Corruption leads to decline in India’s Biggest Real Estate Stock DLF – Indian Realty as Corrupt as Ever

19 Oct, 2012 by
India,Real Estate and Construction

Corruption has become quite endemic in India over the last decade or so and it is universally recognized that the present regime in India is the most corrupt in history. However the flow of scams has not stopped. Realty is the most corrupt industrial sectors in India due to its unorganized nature and huge scope for making money through circumventing governed rules and regulations. Real Estate Companies are amongst the worst performers over the last couple of years and the biggest real estate companies have been embroiled in major scandals. Unitech which is India’s 2nd biggest realty company was involved in the telecom scandal. DLF the biggest real estate company has been involved in a number of corruption deals as well.

Now it is again in the highlight as allegations have been raised that it gave sweetheart deals to the son-in-law of India’s ruling Gandhi family. The stock has tanked 5% as doubts were raised about its corporate governance. Note DLF had seen a similar decline when an independent equity research firm in Canada had raised concerns about the company’s poor corporate governance relating to shady related market transactions. The company has also been indicted by the monopoly regulator for fleecing customers of its top residential luxury project in Gurgaon. Realty Investing in India is always a dangerous game with real estate firms involved in all sorts of corruption scandals. Akruti City whose  shares had seen a massive rise some months ago has been implicated by SEBI for  rigging up its share price with the help of a “stock market operator” Dangi. I would have though that these white collar crimes should be punished more stringently. Banning some entities without any jail time will lead to more and more of these stock rigging in the future.

Realty Shares fall on Corruption Concerns is a regular phenomenon

Shares of LIC Housing Finance Ltd., along with those of realty companies Hindustan Construction Co., Oberoi Realty Ltd. and DB Realty Ltd. plunged early Thursday after the companies were named in a loan scandal late Wednesday. The Central Bureau of Investigation Wednesday arrested eight people, alleging they took huge bribes to issue corporate loans. The arrested include four senior bankers at state-controlled lenders, three from a financial services firm and one from India’s largest insurance company. The CBI alleged that the loans in question were given to companies including Lavasa Corp., a unit of Hindustan Construction, Oberoi Realty and DB Realty, as well as some other listed and privately-owned companies.

IBN

Shares in DLF dropped after anti-corruption activists accused the country’s biggest property developer of improper dealings with a member of a prominent politician’s family, prompting denials from the company. The shares were down 3.8 per cent as of 9:59 am, after falling as much as 5 per cent. The benchmark BSE index declined 0.26 per cent.

Activist Arvind Kejriwal, along with colleague Prashant Bhushan, accused DLF on Friday of arranging favourable loans and real estate transactions for Robert Vadra – the son-in-law of Sonia Gandhi, chief of ruling Congress Party. DLF denied the allegations.

Note many stocks have declined sharply in recent times due to their association with tainted businessmen and politicians. Investing in Indian stock markets remains as treacherous as ever as figuring out the equations of crony capitalism is more important than the fundamentals. Here is an earlier article about how to invest in the Indian market where management quality is a choice between Bad and Ugly

Any investor will tell you that the management quality in India is pretty bad with the choice mainly restricted between Bad and Ugly. Though there are some of the better business groups and companies like Infosys, the management quality leaves a lot to be desired. This is a reflection of the general system of the country where endemic corruption is present with politicians and bureaucrats indulging in scam a day, I think the quality of the management plays a big role in the long term returns of the stock. It is highly unlikely that the company stock will give you good returns as the management siphons off the profits and cash through various shenanigans. Management whose past behavior reeks of corruption will unlikely change its behavior in the future and might lead to catastrophic losses as well as was the case with Satyam.

Read More about Real Estate Corruption

Chinese Solar Panels – Review of Cost, Quality, Brands, Modules on Sale

18 Oct, 2012 by
China,Solar Panels

Chinese Solar Panel Industry

China’s Solar Industry is the biggest in the world. Due to the low cost of Chinese solar panels, the market rose from almost nil in 2005 to almost 40%  in 2010. The remarkable growth in the Chinese Solar Panel Industry has been due to the supportive Government, low labor and capital costs and aggressive competition. This has made the higher cost solar panel manufacturers cut their prices in order to retain their marketshare. China has a number of  Tier1, Tier 2 and Tier 3 producers of solar panels. There is also a number of big State Owned (SOE) Chinese conglomerates that are entering the Solar Panel Industry.

Chinese Solar Panels are super cheap. The cheapest global solar panel brands are all Chinese. The current costs range between 60~70 cents per watt. A standard Chinese Solar Panel would cost around 210$ for a 300-watt panel. Read about Five Most Affordable Solar Panel Brands.

China

Here is a list of Chinese Solar Panel Companies:

1) BYD Solar

BYD  is China’s biggest producer of Electric Vehicles and Lithium Ion batteries. The Company got famous when Warren Buffet bought a 10% stake in the company. The company planned to invest 22.5 Billion Yuan on Solar Energy through secured financing. The company has started a 100 MW cell plant in the Shaanxi province and plans to expand to 5000 MW by 2015.BYD signed a $300 million polysilicon supply contract with LDK Solar. BYD Solar Panels are mostly sold in Europe and Australia as of now as the company does not have a global network unlike big solar panel companies like Suntech or Trina Solar. This is also the reason that BYD Solar Panels are one of the cheapest price solar panels being sold. This is also due to the status of BYD Solar Panels being considered Tier 2 which makes them lower priced in the market. Read About BYD Solar Panel Reviews.

2) Canadian Solar

Canadian Solar Inc. is a top Global Module Supplier. Canadian Solar is a vertically integrated company, providing ingots, wafers, solar cells, solar modules, solar power systems and specialized solar products. The Company is headquartered in Canada with factories in China and Ontario. Canadian Solar operates in 11 countries: Canada, Germany, Italy, Japan, Korea, Spain, Australia, the United States, Singapore, HongKong, and China. It is listed on NASDAQ Exchange. Canadian Solar has a wide customer base covering over 50 countries. Canadian Solar provides the solar industry with the widest PV product lines from 0.03W to 305W. Canadian Solar also offers customized PV products and OEM service around the world. The Company sells a wide variety of solar panels, unlike other producers. The Solar Panel Selling Price is also quite cheap.

The Canadian Solar Modules can be broadly classified into 1) Standard Modules, 2) NewEdge Modules, 3) e-Modules and 4) BIPV Modules. You can read more about reviews on Canadian Solar Panels.

3) CEEG Solar

China Electric Equipment Group Corporation is based in Nanjing, China and is a China state owned company.CEEG is one of the top 15 Chinese solar module manufacturers and sells solar panels under the CEEG Brand. Like its name implies the CEEG Group has a major presence in the electrical equipment market and 3 of its 4 divisions operate in this segment.  The company is also listed on the NASDAQ under the CSUN symbol. CEEG’s power transformers and PV products have been qualified for CCC, UL and EU  certifications. It launched the Quasar range of high-efficiency solar panels. In 2004, CEEG got engaged in the PV industry and established China Sunenergy (formerly CEEG Nanjing PV-Tech Co., Ltd). CEEG has  4 solar panel production factories and 600 MW of production capacity. CEEG was originally a solar cell producer and seller before getting into the manufacture of solar panels in 2009 through acquisitions of 2 small solar module producers.

CEEG Standard modules are designed for both residential and commercial, rooftop and ground-mounted, as well as on-grid and off-grid photovoltaic projects. They sell monocrystalline solar panels under the 125 and 156 series which indicates the size of the solar wafers used to make these solar modules. Read reviews on CEEG Solar Panels.

4) Chaori Solar

Shanghai Chaori Solar Energy Co. Ltd. was established in 2003 and is located in the Fengxian district of Shanghai. It has a registered capital of 527 million Yuan and employs more than 1,500 people. Chaori is a vertically integrated company producing of ingots, wafers, cells, modules and also installs PV system. The company sells solar products in Germany, Spain, Italy, Japan and the United States. The company has a wide product range and offers crystalline silicon solar modules, cells, silicon, batteries, ingots and other solar products like solar lights. Read reviews on Chaori Solar Panels.

5) Chint Astronergy

Astronergy was founded in 2006 and is the solar subsidiary of the Chint Group. As a leading integrated solar manufacturer, Astronergy specializes in research, development & production of high performance monocrystalline and polycrystalline cells & modules, as well as amorphous/microcrystalline thin film PV modules. With support from its parent company Chint, Astronergy has become a global total solutions provider for photovoltaic systems.

It has one of the complete PV product lines in mainland China. In collaboration with its parent company, the Chint Group, Astronergy provides not only top-of-the-line solar modules, but also complete BOS components including inverters, array combiner boxes, DC protection, AC protection, and transformers. This has enabled the company to become the first in the industry to provide customizable PV solutions to satisfy a variety of photovoltaic needs, all from a single source.  Astronergy’s parent company, The Chint Group is a leader in low-voltage electrical power transmission & distribution industries. Very recently, Chint-Astronergy completed a 50MW solar PV power plant in Bulgaria. The company is headquartered in China & partnered globally through its offices in USA, Germany, Spain, Australia, Korea & Japan. Read reviews on Chint Astronergy Solar panels.

6) CNPV Solar

CNPV is a semi vertically integrated solar panel producer like most of the other Chinese solar panel makers in the sense that it does not produce polysilicon which is the main raw material for producing solar modules. However, it makes solar wafers, cells and finally the panels in-house. CNPV is one of the bigger Tier 2 Chinese solar panel manufacturers with its factories based in China. The company does not have a big presence in the retail solar panel market as it sells mainly to solar farm developers. However, with solar roofs becoming more important as the government focuses their efforts on residential installations compared to utility installations, it is a matter of time before CNPV becomes available through online and offline dealers for residential solar. Quality wise and price wise the company is comparable to the smaller Chinese solar panel producers like CEEG, Sunink, ET Solar and SunEarth. The company is listed on the NYSE.

The Solar Modules are majorly of two types – Monocrystalline and Polycrystalline. Read Reviews on CNPV Solar Panels.

7) ET Solar

Was founded in 2007. The company is relatively small compared to the biggest solar panel producers like Yingli, Suntech as its capacity is one/fifth the size of these big panel producers. ET Solar is a quasi vertically integrated solar equipment manufacturer with a presence in Europe, North America, and Australia. However, it does make silicon ingot, wafer, cell, module and a variety of BoS component products. ET Solar offers high-quality modules, inverter, tracker, BIPV, PV Kit and other solar products in more than 50 countries and regions in the whole world. Worldwide more than 500MW projects are already finished. The company is not publicly listed but is funded from Private Equity Sources. ET Solar has a good presence in the UK and Australian Markets.

ET Solar sells solar panels in a wide variety of power ratings and their quality is generally regarded as decent without being great. Read ET Solar Panel Review.

8) JA Solar

JA Solar was founded on 2005 and was publicly listed on New York’s NASDAQ stock market (ticker symbol: JASO) in  2007.  The company sells its products to solar manufacturers worldwide, who assemble and integrate solar cells into modules. The company has two solar cell manufacturing facilities, one located in Ningjin and the other in Yangzhou. JA Solar manufactures solar wafers, solar cells and solar modules making it semi integrated. JA Solar has also diversified into manufacturing and installing solar systems becoming a solar EPC Players. Yangzhou JA Solar PV Engineering Co. Ltd. subsidiary company of JA Solar Holdings Co. Ltd. is engaged in the solar PV system projects.

JA Solar is the biggest solar cell producer in the world with more than 2000 MW of silicon cell capacity. The company has one of the lowest costs in the processing of solar cells from solar wafers. The company is primarily a supplier of solar cells to most solar panel producers in Europe and Asia. Unlike its peer Trina and Yingli Solar, JA Solar does not have a good brand name or distribution of solar panels. It is more of an upstream supplier of solar products to solar companies rather than an end distributor of solar panels.

JA Solar primarily sells solar panels as an OEM Solar Panel Producer which means that it sells its solar panels to companies who put their own brand names on solar panels produced by JA Solar. The company also sells polycrystalline and monocrystalline solar panels under the SECUM and MAPLE brand name. Read about JA Solar Panel Reviews.

9) LDK Solar

is one of the biggest producers of solar wafers that are used by crystalline solar panels. LDK Solar was established in 2005 in China. As a vertically integrated manufacturer and supplier of photovoltaic (PV) products, LDK Solar has more than 21,900 employees worldwide. The Company’s headquarters and manufacturing facilities are located in China. LDK Solar manufactures and markets multicrystalline and monocrystalline wafers for manufacturers of solar cells and modules. It sells Solar Panels mostly to other Solar Panel Companies. LDK Solar acquired the crystalline module manufacturing plant of Best Solar in February 2010 to bring the manufacturing capability in-house. It constructed a polysilicon plant with two production facilities near its wafer production plants in Xinyu, China.

The Solar Modules are major of two types – Monocrystalline and Multicrystalline. LDK Solar is one of the lowest cost panel manufacturers today offering panels at just 70-80 cents per watt. Read LDK Solar Panel Review.

10) NESL

Changzhou NESL Solartech Co Ltd. was founded in 2006, with an initial registered capital of 50 million RMB. NESL  is a state owned Chinese company with its own R&D, design and manufacture facilities for solar energy products. NESL’s production capacity is 400MW annually, with over 1,100 employees worldwide. The company also has offices worldwide in America, Germany and Australia. NESL specializes in solar PV panels, solar systems, solar PV application products, wind turbine equipment and solar-wind power systems. The company has experience in the design and production of monocrystalline and polycrystalline solar panels, BIPV modules, on-grid and off-grid solar power systems and solar lighting systems. NESL has mono- and poly-crystalline solar modules ranging between 5W to 300W.  Read more about NESL Solar Panel Reviews.

11) Phono Solar

Phono Solar is a JV between Phono Technologies Switzerland and Sumec Group of China. Phono’s parent company SUMEC Group has been in the  PV industry from early 2004. SUMEC Group Corporation (SUMEC), founded in 1978, is a key member of China National Machinery Industry Corporation (SINOMACH). Phono Solar’s three production facilities will produce more than 500MW of PV Modules in 2011. The products are widely used in many fields such as power station, telecom, transportation, lighting, broadcasting, civil defense, marine etc. The company’s products are made in China and marketed by the Swiss company under the Phono Solar Brand. The Company also sells micro wind turbines which are used in small residential installations. Phono Solar manufactures both monocrystalline and polycrystalline solar panels in the 75 Watts to 240 Watts Range. Also, read reviews on Phono Solar Panels.

12) Renesola

Established in 2005, is a leading global photovoltaic manufacturer. The company has its own R&D team and advanced production equipment. Renesola is a vertically integrated company with complete R&D and manufacturing of polysilicon, silicon wafer, and solar modules. Renesola has a global presence with sales branches established in Europe, the Americas and the Asia-Pacific regions. Renesola Ltd. is a leading manufacturer of silicon wafers & solar modules. This Chinese solar company is one of the lowest cost producers of the solar wafer in the world. It is expanding into other parts of the supply chain. Like LDK Solar, Renesola sells most of its Solar Panels under an OEM Contract.

Renesola Solar Modules are divided into Monocrystalline and Virtus Series. Read About Renesola Solar Panels Review.

13) SunEarth

NB Solar Sun Earth or SunEarth Solar Panels is the Brand of Solar Panels sold by Chinese Ningbo based manufacturer of monocrystalline and polycrystalline solar modules SunEarth Solar Power Co.Ltd. The company is known as NB Solar in USA. It has 4 facilities for silicon (3000 tons polysilicon plant), wafers (40 MW ), solar components and solar system production. The company has been in the solar industry for 45 years which would make it one of the oldest solar companies in the world. However, it seems to have been left far behind in terms of capacity with only 350 MW in 2009. The Headquarters are in Hi-tech Zone, Ningbo, Zhejiang Province, China

Sun-Earth is a major supplier of solar systems to telecom towers in China and portable solar systems to Africa. It claims to have supplied to utility grade systems in Spain as well. However, it does not have much of a brand name compared to listed Chinese solar companies like Trina Solar, Yingli or Suntech. It is a Tier 2 Supplier of Solar Panels like CEEG Solar and BYD Solar Panels. Therefore its solar panel prices would be lower than that of the Tier 1 solar panel suppliers. Read Reviews on SunEarth Solar Panels.

14) Sunlink

SunLink PV was  founded in 2004. Sunlink solar Panels are manufactured by a small company Jiangsu Sunlink PV Technology Co. Ltd based out of China with module production capacity of 200MW. They sell  5W to 300W both monocrystalline and polycrystalline panels. They have IEC61215 Ed.2, IEC61730, UL1703 certificates. Like small Chinese solar panel producers Sunlink solar panels are one of the cheapest available in the market because of the simple reason that they don’t have the brand name of their bigger rivals like Canadian Solar.Their solar panels are of decent quality at a very low price. Read reviews on Sunlink Solar Panels.

15) Suntech

Was the world’s biggest producer of solar panels in 2010 and was one the first companies to set up operations in China. Its example was followed by a host of other Chinese companies. Suntech has been slow to expand compared to the fast growing small companies in China and has lost marketshare to them. It has started to vertically integrate in order to meet the low cost challenge from Trina and Yingli. Suntech makes one of the best quality Solar Panels in China.

The company was founded in 2001 by the solar scientist Dr. Zhengrong Shi and is listed on the New York Stock Exchange. Suntech offers solar products for every application and market, from off-grid systems to homes, to the world’s largest solar power plants. Their solar modules are installed in over 80 countries. Suntech has offices in 13 countries, including regional headquarters in San Francisco, California; Schaffhausen, Switzerland; and Wuxi, China. The manufacturing sites are located in China, Japan and the United States. The Suntech Solar Modules can be broadly divided for Residential, Commercial & Utility Scale purposes.

Read Suntech Solar Panel Review.

Suntech is amongst the five most cheap solar panel brands in the world. Read Five Most Affordable Solar Panel Brands. The prices the solar panels being sold are around $160-200 per 200 watt module.

16) Talesun

Is an international manufacturer of solar cells and modules with offices in Munich, San Jose and Shanghai. The photovoltaic solar cells and modules are manufactured in China in a fully automated production plant. The manufacturing plant is expected to reach 2 GW of capacity by the end of 2012. Recently, Talesun has signed an agreement with the government of Qinghai, China’s largest province. The cooperation deal has a six year term and commits Talesun to develop solar farms in the region, at an annual volume of 150 MW. The company manufactures both monocrystalline modules, with output between 170W – 310W and polycrystalline modules, with output between 220W – 310W. Read Talesun Solar Panel reviews.

17) Tianwei

Tianwei New Energy is located in  in west China. Tianwei New Energy Holdings Co Ltd. (TWNE) is an affiliate of China South Industries Group Corporation (CSGC). Tianwei is a company with over 50 years’ history and  has a well established fully integrated PV industry chain. TWNE engages in the entire value chain of the solar photovoltaic (PV) industry – the R&D, manufacturing, sales and service of polysilicon materials. It is a fully integrated polysilicon, wafer, cell, module and PV system supplier. TWNE has a total investment of about USD1.5 billion. TWNE’s solar panel manufacturing capacity is 500MW. It has six subsidiaries. Tianwei Solar panels can be divided into Monocrystalline & Multicrystalline Modules. Modules are available in the 190W ~ 250W and many more capacities. Read about Tianwei Solar Panel Review.

18) Trina Solar

Is one of the lowest cost manufacturers of Solar Panels in the World right now. This is the reason that the company in a span of few short years has managed to acquire a substantial global market share. Like Yingli and Suntech, Trina Solar Panels are one the best quality amongst Chinese Solar Panels.

Founded in 1997, Trina Solar is one of the world’s foremost PV companies. Fully vertically integrated from the production of ingots to modules into both mono and multi crystalline technologies, Trina Solar offers high-quality modules and solar solutions. With more than 12 offices worldwide, Trina Solar has partnerships with leading installers, distributors, utilities and developers in all major PV markets and is listed on the NYSE.

The Solar Panels come in a very varied range and can be broadly classified for convenience into two categories:

  • By Business Need – Commercial, Residential & Utility
  • By Panel Type – Performance, Aesthetics & Universal

The prices the solar panels being sold are around $160-200 per 200 watt module. Read the Detailed Trina Solar Panel Review.

19) Yingli Solar

Yingli Green Energy is one of the oldest Chinese companies and is completely integrated from polysilicon. The company has been expanding rapidly and has one of the lowest cost structures in the industry. Yingli is the second biggest producer of Solar Panels in China. One of the world’s first fully vertically integrated photovoltaic manufacturers, the company develops, manufactures, and sells high-quality modules under the brand Yingli Solar to a wide range of markets, including Germany, Spain, Italy, Greece, France, South Korea, China, and the United States. The company is headquartered in Baoding, China with over 11,000 employees worldwide & more than 10 branch offices globally. It is publicly listed on the New York Stock Exchange since 2007 (NYSE: YGE). The business model covers the entire PV value chain, from polysilicon production to the assembly of modules. Since 1998, the capacity has grown from 3 MW to over 1 GW, with more capacity expansions of 600 MWp in Baoding, China and 100 MWp in Hainan, for a total of 1.7 GW in production by the end of 2011.

The product range includes high-quality, reliable monocrystalline and multicrystalline modules. Read about Yingli Solar Panel Reviews.

Anti-Dumping Duties

The US imposition of duties on Solar panel imports from China has raised the hackles of the Chinese Government which considers the solar industry to be strategic to its future growth. While it will not affect the Chinese exports in a big way considering the easy workarounds, it has the potential of making the Chinese Government react negatively. The biggest losers could be the Polysilicon companies and Solar equipment suppliers based in the USA. Anti-dumping duties are imposed by the US against the Chinese solar panel companies with the total quantum of duties around 35-36% for most of the Tier 1 Chinese solar panel players.

The US Department of Commerce gave its final ruling on imports of Chinese made solar cells on 10th Oct 2012 after announcing a preliminary ruling early this year. The rates for CVD and AD have been revised in the final ruling. While the countervailing duties (CVD) has been reduced, anti dumping duties (AD) have been increased which means that the effective combined rate remains in the same range.

12 Must Read Solar Stories – What we Found Interesting!

13 Oct, 2012 by
Solar Energy

1) Solar Inverter Prices falling by 5% each quarter ,50% demand to be driven by Asia

2) Aesthetics of Large Solar Farms causes issues in US Towns

3) Saudis want to go from 3 MW to 42000 MW, utility wants 10% electricity from Renewable Power

4) CPV company Soitec finishes seven power plants in Italy using solar modules from German plant

5) Germany will stop subsidies after solar energy capacity reaches 52 GW ( currently 30 GW)

6) Wafer Producer Green Energy Technology not to rent capacity in China ( Why did they want to do it in the first place?)

7) Japan installs 885 MW in first six months of new FIT (Expect this number to double to treble)

8) German solar developer Solarstorm wants to build 440 MW solar farms in Spain ( selling without subsidies?)

9) China to install 4 GW in Second Half of 2012 up from 1 GW in First Half

10) Power hit Indian State to clear Solar Projects in 5 Days

11) Multi Junction High Efficiency Solar Cell Maker Emcore to supply cells to Israeli Satellite

12) Biggest Taiwanese Solar Cell Producer Gintech sees 53% decline in September Revenues

The GWI Weekly Newsletter – Did You Miss Anything?

24 Sep, 2012 by
Green Investing

All posts published on GWI for the Week Ending 23rd September, 2012:

The Solar Industry has become so big and globalized that we miss out on a lot of interesting stories and news. This post will hopefully fill in the missing gaps.

There was massive media hoopla over the announcement of Apple’s new iPhone upgrade………. However the iPhone 5 has not come out with any new feature that seems compelling……… new features for the iPhone 5 over iPhone 4……..

While bankruptcies of leading crystalline silicon and thin film companies………. shutdown of CPV companies have received less press………. Greenvolts is laying off a majority of its staff as support from ABB has stopped………. Crystalline Silicon PV Solar Technology is beating other rivals in the solar race hands down

The Indian Government has been enmeshed in a never ending series of scandals and scams…….. The economic growth has almost halved…… Congress Party is under attack in a massive mining scam ……. The Income Tax and Enforcement Directorate also serve as puppets

The collapse of the Deccan Group which is the owner of one of the largest media groups……. Indian cricket franchise Deccan Chargers…….. The Deccan Chronicle group has debt ………. The banks are to blame for not doing due diligence

The US Federal Bank announced to unlimited Quantitative Easing at the rate of $40 billion a month………. even the Indian stocks joined the rally……… India is already reeling from high inflation of food and energy………. Oil prices are already hitting the triple digit

India’s Brazen Crony Capitalism is nothing new ………. Corruption in India has become rampant with a scam being uncovered………. The recent exposure of the humongous coal mining scam further exposes the loot and plunder of India’s natural resources

The last two years have been brutal for the solar panel industry,………. even the big daddies of the Chinese solar industry are being forced to slash jobs and production as they run out of money .

The QE Infinity program of Quantitative Easing launched by the US Federal Reserve………. Here are some of the intelligent reactions to the QE by the Fed

Dirty Politics and blatant misuse of power is nothing new for Indian citizens ………. Some districts in the state receive 24 hours power supply while some only get 8-10 hours…….. discrimination is based on whether the district has elected an important leader

telecom tower companies in India have banded together to float a contract to buy green power from privately owned…….. Telecom towers manage to get subsidies of thousands of crores each year………. The Government had finally acted by mandating that 50% of the power supplied

Two of the most respected market analysts have radically opposite positions on where the commodity cycle………

Indian real estate prices are one of the highest in the world in terms of affordability………. However real estate prices do fall and can keep falling……… Japan where land prices fell for 21st year in a row in 2012

Cheap crystalline solar panels in India have become a common household item…. ….. families are gifting their daughters’ small solar panels which will help power their new houses………. There are also large swathes where the Indian electricity grid does not reach

China is the world’s largest manufacturer of solar panels………. However the massive oversupply and bankruptcy of western solar companies has led to a massive backlash………. USA has already imposed anti dumping duties while Europe is in the process of doing so

The old MTRP Act had become quite toothless……… Monopolies and oligopolies could operate quite freely……… the situation is changing with the advent of a new authority Competition Commission of India

Pune will see the inauguration of a Waste to Energy plant set up by Concord Blue……… The 1 MW plant which will be expanded to 10 MW eventually promises to solve ………. Waste to Energy has not succeeded in India ………. Major Problems.

India’s CCI to come to the aid of Real Estate Buyers from Oligopolistic Realtor Companies

22 Sep, 2012 by
India,Real Estate and Construction

Indian Real Estate

India has for long lacked an agency to control the monopolistic and predatory practices of Indian companies. The old MTRP Act had become quite toothless after the 1991 reforms and the Indian industry had turned into the wild west. Monopolies and oligopolies could operate quite freely and there was nobody to investigate price fixing and cartelization. Industries like telecom, cement and others saw many such abuses. However the situation is changing with the advent of a new authority Competition Commission of India.

CCI goes extreme against Cement Cartel

However the situation is changing with the advent of a new authority Competition Commission of India. India’s anti monopoly watchdog Competition Commission of India (CCI) had started out a year ago tentatively by finding film producers a pittance of Rs 1 lakh. However with a year behind it, the watchdog has apparently gone to the other extreme by fining top cement companies in India 50% of their profits for the last 2 years instead of the expected 8% of their last 3 year’s revenues (regulation allows for a maximum penalty of 10%). This comes to around Rs 6300 crores which is almost the whole profit made by the industry. Note there is a seemingly lack of balance about its orders going from one extreme to the other extreme. The order against DLF was a good one finding the right balance , however the cement companies one seems too high and will be overturned in all probability by the Appellate Council.

Real Estate under the scanner of CCI

The Competition Commission of India which recently came into being to check the wild west state of the Indian industry has started in a very promising manner. CCI had first ordered India’s biggest real estate company DLF to pay a hefty fine for using its heft and clout to shortchange individual buyers of its luxurious apartment project in Gurgaon. Then it had posted a huge fine on cement companies in India for cartelization. Now CCI is coming out with a ruling against 70 real estate companies in India for forcing real estate buyers to sign one sided contracts which heavily benefit the company at the expense of the buyer. The current round of investigations was kicked off when CCI got a complaint against NCR-based developer Tulip Infratech. The commission decided to expand the scope of the investigation to look at wider practices across the industry and has sent legal notices to developers in the NCR. It now plans to include developers in the western region in its scrutiny.

CCI is specifically examining:

a)      Announcing projects before getting all approvals from authorities

b)      Not revealing all applicable costs to buyers at the time of purchase

c)      One-sided clauses through which a developer can delay completion of projects, increase or decrease the size of apartments, and change building plans mid-way through projects.

Last year, it had imposed a penalty of Rs 630 crore on DLF, the country’s largest real estate company, for misusing its dominant position in Gurgaon and forcing buyers to enter into one-sided contracts in three projects.

Note India’s Real Estate sector is one of the worst in India in terms of illegal and unethical practices. In fact portfolio managers refuse to invest due to creative accounting used by the industry to totally make their financial statements useless from an investor perspective. India’s Real Estate Sector is one of the most unloved sectors in the Stock Market. Even Fund Managers shun this Sector because of the complete lack of trust in the financial statements published by the Real Estate Companies. With the whole industry most unorganized and companies playing with their books, its not a wonder that the sector continues to languish nearly 70-80% of its 2008 peak despite the broader market being only 10% below its all time peak. Real Estate Companies trying to raise funds in the Primary Market have been stymied by the lack of interest and distrust by the investor community. Even the most famous Real Estate Groups are frequently in the news for scams and frauds.

Also Read:

How Coalgate Loot was Spent – 10 seater Bombardier Jets, $15 Million Apartments and Big Fat India Wedding

19 Sep, 2012 by
India

India’s Brazen Crony Capitalism is nothing new to the Greenworldinvestor readers where we have time and again been highlighting how the unholy nexus of politician-businessmen have been looting the country dry.

We recently wrote how on the easiest way to become rich in India is by becoming a politician crony.

India is a country with one of the largest population of poor people living hand to mouth. But becoming super rich in this country is quite easy if you know how. All you have to do is become a political crony and start counting your millions if not billions. Corruption in India has become rampant with a scam being uncovered almost every day. Politicians and Businessmen have been jailed but they have managed to get out on bail using their millionaire lawyers to fake illness and other shenanigans. Some politicians are now involved in both professions with some rumored to be billionaires owning companies through surreptitious means and parking their money in Swiss banks. Business Groups in India see their shares rising and going down depending on which political party wins, proving the nexus between politicians and businessmen. There has been no reforms to separate these two and now powerful politico-business dynasties have started ruling large parts of India.

The recent exposure of the humongous coal mining scam further exposes the loot and plunder of India’s natural resources. According to one businessman there is no option but to indulge in this looting in order to survive.

Big Fat Indian Wedding

If you were in his position, you would do the same thing,” the businessman said, asking not to be identified because his company also received coal fields and did not want to draw attention to himself. “In this country, it’s difficult to survive. Whoever has a master key wants to eat up all of India. Whoever doesn’t have a key is struggling to survive.”

Mr. Jayaswal is building a large house in Nagpur and hosted his two children’s weddings in Phuket, an island in the south of Thailand. For his daughter’s wedding, Mr. Jayaswal flew in 350 friends, business associates and politicians for an event that was featured on the popular Indian television program “My Big Fat Indian Wedding”.

The 2G telecom scam had exposed many of the telecom and real estate tycoons as being nothing more than greasy middlemen who managed to make it big with their political connections and corruption. The Supreme Court had managed to get some of these politicians and businessmen into jails before they used their money power to get out.

Crony Capitalists in India

“DB Realty,one of the biggest beneficiaries of the Real Estate Boom in India now faces the music. This company has found itself in the center of the scam. It is charged with making hundreds of millions of dollars by buying a telecom license cheaply and flipping it for huge profits. With charges of this publicly listed firm having equity holdings from the mafia, DB Realty portrays the worst of India’s Crony Capitalism. The lines between India’s Politicians, Businessmen and Bureaucrats have been blurring. Even petty lobbyists like Nira Radia now command wealth measured in hundreds of crores. It remains to be seen how far the guilty are punished and whether the real ringleaders are brought to book. Note the 2G Telecom Scam has already implicated some of the biggest corporate houses of the country like Unitech, ADAG Group. Other big conglomerates like Videocon, Essar were also involved in winning the licenses.”

Coal Scam exposing different actors but outcome will be the same as forgotten 2G Scam

Just as the media focused on the corrupt in the 2G scam and conveniently forgot them after a new juicy scam came out, the same thing will happen again. Currently the media is bringing out monstrous corruption stories on the beneficiaries of the scam accused, but soon everything will be forgotten and the scamsters will be out of jail free.

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Abhijeet Group Prime Coalgate Beneficiary

10-seater Bombardier jet, a flat in Mumbai that costs Rs75 crore, daughter’s wedding bash in Phuket, real estate in Nagpur running into crores… Manoj Jayaswal, chairman of the controversial Abhijeet Group, sure lives life king-size.
Jayaswal’s leapfrog began after he got five coal blocks, but that would only be half the story.

His group leveraged the free booty by proposing power projects and got Rs22,000 crore of loans sanctioned from various banks. Of this, Rs11,000 crore has been disbursed with no project near commissioning, and that could be the beginning of bigger problems for lenders, said experts.

Monthly interest payments along with salary and administrative expenses run into huge sums, between Rs100 crore and Rs110 crore, for the Abhijeet group.

Marans of the Sun Group are the poster childs of Crony Capitalism in India

Sun TV is one of India’s largest media companies having interests in TV, Print and Cable Networks with a predominant focus in the southern state of Tamil Nadu. The stock used to trade at lofty valuations as it showed strong growth and margins year after year. The promoter of this company are the Marans who are nephews of Karunanidhi chief of the DMK regional political party. With close access to the levers of power, the company owners could manage to drive away the competition using extra judicial means as was seen in the case of Hathaway Cable. One of the Maran brothers is the Textile Minister of India and before that he was the Telecom Minister of India. However Sun TV has started tanking,   as the DMK which was ruling in Tamil Nadu lost the elections to the opposition recently. This has resulted in Sun TV coming under massive pressure, as the new government comes out all guns blazing. The AIDMK is proposing the nationalization of the cable TV network in the state which would lead to massive loss as it is a huge cash generator for Sun TV.

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