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#Linkfest: Lousy Real Estate Fund, Whistleblowers and Shady GDP Adjustments


At Capitalmind Premium, we have a very active Slack channel where we discuss a lot of interesting topics. In there,  a number of interesting links come our way. Here’s a list:

  1. ​​​​​​​​​​​​​​If you thought that you could blindly trust the ratings given by these rating agencies, think again. Not only have mutual fund houses funded Yes Bank’s promoter against his personal holdings, they have been funding other promoters as well. These shares are not even pledged to the mutual funds. So the promoters are free to sell them off, and the funds holding the paper can’t do much. A broad day light scandals.
  2. Real estate is a volatile market. We all know that. So funds that invest in companies that are engaged in real estate business are equally risky. How risky? Well, take a look at Aditya Birla Real Estate Fund. Commenced in 2010, it should have given its investors all their money by now. But, unfortunately that hasn’t been the case.
  3. One of the ways to make yourself look good is to make the one standing next to you look bad.  The change in the methodology of calculating the economic performance from GDP to GVA, and bringing the base year from 2004-05 to 2011-12, has made the progress made under the current government (7.35%) look better than the previous government (6.7%). This has not gone down well with many experts because the numbers can’t really be compared.
  4. The healthcare sector could be worth $372 billion by 2022, and Manipal Hospitals along with its investors, TPG Capital and Temasek, are looking to grab as much of a share in this pie as possible. And they plan to do this by acquiring Medanta.
  5. Jet Airways doesn’t want to give up its frequent flyer program arm, Jet Privilege Pvt. Ltd – even if a higher valuation is offered. Staying closely connected to their loyal customers is something they want to continue doing via Jet Privilege Pvt. Ltd.
  6. If a banks could have nightmares, they would dream about suddenly turning into Yes Bank. The troubles don’t seem to end anytime soon for the private bank. Now RBI is looking for any possible exposure of Yes Bank to IL&FS, DHFL, Indiabulls Group, Fortune Financial Services India and Suraksha ARC.
  7. As a case in point of what happens when a well planned strategy goes down the drain, Thomas Cook Group Plc went down 24% in London (one-third of their value) and so did their bonds. This happened simply because they locked up hotel rooms and bulked up its jet fleet based on the fact that summer vacations would fetch a lot of travelers. Unfortunately, the European weather had different plans. The record high heat led millions of potential customers to stay back at home for the holidays.
  8.  JBM Solaris Electric Vehicle is set to launch an electric bus project which will create employment for close to two lakh people. This is also because the joint venture is currently functioning on the “locally sourced” ideology.
  9. So ICRA downgraded Yes Bank’s long term rating, and now, so did Moody’s Investor Service. It downgraded the ratings to non-investment grade and changed the outlook from stable to negative.
  10. Nifty 50 is now cheaper than before, thanks to liquidity crunch, rising crude and weaker rupee. And still, it’s one of the most expensive indices in the world.
  11. This festive season may not be going very well for many of the top corporate leaders. JM Financial has a large subsidiary, whose independent director Anil Khandelwal, a former chairman and managing director of Dena Bank and Bank of Baroda, recently resigned citing governance issues.
  12. Every time a whistle blower blows a whistle, some one or the other is in trouble. This time its Sun Pharma. The unnamed person has hinted that the promoter along with his brother in law and several foreign entities have been involved in illegal and questionable transactions in the Indian equity market.
  13. China doesn’t trust U.S.A and vice versa. A new agreement between the Trump led US and the Xi led Chinese tries to get things back in order. This agreement is basically on a 90-days test drive, post which U.S.A could revert back and raise the tariffs as and how they deem fit.
  14. While Bengaluru’s Bellandur lake catches fire every now and often and no one bats an eye (except few media houses who yell either because they care or when they have nothing else to report), China has ordered all paper mills near Dongting Lake be closed by 2019. This is in order to ensure there’s no water pollution in their second largest freshwater lake.​​​​​​​

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