Category: Excerpts

Hat Tip: Jagadees

(Disclosure:I am market making in the shares of BSE)

BSE Ltd, India’s second-biggest exchange, plans to hire Axis, Edelweiss, Jefferies and Nomura as joint global coordinators for a $150 million initial public offering in India, IFR reported, citing two sources close to the transaction.

Deutsche Bank, Motilal Oswal and SBI Capital Markets will also be hired as bookrunners, reported IFR, a Thomson Reuters publication.

BSE will file a draft prospectus for the IPO by next month and plans to launch the offering before March 31, 2017, IFR added.-from Financial Express

Sunil Munjal, the joint managing director of Hero MotoCorp between 17 August 2011 (when he was named to the post) and 16 August 2016 (when he will step down), was barely involved in the firm’s day-to-day operations. None of the company functions reported to him. He was rarely seen at press conferences organized by Hero.

However, he was present (as was the entire Munjal family) at important milestones reached by Hero MotoCorp such as the unveiling of the company’s brand in 2011 or during the inauguration of Hero’s research and development centre in March.

Between 2011-12 and 2014-15, he received Rs.131.08 crore as remuneration as the company’s joint managing director, according to company’s annual reports. At least 60% of the total remuneration came between 2013-14 and 2014-15.-from Mint

We’ve had two 50% market drops in the last 15 years. Why can’t we have a third? And if it can drop 50%, why can’t it drop 75%? It can and it will ultimately. But in the meantime, all that money printing could still drive stocks higher. And central banks might take even more desperate measures to keep the game going.

The Japanese central bank is already buying stocks. It’s already bought all the government bonds. The European Central Bank is running out of bonds and government bonds to buy. Now it’s starting to buy corporate bonds. Why can’t that happen in America? Why can’t the Federal Reserve buy these assets?

When Bernanke was head of the Fed he said, “If we have to, we’ll buy anything. We’ll buy shares of gold mines.” If the Central Banks all over the world buy stocks, there’s really no top.-said Jim Rogers

And become the world’s richest man doing it.

Context:

In June 1991,India is undergoing an economic crisis with foreign exchange reserves just enough to pay for 2 weeks for imports.

PM Narasimha Rao is contemplating removing the economic shackles and reducing state control to liberalize and rescue the economy.

In the lead-up to the historic 1991 Budget, he meets industrialists including Dhirubhai Ambani.

Excerpt:

In Rao’s archives lies a printed letter in light brown paper.While unsigned,on the top right corner,in Rao’s precise handwriting, is the word ‘Dhirubhai’.The letter begins by referring to the fiscal deficit and the balance of payments crisis that India was facing.It does not suggest delicensing or external liberalization as the solution.Instead,it proposes that India raise 16,000 Crore rupees by selling the government’s stake in public sector units.

Such as suggestion would soon be implemented elsewhere.After the disintegration of the Soviet Union in 1991,the newly formed Russian republic would opt for large-scale privatization of public sector enterprises.Many of these state assets were purchased at throwaway prices by businessmen with connections to the new government.This Russian-style capitalization was more crony capitalism than genuine liberalization, and Narasimha Rao was being pressured to adopt a similar approach

-from  ‘Half Lion: How P.V. Narasimha Rao transformed India’