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February 07, 2020

Curious Case of LIC India

Finance Minister Nirmala Sitharaman had announced a stake sale in LIC through an initial public offer in the Union. The government primarily plans to meet its fiscal deficit target by achieving divestment of Rs 2.1 lakh crore for FY21 on the back of stake sale in state-run companies. It is looking at IPO of LIC, stake sale in Air India, BPCL, and IDBI Bank as well as by consolidating PSUs in the oil & gas and power sector.

On fiscal consolidation, the Budget conceded a slippage of 0.5 percentage points to 3.8 percent of GDP in 2019-20 but promised to bring it to 3.5 percent next year. In doing so, the government has stayed committed to the Fiscal Responsibility and Budget Management Act, which allows slippage of no more than half a percentage point in a year.

Valuation of LIC:

1.    Enterprise Value of LIC is 36 Trillion Rupees while the m-cap valuation is expected to be ₹8-10 trillion. [Enterprise value = common equity at market value (this line item is also known as "market cap") + debt at market value (here debt refers to interest-bearing liabilities, both long-term and short-term) + minority interest at market value, if any + preferred equity at market value + unfunded pension liabilities and other debt-deemed provisions – value of associate companies – cash and cash equivalents.]

2.    In FY19, LIC generated a surplus of ₹53,214.41 crores and paid ₹2,611 crores as dividend to the government. In FY18, it generated a surplus of ₹48,444 crores and paid ₹2,430 crores to the government. Just for a perspective, RIL had posted a net profit of ₹39,588 Crore

3.    The financial statement of Insurance companies consists of

                       I.        Policyholders Account (Technical Account)

                      II.        Shareholders Account (Non-Technical Account)

                    III.        Balance Sheet

                    IV.        Receipts and Payment Account (Cash Flow Statement)

                     V.        Segmental Reports relating to the funds

It’s very different, and the valuation becomes a bit complex for insurance companies, unlike other companies.

4.    The government aims to mop up ~90,000 crores from the listing of LIC and stake sale in IDBI Bank. (Assumption: They are willing to offload 10 percent of their stake in LIC) The government currently owns 100 percent in LIC. On the stake sale of IDBI Bank, which is substantially owned and controlled by LIC, The government currently holds around 46 percent in IDBI Bank.

5.    Market players fear the IPO could crowd out the secondary market as some investors would have to liquidate their existing holdings to invest in the mega IPO. The biggest IPO to hit the Indian market is that of Coal India, which had mopped up ~15,000 crores a decade ago

Regulation Hurdles in doing so:

1.    All companies are required to offer at least 10 percent in the IPO. The above calculations were also based on that assumption. If the government would be in favour to offload less than 10 percent, then they have to seek exemption from SEBI for the same.

2.    The most important question is whether the sovereign guarantee on LIC’s liabilities will continue (Liabilities for LIC is the insurance cover and claims that LIC do settle) If the government continues with the sovereign guarantee, there would be questions on LIC’s governance. However, if the government decides to discontinue the sovereign guarantee, retail investors will have issues with the quality of assets LIC is sitting on.

[But what is a sovereign guarantee? Sovereign Guarantee is a promise by the Government to discharge the liability of a third person in case of his default. Sovereign Guarantees are contingent liabilities of the Central and State Governments that come into play on the occurrence of an event covered by the guarantee. The guarantee cover of the Government of India (GoI) is limited only to the payment of principal and normal interest in case of default]

3.    LIC is not a company. It’s a corporation. The Committee on Reforms in the Insurance Sector or popularly known as Malhotra Committee Report had recommended repeal of LIC Act and converting the LIC into a company. The government also may have to amend the Section 5(1) of the LIC Act, which presently provides that the paid-up equity share capital of LIC shall be provided by the Central Government after due appropriation made by Parliament by law for the purpose. After getting transformed into the company, it will be governed by the Companies act.

4.    After amendment and listing, LIC will come under rigorous scrutiny and supervision of Irdai, wherein it will have to strictly maintain the solvency margin of 150 percent. LIC has reported its solvency ratio of 1.55 at the end of September 2019 against 1.51 in September 2018. While the solvency ratio threshold fixed by sector regulator Insurance Regulator and Development Authority of India (IRDAI) is 1.50, LIC’s solvency ratio has hovered around 1.5 in the last 11 years, reportedly the lowest in the industry. Solvency Margin: “Put simply, it indicates how solvent a company is, or how prepared it is to meet unforeseen exigencies. It is the extra capital that an insurance company is required to hold. As per the IRDA (Assets, Liabilities, and Solvency Margin of Insurers) Rules 2000, both life and general insurance companies need to maintain solvency margins. While all non-life insurers are required to follow the regulations, life insurance companies are expected to maintain a 150% solvency margin.”

5.    LIC holds more than 10 percent stake in particular companies in the capacity of an institutional shareholder, breaching the 10per cent cap laid down by IRDAI and SEBI.

Government shareholding will have to come down to 75 percent.

6.    For the last five years, LIC’s NPAs have been mounting substantially. While the outstanding bad loans were recorded as Rs 12,213 crore in 2014-15, it increased by 17% to Rs 14,283 crore in 2015-16, and further spiked by 27% to Rs 18,173 in 2016-17 and the figure was Rs 25,241 in 2017-18. In other words, LIC’s bad loans bulged by 145% from March 2015 to September 2019. The NPA of LIC alone is to the tune of 4.5 percent of NPAs of PSBs (The government on Feb 3, 2020, said the Non-Performing Assets (NPAs) of Public Sector Banks (PSBs) stood at ₹7.27 lakh crore as on September 30, 2019.) LIC's gross NPAs rose to 6.10 percent in the first six months (April-September) of 2019-20. Gross NPAs have almost doubled in the last five years. The insurer always maintained a stable 1.5-2 percent gross NPAs.



JANuary 20, 2020

Is India going on for Trade War with Malaysia?

India is planning to widen curbs on palm oil from Malaysia to oil, gas and other products, news agency Reuters reported on Wednesday. India is the world’s biggest buyer of edible oils and has already effectively stopped importing palm oil from Malaysia by asking importers to look elsewhere. According to the report, New Delhi is now planning to restrict buying of petroleum, aluminum ingots, liquefied natural gas, computer parts and microprocessors from Malaysia. Meanwhile, another Reuters report said Malaysia will use diplomatic channels to try and resolve concerns over the palm oil exports.

World Economic Forum’s annual meeting for this FY at Davos is scheduled on 21st – 24th January, 2020 and the sources have mentioned that Mr Piyush Goyal, Minister of Railways and Commerce is not going to meet his Malaysian counterpart Darell Leiking

India imports 70 per cent of its edible oils: soya, rapeseed and palm. Palm oil leads the pack with a 40 per cent share, of which 95 per cent used to be imported from Malaysia and Indonesia. This once made India the largest destination for Malaysia’s refined palm oil.

Malaysia Palm Oil Export: 18.5 Mn tonnes

India imported 24% of the same ie 4.4 mn tonne followed by China at 8 percent. 

3 points to know about this hostility:

1.    Malaysia had joined Turkey and China in raising the Kashmir issue at the United Nations General Assembly (UNGA), with its Prime Minister Mahathir Mohamad accusing India of "invading and occupying the country" of Jammu and Kashmir.

2.    On the citizenship law too, Mr Mahathir commented labelling it as “grossly unfair”

3.    Government of India has also been unhappy with Malaysia's refusal to revoke permanent resident status for controversial Islamic preacher Zakir Naik, who has lived in Malaysia for about three years and faces charges of money laundering and hate speech in India.

Because of these reasons, India has announced the curbs on imports of refined palm oil on Jan 8. Though the official reasons stated for the same has been mentioned to help domestic refiners raise their plant utilization rates, according to industry officials familiar with the matter. In a typical year, India relies on imports for almost all of its supply of the veg oil used in everything from soap to cookies.

The reason for such a stand by the Malaysian PM on internal issues of India can be attributed to these reasons: 

  1. Mahatir is trying to outflank his opposition leader Anwar Ibrahim by playing the Islamic card. He has not just attacked India but also has said things about Israel- Palestine issue to gain that status in religious front.
  2.  Mahatir is of Indian origin. His father, Mohamad Iskandar, was a Penang Malay of partly Indian ancestry. Mahathir's paternal grandfather had come from South India and married a Malay woman. To counter his image of that kind, he has said the statement about India in the past too. 

As of now, Mahathir commented that "We are too small to take retaliatory action," He told reporters in Langkawi, a resort island off the western coast of Malaysia. "We have to find ways and means to overcome that," he added. The experts have been of the belief that India is not going to 

Benchmark Malaysian palm futures fell nearly 10% last week, their biggest weekly decline in more than 11 years as the palm oil was shifted to 'Restricted category' from 'Free' 

About Palm Oil: 

Items that do have palm oil have their ingredients are Lipstick, Pizza, Soap, Biodiesel, cookies, chocolate, ice cream, instant noodles, shampoo. Though palm oil may be associated with these ingredients too.  "Vegetable Oil, Vegetable Fat, Palm Kernel, Palm Kernel Oil, Palm Fruit Oil, Palmate, Palmitate, Palmolein, Glyceryl, Stearate, Stearic Acid, Elaeis Guineensis, Palmitic Acid, Palm Stearine, Palmitoyl Oxostearamide, Palmitoyl Tetrapeptide-3, Sodium Laureth Sulfate, Sodium Lauryl Sulfate, Sodium Kernelate, Sodium Palm Kernelate, Sodium Lauryl Lactylate/Sulphate, Hyrated Palm Glycerides, Etyl Palmitate, Octyl Palmitate, Palmityl Alcohol"

Though few have the view that the ban on imports of Malaysian palm oil might end up hurting those on the poverty line in India, by increasing the risk of food inflation. Though many have argued on the same by mentioning that Indonesia may fill up that shortfall and India will be unaffected by the tension. Indonesia, the world's biggest producer of palm oil, boasts lower production costs and has a bigger share of the market in many palm oil-consuming countries. It has also historically offered palm oil at cheaper prices than Malaysia, although recently Malaysian export prices have slumped below Indonesian rates as Indian buyers retreated from the market. Though it would be interesting to see further developments with Malaysia as well as the ASEAN nations. 

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January 11, 2020

Elon Musk: The man OR myth worth the hype?

Let’s start the article with the EPS of Tesla. For a while you may take EPS synonymous with the profit if EPS gets too technical. Data from Bloomberg Terminal does show that the company has made profits in 5 quarters after it went public in 2010. Out of 40 quarters (10 Years), the company has made a profit just 5 times . There are multiple companies or organizations that are just bleeding money for the last many quarters and we wouldn’t be talking specifically about them but the bottom line remains that Mr. Elon Musk is inching towards to become the ‘Real Iron Man’ of this era. Hence, it becomes more important to understand and know more about the revolution that is underway for a decade now.  

(Note: The title of ‘Real Iron Man’ was first used by Bloomberg on Jun 10, 2014, to refer Mr. Musk)

There are 10 points that summarises Mr Musk and the company itself. In the latter points, I have even mentioned Indian automobile companies justifying the header image with the data file too. 

1.    The electric-car maker posted a surprise profit of $342 million in the third quarter of 2019. Wall Street had expected the company would post a net loss as big as $257 million. Tesla (TSLA) shares soared by up to 20% in after-hours trading. It marked the first quarter Tesla was profitable since the company posted back-to-back profits in the second half of 2018. Before that, Tesla had posted profits only twice since it went public in 2010 — once in 2013 and again in 2016.

2.    Tesla delivered a record 112,000 vehicles globally during the fourth quarter, significantly topping Wall Street estimates and achieving CEO Elon Musk’s year-end sales goal.

3.    Many analyst do believe that Tesla is ‘OverValued’. They are quite cautious about the company as they still haven’t settled for something that could be relied upon for a steady flow of revenue. 

4.    The Tesla Gigafactory in Shanghai opened last year as China's first wholly foreign-owned auto production plant since the government eased regulations, and the sedans delivered this week were Tesla's first made-in-China cars to be shipped out to customers. The Chinese government lifted restrictions on foreign ownership for auto manufacturers in 2018. Previously, foreign carmakers could only produce and sell in China through joint ventures with Chinese companies.

5.    Influence of charismatic CEO: In the recent Bloomberg survey ( _November_2019 , a question was asked to around 5000 Tesla owners. Question: Did the opinion of Elon Musk influence purchases? 55.4 percent responded affirmative (30.8 percent- strongly agree, 24.6% agree).         

6.    Controversies: Elon Musk on 07 August 2018: Tweet: ‘Am considering taking Tesla Private at $420. Funding secured’ His tweet “set off a trading frenzy,” and pushed Tesla’s stock price up more than 6 percent, forcing Nasdaq to halt Tesla trading for 90 minutes until the company gave an official response. The company’s stock price hit the intraday high of $387 before closing at $379.57 on the day of the tweet. It's currently trading at 478.15 10 Jan, (7:59 pm GMT-5, 10 January, 2020·The US Securities and Exchange Commission (SEC) sued Mr. Musk after his tweet. The SEC later claimed that the tweet was “false and misleading.” 

Outcome: Mr. Musk was directed to step down as chairman. Paid a fine of 40 million. Appointed 2 independent directors; Was directed to get his tweets reviewed before posting.

Other incidents include him smoking weed on Joe Rogan Podcast and calling Vernon Unsworth, the diver, in July 2018, a pedo guy in one of his tweet. 

7.    China can be the swing factor for Tesla: The forecasted growth for the EV share for China is quite high. It is as high as 27 percent. Also, Tesla delivered its first China-made cars to its customers and it has come when Mr. Musk has been very popular in missing his deadlines.  

Tesla Killers in the Chinese market are  NIO, XPENG, GEELY, BYD

8.    The combined valuation of Tesla has eclipsed the total market cap of Ford and General Motors combined. 

9.    The combined valuation of Tesla has eclipsed the total market cap of Ashok Leyland, Bajaj Auto, Tata Motors, Maruti Suzuki and Mahindra & Mahindra combined. 

{Just for info: In middle on these, Morgan Stanley Sales & Trading, US, has picked Maruti Suzuki India as one of the world’s top 20 stocks. According to a recent report released by Morgan’s trading arm, India's car market leader is best positioned when demand picks up.}

10. Tesla has become the 3rd most valuable company in the world after Toyota ($228Bn) and Volkswagen ($100.8Bn). 

Tesla stock has doubled since October 2019. It may have eclipsed the valuation of major automobile firms but the fact remains that sale wise, it accounts for just 3 percent of joint vehicle sales volume (Ford and GM). The execution risk more than ever. And the fact remains that the company is about to report its 10th annual consecutive net loss (In the first para we had talked about quarters)

Till then, let’s see how things unfold for the Tesla and the legend, Mr. Elon Musk. 

The excel sheets have been attached to this link for further references: File

The Article may be downloaded as pdf from the following link



2.    Bloomberg Technology – Taylor Riggs







January 9, 2020

Oil prices are steady; But Why?

Oil prices jumped 5 percent after Iran launched strikes against US military bases in Iraq in retaliation for the killing of commander Qassem Soleimani. But by Wednesday afternoon gains in crude had reversed, with prices trading lower than before the Iranian general’s assassination. Having jumped when markets opened to as high as $71.75 a barrel, crude later dropped to below $66 a barrel, a near 9 percent peak-to-trough swing in the course of a day.

So why have oil prices failed to rally despite the tensions in the Middle East?

1.     The crisis is expected to de-escalate. Global cues are meant to calm after Mr. Trump signaled that the US would not respond militarily to Iran’s attacks on American forces in Iraq, in a bid to de-escalate the crisis in the Middle East triggered by his order to kill Iran’s top general, Qassem Soleimani

2.     Saudi Arabia’s state-backed oil tanker giant, Bahri, is temporarily suspending shipments through the Strait of Hormuz following Iranian missile strikes on US military bases in Iraq, according to two sources familiar with the matter.

[ How the Strait of Hormuz is used as leverage and weapon by Iran has been explained in my previous blog Dated: January 3, 2020: India's economy will suffer eventually as the US attacks Iran!!.]

Avoiding the possibility of direct involvement has also made the oil market a bit less fuzzy. 

3.     Russia Crude Oil Production is at a current level of 10.86M, down from 10.90M last month and down from 10.96M one year ago. This is a change of -0.37% from last month and -0.95% from one year ago. The fact remains that Russia has been trimming production for most of the past three years in an attempt to offset a surge in production from the US shale industry. So if the prices get too high, then the POTUS can ask his allies, including Saudi Arabia and the UAE, to boost production to help calm the market and calm down the prices. 

4.     Oil prices are already high: Some traders say the limited price reaction is simply down to oil having already risen strongly in the fourth quarter of last year, with prices gaining about $10 a barrel as concerns over weakening global growth and the US-China trade war receded. Hedge funds already have sizeable bets on rising crude prices, which have largely been established in the past few months, suggesting there may not be the appetite to keep adding more risk to portfolios without evidence of a genuine supply disruption.

5.     Darryl Willis, a 25 year veteran of BP was hired by Google as the VP of Google Cloud Oil, Gas and Energy. And then he shifted to Microsoft as VP Energy Industry. 

His LinkedIn Account:

Google has already signed up with Total to subsurface data analysis for oil gas exploration and production. Microsoft has already partnered with Exxon and Chevron. Amazon provides cloud services to BP and Shell. The Big Tech companies are already betting high on the oil industry. The fact remains that Machine learning can help in providing seismic segmentation to label geological structures important for oil exploration. The amount of data already collected by the Oil industry can be fed to train the machine (AI). In 2018, the oil and gas industries spent an estimated $1.75 billion on AI — a sum that is projected to balloon to $4 billion by 2025. The bottom line remains that the oil industry is optimistic about the R&D happening and the involvement of Big Tech into this sector. Any sort of breakthrough would mean significant production output and the prices are not going to storm beyond a particular upper bound. This reason may seem vague but if that’s so, let’s keep the other 4 points in mind to answer the question in the headline itself :p



2.     https:/ /98d9b0a6-322c-11ea-9703-eea0cae3f0de




January 3, 2020

India's economy will suffer eventually as the US attacks Iran!!

Stena Impero, a British Oil tanker, on its way to Saudi Arabia was dramatically boarded and seized by Iran’s Revolutionary Guard on July 19th, 2019. The Radio message received was:
“If you obey, you will be safe. Alter your course TO 360 degrees immediately” said the Iranian Naval Forces.
Note: In their language, altering TO 360 degrees means to change course so that the compass read 360 degrees or due north.
The oil prices spiked $2 per barrel after the incident.

Let's ignore the quoted lines for a while and try to understand the relation between the US and Iran. The above-quoted para will find its relevance in the last and most importantly, I promise that the justification of the headline too will be explained in the latter part. Just be patient and try to understand the history of animosity.

Pre 1979, Saudi Arabia and Iran constituted to be the twin pillars of the middle east providing stability in the region. Iran shared a much longer border with USSR and to keep the soviet’s influence off the region, the USA sold guns, bombs and virtually any conventional weapon to secure Iran as well the Saudi from soviets. Ultimately the goal was to secure the oil that the US was importing from the middle east. But things fell apart.

Act I: Iranian Revolution 1979

The Iranian Revolution overthrew the monarchy and Iran was declared an Islamic Republic led by Ayatollah Khomeini. But interestingly the monarch which was led by Mohammad Reza Pahlavi, the last Shah shared great relations with the United States. The fact remains that Shah was led to the throne because of the US. Shah was forced to leave his country and was admitted to the US for cancer treatment. Back in Iran, the new government in place demanded his return in order to face the trials for the crime he had been accused of. The demands were rejected by the US.

And then the Unthinkable happened.

Fifty-two American diplomats and citizens were held hostage for 444 days from November 4, 1979, to January 20, 1981, after a group of Iranian college students belonging to the Muslim Student Followers of the Imam's Line, who supported the Iranian Revolution, took over the U.S. Embassy in Tehran.

By Algerian Declaration, the 52 American citizens were set free and were able to leave Iran. One among other key provisions of the accord was that the US would not intervene politically or militarily in Iranian internal affairs.

Also the movie Argo is based on a similar incident of the "Canadian Caper" which was the joint covert rescue by the Canadian government and the CIA of six American diplomats who had evaded capture during the seizure of the United States embassy in Tehran, Iran, on November 4, 1979

The Iranian Revolution terrified the Kingdom of Saudi Arabia and which has led to the cold war between Iran and Saudi Arabia since then. The US is a very strong ally of Saudi. On May 20, 2017, U.S. President Trump and Saudi Arabia's Salman bin Abdulaziz Al Saud signed a series of letters of intent for the Kingdom of Saudi Arabia to purchase arms from the United States totaling US$110 billion immediately and $350 billion over 10 years. The statement has been mentioned to signify how Saudi Arabia is important to the states.

Act II: Tanker War

The Iran–Iraq War began on 22 September 1980, when Iraq invaded Iran, and it ended on 20 August 1988. The so-called "Tanker War" started when Iraq attacked the oil terminal and oil tankers at Kharg Island in early 1984. Iraq's aim in attacking Iranian shipping was to provoke the Iranians to retaliate with extreme measures, such as closing the Strait of Hormuz to all maritime traffic, thereby bringing American intervention; the United States had threatened several times to intervene if the Strait of Hormuz were closed. As a result, the Iranians limited their retaliatory attacks to Iraqi shipping, leaving the strait open to general passage.

How the US was involved in the Iraq-Iran war?

1.    Iraq acquired 60 multi-role military helicopters (MD 500 Defender) directly from the United States in 1983

2.    USS Stark was deployed to the Middle East Force in 1984 and 1987. The ship was struck on 17 May 1987 by two Exocet anti-ship missiles during the Iran–Iraq War fired from an Iraqi Dassault Mirage F1 aircraft. The Reagan administration, however, attributed the blame to Iran for its alleged belligerence in the underlying conflict.

3.    American support for Ba'athist Iraq during the Iran–Iraq War, in which it fought against post-revolutionary Iran, included several billion dollars' worths of economic aid, the sale of dual-use technology, non-U.S. origin weaponry, military intelligence, and special operations training. However, the U.S. did not directly supply arms to Iraq

4.    Iran Air Flight 655 was a scheduled passenger flight from Tehran to Dubai via Bandar Abbas, that was shot down (the flight was mistaken for a jet fighter) on 3 July 1988 by an SM-2MR surface-to-air missile fired from USS Vincennes, a guided-missile cruiser of the United States Navy. The aircraft, an Airbus A300, was destroyed and all 290 people on board, including 66 children, were killed. In 1996, the governments of the United States and Iran reached a settlement at the International Court of Justice which included the statement "...the United States recognized the aerial incident of 3 July 1988 as a terrible human tragedy and expressed deep regret over the loss of lives caused by the incident.”

Act III: Iran Nuclear Deal

By 2002, Iran was fighting multiple proxy wars and the US feared that their Nuclear weapon may fall into wrong hands.

In 2002 State of the Union Address, George W Bush referring to North Korea and Iran mentioned that “States like these and their terrorist allies constitute an axis of evil, arming to threaten the peace of the world” The term ‘axis of evil’ has got a lot of repetitions after then to pinpoint the common enemies of United States.

UN report also revealed that Iran has carried out activities relevant to the development of a nuclear explosive device. The mutual distrust between the US and Iran boiled over. Iran has refused to satisfy legitimate concerns about the nature of its nuclear program. Eventually, The US announced sweeping sanctions against Iran

 [On June 24, 2010, the United States Senate and House of Representatives passed the Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010 (CISADA), which President Obama signed into law July 1, 2010.]

The sanctions again brought Strait of Hormuz into the limelight as Iran threatened that they would not allow a single drop of oil to pass by. The US retaliated saying that they were well prepared to take any action. The economy of Iran contracted for the first time in a decade after the sanctions as oil makes up 80% of their exports.


The Iran nuclear deal framework was a preliminary framework agreement reached in 2015 between the Islamic Republic of Iran and a group of world powers: the P5+1 (the permanent members of the United Nations Security Council—the United States, the United Kingdom, Russia, France, and China—plus Germany) and the European Union.

In all the three acts, a name that has come often is the Strait of Hormuz. A third of the world’s liquefied natural gas and almost 25% of total global oil consumption passes through the strait, making it a highly important strategic location for international trade. The jugular of the world economy seems to have found its relevance again and again whenever Iran has been placed in a discomfort position.

Act: IV: Withdrawal from Iran Nuclear Deal

On May 8, 2018, United States President Donald Trump announced the United States was withdrawing from the deal.

Iran has the world's fourth-largest oil reserves. But sanctions prevented it from capitalizing on that resource. As a result, Iran is only the world's seventh-largest oil producer, pumping 4.5 million barrels per day. In 2018, it exported 1.9 million barrels per day. Without sanctions, Iran had hoped to double that amount once it built up the necessary infrastructure. With the reinstatement of sanctions, exports were projected to plummet to 945,000 barrels per day. In 2018, Iran's unemployment rate rose to 13.8%. Sanctions caused its currency, the rial, to plummet. That's caused its inflation rate to skyrocket to 55% in 2018.

On July 19th, 2019, Stena Impero, a British Oil tanker, on its way to Saudi Arabia was dramatically boarded and seized by Iran’s Revolutionary Guard. It was passing through Strait of Hormuz. I had said that the quoted text will find its way.

The above clearly states how US and Iran relations have only deteriorated over the years but most importantly mentions as to how the strait is used as leverage by Iran to oppose their opponents

Act V: Things that could have been avoided 

These 4 incidents happened as the world was on the verge to enter a new decade.

1.    December 28, 2019: A US civilian contractor was killed Friday in a rocket attack on a base near Kirkuk, Iraq, where US service members and civilian contractors were located. The attack was linked to groups backed by Iran.

2.    The 2019 U.S. embassy attack in Iraq happened in Baghdad, Iraq, on 31 December 2019. Iraqi militiamen, pro-Iran protesters, and supporters of the Kata'ib Hezbollah, an Iran-backed militia, attacked the U.S. embassy in response to U.S. airstrikes on 29 December 2019 that killed 25 fighters of Kata'ib Hezbollah in Iraq

3.    Maj. Gen. Qassim Suleimani (architect of nearly every significant operation by Iranian intelligence and military forces over the past two decades) was killed in an American drone strike in Baghdad on Friday.

4.    His death is a considerable blow to Tehran, and Iran’s supreme leader, Ayatollah Ali Khamenei, called for retaliation on Friday and for three days of national mourning.

The #WWIII and #Worldwar3 were the trending topics on Twitter on 3rd January. But the most significant point remains that India has a lot to lose in these things.

Point A: The Strait of Hormuz is again going to be affected in between this feud. And this is something we can very sure about as we have read about the history of the nations. India is in a no state to handle further distress to the economy as the current economic slowdown has come at a time when the oil prices are at a record low. This, in fact, has been stated as a cushion and widely mentioned that this government has been lucky in this regard. But the fact remains that the spike in the oil prices is going to make things worse. Iran’s Oil imports to India has dipped to 1.7 mt in the current fiscal year down from 23.9 mt in 2018-19. But still, we import 226.5 mt (during FY19) that has cost India about $111.9 Billion. This is when the crude prices are at $61.18 per barrel (It was $106 per barrel in July 2014)

The News: Oil prices jump after top Iranian general killed by US – BBC

Point B: Reliance Industries toppled the IOCL as the largest company in India in terms of revenue. I am mentioning this fact because this company is one of the major index heavyweight of Nifty50 and Sensex. Reliance mentioned earlier that they have the plan to become the zero-net debt company. Their plans have been drawn on the altars of partnership that they are looking forward to forge with Aramco and BP (Both being, Oil-based company). With the recent developments in the oil market, we could see that a chunk of investors’ money wiping out because of the escalation.

Point C: Nevertheless, the positive sides are that macroeconomics factors have been quite stable for the nation. We have healthy foreign exchange reserves. The data reached an all-time high of 413.0 USD bn in Oct 2019 and a record low of 1.1 USD bn in Jun 1991 (just for a perspective). This would mean that we have enough cushion to shrug off the exchange rate fluctuation that the economy may face in the wake of the oil price fluctuations. Though weak rupees would mean a lower dollar return for foreign investors and making India an unattractive market for investment.

Point D: In the domestic stock market, oil-linked stocks like Spice Jet, InterGlobe Aviation; Paints stocks like Asian Paints, Berget Paints, and Nerolac may face the brunt. BPCL, HPCL, and IOCL are too not going to be spared.

Point E: For a country like India which meets 80 percent of its oil demand through imports, any further rise in crude prices may have an impact on government finances. Every $10 a barrel rise in crude oil prices expands India’s current account deficit (CAD) by 0.4 percent of GDP. Every 10 percent increase in crude oil prices can push up the inflation rate by 20 basis points.

The preventive measures for the same distress may find its way to the highly talked next budget.

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  3. //


December 29 2019


Fig a 


Fig b


Fig c


Fig d


Fig e

Indices, Stocks and Cues

The S&P BSE Sensex Index has given returns of 15.26 % while the Nifty 50 has given a return of 12.73 %. But in comparison to other indices at Asian level or world level the performance has been dismal. If we talk about the Benchmark Indices Global compiled by Reuters in which 36 indices are taken account into, the performance of Indian indices have been in the bottom 10. The list are as follows: 

Bottom 10 Performers:

Refer Fig a in  above section

Top 10 Performers:

Refer Fig b in  above section

The major events that kept market going fuzzy were:

1.  RBI slashed the policy rates 5 times for a cumulative 135 basis point this year. 

2.  The Sensex tumbled almost 400 points on Budget day, with another 793 points when markets opened the next Monday, logging its biggest one-day fall this calendar year.

3.  Corporate Tax slashed by 10 percentage { Base Corporate Tax lowered from 30% to 22 % ; 

4.  US Treasury Yield Curve inverted for the 1st time since June 2007

5.  Sensex crossed 40000 mark while the Nifty crossed 12000 mark

6.  Fitch, Moody slashed India’s GDP growth forecast to 5 or sub 5 percent in the wake of weak household consumption and contraction in manufacturing output. 

If we talk about the Percent change wise, then the biggest winners for this year were Bajaj Finance Ltd, Bharti Airtel, ICICI Bank Ltd. The full list can be seen in the chart. 24 stocks gave positive returns while the rest of 26 ended up in red zone. 

Refer Fig c in  above section

If we talk about the returns of stocks in the last decade listed currently in Nifty 50 then the figures are as follows: 

Refer Fig d in  above section

For a perspective, these popular stocks had such gains in the last decade. 

Refer Fig e in above section

Further analysis may be done on the basis of sector and a notion may be proposed though I leave it to the discretion of the reader to analyse the same. 


1. Stocks do get dropped and get included on a predefined time to time basis. So the current Nifty 50 has been used for the results. 

2. Dominos have made a substantial gain but because of some data issue, it could not be included in the final list. 

The excel sheets have been attached to this link for further references: File






5.  Thomson Reuters Eikon Terminal


December 27 2019

The Great Indian Economic SlowDown

Arvind Subramanium has again been in the news with a very informative and well-explained paper of his name: “India’s Great Slowdown: What Happened? What’s the Way Out?”We all have been talking about the slowdown at the behest of the parameters available in the public domain. But his recent paper co-authored with Josh Felman has been very elaborate on its way to mention the key factors lucidly and even pointing out the remedies possible.
Few factors are:

1. The collapse in Commercial Loans: Rs 22 Lakh cr was Housing loan sanctioned in 2018-19, while it has reduced to Rs 1 lakh cr in 2019-20 (6 months data)

2. Credit Crunch: Credit is the grease that runs The economy. ILFS saga in tandem with the major irregularities found in the functioning of other Infra companies have tapered off the flow of credit. In fact, the companies are paying more in bank interest than their earnings. The Nominal GDP growth rate taken as a proxy of Likely earnings would result in these data-

Interest Rate on Loans: 10.5 %

Likely Earnings: 6.1 %
This is no sustainable way forward with these rates and things will go worse before the situation gets better.

3. Budget Deficit doesn't show the true picture: Restricting the deficit to 3.3 % is a healthy figure. It also shows that the economy can relax the percentage point upwards to boost the economy if the government wants so. But there is a problem. For better explanation, you may refer to this one:
But the summary is that the real deficit may be up to 6-7 percent depicting that there is no space for increasing the budget deficit in the name of boosting the economy.

4.  Housing Sales: Considering the Top 8 cities (2019), the housing sales tuned up to 2 Lakh cr. But the unsold houses amounts to 8 lakh cr. That's terrible. The demand has been meager in the face of supply. The more worrisome fact is that a percentage of the loans sanctioned by the NBFCs and Banks to these Infra players are not going into building new estates but just to maintain the already existing inventory that they have.

5.  Electricity Generation (Growth percentage): It's even worse than the 1990 crisis falling to the meager 1 percentage point.

6.  Double Twin Balance Sheet challenge: With growth collapsing, India is now facing a Four Balance Sheet challenge—the original two sectors, plus NBFCs and real estate companies. In this situation, the standard remedies are no longer available. Monetary policy cannot revive the economy because the transmission mechanism is broken. Fiscal policy cannot be used because the financial system would have difficulty absorbing the large bond issues that stimulus would entail. The traditional structural reform agenda—land and labor market measures—will not address the current problems.

And these all come at that time when we have been quite lucky with the prices of Crude falling from $ 106 in 2014 to $ 61.11 per barrel as of 24th December 2019. Meanwhile, the RBI cut interest rates by a cumulative 135 basis points during 2019, more than any other central bank in the world over the period and one of the largest rate reductions in India’s history, in the hopes of reviving lending. But lending continues to decelerate, and investment remains mired in its slump

Nevertheless, the positive sides are that macroeconomics factors have been quite stable for the nation. We have healthy foreign exchange reserves. The data reached an all-time high of 413.0 USD bn in Oct 2019 and a record low of 1.1 USD bn in Jun 1991 (just for a perspective). This would mean that we have enough cushion to shrug off the exchange rate fluctuation that the economy may face. The inflation has been well contained in the limits.
The remedies suggested by the eminent scholar are these:

  1. Fix India Data problem. There has been a concern about the validity of the GDP, NPAs figures.
  2. The Bankruptcy code: Consider the big picture. Only Rs 2 lakh crore has been resolved through the IBC so far (with recoveries of just Rs 83,000 crore), a small fraction of the initial stock of NPAs. At this rate, it will take a very, very long time to solve the bad debt problem
  3. Increase supervision of NBFCs
  4. Allow new GMO Crops (It's controversial. Safety concerns led 38 countries, including 19 in Europe, to officially prohibit their cultivation)
  5. Do not raise GST rates and Do not cut personal tax.

The fact remains that our Finance Minister has got a tough job. It may sound funny but when Mr. P Chidambaram on being asked by Rajdeep Sardesai, what would you do if you were Nirmala Sitharaman, he said "I would resign. If my assessment was so wrong, I would resign". All eyes are on Budget 2020-21 which may be presented by the minister on February 1.

For such articles in your inbox, subscribe here. And do let me know in case of any errors that may have crept in. Have a wonderful day.



November 24 2019

Unemployment, LFPR and Double Whammy

India's unemployment rate (Urban: 9.3% Jan-March 2019) has been increasing in recent years. And I am sure that you must have come across this article and we will not try to debate on the same. But there is one interesting thing to notice about. 

So the methodology used for the report quoted here is called "current weekly status" method which gives an average picture of unemployment in a period of 7 days preceding the survey period. A person is considered unemployed in a week if he did not work even for 1 hour during that week. Now the unemployment rate is determined by dividing the number of unemployed people with the people actively seeking a job. LFPR (Labor Force Participation Rate) may be taken as the proxy for the denominator which is the section of the working population in the age group of 16-64 in the economy currently employed or seeking employment.

But the irony is that the LFPR (64% in 2004-05; 49.8% in 2017-18) in itself is decreasing in India which is a grave matter of concern than the unemployment rate itself. Because that would mean that even when a lesser proportion of people are seeking job, a higher proportion of them are not getting one. 

This is what has been termed as Double Whammy by Mahesh Vyas, CEO of CMIE. 


1.  Business Standard TUESDAY, 19 NOVEMBER 2019, Mumbai City Edition 






November 20 2019

Dungeon Dragons and Netflix

Virtual economy is an emergent economy existing in a virtual world, usually exchanging virtual goods in the context of an Internet game. Now we are talking of an economy worth $160 Billion that does experience the dynamics of real economics. I mean, the prices of items do fluctuate as per the demand and supply convention, have an exchange rate, and even experience hyperinflation (Diablo III Auction House). We are talking about the items like a special sniper available for a price in games like Counter-Strike, skin, stickers, or surf boost that you may get while playing Subway surfer. People are buying these stuff with real money. Virtual markets for In-game goods for a 2018 estimate is roughly at $ 45-49 Billion while the Global box office collection for that year was worth $ 41.1 Billion(Just to put in perspective). Well, that’s how Pokemon Go made $795 million of revenue in 2018 even though you didn’t pay a cent for downloading it. (Freemium Model) 

Recently I came across a group that had two exciting opinions on Reddit: 

1. Disney Plus is not a competitor to Netflix. If a person wants to stream House of Cards, Stranger things, or something similar, he will go for Netflix. Period. It's more about the content than the platform. 

2. Twitch (Video live streaming service) is a real threat to Netflix. An average twitch user spends 95 minutes daily on the platform, keeping you hooked. That’s what is making these streaming platforms a kind of worried. (Twitch was acquired by Amazon in 2014 for $ 970 Mn)

Games are changing the landscape. Google Stadia got launched on November 19, 2019. The concept of playing heavy games right away from your chrome browser without downloading the actual content (size of GBs) irrespective of whether you have an i3 machine or i5 is very fascinating and a real deal. Google is also exploring further ways to reduce latency, using an idea called "negative latency," which involves prediction of user input through various means so that any apparent network lag between controller and game response is minimized. The service has received mixed reactions, but it will get improvised for sure, given that expertise that Google does have with their software arm. 

The gaming industry is already making a lot of waves in the contemporary world. China has announced a curfew on online gaming for minors to curb video game addiction. Under the new rules, gamers aged under 18 will be banned from paying online games between 10 p.m. and 8 a.m. On weekdays, minors can only play for 90 minutes, while they may play up to three hours per day on weekends and public holidays. A heavy blow to Tencent, perhaps. 

Though a lot of behavioral science goes in behind the scenes. Now we all know that you never purchase any kind of item with real cash. You buy virtual coins/gold bar at a certain exchange rate by paying real cash. And then with those coins/gold, you purchase the in-app goods. When you pay cash for something, you see it leave your hands, and you get a very immediate sense of depletion, but while paying for cards, that’s already saved in your google account, you tend to spend more in comparison to real cash for the same utility and item. Also, developers do analyze the data about the time stamp when the users closed the application or game. The developers try to answer these questions: Did the user quit because the level was difficult?  They are unable to kill the dragon or what? The pain points are analyzed, and developers then may incentivize you to keep on playing by offering that the entire level may be skipped by paying this amount, or you may unlock a special weapon at this stage. 

Some of the other facts are: 

a. 2018 DOTA 2 Int’l prize money was $ 25.2 Million, and that puts it ahead of Daytona, Tour de France, or even US Open (Golf) in comparison to prize money.

b.  Global e-sports audience is approaching 500 million by the end of FY202

c.  According to TwitchTracker, 560 billion minutes of Twitch was watched over 2018 – rising from 255 billion minutes in 2017 – an increase of 58%. And that’s too when the site is banned in China.

The bottom line is this simple line that Mr. Ben Gilbert used in his article on Business Insider. 

“I've been playing games on Google's ambitious new Netflix-like game service for the last week, and it's clear the service isn't ready for primetime.” 

So if a person got hooked, he would be less switching for media content. Right?  And if he got caught again, would he buy all those Predator, Razor, ROG series? 

And I would conclude by quoting,  “Are you getting it?”








November 17 2019

Profit, Parliament and Privacy

The Parliament session is scheduled from November 18 to December 13. And there is one crucial bill, pending that’s going to affect each and everyone in some manner. 

“Personal Data Protection Bill”

The report drafted by Justice BM Srikrishna committee, which also had our former director of IIM Indore, Prof. Rishikesh T Krishnan as a member too, has heavily influenced the bill, though there are remarkable deviations too which will not be explored in this article.  The report may be found here:

The proposed law mandates storing of personal data within the territory of India requires to obtain explicit consent from the users to collect and use their data and proposes of setting up of Data Protection authority to decide on violations of a data breach. It also proposes a fine of Rs 15 crore or 4% of the firm’s turnover in the case of a breach. 

A circular mandating all payment companies to store data of Indian customers within India has already been issued by RBI and is in effect. The companies affected were because of this norm were: Visa, Mastercard, Infosys, Paytm, Flipkart, Google, and many more. 

Current Status:

1. A 2018 survey found that 52% of Indian companies with $100 Mn-$1 Bn revenue reported a data breach.

2. India digital economy is worth $200 Billion with a strong reported growth 

3. The recent report of NSO, an Israeli Surveillance firm being sued by WhatsApp for breaking into phones of roughly 1400 users across 4 continents, created a stir. 

4. Assessing privacy and state of surveillance in 47 countries, UK-based Comparitech in a study this week placed India among the bottom five non-EU nations when it comes to protecting the privacy of its citizens. 

The report highlights such 

· Its Data Protection Bill is yet to take effect and there isn’t a data protection authority in place, meaning privacy protections are weak at present

· The Aadhaar Identification Scheme gives citizens a unique ID number and is also home to the largest biometric database, which contains 1.23 billion people

· This database also contains information such as purchases, bank accounts, and insurance

· Trying to get WhatsApp to make messages traceable by adding a digital fingerprint to every message sent

· CCTV isn’t regulated, and any privacy laws relating to it are very vague and open to interpretation

· 10 government agencies have recently been given the authorization to decrypt, monitor, and intercept data on any computer (but this must be approved by the Home Secretary)

· Should service providers fail to offer intercept capabilities, they could face prison for up to seven years

· Looking to install hi-tech border surveillance at certain borders

· Frequently shares information with the US and has multiple Mutual Legal Assistance Treaties with different countries

· Ranks 140th in the world for the Press Freedom Index with 6 journalists (at least) being killed in 2018.”

(The highlights are the excerpt of the report which can be accessed here: )


1. The EU, which was successful in passing and enforcing the world’s first data privacy law, the General Data Protection Regulation (GDPR), described India’s overall data localization requirements in the draft Personal Data Protection Bill as “unnecessary, harmful, and likely to have negative effects on trade and investments.”

2. Using advances productivity measures such as firm-level and industry level, Total Factor Productivity & Labor productivity, ECIPE tried to calculate the impact of such stricter data policies on the sectors and industries reliant on data. If similar calculations are assumed for the Indian economy, the current draft Personal Data Protection Bill could cost India nearly $8.4 billion (60350 cr) annually. For the perspective, Reliance industries, annual profit clocks roughly at 35000 cr. The report can be found here:

3. Increases the cost of operation by 30 percent, making overseas companies unhappy.

JioMoney and Paytm are more vocal about the same while US giants are crying foul. An interesting fact is that investors such as Berkshire Hathaway, SoftBank, and Alibaba have backed Paytm with significant funding. It would be interesting to follow the recent developments and their impact on Indian Landscape. 








november 14 2019

Tweets that Shook Fortune 500 Companies

1. Tencent:

Daryl Morey (General Manager of Housten Rockets) on 04 October 19:

Tweet: “Fight for Freedom, Stand with HongKong” 

As Yao Ming from Shanghai, China was selected for Housten Rockets for the 2002 NBA, things changed forever for Basketball as a game in China. It Boosted the league’s popularity. The following data very explicitly do the talking: 

2015: Tencent acquired exclusive digital streaming rights for NBA games in a 5-year contract worth $500 million  ($100 million per year)

2019: The tech giant extended the rights to 2025; Contract worth $1.5 Billion ($ 300 million per year)

Viewership for NBA Games in China (650-750 million) is almost 5-6 times that of the US (90-110 million). Just for a comparative perspective, IPL Season 2019 had a viewership of 462 million, and the entire population of the US is 372.2 million. 

But the tweet didn’t auger well. Chinese Consulate in Housten responded by saying that they were ‘deeply shocked by the erroneous comments on HongKong’ 

For the damage control, Mr. Morey took down the tweet, players apologized and expressed their love for China and their fanbase. But perhaps it was too late. 

Smartphone Maker VIVO, broadcaster CCTV, and internet giant Tencent suspended all cooperation with the NBA or Housten Rockets itself. This had a significant impact on Tencent as a listed company. Alibaba ($ 435 Bn) and Tencent ($ 398 Bn) are just the 2 Non-US and Chinese companies that make into the US-dominated ‘List of public corporations by market capitalization.’ With the recent developments, the gap with Alibaba has widened much further. 

China has made it very clear that they don’t like others to meddle in their issues like HongKong or 3T (Taiwan, Tibet, and Tiananmen). There is a price that needs to be paid if done so, and now there lies a risk of importing Chinese Censorship along with profit that organizations look forward to reap because of the presence of 1.4 Billion people that China has and can really make a difference.

2. Tesla:

Elon Musk (Needs no introduction) on 07 August 2018: 

Tweet: ‘Am considering taking Tesla Private at $420. Funding secured’

His tweet “set off a trading frenzy,” and pushed Tesla’s stock price up more than 6 percent, forcing Nasdaq to halt Tesla trading for 90 minutes until the company gave an official response. The company’s stock price hit the intraday high of $387 before closing at $379.57 on the day of the tweet. It's currently trading at 350.43 (As of 7:37 pm GMT, 14th November 2019)

 The US Securities and Exchange Commission (SEC) sued Mr. Musk after his tweet. The SEC later claimed that the tweet was “false and misleading.” 

Outcome: Mr. Musk was directed to step down as chairman. Paid a fine of 40 million. Appointed 2 independent directors; Was directed to get his tweets reviewed before posting.

As the public face of Tesla, Musk had gained legions of fans for his bold approach to business and technology, and it can be expected that he is going to be around Tesla for many years to come. This is in the interest of the company also. In the recent Bloomberg survey, a question was asked to around 5000 Tesla owners. 

Question: Did the opinion of Elon Musk influence purchases? 55.4 percent responded affirmative (30.8 percent- strongly agree, 24.6% agree). 

3. Apple:

David Heinemeier Hansson (partner at Basecamp, a web-based software development firm on 07 November 2019 

Tweet:  “The @Applecard is such a f*****g sexist program. My wife and I filed joint tax returns, live in a community- property state, and have been married for a long time. Yet Apple’s black box algorithm thinks I deserve 20x the credit card limit she does. No appeal work.”

Steve Wozniak, too, responded on the same affirming that he and his wife also had experienced something similar. The tweet garnered much attention

 The apple credit card launched in partnership with Goldman Sachs earlier this year uses an algorithm to assign credit limits, and many online pointed out that it may favor men over women. The issue has been taken into, and has led to an investigation from New York’s Department of Financial Services over the issue of gender discrimination.  

An interesting thing happened when I was reading about Mr. David. He is a Le Mans Class-winning racing driver. And co-incidentally I  happen to be at Le Mans circuit currently as I am posting this on my blog. 

Mr. David can be reached @dhh on Twitter and is unavailable at other social media platforms. 


a. The viewership data quoted are subject to  much of deviation depending on the methodology adopted and source choose. I have tried to get a median number for higher degree of accuracy. 

b. Mr David in his tweet had used the full 'f' work instead of using * symbols









NOVEMBER 11 2019

The Curious Case of Apple, Twitter and Joseph Tieffenthaler

Apple has regained the title of the ‘World’s Most Valuable Listed Company’. The surge in the stock from $157.92 to $260.14 makes up of $ 398 Billion dollars in value, year to date in 2019 and that’s like the entire market cap of JP Morgan Chase & Co (408.93 Bn to be precise as of 7:28 PM, (GMT) November 10, 2019)

Their services arm has brought $46 Billion of revenue YTD, and they do understand that services are less cyclical, pregnant with higher margins. Products can’t keep the match of services. The replacement cycle has slowed down because the prices of smartphones have exceeded. They are on par with some of the good laptops in the market. People are waiting for 5G update. And the reasons may just pile up. 

Their sincere attention for services domain may be exhibited by this timeline:

August 2019: Apple Card - The cashback (3-2-1) Model, wide acceptance of the payment mode across US Retail stores, and the embedded safety features have really been appreciated. The mode doesn’t share the actual credit card number to the retailer, but it shares a device number generated specific to your iPhone device.

September 2019: Arcade - Video game subscription service

November 2019: Apple TV Plus - It is an over-the-top ad-free subscription video-on-demand web television service. Their move of letting apple device owners (purchased after Sept 10: The very concise terms and condition may be read here:

) use the service free for a year is definitely going to entice users to continue watching, and for some to eventually pay for a subscription, as new series are released. Though made on a whopping budget of $ 300 Million, Jennifer Aniston, Reese Witherspoon, and Steve Carell starrer ‘The Morning Show’ received mixed to negative reviews. 

Their recent iPhone launch, Tim Cook announcing that the iPhone 11 is the best-selling iPhone of all time, the launch of new air pods are a few of the other stuffs that we have not covered here. But there is a nice video which clearly explains as if what makes 

“Perfect, well-built Apple Product.” 

What’s meant by that? 

Now, this is something I would really encourage you to watch. This is a video review from Dave Lee. What is the core competency of wireless earphones? Sound & Noise cancellation. Sony wf 1000XM3 is better in both of terms to Apple Airpods Pro. But in the end, Dave calls the pro as a better product. This sums up the real tangible aspect of user experience, and I hope that the video serves the intention. 



After a series of tweets in which Jack Dorsey banned the political advertisement, it put Facebook on the back foot. The reason behind so was the stand that Facebook had earlier taken and expressed openly about Political Advertisements. Now it’s not the matter of revenue as Twitter draws only 0.8 percent from this particular type of advertisement while Facebook mentioned that $ 3 million dollars are their share in this. The timings are also crucial because Twitter expressed the same almost as close to Facebook, announcing their Quarter Earning reports. Twitter even took a dig at Mark in one of his following tweets banning political advertisement. He didn’t take name but made statements in the quote : 

For instance, it‘s not credible for us to say: “We’re working hard to stop people from gaming our systems to spread misleading info, but if someone pays us to target and force people to see their political ad…well...they can say whatever they want! 😉”

Though Facebook had a strong third-quarter earnings report. The report may be accessed here:

The legal case that made India skip her breath

Mr. Tieffenthaler: According to the wiki, Joseph Tiefenthaler (or Tieffenthaler or Tieffentaller) (27 August 1710 – 5 July 1785) was a Jesuit missionary and one of the earliest European geographers to write about India. His accounts became one of the decisive evidence for one of the most important legal battles of Indian History. We all know the results and outcome of this case, but here are 13 major points that one should know:

1. The five-judge Supreme Court bench led by Chief Justice Ranjan Gogoi read out a unanimous judgment and ruled in favor of the Ram Janmabhoomi and said there will be Ram Mandir at the disputed site and Muslims will be given an alternate 5-acre land for their mosque.

2. The waqf board argued that the land has been with a certain community for a long time, and based on ‘Doctrine of Adverse Possession’, it should be granted to them. But it was dismissed, stating that the possession was never uninterrupted or undisputed. 

3. The Court agreed based on evidence provided by ASI that Babri Masjid was not made on vacant land but on a structure that is of non-Islamic nature. Though, if that structure was destroyed or demolished to make way for Masjid has not been discussed or talked about at any point. 

4. The court didn’t go much into Righteousness Science / Dharma- Shashtra, unlike the Triple Talaq case. 

5. The court considered Lord Ram as a juristic person and dismissed the point if the birthplace can also be a juristic person. You may read it here for further details:

6. Second longest proceedings in history (40 days in total from August 6- October 16). The longest proceedings were of 68 days in the landmark Keshvanand Bharti Case. 

7. The traveler's account of Father Joseph Tieffenthaler and Montgomery Martin gave detailed accounts of “faith and belief of the Hindus”. Those were taken into account. 

8. Nirmohi Akhara claims were rejected as their suit was outside the prescribed period of limitation and is barred.

9. The temple destroyed dates back to the reign of Vikramaditya.

10. Extraordinary powers under Article 142 were exercised. The demand for 5 acres of land was not even asked. If there are similar cases of title suit, shall the court exercise it again to award the other party? The answer is perhaps No. A similar action was taken because of the extraordinary backdrop of the case. 

11. The land was not given to any organization or any party but Lord Rama himself, and he was considered as a juristic person. 

12. A similar kind of suggestion was suggested in the report drafted by the mediation team, too and a certain section believed that their report may have been taken into consideration while delivering the judgment. 

13. The surplus 67 acres of the land hold by the Central Government have been released, which would mean that the development would take place in almost 70 acres of land for the temple.

Few other points:

Things to know: "doctrine of adverse possession", under which a person who is not the original owner becomes the owner because of the fact that he has been in possession of the property for a minimum of 12-years, within which the real owner did not seek legal recourse to oust him. 

Now, these are few comments that were made in the press conference of All India Muslim Personal Law Board. Mr. Zafaryab Jilani was addressing the conference for most of the part, and then he defended his argument of going for a review petition in the following words: 

“There are a dozen cases in which the Supreme Court has reviewed their judgments. We will never say or do Anything that will fall upon the dignity of the court.  We always have paid respect to the judgments and we have faith in the institution. To disagree with the same is our right. It has been the right of the nation” 

In the press conference, a lady asked this question

Zilani Sahab, You are Indian first and then a Muslim. Why you all are pressing so much for a masjid that has been constructed by Babur knowing that Babur was an invader. 

Mr. Zilani responds to that as:

1. Once Mosque is created, it does belong to God, and we have nothing to do with Babur

2. Is one has so much problem with the name of Babur, we even mentioned that the mosque can be named after Lord Rama

3. There is already a mosque in Lucknow called Shivalaya Masjid. 

The final Supreme Court report may be read here: