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Monday,
July 22, 2002, Chandigarh, India  
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PCs penetrate grassroots level
Ethnic wears exhibition
‘Customer satisfaction key to success’ |
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Remuneration in $
Ranbaxy a good long-term bet
Consumers must assert themselves on CAS
Erroneous IRDA verdict
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PCs penetrate grassroots level Within a family, PCs or personal computers are getting as personal as they can. The enigma surrounding them has vanished and these multi-purpose machines are invading the middle and upper class homes like never before. Domestic budget, Net surfing, homework, office work. For a family, it is as indispensable as the housemaid. PCs are reaching the grassroots level if one is to believe what the Manufacturers’ Association of IT (MAIT) says. The PC purchases in the top four metros declined by 26 per cent last year. Similarly PC purchase in the next four metros declined by 35 per cent during the same period. However, in other smaller towns, PC purchases increased by 106 per cent. Vinnie Mehta, Executive Director, MAIT, says that though the slowdown in IT market is of immense concern to the industry yet the increased sales in smaller towns and cities bring a ray of hope. “There is an increased need to support this market and grow it further,” he adds while commenting on the negative growth of 11 per cent (Desktop PC market grossed just 16.7 lakh units the last financial year). “Assembled machines are the best. They incorporate the latest and since these days the assemblers unpack the original components in front of the customers’ eyes, where is the scope for fraud? Everything that is original is used. Then there is this mindset of purchasing from a known face so as to ensure proper after-sales service,” Rajeev Walia, one of the assembler, says. IDC (India) in a very recent survey concluded that no one configuration has the liking of more than 16 per cent of the owners. This diffused liking shows that PC owners’ requirements vary from person to person. The survey found that in the market dominated by the assembled PCs, brands do not have unique or distinguishing traits. In spite of the fact that the PC market is ‘price sensitive,’ there is not a single brand that is perceived to provide value for money, thereby indicating that the brand marketeers have not been able to justify the price differential between the branded and the assembled PCs to the customers. “IBM hiked the prices of its machines by Rs 2,500 a few months ago because of the price rise in RAM. This has affected the home-user segment but not the corporate segment as we provide warranty and all software are legal. In fact, the total cost over three years works out to be cheaper for a branded PC,” Sandeep Singh from IBM says. Voicing similar opinion Yashpal from HP says that the legal version of Microsoft XP alone, which they load on a new PC, costs Rs 6,500. “Therefore, there is such a huge price differential between an assembled and a branded machine,” he says. Assembled PCs are less expensive than the branded ones. But that does not mean that they are in anyway inferior. What’s a branded PC? Even they are assembled machines. Just that here the 12 major components are put together by the MNCs and the components are not purchased from the grey market (that is each component is properly billed and accounted for). The local assembler always responds faster than a branded PC manufacturer. Local assemblers are experts at providing personalised services and quickly sense the latest change in technology. They fix the latest hardware that hits the market to offer top-of-the-line machines. PCQuest, in one of its survey concludes that assembled PCs score higher in service levels. Branded PCs are further sub-divided into the Indian (Vintron, Zenith etc.) and the MNC (IBM, Compaq, HP etc) categories. Branded PCs are worth the money spent for organisational buying. This holds true for a person on frequent postings. Only a multinational brand can cater to after-sales service at all possible places across the country. Then with the price of PCs touching nearly half-a-lakh most of the persons opt for finance options. Here too, a branded PC scores over an assembled ones as the former is financed easily by almost all banks. “These days you get a loan at zero per cent rate of interest. Add 2 per cent as processing fees. That’s all. So what is the need to go in for assembled machines,” an executive with one of the Compaq dealers says. Assembled and branded both work well. The catch lies in how you use a PC, where you use a PC and with what budget do you move around to buy one. Clearly for a genius the worth lies inside a PC. |
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Ethnic wears exhibition Chandigarh, July 21 Mr Manu Srivastav, MD of the company claimed that the response of customers from the region was very positive and they would provide these traditional wears at all the leading stores in Punjab, Haryana and Chandigarh. He said the company was offering a wide range from exquisite Sherwanis and Jodhpuris, to a complete line of kurtas with long and short jackets, stoles and dhotis.
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‘Customer satisfaction key to success’ After migrating from Pakistan our parents decided to settle down in Ludhiana. And in the long run it proved to be a wonderful decision as the city was vibrant and offered numerous opportunities to people who did not mind hard labour. Initial phase My father Mr Jagdish Sethi started the dhaba with the little money he could manage to bring from Pakistan, outside the Ludhiana Railway station on the famous Cinema Road and named it ‘Friends’. This place is now identified with the food joints only. Friends Dhaba became synonymous with quality food at a reasonable price. To begin with, it was a small business. But as the taste of the good food caught up with Ludhianvis the business increased by leaps and bounds. We also tried to reciprocate the love and confidence people of Ludhiana showered on us. The long queues outside our modest dhaba went to get longer and longer as more and more people preferred to dine with us. We catered to taste While the food industry is said to be a profitable proposition now, it was not always like that. There were not many returns. And the business was not also of the same magnitude as it is today. But slowly and steadily we identified ourselves with the good taste of Ludhianvis. Today anyone can recognise the taste of our food that is certainly different from others and also one of the best. Friends a food brand Encouraged by the phenomenal response we decided to do it slightly on a large scale. While the Friends became the food brand of Ludhiana we thought it better to consolidate our brand strength by setting up a hotel in the same name. Although there is a lot of competition still we opted for it. Particularly in Ludhiana, there has been a considerable rise in the number of hotels that have come up in the city. Although the Friends Regency started functioning only a month ago, still the success has been more than expected. The people have reposed their faith and trust in us and at times it is very difficult to handle the great rush of people. And we do not want to disappoint our valued customers. Some difficulties But it has not been always like that. It required lot of labour and determination. The finances are also a major factor. While it is not difficult to conceive an idea and work on it, but it is not a simple and easy task to complete it. We have been helped by our friends and well wishers, who did not let us down when we needed their help the most. Against the widespread industrial recession, we have a hope. The hope stems from our commitment to quality and customer care. These two factors have been the secret of our great success. Future plans In the future we plan to establish Friends as a food brand and diversify into catering business. Besides in the future other hotels would be setup both inside and outside the city. As told to Naveen S. Garewal |
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R. N. Lakhotia Remuneration in $ Q: I am doing medical transcription work at my home at individual level. I am working for my clients who are in the USA. Actually, I am looking for some advice from you regarding my Income Tax. They are sending money directly to my bank via wire transfer to my ICICI Bank saving account. The money that I receive is in US dollars and then in my account, it is converted to INR. I have been told that income received in US $ is tax free, or just 5per cent tax as service charges. As I am sending the processed work to US, so will it be counted as an export business or what and do I need to have some Import-Export no./licence or anything else like this? I am very confused over all this, as I have to file my full return before July 31. Please let me know regarding the tax on my income and also please let me know what kind of formalities do I need to do as I am getting/sending work from /to the USA. — Sonu Ans: You can claim deduction in respect of profits from export of Computer software, etc. by taking advantage of the provisions of Section 80HHE of the Income-Tax Act, 1961. Remember that the entire money received in US$ is not fully exempt from income-tax. As per the said Section 80HHE, the specified percentage of deduction for the A.Y.2002-2003 is 70 per cent of the profits while for the A.Y. 2003-2004 it is 50 per cent of such profits. Please comply with the necessary formalities as mentioned in the said section to avail the tax benefit including submission of report of audit in Form No. 10CCAG.
IT obligation Q: I am 63 years old Haryana Govt pensioner. My total pension from 3/2001 to 2/2002 is Rs 58969/A. I am associated to a local registered society and draw Rs. 28800 as honorarium during the period 2/2001 to 2/2002. Interest from Bank Rs. 13880/-. My total income comes to Rs. 101649/-A. I have deposited Rs. 12000 in P.P.F. and also paid LIC annual premium of Rs 3420 for my grandson who is minor and his father is also not a tax payer because he works with the private firm which pays very low. I have no other source of income. — Jagdish Kumar, Chandigarh Ans: On the facts stated by you from your pension income you would be eligible to claim standard deduction @ 331/3% of the pension amount. Similarly, if you are receiving honorarium as a salaried employee from the local registered society then you would also be entitled to standard deduction from this amount. However, please ensure whether you are treated as an employee or not by the said society. In respect of PPF contribution of Rs 12,000 you would be entitled to tax rebate @ 20 per cent thereon-Rs 2,400/A. However, no tax rebate would be permissible to you in respect of insurance premium paid for minor grandson.
HIG Flat Q: “ I am paying monthly instalments to Chandigarh Housing Board for having allotted me a HIG Flat under the Self Financing Scheme. Monthly instalment consists of Principal+ interest. I want to know whether the interest component of these monthly instalments paid in a year is permissible for any relief in the Income-tax or not. The house is self occupied”. — G.S. Sandhu, Chandigarh Ans: The interest component of monthly Housing Loan instalment would be eligible for tax deduction u/s 24 in respect of your self occupied house property. This benefit can be granted to you even by your employer by submitting Form No. 12C. |
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Lalit Batra Ranbaxy a good long-term bet The concern over the deficient monsoon and sustained weakness in the US markets due to a series of corporate accounting scams took its toll on the Indian stock market as well. The 30-share Bombay Stock Exchange (BSE) Sensitive Index shed 75.56 points or 2.2 per cent for the week to settle at 3,230.27. The S&P CNX Nifty lost 22.35 points or 2.11 per cent to close at 1,035.90. The delay in the monsoon proved to be a bane for the old economy stocks as selling pressure was witnessed on the stocks of automobiles, steel, consumer durables and non-durables, construction companies, textiles, fertilizers and banking. The selling pressure was due to the general feeling in the market that any delay or deficient monsoon would lead to lower agricultural incomes and hence it would spike the nascent economic recovery. Ranbaxy Ranbaxy Labs for the second quarter ended 30 June, 2002 posted a massive 190 per cent rise in net profit to Rs 138.4 crore as compared to Rs 47.8 crore in the corresponding period last year. The sales increased by 43 per cent to Rs 714 crore from Rs 499.3 crore. Ranbaxy’s US business, which contributed over 90 per cent of its overall incremental sales this year to date (first quarter), continues to record strong growth. The outlook is encouraging, given Ranbaxy’s robust pipeline and extensive distribution reach. Ranbaxy’s growth was driven by dosage export from India, which increased by 140 per cent year-on-year in the quarter. Shipments of generics accounted for most of these revenues. Domestic dosage sales grew by 12 per cent owing to improved sales in the anti-infective segment. Operating margins were up by 1.9 per cent. The company has declared a bonus of 3:5 following its excellent performance. The stock is currently quoting at 22.5 times its earnings and long-term investors can add the scrip to their portfolio. Infotech stocks Following the poor results of Hughes Software and Wipro, which were declared towards the close of the week, and due to sustained weakness in the US market; a weak trend was witnessed in the infotech stocks. Hughes Software Systems (HSSL) was among the worst performers in tech stocks. The scrip lost 11.7 per cent for the week to settle at Rs 182.70. For the quarter ended 30 June 2002, HSSL recorded a massive 76.5 per cent fall in net profit to Rs 4.4 crore as compared to Rs 18.7 crore in the corresponding period last year. Net sales decreased by 25.3 per cent to Rs 47.4 crore. Wipro, for the quarter ended 30 June 2002 recorded a 2.45 per cent fall in net profit to Rs 184.2 crore. The results are below market expectations. Wipro lost close to 5 per cent in the week and closed at Rs 1261. Investors are advised to evaluate the results before logging into the infotech stocks. Coming fortnight The index seems to have resumed its fall and is likely to move down to 3164. The index has a support in the 3150-3160 range and the market could see a bounce from this range. However, a fall below 3150 may see the downward momentum gaining strength and the index could slip to a figure between 3020 and 3040. Its various supports are at 3192, 3176 and 3164. Its resistances are at 3240 and 3280.
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by Pushpa Girimaji Consumers must assert themselves on CAS For once, I find Indian consumers shedding their apathy and becoming assertive. I refer here to the way consumers in different parts of the country are taking on cable operators over the increasing cable subscription charges. This is a very positive and timely development, particularly in view of the amendments to the Cable Television Networks (Regulation) Act that pave the way for the introduction of the Conditional Access System (CAS). Let me first explain what the amendment Bill — now before Parliament — is all about. Basically, it’s purpose is to mandate the installation of the CAS or an addressable system (or an integrated electronic system though which signals of cable television network can be sent) for viewing pay channels. Or to put it simply, it gives consumers the choice of paying much less and watching only free-to-air channels or installing what is known as a set-top box to view pay channels. If implemented properly, the consumers should be able to choose only the channels that she or he would like to watch and pay only for them and not pay for an entire bouquet that is thrust on them. Suppose a consumer watches only 10 free-to-air channels and if the subscription per free-to-air channel is fixed at say Rs 5, then that consumer’s monthly cable bill should come down from the present Rs 250 or so to Rs 50. (As per the amendment Bill, the government will fix the price at which a cable operator will provide free to air channels and notify it from time to time). Those who prefer pay channels will of course have to pay more per (pay) channel and also install a set-top box. The simplest of such boxes is supposed to cost around Rs 4000. Of course, if very few consumers are willing to invest in these, then probably the pay channels will be forced to install them free of cost or at a highly subsidised rate. Or who knows, pay channels may even become free-to-air, as their advertisement revenue depends on the viewership. However, all this is guess work. What eventually happens and whether the CAS ensures a fair deal to the consumer in terms of choice, quality and price, depends on two factors: how it is implemented and how assertive consumers are in ensuring that their rights are protected. It is for this reason that consumers and residents’ welfare associations should take active interest in the implementation of the CAS and ensure that subscription costs are worked out in a transparent and fair manner and the consumer retains the right to choose. It is equally important to demand that the government first establish an independent regulator and let the regulator enforce the CAS in a manner that will ensure that consumer interests are protected. Introduction of a new technology like the CAS requires careful planning based on consumer surveys, consumer preferences and an even more careful execution and monitoring, keeping in mind the interests of consumers. It is, therefore, best left to a regulator. I would also expect many disputes between cable operators and consumers during the implementation of the CAS. There could, for example, be complaints of cable operators forcing consumers in a particular area to opt for the set-top box. Or there could be disputes over the quality of transmission or the choice of channels or even the quality of the set-top box or its servicing. I would also expect disputes over costing of the service. Consumers should therefore also demand the appointment of an independent ombudsmen to resolve such grievances. I must also mention here that many disputes between consumers and cable operators before the consumer courts pertain to poor quality of service, unfair trade practices and monopolistic practices. Unfortunately, neither the Cable Television Networks (Regulation) Act, 1995, nor the amendment Bill talks of the quality of service that ought to be provided to consumers or sets performance standards for cable operators. This is also a big lacuna that needs to be corrected. Consumers should also note that the amendment Bill vests with the government, and not the consumer, the power to decide which channels and how many channels would constitute a package of channels forming the basic tier of free-to-air channels. In other words, the Bill curtails the consumers’ freedom of choice and this is unacceptable. Neither the government nor the cable operator should decide what the consumer should see and how many or which channels should constitute a package of basic tier channels. That choice should rest solely with the consumer. If the CAS is all about giving consumers choice, then it should be left to consumers to decide how many channels they would watch and pay for. Otherwise the entire exercise would go against consumer interest. Similarly, even in respect of pay channels, the choice of channels and their number should rest entirely with the consumer and not the cable operator or the broadcaster. Consumers should, therefore, demand appropriate changes in the Bill to ensure all this. Today, the message that should go out from consumers is that unless consumer interest is supreme, the transition to the CAS would not be welcome. |
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Erroneous IRDA verdict With the entry of private Insurance companies, it was the general belief that common man will get better service at competitive rates but the facts had proved contrary to the truth and reality, as all the recently entered private companies in the field, have tie-up with multi-nationals manufacturers and distributors etc. and getting bulk premium at low cost, depriving the four arms of GIC of handsome premium. It is true that four arms of GIC are facing losses ,especially in Motor Department. It is the lame excuse that higher MACT awards result higher cost of the branches, at the same time Government, is handicapped and unable to reatrench the staff or reduce handsome salaries and fat perks, already provided to the staff and as such find it difficult to reduce cost of the branch, while their respective Head Offices expect profits. By declining third party business and other risks of older model vehicles, all the four arms of GIC, which have been made free and at liberty to book business at their own terms and whims thought bound to abide by the regulations of IRDA have started absorbing and squeezing owners of old model vehicles, by clearly declining third party business and to book third party business at their own terms, i.e. recover loading charges, not appropriate to the norms of IRDA, under one pretext or the other. T. P. insurance being mandatory under M.V. Act, vehicle owner is helpless and to abide by the dictates of the insure. As due commission on above business has been discontinued by the companies under current norms of IRDA, genuine insurance workers have been discouraged to work hard to secure T.P. business and at the same time malafide agents and their touts with low integrity. It had been the endeavour of the Government enforcement agencies to unearth black money and it is happening in broad-day light, Government is fully aware and in knowledge of the fact that the worker must be given due return of the work and labour done, whether optional or compulsory, e.g. due commission, though nominal be provided by the authorities as in collection of small saving schemes, NSC and PPF etc. The IRDA should have increased a bit more premium and or reduce commission payable to agents and not provide the opportunity to conceal the Income from I.T. Deptt. Goodmarks man may miss, but it is not too late to re-consider on the subject, should strictly direct all concerned, not to declin e T.P. business and to allow nominal commission to genuine workers in the trade. — K. R. WATTS, Sri Ganganagar |
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Inflation down SBP branch SBI |
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Working on a PC is easy. Purchasing one is confounding though. The buyer has to tabulate various parameters. Machine configuration, peripherals, assembled vs. branded, components. All these factors may perplex a buyer.
“Handwork coupled with maintaining quality has no alternative. That is what we learnt of our experience. Starting from a small food joint commonly known as a dhaba, we are now well established in the hotel business”, says Mr Naresh Sethi, Managing Director of Friends Regency.