/* Google verification tag */ Indian School of Business: January 2007
Indian School of Business

Taking a break from blogging

Hai friends,

Due to my busy schedule in preparing my strategy for my career change from government to private sector, I could not post for the last 10 days. I may not blog for another two to three months due to my preoccupation with meetings, applying for jobs, preperation for the interviews etc.

I wish all the shorlisted applicants for ISB R-2 interviews a very best and I hope their dreams come true.

Good bye for now.

Delhi Interview Experience - 3

This is the interview experience of an R-2 applicant on 09-01-2006 at Dlhi.

His profile :-

GMAT:660
Work ex.: 3.5+ years in corporate finance/treasury
Acads: B.E.(Mumbai University), MBA(IIT Kanpur)

Here it goes.........

"The interview started at 09:00 AM. Prior to that I was given an essay to write with the topic being 'Terrorism'. By the way, they did look at it.

There were 2 people, Mr. Venkat who is the deputy head of admissions and a middle aged lady. I do not know her name since she did not introduce herself. They had thoroughly researched my application. I already hold an MBA degree and they asked me as to why
I thought I needed another one, and that too from ISB.
To this I told them about what I thought ISB's strengths were and why I thought it was a right fit to me.

They followed up with questions about my work experience, what was the rationale when I changed jobs. Since I have a finance/treasury background, they asked me as to why I did not want to work in banks where I could be close to financial markets. To this replied that since my experience transcended different areas of corporate finance, a bank job in a
specific domain would see me spend the rest of my life in the same profile.

I was asked about what would distinguish me from other applicants since I wanted a consulting/investment banking job to which I replied that my corporate experience across Treasury would itself serve as a differentiator since I had a first hand experience of
Corporate environments.

Mr. Venkat then asked me whether I had any questions. I asked them about the Leadership Development programme that they had and how they actually implemented it. I also asked about the bidding system that they have for electives. This concluded my interview at 9:30

Hope my narration helps others for their interview."

CII's Conference on Telecom & Broadband - Technical Session - I

On behalf of the Income Tax Department, Andhra Pradesh, myself and one more Officer have attended the Conference on Telecom & Broadband conducted by Confederation of Indian Industry (CII), Andhra Pradesh on 10th January 2007 at CII Sohrabji Green Business Centre, Madhapur. This conference is to understand the new tends in telecom & broadband technology, the challenges and opportunities that it provides. The conference also deliberated on how to manage expectations of various stake holders, strartegies pertaining to aligning IT & business, business continuity and telecom outsourcing beside others.

BACKGROUND:-

The telecom services have been recognized the world-over as an important tool for socio-economic development for a nation. Telecommunication is one of the prime support services needed for rapid growth and modernization of various sectors of economy. It has become especially important in recent years because of enormous growth of information technology and its significant potential for the impact it has on the rest of the economy.

Telecommunication networks of India and China are among the largest in the world. India’s position as a global capital of outsourcing industry has been a major trigger for spurring broadband demand in the country. India operates one of the largest telecom networks in Asia and fifth place after China, US, Japan and Russia, with 183.46 million telephones as on November 30, 2006, as against 125.79 million as on December 31, 2005, a 50 percent growth rate.

The mobile phone made a debut in the country in 1995 and struggled for the first three years to touch 1 million mark in 1998. Thanks to the new telecom policy operated on revenue sharing mechanism for mobile operators, and southward movement of handset prices, the number of mobile subscribers touched 100 million in June, 2006. The mobile market is expanding at an awesome rate of around 5 miilion new subscribers added every month.

Four of the top ten broadband economies of the world are in Asia. South Korea, Hong Kong, Taiwan and Singapore have the distinction of achieving highest broadband household digital connectivity index of 60% to 80%. Broadband services were launched in India in 2005 and presently cover about 300 Indian cities with a combined 2 million connections. Although the Indian broadband sector is in its nascent stage, it offers huge potential provided proper policy initiatives of the government are combined with technological innovations so as to provide these services to customers at reasonable and affordable prices combined with satisfactory service.

The Conference was inaugurated by Mr. K. Rosaiah, Hon’ble Minister for Finance, Government of Andhra Pradesh. In his inaugural address, he congratulated CII, who with the help of state government organized this conference. He stressed the importance of information technology revolution helping the governments in initiatives like tele-education, tele-medicine, and e-governance. Accelerated growth in the penetration of PCS and convergence of video, audio and communication are paving the way for this revolution, he said. The domestic consumer mass for IT, telecom and consumer electronics is also contributing to the fast pace of telecom and broadband growth in the country. As per him, the main constraints are infrastructure, government policies and high interest rates. He said “the need of the hour is globally competitive”

In the theme address, Mr. Shakti Sagar, MD of ADP Pvt. Ltd., a fully owned subsidiary of Automatic Data Processing Inc., USA, said “today’s broadband is tomorrow’s traffic jam”. According to him, the main challenges in broad band sector are
- Cost, quality and content
- Broadband equipment
- Return on investment
- Affordable and high speed broadband

Presently, Korea is ahead in broadband services with a penetration rate of 80% : out of 15 million houses in Korea, Braodband is available in 12 million houses.

In his special address, Mr. Andrew Dinsley, First Scretary (Trade & Investment), UK Trade & Investment, given the UK’s perspective on broadband. He said that Singapore has free internet facility at its airports. In UK, the broadband subscribers are increasing at rate of 1 lakh per week. In fact, the number of mobile phones in UK standing at 67 million is more than its population at 60 million. In UK, the broadband services are provided free of cost. With the emerging technologies, there are enormous investment opportunities for Indian companies in UK and vice versa. Hyderabad based North Gate Technologies, a VoIP service provider, invested in UK. Vodafone, Orange and T-mobile are investing huge amounts in R&D leading to innovation in broadband technology. If the pace continues, India will knock out Japan for the second position in terms of investments made in UK.

In his keynote address, Mr. B V R Mohan Reddy, Chairman & Managing Director, Infotech Enterprises Ltd., has said that 21st century belongs to knowledge economy, which will create wealth all around the world. Research & Development (R&D) will become a key driver in innovation. The Indian telecom sector is growing at such an unprecedented rate that Vodafone is ready to buy stake in Hutchisson Essar at a cost of around $1100 per subscriber where as the international average is only $700 per subscriber. Demand form business will drive the growth of broadband in India. With the help of broadband, business processes will be improved achieving efficiency and increasing productivity. The sectors like supply chain management, movis, music, games, local information, e-education, life sciences, health care sector, e-governance and agriculture sectors are benefited by improved and faster broadband connectivity. More and more growth is expected from Tier-II and Tier-III cities like Vijayawada, Visakapatnam, Rajahmundry, Guntur and Kakinada in Andhra Pradesh.

In the world, the total broadband connections were 17 million in 2001, which was increased to 70 millions presently. South Korea tops the list with a penetration rate of 57 per 1000 households whereas in India the rate is 2 connections per 1000 households. Presently there are 60 million television viewers and 7 million internet users under dial-up connections. These are the potential customers for barodband connections.

Technical Session I : Broadband : The Wi-Fi world. What next?

Under the Technical Session-I, Mr. K. Balachandran, MD, ADC Krone, has addressed the conference under the theme “New Networks – New Ways”. Presently, service sector contributes around 56% to our Gross Domestic Product (GDP). Indian cities like Chennai and Banglore are absorbing office space equivalent to that of any other global known cities like Tokyo and New York. According to him, bundled services will drive the growth of broadband. The service provider will have to put together his video, audio and voice services. For example, in US, the revenues of those companies which have provided bundled services have grown faster than that of companies providing single service like ISP, Video Streaming etc. The evolution and advancement of broadband technology over copper, fiber and wireless will pave the way for seamless services integrating all of our gadgets including telephone, television, mobile, and computer.

The theme of tomorrow’s world is “Any content, Any where, Any time”. In recent years, mobile operators are passively sharing the mobile towers among different service providers so as to reduce the fixed costs. Gradually, they may be service convergence and network convergence on an active sharing basis wherein broadcasting capacity may be shared among the service providers. IEEE 802.16e deals with the broadband spectrum. In India, the 3G spectrum which may be auctioned by the Indian government may be 2.3 GHz, 2.5GHz, 3.3Ghz or 3.5 GHz. The main problem in the 3G spectrum is related to uniformity of the spectrum throughout the world as different countries are using different frequencies making the standardization of equipment difficult and in effect, rising the initial cost of infrastructure for broadband services. Many of us felt the failure of network coverage in big buildings, malls, hotels, underground parking spaces. Some of the industrial areas like underground mining areas are still to be covered by the network coverage. 60 to 70% of all calls are originated from the buildings. Hence, in-building systems to enhance the coverage is one of the area are required to make the broadband available to us while on the move. Mobility, affordability and speed are the three crux areas for successful penetration of broadband services.

Gradually third party infrastructure companies are coming into picture. These companies are only for establishing the telecom and broadband equipment and facilities. For example, American Towers, a owner, operator and developer of wireless communications towers with more than 14000 sites in the United States, Mexico and Canada, is in negotiations with Tata Teleservices, Hutchison-Essar, and Bharti for outsourcing and management of towers. The move is expected to help Indian telecom companies to reduce their requirement for fresh capital, reduce costs and unlock value of shareholders. Reliance Communications has decided to hive off its mobile phone towers into a subsidiary and offload a significant stake to American Tower.

Mr. T Hanuman Chowdary, Director, Centre for Telecommunications Management and Studies, a pioneer in the development of Indian Telecom Policy, spoke on the theme “Broadband Development – R&D for Technology & Applications: A National Mission”. As per the figures given by him, Average Revenue Per User (ARPU) was 1.6 times the Per Capita Income in 1994. With the drastic reduction of tariff in recent years and with the rising personal incomes of our populace, the ARPU has come down to 0.16 of per capita income at present. There is enough back-bone bandwidth for domestic and international traffic, he said. BSNL, Rail Communications, GAIL, PGCL & numerous P-Telcos have sufficient bandwidth, provided we use them efficiently. BSNl/MTNL is also planning for another Undersea Cable. VSNL acquired Canada’s national carrier – tele Globe which has connectivity to 240 countries and ownership in 100 subsea and terrestrial cable systems. He expressed concern over minimal allocation of budget for R&D in the telecom filed. For example, ITI has spent an amount of Rs. 38.73 crores on R&D in 2006, which is a paltry 2.21% of sales. Like pharma companies, Indian telecom companies have to spend at least 20-30% of their sales on R&D. In US, IT companies spend 15% to 30% of their sales on R&D. He lauded the government for its internet policy wherein there is no entrance fee, no license fee, no revenue sharing and no territorial restriction / obligation. Induce multi-story buildings, new townships / residential complexes to install Wi Max base stations and connect them to the back-bone.

Lt. Col. Narendra Kumar Yadav, genral Manager – Projects, ICOMM Tele Limited, addressed the conference on the latest alternative technology available for broadband services. It is called High Altitude Platforms (HAPS) wherein high altitude positioning of balloons fitted with broadband equipment caters to wider area wireless connectivity. The frequency spectrum is 28Ghz or 48 Ghz. In stratosphere, 17-22 kms above the ground, the air velocity is almost zero. In this layer, airships will be placed. One such airship can cover the land area of 75km radius, beneath it. It can have multiple antennas which can cater up to an area of 600 km diameter on earth. In fact, Japan has already proved this technology. But, we have to wait 3 to 5 years for this technology to arrive in India. Vehicle users in India may have to wait for at least 7 more years for this technology startup.


Mr. Kusumba S, Treasurer, ISP Association of India (ISPAI), spoke about the dangers involved in the wireless communications and pitfalls in the government’s broadband policy. While using your mobile phones, deactivate your Bluetooth or wi-fi, otherwise the man next door or in the vicinity may hack your mobile, steal your address book or message. He has introduced the terminology like WarWalking, WarTalking and WarFlying – these terms refer to the methods adopted by hackers to look for open wireless networks to login. In fact, there is WarChalking in which the the persons finding an open wireless network marks it on the traffic post or wall post with IP address and speed of the network so that other people can can come down to that place for entering into the network and use the internet services freely.

National Telecom Policy, 2005 enunciated the broadband targets at 3 million and 9 million by 2005 and 2007 respectively. However, we could achieve only 2 million broadband subscribers by the end of 2006. In fact, this is mainly due to the lopsided policies of the Government, he says. For example, BSNL’s 7 million copper conductor pairs covering 35 to 40 million premises can be used for providing broadband services. However, only 4% of the above network is used for these services as the present policy does not allow ISPs to access this copper network. He said that it is not the technology; it is the policy which is inhibiting the growth of the broadband sector in India.

M. T. Arvind, CEO, Amplebit Technologies, has thrown light on soft modem for broadband connections. In the initial stages of internet days, we had bulky external dial-up modems. Gradually, they have been replaced with the internal modems. Nowadays, the vendors are selling computers with modem inbuilt. Even in the case of broadband connections, we are presently spending around Rs. 1200-1500 on the broadband modem, installation charges of around Rs. 250 and recurring monthly charges of Rs. 250 – 500 depending on the usage plans offered by the service providers like HathWay or Dishnet. With the introduction of soft modem, a modem in software, the initial coast of broadband connection will reduce to the level of dial-up connections making it viable for rural and semi-urban expansion. He says “ affordable bundling of broadband modem with PC will accelerate the penetration of broadband services”


Relevant Reports :-

Global Corporate Services – Outsourcing and the rise of India by CB Richard Ellis, one of the world's leading commercial real estate services firm

Relevant Articles :-

Capital Gravitating to Hot Spots

Relevant Books

Impact of globalization on cities and city-related policies in India - Abstract

Management Consulting

One beautiful article was posted in the Yahoo Groups. I am reproducing the same for your benefit.
Disclaimer :- These are the views of the author and not mine.
"Management Consulting is a broad term. For the folks looking to make a switch into management consulting, it's extremely important, I believe, to understand the consulting industry and then try and find the best fit or "practice". Below is an insight into the industry. Hope it will help people to get some clarification. Current ISB students/alumni please feel free to add or correct.
Types of consulting firms:
1: The Big 5:
Accenture (formerly Andersen Consulting)
BearingPoint (formerly KPMG Consulting)
Deloitte, and
2: Small Firms:
Small firms or boutiques often provide specialized services or offer expertise that focuses on one industry or a single business practice area. These firms tend to be small, lesser-known niche players that do not regularly compete directly with the larger consulting organizations. Many of these firms operate in a single, geographic region. Some small or boutique firms service only one client.
3: Sole Practitioners.
Perhaps the most difficult segment to define in the management consulting industry is that of the sole practitioner. This group encompasses many outplaced or retired executives and part-time consultants who offer expertise in areas where they have a great deal of experience. Sole practitioners are often engaged by smaller firms and even their previous employers.
4: Internal Consulting Organizations.
Large corporations may have recurring project work for which the expertise of external management consultants would be required on an ongoing basis. Many such firms have developed internal consulting staffs in order to deal with this demand in a more cost-effective manner. Such internal organizations may be generalists or may specialize in corporate strategy, human resources issues, information technology, or other areas that are critical to the company's operation.
Different practice areas or segments (for the lack of a better term) in Management Consulting: This is where we all need to identify our niche and are of interest and then work towards it.
1: IT/MIS. The information technology segment is the largest segment of the consulting industry
2: Compensation/Benefits Consulting. Compensation/benefits consulting firms represent the second largest independent segment of the industry in the US. Firms that specialize in compensation/benefits consulting offer services related to human resource management with specific expertise in practices such as developing corporate grading and compensation schemes, titling plans, and benefits packages.
3: Generalist Consulting. Generalist management consulting firms typically provide advice on strategy to their clients but may also have internal expertise in specific industries, such as banking or health care, or in particular practice areas, such as new product development or operations. Examples include McKinsey & Company, Inc.; Booz, Allen & Hamilton, Inc.
4: Strategy Consulting. Strategy consulting firms specialize in providing advice on corporate strategy to senior executives—answering such questions as, "How can our firm improve profitability?" Examples include the Boston Consulting Group and Bain & Company.
5: Marketing Consulting Firms. These firms provide marketing research, product test markets, target market selection, and other services directly related to the marketing of client products or services.
6: Business Re-engineering/Organizational Effectiveness. This specialty in management consulting refers to the radical redesigning and rebuilding of the processes and functions of a business to recreate the company as a highly effective, cohesive whole that performs optimally.
7:Environmental Consulting
8 Health Care Consulting. There are two primary specialties that fall under the heading of health care consulting. The first practice area is providing general advisory services such as strategy consultation or cost-containment studies for health service agencies (e.g., Health Maintenance Organizations) and hospitals. The second practice area is in helping corporations to select employee health benefit plans that minimize costs and provide the best health care coverage for the organization.
So basically, if you feel this world needs one more segment area in consulting, by all means establish it."

Financial Management

I have started a new series for describing courses in MBA either at ISB or at other business schools. I mainly include free online resources for the benefit of the viewers. Today, I start with Financial Management.

Objective

To understand the role of Finance in a corporation, with emphasis on the theory and tools that are used to help company leaders make sound financial decisions. Students who successfully complete this course will have an understanding of analytical tools that can help their future (orcurrent) companies make sound financial decisions, ensure they have sufficient capital for operations and growth, and maximize shareholder wealth. They will also understand the time value of money and how its application can contribute not only to good decision-making in business, but also to their own accumulation of wealth (as a financial security).

Topics

. Overview of Financial Management
. Time Value of Money
. Financial Statements, Cash Flow & Taxes
. Analysis of Financial Statements
. The Financial Environment
. Risk and Rates of Return
. Bonds and Their Valuation
. Stocks and Their Valuation
. The Cost of Capital
. The Basics of Capital Budgeting
. Capital Structure
. Working Capital Management
. Short-term Financing
. Financial Planning and Forecasting

TEXTBOOKS AND OTHER MATERIALS

Required:
Recommended:

Other related articles

Viewing some of the above articles in PDF format requires Adobe Acrobat Reader. The same may be downloaded from Adobe Web site.

Banglore Interview Experience - 4

This is the ISB interview experience of an R-2 applicant on 09-01-2006 at Banglore.

His Profile:
Job profile - software engineer
GMAT-710 ; AWA-4.0
Exp - 6.5 years

"My interview was scheduled at 9.00. I reached well in advance. I was given the topic "Marketing" for short essay.

During the interview they asked me about my strengths and examples where I displayed my strenghts. Then they ask me to estimate market size for a 'virtual reality cricket game'.
I was also asked about my passions and few follow-on questions.

Overall it went for half an hour.
I made a blunder during the market size estimation question. I lost the focus in between and the interviewer had to repeat the part of the question. I felt very bad about that. I think that could be my undoing.

So overall after coming out I felt I did not do well."

Banglore Interview Experience - 3

This is the interview experience of an R-2 applicant at Banglore on 06-01-2006.

His Prile:-

IT Experince - 2.5 years
International Work experience - 6 months ( as a onsite coordinator and team lead )
Acads - Excellent
Extra Curricular - Decent
GMAT Score - 680 / 5.0

"One gentleman from panel came to the cafeteria to greet me inside the room, where another lady from adcom was sitting. There were just two of them and majority questions were asked by the gentleman as the lady was busy observing my each and every moment and words...

My interview started with a question from my cover letter ...

Since i want to shift into HR Role, i was questioned on that ...

I explained that i want take things in a step by step way and first want to join as a project manager only ( as even he is a people manager in a way and playing in some manner an HR role ) and my long term goal is to move into organisational level HR policy making at corporate level ...

then i was asked on two HR Policies i would change if i become HR Head in Infosys, which i answered quite well and explained the reasons along...

next few questions followed on my work experience and what different i will be from other managers if i become one ...basically just a question to tell my strengths ...

and this was followed on my experince in working in 5 teams so far and a situation or project which i thought could have been better and in what ways ... ( i had worked or slogged in a project which was not well planned in terms of skill set and manpower and gave that example and explained what diff cud i hv made if i had planned it ...

then i was asked what if i dont get into ISB, i said i have my job which holds good opportunities as i have UK and US visa ...

Then i was asked what advantage you have if you join after 2 years - i explained obviously i will have more experience to count on, but i feel now is the best time to apply as i have plans of settling down in life in 2 years from now and then i wont be able to give justice to my education even if i join as my interest and focus will be
diverted towards my family ...Also i explained though i dont hv a quantity work experience but i have good quality work experience ( my onsite as i played the role of team lead there with just 1 year of job experience and did it quite well and in our team we had ppl from diff nationalities - swiss, german, american, irish etc)

On this note my interview ended as i had no questions to ask them ..."

Emerging Sectors in Ad spending

The year 2006 would not only be remembered for sky-rocketing property prices but also for the big ad moolah that was shelled out by realtors, making them the biggest advertisers on television and on print. Realtors edged out automobile brands and educational institutions in the race to emerge as the largest advertiser of 2006 with spends of around Rs 510 crore between January and November, a 60% growth over 2005.
Another emerging category, travel and tourism, registered the highest growth of 70%, a feat that propelled it into the top 10 league, according to media agency Mindshare Insight’s estimates. Cars and Jeeps vroomed with a 16% rise and occupied the number two slot. Educational institutions and two-wheelers were the third and fourth-largest advertisers respectively during the period, while independent retailers stood fifth in the pecking order with a 41% increase in ad bucks compared to 2005.
Real estate analysts attribute this surge in ad spends to IPO build-up of various companies. “With 350 malls coming up in the next two years, the retailers will have a choice of malls to locate themselves. So one will see a spate of ad campaigns by mall developers. Moreover, as real estate is emerging as a preferred asset class, developers are keen to enhance visibility to attract investors,” Knight Frank India chairman Pranay Vakil said.
Surprisingly, the FMCG sector, which used to take up a lion’s share of the ad spends, has only one entry in the top ten (toilet soaps), as shampoos and other categories saw sluggish spends. “Although, the FMCG sector recorded a positive growth last year, it was not able to match up with the growth in other buoyant sectors such as real estate, retail and telecom,” said Mindshare Insight national director Sanchayeeta Bhattacharya. Another trend that emerged in 2006 was the entry of branded jewellery segment in the top 20 rankings with a 40% increase in ad spends. Interestingly, despite the growth in travel and tourism, airlines have dropped out of the top 20 list. “Last year there were a larger number of airline IPOs. Also, as losses increased in the airline industry, ad spends got adversely impacted,” Bhattarcharya added.
Media planners say that as the Indian economy, increasingly, takes global cues, where retail and automobile sectors occupy the top most slots as the biggest ad spenders, India, too, is showing similar signs in the ad space as auto and retail gears up with more ad budgets. “Some categories which are obvious misses include financial advertising, which should have fared better considering the boom in the capital markets and an overall heathy economy,” said Lodestar Universal CEO Shashi Sinha.
Source : The Economic Times

Banglore Interview Experience - 2

This is the ISB interview experience of R-2 applicant on 06-01-2006 at Banglore

His profile :

GMAT: 770
3.5 years in IT (no international ex)
Acads: Average


Ms. Hema, Mr. Ranga Rao and another gentleman comprised of the interview panel.
The questions were
"1) Just almost as I sat, they wanted me to give a description of my what I've done so far in my career and how my application this year is different from the previous year's (I am a reapplicant - had applied through GRE last year.)
2) A follow up question on my experience at work. Additionally, I had learnt German, so a couple of questions in German.
3) You have written that your grandfather has a business. What business?
4) So what differences do you see in the urban and rural consumer?
5) If you were to open a soap manufacturing unit, what factors would you consider, and how many soaps will you be able to sell?
6) Anything you want to ask?
That was pretty much it. It was a short and sweet interview."
All the best for all the shortlisted R-2 applicants for ISB.

Third meeting at Barista Coffee House

It's again. Our Core Group has met with R-2 applicants at Barista Coffe House, Jubilee Hills. I also attended this meeting with other Core Group members, Rajeev Bharadwaj (Class of 2008 - Queens, Canada), Aalla Kiran Kumar (Class of 2008-ISB), Sravanthi (Class of 2008-ISB), P Arun Kumar (Class of 2008-ISB), Lakshmikanth (Class of 2008-ISB) and Gajanan Pujari (Class of 2008-ISB) and three R-2 applicants from Hyderabad, Avinash (Avi), Avinash and Soujanya.

I congratulated all the members of the Core Group who have become ISB's Class of 2008 and Rajeev for becoming member of Class of 2008 in Queen's School of Business, Canada. Then, we discussed each of our plans for next ten years (Where we would like to be after 10 years hence now?). We clarified some of the doubts raised by R-2 applicants. We suggested to have one more meeting after the calls for Hyderabad applicants come through. I must thank Avinash to invite me personally to the meeting, though I did not get through ISB's admission process.

Banglore Interview Experience

This is the interview experience of an R-2 applicant on 06-01-2006 at Bangalore:

He was a given an essay to write on "Animal Rights" and was called in in at the exact time.

Two panelists- a Lady (P1) and a Prof (P2)

"P1: So Abhishek, from IIT u joined company X and then moved on to Company Y.
Talk us thru this and why did u change jobs
Answered with my reasons.
P2: So why do u want to get into consulting now. Especially after u say that u enjoy ur work in company Y
Gave some reasons. Not very convincing i thought.
P1:Do u know aht kind of jobs consultants do?
Anwered yes, and elaborated on it.
P2:So u want to be a consultant and come up with solutions for comapnies that will never work? (smiles)
I said that failure rates are high in consulting but still the ideas are well braistormed upon and are the best options given the constraints.Gavehim an example of iridium which was a breakthrough project but was a major disaster.
P3:Ok, I have a mint that i am manufacturing that tastes like an ordinary mint but enables u to see in the dark for 8 hours. There are no side effects. How many ppl will but the mint in an year
I asked the cost of the mint and he gives me a figure. Then i tried to analyse what kinda ppl might need it and come up with a number.
P2:I would be happy if i able to sell that many in a year
Some more discussions on the theory i presented. I dont think i was too precise in my approach
P1:So what if u dont get a consulting job?
gave some crap
P1:what if u dont get into ISB?
more crap
P1:So u are a tennis enthusiast.Who is the number one player today?
Told
P1:What do u thinkof the rift between the Paes and bhupathi
Gave my views
P2:Who's style do u like more b/w paes and bhupathi ?
Sais Leander
P1:U said u want to write. What do u want to write about
Told my interests
P1:U have any questions for us?
Said NO
Thanked and left
Whole experience lasted for 17 minutes approx"

I request all the R-2 applicants who are yet to attend the ISB interview that please use the last session, wherein the adcom asks you for some questions, for your advantage. This is to know how serious you are about doing an MBA in ISB, how much do you know about the course, how much do you know about the academic currciculum and life at ISB and how these facilities will enable you to achieve your goals. Please do read the site of ISB, especially the clubs, their activities etc. Previous posts of this blog also may be helpful in preparing questions for the interview panel.

Government is liberalising SLR mechanism

An ordinance is on the cards to reduce Statutory Liquidity Ratio (SLR) ceiling limits so as to free up more funds for the industry. The ordinance would amend the Banking Regulation Act, 1949 to give RBI freedom in fixing the floor and ceiling levels of the SLR – now the floor and ceiling are stipulated in the Act itself. Presently, the Act stipulates 25% floor and 40% ceiling rates for SLR. According to these statutory SLR requirements, banks must keep a stipulated proportion of their total demand and time liabilities, in the form of liquid assets, namely cash, gold and approved securities. Investment in these securities amounts to mandated lending to the government, leaving that much less to the banks for advancing loans.

Present growth in off-take of loans at 25% is still running ahead of the 20% projected by the central bank earlier this fiscal. But, the growth in deposits is not commensurate with the scorching pace of loan growth. Over the last year or so, the high credit growth was financed by banks partly by offloading part of their investments in government securities in excess of SLR norms. During the current fiscal also the banks are following same procedure but are now close to the minimum statutory requirements. This implies that the banks can lend more in future provided accretion to their deposits is substantial. With banks finding it difficult to mobilize deposits in short term, relaxing the regulatory norms for reserves seems to be the only option left for the government. Paring the SLR would fit in with the planned liberalization of financial sector. However, with a reduction in SLR, the cost of borrowing may go up as the government will have to borrow from the market at higher rates, which will have a impact on the fiscal discipline of the government. Hence, such a reduction in SLR holdings would have to be consistent with a lower fiscal deficit.

In the mean time, Government wants to introduce fiscal incentives so to make bank deposits attractive for middle class, who are increasingly diverting their funds from traditional investments to other green pastures like real estate, stocks and mutual funds. Recently, government has allowed income tax deduction for the interest earned on fixed deposits with maturity period of five years or more, subject to the total ceiling of Rs. 1.50 lakhs for all eligible investments. The government is also thinking to exempt the interest income on deposits to the extent of Rs. 15,000 per annum per person. This proposal may come through in our next budget to be presented in the Parliament on February 28,2007.

Glossary :-

Demand Liabilities

'Demand Liabilities' include all liabilities which are payable on demand and they include current deposits, demand liabilities portion of savings bank deposits, margins held against letters of credit/guarantees, balances in overdue fixed deposits, cash certificates and cumulative/recurring deposits, outstanding Telegraphic Transfers (TTs), Mail Transfer (MTs), Demand Drafts (DDs), unclaimed deposits, credit balances in the Cash Credit account and deposits held as security for advances which are payable on demand. Money at Call and Short Notice from outside the Banking System should be shown against liability to others.

Time Liabilities

Time Liabilities are those which are payable otherwise than on demand and they include fixed deposits, cash certificates, cumulative and recurring deposits, time liabilities portion of savings bank deposits, staff security deposits, margin held against letters of credit if not payable on demand, deposits held as securities for advances which are not payable on demand, India Millennium Deposits and Gold Deposits.

Statutory Liquidity Ratio (SLR)


In terms of Section 24 (2-A) of the B.R. Act, 1949 all Scheduled Commercial Banks, in addition to the average daily balance which they are required to maintain under Section 42 of the RBI Act, 1934, are required to maintain in India,

a) in cash, or b) in gold valued at a price not exceeding the current market price, or c) in unencumbered approved securities valued at a price as specified by the RBI from time to time.

an amount which shall not, at the close of the business on any day, be less than 25 per cent or such other percentage not exceeding 40 per cent as the RBI may from time to time, by notification in gazette of India, specify, of the total of its demand and time liabilities in India as on the last Friday of the second preceding fortnight,

At present, all Scheduled Commercial Banks are required to maintain a uniform SLR of 25 per cent of the total of their demand and time liabilities in India as on the last Friday of the second preceding fortnight which is stipulated under section 24 of the B.R. Act, 1949.

Taxmen Vs. Tollywood Cricket Match

Yesterday we had a cricket match between Tollywood and IRS officers in Lalbahadur Stadium, Hyderabad. The trophy is named as Taxmen Tollywood Trophy. From tollywood side, Mr. Srikanth, Mr. Tarun, Mr. Prabhu (Raviteja's Brother), Mr. Taraka Ratna and other upcoming actors participated. I could not participate due to lack of practice.

Taxmen won the toss and decided to bat. We could achieve a score of 168/5 in 25 overs with Mr. Maruti and Mr. Laxman crossing half-a-century each. However, tollywood did play well and we lost to them. In fact, Prabhu has crossed 50 in less than 30 balls. They scored the target within 17 overs by losing two wickets. Our poor performance in bowling resulted in our loss.

Global outlook for the Steel industry in 2007 & beyond

The global steel market is enjoying its fifth consecutive year of strong output and demand growth. The outlook for 2007 is expected to remain relatively bright, but a less vibrant world economy should slow demand and production growth, according to industry and government officials at the OECD's Steel Committee meeting in Paris on 7-8 November 2006. The situation in world steel markets remains strong. Continued capacity expansions observed in various parts of the world could, however, endanger positive market developments.

World steel production

Crude steel production is on track to grow by around 90 million tonnes in 2006, i.e. by 8%, to reach 1.22 billion tonnes as a result of synchronized production growth in most regions of the world.

1. China continues to drive world production developments. In the first nine months of 2006, Chinese steel production reached 339 million tonnes, up 23% from one year earlier. Elsewhere in Asia, Japan and South Korea continued to register only modest growth. Steel deliveries in Japan are nevertheless expected to rise by 1.9% to 100.6 million tonnes thanks to brisk demand from the manufacturing sector.
2.The European Union is seeing steel production rebound strongly, reflecting improvements in the economic situation and steel demand. Steel output is expected to rise by 9 million tonnes to 197 million tonnes in 2006.
3.In the CIS countries, steelmaking activity has re-accelerated, led by Russia, where crude steel production is expected to increase by 4 million tonnes this year to reach 70.2 million tonnes supported by capacity expansions in electric-arc furnace steelmaking.
4.In North America, steel production in the U.S. and Canada is rebounding following last year’s steep declines. Reflecting strong demand, steel production in the United States should increase by around 9% to 102 million tonnes in 2006.
5. South American steel output continued to slump in the first half of 2006. Production in Brazil, the largest producer in the region, fell by 1.4 million tonnes, or 9.1%, partly due to a five-month blast furnace outage, but for the year as a whole should reach the same level recorded in 2005.
In fact, the total steel demand is expected to rise by 60 million tonne in 2007, with the European, Indian and Asian steel markets registering a 10% growth in demand. Regional and country differences in consumption growth will come into play, with rates in Asia, North America and the European Union generally expected to slow while steel demand in India, Latin America, Africa and the Middle East will grow more quickly, Ian Christmas, secretary-general of the International Iron and Steel Institute (IISI), said at the group's annual conference in Buenos Aires, Argentina.

World demand for steel
Global demand growth has accelerated in 2006, in line with the strengthening pace of world economic activity and buoyant infrastructure and other investment in rapidly growing developing economies.
Chinese steel consumption reached 287 million tonnes in the first nine months of the year, up 28.75 million tonnes or 10% from a year earlier. Indian consumption is also increasing swiftly, though from a much lower level of 38 million tonnes. The shipbuilding, auto, and industrial machinery industries are boosting steel use in Japan and South Korea.
In the European Union, robust export demand and recovering domestic demand for goods manufactured in key steel-using industries will raise apparent steel consumption by 9.3% to 198.5 million tonnes. Within the CIS, Russian consumption is being bolstered by strong growth in mechanical engineering, construction, and railroad transport.
In North America, apparent consumption in the United States should reach 121 million tonnes, up 10% from 2005. In Canada and Mexico consumption is also expected to rise strongly. The overall 9-percent increase this year should lift apparent steel use to 1.12 billion tonnes from 1.03 billion tonnes in 2005. The more moderate 5.2-percent growth foreseen next year should push usage to 1.18 billion tonnes, according to IISI predictions, which embrace both real and apparent use.

Steel prices
After declining through much of 2005, steel prices recovered during the first half of this year. In some markets such as China, however, prices have remained soft this year reflecting local oversupply of steel. More recently, prices have started to recede in some markets in response to high inventory levels. As per Madhukar Sheth, member of the Bombay Stock Exchange, with consolidation going on in the global industry, prices could remain stable at the $560 per tonne level. The steel industry mirrors the economy and with the auto and construction industries in China, India and other Asian countries growing at a healthy rate, demand for steel should maintain its present growth, industry analysts feel. This will come as good news to Corus, which through Tata Steel, has been looking to enter the Asian markets for its construction and auto grade products.
Long-term issues
Consolidation in the industry has accelerated, highlighted by the recent Arcelor/Mittal and envisaged Tata/Corus mergers. Arcelor-Mittal will account for around 10 per cent of world steel production. Though consolidation will strengthen steel companies’ influence in world markets, the industry remains very fragmented as compared to the concentrated iron ore industry for example. Concern was expressed that steel producers in various parts of the world have increased capacity significantly or intend to do so in the years to come by extending existing capacities and/or creating new capacities, whilst most forecasts for demand over the years to come suggest that worldwide steel capacities are largely sufficient to satisfy demand requirements in the future.
Forecast upto 2010
MEPS (International) Ltd has upgraded its previous forecast for global crude steel production in 2010. Finished steel consumption is expected to be well over 1 billion tonnes. The oxygen process is predicted to provide around 65 percent of all steel making in 2010 - more than double the amount from electric melting.
The desire for self sufficiency in steelmaking is driving producers in many parts of the world to invest in new plant and equipment. By 2010, MEPS estimates that China's total steel output will be significantly above 500 million tonnes. India & Russia will become an increasing force.
In 2007, a correction is forecast in the European Union and NAFTA countries. This will, almost certainly, result in a growth rate below the figures recorded in the previous two years. Moreover, the pace of steel demand growth in China appears to be stabilising at a level slightly below the percentages in the recent past. Furthermore, China will be a net exporting country in 2006. The high volumes of foreign sales will be curbed in 2007 by government actions. Output growth in China is likely to be held back.
As outlined in their previous report, a two speed steel industry is developing. Asian and Russian demand is racing ahead. At the same time, the industrialised nations are exhibiting more modest real growth conditions. New capacity is migrating towards steel demand. Furthermore, with high energy and steelmaking raw material costs, new capacity is often being scheduled for installation nearer to the location of the input materials.

The Global Social Venture Competition - An introduction

With this post, I complete my century in the arena of traget-ISB innings.
This post is about Global Social Venture Competition, which began in 1999 as a student-led initiative at the Haas School of Business in California, USA. In May 2001, Columbia Business School and The Goldman Sachs Foundation partnered with Haas to extend the reach of the competition and help grow a national platform for social ventures. In June 2003, the London Business School joined the competition partnership to extend the competition globally. In July 2005, the Indian School of Business was invited as an affiliate. In January 2006, the first Asia Semi-final round was held at the Indian School of Business.
This unprecedented partnership brings together the academic and financial worlds to support the creation of sustainable social ventures. The Global Social Venture Competition (GSVC) is seeking promising social entrepreneurs to enter its 2007 Competition. If you are an entrepreneur (or budding entrepreneur!) with a financially sustainable venture that addresses a social or environmental problem, it encourages you to apply. Winning plans in the past have ranged from global health to microfinance, from cleantech to education, from fair trade to community development, from business concepts to operating companies, and have included for-profit and non-profit models.
What is GSVC?

GSVC is the largest and oldest student-led business plan competition providing mentoring, exposure, and prizes for social ventures from around the world. GSVC's mission is to catalyze the creation of social ventures, educate future leaders, and build awareness for social enterprises. The competition supports the creation of real businesses that bring about positive social change.

GSVC is organized by the Haas School of Business at UC Berkeley in partnership with the Columbia Business School, London Business School, Indian School of Business, Yale School of Management, International University in Geneva, and a consortium of business schools in Korea. Every year, teams compete for more than $45,000 in cash and travel prizes, while gaining valuable feedback on their ventures.

What has GSVC achieved?
Since its inception in 1999, GSVC has awarded more than a quarter of a million dollars to emerging social ventures and has introduced early-stage social venture entrepreneurs to the investment community. Nearly 25% of past GSVC entrants are now operating companies.
How can I get involved?
1. Compete as an Entrant. If you have an idea for a social venture, or have an operating social venture, we encourage you to apply. Individuals or teams of any size from any country are eligible to compete in GSVC.

If you are looking to connect with a social venture or MBA student, visit the GSVC blog

Requirements: Every team must include at least one member who is a current student in ANY graduate business program or who has graduated from any graduate business program within the past 24 months. Operating companies are welcome to enter, though they must be less than 3 years old (as measured by first revenue or first patent issued). Plan can be for a for-profit or non-profit as long as either can be financially self-sustaining at scale.

o Every team must include at least one member who is a current student in ANY graduate business program or who has graduated from any graduate business program within the past 24 months.
o Operating companies are welcome to enter, though they must be less than 3 years old (as measured by first revenue or first patent issued).
o Plan can be for a for-profit or non-profit as long as either can be financially self-sustaining at scale.

2. Judge, Mentor, or Sponsor.
GSVC exposes entrepreneurs, investors, managers, and executives to the most promising new social ventures. Share your expertise by providing invaluable support as a volunteer mentor or judge. Sponsorships ensure that GSVC can continue to reward new ventures that integrate monetary and social benefit year after year.
For details on eligibility and how to get involved, visit GSVC

Key Dates for Indian / Asian Entries

November 15, 2006 Registration, Executive summaries due (to ISB)
January 12, 2007 Business Plans due (to ISB)
January 20, 2007 Initial Judging round at ISB
February 20, 2007 Short-listed teams submit revised plans (to ISB)
March 9-10, 2007 Asia Semi-final round at ISB
March 28, 2007 Finalists Business Plans due (to Haas)
April 12-14, 2007 Global Finals at Haas, Berkeley
April 14, 2007 GSVC Social Impact Symposium

Contact email: gsvc@haas.berkeley.edu
Useful Link: GSVC at ISB

Manpower Management, Real Estate and Supply Chain will be the key in Retail

A revolution is set to sweep across the country in the next three-to-five years in the retail sector, as traditional markets make way for departmental stores, hypermarkets and western-style malls. While penetration of organised retail in India remains slightly below 4%, domestic major retail players have announced aggressive expansion plans even as a plethora of new flashy malls are mushrooming in metros and second-rung cities. Three ‘big bang’ initiatives are shaking up the retail sector: Reliance Industries’ Rs 25,000-crore mega plan to create 100 million square feet of retail space and a sales target of Rs 100,000 crore by 2011, Aditya Birla Group’s Rs 15,000-crore retail foray and retail giant Wal-Mart’s entry via a joint venture with Bharti.
Even with net profit margins of only 4%, the return on investment is 16-18%. Besides, India’s vast middle class and its almost untapped retail industry are key attractions for global retail giants wanting to enter newer markets.
While there may be droves of young people applying for a spot behind the register, without any tradition of large retail stores in India, there is a paucity of experienced manpower available for mid-management positions. Meeting suitable manpower requirements and managing human resources in the future will become a challenge as competition hots up, experts feel. This is great opportunities for MBA students to look at this sector wherein you have also chance to prove your mettle and it is a emerging sector which may play for atleast next ten years. The other opportunities in these sectors include supply chain management and agricultural management. In fact, Reliance want to acquire 2000 acres of land in Karnataka in all District and Taluka headquarters for agriculture and it is also recruiting fresh agricultural graduates for a pay package of Rs. 3-3.50 Lakh per annum, till now an unkown figure in this sector.
Moreover, due to the increasing demand for manpower at the junior management level, number of schools and institutions have started offering retail specific syllabus. Retail management has come up as a seperate course in many B-schools. In fact, ISB has recently introduced an elective on retail management in its curriculum.
Presently, due to the dearth of experienced talent in this field, Reliance Retail is in the process of hiring around 100 senior expat managers, of which, 50-60 managers with 15-20 years of retail experience in global biggies like Wal-Mart, Best Buy, Tesco, ASDA and Kroger, have already joined the company. The AV Birla Group, which is readying itself for a retail venture, also intends to tap expats with overseas experience for its leadership team comprising 30-40 persons.
With some 350-odd mall expected to come up in the next three years, availability of reatil space is another major concern. Technopak Advisors pegs the gap between supply and demand of reatil space at a staggering 400 million square feet. Given the fact that large pockets of land are more easily available in smaller towns than in the metros, players such as Reliance have announced major retail forays in tier 2 towns. Tier 2 and 3 cities will be major growth drivers in future. So, if you are taking a management job in this sector, be ready to move to Tier 2 or 3 cities. However, while tier 2 cities represent an immense opportunity, infrastructure remains a major issue.
Another major issue is supply chain management. Significant invetsment in restructuring of the existing fragmented market in supply chain management is needed. According to a recent report by Enam Securities, cutting the number of intermediaries between the farmer and the reatiler could reduce costs by almost 7%. An estimated investment of Rs. 5000 crores will be needed to restructure the supply chain.
Detailed articles brought by ET Retail Survey
Opportunities in Retail:-

Vodafone's Mergers and Acquisitions Criteria

Today I read one interesting article in The Economic Times on Vodafone's MandA criteria. I am reproducing the same with slight changes for your benefit. This is a classic example of how strategic moves may some times prevail over the financial decisions.

Vodafone may be going all out to clear possible regulatory hurdles it faces in India, but the world’s largest cellular operator seems to be ignoring its own acquisition criteria, going by which Hutch Essar (HEL) is a questionable buy. Vodafone may be able to please regulatory authorities, but pleasing its own shareholders may turn out to be an uphill task for Vodafone, say analysts. In May, Vodafone envisaged a lower level of merger and acquisition activity in the future. Where value adding opportunities arise to acquire mobile assets, strict criteria will be applied. Firstly, targeted businesses should consolidate Vodafone's presence in a local or regional market. Second, a clear path to control will need to be identified. In addition, any acquisition must deliver an Investment Rate of Return exceeding the local, risk adjusted, cost of capital by at least 200 basis points and the return on invested capital should exceed the local, risk adjusted, cost of capital within 3 to 5 years.

If Vodafone goes ahead with buying HEL, it may not be able to meet these criteria. HEL has been valued at between $21 billion and $22 billion and Hutchison Telecommunications International (HTIL) itself is looking at valuations of above $14 billion for its 67% stake in HEL.

According to a JP Morgan note: “Vodafone may struggle. At $22.8 billion, we estimate that the RoIC would reach 7% in five years (appropriate weighted average cost of capital being 12%). Whilst our estimate excludes cost-reduction initiatives such as site sharing, investors might be uncomfortable if these need to be unduly substantial for MandA criteria to be upheld.”

Also, based on analyst expectations and assuming a $15-billion enterprise value, cash returns from HEL would be below 5% till 2010, compared with a cost of capital of at least 10%. The rate of return too is not likely to exceed the local risk-adjusted cost of capital by the required 2%.

Meanwhile, Goldman Sachs in a note said that Vodafone’s balance sheet would be stretched if it paid over $20 billion for a controlling stake in HEL, while adding that the company stood a better change “by aligning its interests with the Essar Group. It has also assigned an enterprise value of about $17 billion for HEL.

Besides, it has given two possible scenarios — if Vodafone were to buy HEL at $18 billion, then in the fifth year, the post-tax return on invested capital works out to 9.5%, but at $20 billion, it works out to 8.6%. In both cases, Vodafone will see earnings accretive only in the third year, Goldman Sachs said, while pointing out that “given the potential for bidding tension, the prospects of value accretion in the short-term look limited”.

Analysts also cautioned that parallels should not be drawn with Vodafone’s successful purchase of Turkish telco Telsim in May last year. Telsim, unlike HEL, was a case of turnaround, leaving enough room for improvement and growing margins.

However, in the case of HEL, EBITDA already stands at around 34%. This implies Vodafone will have to largely bank on increasing penetration to push up EBITDA margins. This won’t be an easy task as the Indian telecom sector is likely to see a slowdown in the future.

According to research firm Ernst and Young, urban tele-density is expected to reach close to 87% by the end of the decade and in rural areas, the cost of delivery is likely to be higher in view of the vast geographical spread and lower population density. This implies expanding margins will become tougher for telecom companies in the future, as a Europe-like saturation may set in.

Glossary:

Cost of capital
weighted average cost of capital (WACC)
Risk adjusted return on capital
Internal rate of return
Return on capital


Related Study :

Using the CAPM to estimate the Risk-Adjusted Cost of Capital

Estimating Cost of Capital Using Bottom-up Betas By Nancy L. Beneda, PhD, CPA, University of North Dakota

The modern MNC will aim to create the lowest risk adjusted cost of capital it can by blending that capital base from the world’s pools of capital

Textbooks free for developing countries

In an attempt to meet the needs of university students in developing countries, Richard Watson, director of the University of Georgia’s Center for Information Systems Leadership, has teamed up with leading professors to create a series of “$0” textbooks.

The goal is to create a free library of 1,000 electronic textbooks. A prototype is already complete, and the first official release will be this month (January). While the initial books will be business related, Prof Watson and the other Global Text professors are recruiting volunteers to write texts for the full range of university topics. The texts will be translated into Spanish, Arabic and Chinese with the assistance of faculty and students around the globe.

The Global Text Project uses a modified version of the Wiki software that powers the website Wikipedia. The project enables students to get free access to the Wiki-based textbooks, each of which will come in pdf and other formats so that it can be inexpensively printed for students without internet access. The Wiki software has also been modified so that only the book’s editors can accept readers’ changes.

The first GTP book will focus on Information Systems. Each book chapter has been assigned to a different academic which means that 17 professors from five different countries will be involved in the process.

Source Link : Textbooks free for developing countries - The Financial Times

ISB's road to rural areas and small towns

Here is a good news for applicants from rural areas and small towns who cannot afford their education in ISB. The often-termed `elite school of business' is planning to make its presence felt among the rural and small town populace. The effort will come from the alumni of the ISB, which is considering a scholarship targeting this sector.

Arjun Shankar, Chief Executive Officer, Ramky Global Solutions Private Limited and president of the alumni association, told The Hindu : "There is a lot of talent that needs to be tapped in rural areas. And this sector for some reasons is shying away from the ISB community."

The alumni seem to be conscious of the fact that students from the rural sector vie to get through other top-notch Indian institutes like IIT, but not ISB. There is a lack of awareness about the institute among the rural students and we need to bridge this gap. People from underprivileged backgrounds passing out from IIT do well in life. They can do the same here too and we need to create an environment where they can at least apply.


However, the alumni and the business school still needs to figure out the quantum of scholarship, identify the segment and performance parameters for all the proposals. The proposals will be subject to the school management's discretion.

Complete Article : ISB to make its presence felt among rural, small town populace - The Hindu

Poaching is the new game in retail sector

The Indian retail space has recently seen hectic action with Bharti’s Sunil Mittal joining hands with US-based world No 1 Wal-Mart. The $300-billion Indian retail sector is attracting foreign retail giants and local majors such as the Reliance group and the Tatas. With Wal-Mart coming to India with Bharatis as JV , Indian retail sector is hotting up with poaching exercise. As time and energy are involved in establishing new outlets, major players are looking for inorganic growth, by going out for acquisitions of companies with presence in multiple cities. These acquisitions will help these big players to come out with sufficent outlets before the Wal-Mart can make its presence felt in India.

1. Reliance Retail acquires Gujarat-based Adani Retail:-

In the first week of December, 2006, Reliance Retail started its first acquisition by buying out Gujarat-based Adani Retail lock, stock and barrel for Rs 100-110 crore. Sources confirming the news said the buy-out will give Reliance access to 54 retail locations (neighbourhood stores, supermarkets and hypermarkets) across nine cities in Gujarat in one shot, besides its infrastructure and sourcing facilities. As commercial real estate prices shoot up across India, the acquisition will help the company control costs substantially because 60% of Adani’s retail outlets are company-owned. The deal also works well for Adani as it will now focus on its core competencies like shipping and exports.
At present, Adani Retail operates a total of 54 supermarkets and hypermarkets and is likely to launch another outlet in Bharuch this week. The Rs 16,000-crore Adani group forayed into retail by acquiring a leading supermarket store V Ravjis in 2000. While in the first two years, the company did not expand into other cities, it moved faster in the last four years with presence in Ahmedabad, Vadodara, Jamnagar, Surat, Rajkot, Anand, Nadiad, Mundra, Gandhinagar and Navsari. Adani's neighbourhood stores are typically 1,500-3000 sq ft and sells food & grocery.
The supermarkets, around 3,500-4,000 sq ft each, sell plastic items, crockery, cosmetics, imported products and the hypermarkets, around 8,000-25,000 sq ft, have dedicated sections for grocery, fast food, fresh fruits and vegetables and apparel among others.
2. AV Birla Group acquires Hyderabad-based supermarket chain Trinethra Super retail.
In the new year, the AV Birla group has kicked off its retail plans by acquiring Hyderabad-based supermarket chain Trinethra Super Retail and its fast-growing online shopping outfit, Fabmall. Trinethra Super Retail was founded in 1986 and is southern India's fastest growing grocery retail chain. While the Trinethra brand is used in Tamil Nadu and Andhra Pradesh, in Kerala and Karnataka, it is known as Fabmall. Trinethra is scheduled to open stores in tier II cities such as Mysore, Coimbatore and Tirupur. The group also has warehouses in Hyderabad and in the states of Karnataka, Tamil Nadu and Kerala. Currently, the Trinethra supermarkets offer groceries, fresh fruits; vegetable and diary products; bakery, frozen foods and many have food counters / pharmacies attached to them.
Although the financial details of the Birlas’ retail business isn’t clear, it is said that the group would pump in Rs 5,000-Rs 6,000 crore at least in the initial phase, which could be subsequently ramped up once the business grows. Birla TMT Holdings, an unlisted company, is likely to part finance the investment, while some debt could also be raised. The Birla group, via Birla TMT, has raised close to $980 million through the sale of about 33% of its equity stake in telecom unit Idea Cellular, to about six private equity firms.
Relevant News :

ISB Radio Rolls

At 9.00 PM, 20 December, 2006, ISB Radio’s Beta launch rolled out its first broadcast. A full fledged student body and SFA (Spouses & Families Association) managed initiative, the ISB in-house radio was inaugurated on 3rd December, 2006, as a part of ISB Fifth Anniversary Celebrations. An online streaming radio, which can be accessed only within the ISB network through the intranet, got going with a one hour program, relayed twice, back to back between 9- 11PM. Student Sindhu Shanmugam, who conceptualized ISB Radio says, "This radio initiative will serve as a platform for the students, faculty and staff at the ISB, alums and the industry to connect with each other". RJs of the ‘MnM Show’, Students Sahil Mathur and Samir Mehta add, "We wanted the first few programmes to simply represent the youth factor at ISB- news, assorted gossip, fun, all rolled in”.

Speaking about the content , Sindhu informs that the programs broadly would relay campus news, chat shows with faculty( both on campus and visiting), alums and students, placement news, placement related preparation tips, events organized by different clubs at the ISB, views from and about the ISB. Adds Megh K, Student and Sound Engineer of ISB Radio, "We will also be highlighting the creative edge and the can-do passion, that brims in the campus. Dramas and plays, by the Drama Club at ISB, mimicry shows and jokes will be the other crowd pullers on our shows".

This is truly a ground breaking initiative, bringing together ideas and enthusiasm! Play on ISB Radio.

For complete details :- ISB Radio Rolls

iKshaa - Annual Event of Marketing Club at ISB

Dear ISB Aspirants,

The Marketing Club at ISB is pleased to introduce you to its annual event - iKshaa to be held on 5th of January, 2007. ikshaa in Hindi translates to 'looking ahead'. It is a conclave that brings together heavy weights from across the industries to share their
diverse opinions on globally relevant contemporary issues.

The theme for this year's event is "Think Global, Act Local". The event is structured in two phases. Multiple teams of ISB students (class of 2007) would work with brand managers from various industries to deliver presentations on allocated topics. The day will end with a panel discussion with senior marketing executives and closing remarks by Dean
Dipak Jain (Dean - Kellogg School of Management: Northwestern University)

The Marketing Club - Class of 2007 at ISB invites you to be part of ikshaa to experience the thrill of ISB campus life. All you need to do is to participate is to click on the link below to check the agenda and register for the event, which is free:

Register for iKshaa

The applicants whose interviews are scheduled after the above event may please attend so as to have some actual ISB experience.

Rural market will drive the consumer goods demand

With 62% of the Indian population living in rural areas, no marketing strategy can neglect this mass during the next decade. As per the research conducted by Assocham on the future of FMCG products in india, demand from rural and semi-urban centres will propel the growth of the consumer goods industry to touch a market size of over Rs. 1,00,000 Crore by 2012. Urban pockets, which have the biggets market size for all the FMCG products, would in the next 4-5 years switch over their consumption patterns for organic products, as per the report. Demand for FMCG products, including the replacement market, may stagnate by 2012 in urban pockets thus forcing the manufacturers to shift supplies to rural and semi-urban folks.
FMCG products like toothpaste, skin and hair wash, talcum, powder, branded atta, dish wash, instant cofee, ketchups, deoderants and jams, which have less than 30% penetration in rural and semi-urban areas would grow by 50% in next 5-7 years on account of rising per capita income of people living in these areas.
As per the current estimates, the percapita income of semi-urban population is Rs. 14,000 -15,000 per annum and that of a person in rural area is less than Rs. 7000 per annum. While per capita income of rural population would double by 2012, that of semi-urban people would more than double leading to a hike in their consumption patterns for FMCG products. This massive size and demand base offers huge opportunity for FMCG companies. In the process of expanding their operations into rural and semi-urban areas, these compnies will also generate huge employment in the hinterland of India.

Finer print of Bharti, Wal-Mart JV

Bharti's joint venture with Wal-Mart for cash-and-carry will be 50:50 one, with a condition that if any startegic or financial investor were to be brought in, then both partners will dilute stake equally.

The present policy restricts FDI in retail to single-brand ventures, with a cap of 51%. However, 100% FDI is permitted in wholesale cash-and-carry, where one can sell only to retailers and distributors, and not to the customers. besides, 100% FDI is also allowed under the automatic route inwarehousing services and refrigeration of agricultural products. While Bharti retail will enter into a franchise agreement with Wal-Mart for front-end retail, the two companies are forming a joint venture for the sourcing and cash-and-carry business. The first retail store under franchise may be opened on August 15 next year.
Bharti required the technology and the expertsie in logistics, supply chain management and cold chains and also needed to link up with the suppliers and producer communities and the tie-up with Wal-Mart would help towrards this.

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