Thought Leadership

Much has been claimed about UP’s development. It is the singular pitch of the current dispensation’s estimated Rs 50-crore-per-day advertising campaign promising to make UP a $1 trillion economy, parroted from PM Modi’s presentation to BRICS in 2019 …

Read more at: https://www.deccanherald.com/opinion/up-s-race-to-nowhere-2885077

…the banking system in India, overall, is taking easier routes to make its money insidiously from vulnerable segments of the population and the industry that are hungry for debt to sustain their living, and veering away from the more difficult core banking business that would help fuel the Indian economy. And they are doing so quietly and opaquely. Here are just four examples…

Using valuation to buy companies that are in a much lower multiple and putting it all together to make an ‘Action Defining Logic’ entity with a monster value was a strategy that was working and logical for the edtech company in that heady world of acquisition-led and fund-infusion-based valuation fantasy, before taking the company public and placing the monkey of that overvalued monster squarely on the shoulders of believing, FOMO retail investors.

…My questions to Madhabi Puri Buch, the Chairperson of SEBI, are these:

Where is the potential for wealth creation for the retail investor if valuations are 10-times the industry median? Would SEBI have allowed the listing of the parent at $22 billion or the offline subsidiary at $4 billion if the can of worms hadn’t ope…

Hindenburg was accused of having a vested interest on every news channel — that the company significantly benefited in bringing down Adani share prices. Look at the timing, they all said. Point is, of course, that short sellers have a vested interest. The better short sellers do extensive research and then seek value in betting their own money against overvalued stocks and sectors. Short selling brought about the downfall of the housing market that brought down the global economy in 2008. Was Michael Burry, the short seller, jailed or labelled an anarchist?

…..The Adani Group is not a company without value. It has real assets in the form of ports, airports, power transmission, etc. This matter could well be more about fugazzi and opportunism than it is about being a fraud like Enron. The company has two options…

…So the euphoria around India’s largest IPO is justifiable but hardly targeted at the original owners of the mutual company who after the IPO will approximately get just 50 shares a piece. The Euphoria swirls around them but targeted to benefit the current owners….

….Why would the market only heavily discount the most dominant life insurance company in India, while valuing the private insurers more favourably despite the “adverse” market conditions? Has the LIC been deliberately undervalued? It seems to be, as it must be “attractive” for the private buyers and the ‘NEW’ owner, (who together own 98.5% of the company) who will now would reap the upside of a deliberately undervalued listing that was not theirs to start with the retail investor earning the upside of just approximately 80 shares a piece at the IPO price. This was never about creating wealth for the retail investor. From where I stand, it seems to be a story of greed in a game played by the owners and bankers, akin to the Casino Royale being played out by the same category of players in the PE funded industry.

Hung or lost wars that result in economic bankruptcy have led, time and again, to regime change — from the Greeks stretching themselves too thin to the East, to more recently the British Empire, Hitler’s Germany, and well, the Soviet Union… The economics that backed Putin’s decision to go to war is more obvious than, say, the calculus of Hitler’s Germany. For one, Russia is one of the large producers of fossil fuels, contributing 11% of the world’s oil…

Is Putin banking on the West to blink on the altar of self-preservation and let Russia off the hook? It is possible when the rhetoric dies down and new lines are drawn. It is perhaps the reason why everyone went out on a limb to play down Biden’s statement.

This dichotomy between real income and valuation-based net-worth income has led to a peculiar shift in the way money is earned and invested today, changing the demographic and the mindset of the ‘entrepreneur’ with serious, though unmeasured, consequences… About 90% of what gets consumed in our continent-sized economy flows through “trade”, or traditional distribution….
But from a systemic viewpoint, the long term is important, and we must not shy away from the reality, which is this: India has over 12 million retail outlets, most of them being small family-run stores; 11% of the Indian population, or over 150 milli…

…..“It’s a damn conspiracy, and everyone’s in on it!” – Jailor Norton, The Shawshank Redemption. Paper money is being made at every level by every player, where companies are bought and sold amongst themselves for paper value. They all gamble on a hypo…

It is easy to drive viewership, and therefore revenues, by ‘performing’ before the camera. The return on investment (ROI) earned is staggering. The direct cost of a byte-sized news story at breaking time is roughly just Rs 28,000…