Satyam plans to send staff on sabbatical to trim costs

"Satyam plans to send staff on sabbatical to trim costs" - This is another headline that caught my eye today. They are doing an infosys and want to send employees for social causes and they will make a final decision on this based on the third quarter results. The following is the snippet from the news report

The company is looking at sending its employees on a sabbatical, but will take a final decision depending on the third-quarter results. Satyam has already scaled down its hiring projections for the current fiscal to around 8,000-10,000 compared to 15,000 that it had earlier projected.

“We are looking at various options to reduce costs and sabbatical is one such option. We will be able to shift our employees to take up social activities relating to our own corporate social responsibility programmes. Employees can also look at working with NGOs during the time of sabbatical. But, they will have to compromise on their salary during sabbatical as the pay structure will be lower than what they are currently drawing,” said SV Krishnan, global head (HR), Satyam Computer Services.

Indian IT and BPO has an Union to take up layoffs and long working hours

Here is a story from businessstandard that caught my eye today. I did not know about such a body until today and its heartening to see it take up some of the concerns

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The Indian arm of the Union for Information & Technology Enabled Services (UNITES) is planning to file a public interest litigation (PIL) against the alleged “arbitrary policy’ of many Indian and multinational IT/ITeS firms in India who have, for the past two months, reportedly been enforcing longer working hours that violate the daily eight-hour working mandate of the Indian Factories Act, 1948.

UNITES, the country’s first union in the IT-BPO sector, is affiliated to the Indian National Trade Union Congress (Intuc). It claims to have around 10 per cent of the total IT-BPO workforce of 2 million as members, and said the numbers have been dramatically rising over the last two months on the back of lay-offs in the sector. The union is also part of Union Network International (UNI), which has over 16 million workers in 13 different sectors from 163 countries.

IT firms, on their part, insist that the Act is not being violated since IT workers have to work for 48 hours a week — eight hours daily for six days. However, since most IT firms have a five-day working week, they work longer hours, hence the misconception.

But some IT-BPO employees and UNITES are not buying the story. “The labour law in India allows an eight-hour working day, whereas in most IT companies in India people are involuntarily working for over 12 hours daily,” R Karthik Shekhar, UNITES’ secretary general for India told Business Standard.

He added that the increase of daily working hours from eight to almost 10 hours by Indian and multinational companies officially is “a double standard by the IT firms, who, on the one hand are firing people saying they are not getting enough work, and on the other hand, forcing employees to work more since they are getting more work”.

He said UNITES has requested industry body Nasscom to step in to clarify the stance.

The IT sector in India was once the torchbearer of many best HR practices, including flexi-office hours.

However, the situation has changed on the back of a slowing economy. Global IT services firm Accenture, for instance, is reportedly planning to increase working hours by almost an hour with effect from January 1 next year. Infosys, India’s second-largest IT exporter, too, has asked its employees' to strictly abide by the duty hours that the company has fixed as 9.15 hours a day on all working days. Wipro also has stipulated 9.5 hours working hours a day, and is becoming much stricter in terms of timing.

On condition of anonymity, a team leader working with vCustomer, said: “In call centres people are used to long working hours. During peak season (December-January), they work even 14 hours a day. But now due to the ongoing crisis, expectation levels are very high. Performance is being monitored frequently.”

A software engineer with Satyam Computers, Hyderabad, added: “Earlier we could extend our project deliveries by a day or two. Now the management has mandated to deliver by the deadline otherwise it will be marked on performance sheet. Our performance is being evaluated every week. This was a norm from earlier times, but now the management is taking it seriously.”

An engineer from Orange (which does IT and BPO support for the telecom major), concurred, “Besides the long working hours, cost cutting measures are worrying us, and the company has started ferrying seven people in a cab against five earlier.”

An account manager placed with Barclays in Noida, said “The insecurity level is very high. Quality parameters have been raised and everything is monitored very closely, they are marking us down wherever they can.”

Shekhar alleges that most IT firms do not display a “standing order” (regarding the eight-hour duty), which is certified by the labour department, on a notice board at the entrance of every firm. Instead, they have the order posted on the company’s Intranet.

“I believe stressing on increased input is always a mistake — the industry needs to focus on more productivity and value creation on the output side,” said Ganesh Natarajan, Chairman, Nasscom, when contacted. He, however, did not comment on whether Nasscom would be working on fixing a limit on daily working hours for companies.

“The IT industry in India still follows the best practices it had introduced earlier. But this does not mean employees will work less. If they are being asked to stick to duty hours, this will increase the productivity,” explained Infosys Technologies HR head TV Mohandas Pai.

“Besides,” he added, “they are also being paid well to work hard. These are difficult times and if they don’t work hard then there will not be any industry left in coming days.”

Is TCS the worst affected Indian IT major in the ongoing financial crisis?

Is TCS the worst affected Indian IT major in the ongoing financial crisis? This is a question that came to my mind when the TCS stock was getting hammered on the bourses. I thought so since they are huge and have a larger share of their revenues coming from the Financial Services. This is reflected in the share price already. Today I saw this report that confirmed this view. According to this report TCS is likely to bring down the hikes to 0% by 2010 and it also shows how its competitors are doing in this front

For now, the other IT services majors like Wipro has already announced a 7-8% hike in wages for its offshore employees while for Infosys it has been in the range of 11-13%.

I also heard unconfirmed news about HCL not giving the hikes and, worse, even cutting the salaries. News about lay offs are not good for anyone except for the markets which is a positive since its going to cut down costs and improve profitability.

Infosys had come up with a sabbatical policy yesterday which is innovative. We have to wait and see what measures other IT majors will take to cut costs.

RK

Infosys asks employees to take Sabbatical!! What is the Real Intention?

We are in midst of a huge Financial Crisis, that's clear. And its also clear that the impact is not going to be limited to financial sector, the effect is now being slowly but surely felt on industries that are important to the real economy. Even though we, in India, are not part of the core crisis that started in India we still are greatly affected - markets are being hammered, foreign money is being pulled out of the country, promised investments aren't coming, companies depending on exports are closing down and people losing jobs.

IT sector, which is the horsepower that drove India's growth in 90's and which is still the foreign currency earner, is not left untouched. All top Indian IT companies have a decent portion of their revenues from the US Top Financial Institutions. There is a huge concern that these companies will not be able to deliver the same results in the coming quarters as the spending from affected institutions will be cut down and the projects will be shelved. There is also an opposite point of view that thinks US problems will translate into more revenues since US companies will start pushing more work to India.

We have to wait and see which view comes true in the near future. But, right now, I could see the impact. Its not as bad as the technology bubble but its there. No salary hikes, worse some companies cut the salaries, employee weeding in the name of performance, Satyam used wrong claims that were as old as 1 year to lay down a few, and now Infosys have come up with a policy where the employees can take sabbatical from their work to get involved in philonthropic activities.

I cannot comment on their real intentions. I see it as very innovative way of cutting down costs without actually looking like you are in trouble and also earning the good name in the society for its philonthropic inclience. Ofcourse they can easily use it as a tool to increase efficiency by making some of the non-performers take it. So they are not officially laid off, they can still be happy that they get 50% of their salaries.

But this also raises the question how effective these guys are going to be when they come back after an year - will they be refreshed and raring to go or will they be out of touch and find it difficult to get going? And also what if the conditions are still bad? Can Infosys just take them and put them on bench? And will they really keep on their promise of taking them back?

I see that it can be effective tool to cut costs in the near term by retaining the guys for half of the costs and having the option of getting them as soon as situation improves. You dont have to spend time and money to recruit new resources and train them on Infosys way.

Infy, this is really a smart way of doing things!

Top Indian Stocks To Buy : Buying Axis Bank stock around Rs 475 a good choice to make some money

Axis bank is very close to its support levels at the moment and is a good choice as per me to get into for a quick trade. I put in half of my money around Rs 505 and I will put the other half after a couple to days seeing where the markets go.

Actually I did not think that the Indian Stock Market will be down today due to the low inflation numbers that came in yesterday and also the good showing by the global markets. So I put in a buy at a defensive price. I will wait for 2 days and if the markets tank I will double up the money on Axis. One of the reason why I am confident on this stock is that its in banking which are beneficiaries of lower inflation and this company has had no negative news exposure.

Top Indian Stocks To Buy, Stock Picks : Which companies are attractive now in the Indian Stock Market?

I like few companies that are very attractive for investing/trading on the Indian Stock Market

For investment purposes I like Bartronics (No bad news here), IDFC (I think slowdown in infra lending considered here ) and Suzlon (I think it has been battered enough and all the bad news has been incorporated). I will buy Bartronics at the current levels but will wait for IDFC and Suzlon to fall a little since they have run up quite a bit in the last week or so.

For trading purpose I like banks - Axis and ICICI. This sector again was the most affected and I think only better times are ahead for this sector esp with the falling lending/interest rates. Axis is a definitely a buy at current price but ICICI has to go down to around 350 or less to be a buying stock.

RK

Indian Markets :- Indian Companies that are better choices for investments during this financial crisis

I came across a study on BusinessStandard that listed Indian Companies that are sitting on huge cash reserves with good business growth potential. As is often said companies with cash are expected to do better during turbulent times, like this year, where the financial crisis jolted the world economies. I believe in this saying and I do like some companies among the list from this study and I am certainly looking at putting in some money into these stocks during these times. I am sharing this list on this blog hoping it will be of use to readers.

CASH KINGS
Rs crore	Cash + CE	Ent Value	Cash + CE/ Ent Value (%)	Mkt Cap	Price (Rs)	P/E (x)	P/BV (x)	Dividend Yield (%)
Reliance Power	13,440	23,074	58.2	22,626	94.40	209.8	1.7	-
Sterlite Inds	14,074	21,467	65.6	16,392	231.30	11.6	1.2	1.7
Hind.Zinc	7,695	11,732	65.6	11,732	277.65	3.0	1.0	1.8
Aditya Birla Nuvo	6,718	11,386	59.0	4,739	498.80	18.1	1.3	1.2
MTNL	3,758	3,926	95.7	3,915	62.15	7.4	0.3	6.4
Bajaj Holdings	3,213	3,413	94.2	3,413	337.30	5.9	1.1	5.9
Indiabulls Fin	7,412	13,823	53.6	2,601	102.55	6.9	0.9	8.3
Financial Tech	1,402	2,741	51.2	2,316	504.65	2.2	1.6	4.0
Jai Corp	1,825	2,394	76.2	2,312	129.55	30.0	0.9	0.8
Max India	3,842	6,076	63.2	2,253	101.50	33.8	1.1	-
Edelweiss Cap	1,910	3,653	52.3	2,083	278.00	81.0	1.5	0.7
Engineers India	1,417	1,959	72.3	1,959	348.90	8.0	1.7	3.2
GTL	1,277	2,452	52.1	1,750	185.05	14.6	1.9	1.6
PTC India	1,452	1,094	132.7	1,094	48.10	14.2	0.7	2.1
TV 18 India	883	1,562	56.6	1,015	84.65	24.8	2.1	2.4
Market Price, Price/Book Value (P/BV), Price-to-earnings ratio (PE), Market Capitalisation and Dividend Yield as on October 28, 2008 CE= Cash equivalents (investments minus those in group/associate companies); Mcap=Market capitalisation; Ent Value=Enterprise value (market cap + debt) Source: Capitaline Plus

RK

Top Indian Mutual Funds Comparison - Best of 2008

I have a need to invest some amount into mutual funds this year so was looking at the top rated funds. While doing so I prepared notes that will be useful to me to make a decision and I thought publishing here might people who might be looking for the same. I used the information provided in ValueResearchOnline website and came up with this table. The information may not be 100 % accurate however it should provide you a quick comparison guide.

Fund	Type	Performance	Top Stocks/Sectors	Charges	Manager
DSPML T.I.G.E.R. Reg-G	Average Risk Open End Growth Diversified, SIP available NRIs allowed, Repatriable No swap No reinvestment Launch May 2004	Bad this year, Better on good years Benchmark BSE 100 Return Since Launch - 24.82 Manage > 3000 crs	Large caps, high concentration on energy, Diversified with 60 stocks, Top 10 Holdings are 39.67 %	2.25 % entry, 1 % exit within 180, 0.5% within a year	www.dspmlmutualfund.com Anup Maheshwari Since: Apr - 2008 Mr. Maheshwari holds a BCom Degree and is an MBA from IIM (Lucknow). He joined DSPML in April 2001, prior to which , he was with Chescor as Senior Analyst. He has also worked for IRIS and SCICI as analyst and project officer.
DSPML Top 100 Equity Reg-G	Low Risk Open End Growth Diversified, SIP available NRIs allowed, Repatriable Swap Yes No reinvestment Launch Feb 2003	Good this year Above Average on good years Benchmark BSE 100 Return Since Launch - 35.29 Manage > 1000 crs	High on energy. tech and consumer sectors Top 10 Holdings are 50 %	2.25 % entry, 1 % exit within 180, 0.5% within a year	Apoorva Shah Since: Apr - 2006 Mr. Shah is a Commerce Graduate and PGDM from IIM, Ahmedabad. Prior to joining DSPML AMC, he has worked with GPC India as Portfolio Advisor & Head of Products and with DSP Merrill Lynch.
DWS Alpha Equity-G	Low Risk Open End Blend Diversified, SIP available NRIs allowed, Repatriable Swap Yes No reinvestment Launch Jan 2003	Good this year Above Average on good years Benchmark S&P CNX Nifty Return Since Launch - 30.25 Manage > 159 crs	Very High on energy. tech and consumer sectors Top 10 Holdings are 50.55 %	2.25 % entry, 1 % exit within 180, 0.5% within a year	www.dws-india.com Aniket Inamdar Since: Jun - 2007 Mr. Inamdar is an Engineer, and holds a PGDM, from IIM, Ahmedabad. He joined Deutsche Asset Management Pvt. Ltd. in May 2007.Prior to this, he was with ICICI Prudential AMC for 3 years and has also worked with DBS Cholamandalam AMC and UTI AMC.
DWS Investment Opportunity-G	Average Risk Open End Blend Diversified, SIP available NRIs allowed, Repatriable No Swap No reinvestment Launch Jan 2004	Bad this year Average on good years (only one) Benchmark BSE 200 Return Since Launch - 17.64 Manage > 161 crs	Very High on energy. tech and consumer sectors Top 10 Holdings are 39.37 %	2.25 % entry, 1 % exit within 180, 0.5% within a year	Aniket Inamdar Since: Jun - 2007 Mr. Inamdar is an Engineer, and holds a PGDM, from IIM, Ahmedabad. He joined Deutsche Asset Management Pvt. Ltd. in May 2007.Prior to this, he was with ICICI Prudential AMC for 3 years and has also worked with DBS Cholamandalam AMC and UTI AMC.
ICICI Pru Infrastructure-G	Average Risk Open End Growth Diversified, SIP available NRIs allowed, Repatriable No Swap No reinvestment Launch Aug 2005	Not bad this year High on good years (only one) Benchmark S&P CNX Nifty Return Since Launch - 20.49 Manage > 3500 crs	High on energy. Metals, Diversified Top 10 Holdings are 53 % More Debt portion currently	2.25 % entry, 1 % exit within 180, 0.5% within a year	www.icicipruamc.com Sankaran Naren Since: Oct - 2005 Mr. Naren is a B.Tech from IIT, Madras and holds a PGDM from IIM Calcutta. Prior to joining Pru ICICI AMC, he has worked with Refco Sify Securities, HDFC Securities and Yoha Securities. Mrinal Singh Since: Aug - 2008 Mr. Singh is Bachelor of Engineering (Mechanical) and PGDM from SPJIMR, Mumbai. He has over 6 yrs. of experience of which 3 months in equity market.
Kotak Opportunities-G	Average Risk Open End Growth Diversified, SIP available NRIs allowed, Repatriable No Swap No reinvestment Launch Aug 2004	Bad this year Above Ave on good years (only one) Benchmark S&P CNX 500 Return Since Launch - 23.46 Manage > 756 crs	High on Financial Services. Technology, Energy Top 10 Holdings are 38.05 %	2.25 % entry, 1 % exit within a year	www.kotakmutual.com Anurag Jain Since: Jul - 2007 Mr.Jain is a Chemical Engineer and holds a Diploma in Management from IIM Kolkata. Joined the equity markets in 2001 working with SBI Mutual Fund, ICICI Bank followed with SSKI securities. He joined the AMC in August 2005, as a part of the equity fund management team for evaluating investment opportunities in equities. Krishna Sanghvi Since: Jul - 2007 Mr.Sanghvi is a Commerce Graduate, pursued Cost & Work Account from ICWAI, Master of Management Studies (Finance) from NMIMS, Mumbai and CFA from ICFAI. Has an experience in Credit Appraisal & Credit Risk Management. Prior to joining Kotak AMC, had worked with Kotak Mahindra Primus Ltd., Kotak Mahindra Finance Ltd. & Kotak Mahindra Old Mutual Life Insurance Ltd. He has also worked with IDBI for nearly 2 yrs.
Magnum COMMA-G	Above Average Risk Open End Blend Diversified, SIP available NRIs allowed, Repatriable No Swap No reinvestment Launch Jul 2005	Bad this year Average on good years (only one) Benchmark BSE 200 Return Since Launch - 9.28 Manage > 508 crs	Very High on Energy. Metals, Chemicals since it is for investing in commodities Top 10 Holdings are 55.28 %	2.25 % entry, 1 % exit within 180, 0.5% within a year	www.sbimf.com Sudhanshu Asthana Since: Oct - 2007 Mr.Asthana ia a M.A in Economics from Mumbai University and holds a Diploma in Investment Management from NMIMS Has more than 7 years of experience in the financial services industry. Before being designated as fund manager had worked in same capacity and as Equity Analyst with the Quantum AMC for 1 year, for 5 months was with Quantum Advisors Pvt. Ltd.
Magnum Contra –G	Below Average Risk Open End Blend Diversified, SIP available NRIs allowed, Repatriable Swap Yes No reinvestment Launch Jul 1999	Bad this year High on good years Benchmark BSE 100 Return Since Launch - 24.74 Manage > 2050 crs	High on Energy, Financial Services. Technology, Top 10 Holdings are 32.50 %	2.25 % entry, 1 % exit within 180, 0.5% within a year	Pankaj Gupta Since: May - 2007 Mr. Gupta is a Commerce Graduate and MBA from IIM, Luchnow. Has over 4 yrs. of experience in Mutual Fund, Equity Research and Corporate Banking. He had his previous assignment with ICICI Bank Ltd.
Reliance Regular Savings Equity	Below Average Risk Open End Growtjh - MidCap Diversified, SIP available NRIs allowed, Repatriable No Swap No reinvestment Launch May 2005	Average this year High on good years Benchmark BSE 100 Return Since Launch - 11.53 Manage > 733 crs	Mid Cap oriented High on Energy, Financial Services. Technology, Top 10 Holdings are 32.43 %	2.25 % entry, 1 % exit within a year	www.reliancemutual.com Arpit Malaviya Since: Oct - 2007 Mr.Malaviya is a Commerce Graduate and holds a CA degree. Prior to joining Reliance AMC, he had worked with JM Financial AMC and ICAP India Pvt.Ltd. as fixed income securities dealer and also with Haribhakti & Co. OmPrakash Kuckien Since: Nov - 2007 Mr. Kuckian holds an AICWA degree. He has more than 18 years of experience. Prior to this he was associated with HDFC Securities Ltd, SMIFS Securities Ltd, and Canbank Financial Services.
Sundaram BNP Paribas Select Focus Reg-G	Below Average Risk Open End Growtjh Diversified, SIP available NRIs allowed, Repatriable No Swap No reinvestment Launch Jul 2002	Good this year High on good years Benchmark S&P CNX Nifty Return Since Launch - 32.46 Manage > 916 crs	High on Energy, Financial Services. Technology, Top 10 Holdings are 41.14 % Has about 28% in debt and other instruments currently	2.25 % entry, 1 % exit within a year	www.sundarambnpparibas.in Srividhya Rajesh Since: Jul - 2002 She is an alumnus of BITS Pilani. Prior to joining Sundaram, she has worked for two years in Kotak Mahindra.
Tata Infrastructure-G	Average Risk Open End Growtjh Diversified, SIP available NRIs allowed, Repatriable No Swap No reinvestment Launch Dec 2004	At par this year High on good years Benchmark Sensex Return Since Launch - 23.22 Manage > 2046 crs	Very High on Energy, Financial Services. Basic Engg, Top 10 Holdings are 44.51 %	2.25 % entry, 1 % exit within 180 days	www.tatamutualfund.com M Venugopal Since: Feb - 2005 Mr Venugopal is B.Sc in Mathematics and also holds an MBA degree with specialisation in Finance. From August 1995 to September 1997, gained good understanding of the stock market having worked as dealer at Tata Asset Management Ltd for about two years after which he assumed equity fund management responsibility. Has good exposure to large number of industries and companies having done fundamental research over the years
UTI Infrastructure-G	Average Risk Open End Growtjh Diversified, SIP available NRIs allowed, Repatriable Swap Yes No reinvestment Launch Apr 2004	Bad this year High on good years Benchmark BSE 100 Return Since Launch - 22.75 Manage > 1625 crs	High on Energy,Basic Engg, Diversified, Technology Top 10 Holdings are 43.77 % Hard Core infra fund	2.25 % entry, 1 % exit within 180 days	www.utimf.com Sanjay Ramdas Dongre Since: Nov - 2005 Mr. Dongre holds a B.E. and a post-graduate degree in management from IIM (Kolkata). He joined UTI in 1994.Initially, he was asigned a job of Debt analyst which was acting as a support service for fund management activity. He also worked as Equity Research analyst covering wide range of corporates and industries. Subsequently he worked as