Thursday, 22 February 2007

Rangachary panel feels Margadarsi Financiers may default

By Syed Akbar
Hyderabad, Feb 22: Margadarsi Financiers is likely to default in the return of deposits on maturity, feels N Rangachary Committee.
In its final report submitted to the State government on Thursday, Rangachary Committee, appointed to study the alleged irregularities in Margadarsi Financiers owned by media baron Ch Ramoji Rao, recommended that the State government may attach the properties invoking Section 3 of the Andhra Pradesh Protection of Depositors of Financial Establishments Act, 1999.
The Committee noted that even on an readjustment of the values of the interests in the subsidiary companies, "Margadari Financiers will not be able to garner any resources to enable them to pay off the depositors. In the best situation available to Margadarsi Financiers, it can repay every creditor (including depositors) only 49 paise in a Rupee".
"In the circumstances of the case and on the basis of figures available, Margadarsi Financiers will not be able to meet their obligation to repay the depositors," the committee pointed out.
Chief Secretary J Harinarayana reportedly sent a copy of the report to the management of Margadarsi Financiers seeking its position.
According to the Rangachary Committee report, "asset cover that will be available to creditors is 16.2 per cent as against probable loss which stands at 83.8 per cent. Margadarsi Financiers is likely to default in the return of deposits on maturity and its present activity of utilising the deposits raised to fund its ever-mounting losses and for reinvesting in subsidiary companies will amount to their acting in a manner prejudicial to the interests of the depositors".
The Committee is of the view that unless Margadarsi Financiers undertakes any of the following, it will be difficult for the depositors to recover anything substantial from them towards deposits: (i) introduce additional funds from own sources ,if the family owns any properties or assets apart from those disclosed by Margadarsi Financiers; (ii) unlock its equity holdings in one or more subsidiary companies which have a prospect of being looked into favourably by any investor.
"Margadarsi Financiers prima facie qualify to be treated as a financial establishment under Andhra Pradesh Protection of Depositors of Financial Establishments Act, 1999. Under Section 3 of the Act, powers have been given to attach property on default in respect of deposit. Margadarsi Financiers, as its stands today, will not be able to refund the public deposits in full because of their legal inability to raise any more deposits the funds of the establishment having been irretrievably lost by more than 50 per cent by way of business losses and the greater part of the balance having been invested in illiquid assets," the report pointed out.
According to the committee report, out of the total deposits of Rs 2,610.38 crore as on March 31, 1006, Rs 1369.47 crore are irretrievably lost by way of losses. This works out to more than 50 per cent of the borrowings. I am taking the entire amount of losses as funds lost in view of the fact that even on the basis of details available, the loss on account of depreciation on assets was only around Rs 2.50 crore.
Investments in group companies and sister concerns as on March 31, 2006 came to Rs 988.31 crore. Most of these concerns have been formed as private limited companies under the Companies Act, 1956 in which either the entire or almost the entire share capital is held by the family of Margadarsi Financiers. This amount includes an investment of Rs 9 crore in bonds. Thus, the investment in own business was Rs 980 crore on March 31,2006, the report disclosed.
The committee noted that "a perusal of the balance sheets of these private limited companies reveals that most of the companies had filed their account statements with the registrar of companies for the period ended March 31, 2005. In some cases, the companies were dormant and except for the paid up capital and accumulated expenditure to be written off, had no substantial business".
Only one company, Ushodaya Enterprises Limited, had any substantial business; apparently this company carries on the newspaper and television business of the party. The balance sheet of this company as on March 31, 2005 shows a loss of Rs 917.79 lakh for the year that has been written down against the carry forward of reserves of the company. The loss of Rs 917.79 lakh for that year was against losses of Rs 89.63 lakh made for the previous year.
"The trend of business apparently was towards an increase of losses from year to year and I think that it may be safe to presume that for the years after March, 2006, the same will continue and neutralise the past profits that have been built by the company," Rangachary said.
An examination of the balance sheet(s) also does not reveal the existence of any assets that could, in ordinary course of business, lead to a realisation of a value more than the book value, to indicate the generation of sources to liquidate any liability. In most cases, the individual assets of the subsidiary companies like land, plant and machinery etc. themselves had been secured to the lenders such as banks towards working capital loans etc. taken in some cases, huge liabilities towards taxes in dispute had not been provided. Investments of Usha Kiran Finance Pvt Limited, which had depreciated by more than 40 per cent of their cost had been disclosed at cost in the books.
"The investment by way of share capital and application money towards allotment of shares can only be viewed as sunk costs and not available to Margadarsi Financiers as resources available to them to discharge the public deposits. For one, these investments are not liquid and are not available. For another, the realisation of the investments will either result in losses or take a very long period to achieve in view of the closely held nature of the shares which do not enjoy a ready marketability.

Thursday, 8 February 2007

Robotic surgery to treat cervical and ovarian cancers

By Syed Akbar
Hyderabad, Feb 8: Now it's robotic surgery to treat cervical and ovarian cancers. A team of US cancer specialists is in the city to train local doctors in this new surgical system, which is fast becoming popular in the West.

Robotic surgery is an advanced version of laproscopy, but involves almost no blood loss. Only a small (1 cm) incision is made and the surgeon operates upon the patient sitting on a monitor away from the operating bed.

According to Dr Linus Chuang of Mt. Sinai School of Medicine, New York, USA, the robotic surgery is relatively painless. "This subsequently leads to decreased need for blood transfusions and speedier recovery to daily livings and works," he says.
Dr Linus is part of the robotic surgeons' team which is in the city to attend the two-day international cancer care, education and research conference beginning Saturday. Once the local oncologists are trained in the robotic surgical methods, robotic surgery will become a norm in Hyderabad.

"At present the cost is quite high. Once it is introduced in India, the cost will come down drastically," says Apollo Hospitals senior oncologist Dr Vijay Anand P Reddy, who is organising the international cancer conference.

Cervical cancer is the most common cancer in women in India and the human papilloma virus is the culprit. It is traditionally treated by radical hysterectomy or radiation therapy. Robotic surgery will soon replace the traditional methods of cancer management.

"The intuitive nature of the robotic approach, as well as the magnification, dexterity, and flexibility, combined with the significant reduction in surgeon's fatigue offered by the robotic system, will allow and encourage more surgeons to use this minimally invasive approach to radical hysterectomy," says Dr Linus.

The robotic surgical device consists of an ergonomically designed surgeon’s console, a patient-side cart with three to four interactive robotic arms, a high-performance 3-dimensional vision system and seven degrees of mobility.
Because of the improved visualisation, control and dexterity, the robotic surgical device overcomes the limitations of traditional laparoscopic technology, he said.

Friday, 2 February 2007

Bush visit: Mosques in twin cities will reverberate with Friday sermons directed against the policies being adopted by US President George W Bush

By Syed Akbar
Hyderabad, March 2: Mosques in twin cities will reverberate with Friday sermons directed against the policies being adopted by US President George W Bush against humanity in general and Muslims in particular.
The Sunni Ulema Board and other religious organisations including those managed by the Shia community have decided to devote a part of the Friday sermon before the weekly congregational prayers to beseech the help of Almighty God against the "Satanic" policies and programmes of Bush. Even imams of mosques outside Hyderabad have been urged to condemn the policies of the Bush administration by special invocation of Almighty's mercy on humanity.
Meanwhile, the all-party joint action committee comprising representatives from Majlis Ittehadul Muslimeen, Congress, Telugu Desam and Muslim religious bodies, have given a call for "voluntary bandh" in twin cities. All educational institutions and business establishments managed by Muslims will remain closed to mark the "Black Friday".
Protest rallies will be organised from Sundaraiah Vignan Kendra in Baghlingampally to Indira Park.
Various Muslim groups have appealed to the members of the principal minority community to boycott American products on Friday to highlight their protest. A list of 32 American items is being circulated among Muslims urging them to boycott them at least for one day. Minorities and those "who value human rights" have been urged not to drink American soft drinks during the visit of Bush to the city.
Even as protesters are gearing up to put up a major showdown, the police late last night reportedly rounded up poor balloonwallahs as a precautionary measure. The MBT and other organisations had earlier decided to release in the air black balloons filled with hydrogen. Immediately after the announcement, balloonwallahs have been picked up from their homes

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This Day In History

Mother's Care

Mother's Care
Minnu The Cat & Her Kittens Brownie, Goldie & Blackie

Someone with Nature

Someone with Nature
Syed Akbar in an island in river Godavari with Papikonda hills in the background

Recognition by World Vegetable Centre

Recognition by World Vegetable Centre

Under the shade of Baobab tree

Under the shade of Baobab tree
At Agha Khan Akademi in Kenya

Gateway to the Southern Hemisphere

Gateway to the Southern Hemisphere

Convention on Biodiversity

Convention on Biodiversity
Syed Akbar at the 11th Conference of Parties to the United Nations Convention on Biological Diversity