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With the BSE Sensex sailing past the 6,000-mark last week, the Disinvestment Ministry must have heaved a sigh of relief. Until then, the pan...

Written by Sucheta Dalal

February 15, 2004 12:00 AM IST

5 min read

With the BSE Sensex sailing past the 6,000-mark last week, the Disinvestment Ministry must have heaved a sigh of relief. Until then, the panic over the mega PSU offerings was becoming clear to most market watchers. Not only were the PSU stock prices sliding as they corrected for expected influx in floating stock; but a volatile secondary market and dampened enthusiasm of the Foreign Institutional Investors were sending negative signals, especially about the size of the Gail and ONGC offers. The government countered the situation by piling on the goodies. The RBI, while making no attempt to check excessive funding, also told banks that there would be no limits on loans extended to PSU employees applying for shares in their employer company. It was announced that PSU shares may be offered at a 15 per cent discount to market as a buying opportunity for the retail investor. Will this hold true if the market remains buoyant next week?

Flu panic

After the SARS epidemic skipped India, the Asian influenza has also bypassed us and left the shining image intact. But while government organisations advertise the fact that India and its chicken are flu-free, there may be an interesting connection between stock markets bouncing back last week and the absence of flu. Top American fund managers have been carefully watching media reports and the hysteria over the avian flu. Wire agency reports that the flu virus H5N1 virus had spread to pigs, whose immunology system is very similar to human beings. Bloomberg had quoted the World Health Organization as saying that pigs are the ideal 8216;mixing vessel8217; for avian and human flu to combine DNA, creating viruses that are more deadly to people. This had raised the spectre of a 1918 type killer influenza called the 8216;Spanish flu8217;, which killed 20 million people. Money managers were worried that such a pandemic could disrupt world travel business and force a closure of national borders to contain the problem. While money managers were watching the situation carefully, the fact that affected nations acted swiftly to contain the problem seems to have restored the 8216;feel good8217; factor and raised stock prices.

Feel-good factor

There is more good news for Konkan Railway Corporation KRC as it heads towards the March deadline to test-run its ambitious Skybus at Goa. The US patents authority has approved two more Skybus related patent applications that KRC chairman B. Rajaram had filed in 2001 and 2002. The first is patent No. 6688235 is for a 8216;Suspended Coach Transportation System8217; which covers the Skybus structure with its long hollow coach suspended on rails and supported by concrete pillars, to provide high capacity suspended lateral transportation. The second is for the safety mechanism for the Skybus No. 6679184 and is called a derailment arrester. It covers the method and apparatus needed to clear an immobilised and derailed suspended coach, to improve safety levels in the suspended coach system and to control damage in case of collision to coaches. Although the patents apparel may be a matter of detail, it certainly allows Skybus team to go into the test phase with greater confidence.

Parivar airline

With two weddings in the first family of the Sahara group, its main business that deals directly with the public has begun to fall apart. Sahara Airline flights, whose priority was to ferry wedding guests, were delayed by hours without even the courtesy of informing passengers. Angry scenes and frayed tempers were a common sight around Sahara counters, while its frazzled staff played dumb or turned rude. Even basic services such as tele-check-in worked if you were lucky to have an operator answer the telephone. Ironically, Sahara is the only airline with the pretension of an on-line, internet based tele check-in facility. But two months into 2004 it has either forgotten to update the booking calendar to 2004, or disconnected the facility. Or maybe, it wasn8217;t meant to work at all. What makes this rather sad is that the airline once seemed determined to give the two market leaders some serious competition, especially in terms of in-flight service. The experience of failed airlines such as Damania ought to prove that this is not a Family038; Friends business, which also offers a commercial service. The difference is that unlike Damania, the Sahara parivar has deep, almost bottomless pockets and apparently no worries about finance or pressure to earn profits.

Tailpiece: Ever since UTI Mutual Fund snapped up all the IL038;FS mutual fund schemes in a hush-hush deal, the Fund industry has been wondering about the price at which IL038;FS8217;s Assets Under Management moved over. Reliable sources tell us that UTI paid a mere Rs 60 crore to add almost Rs 2,500 in assets under management.

Email: suchetadalalyahoo.com

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