CONTENTS
LETTER
ISSUE CONTENTS
FROM THE
6 October 2011
EDITOR
MONEYLIFE | 6 October 2011 | 10
The EEveronn case shows how an award-winning chairman and wellaward known directors do not necessarily know ensure good governance ensur
DIFFERENT STROKES
W
Debashis Basu
It Just 50 Isa Façade?
Companies are getting social—with mixed effects; Air India: Those who robbed the State carrier are roaming free; Sahara group’s breathtaking investor base
Stock & Role hen the going gets tough, the best funds get going. The Cover Story, an annual feature (our fourth) analysing the top schemes, has identified those funds which are well-poised to perform even in declining markets. Again, we have further improved our methodology for selecting these top schemes which should identify the winners with even greater accuracy. This is crucial because all we can see are dark clouds looming, thanks to the unknown unknowns facing Indian and global markets. The study goes beyond past performance and considers how the schemes have done in the bear periods, for investors to get a better perspective. Very often, I come across financial planners recommending income schemes for the regular income part of the portfolio. We pulled out the performance of income schemes, to figure out whether there is any pattern. Unfortunately, our analysis shows that returns from income schemes are completely erratic. Stay away from them— unless, of course, you know all about interest rate movements. When interest rates go down, income funds do well. But prolonged interest rate declines occur maybe once in a decade. The rest of the time, your income schemes will fetch average to poor returns. Many NGOs have staff strength and width of exposure that would do an MNC proud. We at Moneylife Foundation have managed to expand our membership, attract some of the best specialists and extend our reach with our limited resources—all of which just goes to prove that when you have a great, genuine service, your audience will go that extra kilometre. See inside to sample our packed fortnight at the Foundation and get a taste of things to come. We went to Chennai in early September for our flagship programme “How to be Safe and Smart with Your Money”; this happened to be our most satisfying programme till date. The audience was knowledgeable and participative. Besides, we detected a huge affection for Moneylife there. It was most gratifying.
22
LEGALLY SPEAKING LEGAL
24 Appointments & Disappointments Interference of finance ministry or the PM in the selection of the SEBI head is the norm SMART MONEY
30 Cover Story
Funds for Any Season
Are you the kind who wants equity mutual funds to perform but not leave you deeply worried when the market falls? Here are schemes from 14 fund houses that may be worth looking at
13
Your Interest
Prison for faulty vehicles; Amend APMC Act; Non-advocates can practise in consumer district forums; Share trading to be cheaper; No Indian university in the top 200: Quacquarelli Symonds 2011-12 study; 66 inspectors to check pharma products
26 Promoter Takes All Think carefully before falling into the trap of justifying high valuations on the basis of some ‘hidden’ value
Funds, 28 Bond Anyone? Bond funds or income funds are seen as safe investments. Are they really?
Banks to provide better service; SEBI: Distributors shouldn’t advise; BSE floats liquidity enhancement plans; PPF deposit limit to go up; 7 lakh jobs in H1; IISL’s new indices; New Launches: ICICIdirect eSafe; Personal Loan Swift; Coral Credit Card
16 – – – – –
Muthoot group’s dress code invites ire US diplomatic cable calls Mayawati a ‘paranoid dictator’ Government inaction on many fronts is telling Watch out for what IRDA did not say A $57,000 18-carat gold phone
21 LOOSE CHANGE Moneylife Quiz; Soundbites Disclaimer: Moneylife has a policy of not allowing its editorial staff to buy and sell stocks that are written about in the magazine. All personal transactions in individual stocks are subjected to internal disclosure rules.
STOCKGRADER 39 Momentum
Sadbhav Engineering jumped 3% and M&M gained 4%, while Dish TV tumbled 6%
Medium Term
CRISIL gained 3% and AkzoNobel rose 1%, while Shoppers Stop tumbled 7%
Long Term
HUL climbed 9%, HDFC Bank rose 3%, while Ipca tanked 10% and Marico fell 5%
Fund: 51 Retirement Treadmill Will you outlive your retirement corpus? EVENTS
Foundation 56 Moneylife Events – – –
Foundation’s 1st seminar in Chennai CIC Shailesh Gandhi addressed a seminar on the RTI Act Mutual funds seminar focused on how to choose the right MF for one’s specific needs
FUNDS
14 Your Money Current Account
SAVING AND INVESTING
TRAVEL INSURANCE
44
Insurance Trends
Why Birla Sun Life Century SIP is better than Reliance SIP Insure; SBI’s Life Hospital Cash: No substitute for mediclaim; “Claims are surprisingly low from the 45-60 age group” — Bajaj Allianz General Insurance Fine Print: Chola Fined; LIC Increases Bonus Rates
60 Italy: Art Cities Located in southern Europe and bordered by the Mediterranean Sea, Italy is a country full of rich history and culture that amazes the world
AUTO
STOCKS
35 Street Beat
s 46 Honda’ New Brio Is it a small people’s car or is it a small luxury car?
Automotive Axles: India’s largest independent manufacturer of reardrive axle assemblies; NCL Industries: Strong diversification plans with latest technology
38 Greek & Latin That’s the language the Indian market understands now
Woman’s 66 AWord
Dr Nita Mukherjee finds a fledgling idea that has taken wing—keeping alive women-related history by archiving reference materials ENTERPRISE
WHICH WAY
BEYOND MONEY
48
A Physician Tries To Heal the Medical System
Wellspring Healthcare aims to fill a void in the healthcare delivery system by injecting a dose of professionalism
DEPARTMENTS Letters ............................ 4 Book Review ....................54 Living .............................59 Money Facts ....................63