in the insurance sector is far too low?
I am fine with it. There is nothing wrong with
having a majority stake for the Indian partner. However, the government
should gradually increase this to 49 per cent as it has done in
the banking sector.
What is ING's focus as far as banking in
India goes?
We are trying to become a universal financial
institution. We are involved in a variety of activities-banking,
insurance, asset management, etc. But there are many areas where
we are still not allowed.
What kind of investments are you looking
to make in this country in the next five years?
I am not sure of the exact figure, but we have
spent tens and thousands of Euros in India already, and will have
to wait for five-to-six years before the money comes in. So we are
talking about big money down the line.
Do you ever regret buying Barings?
No, not at all. We bought the bank for only
one pound plus the liabilities, but the kind of publicity that we
got actually made up for everything.
ECLIPSE
Empire Of The Sun
A little less than four years
is all it has taken Surya to dethrone Asianet in the Malayalam sat-chan
market.
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| Sun's Kalanidhi Maran: Knowing what works
in Kerala |
They're
overly fond of motion pics down south. so, all Sun Network's Malayalam
channel Surya TV had to do to steal audiences away from first-mover
Asianet was to play the m-card. With television rights to most motion
pictures made in the past two decades that wasn't difficult. Then,
following the established programming strategy of building soaps
around other best-selling programmes, Surya launched mega-serials
like Manasaputhri (Daughter of the heart) and Porutham (Compatibility).
Numbers stand testimony to the effectiveness
of this approach: for the week ended February 24, Surya boasted
24 of the top 30 programmes in C&S (Cable and Satellite) homes
in Kerala and a weekday viewership of 22.4 per cent as compared
to Asianet's 15.9 per cent. ''For the last six months we have consistently
increased our ratings,'' says S.J. Clement, General Manager (Programmes),
Surya tv. That increase is reflected in the channel's advertising
revenues, up 20 per cent over the past two months. Today, Kerala-based
advertisers alone spend Rs 3.5 crore a month on airtime on Surya.
Even as Asianet prepares a counter-offensive (like commissioned-for-television
motion pictures), Sun is considering launching a 24-hour Malayalam
news channel. But hey, where's the 'm' in news?
-Nitya Varadarajan
SUGAR-DADDY
Sugar Power
A Pune scientist wins a prestigious award for
what looks like alchemy.
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| Anand Karve: fuel from hitherto-unsung
sugarcane leaves |
Fuel
from sugarcane leaves? That isn't as bizarre as it sounds. Indeed,
the concept has won a Pune scientist Anand Karve one of the world's
most renowned awards in the field of renewable energy, The Ashden.
For 63-year-old Karve, the honour that goes
with the award is a bonus, but it is the £30,000 award that
will allow him and his scientific society, the Appropriate Rural
Technology Institute (ARTI), take the idea places. Karve first considered
the idea of using sugarcane leaves to make fuel briquettes around
three years ago. His daughter Priyadarshini, a scientist herself,
helped perfect the concept and ARTI ended up with a utility for
the hitherto-unsung sugarcane leaves (even cattle do not deign to
eat them).
Although ARTI is a not-for-profit organisation,
Karve and his team hope their idea will bring economic gains to
both the rural farmer and the poor urban family. ''We calculate
that farmer and his family can make Rs 75,000 a year by making briquettes,''
says Karve. ARTI will train them to do so, and use the prize money
to start marketing the bricks in urban Maharashtra. ''For the urban
poor this would be a cheaper source of fuel since we hope to sell
the briquettes to retailers at Rs 7 a kilo,'' adds Karve. With Maharashtra
accounting for close to 40 per cent of India's sugarcane produce,
that's a win for both town and country.
-Anjali Cordeiro
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| PwC's Ian Coleman: the valuations guru |
Q&A-2
''Valuations Affect Everybody''
The litigation surrounding the ICICI-ICICI
Bank merger once again brings practices surrounding valuation in
India under the microscope. PricewaterhouseCooper's Global Product
Leader (Valuations & Strategy), Ian Coleman was
in India recently to address a seminar on the subject and spoke
to BT's Roshni Jayakar. Excerpts
INDIA'S FIRST REAL E-COM COURSE
Designed by Intel, two e-com courses live
on in Karnataka. |
|
E-com should be a four-letter
word now. after all, isn't that the way the Indian psyche
works, swinging from one extreme to the other? But even if
real e-commerce has proved a non-starter in India, two Intel-designed
courses are thriving, the first at Bangalore's Indian Institute
of Science, and the other at Karnataka Regional Engineering
College at Suratkal. Both institutes boast e-com labs funded
by Intel. For KREC, e-com was a value-add. For Intel, said
Mani S. Kantipuddi, head of Intel India Development Centre,
this was an opportunity to work with KREC to ''build an e-commerce
curricula that would meet industry requirements''. The company
plans to launch a programme with the Bangalore-based Indian
Institute of Information Technology to take the course to
more than 80 engineering colleges. Still think e-com is dead?
-Venkatesha Babu
|
On the importance of valuations: People
tend to think of valuations as being a technical issue, but with
so many people having their pension and savings invested in stocks,
valuations affect everybody.
On valuation methodologies: There is
a debate on whether the market can be a true representative of value
or if earnings give appropriate signals. However, the discounted
cash-flow method and real option valuation are gaining in importance.
On real option valuations: Real option
valuations are relevant in situations where there is uncertainty.
For instance, in the case of pharmaceutical companies engaged in
R&D, we attach probabilities to different options so as to build
a picture. Value is not a single point, but a probability distribution
of various points.
The need to increase the scope of regulatory
coverage on valuations in India: There is a need for specific
standards for valuations. Adherence to these standards should be
enforced by regulatory agencies. Someone like the Securities and
Exchange Board of India can come up with a framework possibly with
matters like number of valuers, circumstances under which valuations
are to be done and so on.
BUBBLE
Thirsting For Summer
The two cola majors are slashing price, pushing
distribution, launching variants, and praying for a hot summer.
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|
Pepsi's Rajeev Bakshi with Shah Rukh
Khan at the recent launch of Pepsi Aha
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This
much noise this early in the season may be wholly unprecedented
in the CSD market, but for the Rs 5,500-crore carbonated soft drink
industry still reeling under last year's sales drought, summer 2002
is the season of reckoning.
Coca-Cola India (CCI) threw down the gauntlet
by relaunching 200-ml versions of all its offerings. It also slashed
prices of its 1 and 1.5 litre pet bottles. And it seemed to have
scored a promotional coup over Pepsi with its association with the
popular Popstars programme on Channel V. Pepsi caught on fast: first
it launched what is globally Pepsi Twist (a twist of lemon) as Pepsi
Aha; then it announced a back-to-back calendar of events including
concerts by sophomore favourites Pink Floyd and Deep Purple, a Punjabi
Pop Talent Hunt to counter Popstars, and broadcast sponsorship of
the Indian cricket team's tour of West Indies and England. And apart
from launching new campaigns, the companies are also speaking of
possible flavour variants.
The weather gods could help their cause. Temperatures
in March were three-to-four degrees higher than normal, according
to the Indian Meteorological Department. The rising mercury, coupled
with the accelerating tempo of marketing, may just bring in the
30 per cent growth rates the two companies seek so desperately.
Unless, the weather decides to take a turn for the better.
-Shailesh Dobhal
OSCAR
Leveraging Lagaan
Should Star get an Oscar for best marketing?
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|
Star cashed in on the Lagaan hype
|
Lagaan
may not have won an Oscar but it has certainly done the Star Movies
channel a good turn. One, the channel managed to sell all 30 minutes
of advertising time available on the three-and-half hour live broadcast
of the Oscar ceremony. And two, leveraging the interest surrounding
Lagaan's Oscar nomination, Star took a hitherto niche-programme,
the Oscar coverage, mass. The promos, in Hindi to boot, and built
around Lagaan helped. ''We used it (Lagaan's nomination and Star's
live coverage) as a peg to build the Star Movies brand,'' says Raj
Nayak, Executive Vice President (Advertising Sales), Star Network.
Advertisers seem to have bought Star's story about this year's coverage
reaching a mass audience: four out of the nine main sponsors of
the live show were mass marketers-Asian Paints, Bajaj, Pepsi, and
Parle. Star wasn't exactly forthcoming with how much it made from
the show. As for ratings, we'll have to wait until April
-Shailesh Dobhal
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