Anil Ambani's thirst

Anil Ambani has been on an acquisition spree ever since he and his brother Mukesh split the Reliance empire in two. With his vast kitty and ofcourse reputated name there seems to be no lack of investors ready to finance his interests, the latest of which is the Hutchison Essar stake of 67% in Hutch. Hold your seats for this one. The valuation of that stake is said to be to the tune of $17-18 billion which when converted to rupees is a healthy 75-82,000 crores.

The stock market in India is highly overvalued, pushed upwards more by market speculation, emotional sentiments and a "we have a great future" attitude. That said there seems to be no justification for a telecom company to be valued that high especially since there has been no market consolidation at all before. There are no clear leaders and there is ample opportunity for each player to compete and get a larger share of the Indian consumer pie.

Just for the record the margins in which these companies are playing the telecom game in India is ridiculously low, waging wars more on finding a larger consumer base rather than capitalising on the already exisiting consumers that they have. The mean ARPU (average returns per user) in urban India is around $7 while that in rural India is around $3.

Considering all this wouldn't it be wise for Reliance telecom to use that kitty that it has for acquistions on better infrastructure etc and grow organically rather than get into a bidding war with international conglomerates who are looking for a growth pill from the emerging markets? And considering that the bidding is supposedly starting at the $17billion mark and will definitely move upwards, it would end up being more valuable that RCOM itself. Atleast on this case I think Anil is trying to bite off more than he can chew here.

Airtel Magic - All Cost No Service

Airtel is the largest private mobile services provider in India currently, under the brand of Bharti. They have been reaping the benefits of the growing mobile consumer base and making healthy strides one market at a time. The company has some awesome ad campaigns and probably some of the largest coverage areas in the subcontinent. And now to the cribb.

I have been a customer of Airtel since I came back here in 2004, thats nearly 2.5 years. I was a postpaid customer in Bangalore and now here in Delhi. For starters it was pretty good in Bangalore since I was a customer under Sun Microsystems and well we managed to get some good deals. But when I wanted to get additional services activated or deactivated it was a nightmare. Now around 6 months ago I moved out here to Gurgaon and well decided to stick with Airtel.
0) They did not allow me to transfer my number from Bangalore to Delhi.
1) I got a postpaid connection and first thing they do is set my usage limit to be 700Rs. So if I crossed 700Rs in the first month my service would be automatically deactivated and I wouldnt be able to send/receive calls
2) They don't check for previous records at all. I was an Airtel customer in Bangalore and when I took a connection out here they shouldve atleast given me credit for being a good customer for the past 2 years. I was never late in payments and well thats all that they care about.
3) No Roaming. They are demanding 1500Rs as a deposit to activate my roaming. While this is done hassle free on prepaid cards it seems to be such a big hassle on postpaid. I just cant understand why.

All in all Airtel like any big business house in India seems to treat customers like shit once they have captured the market. The only hope is that TRAI comes up with better policies to help us out with these unnecessary headaches.

Have a wonderful season

Say what you want but noone can deny the warmth, joy and that inherent cheer associated with Christmas. For some it is a time for Santa, for others its simply a time to go all out with the Christmas tree or deck up their roofs with wonderful lights. Say what you want but its just wonderful to meet and greet someone at this time of the year.

So to you all my best wishes for this Christmas season. May there be joy, happines and warmth in your family, with your friends and everyone you know. May you truely enjoy Christmas and all that it stands for. Have a Very Merry Christmas!

Super quote

Google is not a conventional company. We do not intend to become one.

Thats the first line off the first SEC filing by Google Inc. The first page introduced as LETTER FROM THE FOUNDERS - “AN OWNER’S MANUAL” FOR GOOGLE’S SHAREHOLDERS

Online Shopping is Improving

The past mont I placed a couple of orders online for some books via fabmall.com and firstandsecond.com. Initially I was quite skeptical and apprehensive about the mess I was getting myself into. Hell I could just walk out to a bookstore and fetch some of these books in person but well I gave it a try. To my suprise the experience is very pleasant as compared to the mess I've had with indiatimes.com and rediff.com (books) in the past. The new kids on the block seem to have a good customer service focus in place. I sent them a couple of mails bugging them to update me about the status of my shipment and I got quick replies (<24hrs) every time. Pretty cool. And not just that these emails were not simply some automated responses but someone out there really checking up my order and being curteous with his/her response. Some people have noticed the importance of repeat customers in the limited online market in India. As for me it sure feels good to be treated like a valued customer again:)

Google MCap

From $85 to $505 in 732 days....
Now that is impressive if not downright scary. Take a look at the company that we are talking about. With this it has a market cap of around 155 billion ahead of companies like IBM, Intel and the likes and even closing in on Berkshire Hathaway. Wow!!!

This is definitely a tale meant for the records but well considering the true products that google offers it is a bit suprising to see its value at such a high. While its revenues are around a few billion its profits mostly rely on advertisements, which can definitely not be treated as a core revenue stream for a multi-billion dollar company (or atleast the conventional ones)

All the startups out there seem to be wanting to be the next Google. But what would be more interesting is when and if someone out there manages to outperform Google either at Wall Street or in the Valley.