BIZ’ SCOPE – Empowering You!

(A weekly newsletter for IPE’ans)

Hyderabad | Vol 1 | Issue 3 ipe.bizscope@gmail.com Thursday 29 July 2010 | IPE Hyd | Price: ` 8.00

Financial Results: Banking Sector GadgeTrivia: Focus on Buzz about Apple iPhone4 issues
HDFC Bank net up 34% on higher credit growth
Robust credit growth and stable margins helped HDFC Bank post a Apple, Antennagate, and Why It's Time to Move On
34% rise in net profit at ` 812 crore for the quarter ended June 30. In the "There's an awful lot of hoopla about that iPhone antenna”. And while
same period last year, the bank had reported a net profit of ` 606 crore. there's much to criticize about Apple's response, we're glad to see they've
Gross advances for the quarter grew by 42 per cent. Of this, around stopped pretending as the problem doesn't exist. Apple spent most of the
10 per cent increase in advances was due to short-term one-time wholesale time last week defending the iPhone 4's antenna, using both data and
loans to the telecom sector. The incremental loan growth over the March rhetoric that was impressive in its scope.
quarter was 16 per cent. Defense No. 1: Life Sucks
According to Mr.Paresh Sukthankar, Executive Director, HDFC Apple's primary
Bank, “The loan demand for now seems healthy and we have usually defense is that every phone's
grown at levels higher than the system. With GDP expected to grow 8.5 reception sucks when you hold
per cent, it is likely that system level loan growth may be around 21 - 22 it. The company line from the
per cent,” he said. Net interest margin is likely to be stable at around 4 -4.3 very beginning: "Gripping any
per cent this year. mobile phone will result in
“The primary contributor to NIM is the deposit mix. If we can maintain a some attenuation of its antenna
reasonable CASA (current account savings account) mix and the ratio of performance, with certain
retail and wholesale loans remains at 50:50, then margins should be places being worse than others
stable,” Mr Sukthankar said. This year, both yield on advances and cost of depending on the placement of
deposits is likely to move up, which would ensure stable margins. the antennas. This is a fact of
Lower profit from sale of investments at ` 21 crore (` 256 crore), pulled life for every wireless phone".
down other income by 10 per cent. Defense 2: Everything Is Just Great
Provisions: As gross non-performing assets were lower, provisions The iPhone 4 is using "a very advanced new antenna system.”In
declined to ` 555 crore (` 659 crore). Last year, provisions were higher as fact, Steve says it "is a more advanced antenna than ever has shipped on a
the bank was running off smart phone before”. And, later he says, "looking at the data, we don't
Centurion Bank's portfolio think we have a problem”.
and due to the economic Defense 3: We Made a Little Mistake, We're Being Exploited, But
slowdown, Mr Sukthankar Now Everything Is Fixed
said. Retail loans increased 24 If you want to boil it all down, Steve says, "The heart of the
per cent and constituted 51.5 problem is: Smart phones have weak spots. We made ours extremely
per cent of gross advances. visible. Some took advantage of that to demonstrate it. It was very easily
Unsecured lending is 20 per demonstrable. We screwed up on displaying too many bars and made that
cent of retail loan book, but it demonstration more theatrical than it needed to be".
is growing at a slower pace Defense 4: It's a Little Problem
than secured loans, he added. See all those numbers? It's a little problem. We work hard. We love
Shares of HDFC Bank closed you. We make great stuff. We're giving out free cases. Stop talking about
at `2,050.35, up 0.57 per cent from the previous close of `2038.7, on the this. Steve says, "We've been working really, really hard for the last 22
BSE. days to try to understand what the real problem is, so that when we solve
- KK it, we actually solve it, rather than just putting a bandaid on it."
The Upshot
Mumbai’s Dabbawala’s So! There is a problem with a particular point on the iPhone 4's
Are you hungry? U can order a external antenna. When you touch that single point with bare skin, you
Dominos Pizza by calling Domino’s. But, lose signal strength—around 24dB, to precise. Everyone would've talked
if u want someone to bring home food about how much they love their iPhone anyway from the very beginning.
right from your home, then you got to be The iPhone 4 is a fantastic phone—among the best yet made—and the
in Mumbai. Yes, through dabbawala’s. antenna issue may dent its crown, but doesn't dethrone it.
These dabbawala’s collect the cooked - KK
food in lunch boxes from the houses, and AD SPACE
deliver it to de respective place. This
uninterrupted service started in 1880 with
100 men and now it reached to 5000 men
delivering two lack lunch boxes daily.
In the morning, Dabbawals’s
collect the cocked food from house and keep it in a box which has coding.
They reach the nearby railway station and sort out the boxes according to
the coding given for specific destination stations. At the respective station,
another set of dabbawala’s quickly collect the boxes meant to be
distributed in that area and the remaining will be pushed to the next
railway station. Each dabbawala carries 35 to 40 boxes on a tray, and
deliver it to the respective persons according to the coding. After lunch Business plan happens again and this time in PGDM-A,
hours the process starts again in reverse to deliver the empty boxes back to This B-plan was different and it took everyone back to their
respected houses. school days, where they were given two maps and asked
Forbes awarded the dabbawala’s, a Six-Sigma performance rating, to mark the places.
a term used in quality assurance if the percentage of correctness is 99.9999 Gowtam Patankar and Zuhair Ali stood first and won
or more. In other words, for every six million Tiffin’s delivered, only one Parker pen from the Organizers.
fails to arrive. It even got world's 'best time management award' and From: Naveen kumar, Niharika Rao, Naveen Dava,
marked in “Guinness book of world records”. Nayeemudhin and Nikhil Rammaiah
- Kaushik Reddy

Business means empowering you! Page 1

 He transformed Wipro into one of India's most successful IT
Stock basics 3: Trading in stock Market companies. Under Azim Premji's stewardship, Wipro has grown from a
fledgling Rs 70 million oil company into an IT giant with a turnover of
$2.4 billion and an employee strength of 57,000.
The stock market system is an avenue of how to trade stock for
Azim Premji has regularly featured in the Forbes' list of the world's richest
listed corporations. As a corporation is formed, its initial shareholders are
people. He was also rated among the world's 100 most influential people
able to acquire shares of stock from the point of subscription when a
by the Time magazine. In 2005, the Indian government honored him with
company is created. When a company starts to be traded to the public, the
Padma Bhushan, one of the nation's highest civilian awards.
primary market comes in where those who subscribe to the initial public - Karthik Ch
offering (IPO) takes on the shares of stock sold from point of IPO. When AD SPACE
those who bought into a company at IPO point of view decides to sell their
shares of stock to other people, they can do so by going to the stock
market.
The stock market is a secondary market for securities trading
wherein original or secondary holders of a company’s shares of stock can As a Business plan we are planning to organize Tambola, on
sell their stocks to other individuals within the frame work of the stock 3rd to 7th August, 2010.
market system. The stock market has buyers of stocks or those who wants
to own a part of the MANY PRIZES TO BE WON
company but wasn’t Hurry Up.
able to do so during the
initial public offerings
made by the company Last day for the sale of Tickets:
to the public when it 3rd August
has decided to list itself Contact:
as a publicly listed Sruthi K (sruthi.kalidindi@gmail.com)
company. The Tejaswi R (tejaswi.rayapu@gmail.com)
secondary market or the Tej Prakash (tej555@gmail.com)
stock market allows
other individuals to sell
shares of the company
when the initial shareholders may have realized that they want to sell their Management Guru: Peter F. Drucker
shares after gaining either significant profit or realized significant loss Peter Drucker’s groundbreaking work turned modern management
from point of acquiring a company from its IPO price. theory into a serious discipline, and he influenced or created nearly every
facet of its application, including decentralization, privatization, and
"Most people get interested in stocks when everyone else is. The time to empowerment, and has coined such terms as the “knowledge worker.”
get interested is when no one else is. You can't buy what is popular and do Dr. Drucker cared not just about how business manages its
well” – Warren Buffet resources, but also how public and private organizations operate morally
- Kaushik reddy and ethically within society. He respected the values of education, personal
responsibility and businesses’ accountability to society. Dr. Drucker’s true
Faculty Corner: legacy is his insistence on this value system, and its effect on business,
society and individual lives.
Movies to watch: Born November 19, 1909, in Vienna,
• 12 Angry Men Drucker was educated in Austria and England
• The Sound of Music and earned a doctorate from Frankfurt
• Shrek 1, 2 and 3 – Animation University in 1931. He became a financial
reporter for Frankfurter General Anzeiger in
• Toy Story
Frankfurt, Germany, in 1929, which allowed
• Finding Nemo
him to immerse himself in the study of
• Seabiscuit
international law, history and finance.
• The Rogue Trader In 1939, Drucker landed a part-time
• The Negotiator teaching position at Sarah Lawrence College
• Air Force One in New York. He joined the faculty of
• Bruce Almighty Bennington College in Vermont in 1942 and the next year put his
• The Fugitive academic career on hold to spend two years studying the management
• Notting Hill structure of General Motors. This experience let to his book "Concept of
• Erin Brockovich the Corporation," an immediate bestseller in the United States and Japan,
• Blast from the Past which validated the notion that great companies could stand among
• George of the Jungle humankind's noblest inventions.
• Drucker's work had a major influence on modern organizations and
Ebooks: their management over the past 60 years. Valued for keen insight and the
http://www.arvindguptatoys.com/ ability to convey his ideas in popular language, Drucker often set the
http://esnips.com/web/eb00ks?docsPage=1 agenda in management thinking. Central to his philosophy is the view
- Special thanks:: Prof V Lalita that people are an organization's most valuable resource, and that a
manager's job is to prepare and free people to perform
Drucker's ideas have been disseminated in his 39 books, which
CEO Corner: Azim H Premji have been translated into more than 30 languages. His works range from
1939's "The End of the Economic Man" to "Managing in the Next Society"
Azim Hashim Premji, the chairman of Wipro Technologies, is one and "A Functioning Society," both published in 2002 and "The Daily
of the richest Indians. He is an icon among Indian businessmen, especially Drucker," released in 2004. His last book coauthored with Joseph A.
in the software industry. Born on July 24, 1945, Premji was studying Maciariello, "The Effective Executive in Action" was published by Harper
Electrical Engineering at Stanford University, USA when due to the Collins in January of 2006.
sudden demise of his father; he was called upon to handle the family Drucker was awarded the Presidential Medal of Freedom in July
business at the age of 21. 2002 by President George W. Bush in recognition for his work in the field
Wipro was then Western Indian Vegetable Products, a small of management. He received honorary doctorates from universities in the
cooking oil company. Premji diversified into bakery fats, ethnic ingredient United States, Belgium, Czechoslovakia, Great Britain, Japan, Spain and
based toiletries, hair care soaps, baby toiletries, lighting products and Switzerland.
hydraulic cylinders. And then shifted focus from soaps to software. Dr. Drucker died in November 2005, at the age of 95, at his home in
Claremont, California.
- Kranthi Kumar

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