Nira Radia one of the top lobbyists in India has been exposed through wire taps done by Indian investigative agencies which has been leaked to the media.The conversations in the tape have revealed how this lobbyist has India’s top politicians,bureaucrats,journalists at her beck and call.While it is known that corporate interest wield huge influence amongst Indian government officials,the tapes reveal that Big Business has the government almost completely in its pocket.The 2G Telecom Scam had earlier shown that how top ministers had connived with capricious business houses in swindling the Indian taxpayers of billions of dollars.LIC Housing Finance Scam which has been recently exposed has led to top government company officials being arrested for taking bribes in sanctioning loans to top realty and infrastructure companies.This had been done by a financial intermediary listed on the stock exchange and which had top investors like Goldman,GMO,Fidelity and Morgan Stanley.With the scam exposed these top investment banks have lost their shirt in this investment.

India’s new Corruption Scandal involving a Housing Loan Scam involving Bribes paid to India’s top public bank officials has ensnared top notch financial institutions in the West as well.The whos-who of Wall Street got dazed by spectacular growth and profits of a 3 year old financial outfit in India which had been built on a foundation of lies and bribers.This Corruption Scam was started by a Financial Outfit called Money Matter Financial Services which started as a 2 person outfit.However through arranging of debt to big corporate houses by paying bribes to top officials of India’s large government owned institutions such as Bank of Indian,PNB and others,the outfit saw its share price increase by 7 times.

I have been repeatedly pointing out the dangers of investing in Real Estate Companies as more and more skeletons tumble from the closet.Its an open secret that Real Estate Companies in India fudge their Financial Statements through Creative Accounting and other means such that even Fund Managers don’t invest in the Realty Sector.Major Real Estate Companies like IREO and Emaar MGF have played prominent role in some of the major corruption scams rocking the country.Now more big Real Estate Firms have been implicated for their role in other corruption scandals.DB Realty a Mumbai based Realty Company has been found to be a prime suspect in the LIC Housing Finance Scam where the CBI has arrested.Some construction companies like Man Infrastructure,HCC have also become a target of investigation.

LIC Housing Finance is one of India’s Largest Home Lenders with a huge distribution network around the country.LIC Housing Finance Stock has been on a roll propelled by fast growth of the company and the housing loan growth sector.The Company was a relatively safe investment being promoted by Life Insurance Corporation (LIC) which is India’s largest insurance company owned fully by the government.The Foreign Ownership of the LIC Housing Finance Shareholding is quite high at 40%+ due to its relative safety and high growth.However the Central Bureau of Investigations (CBI) raids on the company has resulted in a sharp 20% price fall.The company’s top officials have been implicated in misappropriation of money and home loan scams along with a company called Money Matters.

Corruption in India has taken a widely virulent and blatant form with scams popping up almost everyday.Greed is Good has become the motto for India’s Role Models in Sport and Military as well.India’s Politicians are Leading the protagonists with Realty being the Main Theme.Note Real Estate companies in India are notorious for corruption with the sector being avoided by Fund Managers.India’s Southern State of Karnataka is known for its IT Industry with capital Bangalore famous as a Knowledge Hub.However the Politicians of that State have made it the Corruption Capital with Bangalore equally famous for Land Grabbing and Real Estate Scams by Bureaucrats and Politicians.While Districts in the State have been made famous by Robber Mining Barons,the capital is famous for Realty Shenanigans.

India has seen a rash of junk IPO offerings in the past year due to the strong bullish conditions.Most of these IPOs have managed to raise money based on stock market shenanigans by Market “Operators”.More than 50% of these micro cap IPO junk has given negative returns but the flow seems unabated as India has become an IPO Pump and Dump Heaven.Aster Silicates,Tarapur Transformers,Prakash Steelage,Sea TV are some of the microcap junk that I have written about earlier.R.R.P Constructions joins the infamous bandwagon trying to sucker money from retail investors.The Company is expensively prices,slow growing (compared to other construction peers),has management that you would not want to trust a dollar with,high debt and still wants you to pay ~25x P/E.There are many better opportunities in the Construction and Infrastructure Space in India right now for example Tecpro Systems and VA Tech Wabag.Here are some R.R.P Construction stock negatives gleaned from its DRHP as I could not find any positive about the company.