Zeno Tech Labsssssssssssssss....................
Trading around :119rs in Bse
Y it will increase...
1. B'coz it is Pharma company(not a cyclic business & day/day diseases increase)
2. Ranbaxy holds 6.94% of the equity...(5 years back ranbay holds 10% in Matrix labs which is a winner now)
3.It is promoted by chigurupati jayaram (who is award padmasri)
4. Rakesh Jhunjhunwala holds some stake in this company(holds 3.12%).....
5. B'coz...Ram k Kodali..like this stock (:
6.Entering to us marker
Visit this site to know more www.zenotechlabs.com
Disclosure: holds just 200 shares @ 117.20
Total Equity : 288.11
Gross Sales : 22.81
Net Profit : -9.21
In Million Rs /quater
Wednesday, April 11, 2007
India's Richest Lady
There must have been a time when Kiran Mazumdar-Shaw was neither wealthy nor famous, but it is difficult now to imagine that period. She has been one of Bangalore’s icons for at least a decade. Kiran was famous in Bangalore well before she was wealthy, and she was wealthy well before she became famous elsewhere. Bangalore had felt her future long before the rest of the country did.
In those days, even a few years ago, you could bump into her at important occasions in the city. She was present during cricket matches, big concerts, conferences, charity runs…
Kiran made news by her sheer presence. You could spot her photograph in the newspapers the next day, cheering the Indian cricket team or attending an Elton John concert. The parties at her Koramangala residence those days were events in themselves. Then she became the wealthiest woman in India.
After Biocon was listed in the stock exchange, Kiran began to slowly move away from the public scene in Bangalore. She began attending fewer public functions. She started throwing fewer parties. Even at Bangalore Bio, an annual biotech conference originally conceived and nurtured by her, Kiran is no longer the presence she once was. She was Bangalore’s most visible corporate figure before Biocon went public, even more visible than Azim Premji or Narayana Murthy. But it seemed that her wealth, even if only in stockmarket terms, drew her away from public life. She became shy.
We are joking of course. This is a true joke. Call it a coincidence, but as her wealth grew, Kiran had less and less time to spend it. This is true of most entrepreneurs, but with Kiran Mazumdar-Shaw this trend took a special significance. She enjoyed running her business, but she enjoyed her public life too. She also enjoyed the fine things in life. Her reputation in Bangalore was not just as an entrepreneur. She is known as an art collector, a socialite, the voice of the biotech industry, civic activist and even an event manager par excellence. Yet she has been dropping all these hats one by one. Why?
As a young woman, Kiran had not dreamt of becoming an entrepreneur. She was persuaded by Leslie Auchincloss, founder of Biocon Biochemicals, Ireland, to start a business in Bangalore in 1978. It was a difficult period financially for her family. “I had no money at that time,” says Kiran, “because my father had lost all his savings in a bad investment.” She hesitated long before taking the plunge, and that too only after Auchincloss assured her security.
Kiran has had an upper-middle class upbringing. Her father was a brew master at the UB Group and was wealthy enough for Kiran to get an all round education. “She had always had strong values,” says Neelima Roshan, her long-time friend. She developed fine tastes too. Kiran knew her Bangalore and people living there well. Her business went through tough times, but she hung on. “Over the years, I have been very impressed with her ability to remain focused,” says R.A. Mashelkar, director general, CSIR. It was well over a decade before Biocon showed signs of becoming a large company.
Focused as she was, Kiran also took a healthy interest in life around her. She organised public marches, worked with the police to create traffic awareness, threw parties, regularly spoke at public forums. She came to be known as an art collector. Kiran was also an equitable employer and looked after her employees well. “Kiran was a pioneer in Bangalore to introduce an egalitarian culture at the workplace,” says Vijay Chandru, CEO, Strand Genomics and a thoroughbred Bangalorean himself. Kiran was developing into a complete all rounder.
In those days, Kiran’s reputation in the city grew faster than her wealth. It was impossible not to notice her if you were in a position of some influence. A company like Biocon would always run into problems — finances, import restrictions, the tax regime, environment regulations — that were not easily solved. Kiran would push hard at the system, refusing to budge till she got what she wanted. It was difficult to wish her away. She was tough even to the point of arrogance, but her arrogance grew from her passion for business rather than a sense of superiority. “She was incredibly persevering,” says Nitin Deshmukh, head of Kotak Mahindra Private Equity.
Her wealth began to grow by the end of the 1980s, and by the early 1990s, she was rich by upper-middle class standards. She built a large house in Koramangala, an upmarket locality in the city. She had had an aristocratic upbringing. Now she could create a matching lifestyle on her own. Her connections grew as her business expanded. Her social circle, already quite wide, expanded further. People noticed her style, her growing wealth, and they began to take her seriously. There was no woman like her in the city. She was becoming a celebrity.
In business, Kiran was known as a careful spender, she spotted opportunities well before others. But she invested carefully, shunning business fashion. Kiran seemed to be less frugal with her private wealth. She lived well, began driving a Mercedes and travelling often in first class. She was seen sporting a Cartier watch. She was holidaying in Maldives. She donated large sums of money to good causes, including Rs 1 crore once to improve Bangalore.
She was the pre-eminent spokesman of the biotechnology industry. Her world was never limited to herself or her company or even her city. “Kiran could always see the larger picture,” says Narayan Vaghul, former chairman, ICICI. She got involved with the conference Bangalore Bio, got other biotech entrepreneurs together to form an association and became a vocal spokesperson of the industry at the Centre. Then came the IPO. Life and business took a sharp turn.
The house in which Kiran Mazumdar-Shaw now lives was built by her husband John Shaw. It is a 17,000-sq. ft, sprawling bungalow designed by architect Sandip Khosla. People tend to associate this house with Kiran’s new-found wealth, but there is no connection. “If I had not married John, I could not have afforded this place,” Kiran had once told us. All his life, Shaw had nurtured dreams of living in such a place. He is the director (international business), Biocon.
Such close associations at home and office make personal and professional boundaries fuzzy. Your office moves into your home, and your home into the office. Shaw is also Kiran’s business partner, confidante, advisor, and even mentor (he brings 30 years of professional experience into his mentoring). Their house is a home, a resort, an office, a getaway, a meeting venue, a place of celebration, all within easy reach of the Biocon corporate office. The opulence of the house, called Glenmore, is striking even after several visits. Even more striking is the contrast between business prudence and personal extravagance. Glenmore is the venue of many parties and celebrations. Those who know her well know that Kiran does not waste money. Virtually all meetings, with one possible exception on New Year’s Eve, have a connection with business. Kiran and Shaw don’t hire a hotel to host a business party. She often brings her corporate guests home, and they inevitably go away impressed. She saves valuable time by not driving into the city. She also saves, paradoxically, valuable money by not hiring a hotel. What seems as indulgence turns into wisdom on closer examination. Kiran drives a Mercedes, but does not buy expensive jewellery. Mercedes is a business need. Jewellery is not.
Glenmore is a home, but it could be seen as an allegory to the company strategy by being a cluster of units with intimate connections. Visitors tend to linger at the connections, long passages decorated with paintings. Both Kiran and Shaw are art connoisseurs. “It is art that brought us together,” says Kiran. Even Glenmore is not big enough to display all the paintings. They are there in the passages, drawing and family rooms, courtyard and even in the bedrooms. They are stacked in some corners also. Kiran had been collecting religiously, even when she did not have enough money to spend. “I once paid for a Husain in three instalments,” she says. Her taste and caution reflects in her collection. She does not buy expensive paintings. An average purchase is worth Rs 15,000. She has also never sold a painting she has bought. Kiran is not an art investor; she just enjoys art.
Kiran loves to show you around the house, and takes particular care to show you the paintings. Yet, her most proud possession is not a painting but a drawing, done with no pretence to being art. It is a drawing of the double helix by James Watson, which she once found with her driver. Watson had sketched it casually, as an answer to a query from the driver —who had been asked to take special care of the Nobel Prize winner — about what he did for a living. Kiran has it beautifully framed and it looks almost surreal on her walls. Much as she has achieved, Kiran bows to genius, to achievement that she can only admire from a distance.
For years, Kiran managed her busy public life and her business with ease. Things began to change as Biocon grew as a large company. The two years after IPO also coincided with an inflection point in Biocon’s growth. She had to focus more on company strategies and less on other matters. The wider world, it seemed, was becoming distant. Over the years, Kiran had not just built a company. She had also built a set of companies and a team of entrepreneurs. All the business heads in Biocon functioned as surrogate entrepreneurs enjoying full freedom to do what they wanted, while Kiran formulated the broad strategy and functioned as the ambassador. Biocon was now being reborn. Kiran has to oversee it closely.
Life also changed when Kiran and Shaw moved to Glenmore. They were now away from the city, which made it difficult for her to attend functions in the city regularly. The biotech industry was still close to her heart. Over the last few years, Kiran had been trying hard to solve the biotech industry’s problems. “All the years I have known Kiran, she has talked to me only about the industry’s issues,” M.K. Bhan, secretary, Department of Biotechnology, had told BW recently. Kiran had impelled the biotech industry as far as it could go. Now that Biocon is entering a different league of companies, it is time to turn around and push it with all her strength.
In those days, even a few years ago, you could bump into her at important occasions in the city. She was present during cricket matches, big concerts, conferences, charity runs…
Kiran made news by her sheer presence. You could spot her photograph in the newspapers the next day, cheering the Indian cricket team or attending an Elton John concert. The parties at her Koramangala residence those days were events in themselves. Then she became the wealthiest woman in India.
After Biocon was listed in the stock exchange, Kiran began to slowly move away from the public scene in Bangalore. She began attending fewer public functions. She started throwing fewer parties. Even at Bangalore Bio, an annual biotech conference originally conceived and nurtured by her, Kiran is no longer the presence she once was. She was Bangalore’s most visible corporate figure before Biocon went public, even more visible than Azim Premji or Narayana Murthy. But it seemed that her wealth, even if only in stockmarket terms, drew her away from public life. She became shy.
We are joking of course. This is a true joke. Call it a coincidence, but as her wealth grew, Kiran had less and less time to spend it. This is true of most entrepreneurs, but with Kiran Mazumdar-Shaw this trend took a special significance. She enjoyed running her business, but she enjoyed her public life too. She also enjoyed the fine things in life. Her reputation in Bangalore was not just as an entrepreneur. She is known as an art collector, a socialite, the voice of the biotech industry, civic activist and even an event manager par excellence. Yet she has been dropping all these hats one by one. Why?
As a young woman, Kiran had not dreamt of becoming an entrepreneur. She was persuaded by Leslie Auchincloss, founder of Biocon Biochemicals, Ireland, to start a business in Bangalore in 1978. It was a difficult period financially for her family. “I had no money at that time,” says Kiran, “because my father had lost all his savings in a bad investment.” She hesitated long before taking the plunge, and that too only after Auchincloss assured her security.
Kiran has had an upper-middle class upbringing. Her father was a brew master at the UB Group and was wealthy enough for Kiran to get an all round education. “She had always had strong values,” says Neelima Roshan, her long-time friend. She developed fine tastes too. Kiran knew her Bangalore and people living there well. Her business went through tough times, but she hung on. “Over the years, I have been very impressed with her ability to remain focused,” says R.A. Mashelkar, director general, CSIR. It was well over a decade before Biocon showed signs of becoming a large company.
Focused as she was, Kiran also took a healthy interest in life around her. She organised public marches, worked with the police to create traffic awareness, threw parties, regularly spoke at public forums. She came to be known as an art collector. Kiran was also an equitable employer and looked after her employees well. “Kiran was a pioneer in Bangalore to introduce an egalitarian culture at the workplace,” says Vijay Chandru, CEO, Strand Genomics and a thoroughbred Bangalorean himself. Kiran was developing into a complete all rounder.
In those days, Kiran’s reputation in the city grew faster than her wealth. It was impossible not to notice her if you were in a position of some influence. A company like Biocon would always run into problems — finances, import restrictions, the tax regime, environment regulations — that were not easily solved. Kiran would push hard at the system, refusing to budge till she got what she wanted. It was difficult to wish her away. She was tough even to the point of arrogance, but her arrogance grew from her passion for business rather than a sense of superiority. “She was incredibly persevering,” says Nitin Deshmukh, head of Kotak Mahindra Private Equity.
Her wealth began to grow by the end of the 1980s, and by the early 1990s, she was rich by upper-middle class standards. She built a large house in Koramangala, an upmarket locality in the city. She had had an aristocratic upbringing. Now she could create a matching lifestyle on her own. Her connections grew as her business expanded. Her social circle, already quite wide, expanded further. People noticed her style, her growing wealth, and they began to take her seriously. There was no woman like her in the city. She was becoming a celebrity.
In business, Kiran was known as a careful spender, she spotted opportunities well before others. But she invested carefully, shunning business fashion. Kiran seemed to be less frugal with her private wealth. She lived well, began driving a Mercedes and travelling often in first class. She was seen sporting a Cartier watch. She was holidaying in Maldives. She donated large sums of money to good causes, including Rs 1 crore once to improve Bangalore.
She was the pre-eminent spokesman of the biotechnology industry. Her world was never limited to herself or her company or even her city. “Kiran could always see the larger picture,” says Narayan Vaghul, former chairman, ICICI. She got involved with the conference Bangalore Bio, got other biotech entrepreneurs together to form an association and became a vocal spokesperson of the industry at the Centre. Then came the IPO. Life and business took a sharp turn.
The house in which Kiran Mazumdar-Shaw now lives was built by her husband John Shaw. It is a 17,000-sq. ft, sprawling bungalow designed by architect Sandip Khosla. People tend to associate this house with Kiran’s new-found wealth, but there is no connection. “If I had not married John, I could not have afforded this place,” Kiran had once told us. All his life, Shaw had nurtured dreams of living in such a place. He is the director (international business), Biocon.
Such close associations at home and office make personal and professional boundaries fuzzy. Your office moves into your home, and your home into the office. Shaw is also Kiran’s business partner, confidante, advisor, and even mentor (he brings 30 years of professional experience into his mentoring). Their house is a home, a resort, an office, a getaway, a meeting venue, a place of celebration, all within easy reach of the Biocon corporate office. The opulence of the house, called Glenmore, is striking even after several visits. Even more striking is the contrast between business prudence and personal extravagance. Glenmore is the venue of many parties and celebrations. Those who know her well know that Kiran does not waste money. Virtually all meetings, with one possible exception on New Year’s Eve, have a connection with business. Kiran and Shaw don’t hire a hotel to host a business party. She often brings her corporate guests home, and they inevitably go away impressed. She saves valuable time by not driving into the city. She also saves, paradoxically, valuable money by not hiring a hotel. What seems as indulgence turns into wisdom on closer examination. Kiran drives a Mercedes, but does not buy expensive jewellery. Mercedes is a business need. Jewellery is not.
Glenmore is a home, but it could be seen as an allegory to the company strategy by being a cluster of units with intimate connections. Visitors tend to linger at the connections, long passages decorated with paintings. Both Kiran and Shaw are art connoisseurs. “It is art that brought us together,” says Kiran. Even Glenmore is not big enough to display all the paintings. They are there in the passages, drawing and family rooms, courtyard and even in the bedrooms. They are stacked in some corners also. Kiran had been collecting religiously, even when she did not have enough money to spend. “I once paid for a Husain in three instalments,” she says. Her taste and caution reflects in her collection. She does not buy expensive paintings. An average purchase is worth Rs 15,000. She has also never sold a painting she has bought. Kiran is not an art investor; she just enjoys art.
Kiran loves to show you around the house, and takes particular care to show you the paintings. Yet, her most proud possession is not a painting but a drawing, done with no pretence to being art. It is a drawing of the double helix by James Watson, which she once found with her driver. Watson had sketched it casually, as an answer to a query from the driver —who had been asked to take special care of the Nobel Prize winner — about what he did for a living. Kiran has it beautifully framed and it looks almost surreal on her walls. Much as she has achieved, Kiran bows to genius, to achievement that she can only admire from a distance.
For years, Kiran managed her busy public life and her business with ease. Things began to change as Biocon grew as a large company. The two years after IPO also coincided with an inflection point in Biocon’s growth. She had to focus more on company strategies and less on other matters. The wider world, it seemed, was becoming distant. Over the years, Kiran had not just built a company. She had also built a set of companies and a team of entrepreneurs. All the business heads in Biocon functioned as surrogate entrepreneurs enjoying full freedom to do what they wanted, while Kiran formulated the broad strategy and functioned as the ambassador. Biocon was now being reborn. Kiran has to oversee it closely.
Life also changed when Kiran and Shaw moved to Glenmore. They were now away from the city, which made it difficult for her to attend functions in the city regularly. The biotech industry was still close to her heart. Over the last few years, Kiran had been trying hard to solve the biotech industry’s problems. “All the years I have known Kiran, she has talked to me only about the industry’s issues,” M.K. Bhan, secretary, Department of Biotechnology, had told BW recently. Kiran had impelled the biotech industry as far as it could go. Now that Biocon is entering a different league of companies, it is time to turn around and push it with all her strength.
Indian Warren Buffet
Housewives in surburban Andheri, hooked to the stockmarket ticker, swoon at the mention of his name. Billed by the financial media as the Pied Piper of the Indian bourses, it is not unusual for owners and CEOs of India’s leading companies to drop into his Nariman Point office, funding proposals in hand, for a coffee and a chat. Yet, Rakesh Jhunjhunwala, the man who built a gigantic fortune single-handedly during a 21-year relationship with the manic equity markets, is an ordinary man who found his calling early in his life and has pursued it well.
Ask him how wealth has changed his lifestyle, and Jhunjhunwala says: “From smoking Four Square cigarettes, I have graduated to 555s; from drinking Royal Challenge whisky, I have switched to Black Label and instead of a Maruti 800, I now own a Mercedes S-Class.”
Despite the Rs 1,735.86 crore that places him in the BW Billionaires’ listing, Jhunjhunwala has clung to his upper middle class roots. He still lives in his family home at Walkeshwar in downtown Mumbai. He bought his first property — a holiday home in nearby Lonavala — only in his 40s. His family doesn’t go to London and Paris every summer, like other Indian entrepreneurs and corporate chieftains. His last vacation was in Kashmir. And he still vividly recalls spending Rs 7,000 on an outfit for his wife.
It is quite apparent that he is no big spender, a trait corroborated by his wife, Rekha. “He is really careful with his money, but he doesn’t stop me from spending it,” she smiles. Jhunjhunwala is quick to retort with an indulgent smile at his spouse: “I want to live in peace.” The spark between the two is very much there. Jhunjhunwala considers Rekha his lucky mascot, and often buys stocks for her, besides spoiling her silly on birthdays by renting nightclubs and DJs. But even then, the middle class gene kicks in — the value-for-money man heads to Tanishq, a brand known for its quality, to buy her jewels.
So, if money isn’t the driving force behind him, what makes him one of India’s canniest value investors? Our bet is that the man seeks excitement. For him, the adrenalin rush of the market is vital. And since he is not into car racing or flying in air balloons, the stockmarket is a perfect alternative for the man who says: “Life is a gamble.”
He has been obsessed with stock prices and balance sheets since boyhood. “The market was, is and will be his only passion,” says Rekha, recalling how her father-in-law had to shut down a crown caps manufacturing facility in Hyderabad as Rakesh refused to run it. Instead, after completing his chartered accountancy in 1985, he headed for the stockmarket.
The early days were tough, but Jhunjhunwala was unfazed. He wanted to be an independent professional and not kowtow to a corporate management team. “In 1986, I made my first big profit of Rs 15 lakh by selling 5,000 Tata Tea shares, which I bought for Rs 43 each, at Rs 140 in three months.”
Jhunjhunwala attributes his success to plain old common sense rather than intelligence. “You have to tap a good investment, one that comprises a business that is scalable, and then just hold on to it,” he says. He has done just that with the Pantaloon stock, which he bought before the Indian markets took off and holds a 1.85 per cent stake valued at Rs 97.31 crore as on 31 March. He also believes in a diversified portfolio. “Buy few companies, but in different businesses,” he says. A look at his portfolio (as on 31 March, 2006) reveals that he has invested in industries like media, hotels, information technology, retail, pharmaceuticals, banking and FMCG (see tables).
Jhunjhunwala says it takes time to make money. “I made 50 per cent of my wealth in five years (remember he has been trading for over two decades).” Which five? Probably the last five years, though he ducks the question by saying that 2005 was a “bumper year”.
For him, the excitement doesn’t end with hot stock picks. “He likes to party, either at home or outside,” says Rekha. He is often seen with family and friends at his favourite haunts among the city’s eateries and lounges. He even has a full-fledged discotheque in his Lonavala home for his weekends there.
Despite the hectic socialising, Jhunjhunwala is a workaholic and his eyes are glued to the screen practically 24 hours. Stockmarket reporters will tell you of interviews with him, during which he keeps a close eye on the ticker and business news, and makes deals at the same time.
His other obsession is his two year-old daughter, Nishtha, born to the couple after 18 years of marriage. “He wants to drop her to school at 9 a.m. and then go to work, despite wrapping up the day at 10 p.m. I often bring her to his office so that he can spend time with her,” says Rekha. The birth of his daughter has also kindled an interest in philanthropy. Jhunjhunwala proudly displays a model of a 57,000-sq. ft complex in Panvel that will house 400 homeless children. “For our daughter’s first birthday party, we invited 500 underprivileged children to Bowling Co. (in mid-town Parel),” says Rekha.
There is, thus, a soft side to the successful investor. “When I think of Rakesh Jhunjhunwala, I think of Crisil. He got Standard & Poor’s (S&P) to pay Crisil the right price,” says the head of an Indian private equity fund. (In 2005, S&P, through an open offer, became a majority shareholder in Crisil, where Jhunjhunwala had an over 14 per cent stake. He still retains about 5 per cent.) “I see no reason why he will not continue to be one of the country’s large private investors,” she adds.
Ask him how wealth has changed his lifestyle, and Jhunjhunwala says: “From smoking Four Square cigarettes, I have graduated to 555s; from drinking Royal Challenge whisky, I have switched to Black Label and instead of a Maruti 800, I now own a Mercedes S-Class.”
Despite the Rs 1,735.86 crore that places him in the BW Billionaires’ listing, Jhunjhunwala has clung to his upper middle class roots. He still lives in his family home at Walkeshwar in downtown Mumbai. He bought his first property — a holiday home in nearby Lonavala — only in his 40s. His family doesn’t go to London and Paris every summer, like other Indian entrepreneurs and corporate chieftains. His last vacation was in Kashmir. And he still vividly recalls spending Rs 7,000 on an outfit for his wife.
It is quite apparent that he is no big spender, a trait corroborated by his wife, Rekha. “He is really careful with his money, but he doesn’t stop me from spending it,” she smiles. Jhunjhunwala is quick to retort with an indulgent smile at his spouse: “I want to live in peace.” The spark between the two is very much there. Jhunjhunwala considers Rekha his lucky mascot, and often buys stocks for her, besides spoiling her silly on birthdays by renting nightclubs and DJs. But even then, the middle class gene kicks in — the value-for-money man heads to Tanishq, a brand known for its quality, to buy her jewels.
So, if money isn’t the driving force behind him, what makes him one of India’s canniest value investors? Our bet is that the man seeks excitement. For him, the adrenalin rush of the market is vital. And since he is not into car racing or flying in air balloons, the stockmarket is a perfect alternative for the man who says: “Life is a gamble.”
He has been obsessed with stock prices and balance sheets since boyhood. “The market was, is and will be his only passion,” says Rekha, recalling how her father-in-law had to shut down a crown caps manufacturing facility in Hyderabad as Rakesh refused to run it. Instead, after completing his chartered accountancy in 1985, he headed for the stockmarket.
The early days were tough, but Jhunjhunwala was unfazed. He wanted to be an independent professional and not kowtow to a corporate management team. “In 1986, I made my first big profit of Rs 15 lakh by selling 5,000 Tata Tea shares, which I bought for Rs 43 each, at Rs 140 in three months.”
Jhunjhunwala attributes his success to plain old common sense rather than intelligence. “You have to tap a good investment, one that comprises a business that is scalable, and then just hold on to it,” he says. He has done just that with the Pantaloon stock, which he bought before the Indian markets took off and holds a 1.85 per cent stake valued at Rs 97.31 crore as on 31 March. He also believes in a diversified portfolio. “Buy few companies, but in different businesses,” he says. A look at his portfolio (as on 31 March, 2006) reveals that he has invested in industries like media, hotels, information technology, retail, pharmaceuticals, banking and FMCG (see tables).
Jhunjhunwala says it takes time to make money. “I made 50 per cent of my wealth in five years (remember he has been trading for over two decades).” Which five? Probably the last five years, though he ducks the question by saying that 2005 was a “bumper year”.
For him, the excitement doesn’t end with hot stock picks. “He likes to party, either at home or outside,” says Rekha. He is often seen with family and friends at his favourite haunts among the city’s eateries and lounges. He even has a full-fledged discotheque in his Lonavala home for his weekends there.
Despite the hectic socialising, Jhunjhunwala is a workaholic and his eyes are glued to the screen practically 24 hours. Stockmarket reporters will tell you of interviews with him, during which he keeps a close eye on the ticker and business news, and makes deals at the same time.
His other obsession is his two year-old daughter, Nishtha, born to the couple after 18 years of marriage. “He wants to drop her to school at 9 a.m. and then go to work, despite wrapping up the day at 10 p.m. I often bring her to his office so that he can spend time with her,” says Rekha. The birth of his daughter has also kindled an interest in philanthropy. Jhunjhunwala proudly displays a model of a 57,000-sq. ft complex in Panvel that will house 400 homeless children. “For our daughter’s first birthday party, we invited 500 underprivileged children to Bowling Co. (in mid-town Parel),” says Rekha.
There is, thus, a soft side to the successful investor. “When I think of Rakesh Jhunjhunwala, I think of Crisil. He got Standard & Poor’s (S&P) to pay Crisil the right price,” says the head of an Indian private equity fund. (In 2005, S&P, through an open offer, became a majority shareholder in Crisil, where Jhunjhunwala had an over 14 per cent stake. He still retains about 5 per cent.) “I see no reason why he will not continue to be one of the country’s large private investors,” she adds.
Monday, April 9, 2007
Telugu Channels
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http://www.jaynay.blogspot.com/
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http://rakodali.blogspot.com/
http://jkirankumar.blogspot.com/
http://satyakarnati.blogspot.com/
http://movies-sports.blogspot.com/
http://sivamoney.blogspot.com
Regional electronic media seems to have suddenly become a hot business option. Andhra Pradesh, which has the largest cable penetration, is witnessing an influx of new channels. Five new 24-hour news channels will go on air this year.
First among the soon-to-be-launched are NTV and TV5, promoted by Narendranath Chowdhary and B.R. Naidu, respectively. Chowdhary will invest Rs 20 crore and has roped in S.R. Ramanujan, the man behind ETV’s successive launch of 11 entertainment channels. On the other hand, TV5’s Naidu has hired I. Satyanarayana, from Vissa Television. Satyanarayana had earlier worked with ETV as a news coordinator.
While NTV and TV5 are gearing up for the launch, others — VTV, promoted by a group of NRIs, Hyderabad TV, promoted by small-time politician Malepalli Lakshmaiah and Telengana TV, promoted by political group TRS — are still in formative days.It is the lure of ad revenues that drives investment to regional electronic media. A 10 second slot (Rs 300) with an average eight-minute commercial break in a 30-minute news spread would fetch a cool Rs 25 crore annually. And if alternative advertisement sources — scrolls, tariff increase during peak hours, etc. are counted, annual revenues would cover most of the capital investment. Apparently, promoters can also gain instant recognition. The channel line-up in Andhra reflects the increasing interest among politicians to own their own channels.
Meanwhile, to ward off competition, TV9 decided to launch three more channels — music, cultural and entertainment — for the Telugu audience. “We are investing Rs 550 crore for this massive expansion,” says Ravi Prakash, CEO, TV9. The channel intends to consolidate its position blocking prime bands with cable distributors. “Unless the channel is leading, you end up paying exorbitant amounts for distribution,” says Prakash. For instance, Zee Telugu and Maa TV pay about Rs 10 lakh per month for distribution in Hyderabad alone. Three more channels from TV9 bouquet implies that forthcoming channels such as TV5 and NTV will have a tough time coping up with cable distributors.
All said, none of the existing players are perturbed by the impending launch of channels and the likely price war they can create. “Even if TV9 and the new channels compromise with rate cards, we will be left unscathed,” says a senior official from ETV2.
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Regional electronic media seems to have suddenly become a hot business option. Andhra Pradesh, which has the largest cable penetration, is witnessing an influx of new channels. Five new 24-hour news channels will go on air this year.
First among the soon-to-be-launched are NTV and TV5, promoted by Narendranath Chowdhary and B.R. Naidu, respectively. Chowdhary will invest Rs 20 crore and has roped in S.R. Ramanujan, the man behind ETV’s successive launch of 11 entertainment channels. On the other hand, TV5’s Naidu has hired I. Satyanarayana, from Vissa Television. Satyanarayana had earlier worked with ETV as a news coordinator.
While NTV and TV5 are gearing up for the launch, others — VTV, promoted by a group of NRIs, Hyderabad TV, promoted by small-time politician Malepalli Lakshmaiah and Telengana TV, promoted by political group TRS — are still in formative days.It is the lure of ad revenues that drives investment to regional electronic media. A 10 second slot (Rs 300) with an average eight-minute commercial break in a 30-minute news spread would fetch a cool Rs 25 crore annually. And if alternative advertisement sources — scrolls, tariff increase during peak hours, etc. are counted, annual revenues would cover most of the capital investment. Apparently, promoters can also gain instant recognition. The channel line-up in Andhra reflects the increasing interest among politicians to own their own channels.
Meanwhile, to ward off competition, TV9 decided to launch three more channels — music, cultural and entertainment — for the Telugu audience. “We are investing Rs 550 crore for this massive expansion,” says Ravi Prakash, CEO, TV9. The channel intends to consolidate its position blocking prime bands with cable distributors. “Unless the channel is leading, you end up paying exorbitant amounts for distribution,” says Prakash. For instance, Zee Telugu and Maa TV pay about Rs 10 lakh per month for distribution in Hyderabad alone. Three more channels from TV9 bouquet implies that forthcoming channels such as TV5 and NTV will have a tough time coping up with cable distributors.
All said, none of the existing players are perturbed by the impending launch of channels and the likely price war they can create. “Even if TV9 and the new channels compromise with rate cards, we will be left unscathed,” says a senior official from ETV2.
Blogs
If you have dismissed blogs as a new set of toys meant for the nerds and the jobless, you may have already lost a million potential clients. That is the message European and US companies are sending to India Inc. Swathes of western companies are seeing the power of the blog — in both fetching customers and improving image. Fortune 500 Business Blogging Wiki, a list of business blogs, reports that in February, 22 of the Fortune 500 companies ran blogs. Soon after, 18 more did. Charlene Li, vice-president and principal analyst, Forrester Research, estimates her blog posts were a catalyst that brought more than a million dollars to the Massachusetts, US-based company.
But most Indian businesses just do not seem to care. “Business blogging in India is only seen among early adopters, I cannot think of even a handful of CEO-level people blogging in India,” says Ajit Balakrishnan, CEO, Rediff.com, and one of India’s pioneer business bloggers. Balakrishnan says his blog is seen by around 800,000 readers a month. “This is many times the number that read any OpEd page in India. All CEOs should blog,” he adds.
Experts say businesses in India keep their eyes shut to blogs as many are organised around a control structure in which consumers are talked to, and not with. However, a few of the IT and media companies in India are starting to see the light. News channel CNN-IBN’s editor Rajdeep Sardesai, however busy he may be, blogs once a month on the channel’s website. Bangalore-based Infosys Technologies and Tekriti Software in Gurgaon are two other active users of blogs.
While blog analysts agree on their power as messaging tools, they warn that you need to be careful. “Use them to advance your interests but do not get carried away,” says Nicholas Carr, former executive editor of Harvard Business Review. “There is a lot of hype around blogs,” says Jacques Kemp, CEO, ING Asia-Pacific, a pioneer in financial corporate blogging. “So, be realistic about your expectations. We believe all sorts of businesses can make use of blogs for benefits.” Kemp says ING was the first financial company to launch an advisor blog (www.pickuradvisor.com) in India.
David Brain, president and CEO (Europe), Edelman, the world’s third-largest public relations agency, has a rule of thumb: “Use a blog to learn from consumers. Build credible support for your initiatives, and reach out to stakeholders. That will help you co-create a brand story and a reputation with thousands of online citizens participating passionately.” The idea of engaging ‘online citizens’ excites Rajeev Karwal, former head of consumer durables, Reliance Retail. “Social networking sites such as Orkut and Facebook will soon redefine the way we look at market segmentation,” he says, adding, “You come across clusters of people with similar interests. Is there any better way [than blogs] to take your message to them at once?”
An Edelman white paper says that, on average, two in every 10 blog readers have taken some sort of action as a result of reading a blog. In the case of Balakrishnan’s blog alone, that equates to 160,000 people. With the world increasingly going online, can India Inc. afford to miss out on such exposure?
Indian companies need to realise that if they do not tell their story, one of those millions of bloggers out there will. Blogs are not going away anytime soon.
But most Indian businesses just do not seem to care. “Business blogging in India is only seen among early adopters, I cannot think of even a handful of CEO-level people blogging in India,” says Ajit Balakrishnan, CEO, Rediff.com, and one of India’s pioneer business bloggers. Balakrishnan says his blog is seen by around 800,000 readers a month. “This is many times the number that read any OpEd page in India. All CEOs should blog,” he adds.
Experts say businesses in India keep their eyes shut to blogs as many are organised around a control structure in which consumers are talked to, and not with. However, a few of the IT and media companies in India are starting to see the light. News channel CNN-IBN’s editor Rajdeep Sardesai, however busy he may be, blogs once a month on the channel’s website. Bangalore-based Infosys Technologies and Tekriti Software in Gurgaon are two other active users of blogs.
While blog analysts agree on their power as messaging tools, they warn that you need to be careful. “Use them to advance your interests but do not get carried away,” says Nicholas Carr, former executive editor of Harvard Business Review. “There is a lot of hype around blogs,” says Jacques Kemp, CEO, ING Asia-Pacific, a pioneer in financial corporate blogging. “So, be realistic about your expectations. We believe all sorts of businesses can make use of blogs for benefits.” Kemp says ING was the first financial company to launch an advisor blog (www.pickuradvisor.com) in India.
David Brain, president and CEO (Europe), Edelman, the world’s third-largest public relations agency, has a rule of thumb: “Use a blog to learn from consumers. Build credible support for your initiatives, and reach out to stakeholders. That will help you co-create a brand story and a reputation with thousands of online citizens participating passionately.” The idea of engaging ‘online citizens’ excites Rajeev Karwal, former head of consumer durables, Reliance Retail. “Social networking sites such as Orkut and Facebook will soon redefine the way we look at market segmentation,” he says, adding, “You come across clusters of people with similar interests. Is there any better way [than blogs] to take your message to them at once?”
An Edelman white paper says that, on average, two in every 10 blog readers have taken some sort of action as a result of reading a blog. In the case of Balakrishnan’s blog alone, that equates to 160,000 people. With the world increasingly going online, can India Inc. afford to miss out on such exposure?
Indian companies need to realise that if they do not tell their story, one of those millions of bloggers out there will. Blogs are not going away anytime soon.
- Almost 175,000 new blogs created everyday
- More than 1.6 Million blog updates are posted online everyday
- 74% of Japan people read Blogs
- 43% of South Koreans read Blogs
- 39% of Chinese people read Blogs
- 27% of U.S people read Blogs
Sunday, April 8, 2007
Man who made 3 crores into 6000crs in 6years
Matrix Unloaded
N. Prasad bought a company for Rs 3 crore in 2000. He sold it for a valuation of Rs 6,210 crore. His story
The Making Of Matrix LabsUnusual he is. Part of the reason is that Prasad comes from a modest middle class background — his father was an army officer and mother a housewife — and he does not carry the baggage of inheritance. That gave him the stomach to take risks from the beginning. “I have little to lose,” he says.
Mylan’s headquarters in the US
A Master’s degree holder in chemistry (he later did an MBA while at his first job), Prasad started his career as a small-time analytical chemist with Indian Molasses, a New Delhi-based company. In 1993, when his mentor, P.A. Kumaran, then general manager at Indian Molasses, advised him to join pharma manufacturing, he decided to work at Plant Organics, an API supplier in Hyderabad, despite the fact that it was running huge losses. As general manager, he turned Plant Organics around in a year by convincing its largest API buyer Alkem Labs to pay more for the API and assuring greater supplies.
Plant Organics had a loss-making subsidiary called Vorin Labs. In 1995, a group of NRI investors bought out Plant Organics, and asked Prasad to run the show as managing director of Vorin. Vorin began supplying APIs to Ranbaxy, then led by D.S. Brar. Impressed with Prasad’s work, Ranbaxy took 38 per cent stake (they woud later raise it to 51 per cent) in Vorin. It was at this time that Prasad met Malik, who was with Ranbaxy as head (R&D) and, subsequently, on the board of Vorin Labs. Till now, Prasad was still just an employee. In 2000, he took his first leap of faith.
The Andhra Pradesh government had recently disallowed setting up of new plants in Hyderabad. For Prasad, who was bit by the entrepreneurial bug, the only route was to buy an existing plant. He found the perfect company in Herren Drugs and Pharmaceuticals, a Hyderabad-based company that was running into losses. Prasad and a business associate, N. Ravinder, bought the company for a mere Rs 3 crore. That money, too, was not easy to come by. They cobbled it together by borrowing. Prasad got the money at a whopping 48 per cent interest. He continued being managing director, Vorin — Herren was bought in his personal capacity.
Meanwhile, Ranbaxy wanted out because it did not really want a plant in Hyderabad, since its manufacturing was concentrated in the north and at strategic global locations. Prasad bought out Ranbaxy’s stake in Vorin by raising money through bank loans and merged it with Herren. Thus, in March 2001, was born Matrix Laboratories.
Prasad, meanwhile, kept going the extra mile if an opportunity presented itself. Shortly after Matrix was formed, Deepak Chhataraj, regional head (US), Ranbaxy, wanted to launch loratadine, an API for antihistamine. He wanted 3-4 tonnes of the API, but Ranbaxy could produce maximum 1 tonne. Prasad offered to do 3-4 tonnes himself (through Matrix) and without signing a formal agreement, put up a manufacturing block that must have cost him Rs 15 crore-20 crore. It was a large sum for a company of Matrix’s size, the first big order after Vorin and Herren were merged. Ultimately Ranbaxy could not place this order — and Prasad put it down to the travails of entrepreneurship.
Between 2002 and 2004, Matrix acquired a host of smaller Indian companies . Says Prasad: “Each acquisition that we made either added to the capacities or was strategically significant to our growth. The organic route would take too long. We wanted to grow fast.”
In November 2003, Matrix set up joint ventures (in India and Ireland) with two German companies. Sensing an opportunity, by March 2004, private equity players Temasek and Newbridge moved in and picked up a stake of 38 per cent between them. In July 2005, Matrix upped its stake in Explora Laboratories, a Mendrisio, Switzerland-based technology platform company. This acquisition added niche products in the oncology segment to Matrix’s portfolio.
Later that month, Matrix did its biggest acquisition, and the biggest deal by any Indian pharma company at that point — it bought 22 per cent stake for $263 million in Docpharma, a pharmaceutical trading company with a robust marketing and distribution network in western Europe. Says Prasad: “Matrix needed to enter the front end and a European acquisition gave us that. Moving into formulations and finished dosage form was a natural growth path for us.”
In January 2006, Matrix bought a 58 per cent stake in Mchem, a China-based manufacturing company. Mchem makes anti-retroviral APIs and gives Matrix the advantage of lowering prices in the segment using China’s manufacturing advantage.
Then, Matrix entered into two strategic joint ventures with Aspen Pharmacare, South Africa’s largest generic pharma company. Matrix had a strong anti-retroviral portfolio and joining hands with Aspen strengthened it further since together, the two companies had 25 products. It also gave Matrix access to niche, controlled-release products through Aspen’s subsidiary FCC.
Finally, Matrix acquired Concord Biotech in February 2006. None of these were random moves. They were calculated to take the once single product (citalopram) focused API supplier into the league of broad-based generic companies.
Prasad’s aim has always been to take Matrix into the global league. That has been realised with the acquisitions and now the deal with Mylan. With that ends one chapter in a remarkable career. And another begins.
MATRIX MAN: Prasad with Rambo, his pet dog
On a December evening last year, Nimmagadda Prasad, the soft-spoken and gentle-to-a-fault executive chairman of Hyderabad-based Matrix Laboratories, walked into the room of Rajiv Malik, CEO of the company. Earlier, in July, Malik had quit as head of global development and registration at Sandoz to join Matrix. A through-and-through R&D man, he was grappling with three M&As that Matrix had done recently — Docpharma of Belgium, Explora of Switzerland and Mchem of China. After discussing a few innocuous matters, Prasad casually passed an envelope to Malik. “Read it when you have time,” he said and walked out of the room.
Later that evening, Malik opened the envelope. In it was the profile of Concord Biotech, an Ahmedabad-based biotechnology outfit. He was shocked. “We had not even digested the earlier acquisitions when another one was thrown at me. I argued with Prasad. But he wouldn’t relent. He said that we would not get this opportunity again. I was stressed over the earlier acquisitions, but knew he was right,” recalls Malik.
Concord produces biological-based active pharmaceutical ingredients (APIs) targeted at the US market. It was an opportunity that simply could not be missed. And with big players like GlaxoSmithKline and Sandoz also eyeing Concord, Matrix had to move fast. That was Prasad’s point. That December itself, it acquired 55 per cent of Concord.
The Man They Call GodThere are many Prasads. His employees call him God. Sudhir Vaid, the scientist-turned-entrepreneur and managing director of Concord, says Prasad is the most transparent and fair person he has met. That’s why he sold his company to Matrix, despite there being bigger, more illustrious rivals in play. “I run Concord independently although the majority stake is held by Matrix. It is an ideal situation,” says Vaid.
Now talk to Prasad — and you’ll come away thinking that he is a philanthropist. In an interview from New York, he told BW he plans to give 50 per cent of his wealth to charity. Matrix employees say that Prasad often sponsors the higher education of some of their children. To Malik, who has known him for over a decade, Prasad is as an opportunistic risk-taker.
But what perhaps describes Prasad best is that he is an astute businessman with an instinctive sense of timing. One who bought a company for Rs 3 crore barely six years ago, and sold it for an enterprise valuation of Rs 6,210 crore last week.
The Mylan deal is clearly Prasad at his best. When he entered the pharma business in the late 1990s, the global generics and API businesses were just about opening up, with billions of dollars of products slated to go off patent. But in the last year or so, innovator companies have begun fighting back through a series of measures — launching authorised generics (where the innovator allows a single generics company to launch the genericised version of the drug), stiff legal countermeasures of patent challenges, sweetheart deals with generic companies and so on.
Predictably, margins are under pressure. And big generic players around the globe have begun consolidating, their numbers having come down from 14 to six in the last three years.
Prasad argues that alliances such as Matrix-Mylan are the way forward. “A player has to decide how he can stay in the field for as long as possible. Matrix, as a significant API supplier, needed a bigger playing field. Partnering with Mylan gives us that.”
Malik puts this in context. In July 2005, with an eye on the European market, Matrix had bought Docpharma, a pharmaceutical trading company with a robust marketing and distribution network in western Europe for $263 million. Docpharma was a smart buy — but Matrix was still absent in the US, the world’s largest pharma market. However, Matrix’s balance sheet did not allow it to enter the US market through, say, a $50-million acquisition any longer. Especially not after Docpharma.
“We could not make an acquisition that was substantial on a global scale. But we had an open mind to be in the business. The chairman provided the answer. To stay in the game, to create more value for the shareholder, and to protect employees’ interests, Matrix would sell,” says Malik. Indeed, as the next article argues, Prasad’s deal will perhaps trigger a round of consolidation in Indian pharma.
STILL IN THE SADDLE: Rajiv Malik, CEO, Matrix Labs, will continue to head its operations in India
Mylan was, of course, a great fit. Puneet Bhatia, managing director, Newbridge India and private equity investor in Matrix since 2004, says that though Mylan is not so well known in India, the company is the gold standard in the generics business in the US. “It has a very strong balance sheet and the highest profit margins.”
Moreover, in the last four years, Mylan has been buying APIs from Matrix. The leaders of the two companies, Prasad and Robert Coury, vice-chairman and CEO, Mylan, have immense respect for each other, even though the two met for the first time only last December.
Coury’s respect for Prasad was evident from his precondi tion for the merger — that Prasad join Mylan’s board. With his experience in global markets to back him up, Prasad will take over as head of global strategies at Mylan. (In India, the rest of the management team of Matrix will take the show forward under Malik as CEO. The other significant acquisition of Matrix, Docpharma, will continue to be managed by Stijn Van Rompay, the co-founder of the company.)
For Prasad, who started his career as an employee and moved on to be an entrepreneur, life has come full circle. It is perhaps not easy for an entrepreneur who has built a company to become an employee, albeit an immensely wealthy one with a shareholding to boot.
But Prasad makes it seem easy. “I should have a job because of my competence and not because of my share in the company.”
A year ago when he was CEO of Matrix and in charge of operations, he figured to take Matrix ahead, he needed someone of Malik’s calibre. The two have known each other since 1998. “To get Malik into Matrix, I could not offer him a post lower than that of the CEO,” says Prasad.
And so, active entrepreneur-CEO Prasad made way for Malik and made himself chairman of the company. “Kicking oneself upstairs in favour of a professional is something that is rare. But Prasad is unusual,” says Newbridge’s Bhatia.
N. Prasad bought a company for Rs 3 crore in 2000. He sold it for a valuation of Rs 6,210 crore. His story
The Making Of Matrix LabsUnusual he is. Part of the reason is that Prasad comes from a modest middle class background — his father was an army officer and mother a housewife — and he does not carry the baggage of inheritance. That gave him the stomach to take risks from the beginning. “I have little to lose,” he says.
Mylan’s headquarters in the US
A Master’s degree holder in chemistry (he later did an MBA while at his first job), Prasad started his career as a small-time analytical chemist with Indian Molasses, a New Delhi-based company. In 1993, when his mentor, P.A. Kumaran, then general manager at Indian Molasses, advised him to join pharma manufacturing, he decided to work at Plant Organics, an API supplier in Hyderabad, despite the fact that it was running huge losses. As general manager, he turned Plant Organics around in a year by convincing its largest API buyer Alkem Labs to pay more for the API and assuring greater supplies.
Plant Organics had a loss-making subsidiary called Vorin Labs. In 1995, a group of NRI investors bought out Plant Organics, and asked Prasad to run the show as managing director of Vorin. Vorin began supplying APIs to Ranbaxy, then led by D.S. Brar. Impressed with Prasad’s work, Ranbaxy took 38 per cent stake (they woud later raise it to 51 per cent) in Vorin. It was at this time that Prasad met Malik, who was with Ranbaxy as head (R&D) and, subsequently, on the board of Vorin Labs. Till now, Prasad was still just an employee. In 2000, he took his first leap of faith.
The Andhra Pradesh government had recently disallowed setting up of new plants in Hyderabad. For Prasad, who was bit by the entrepreneurial bug, the only route was to buy an existing plant. He found the perfect company in Herren Drugs and Pharmaceuticals, a Hyderabad-based company that was running into losses. Prasad and a business associate, N. Ravinder, bought the company for a mere Rs 3 crore. That money, too, was not easy to come by. They cobbled it together by borrowing. Prasad got the money at a whopping 48 per cent interest. He continued being managing director, Vorin — Herren was bought in his personal capacity.
Meanwhile, Ranbaxy wanted out because it did not really want a plant in Hyderabad, since its manufacturing was concentrated in the north and at strategic global locations. Prasad bought out Ranbaxy’s stake in Vorin by raising money through bank loans and merged it with Herren. Thus, in March 2001, was born Matrix Laboratories.
Prasad, meanwhile, kept going the extra mile if an opportunity presented itself. Shortly after Matrix was formed, Deepak Chhataraj, regional head (US), Ranbaxy, wanted to launch loratadine, an API for antihistamine. He wanted 3-4 tonnes of the API, but Ranbaxy could produce maximum 1 tonne. Prasad offered to do 3-4 tonnes himself (through Matrix) and without signing a formal agreement, put up a manufacturing block that must have cost him Rs 15 crore-20 crore. It was a large sum for a company of Matrix’s size, the first big order after Vorin and Herren were merged. Ultimately Ranbaxy could not place this order — and Prasad put it down to the travails of entrepreneurship.
Between 2002 and 2004, Matrix acquired a host of smaller Indian companies . Says Prasad: “Each acquisition that we made either added to the capacities or was strategically significant to our growth. The organic route would take too long. We wanted to grow fast.”
In November 2003, Matrix set up joint ventures (in India and Ireland) with two German companies. Sensing an opportunity, by March 2004, private equity players Temasek and Newbridge moved in and picked up a stake of 38 per cent between them. In July 2005, Matrix upped its stake in Explora Laboratories, a Mendrisio, Switzerland-based technology platform company. This acquisition added niche products in the oncology segment to Matrix’s portfolio.
Later that month, Matrix did its biggest acquisition, and the biggest deal by any Indian pharma company at that point — it bought 22 per cent stake for $263 million in Docpharma, a pharmaceutical trading company with a robust marketing and distribution network in western Europe. Says Prasad: “Matrix needed to enter the front end and a European acquisition gave us that. Moving into formulations and finished dosage form was a natural growth path for us.”
In January 2006, Matrix bought a 58 per cent stake in Mchem, a China-based manufacturing company. Mchem makes anti-retroviral APIs and gives Matrix the advantage of lowering prices in the segment using China’s manufacturing advantage.
Then, Matrix entered into two strategic joint ventures with Aspen Pharmacare, South Africa’s largest generic pharma company. Matrix had a strong anti-retroviral portfolio and joining hands with Aspen strengthened it further since together, the two companies had 25 products. It also gave Matrix access to niche, controlled-release products through Aspen’s subsidiary FCC.
Finally, Matrix acquired Concord Biotech in February 2006. None of these were random moves. They were calculated to take the once single product (citalopram) focused API supplier into the league of broad-based generic companies.
Prasad’s aim has always been to take Matrix into the global league. That has been realised with the acquisitions and now the deal with Mylan. With that ends one chapter in a remarkable career. And another begins.
MATRIX MAN: Prasad with Rambo, his pet dog
On a December evening last year, Nimmagadda Prasad, the soft-spoken and gentle-to-a-fault executive chairman of Hyderabad-based Matrix Laboratories, walked into the room of Rajiv Malik, CEO of the company. Earlier, in July, Malik had quit as head of global development and registration at Sandoz to join Matrix. A through-and-through R&D man, he was grappling with three M&As that Matrix had done recently — Docpharma of Belgium, Explora of Switzerland and Mchem of China. After discussing a few innocuous matters, Prasad casually passed an envelope to Malik. “Read it when you have time,” he said and walked out of the room.
Later that evening, Malik opened the envelope. In it was the profile of Concord Biotech, an Ahmedabad-based biotechnology outfit. He was shocked. “We had not even digested the earlier acquisitions when another one was thrown at me. I argued with Prasad. But he wouldn’t relent. He said that we would not get this opportunity again. I was stressed over the earlier acquisitions, but knew he was right,” recalls Malik.
Concord produces biological-based active pharmaceutical ingredients (APIs) targeted at the US market. It was an opportunity that simply could not be missed. And with big players like GlaxoSmithKline and Sandoz also eyeing Concord, Matrix had to move fast. That was Prasad’s point. That December itself, it acquired 55 per cent of Concord.
The Man They Call GodThere are many Prasads. His employees call him God. Sudhir Vaid, the scientist-turned-entrepreneur and managing director of Concord, says Prasad is the most transparent and fair person he has met. That’s why he sold his company to Matrix, despite there being bigger, more illustrious rivals in play. “I run Concord independently although the majority stake is held by Matrix. It is an ideal situation,” says Vaid.
Now talk to Prasad — and you’ll come away thinking that he is a philanthropist. In an interview from New York, he told BW he plans to give 50 per cent of his wealth to charity. Matrix employees say that Prasad often sponsors the higher education of some of their children. To Malik, who has known him for over a decade, Prasad is as an opportunistic risk-taker.
But what perhaps describes Prasad best is that he is an astute businessman with an instinctive sense of timing. One who bought a company for Rs 3 crore barely six years ago, and sold it for an enterprise valuation of Rs 6,210 crore last week.
The Mylan deal is clearly Prasad at his best. When he entered the pharma business in the late 1990s, the global generics and API businesses were just about opening up, with billions of dollars of products slated to go off patent. But in the last year or so, innovator companies have begun fighting back through a series of measures — launching authorised generics (where the innovator allows a single generics company to launch the genericised version of the drug), stiff legal countermeasures of patent challenges, sweetheart deals with generic companies and so on.
Predictably, margins are under pressure. And big generic players around the globe have begun consolidating, their numbers having come down from 14 to six in the last three years.
Prasad argues that alliances such as Matrix-Mylan are the way forward. “A player has to decide how he can stay in the field for as long as possible. Matrix, as a significant API supplier, needed a bigger playing field. Partnering with Mylan gives us that.”
Malik puts this in context. In July 2005, with an eye on the European market, Matrix had bought Docpharma, a pharmaceutical trading company with a robust marketing and distribution network in western Europe for $263 million. Docpharma was a smart buy — but Matrix was still absent in the US, the world’s largest pharma market. However, Matrix’s balance sheet did not allow it to enter the US market through, say, a $50-million acquisition any longer. Especially not after Docpharma.
“We could not make an acquisition that was substantial on a global scale. But we had an open mind to be in the business. The chairman provided the answer. To stay in the game, to create more value for the shareholder, and to protect employees’ interests, Matrix would sell,” says Malik. Indeed, as the next article argues, Prasad’s deal will perhaps trigger a round of consolidation in Indian pharma.
STILL IN THE SADDLE: Rajiv Malik, CEO, Matrix Labs, will continue to head its operations in India
Mylan was, of course, a great fit. Puneet Bhatia, managing director, Newbridge India and private equity investor in Matrix since 2004, says that though Mylan is not so well known in India, the company is the gold standard in the generics business in the US. “It has a very strong balance sheet and the highest profit margins.”
Moreover, in the last four years, Mylan has been buying APIs from Matrix. The leaders of the two companies, Prasad and Robert Coury, vice-chairman and CEO, Mylan, have immense respect for each other, even though the two met for the first time only last December.
Coury’s respect for Prasad was evident from his precondi tion for the merger — that Prasad join Mylan’s board. With his experience in global markets to back him up, Prasad will take over as head of global strategies at Mylan. (In India, the rest of the management team of Matrix will take the show forward under Malik as CEO. The other significant acquisition of Matrix, Docpharma, will continue to be managed by Stijn Van Rompay, the co-founder of the company.)
For Prasad, who started his career as an employee and moved on to be an entrepreneur, life has come full circle. It is perhaps not easy for an entrepreneur who has built a company to become an employee, albeit an immensely wealthy one with a shareholding to boot.
But Prasad makes it seem easy. “I should have a job because of my competence and not because of my share in the company.”
A year ago when he was CEO of Matrix and in charge of operations, he figured to take Matrix ahead, he needed someone of Malik’s calibre. The two have known each other since 1998. “To get Malik into Matrix, I could not offer him a post lower than that of the CEO,” says Prasad.
And so, active entrepreneur-CEO Prasad made way for Malik and made himself chairman of the company. “Kicking oneself upstairs in favour of a professional is something that is rare. But Prasad is unusual,” says Newbridge’s Bhatia.
Friday, April 6, 2007
Howard Hughes
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"I am determined to elect a president of our choosing this year and one who will be deeply indebted, and who will recognize his indebtedness. Since I am willing to go beyond all limitations on this, I think we should be able to select a candidate and a party who knows the facts of political life....If we select Nixon, then he, I know for sure knows the facts of life." -- from handwritten memos by Howard Hughes, early in the 1968 presidential campaign
Best known for: aviator, movie producer, billionaire, hypochondriac.
Born: Howard Robard Hughes, Jr., December 24, 1905, in Houston.
Family: Mother: Allene (Gano) Hughes (died March 29, 1922); Father: Howard Robard Hughes, Sr., founder of Hughes Tool Company (died January 14, 1924); Uncle: father's brother Rupert, a writer for Samuel Goldwyn's movie studios; Wives: Houston socialite Ella Rice (married June 1, 1925, divorced in 1929); Actress Jean Peters (married 1957, divorced 1970); Hughes often dated Hollywood actresses in the 1930s, especially Katherine Hepburn.
Education: Hughes attended private school in Boston, where he was better at golf than classwork. He was attending Thacher School in California when his mother died. In California, Hughes spent time with his uncle, Rupert, who inspired his later interest in filmmaking. Hughes never graduated from high school. Nonetheless, his father arranged for him to sit in on classes at Cal Tech by donating money to the school. Afterward, Howard returned to Houston and enrolled at Rice Institute (now Rice University). Howard, Sr. died suddenly a few weeks after his son turned eighteen. Young Howard inherited much of the family estate and dropped out of Rice.
Profession: Family business: Uncle Rupert supervised Howard's part of the estate and interests in the Hughes Tool Company until he was twenty-one. Family quarrels led Howard to have company lawyers buy out his relatives. A Houston judge and friend of his late father's granted Howard legal adulthood on December 26, 1924, allowing him to take over the tool company.
Career: Movies: Following the summer of 1924, Howard and Ella moved to Hollywood to pursue Howard's interest in making movies. When his first attempt failed, he hired Noah Dietrich to head the movie subsidiary of his tool company, and Lewis Mileston as director. The new team won an academy award for Two Arabian Nights (1928). Their next film, Hell's Angels (1930), written and directed by Hughes and starring Jean Harlow, was the most expensive movie of its time at a cost of $3.8 million. This movie, about World War I aviators, lost $1.5 million at the box office but allowed Hughes to indulge his interest in flying. While shooting Hell's Angels, Hughes earned his pilot's license. Two later Hughes films tested the limits of public morality. Scarface (1932) was censored until Hughes sued to allow its release, and The Outlaw (1941) became controversial for its sexually explicit advertising and content, both featuring a sensational d飯lletage worn by a busty Jane Russell. Inspired by the excitement over The Outlaw, Hughes later took a break from airplane fuselage design to create the half-cup bra, modelled of course by his Hollywood discovery, Jane Russell. It was in the '30s that Hughes built the Texas Theater, the movie house in the Oak Cliff section of Dallas in which Lee Harvey Oswald was arrested in 1963. The closeness of both men to the CIA makes it all but certain that the Texas Theater would have become a clandestine meeting place for spies. Such use of movie theaters had long been a staple of espionage tradecraft, and other Hughes properties were put to similar use. Hughes owned the RKO movie studio from 1948 to 1955.
Aviation: In 1932, Hughes formed the Hughes Aircraft Company division of Hughes Tool. The company has pioneered many innovations in aerospace technology. But its origin was an attempt to finance the expensive conversion of a military plane into a racing plane. The next year, he achieved a false status by lobbying the Commerce Department to lower his pilot's license number from 4223 to 80. Charles Lindbergh's number was 69. The only real job Hughes ever had also came in 1933. He signed on as a co-pilot for American Airways. He applied under the name Charles W. Howard. The ruse was quickly discovered, however, and Hughes resigned. After entering and winning the 1934 All-America Air Meet in Miami, Hughes built and personally test-piloted the world's most advanced plane, the H-1. On September 13, 1935, he set a new speed record, taking the plane to 352 mph. Over the next two years, he set two new records with transcontinental flights. Between July 10 and 14, 1938, Hughes piloted a special Lockheed 14 with a crew of four on a flight around the world. He cut Lindbergh's New York to Paris record in half, and finished the trip in three days, nineteen hours and seventeen minutes. Houston's airport was renamed in his honor. As World War II approached, Hughes turned his full attention to building military aircraft. But his regard for secrecy and disregard for military protocol and standardized materials kept him from getting contracts. Henry J. Kaiser, the famous shipbuilder, helped Hughes get a contract to build three "flying boats" for $18 million in three months. Those terms proved impossible for Hughes. In the end, he produced only one of the planes after the war ended. It was flown only once on November 2, 1947, by Hughes himself. The public ridiculed him by calling the plane "The Spruce Goose." Another wartime contract for reconnaissance planes went similarly unfulfilled, and caused the deaths of two people when Hughes crashed during a test flight at Lake Mead. In 1947, the Senate investigated Hughes failure to meet his wartime contracts. In the 1950s and beyond, Hughes manufactured spy satellites.
Military-Industrial Complex: Throughout the 1950s, as the power of three entities grew -- the Hughes empire, organized crime, and the new Central Intelligence Agency -- it became all but impossible to distinguish between them. By the end of the decade, Hughes' chief of staff, Robert Maheu, had orchestrated the CIA's dirtiest secret -- plots to assassinate Cuban leader Fidel Castro with the help of two heads of organized crime. Vice President Richard Nixon was the White House action officer in the clandestine attempts to oust Castro. Zapata Off-Shore, the oil company owned by future CIA director and U.S. president George Bush after he split it off from Zapata Oil partner Hugh Liedtke in 1954, had a drilling rig on the Cay Sal Bank in 1958. These islands had been leased to Nixon supporter and CIA contractor Howard Hughes the previous year and were later used as a base for CIA raids on Cuba. Nixon lost the 1960 presidential election to John F. Kennedy largely because of a scandal over a never repaid $205,000 "loan" Nixon's brother received from Hughes. As attorney general, Robert Kennedy secretly investigated the Hughes-Nixon dealings.
After Bobby Kennedy's assassination in 1968, Maheu and Hughes hired long-time Kennedy advisor Larry O'Brien along with other political insiders to protect their interests in Washington. In 1953, Hughes had founded the Hughes Medical Institute in Delaware as his sole act of philanthropy. By turning over all of the stock of Hughes Aircraft Company to the institute, he made his billion-dollar-a-year weapons factory a tax-exempt charity. By 1969, that scam was about to be shut down by a Senate bill, which followed an investigation by fellow Texan Wright Patman, the powerful chairman of the House Banking Committee. But O'Brien lobbied his allies and got a loophole creating an exemption for "medical research organizations" like the Hughes Medical Institute.
President Nixon's downfall began when he ordered burglars to break into Larry O'Brien's office in 1972. At the time, O'Brien was both a Hughes employee and chairman of the Democratic National Committee, headquartered in the Watergate Hotel. The Watergate burglars happened to have been heavily involved in the covert anti-Castro operations (which Nixon oversaw as vice president). They were also deeply involved in the conspiracies which grew out of those operations; conspiracies which prevented any major political future for the Kennedy family, and led directly to Nixon's resurrection from political obscurity. The purpose of the break-in was never revealed because the Watergate scandal's investigations were sidetracked, likely on purpose, into a focus on multiple other high crimes by Nixon. Whatever the purpose of the break-in, Hughes was right in the middle of the major forces linking the conspiracies that resulted in the murders and character assassinations of the Kennedy brothers, and the Watergate scandal that toppled the Nixon administration.
During all of these political intrigues, arguments between Hughes and his employees continued to threaten military contracts and resulted in his firing his long-time associate Noah Dietrich in 1957. As a stockholder in Trans World Airways, Hughes lobbied for the airline's purchase of sixty-three jets in 1956. He sold his TWA stock in 1966 for $546 million when the company faced numerous lawsuits. That same year, Hughes moved to Las Vegas and began doing business there. Las Vegas organized crime interests were actively transferring casino ownership to frontmen with less tainted reputations.
Hughes took over Air West in 1970. (He was later indicted in the Air West takeover, but the case was dismissed.) Hughes was increasingly reclusive and decreasingly in control of his business dealings. Not even Nixon could contact him directly. Maheu's power was also declining. The CIA assassination plots had begun to leak to the press, requiring the government to distance itself from Maheu. Not only did he know too much, it was one of his associates, attorney Ed Morgan, who had leaked the story to columnist Jack Anderson. It was now Chester Davis, Raymond Holliday, and Bill Gay, the Hughes Tool Company executives who ran Hughes Nevada properties, who were contacted by the CIA when they wanted to build a CIA ship, the Glomar Explorer, to recover a sunken Soviet submarine.
In 1972, Hughes sold Hughes Tool Company's stock and renamed his company Summa Corporation, ending any remaining role in his business. His health deteriorated and his entourage of aids carted him to Panama, Canada, London and Acapulco. On June 5, 1974, a break-in occurred at Hughes' Romaine Street headquarters in Los Angeles. The theft of secret documents sent shockwaves through the U.S. intelligence community.
Death: Hughes died April 5, 1976, en route by private jet to a hospital in Houston. His drastically changed appearance and the fact that he had been seen by so few people for so long forced the Treasury Department to use fingerprints to identify his body. He left an estate estimated at $2 billion. Four hundred prospective heirs tried to inherit it but it eventually went to twenty-two cousins on both sides of his family. Texas, Nevada and California claimed inheritance-tax in disputes reviewed by the Supreme Court three times. Hughes Aircraft ended up in the hands of Hughes Medical Institute, which sold it to General Motors in 1985 for $5 billion. Four hotels and six casinos in Las Vegas and Reno remained with Summa Corporation.
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"I am determined to elect a president of our choosing this year and one who will be deeply indebted, and who will recognize his indebtedness. Since I am willing to go beyond all limitations on this, I think we should be able to select a candidate and a party who knows the facts of political life....If we select Nixon, then he, I know for sure knows the facts of life." -- from handwritten memos by Howard Hughes, early in the 1968 presidential campaign
Best known for: aviator, movie producer, billionaire, hypochondriac.
Born: Howard Robard Hughes, Jr., December 24, 1905, in Houston.
Family: Mother: Allene (Gano) Hughes (died March 29, 1922); Father: Howard Robard Hughes, Sr., founder of Hughes Tool Company (died January 14, 1924); Uncle: father's brother Rupert, a writer for Samuel Goldwyn's movie studios; Wives: Houston socialite Ella Rice (married June 1, 1925, divorced in 1929); Actress Jean Peters (married 1957, divorced 1970); Hughes often dated Hollywood actresses in the 1930s, especially Katherine Hepburn.
Education: Hughes attended private school in Boston, where he was better at golf than classwork. He was attending Thacher School in California when his mother died. In California, Hughes spent time with his uncle, Rupert, who inspired his later interest in filmmaking. Hughes never graduated from high school. Nonetheless, his father arranged for him to sit in on classes at Cal Tech by donating money to the school. Afterward, Howard returned to Houston and enrolled at Rice Institute (now Rice University). Howard, Sr. died suddenly a few weeks after his son turned eighteen. Young Howard inherited much of the family estate and dropped out of Rice.
Profession: Family business: Uncle Rupert supervised Howard's part of the estate and interests in the Hughes Tool Company until he was twenty-one. Family quarrels led Howard to have company lawyers buy out his relatives. A Houston judge and friend of his late father's granted Howard legal adulthood on December 26, 1924, allowing him to take over the tool company.
Career: Movies: Following the summer of 1924, Howard and Ella moved to Hollywood to pursue Howard's interest in making movies. When his first attempt failed, he hired Noah Dietrich to head the movie subsidiary of his tool company, and Lewis Mileston as director. The new team won an academy award for Two Arabian Nights (1928). Their next film, Hell's Angels (1930), written and directed by Hughes and starring Jean Harlow, was the most expensive movie of its time at a cost of $3.8 million. This movie, about World War I aviators, lost $1.5 million at the box office but allowed Hughes to indulge his interest in flying. While shooting Hell's Angels, Hughes earned his pilot's license. Two later Hughes films tested the limits of public morality. Scarface (1932) was censored until Hughes sued to allow its release, and The Outlaw (1941) became controversial for its sexually explicit advertising and content, both featuring a sensational d飯lletage worn by a busty Jane Russell. Inspired by the excitement over The Outlaw, Hughes later took a break from airplane fuselage design to create the half-cup bra, modelled of course by his Hollywood discovery, Jane Russell. It was in the '30s that Hughes built the Texas Theater, the movie house in the Oak Cliff section of Dallas in which Lee Harvey Oswald was arrested in 1963. The closeness of both men to the CIA makes it all but certain that the Texas Theater would have become a clandestine meeting place for spies. Such use of movie theaters had long been a staple of espionage tradecraft, and other Hughes properties were put to similar use. Hughes owned the RKO movie studio from 1948 to 1955.
Aviation: In 1932, Hughes formed the Hughes Aircraft Company division of Hughes Tool. The company has pioneered many innovations in aerospace technology. But its origin was an attempt to finance the expensive conversion of a military plane into a racing plane. The next year, he achieved a false status by lobbying the Commerce Department to lower his pilot's license number from 4223 to 80. Charles Lindbergh's number was 69. The only real job Hughes ever had also came in 1933. He signed on as a co-pilot for American Airways. He applied under the name Charles W. Howard. The ruse was quickly discovered, however, and Hughes resigned. After entering and winning the 1934 All-America Air Meet in Miami, Hughes built and personally test-piloted the world's most advanced plane, the H-1. On September 13, 1935, he set a new speed record, taking the plane to 352 mph. Over the next two years, he set two new records with transcontinental flights. Between July 10 and 14, 1938, Hughes piloted a special Lockheed 14 with a crew of four on a flight around the world. He cut Lindbergh's New York to Paris record in half, and finished the trip in three days, nineteen hours and seventeen minutes. Houston's airport was renamed in his honor. As World War II approached, Hughes turned his full attention to building military aircraft. But his regard for secrecy and disregard for military protocol and standardized materials kept him from getting contracts. Henry J. Kaiser, the famous shipbuilder, helped Hughes get a contract to build three "flying boats" for $18 million in three months. Those terms proved impossible for Hughes. In the end, he produced only one of the planes after the war ended. It was flown only once on November 2, 1947, by Hughes himself. The public ridiculed him by calling the plane "The Spruce Goose." Another wartime contract for reconnaissance planes went similarly unfulfilled, and caused the deaths of two people when Hughes crashed during a test flight at Lake Mead. In 1947, the Senate investigated Hughes failure to meet his wartime contracts. In the 1950s and beyond, Hughes manufactured spy satellites.
Military-Industrial Complex: Throughout the 1950s, as the power of three entities grew -- the Hughes empire, organized crime, and the new Central Intelligence Agency -- it became all but impossible to distinguish between them. By the end of the decade, Hughes' chief of staff, Robert Maheu, had orchestrated the CIA's dirtiest secret -- plots to assassinate Cuban leader Fidel Castro with the help of two heads of organized crime. Vice President Richard Nixon was the White House action officer in the clandestine attempts to oust Castro. Zapata Off-Shore, the oil company owned by future CIA director and U.S. president George Bush after he split it off from Zapata Oil partner Hugh Liedtke in 1954, had a drilling rig on the Cay Sal Bank in 1958. These islands had been leased to Nixon supporter and CIA contractor Howard Hughes the previous year and were later used as a base for CIA raids on Cuba. Nixon lost the 1960 presidential election to John F. Kennedy largely because of a scandal over a never repaid $205,000 "loan" Nixon's brother received from Hughes. As attorney general, Robert Kennedy secretly investigated the Hughes-Nixon dealings.
After Bobby Kennedy's assassination in 1968, Maheu and Hughes hired long-time Kennedy advisor Larry O'Brien along with other political insiders to protect their interests in Washington. In 1953, Hughes had founded the Hughes Medical Institute in Delaware as his sole act of philanthropy. By turning over all of the stock of Hughes Aircraft Company to the institute, he made his billion-dollar-a-year weapons factory a tax-exempt charity. By 1969, that scam was about to be shut down by a Senate bill, which followed an investigation by fellow Texan Wright Patman, the powerful chairman of the House Banking Committee. But O'Brien lobbied his allies and got a loophole creating an exemption for "medical research organizations" like the Hughes Medical Institute.
President Nixon's downfall began when he ordered burglars to break into Larry O'Brien's office in 1972. At the time, O'Brien was both a Hughes employee and chairman of the Democratic National Committee, headquartered in the Watergate Hotel. The Watergate burglars happened to have been heavily involved in the covert anti-Castro operations (which Nixon oversaw as vice president). They were also deeply involved in the conspiracies which grew out of those operations; conspiracies which prevented any major political future for the Kennedy family, and led directly to Nixon's resurrection from political obscurity. The purpose of the break-in was never revealed because the Watergate scandal's investigations were sidetracked, likely on purpose, into a focus on multiple other high crimes by Nixon. Whatever the purpose of the break-in, Hughes was right in the middle of the major forces linking the conspiracies that resulted in the murders and character assassinations of the Kennedy brothers, and the Watergate scandal that toppled the Nixon administration.
During all of these political intrigues, arguments between Hughes and his employees continued to threaten military contracts and resulted in his firing his long-time associate Noah Dietrich in 1957. As a stockholder in Trans World Airways, Hughes lobbied for the airline's purchase of sixty-three jets in 1956. He sold his TWA stock in 1966 for $546 million when the company faced numerous lawsuits. That same year, Hughes moved to Las Vegas and began doing business there. Las Vegas organized crime interests were actively transferring casino ownership to frontmen with less tainted reputations.
Hughes took over Air West in 1970. (He was later indicted in the Air West takeover, but the case was dismissed.) Hughes was increasingly reclusive and decreasingly in control of his business dealings. Not even Nixon could contact him directly. Maheu's power was also declining. The CIA assassination plots had begun to leak to the press, requiring the government to distance itself from Maheu. Not only did he know too much, it was one of his associates, attorney Ed Morgan, who had leaked the story to columnist Jack Anderson. It was now Chester Davis, Raymond Holliday, and Bill Gay, the Hughes Tool Company executives who ran Hughes Nevada properties, who were contacted by the CIA when they wanted to build a CIA ship, the Glomar Explorer, to recover a sunken Soviet submarine.
In 1972, Hughes sold Hughes Tool Company's stock and renamed his company Summa Corporation, ending any remaining role in his business. His health deteriorated and his entourage of aids carted him to Panama, Canada, London and Acapulco. On June 5, 1974, a break-in occurred at Hughes' Romaine Street headquarters in Los Angeles. The theft of secret documents sent shockwaves through the U.S. intelligence community.
Death: Hughes died April 5, 1976, en route by private jet to a hospital in Houston. His drastically changed appearance and the fact that he had been seen by so few people for so long forced the Treasury Department to use fingerprints to identify his body. He left an estate estimated at $2 billion. Four hundred prospective heirs tried to inherit it but it eventually went to twenty-two cousins on both sides of his family. Texas, Nevada and California claimed inheritance-tax in disputes reviewed by the Supreme Court three times. Hughes Aircraft ended up in the hands of Hughes Medical Institute, which sold it to General Motors in 1985 for $5 billion. Four hotels and six casinos in Las Vegas and Reno remained with Summa Corporation.
N Prasad
McDonald’s must be loving it. The king of burgers retained its crown for the third survey running. While McDonald’s has turned out to be a runaway winner in this category, the second spot has been much more keenly contested. Three pizza companies and a coffee chain have finished with fairly similar scores. However, their positions have churned significantly compared to the last rankings. Domino’s has bagged the second spot, displacing Pizza Hut, which has slipped to the fifth spot, and Pizza Corner has displaced Café Coffee Day for the third rank. This has not been a great year for the coffee companies as Barista has stayed flat on the fourth rung while Café Coffee Day has slipped to the sixth position.
Domino’s owes its climb up the respectability ladder to its innovations and brand building campaigns over the last couple of years. Being a mostly delivery-based pizza joint, it has converted its niche into an advantage. Its “30 minutes or free” offer got people hooked on to a game of call-and-clock that impressed customers either way — if their pizza was delivered within 30 minutes of ordering, it was a promise kept, and if not, they did not have to pay for it. The success of the campaign has big name competition stooping to rather tasteless attacks on this high-involvement, race-against-time campaign. Of course, there has been a downside to this rush — Domino’s pizza delivery boys have been found risking their bones as well as others’ in traffic to avoid paying for the free pizzas from their own pockets.
Domino’s India CEO, Ajay Kaul, sLast year, Sudhir Vaid, managing director, Concord Biotech, discovered a new facet of N. Prasad, chairman and founder of Matrix Laboratories. Prasad was Vaid’s new boss as Matrix had just acquired 51 per cent of Concord. Soon after the acquisition, Prasad visited Ahmedabad. As Vaid took Prasad around the city, Prasad started humming quietly and then launched into a few songs. “If you ever get to hear him sing, you will know that is really his talent,” says Vaid. But then, Prasad, 45, is a man of many talents.
He comes from a middle-class defence background with his education spread over Punjab, Hyderabad and New Delhi. “I was a very average student,” he reminisces. What he lacked in education, he made up with common sense and determination. And when he set his heart on something, he did it.
Over the last five years, Matrix has acquired and picked up equity in seven companies including Docpharma (Europe) and Mchem (China), and a joint venture with Aspen Labs (South Africa). In India, it started with a stake in Plant Organics and then Herren Drugs, Vera Labs, Vorin Lab, Fine Chemicals, Medicorp and Concord. Matrix ended 2006 with consolidated revenues of Rs 1,158.61 crore. To reach this far, it takes a company at least 15 years; Prasad has done it in five. Now, he wants Matrix to be among the top five Indian pharma companies.
Prasad is a good judge of people. He also identifies talent and brings out the best in them. His old-time employees rarely leave. If they do, in most instances they come back. People sometimes take advantage of him because of his empathy, feels C. Ramakrishna, CFO and head (corporate affairs), Matrix. He has been with Prasad since 2001 and is now a friend.
That is one facet, but Prasad has also never shied away from taking tough decisions. One instance was in July last year when he roped in Rajiv Malik, (CEO, Sandoz R&D) as CEO Of Matrix. Very few founders have handed over charge to a professional CEO at a young age. Getting Malik was also a coup since he was responsible for Sandoz’s global product flow, looked after eight development centres with around 1,000 scientists and had an annual budget of $250 million.
“When Malik was to join the company, Prasad moved people around to make place for him, keeping the best interests of the company in mind. It must not have been easy, since they had been with him (Prasad) for a long time. But he did it,” says Puneet Bhatia, managing director, Newbridge India, investor and board member. His only weakness is that he overlooks finer details, but that is offset by a strong team.
For a soft spoken person, Prasad has enormous strength of character. This was evident in his early entrepreneurial life. Many years ago, Prasad was with Vorin Labs as its general manager. Vorin had two promoters — an Indian businessman and a group of NRI investors. When Prasad found that the former was siphoning money out of Vorin, he allied with the NRIs and the promoter moved out. That was how he came to acquire shares in Vorin Labs. He also continued as its MD.
Under his leadership, Vorin not only turned around but also became a preferred supplier to Ranbaxy, so much so that Ranbaxy took a 38 per cent equity stake in the company.
In 2000, Prasad and another investor, N. Ravinder, bought Herren Drugs and Pharmaceuticals and merged it with Vorin. Ranbaxy increased its stake in the company to 51 per cent. Less then a year later, when it wanted to sell out, Prasad bought out Ranbaxy’s stake and in 2001 renamed it Matrix Labs.
Prasad credits a great deal to P.A. Kumaran, his mentor and general manger at Indian Molasses, which was his first workplace. Kumaran was responsible for moving Prasad — an analytical chemist at that time — to a sales job. It was a turning point for Prasad, who took on the challenge even though he was clueless about sales. “I closed my first sale after three months and distributed sweets in my offices,” says Prasad. It was while working here that Prasad decided to get an MBA from IMT Ghaziabad.
In 1989, he moved to Rhone Poulenc as head of sales in Hyderabad and then to Plant Organics — that was a leap of faith since the MNC was willing to move Prasad overseas. Kumaran advised Prasad that exposure to manufacturing was a must. It was a tough decision because joining a loss-making company meant that the first salary came three months later. “But I knew that this small company in crisis would offer a large opportunity,” recalls Prasad. Within a year the company turned around and the owner eventually sold it to NRI investors and partners who left Prasad at the helm of affairs as CEO of Vorin Labs (a subsidiary of Plant Organics).
Recalls Rajiv Malik, who was with Ranbaxy and also on the board of Vorin: “Prasad looked for opportunities at every turn. Even when he was an API (active pharmaceutical ingredient) supplier, he was setting his sights on the next step, that of supplying APIs to the regulated market.” Ranbaxy was doubtful since Matrix had no US FDA approved plant. But Prasad resurfaced within two months with Medicorp, which had a US FDA approved plant. “Move at lightning speed if there is an opportunity has been his credo,” says Malik.
“Prasad also has the ability to take people along,” says Bhatia. Even when there have been issues of pricing and acquiring new companies, he has managed to take his board along at every step. The top management teams of all the companies he has acquired have stayed back.
However, for Prasad, wealth is not what drives him. “What is important for him is that the wealth is well spread among his colleagues,” says Ramakrishna. He also believes that society has equal share in his success; so he has sold some of his personal holdings and put the money into a family trust that supports healthcare and education. He has also placed his personal shares in the Matrix Employee Welfare Association (MEWA) to support higher education of employees’ children. Prasad is secretive about his contribution, though: “It can hardly be charity if you want attention through it.”
Prasad and his wife Asha lead a simple life. His Mercedes Benz was a reluctant buy. Despite buying property for his colleagues in Banjara Hills, he continues to live in a modest house. “I want my children to enjoy life, play in the streets as I did and not forego these pleasures for a life of luxury,” he says. He attributes his success to the support of his wife, whom he calls his constant ray of optimism.
Prasad enjoys the simple things in life. Music and movies are his passion and he has invested in MAA TV, a TV channel. You see, the chairman also sings.
Domino’s owes its climb up the respectability ladder to its innovations and brand building campaigns over the last couple of years. Being a mostly delivery-based pizza joint, it has converted its niche into an advantage. Its “30 minutes or free” offer got people hooked on to a game of call-and-clock that impressed customers either way — if their pizza was delivered within 30 minutes of ordering, it was a promise kept, and if not, they did not have to pay for it. The success of the campaign has big name competition stooping to rather tasteless attacks on this high-involvement, race-against-time campaign. Of course, there has been a downside to this rush — Domino’s pizza delivery boys have been found risking their bones as well as others’ in traffic to avoid paying for the free pizzas from their own pockets.
Domino’s India CEO, Ajay Kaul, sLast year, Sudhir Vaid, managing director, Concord Biotech, discovered a new facet of N. Prasad, chairman and founder of Matrix Laboratories. Prasad was Vaid’s new boss as Matrix had just acquired 51 per cent of Concord. Soon after the acquisition, Prasad visited Ahmedabad. As Vaid took Prasad around the city, Prasad started humming quietly and then launched into a few songs. “If you ever get to hear him sing, you will know that is really his talent,” says Vaid. But then, Prasad, 45, is a man of many talents.
He comes from a middle-class defence background with his education spread over Punjab, Hyderabad and New Delhi. “I was a very average student,” he reminisces. What he lacked in education, he made up with common sense and determination. And when he set his heart on something, he did it.
Over the last five years, Matrix has acquired and picked up equity in seven companies including Docpharma (Europe) and Mchem (China), and a joint venture with Aspen Labs (South Africa). In India, it started with a stake in Plant Organics and then Herren Drugs, Vera Labs, Vorin Lab, Fine Chemicals, Medicorp and Concord. Matrix ended 2006 with consolidated revenues of Rs 1,158.61 crore. To reach this far, it takes a company at least 15 years; Prasad has done it in five. Now, he wants Matrix to be among the top five Indian pharma companies.
Prasad is a good judge of people. He also identifies talent and brings out the best in them. His old-time employees rarely leave. If they do, in most instances they come back. People sometimes take advantage of him because of his empathy, feels C. Ramakrishna, CFO and head (corporate affairs), Matrix. He has been with Prasad since 2001 and is now a friend.
That is one facet, but Prasad has also never shied away from taking tough decisions. One instance was in July last year when he roped in Rajiv Malik, (CEO, Sandoz R&D) as CEO Of Matrix. Very few founders have handed over charge to a professional CEO at a young age. Getting Malik was also a coup since he was responsible for Sandoz’s global product flow, looked after eight development centres with around 1,000 scientists and had an annual budget of $250 million.
“When Malik was to join the company, Prasad moved people around to make place for him, keeping the best interests of the company in mind. It must not have been easy, since they had been with him (Prasad) for a long time. But he did it,” says Puneet Bhatia, managing director, Newbridge India, investor and board member. His only weakness is that he overlooks finer details, but that is offset by a strong team.
For a soft spoken person, Prasad has enormous strength of character. This was evident in his early entrepreneurial life. Many years ago, Prasad was with Vorin Labs as its general manager. Vorin had two promoters — an Indian businessman and a group of NRI investors. When Prasad found that the former was siphoning money out of Vorin, he allied with the NRIs and the promoter moved out. That was how he came to acquire shares in Vorin Labs. He also continued as its MD.
Under his leadership, Vorin not only turned around but also became a preferred supplier to Ranbaxy, so much so that Ranbaxy took a 38 per cent equity stake in the company.
In 2000, Prasad and another investor, N. Ravinder, bought Herren Drugs and Pharmaceuticals and merged it with Vorin. Ranbaxy increased its stake in the company to 51 per cent. Less then a year later, when it wanted to sell out, Prasad bought out Ranbaxy’s stake and in 2001 renamed it Matrix Labs.
Prasad credits a great deal to P.A. Kumaran, his mentor and general manger at Indian Molasses, which was his first workplace. Kumaran was responsible for moving Prasad — an analytical chemist at that time — to a sales job. It was a turning point for Prasad, who took on the challenge even though he was clueless about sales. “I closed my first sale after three months and distributed sweets in my offices,” says Prasad. It was while working here that Prasad decided to get an MBA from IMT Ghaziabad.
In 1989, he moved to Rhone Poulenc as head of sales in Hyderabad and then to Plant Organics — that was a leap of faith since the MNC was willing to move Prasad overseas. Kumaran advised Prasad that exposure to manufacturing was a must. It was a tough decision because joining a loss-making company meant that the first salary came three months later. “But I knew that this small company in crisis would offer a large opportunity,” recalls Prasad. Within a year the company turned around and the owner eventually sold it to NRI investors and partners who left Prasad at the helm of affairs as CEO of Vorin Labs (a subsidiary of Plant Organics).
Recalls Rajiv Malik, who was with Ranbaxy and also on the board of Vorin: “Prasad looked for opportunities at every turn. Even when he was an API (active pharmaceutical ingredient) supplier, he was setting his sights on the next step, that of supplying APIs to the regulated market.” Ranbaxy was doubtful since Matrix had no US FDA approved plant. But Prasad resurfaced within two months with Medicorp, which had a US FDA approved plant. “Move at lightning speed if there is an opportunity has been his credo,” says Malik.
“Prasad also has the ability to take people along,” says Bhatia. Even when there have been issues of pricing and acquiring new companies, he has managed to take his board along at every step. The top management teams of all the companies he has acquired have stayed back.
However, for Prasad, wealth is not what drives him. “What is important for him is that the wealth is well spread among his colleagues,” says Ramakrishna. He also believes that society has equal share in his success; so he has sold some of his personal holdings and put the money into a family trust that supports healthcare and education. He has also placed his personal shares in the Matrix Employee Welfare Association (MEWA) to support higher education of employees’ children. Prasad is secretive about his contribution, though: “It can hardly be charity if you want attention through it.”
Prasad and his wife Asha lead a simple life. His Mercedes Benz was a reluctant buy. Despite buying property for his colleagues in Banjara Hills, he continues to live in a modest house. “I want my children to enjoy life, play in the streets as I did and not forego these pleasures for a life of luxury,” he says. He attributes his success to the support of his wife, whom he calls his constant ray of optimism.
Prasad enjoys the simple things in life. Music and movies are his passion and he has invested in MAA TV, a TV channel. You see, the chairman also sings.
Thursday, April 5, 2007
Regional Films
FILM
The Boom In Regional Films
India's economic prosperity is scripting an unlikely story: The market for regional films has come roaring back, with Bhojpuri to Tamil to Punjabi to Telugu movies raking in record moolah at the box office.
By T.V. Mahalingam
Reel rush: Filmgoers at Prasads IMax, Hyderabad. 245 films were made in Telugu last year
In January last year, something queer happened in Mumbai. The Amitabh Bachchan-starrer Family was released simultaneously with the über-cool, ultra dark Sanjay Dutt thriller Zinda. Both movies had tepid openings and flopped subsequently. But that's hardly strange. Flops, especially costly ones, are more the norm than the exception in Bollywood. What was bizarre was the fact that the competition for Big-B and Deadly-D came from unlikely quarters-Manoj Tiwari, the Jerry Lewis of Bhojpuri cinema, who sang, danced and, of course, emoted his way to box office glory. The movie, Dehati Babu, went on to become the biggest Bhojpuri hit of 2006.
The success of Dehati Babu is no flash in the pan. The once down-in-the-dumps industry has been on a roll for the last three years. Today, Bhojwood has its own Oscars, cheekily christened, BFA-the Bhojpuri Film Awards. Star rates have more than tripled over the last year, with Manoj Tiwari charging as much as Rs 50 lakh per film. "The number of Bhojpuri movies being produced almost doubled from 39 in 2005 to 76 last year. That makes it the fastest growing film industry in India," says Supran Sen, Secretary, Film Federation of India.
THE TELUGU FILM INDUSTRY
Films produced in 2006: 245
Number of hits (2006): 10
Number of distribution territories: 3
Top grosser last year (2006): Pokkiri with close to Rs 40 crore (the highest ever in the industry's 75-year history)
Other major hits: Stalin (Rs 33 crore), and Bommarillu (Rs 20 crore)
Major movie-going towns: Nellore, Tenali, Miryalguda and Nandiyal
Number of multiplexes in state capital: Two
Average size of big budget movie: Rs 12-15 crore
Average size of medium budget movie: Rs 5-8 crore
Average time taken for movie making: 2.5 months
Top stars and their fee per film: Chiranjeevi, Rs 3.5 crore; Balakrishna, Rs 2 crore; Nagarjuna, Rs 2 crore; Venkatesh, Rs 1 crore to Rs 1.5 crore; Ravi Teja, Rs 1 crore-plus
Reel rush: Filmgoers at Prasads IMax, Hyderabad. 245 films were made in Telugu last year; Telugu actor Chiranjeevi (bottom)
The Bhojpuri industry is not the only one that's tasting success. Here's a quick quiz. In which language were the most films produced in India in 2006? No, it's not Hindi. The answer-Telugu. "Of the 1,091 movies produced in India last year, 245 were made in Telugu, 223 in Hindi and 162 in Tamil," reveals Sen. Basically, only one in every five movies made in India is churned out by Bollywood. And it's just not the volume of regional movies being made that's astonishing. The Telugu industry registered its biggest hit ever with Pokkiri, which raked in close to Rs 40 crore in box office collections. In fact, industry association FICCI had valued the Indian film industry at Rs 6,800 crore in 2005. The industry is projected to grow at CAGR of 18 per cent to Rs 15,300 crore by 2010. "It would be safe to assume that the size of the regional film industry today would be about 55-60 per cent of the total Indian film industry," says a leading film analyst. That means regional film industry revenues of Rs 4,400 crore in 2006.
The Story so Far
Packed house: With box office collections close to Rs 40 crore, Pokkiri was a Telugu blockbuster that was remade in Tamil as well (above)
Evidently, regional Indian cinema has achieved in the past three years what every corporate in India also has on its wish list-attract funds, hire and retain fresh talent and go global. But things weren't always this good. For Bhojpuri cinema, for instance, the 90's were a horrific period. Less than 20 movies were being made a year, and most of them flopped. 2004 was a watershed year with superhit movies like Panditji Bataai Na Biyah Kab Hoyee and Sasura Bada Paisewala. The success of these films opened up a market, which led to a spate of first-time producers thronging to make Bhojpuri movies. Like Sudhakar Pandey, who has produced hit Bhojpuri movies such as Sasura Bada Paisewala, and Daroga Babu I Love You. "I had a shaukh (hobby) for music. And I used to produce Bhojpuri music albums with popular singers like Manoj Tiwari. These albums used to cost Rs 10-15 lakh to make. And then, I realised that it was possible to make a Bhojpuri film for Rs 30-35 lakh. That's how I got into movies," says Pandey, who used to be in the 'clearing and forwarding business' before making a plunge into movie production in 2002. According to industry watchers, in 2006 alone, Rs 90 crore worth of Bhojpuri movies were produced-up from about Rs 55 crore in 2005. In fact, liquor baron Vijay Mallya is said to be bankrolling a Bhojpuri movie, even as Balaji Telefilms is remaking Hindi blockbuster Sholay in Bhojpuri with yesteryear matinee idol Jeetendra playing Thakur.
THE TAMIL FILM INDUSTRY
Films produced in 2006: 162
Number of hits (2006): 25, five were mega hits
Top grosser last year: Varalaaru, Rs 55 crore
Other major hits: Vettaiyadu Valaiyadu, Rs 50 crore; Tiruttu Payale, Rs 40 crore; Imsai Arasan 23am Pulikesi, Rs 15 crore
Major movie-going towns: Madurai, Coimbatore, Salem, Tirunelveli and Tiruchirappalli
Number of multiplexes in state capital: 18 screens that can be termed as multiplex; number likely to go up to 80 by 2010
Average size of big budget movie: Rs 22 crore
Average size of medium budget movie: Rs 7 crore
Top stars and their fee per film: Rs 5 crore or 30 per cent of movie budget. Super stars Kamal Hassan and Rajinikanth charge anything upwards of Rs 9 crore
Starting young: Kishen made his directorial debut at 10
The story is similar in other regional industries, too. Ask 70-year-old D. Ramanaidu, the man who holds a Guinness Book record for most movies made under one banner, on what's driving people to make more Telugu movies, and he'll tell you as it is. "There are no entry barriers here. If you have the money, you can get to promote a film. That's why we are now seeing NRIs, real estate brokers getting into this. Nearly 70 per cent of new crop of film promoters today are such people," says Ramanaidu, who points out that only 10 per cent of the movies go on to become hits.
Other film industry watchers in Hyderabad support this view. "Every month, at least a couple of people with no film background and as diverse as being into brick and sand business come to me for a signature to join the producers council," says D. Suresh Babu, President, Suresh Productions, and elder son of Ramanaidu and elder brother of well known Tollywood star Venkatesh.
The Bengali film industry, renowned for its brand of arty and sedate cinema, is also witnessing a turnaround. "The industry, seven-eight years ago, was plagued by the maladies of low budgets, poor production values and zilch marketing effort. That's passé now," says Prabhat Roy, one of the best-known film directors. The turnaround started in 2002 and since then, budgets have increased and production standards have improved. The Bengali film industry now churns out 50 movies a year with the market estimated to be worth around Rs 150 crore.
As a result, big Bollywood banners are foraying into the industry and "Ideas", a local film production company floated by Bengali superstar Prosenjit, is working on producing Bengali films. "If you make a good vernacular film, production costs are much lower and you tend to make more profits,'' says Shrikant Mohta, Director, Shri Venkatesh Films, a leading production house. As a result, Bengali actresses such as Rituparna Sengupta, Roopa Ganguly and Indrani Halder have floated production houses.
The boom in regional movies has also resulted in more and more films being shot in studios down south. "In the last one year, there has been a 50 per cent increase in the number of movies being shot here," says G. Sudhakar, General Manager (Film Marketing), Ramoji Film City. However, Mumbai continues to remain the major hub for film production, thanks to the spurt in Bhojpuri, Marathi and Punjabi movies. According to the Film Federation of India, Mumbai was the biggest centre for film production, accounting for 403 of the 1,091 films produced. Hyderabad accounted for 220 films followed by Chennai at 205 films.
New Stars, New Rules
Bhojpuri movie star: Ravi Kishen
Tamil New Year's day (April 14) will witness the clash of celluloid titans- Rajinikanth and Kamal Hassan-with the release of their mega-budget movies, Sivaji and Dasavatharam. Both movies have been made at budgets exceeding Rs 30 crore. Even though both movies are likely to open to packed houses, things have changed substantially since the 90's when the duo ruled the box office. A new breed of actors including Vikram, Surya, Ajith and Vijay has emerged as dependable box office stars.
That has resulted in two things. One, the budgets and returns of movies have got bigger. For example, Kamal Hassan's previous movie, Vettaiyadu Vilaiyadu (2006), was made at a cost of Rs 24 crore and grossed Rs 50 crore. Two, a lot more medium-sized and small-budget 'experimental' movies are being produced and becoming successful. Tamil industry watchers believe that in the first half of 2006, 35 per cent of the movies that came out were made within the budget of Rs 1.5 crore to Rs 3 crore. Similarly in the Telugu industry, almost half of the movies produced are mid-budget ventures (Rs 3-5 crore). The boom in budget movies can be partly attributed to the burgeoning costs of the stars of the South Indian film industry. Industry insiders say that Tamil 'superstar' Rajinikanth charges upwards of Rs 9 crore, while Telugu 'megastar' Chiranjeevi demands anything above Rs 3.5 crore.
THE KANNADA FILM INDUSTRY
Films produced in 2006: 67
Number of hits (2006): 12
Number of distribution territories: Seven
Top grosser last year (2006): My Autograph, Rs 6 crore
Other major hits: Jothe Jotheyali, Huballi and Sevanthi Sevanthi
Major movie-going towns: Hubli, Belguam, Dharwad, Mysore, Bellary and Mandya
Number of multiplexes in state capital: Five; total theatres in major cities, 1,200
Average size of big budget movie: Rs 3.5 crore
Average size of medium budget movie: Rs 75 lakh
Average time taken for movie making: 7 months
Top stars and their fee per film: Shivaraj Kumar, Puneet, Ravichandran, Sudeep, Upendra. All charge upwards of Rs 30 lakh
Such steep prices have forced producers and directors to look beyond predictable star casts and run-of-the-mill plots. Take the case of the Kannada industry, popularly referred to as Sandalwood. While the industry was driven for decades by pairing popular (and ageing) heroes such as Rajkumar, Vishnuvardhan and (former mp) Ambareesh with a crop of lesser paid (and often much younger) actresses, producers and directors seem to have taken a reality check recently. "There was a wave of poorly-made remakes for many years, but that has changed recently with movies such as c/o Footpath, Nenapirali, Mungarina Malle and Jothe Jotheyali all providing some fresh ideas and that too from first-time producers," says H.R. Srikanth, who produced his 11-old-year-son Kishen's directorial debut c/o Footpath. Moviemakers such as Srikanth also say the industry is getting more professional, with over-the-counter payments, bound scripts and new ideas all slowly, but surely, becoming the norm.
Not Just Box Office
Ready to roll: Director Prabhat Roy (bespectacled) says low budget Bengali films are a thing of yore
Regional producers are also beginning to focus on non-theatrical revenues like music rights, VCD rights sales and international rights sales. Even laggards like the Punjabi film industry have learnt to tap non-theatrical revenues. Manmohan Singh, a cinematographer-turned-director, has made blockbuster movies such as Jee Aayan Nu, Asa Nu Maan Watna Da and Yaaran Naal Baharan. His last movie, Dil Apna Punjabi (2006), was the first movie in the state to cross the magical Rs 10-crore mark in revenues.
This tips-produced movie had a 12-week run at the box office and did business worth Rs 4 crore in the country. Singh also released the movie in Australia, Norway, New Zealand, France, Spain, Italy and Germany, apart from usual markets like the UK, the us and Canada. "Even DVD, VCD distribution is a huge revenue-earner. For Dil Apna Punjabi, we did something between Rs 1.25-Rs 1.5 crore from both domestic and overseas market," says Singh.
THE BHOJPURI FILM INDUSTRY
Films produced in 2006: 77
Number of hits (2006): Five
Number of distribution territories: Bihar, UP, Mumbai, and parts of Punjab and West Bengal
Top grosser last year (2006): Dehati Babu, Rs 1.45 crore
Average size of big budget movie: Rs 55 lakh (recently movies have been made for Rs 1-1.5 crore)
Average size of medium budget movie: Rs 35 lakh
Average time taken for movie making: 2-4 months
Top stars and their fee per film: Manoj Tiwari, Rs 30-45 lakh; Ravi Kishen, Rs 15-25 lakh; Nagma, Rs 8-12 lakh; Rambha, Rs 5-10 lakh
THE BENGALI FILM INDUSTRY
Films produced in 2006: 35
Number of hits in 2006: Four
Number of distribution territories: Six major territories, plus 1 overseas
Top grosser last year (2006): MLA Fata Kesto, Rs 80 lakh-Rs 1 crore
Major movie-going towns: Haldia, Behrampur, Siliguri, Burdwan and Malda
Number of multiplexes in state capital: Four
Average size of big budget movie: Rs 1.5-1.6 crore
Average size of medium budget movie: Rs 70-80 lakh
Average time taken for movie making: Six months
Top stars and their fee per film: Mithun Chakraborty, Rs 15 lakh-Rs 50 lakh; Prosenjit, Rs 10 lakh-Rs 35 lakh; Jeet, Rs 10-30 lakh
THE PUNJABI FILM INDUSTRY
Films produced in 2006: 12
Number of hits (2006): Four
Number of distribution territories: Punjab, Haryana, parts of Delhi and Himachal Pradesh
Top grosser last year (2006): Dil Apna Punjabi, Rs 10-12 crore
Major movie-going towns: Ludhiana, Chandigarh Jalandhar, Amritsar & Patiala
Number of multiplexes in state capital: One
Average size of big budget movie: Rs 3-6 crore
Average size of medium budget movie: Rs 1.5 crore
Average time taken for movie making: 35-50 days
Top stars and their fee per film: Harbhajan Maan, Rs 60 lakh; Gurdas Maan, Rs 55 lakh; Babbu Maan, Rs 30 lakh; Neeru Bajwa, Rs 20 lakh.
Audio, DVD, VCD and theatrical rights for Rajinikanth's yet to be released Sivaji are being negotiated by Chennai-based AVM studios for a release in Europe, Singapore, Sri Lanka, and West Asia. The movie is also slated to hit theaters in the US, Malaysia, Australia, New Zealand, South Africa, and Mauritius. Bhojpuri movie producers too have started seriously selling VCD and music rights. "Music rights are sold at Rs 7-15 lakh per movie, while hit VCD rights can sell between Rs 15 lakh and Rs 22 lakh. There is a huge audience for Bhojpuri movies in countries like Fiji, Nepal, West Indies and Indonesia," says Bhojpuri director Rajkumar R. Pandey.
With audiences like these, it won't be long before a Ravi Kishen or a Balakrishna becomes the face of Indian cinema across the world. Cooking roast chicken on Big Brother (think Shilpa Shetty) may not be the only way.
The Boom In Regional Films
India's economic prosperity is scripting an unlikely story: The market for regional films has come roaring back, with Bhojpuri to Tamil to Punjabi to Telugu movies raking in record moolah at the box office.
By T.V. Mahalingam
Reel rush: Filmgoers at Prasads IMax, Hyderabad. 245 films were made in Telugu last year
In January last year, something queer happened in Mumbai. The Amitabh Bachchan-starrer Family was released simultaneously with the über-cool, ultra dark Sanjay Dutt thriller Zinda. Both movies had tepid openings and flopped subsequently. But that's hardly strange. Flops, especially costly ones, are more the norm than the exception in Bollywood. What was bizarre was the fact that the competition for Big-B and Deadly-D came from unlikely quarters-Manoj Tiwari, the Jerry Lewis of Bhojpuri cinema, who sang, danced and, of course, emoted his way to box office glory. The movie, Dehati Babu, went on to become the biggest Bhojpuri hit of 2006.
The success of Dehati Babu is no flash in the pan. The once down-in-the-dumps industry has been on a roll for the last three years. Today, Bhojwood has its own Oscars, cheekily christened, BFA-the Bhojpuri Film Awards. Star rates have more than tripled over the last year, with Manoj Tiwari charging as much as Rs 50 lakh per film. "The number of Bhojpuri movies being produced almost doubled from 39 in 2005 to 76 last year. That makes it the fastest growing film industry in India," says Supran Sen, Secretary, Film Federation of India.
THE TELUGU FILM INDUSTRY
Films produced in 2006: 245
Number of hits (2006): 10
Number of distribution territories: 3
Top grosser last year (2006): Pokkiri with close to Rs 40 crore (the highest ever in the industry's 75-year history)
Other major hits: Stalin (Rs 33 crore), and Bommarillu (Rs 20 crore)
Major movie-going towns: Nellore, Tenali, Miryalguda and Nandiyal
Number of multiplexes in state capital: Two
Average size of big budget movie: Rs 12-15 crore
Average size of medium budget movie: Rs 5-8 crore
Average time taken for movie making: 2.5 months
Top stars and their fee per film: Chiranjeevi, Rs 3.5 crore; Balakrishna, Rs 2 crore; Nagarjuna, Rs 2 crore; Venkatesh, Rs 1 crore to Rs 1.5 crore; Ravi Teja, Rs 1 crore-plus
Reel rush: Filmgoers at Prasads IMax, Hyderabad. 245 films were made in Telugu last year; Telugu actor Chiranjeevi (bottom)
The Bhojpuri industry is not the only one that's tasting success. Here's a quick quiz. In which language were the most films produced in India in 2006? No, it's not Hindi. The answer-Telugu. "Of the 1,091 movies produced in India last year, 245 were made in Telugu, 223 in Hindi and 162 in Tamil," reveals Sen. Basically, only one in every five movies made in India is churned out by Bollywood. And it's just not the volume of regional movies being made that's astonishing. The Telugu industry registered its biggest hit ever with Pokkiri, which raked in close to Rs 40 crore in box office collections. In fact, industry association FICCI had valued the Indian film industry at Rs 6,800 crore in 2005. The industry is projected to grow at CAGR of 18 per cent to Rs 15,300 crore by 2010. "It would be safe to assume that the size of the regional film industry today would be about 55-60 per cent of the total Indian film industry," says a leading film analyst. That means regional film industry revenues of Rs 4,400 crore in 2006.
The Story so Far
Packed house: With box office collections close to Rs 40 crore, Pokkiri was a Telugu blockbuster that was remade in Tamil as well (above)
Evidently, regional Indian cinema has achieved in the past three years what every corporate in India also has on its wish list-attract funds, hire and retain fresh talent and go global. But things weren't always this good. For Bhojpuri cinema, for instance, the 90's were a horrific period. Less than 20 movies were being made a year, and most of them flopped. 2004 was a watershed year with superhit movies like Panditji Bataai Na Biyah Kab Hoyee and Sasura Bada Paisewala. The success of these films opened up a market, which led to a spate of first-time producers thronging to make Bhojpuri movies. Like Sudhakar Pandey, who has produced hit Bhojpuri movies such as Sasura Bada Paisewala, and Daroga Babu I Love You. "I had a shaukh (hobby) for music. And I used to produce Bhojpuri music albums with popular singers like Manoj Tiwari. These albums used to cost Rs 10-15 lakh to make. And then, I realised that it was possible to make a Bhojpuri film for Rs 30-35 lakh. That's how I got into movies," says Pandey, who used to be in the 'clearing and forwarding business' before making a plunge into movie production in 2002. According to industry watchers, in 2006 alone, Rs 90 crore worth of Bhojpuri movies were produced-up from about Rs 55 crore in 2005. In fact, liquor baron Vijay Mallya is said to be bankrolling a Bhojpuri movie, even as Balaji Telefilms is remaking Hindi blockbuster Sholay in Bhojpuri with yesteryear matinee idol Jeetendra playing Thakur.
THE TAMIL FILM INDUSTRY
Films produced in 2006: 162
Number of hits (2006): 25, five were mega hits
Top grosser last year: Varalaaru, Rs 55 crore
Other major hits: Vettaiyadu Valaiyadu, Rs 50 crore; Tiruttu Payale, Rs 40 crore; Imsai Arasan 23am Pulikesi, Rs 15 crore
Major movie-going towns: Madurai, Coimbatore, Salem, Tirunelveli and Tiruchirappalli
Number of multiplexes in state capital: 18 screens that can be termed as multiplex; number likely to go up to 80 by 2010
Average size of big budget movie: Rs 22 crore
Average size of medium budget movie: Rs 7 crore
Top stars and their fee per film: Rs 5 crore or 30 per cent of movie budget. Super stars Kamal Hassan and Rajinikanth charge anything upwards of Rs 9 crore
Starting young: Kishen made his directorial debut at 10
The story is similar in other regional industries, too. Ask 70-year-old D. Ramanaidu, the man who holds a Guinness Book record for most movies made under one banner, on what's driving people to make more Telugu movies, and he'll tell you as it is. "There are no entry barriers here. If you have the money, you can get to promote a film. That's why we are now seeing NRIs, real estate brokers getting into this. Nearly 70 per cent of new crop of film promoters today are such people," says Ramanaidu, who points out that only 10 per cent of the movies go on to become hits.
Other film industry watchers in Hyderabad support this view. "Every month, at least a couple of people with no film background and as diverse as being into brick and sand business come to me for a signature to join the producers council," says D. Suresh Babu, President, Suresh Productions, and elder son of Ramanaidu and elder brother of well known Tollywood star Venkatesh.
The Bengali film industry, renowned for its brand of arty and sedate cinema, is also witnessing a turnaround. "The industry, seven-eight years ago, was plagued by the maladies of low budgets, poor production values and zilch marketing effort. That's passé now," says Prabhat Roy, one of the best-known film directors. The turnaround started in 2002 and since then, budgets have increased and production standards have improved. The Bengali film industry now churns out 50 movies a year with the market estimated to be worth around Rs 150 crore.
As a result, big Bollywood banners are foraying into the industry and "Ideas", a local film production company floated by Bengali superstar Prosenjit, is working on producing Bengali films. "If you make a good vernacular film, production costs are much lower and you tend to make more profits,'' says Shrikant Mohta, Director, Shri Venkatesh Films, a leading production house. As a result, Bengali actresses such as Rituparna Sengupta, Roopa Ganguly and Indrani Halder have floated production houses.
The boom in regional movies has also resulted in more and more films being shot in studios down south. "In the last one year, there has been a 50 per cent increase in the number of movies being shot here," says G. Sudhakar, General Manager (Film Marketing), Ramoji Film City. However, Mumbai continues to remain the major hub for film production, thanks to the spurt in Bhojpuri, Marathi and Punjabi movies. According to the Film Federation of India, Mumbai was the biggest centre for film production, accounting for 403 of the 1,091 films produced. Hyderabad accounted for 220 films followed by Chennai at 205 films.
New Stars, New Rules
Bhojpuri movie star: Ravi Kishen
Tamil New Year's day (April 14) will witness the clash of celluloid titans- Rajinikanth and Kamal Hassan-with the release of their mega-budget movies, Sivaji and Dasavatharam. Both movies have been made at budgets exceeding Rs 30 crore. Even though both movies are likely to open to packed houses, things have changed substantially since the 90's when the duo ruled the box office. A new breed of actors including Vikram, Surya, Ajith and Vijay has emerged as dependable box office stars.
That has resulted in two things. One, the budgets and returns of movies have got bigger. For example, Kamal Hassan's previous movie, Vettaiyadu Vilaiyadu (2006), was made at a cost of Rs 24 crore and grossed Rs 50 crore. Two, a lot more medium-sized and small-budget 'experimental' movies are being produced and becoming successful. Tamil industry watchers believe that in the first half of 2006, 35 per cent of the movies that came out were made within the budget of Rs 1.5 crore to Rs 3 crore. Similarly in the Telugu industry, almost half of the movies produced are mid-budget ventures (Rs 3-5 crore). The boom in budget movies can be partly attributed to the burgeoning costs of the stars of the South Indian film industry. Industry insiders say that Tamil 'superstar' Rajinikanth charges upwards of Rs 9 crore, while Telugu 'megastar' Chiranjeevi demands anything above Rs 3.5 crore.
THE KANNADA FILM INDUSTRY
Films produced in 2006: 67
Number of hits (2006): 12
Number of distribution territories: Seven
Top grosser last year (2006): My Autograph, Rs 6 crore
Other major hits: Jothe Jotheyali, Huballi and Sevanthi Sevanthi
Major movie-going towns: Hubli, Belguam, Dharwad, Mysore, Bellary and Mandya
Number of multiplexes in state capital: Five; total theatres in major cities, 1,200
Average size of big budget movie: Rs 3.5 crore
Average size of medium budget movie: Rs 75 lakh
Average time taken for movie making: 7 months
Top stars and their fee per film: Shivaraj Kumar, Puneet, Ravichandran, Sudeep, Upendra. All charge upwards of Rs 30 lakh
Such steep prices have forced producers and directors to look beyond predictable star casts and run-of-the-mill plots. Take the case of the Kannada industry, popularly referred to as Sandalwood. While the industry was driven for decades by pairing popular (and ageing) heroes such as Rajkumar, Vishnuvardhan and (former mp) Ambareesh with a crop of lesser paid (and often much younger) actresses, producers and directors seem to have taken a reality check recently. "There was a wave of poorly-made remakes for many years, but that has changed recently with movies such as c/o Footpath, Nenapirali, Mungarina Malle and Jothe Jotheyali all providing some fresh ideas and that too from first-time producers," says H.R. Srikanth, who produced his 11-old-year-son Kishen's directorial debut c/o Footpath. Moviemakers such as Srikanth also say the industry is getting more professional, with over-the-counter payments, bound scripts and new ideas all slowly, but surely, becoming the norm.
Not Just Box Office
Ready to roll: Director Prabhat Roy (bespectacled) says low budget Bengali films are a thing of yore
Regional producers are also beginning to focus on non-theatrical revenues like music rights, VCD rights sales and international rights sales. Even laggards like the Punjabi film industry have learnt to tap non-theatrical revenues. Manmohan Singh, a cinematographer-turned-director, has made blockbuster movies such as Jee Aayan Nu, Asa Nu Maan Watna Da and Yaaran Naal Baharan. His last movie, Dil Apna Punjabi (2006), was the first movie in the state to cross the magical Rs 10-crore mark in revenues.
This tips-produced movie had a 12-week run at the box office and did business worth Rs 4 crore in the country. Singh also released the movie in Australia, Norway, New Zealand, France, Spain, Italy and Germany, apart from usual markets like the UK, the us and Canada. "Even DVD, VCD distribution is a huge revenue-earner. For Dil Apna Punjabi, we did something between Rs 1.25-Rs 1.5 crore from both domestic and overseas market," says Singh.
THE BHOJPURI FILM INDUSTRY
Films produced in 2006: 77
Number of hits (2006): Five
Number of distribution territories: Bihar, UP, Mumbai, and parts of Punjab and West Bengal
Top grosser last year (2006): Dehati Babu, Rs 1.45 crore
Average size of big budget movie: Rs 55 lakh (recently movies have been made for Rs 1-1.5 crore)
Average size of medium budget movie: Rs 35 lakh
Average time taken for movie making: 2-4 months
Top stars and their fee per film: Manoj Tiwari, Rs 30-45 lakh; Ravi Kishen, Rs 15-25 lakh; Nagma, Rs 8-12 lakh; Rambha, Rs 5-10 lakh
THE BENGALI FILM INDUSTRY
Films produced in 2006: 35
Number of hits in 2006: Four
Number of distribution territories: Six major territories, plus 1 overseas
Top grosser last year (2006): MLA Fata Kesto, Rs 80 lakh-Rs 1 crore
Major movie-going towns: Haldia, Behrampur, Siliguri, Burdwan and Malda
Number of multiplexes in state capital: Four
Average size of big budget movie: Rs 1.5-1.6 crore
Average size of medium budget movie: Rs 70-80 lakh
Average time taken for movie making: Six months
Top stars and their fee per film: Mithun Chakraborty, Rs 15 lakh-Rs 50 lakh; Prosenjit, Rs 10 lakh-Rs 35 lakh; Jeet, Rs 10-30 lakh
THE PUNJABI FILM INDUSTRY
Films produced in 2006: 12
Number of hits (2006): Four
Number of distribution territories: Punjab, Haryana, parts of Delhi and Himachal Pradesh
Top grosser last year (2006): Dil Apna Punjabi, Rs 10-12 crore
Major movie-going towns: Ludhiana, Chandigarh Jalandhar, Amritsar & Patiala
Number of multiplexes in state capital: One
Average size of big budget movie: Rs 3-6 crore
Average size of medium budget movie: Rs 1.5 crore
Average time taken for movie making: 35-50 days
Top stars and their fee per film: Harbhajan Maan, Rs 60 lakh; Gurdas Maan, Rs 55 lakh; Babbu Maan, Rs 30 lakh; Neeru Bajwa, Rs 20 lakh.
Audio, DVD, VCD and theatrical rights for Rajinikanth's yet to be released Sivaji are being negotiated by Chennai-based AVM studios for a release in Europe, Singapore, Sri Lanka, and West Asia. The movie is also slated to hit theaters in the US, Malaysia, Australia, New Zealand, South Africa, and Mauritius. Bhojpuri movie producers too have started seriously selling VCD and music rights. "Music rights are sold at Rs 7-15 lakh per movie, while hit VCD rights can sell between Rs 15 lakh and Rs 22 lakh. There is a huge audience for Bhojpuri movies in countries like Fiji, Nepal, West Indies and Indonesia," says Bhojpuri director Rajkumar R. Pandey.
With audiences like these, it won't be long before a Ravi Kishen or a Balakrishna becomes the face of Indian cinema across the world. Cooking roast chicken on Big Brother (think Shilpa Shetty) may not be the only way.
Wednesday, April 4, 2007
Stocks
TELEDATA--- High Risk/High Gain Stock...
People are only talking about the stocks which didnot performed after demerger, but didnot talked about stocks which has done well before and after demerger. Best example is reliance which has moved up more then 200 % after demerger. Talk about indiabulls which has moved more then 400% before demerger and still after demerger it is holding nearly at the same value. Also shyam telecom and also silverline which is another one going to demerge and had already moved more than 200% from its years low, but yes silverlines results also play a part in that.
another thing is that if you see the earnings and profit expectations of the demerged companies than that is great.
If company delievers even half of what they had declared still the valuations will be go like this
Teledata Informatics - Predicted 11.7 EPS - Information Technology company - 15 should be the PE but even if marget gives 5 then rate is 70 Rs.
Teledata Marine - Predicted EPS 30 - Shipping and Education - 5 Should be the PE but even at 3 PE the rate is at 90.
Teledata Technology - Predicted EPS 20 - Another IT company - Redington another E.g of similiar profile - 12 should be the PE but even at 5 PE the rate is 100.
So if you invest 55000 today for 1000 shares then the value should be minimum 65000 + 45000 + 50000 = 160000 which is nearly 200 % more than current rate.
Just imagine these are half values so full valuuation can give what rate in a year time.
Also if you see the companies last 2-3 quarters performance then it is sure that they will definately give 50 % of what they are declaring.
AIR DECCAN (Deccan Airways)---Now tradin around 94...for long Term Invsetment...Breakeven in this year
DECCAN GOLD....company is in looses but good to invest a little bit for long term...if they find gold then this stock is going to be gold..now trading arround 13rs...Now the price for yellow metal is at high, more profits due to high price...
People are only talking about the stocks which didnot performed after demerger, but didnot talked about stocks which has done well before and after demerger. Best example is reliance which has moved up more then 200 % after demerger. Talk about indiabulls which has moved more then 400% before demerger and still after demerger it is holding nearly at the same value. Also shyam telecom and also silverline which is another one going to demerge and had already moved more than 200% from its years low, but yes silverlines results also play a part in that.
another thing is that if you see the earnings and profit expectations of the demerged companies than that is great.
If company delievers even half of what they had declared still the valuations will be go like this
Teledata Informatics - Predicted 11.7 EPS - Information Technology company - 15 should be the PE but even if marget gives 5 then rate is 70 Rs.
Teledata Marine - Predicted EPS 30 - Shipping and Education - 5 Should be the PE but even at 3 PE the rate is at 90.
Teledata Technology - Predicted EPS 20 - Another IT company - Redington another E.g of similiar profile - 12 should be the PE but even at 5 PE the rate is 100.
So if you invest 55000 today for 1000 shares then the value should be minimum 65000 + 45000 + 50000 = 160000 which is nearly 200 % more than current rate.
Just imagine these are half values so full valuuation can give what rate in a year time.
Also if you see the companies last 2-3 quarters performance then it is sure that they will definately give 50 % of what they are declaring.
AIR DECCAN (Deccan Airways)---Now tradin around 94...for long Term Invsetment...Breakeven in this year
DECCAN GOLD....company is in looses but good to invest a little bit for long term...if they find gold then this stock is going to be gold..now trading arround 13rs...Now the price for yellow metal is at high, more profits due to high price...
Tuesday, April 3, 2007
Finance
Earnings Per Share - EPS
The portion of a company's profit allocated to each outstanding share of common stock. EPS serves as an indicator of a company's profitability.
Calculated as:=Net Income/Avg Outstanding shares
Price-Earnings Ratio - P/E Ratio
valuation ratio of a company's current share price compared to its per-share earnings.
Calculated as: Market value of Share/EPS(Earnings per share)
Market Value
1.The current quoted price at which investors buy or sell a share of common stock or a bond at a given time. Also known as "market price".
2. The market capitalization plus the market value of debt. Sometimes referred to as "total market value".
The 48 Laws of Power
The 48 Laws of Power
by Robert Greene and Joost Elffers
Law 1
Never Outshine the Master
Always make those above you feel comfortably superior. In your desire to please or impress them, do not go too far in displaying your talents or you might accomplish the opposite – inspire fear and insecurity. Make your masters appear more brilliant than they are and you will attain the heights of power.
Law 2
Never put too Much Trust in Friends, Learn how to use Enemies
Be wary of friends-they will betray you more quickly, for they are easily aroused to envy. They also become spoiled and tyrannical. But hire a former enemy and he will be more loyal than a friend, because he has more to prove. In fact, you have more to fear from friends than from enemies. If you have no enemies, find a way to make them.
Law 3
Conceal your Intentions
Keep people off-balance and in the dark by never revealing the purpose behind your actions. If they have no clue what you are up to, they cannot prepare a defense. Guide them far enough down the wrong path, envelope them in enough smoke, and by the time they realize your intentions, it will be too late.
Law 4
Always Say Less than Necessary
When you are trying to impress people with words, the more you say, the more common you appear, and the less in control. Even if you are saying something banal, it will seem original if you make it vague, open-ended, and sphinxlike. Powerful people impress and intimidate by saying less. The more you say, the more likely you are to say something foolish.
Law 5
So Much Depends on Reputation – Guard it with your Life
Reputation is the cornerstone of power. Through reputation alone you can intimidate and win; once you slip, however, you are vulnerable, and will be attacked on all sides. Make your reputation unassailable. Always be alert to potential attacks and thwart them before they happen. Meanwhile, learn to destroy your enemies by opening holes in their own reputations. Then stand aside and let public opinion hang them.
Law 6
Court Attention at all Cost
Everything is judged by its appearance; what is unseen counts for nothing. Never let yourself get lost in the crowd, then, or buried in oblivion. Stand out. Be conspicuous, at all cost. Make yourself a magnet of attention by appearing larger, more colorful, more mysterious, than the bland and timid masses.
Law 7
Get others to do the Work for you, but Always Take the Credit
Use the wisdom, knowledge, and legwork of other people to further your own cause. Not only will such assistance save you valuable time and energy, it will give you a godlike aura of efficiency and speed. In the end your helpers will be forgotten and you will be remembered. Never do yourself what others can do for you.
Law 8
Make other People come to you – use Bait if Necessary
When you force the other person to act, you are the one in control. It is always better to make your opponent come to you, abandoning his own plans in the process. Lure him with fabulous gains – then attack. You hold the cards.
Law 9
Win through your Actions, Never through Argument
Any momentary triumph you think gained through argument is really a Pyrrhic victory: The resentment and ill will you stir up is stronger and lasts longer than any momentary change of opinion. It is much more powerful to get others to agree with you through your actions, without saying a word. Demonstrate, do not explicate.
Law 10
Infection: Avoid the Unhappy and Unlucky
You can die from someone else’s misery – emotional states are as infectious as disease. You may feel you are helping the drowning man but you are only precipitating your own disaster. The unfortunate sometimes draw misfortune on themselves; they will also draw it on you. Associate with the happy and fortunate instead.
Law 11
Learn to Keep People Dependent on You
To maintain your independence you must always be needed and wanted. The more you are relied on, the more freedom you have. Make people depend on you for their happiness and prosperity and you have nothing to fear. Never teach them enough so that they can do without you.
Law 12
Use Selective Honesty and Generosity to Disarm your Victim
One sincere and honest move will cover over dozens of dishonest ones. Open-hearted gestures of honesty and generosity bring down the guard of even the most suspicious people. Once your selective honesty opens a hole in their armor, you can deceive and manipulate them at will. A timely gift – a Trojan horse – will serve the same purpose.
Law 13
When Asking for Help, Appeal to People’s Self-Interest,
Never to their Mercy or Gratitude
If you need to turn to an ally for help, do not bother to remind him of your past assistance and good deeds. He will find a way to ignore you. Instead, uncover something in your request, or in your alliance with him, that will benefit him, and emphasize it out of all proportion. He will respond enthusiastically when he sees something to be gained for himself.
Law 14
Pose as a Friend, Work as a Spy
Knowing about your rival is critical. Use spies to gather valuable information that will keep you a step ahead. Better still: Play the spy yourself. In polite social encounters, learn to probe. Ask indirect questions to get people to reveal their weaknesses and intentions. There is no occasion that is not an opportunity for artful spying.
Law 15
Crush your Enemy Totally
All great leaders since Moses have known that a feared enemy must be crushed completely. (Sometimes they have learned this the hard way.) If one ember is left alight, no matter how dimly it smolders, a fire will eventually break out. More is lost through stopping halfway than through total annihilation: The enemy will recover, and will seek revenge. Crush him, not only in body but in spirit.
Law 16
Use Absence to Increase Respect and Honor
Too much circulation makes the price go down: The more you are seen and heard from, the more common you appear. If you are already established in a group, temporary withdrawal from it will make you more talked about, even more admired. You must learn when to leave. Create value through scarcity.
Law 17
Keep Others in Suspended Terror: Cultivate an Air of Unpredictability
Humans are creatures of habit with an insatiable need to see familiarity in other people’s actions. Your predictability gives them a sense of control. Turn the tables: Be deliberately unpredictable. Behavior that seems to have no consistency or purpose will keep them off-balance, and they will wear themselves out trying to explain your moves. Taken to an extreme, this strategy can intimidate and terrorize.
Law 18
Do Not Build Fortresses to Protect Yourself – Isolation is Dangerous
The world is dangerous and enemies are everywhere – everyone has to protect themselves. A fortress seems the safest. But isolation exposes you to more dangers than it protects you from – it cuts you off from valuable information, it makes you conspicuous and an easy target. Better to circulate among people find allies, mingle. You are shielded from your enemies by the crowd.
Law 19
Know Who You’re Dealing with – Do Not Offend the Wrong Person
There are many different kinds of people in the world, and you can never assume that everyone will react to your strategies in the same way. Deceive or outmaneuver some people and they will spend the rest of their lives seeking revenge. They are wolves in lambs’ clothing. Choose your victims and opponents carefully, then – never offend or deceive the wrong person.
Law 20
Do Not Commit to Anyone
It is the fool who always rushes to take sides. Do not commit to any side or cause but yourself. By maintaining your independence, you become the master of others – playing people against one another, making them pursue you.
Law 21
Play a Sucker to Catch a Sucker – Seem Dumber than your Mark
No one likes feeling stupider than the next persons. The trick, is to make your victims feel smart – and not just smart, but smarter than you are. Once convinced of this, they will never suspect that you may have ulterior motives.
Law 22
Use the Surrender Tactic: Transform Weakness into Power
When you are weaker, never fight for honor’s sake; choose surrender instead. Surrender gives you time to recover, time to torment and irritate your conqueror, time to wait for his power to wane. Do not give him the satisfaction of fighting and defeating you – surrender first. By turning the other check you infuriate and unsettle him. Make surrender a tool of power.
Law 23
Concentrate Your Forces
Conserve your forces and energies by keeping them concentrated at their strongest point. You gain more by finding a rich mine and mining it deeper, than by flitting from one shallow mine to another – intensity defeats extensity every time. When looking for sources of power to elevate you, find the one key patron, the fat cow who will give you milk for a long time to come.
Law 24
Play the Perfect Courtier
The perfect courtier thrives in a world where everything revolves around power and political dexterity. He has mastered the art of indirection; he flatters, yields to superiors, and asserts power over others in the mot oblique and graceful manner. Learn and apply the laws of courtiership and there will be no limit to how far you can rise in the court.
Law 25
Re-Create Yourself
Do not accept the roles that society foists on you. Re-create yourself by forging a new identity, one that commands attention and never bores the audience. Be the master of your own image rather than letting others define if for you. Incorporate dramatic devices into your public gestures and actions – your power will be enhanced and your character will seem larger than life.
Law 26
Keep Your Hands Clean
You must seem a paragon of civility and efficiency: Your hands are never soiled by mistakes and nasty deeds. Maintain such a spotless appearance by using others as scapegoats and cat’s-paws to disguise your involvement.
Law 27
Play on People’s Need to Believe to Create a Cultlike Following
People have an overwhelming desire to believe in something. Become the focal point of such desire by offering them a cause, a new faith to follow. Keep your words vague but full of promise; emphasize enthusiasm over rationality and clear thinking. Give your new disciples rituals to perform, ask them to make sacrifices on your behalf. In the absence of organized religion and grand causes, your new belief system will bring you untold power.
Law 28
Enter Action with Boldness
If you are unsure of a course of action, do not attempt it. Your doubts and hesitations will infect your execution. Timidity is dangerous: Better to enter with boldness. Any mistakes you commit through audacity are easily corrected with more audacity. Everyone admires the bold; no one honors the timid.
Law 29
Plan All the Way to the End
The ending is everything. Plan all the way to it, taking into account all the possible consequences, obstacles, and twists of fortune that might reverse your hard work and give the glory to others. By planning to the end you will not be overwhelmed by circumstances and you will know when to stop. Gently guide fortune and help determine the future by thinking far ahead.
Law 30
Make your Accomplishments Seem Effortless
Your actions must seem natural and executed with ease. All the toil and practice that go into them, and also all the clever tricks, must be concealed. When you act, act effortlessly, as if you could do much more. Avoid the temptation of revealing how hard you work – it only raises questions. Teach no one your tricks or they will be used against you.
Law 31
Control the Options: Get Others to Play with the Cards you Deal
The best deceptions are the ones that seem to give the other person a choice: Your victims feel they are in control, but are actually your puppets. Give people options that come out in your favor whichever one they choose. Force them to make choices between the lesser of two evils, both of which serve your purpose. Put them on the horns of a dilemma: They are gored wherever they turn.
Law 32
Play to People’s Fantasies
The truth is often avoided because it is ugly and unpleasant. Never appeal to truth and reality unless you are prepared for the anger that comes for disenchantment. Life is so harsh and distressing that people who can manufacture romance or conjure up fantasy are like oases in the desert: Everyone flocks to them. There is great power in tapping into the fantasies of the masses.
Law 33
Discover Each Man’s Thumbscrew
Everyone has a weakness, a gap in the castle wall. That weakness is usual y an insecurity, an uncontrollable emotion or need; it can also be a small secret pleasure. Either way, once found, it is a thumbscrew you can turn to your advantage.
Law 34
Be Royal in your Own Fashion: Act like a King to be treated like one
The way you carry yourself will often determine how you are treated; In the long run, appearing vulgar or common will make people disrespect you. For a king respects himself and inspires the same sentiment in others. By acting regally and confident of your powers, you make yourself seem destined to wear a crown.
Law 35
Master the Art of Timing
Never seem to be in a hurry – hurrying betrays a lack of control over yourself, and over time. Always seem patient, as if you know that everything will come to you eventually. Become a detective of the right moment; sniff out the spirit of the times, the trends that will carry you to power. Learn to stand back when the time is not yet ripe, and to strike fiercely when it has reached fruition.
Law 36
Disdain Things you cannot have: Ignoring them is the best Revenge
By acknowledging a petty problem you give it existence and credibility. The more attention you pay an enemy, the stronger you make him; and a small mistake is often made worse and more visible when you try to fix it. It is sometimes best to leave things alone. If there is something you want but cannot have, show contempt for it. The less interest you reveal, the more superior you seem.
Law 37
Create Compelling Spectacles
Striking imagery and grand symbolic gestures create the aura of power – everyone responds to them. Stage spectacles for those around you, then full of arresting visuals and radiant symbols that heighten your presence. Dazzled by appearances, no one will notice what you are really doing.
Law 38
Think as you like but Behave like others
If you make a show of going against the times, flaunting your unconventional ideas and unorthodox ways, people will think that you only want attention and that you look down upon them. They will find a way to punish you for making them feel inferior. It is far safer to blend in and nurture the common touch. Share your originality only with tolerant friends and those who are sure to appreciate your uniqueness.
Law 39
Stir up Waters to Catch Fish
Anger and emotion are strategically counterproductive. You must always stay calm and objective. But if you can make your enemies angry while staying calm yourself, you gain a decided advantage. Put your enemies off-balance: Find the chink in their vanity through which you can rattle them and you hold the strings.
Law 40
Despise the Free Lunch
What is offered for free is dangerous – it usually involves either a trick or a hidden obligation. What has worth is worth paying for. By paying your own way you stay clear of gratitude, guilt, and deceit. It is also often wise to pay the full price – there is no cutting corners with excellence. Be lavish with your money and keep it circulating, for generosity is a sign and a magnet for power.
Law 41
Avoid Stepping into a Great Man’s Shoes
What happens first always appears better and more original than what comes after. If you succeed a great man or have a famous parent, you will have to accomplish double their achievements to outshine them. Do not get lost in their shadow, or stuck in a past not of your own making: Establish your own name and identity by changing course. Slay the overbearing father, disparage his legacy, and gain power by shining in your own way.
Law 42
Strike the Shepherd and the Sheep will Scatter
Trouble can often be traced to a single strong individual – the stirrer, the arrogant underling, the poisoned of goodwill. If you allow such people room to operate, others will succumb to their influence. Do not wait for the troubles they cause to multiply, do not try to negotiate with them – they are irredeemable. Neutralize their influence by isolating or banishing them. Strike at the source of the trouble and the sheep will scatter.
Law 43
Work on the Hearts and Minds of Others
Coercion creates a reaction that will eventually work against you. You must seduce others into wanting to move in your direction. A person you have seduced becomes your loyal pawn. And the way to seduce others is to operate on their individual psychologies and weaknesses. Soften up the resistant by working on their emotions, playing on what they hold dear and what they fear. Ignore the hearts and minds of others and they will grow to hate you.
Law 44
Disarm and Infuriate with the Mirror Effect
The mirror reflects reality, but it is also the perfect tool for deception: When you mirror your enemies, doing exactly as they do, they cannot figure out your strategy. The Mirror Effect mocks and humiliates them, making them overreact. By holding up a mirror to their psyches, you seduce them with the illusion that you share their values; by holding up a mirror to their actions, you teach them a lesson. Few can resist the power of Mirror Effect.
Law 45
Preach the Need for Change, but Never Reform too much at Once
Everyone understands the need for change in the abstract, but on the day-to-day level people are creatures of habit. Too much innovation is traumatic, and will lead to revolt. If you are new to a position of power, or an outsider trying to build a power base, make a show of respecting the old way of doing things. If change is necessary, make it feel like a gentle improvement on the past.
Law 46
Never appear too Perfect
Appearing better than others is always dangerous, but most dangerous of all is to appear to have no faults or weaknesses. Envy creates silent enemies. It is smart to occasionally display defects, and admit to harmless vices, in order to deflect envy and appear more human and approachable. Only gods and the dead can seem perfect with impunity.
Law 47
Do not go Past the Mark you Aimed for; In Victory, Learn when to Stop
The moment of victory is often the moment of greatest peril. In the heat of victory, arrogance and overconfidence can push you past the goal you had aimed for, and by going too far, you make more enemies than you defeat. Do not allow success to go to your head. There is no substitute for strategy and careful planning. Set a goal, and when you reach it, stop.
Law 48
Assume Formlessness
By taking a shape, by having a visible plan, you open yourself to attack. Instead of taking a form for your enemy to grasp, keep yourself adaptable and on the move. Accept the fact that nothing is certain and no law is fixed. The best way to protect yourself is to be as fluid and formless as water; never bet on stability or lasting order. Everything changes.
by Robert Greene and Joost Elffers
Law 1
Never Outshine the Master
Always make those above you feel comfortably superior. In your desire to please or impress them, do not go too far in displaying your talents or you might accomplish the opposite – inspire fear and insecurity. Make your masters appear more brilliant than they are and you will attain the heights of power.
Law 2
Never put too Much Trust in Friends, Learn how to use Enemies
Be wary of friends-they will betray you more quickly, for they are easily aroused to envy. They also become spoiled and tyrannical. But hire a former enemy and he will be more loyal than a friend, because he has more to prove. In fact, you have more to fear from friends than from enemies. If you have no enemies, find a way to make them.
Law 3
Conceal your Intentions
Keep people off-balance and in the dark by never revealing the purpose behind your actions. If they have no clue what you are up to, they cannot prepare a defense. Guide them far enough down the wrong path, envelope them in enough smoke, and by the time they realize your intentions, it will be too late.
Law 4
Always Say Less than Necessary
When you are trying to impress people with words, the more you say, the more common you appear, and the less in control. Even if you are saying something banal, it will seem original if you make it vague, open-ended, and sphinxlike. Powerful people impress and intimidate by saying less. The more you say, the more likely you are to say something foolish.
Law 5
So Much Depends on Reputation – Guard it with your Life
Reputation is the cornerstone of power. Through reputation alone you can intimidate and win; once you slip, however, you are vulnerable, and will be attacked on all sides. Make your reputation unassailable. Always be alert to potential attacks and thwart them before they happen. Meanwhile, learn to destroy your enemies by opening holes in their own reputations. Then stand aside and let public opinion hang them.
Law 6
Court Attention at all Cost
Everything is judged by its appearance; what is unseen counts for nothing. Never let yourself get lost in the crowd, then, or buried in oblivion. Stand out. Be conspicuous, at all cost. Make yourself a magnet of attention by appearing larger, more colorful, more mysterious, than the bland and timid masses.
Law 7
Get others to do the Work for you, but Always Take the Credit
Use the wisdom, knowledge, and legwork of other people to further your own cause. Not only will such assistance save you valuable time and energy, it will give you a godlike aura of efficiency and speed. In the end your helpers will be forgotten and you will be remembered. Never do yourself what others can do for you.
Law 8
Make other People come to you – use Bait if Necessary
When you force the other person to act, you are the one in control. It is always better to make your opponent come to you, abandoning his own plans in the process. Lure him with fabulous gains – then attack. You hold the cards.
Law 9
Win through your Actions, Never through Argument
Any momentary triumph you think gained through argument is really a Pyrrhic victory: The resentment and ill will you stir up is stronger and lasts longer than any momentary change of opinion. It is much more powerful to get others to agree with you through your actions, without saying a word. Demonstrate, do not explicate.
Law 10
Infection: Avoid the Unhappy and Unlucky
You can die from someone else’s misery – emotional states are as infectious as disease. You may feel you are helping the drowning man but you are only precipitating your own disaster. The unfortunate sometimes draw misfortune on themselves; they will also draw it on you. Associate with the happy and fortunate instead.
Law 11
Learn to Keep People Dependent on You
To maintain your independence you must always be needed and wanted. The more you are relied on, the more freedom you have. Make people depend on you for their happiness and prosperity and you have nothing to fear. Never teach them enough so that they can do without you.
Law 12
Use Selective Honesty and Generosity to Disarm your Victim
One sincere and honest move will cover over dozens of dishonest ones. Open-hearted gestures of honesty and generosity bring down the guard of even the most suspicious people. Once your selective honesty opens a hole in their armor, you can deceive and manipulate them at will. A timely gift – a Trojan horse – will serve the same purpose.
Law 13
When Asking for Help, Appeal to People’s Self-Interest,
Never to their Mercy or Gratitude
If you need to turn to an ally for help, do not bother to remind him of your past assistance and good deeds. He will find a way to ignore you. Instead, uncover something in your request, or in your alliance with him, that will benefit him, and emphasize it out of all proportion. He will respond enthusiastically when he sees something to be gained for himself.
Law 14
Pose as a Friend, Work as a Spy
Knowing about your rival is critical. Use spies to gather valuable information that will keep you a step ahead. Better still: Play the spy yourself. In polite social encounters, learn to probe. Ask indirect questions to get people to reveal their weaknesses and intentions. There is no occasion that is not an opportunity for artful spying.
Law 15
Crush your Enemy Totally
All great leaders since Moses have known that a feared enemy must be crushed completely. (Sometimes they have learned this the hard way.) If one ember is left alight, no matter how dimly it smolders, a fire will eventually break out. More is lost through stopping halfway than through total annihilation: The enemy will recover, and will seek revenge. Crush him, not only in body but in spirit.
Law 16
Use Absence to Increase Respect and Honor
Too much circulation makes the price go down: The more you are seen and heard from, the more common you appear. If you are already established in a group, temporary withdrawal from it will make you more talked about, even more admired. You must learn when to leave. Create value through scarcity.
Law 17
Keep Others in Suspended Terror: Cultivate an Air of Unpredictability
Humans are creatures of habit with an insatiable need to see familiarity in other people’s actions. Your predictability gives them a sense of control. Turn the tables: Be deliberately unpredictable. Behavior that seems to have no consistency or purpose will keep them off-balance, and they will wear themselves out trying to explain your moves. Taken to an extreme, this strategy can intimidate and terrorize.
Law 18
Do Not Build Fortresses to Protect Yourself – Isolation is Dangerous
The world is dangerous and enemies are everywhere – everyone has to protect themselves. A fortress seems the safest. But isolation exposes you to more dangers than it protects you from – it cuts you off from valuable information, it makes you conspicuous and an easy target. Better to circulate among people find allies, mingle. You are shielded from your enemies by the crowd.
Law 19
Know Who You’re Dealing with – Do Not Offend the Wrong Person
There are many different kinds of people in the world, and you can never assume that everyone will react to your strategies in the same way. Deceive or outmaneuver some people and they will spend the rest of their lives seeking revenge. They are wolves in lambs’ clothing. Choose your victims and opponents carefully, then – never offend or deceive the wrong person.
Law 20
Do Not Commit to Anyone
It is the fool who always rushes to take sides. Do not commit to any side or cause but yourself. By maintaining your independence, you become the master of others – playing people against one another, making them pursue you.
Law 21
Play a Sucker to Catch a Sucker – Seem Dumber than your Mark
No one likes feeling stupider than the next persons. The trick, is to make your victims feel smart – and not just smart, but smarter than you are. Once convinced of this, they will never suspect that you may have ulterior motives.
Law 22
Use the Surrender Tactic: Transform Weakness into Power
When you are weaker, never fight for honor’s sake; choose surrender instead. Surrender gives you time to recover, time to torment and irritate your conqueror, time to wait for his power to wane. Do not give him the satisfaction of fighting and defeating you – surrender first. By turning the other check you infuriate and unsettle him. Make surrender a tool of power.
Law 23
Concentrate Your Forces
Conserve your forces and energies by keeping them concentrated at their strongest point. You gain more by finding a rich mine and mining it deeper, than by flitting from one shallow mine to another – intensity defeats extensity every time. When looking for sources of power to elevate you, find the one key patron, the fat cow who will give you milk for a long time to come.
Law 24
Play the Perfect Courtier
The perfect courtier thrives in a world where everything revolves around power and political dexterity. He has mastered the art of indirection; he flatters, yields to superiors, and asserts power over others in the mot oblique and graceful manner. Learn and apply the laws of courtiership and there will be no limit to how far you can rise in the court.
Law 25
Re-Create Yourself
Do not accept the roles that society foists on you. Re-create yourself by forging a new identity, one that commands attention and never bores the audience. Be the master of your own image rather than letting others define if for you. Incorporate dramatic devices into your public gestures and actions – your power will be enhanced and your character will seem larger than life.
Law 26
Keep Your Hands Clean
You must seem a paragon of civility and efficiency: Your hands are never soiled by mistakes and nasty deeds. Maintain such a spotless appearance by using others as scapegoats and cat’s-paws to disguise your involvement.
Law 27
Play on People’s Need to Believe to Create a Cultlike Following
People have an overwhelming desire to believe in something. Become the focal point of such desire by offering them a cause, a new faith to follow. Keep your words vague but full of promise; emphasize enthusiasm over rationality and clear thinking. Give your new disciples rituals to perform, ask them to make sacrifices on your behalf. In the absence of organized religion and grand causes, your new belief system will bring you untold power.
Law 28
Enter Action with Boldness
If you are unsure of a course of action, do not attempt it. Your doubts and hesitations will infect your execution. Timidity is dangerous: Better to enter with boldness. Any mistakes you commit through audacity are easily corrected with more audacity. Everyone admires the bold; no one honors the timid.
Law 29
Plan All the Way to the End
The ending is everything. Plan all the way to it, taking into account all the possible consequences, obstacles, and twists of fortune that might reverse your hard work and give the glory to others. By planning to the end you will not be overwhelmed by circumstances and you will know when to stop. Gently guide fortune and help determine the future by thinking far ahead.
Law 30
Make your Accomplishments Seem Effortless
Your actions must seem natural and executed with ease. All the toil and practice that go into them, and also all the clever tricks, must be concealed. When you act, act effortlessly, as if you could do much more. Avoid the temptation of revealing how hard you work – it only raises questions. Teach no one your tricks or they will be used against you.
Law 31
Control the Options: Get Others to Play with the Cards you Deal
The best deceptions are the ones that seem to give the other person a choice: Your victims feel they are in control, but are actually your puppets. Give people options that come out in your favor whichever one they choose. Force them to make choices between the lesser of two evils, both of which serve your purpose. Put them on the horns of a dilemma: They are gored wherever they turn.
Law 32
Play to People’s Fantasies
The truth is often avoided because it is ugly and unpleasant. Never appeal to truth and reality unless you are prepared for the anger that comes for disenchantment. Life is so harsh and distressing that people who can manufacture romance or conjure up fantasy are like oases in the desert: Everyone flocks to them. There is great power in tapping into the fantasies of the masses.
Law 33
Discover Each Man’s Thumbscrew
Everyone has a weakness, a gap in the castle wall. That weakness is usual y an insecurity, an uncontrollable emotion or need; it can also be a small secret pleasure. Either way, once found, it is a thumbscrew you can turn to your advantage.
Law 34
Be Royal in your Own Fashion: Act like a King to be treated like one
The way you carry yourself will often determine how you are treated; In the long run, appearing vulgar or common will make people disrespect you. For a king respects himself and inspires the same sentiment in others. By acting regally and confident of your powers, you make yourself seem destined to wear a crown.
Law 35
Master the Art of Timing
Never seem to be in a hurry – hurrying betrays a lack of control over yourself, and over time. Always seem patient, as if you know that everything will come to you eventually. Become a detective of the right moment; sniff out the spirit of the times, the trends that will carry you to power. Learn to stand back when the time is not yet ripe, and to strike fiercely when it has reached fruition.
Law 36
Disdain Things you cannot have: Ignoring them is the best Revenge
By acknowledging a petty problem you give it existence and credibility. The more attention you pay an enemy, the stronger you make him; and a small mistake is often made worse and more visible when you try to fix it. It is sometimes best to leave things alone. If there is something you want but cannot have, show contempt for it. The less interest you reveal, the more superior you seem.
Law 37
Create Compelling Spectacles
Striking imagery and grand symbolic gestures create the aura of power – everyone responds to them. Stage spectacles for those around you, then full of arresting visuals and radiant symbols that heighten your presence. Dazzled by appearances, no one will notice what you are really doing.
Law 38
Think as you like but Behave like others
If you make a show of going against the times, flaunting your unconventional ideas and unorthodox ways, people will think that you only want attention and that you look down upon them. They will find a way to punish you for making them feel inferior. It is far safer to blend in and nurture the common touch. Share your originality only with tolerant friends and those who are sure to appreciate your uniqueness.
Law 39
Stir up Waters to Catch Fish
Anger and emotion are strategically counterproductive. You must always stay calm and objective. But if you can make your enemies angry while staying calm yourself, you gain a decided advantage. Put your enemies off-balance: Find the chink in their vanity through which you can rattle them and you hold the strings.
Law 40
Despise the Free Lunch
What is offered for free is dangerous – it usually involves either a trick or a hidden obligation. What has worth is worth paying for. By paying your own way you stay clear of gratitude, guilt, and deceit. It is also often wise to pay the full price – there is no cutting corners with excellence. Be lavish with your money and keep it circulating, for generosity is a sign and a magnet for power.
Law 41
Avoid Stepping into a Great Man’s Shoes
What happens first always appears better and more original than what comes after. If you succeed a great man or have a famous parent, you will have to accomplish double their achievements to outshine them. Do not get lost in their shadow, or stuck in a past not of your own making: Establish your own name and identity by changing course. Slay the overbearing father, disparage his legacy, and gain power by shining in your own way.
Law 42
Strike the Shepherd and the Sheep will Scatter
Trouble can often be traced to a single strong individual – the stirrer, the arrogant underling, the poisoned of goodwill. If you allow such people room to operate, others will succumb to their influence. Do not wait for the troubles they cause to multiply, do not try to negotiate with them – they are irredeemable. Neutralize their influence by isolating or banishing them. Strike at the source of the trouble and the sheep will scatter.
Law 43
Work on the Hearts and Minds of Others
Coercion creates a reaction that will eventually work against you. You must seduce others into wanting to move in your direction. A person you have seduced becomes your loyal pawn. And the way to seduce others is to operate on their individual psychologies and weaknesses. Soften up the resistant by working on their emotions, playing on what they hold dear and what they fear. Ignore the hearts and minds of others and they will grow to hate you.
Law 44
Disarm and Infuriate with the Mirror Effect
The mirror reflects reality, but it is also the perfect tool for deception: When you mirror your enemies, doing exactly as they do, they cannot figure out your strategy. The Mirror Effect mocks and humiliates them, making them overreact. By holding up a mirror to their psyches, you seduce them with the illusion that you share their values; by holding up a mirror to their actions, you teach them a lesson. Few can resist the power of Mirror Effect.
Law 45
Preach the Need for Change, but Never Reform too much at Once
Everyone understands the need for change in the abstract, but on the day-to-day level people are creatures of habit. Too much innovation is traumatic, and will lead to revolt. If you are new to a position of power, or an outsider trying to build a power base, make a show of respecting the old way of doing things. If change is necessary, make it feel like a gentle improvement on the past.
Law 46
Never appear too Perfect
Appearing better than others is always dangerous, but most dangerous of all is to appear to have no faults or weaknesses. Envy creates silent enemies. It is smart to occasionally display defects, and admit to harmless vices, in order to deflect envy and appear more human and approachable. Only gods and the dead can seem perfect with impunity.
Law 47
Do not go Past the Mark you Aimed for; In Victory, Learn when to Stop
The moment of victory is often the moment of greatest peril. In the heat of victory, arrogance and overconfidence can push you past the goal you had aimed for, and by going too far, you make more enemies than you defeat. Do not allow success to go to your head. There is no substitute for strategy and careful planning. Set a goal, and when you reach it, stop.
Law 48
Assume Formlessness
By taking a shape, by having a visible plan, you open yourself to attack. Instead of taking a form for your enemy to grasp, keep yourself adaptable and on the move. Accept the fact that nothing is certain and no law is fixed. The best way to protect yourself is to be as fluid and formless as water; never bet on stability or lasting order. Everything changes.
The Art of War
Warfare is the Way of deception. ?
Therefore, if able, appear unable,
if active, appear not active,
if near, appear far,
if far, appear near. ?
If they have advantage, entice them;
if they are confused, take them,
if they are substantial, prepare for them,
if they are strong, avoid them,
if they are angry, disturb them,
if they are humble, make them haughty,
if they are relaxed, toil them,
if they are united, separate them. ?
Attack where they are not prepared, go out to where they do not expect. ?
This specialized warfare leads to victory, and may not be transmitted beforehand
Generally in warfare:
If ten times the enemy's strength, surround them;
if five times, attack them;
if double, divide them;
if equal, be able to fight them;
if fewer, be able to evade them;
if weaker, be able to avoid them. ?
Therefore, a smaller army that is inflexible will be captured by a larger one. ?
Therefore, there are five dangerous traits of a general:
He who is reckless can be killed. ?
He who is cowardly can be captured. ?
He who is quick tempered can be insulted. ?
He who is moral can be shamed. ?
He who is fond of the people can be worried. ?
These five traits are faults in a general, and are disastrous in warfare.
The place of battle must not be made known to the enemy.
If it is not known, then the enemy must prepare to defend many places. ?
If he prepares to defend many places, then the forces will be few in number. ?
Therefore, if he prepares to defend the front, the back will be weak.
If he prepares to defend the back, the front will be weak.
If he prepares to defend the left, the right will be weak.
If he prepares to defend the right, the left will be weak.
If he prepares to defend everywhere, everywhere will be weak. ?
The few are those preparing to defend against others, the many are those who make others prepare to defend against them. ?
Therefore, if one knows the place of battle and the day of battle, he can march a thousand li and do battle. ?
If one does not know the place of battle and the day of battle, then his left cannot aid his right, and his right cannot aid his left;
his front cannot aid his back, and his back cannot aid his front. ?
How much less so if he is separated by tens of li, or even a few li. ?
Based on my calculations, though Yueh's troops were many, what advantage was this to them in respect to victory?
Therefore I say, victory can be achieved. ?
Though the enemy is many, he can be prevented from doing battle.
Therefore, know the enemy's plans and calculate their strengths and weaknesses. ?
Therefore, if able, appear unable,
if active, appear not active,
if near, appear far,
if far, appear near. ?
If they have advantage, entice them;
if they are confused, take them,
if they are substantial, prepare for them,
if they are strong, avoid them,
if they are angry, disturb them,
if they are humble, make them haughty,
if they are relaxed, toil them,
if they are united, separate them. ?
Attack where they are not prepared, go out to where they do not expect. ?
This specialized warfare leads to victory, and may not be transmitted beforehand
Generally in warfare:
If ten times the enemy's strength, surround them;
if five times, attack them;
if double, divide them;
if equal, be able to fight them;
if fewer, be able to evade them;
if weaker, be able to avoid them. ?
Therefore, a smaller army that is inflexible will be captured by a larger one. ?
Therefore, there are five dangerous traits of a general:
He who is reckless can be killed. ?
He who is cowardly can be captured. ?
He who is quick tempered can be insulted. ?
He who is moral can be shamed. ?
He who is fond of the people can be worried. ?
These five traits are faults in a general, and are disastrous in warfare.
The place of battle must not be made known to the enemy.
If it is not known, then the enemy must prepare to defend many places. ?
If he prepares to defend many places, then the forces will be few in number. ?
Therefore, if he prepares to defend the front, the back will be weak.
If he prepares to defend the back, the front will be weak.
If he prepares to defend the left, the right will be weak.
If he prepares to defend the right, the left will be weak.
If he prepares to defend everywhere, everywhere will be weak. ?
The few are those preparing to defend against others, the many are those who make others prepare to defend against them. ?
Therefore, if one knows the place of battle and the day of battle, he can march a thousand li and do battle. ?
If one does not know the place of battle and the day of battle, then his left cannot aid his right, and his right cannot aid his left;
his front cannot aid his back, and his back cannot aid his front. ?
How much less so if he is separated by tens of li, or even a few li. ?
Based on my calculations, though Yueh's troops were many, what advantage was this to them in respect to victory?
Therefore I say, victory can be achieved. ?
Though the enemy is many, he can be prevented from doing battle.
Therefore, know the enemy's plans and calculate their strengths and weaknesses. ?
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