The Week That Was:

From: Vartaa Editorial Team on Feb 21, 2016

JNU Student Protests, Nationalism, and the Freedom of Speech- Part 2

The episode that started with the arrests of JNU Student president Kanhaiya Kumar and 8 other students on grounds of 'sedition' after they had gathered on campus on the 3rd death anniversary of Parliament attacker Afzal Guru to protest capital punishment and show solidarity with the people of Jammu and Kashmir, has escalated. At Kanhaiya's hearing, a fight broke out and students and journalists attending the hearing were beaten up. Meanwhile the Human Resource Ministry of the government under who's purview higher education falls, issued a diktat that the national flag be 'proudly' flown across all central universities at a prescribed height of 207 ft.

Jat Protests

The 'Jat' community in the North-Indian state of Haryana is demanding reserved quota in educational institutions and government jobs under the 'Other Backward Castes' (OBC) category. Protests in the state turned violent when police opened fire on stick-wielding protesters killing at least one. The death toll has since risen to 10. The government has sent troops to the state to bring the situation under control. Protesters had blocked highways and railway tracks. One group of protesters damaged equipment from the Munak canal which is a major source of water to Delhi causing severe water shortage and forcing the Delhi government to announce school closures on Monday, 22 February. Since Chandigarh-Delhi road traffic was disrupted, travelers were left with little choice but to fly. Airlines cashed in on the opportunity by raising fares 15-20 times with tickets going for anywhere between INR 23,000 to 55,000 ($700) for the less than 1 hour flight. The highest fare for one-way economy class ticket had touched INR 99,000 ($1450) on Sunday evening.

Smartphone for 251 Rupees ($4)?

A company based out of Noida called Ringing Bells, announced that it will be selling the world's cheapest smartphone starting April for an astonishing price of INR 251 or around 4 USD. The company claims to have received 600,000 hits per minute and more than 60 million orders causing its website to crash. It has stopped taking any more orders for 'Phase 1,' orders for which will be delivered in April. Telecom minister Ravi Shankar Prasad has asked the Department of Electronics and IT Secretary to investigate the matter. The ministry wants to investigate if the price is too good to be true since its own estimates show that such phone cannot be manufactured for less than INR 2300.

Ratan Tata's Concern

The reticent Mr. Tata took to Twitter to voice his concerns about incumbent domestic airlines' lobbying efforts to keep the current 5/20 law in place. According to the controversial law, airlines need to fly domestically at least for 5 years and should have a fleet of at least 20 planes before they can fly internationally. SpiceJet chief Ajay Singh hit back by saying Tata's joint ventures Vistara and AirAsia should serve India first before getting access to profitable iternational routes.

Opinions you must read:

  • Read Quartz's take on the freedom of speech debate here.
  • Read a review of the movie Neerja, based on the real-life story of PanAm flight attendant Neerja Bhanot who lost her life saving the lives of passengers, here.
  • The Huffington Post reproduced some of Rabindranath Tagore's thoughts on nationalism, which today very likely may have been branded anti-national, here.

Chart of the Week

Couple weeks ago we saw that the visionary leadership of Ratan Tata has earned investors of the major Tata Group companies handsome returns during the last 10 years of his chairmanship. We compared 6 major Tata companies (check out related chart here) with the BSE 30 (Sensex) and all except Tata Steel performed heads and shoulders above this benchmark index. But how do each of these companies do compared to their direct competitors? Does Mr. Tata's charismatic leadership manifest itself as forcefully when viewed through this lens? Last week we compared Tata Motors to its competitors (see chart here) and found that the Auto company provided a healthy annual return of 21% since 2004 but slightly lagged behind Ashok Leyland (23%) and was neck and neck with Maruti Suzuki. We now compare TCS to its peers.

We have chosen the time window of September 2006 through February 2016 in order to include data for all 4 companies. As you can see in the chart, TCS emerges as the clear frontrunner with a healthy Compounded Annual Growth Rate of 19%, 3% higher than runner up Infosys.

With a market capitalization of over $75 billion, it is India's most valuable company and holds the record for highest quarterly net profit. In 2014, TCS broke into the the top 10 of the largest IT service providers globally. Infosys on the other hand was stuck in low gear for a while; several senior executives quit from 2012 though 2014 and the overall attrition rate at the company was alarming. In 2014, 4 of the original founders offloaded almost $1 billion worth of shares causing the stock to further take a beating. Vishal Sikka's arrival in June 2014 appears to have steadied the ship- attrition is lower, employee morale is high, and company has unveiled a strategy to focus on Automation and Artificial Intelligence. The acquisitive Tech Mahindra too has been doing well and has provided a respectable 14% return. Wipro, founded by the other well-respected technocrat Azim Premji, however does not seem to have fared too well.