Wealth is the ability to fully experience life – Henry David Thoreau

The role of money is very important in today’s world.  Majority of the people do not have adequate money at the right time when they require it the most. To hedge this unpredictability, one must learn how to invest smartly. Most of the people invest in the mutual funds but with time there are many other investment products prevailing in the market gaining people’s attention.

The Students of IIT Kanpur were fortunate enough to get a chance to learn about other investment options specifically Exchange Traded funds when DIME IIT Kanpur hosted Mr. Sivananth Ramachandran, Director of Morningstar Indexes under its Corporate Seminar series on 11th August 2018.  Mr. Sivananth is an IIM Lucknow pass out and has over 11 years of experience in the investment industry. He mainly deals in new products development at Morningstar. Mr. Sivananth in his session explained about Exchange-Traded Fund, which is a hybrid investment product. An ETF, or exchange-traded fund, is a marketable security that tracks an index, a commodity, bonds, or a basket of assets like an index fund. Unlike mutual funds, an ETF trades like a common stock on a stock exchange. He discussed the differences between a mutual fund and exchange-traded fund and how the landscape of ETF‘s have evolved from the past. Mr. Sivananth explained in-detail working and stakeholders of mutual funds as well as ETFs.  While explaining the same, he said that the working of ETFs and mutual funds are similar in India, unlike the US. ETFs are more efficient due to in-kind transactions as compared to mutual funds. While talking about tracking error, he said that amount by which the ETF performance lags or exceeds with respect to the underlying benchmark index directs to tracking error. While walking us through the applications of ETFs, he explained long-term as well as short-term applications of ETFs. At last, he spelled out the issues related to ETFs which included specific as well as in broader perspectives.

This session by Mr. Sivananth gave us the overall panorama of the investment industry and which will definitely help us in the future.

Wealth is the ability to fully experience life – Henry David Thoreau

The role of money is very important in today’s world.  Majority of the people do not have adequate money at the right time when they require it the most. To hedge this unpredictability, one must learn how to invest smartly. Most of the people invest in the mutual funds but with time there are many other investment products prevailing in the market gaining people’s attention.The Students of IIT Kanpur were fortunate enough to get a chance to learn about other investment options specifically Exchange Traded funds when DIME IIT Kanpur hosted Mr. Sivananth Ramachandran, Director of Morningstar Indexes under its Corporate Seminar series on 11th August 2018.  Mr. Sivananth is an IIM Lucknow pass out and has over 11 years of experience in the investment industry. He mainly deals in new products development at Morningstar. Mr. Sivananth in his session explained about Exchange-Traded Fund, which is a hybrid investment product. An ETF, or exchange-traded fund, is a marketable security that tracks an index, a commodity, bonds, or a basket of assets like an index fund. Unlike mutual funds, an ETF trades like a common stock on a stock exchange. He discussed the differences between a mutual fund and exchange-traded fund and how the landscape of ETF‘s have evolved from the past. Mr. Sivananth explained in-detail working and stakeholders of mutual funds as well as ETFs.  While explaining the same, he said that the working of ETFs and mutual funds are similar in India, unlike the US. ETFs are more efficient due to in-kind transactions as compared to mutual funds. While talking about tracking error, he said that amount by which the ETF performance lags or exceeds with respect to the underlying benchmark index directs to tracking error. While walking us through the applications of ETFs, he explained long-term as well as short-term applications of ETFs. At last, he spelled out the issues related to ETFs which included specific as well as in broader perspectives.This session by Mr. Sivananth gave us the overall panorama of the investment industry and which will definitely help us in the future.

India has a long history of tolerant secularism. Some recent incidents in India have brought focus on secularism. A Muslim person (Mohammad Akhlaq) was reportedly killed by a frenzied communal mob on the mere allegation that he had consumed cow’s meat. Such incidents are totally unacceptable in India. There have been other cases when consenting adults from different religious communities have been denied the basic human right of loving or marrying each other. Such events have been given a communal colour by vested interests who want to divide the society and earn political mileage. Such incidents prompt us to look back into history. Has India been a communal or a secular country in the past? Is secularism an implant in India?

Secularism in the West versus secularism in India

Even if India was not secular in the western sense; it had imbibed the spirit of secularism in its moral fabric and social life. The West had gone through a different course of history. The West embraced renaissance and enlightenment many centuries ahead of India. Scientific temper entered the ethos of life with scientific inventions and discoveries, Europeans felt more in control of themselves. This led to process of secularisation, which led to a shrinking of the sacred space. Because of secularisation,more and more areas of human life got detached from the influence of religious ideas, religious institutions (like Church) and religious authorities (like priests). So, there was an organic development of a secular state in which, state was strictly divided from religion. India, on the other hand, had a different history. India is proud to have one of the most ancient urban civilizations of the world, i.e., Indus civilization. The archaeological remains of Indus civilization suggest the existence of a priest king, which may imply the fusion of State and religious power. With the second phase of urbanisation by about 6th century BCE, 16 “Mahajanpadas” emerged. Some of them had republican form of government where people directly participated in governance while some other like Magadha were ruled by kings who also claimed divine blessings . So, we are a conjuction of state and religion because the king was also the protector of the religion. With the emergence of Buddhism and Jainism, there was a movement towards deeper understanding of the nature of human existence which was free from the dogmatic prescriptions of the Hindu religious texts like Vedas. Religions like Buddhism and Jainism stressed on humanism and aimed at furthering welfare of all human kind and not of any one sector of community. They spread the universal values of love, compassion and a sense of service towards other sentient beings. The legacy of such tolerant religions built a strong foundation of religious tolerance in India.

India has had a history of tolerant kings starting from Asoka who spread the message of ‘dharma’ (literally means to hold together) to keep people united. The Gupta period saw a golden period of development of intellectual thoughts in the form of art and literature. Even though, the themes or motifs have been taken from Indian mythologies, Indian art and sculpture give a sublime message of universal brotherhood. All the six systems of Indian philosophy promote the spirit of inquiry and reasoning to understand the ultimate truth of life. Even with the advent of Muslim rulers into India, the secular and tolerant nature of the Indian society was not altered much. The Muslim rulers came and assimilated into the Indian culture. This fusion of different cultures created a more rich composite culture. The Bhakti and the Sufi saints played a sterling role in spreading messages of tolerance and love. Sufi saints and their “mazars” were not only revered by Muslims but also by devout Hindus.

If India had been secular in spirit and character, then what is the reason of incidents of religious intolerance and communalism in contemporary India?

The roots of communal feelings were laid during the British rule in India. It was the policy of “divide and rule” by which the colonial powers through various state instruments and administrative processes heightened the feelings of separation between the religious communities in India. Hinduism has been a dynamic synthesis of numerous different Hindi ways of life, which the British combined artificially and made it into a monolithic Hindu religion, through the instruments of Census. In fact, Hinduism by its very nature was accommodative of diverse streams of thought (e.g Vaishnavism, Shaivism etc.) & was syncretic in character. Similarly, the British heightened the feelings of being a separate community among Muslims, whose interests were opposite to that of Hindus. The British steadfastly supported communal politics practised by the Muslim League, the Hindu Mahasabha and many other reactionary forces, which finally led to the unspeakable human tragedy in the form of Partition of India in 1947.

What does secularism mean to us in modern India?

India is a fast growing economy with a huge demographic dividend. The predominantly youthful population of India has rising aspirations of a bright future. Though India has progressed manifold since independence, it is beset with some serious challenges. Because of the colonial past, India faces the challenges of communalism. The nature of competitive politics has aided the spread of divisive communal forces in independent India. The model of secularism that India adopted was unique because it did not ask for complete separation of religion from state but advocated equal treatment of all religious by the state. India adopted the democratic principles of liberty, equality, fraternity and justice-social, economic, political. Such democratic ethos have been the anchors during episodes of communal violence that have erupted in India sporadically. Most often, there have been political reasons behind instigation of communal violence, for e.g., Muza_ arnagar in Utter pradesh was rocked by a series of incidents of communal violence before the 2014 General Elections. The secular nature of the state is sometimes perceived as compromised during incidents of communal violence. The state machinery has to be totally non-partisan and provide complete security of life to all its citizens, regardless of their religion.

Why secularism is important for India?

India is a multiethnic, multicultural, multi-lingual society. If India doesn’t maintain its tolerant culture, then balkanisation of India will be imminent. In order to hold together a diverse nation as India, which is a democracy, there is no alternative but to further nurture and strengthen the principles of secularism, tolerance, empathy and compassion. Communal incidents bring religious disharmony, disturb the course of life of citizens, hurts the economy and drives away investors from the country. India cannot a_ ord to indulge in such inanities of “ghar wapsi”, manufactured notions of “communal hatred” because India has an onerous responsibility of constantly progressing on the path of development to enable the eradication of poverty and malnutrition that affects a considerable section of the population.

Ways to strengthen communal harmony and the ethos of secularism

Greater public awareness and vibrant, impartial civil society participation is a sine qua non for building public opinion against communal hatred. With growing interconnectedness of people, through social media, the educated sections have more responsibility to spread the message of love, compassion and empathy towards all religions. This becomes all the more important when cases of radicalisation of alienated people(especially youth) are on the rise. This requires a proactive counter-radicalisation campaign through multiple channels (like co-opting religious leaders, social media, schools, colleges, civil society organizations like youth clubs etc. in the dissemination of noble ideals of fraternity and communal harmony). If there is a vocal public opinion that denounces communal politics, then political parties will also refrain from stoking the communal embers. A State and an administration with zero tolerance towards communalism is the need of the hour. For this, the prevention of communal violence Act will be significant in fixing responsibility and liability on public officials accused of dereliction of duty during incidents of communal congragration. Institutions like National Integration Council and other institutions for communal harmony must be re-invigorated by the state and participation of civil society and society at large. The role of civil society and the people at large is also critical to the spread of the feelings of religious tolerance and secularism and also keep the state accountable towards its primary duty of protecting the life of its citizens, like Mohammed Akhlaq, who unfortunately become the victims of communal violence that destroys the spirit of secularism. A just and fair state that both does justice and is also seen to have done justice towards the grievances of any its religious communities is the best guarantee for a peaceful and cohesive society.

By: Dhan Singh, Research scholar

I was rejoiced to have a chance to enjoy my stay (during Vacations) at IIT, the place full of opportunities, but at the same time, was feeling envy of my friends who decided to do their internships at their home towns. But as they say, to achieve something you have to leave something, everything has its own pros and cons but believe me it was no bad deal at all.

I was given a profile of business development, and to mention that “profile” is too short a term to describe the horizon of responsibilities you are expected to fulfill in a Start Up. Although luckily I had one of my batch mates as my team member (Team of two). So coordination required to achieve the desired goals in such a short time was not an issue.

Now without pouring in more words I will directly come to first day of the internship.

Oh…. I am sorry there is something before the first day as well – “Day Zero”, Yes we received a call a day before our joining, got a briefing mail about the product and were asked to make a sales presentation by using our MBA Insights. We reached the office next day after working on the task whole night and somehow managed to stand up to the expectations.

At the closing of ‘day one’ when we were thinking about the week long training session beginning from next day (supposedly), came another surprise: next task, “I want you to know the right approach for working in a Start Up, for this you are required to read a book and report after 24 hours” said our mentor and trainer (I will speak more about the person towards my closing lines) 300 pages in one day was not exactly what I was used to, still gave my best and reported back with 1/3 part still remaining. But thankfully our mentor did not expect us to complete it either, and with a loud remark “This internship is not going to be easy” our training session started. We were told we could enjoy the work from home facility on which I started dreaming of the extra activities available because of the time flexibility available (again supposedly).

Happiness to have the freedom of working according to my time disappeared at the pace it came. Soon the task made us forget about the normal concept of 8 hours working schedule and we started working on double shifts to complete our basic training, so that we could start with our final goals. With the tasks flowing rapidly and data being collected in abundance I found how important can a simple tool like “Trello” or “Evernote” become if you know how to use the resources efficiently.

After the completion of our training sessions at Kanpur it was time to know the market sentiments as well as analyze  the difficulties and expectations of our expected customers. For this we decided to observe the market space personally and planned to visit parts of Uttar Pradesh, National Capital Region  (NCR), Punjab and Haryana and further divided the demographics into various market segments to have a holistic view and decide upon the strategies to make our product more valuable for our customers.

Very excited to meet the Directors and Chancellors of various educational institutions, (as the product is developed to improve the education sector of the nation) we prepared the agenda and planned the route map in which we were to cover the prospects of our study.

But we forgot to visualize and involve the most important person in the whole process

Although thankfully the company, being incubated at SIDBI, IIT Kanpur and also being awarded by MHRD, along with our personal skills helped to execute our visits smoothly.

After completing the first phase at Uttar Pradesh the next stop was NCR region and with most of my friends staying at Delhi, I thought it would be a great week and opportunity to enjoy few joyous evenings along with the work. But on the first day itself when; while returning from work, I promised my friends to meet them after a 20 min nap and woke up straight in the next morning with about 15 missed calls on my cell phone, it was clear “This internship is really not easy”. But thankfully I had some great time with my friends on Sunday.

And also, we got a chance to visit our homes, as the last phase included the market study at our hometowns.

With the completion of our visits, we learnt how geographical demographics and other market segmentation can bring in changes to the way your product is perceived and also how expectations of customers may vary in spite of belonging to the same segment of industry. We also learnt how to implement theoretical knowledge to get useful results and at the same times how different the theories can be from the practical situations.

In the summarizing lines, I would like to thank the company for giving us the chance to work with them and providing a great learning platform. I would also like to thank our Guide and Mentor who not only trained us but helped us to overcome the problems we faced and kept us motivated by adroitly using reprimands and appraisals.

By- Manpreet Singh

Carefully pondering over the two cases, it is hard to say if the difference in attitudes of two similarly aged people exists due to difference in personality and evolution in due course of time or the childhood learning which their own parents provided them with.

It is not uncommon of parents to focus entirely on the educational learning of their child and totally ignoring value-based growth. If a fair survey could be conducted on the number of parents who have constantly taught their children to become good persons in life first rather than doctor, engineer, IAS and so on, the results won’t be too surprising. The problem of this situation is in-depth.

Inculcation of values in a person is a long-term process that needs to be started during childhood itself. Children who have been exposed to the core values of humanity not just become good persons but great decision makers as well because of their clarity of thought. The values help in developing respect people should have for one another in society personally and professionally. Children who have been made to understand the core values are not only more co-operative with others but also more active in taking responsibilities and initiatives in life. Value centric person is more mentally sound and carries high moral integrity.

Hence, these value carrying people are not only doing good to themselves but also to the society at large. For instance, since in these days organizations have become more people centric and have been acting as social systems, it has become rather more important for them to have people

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Pallavi Lohia

MBA 2015-17

The most concerning chapter for India during last two years and specifically last two months is the weakening of rupee against dollar. It is not only that rupee has lost its value in the global context but also dollar has improved its performance in the global trading markets. The outstanding performance of US equities and the improvement in the labor market has made Americans more optimistic about the US economy, thereby stimulating greater hopes of QE(Quantitative Easing) tapering.

The government of India is still unable to generate heavy capital inflows.If US Federal Reserve withdraws its bond buying programme; there will be unexpected outward flow of money leaving India clambering for dollars. The slowdown in the Indian economy has made the situation more fickle.

The government has a strong role in controlling currency in the form of policy regulation and reforms. The current UPA leadership has failed to strike with some heavy reform to generate more cash inflows. As a result the government has gradually lost its control over rupee depreciation. Investors’ sentiment plays a pivotal role over here.

Oil and gold imports account for 35 per cent and 11 per cent of India’s trade bill respectively.There has been an uninterrupted demand for the dollar from the oil importers pushing the rupee lower. Likewise the falling gold prices have made the central bank to reduce imports, which increases CAD and hits the currency directly. Indian economy requires a strong structural reform to maintain a positive balance of payment.

Also, government spends excessively as election approaches just to woo electorate votes. This causes the rupee to depreciate. Then the government beats around the bush to control the currency behaviour. Most of the times these measures worsen the economic crisis to a great extent.

The foreign institutional investors have been selling index futures and Indian equity market is weakening. As a result there is a heavy demand for dollar and Indian currency as well as economic situation is looking too gloomy.

These worries, combined with a record high current account deficit and now uncertainty over the central bank’s monetary policy stance, have prompted foreign investors to sell more than $12 billion of Indian debt and equities since late May.

Reserve Bank of India has taken certain steps and some more to be followed to have a control over rupee.
But the big question comes here.

what are the implications?
And is it that bad overall??

The best business prototype anyone can have is to spend in rupees and earn in dollars, which is what the giants of India Inc, including the top IT companies, excel in. Basically the sector which is targeting exports for its industrial operations are the one wins the game.
Dollar appreciation would be positive for sectors such as IT, pharmaceuticals, hotel, textiles and automobiles which have the total foreign exchange earnings of these firms are far greater than their forex spends. As much as the rupee weakens, the foreign exchange earners gain provided the other factors remains constant.

A sharply declining rupee triggers inflation, broaden the current account deficit, hits investor sentiment and creates burdens for organization with high exposure to foreign debt. The government and the Reserve Bank of India have taken several reform initiatives to resist the downturn, but their success stories are looking gloomy.

Buying imported materials will become very costly. A weak rupee will create extra stress on Oil Marketing Companies (OMC) and this will surely be passed on to the consumers as the companies are allowed to do so after the deregulation of petrol and partial deregulation of diesel. If the OMCs increase fuel prices, there will be a substantial increase in overall cost of transportation which will trigger inflation.

If the depreciation is steep and without control, it will strike up inflation. As a result the Central bank would have very less room to impose further rate cut and that’s the burden the borrower would have to bear.

Indians who have gone to abroad for tours or studies are highly affected in these times. The only smiling people in this context are the NRI’s who gain more on sending money to their homeland.

As a whole we can say that though weakening rupee is the reason for someone’s smile it is a real threat for the country’s overall fiscal health and increase the current account deficit heavily. But in my opinion this huge downgrade is a temporary phenomenon and the rupee is really oversold. Now the Central bank and Government should work hand in hand and find out the policy measures to stabilize the frightening scenario. I personally hope a further cut in SLR to ease the liquidity to save rupee and also import duty hike in gold and other related materials. RBI can buy bonds to ease liquidity in the market. Finally we can say that the situation is tight and challenging for us, but we can not only hope for the best but also should contribute the most to get back Indian economy in the driving seat.

Sayantan Ghosh
MBA Batch 2012-14

As the new batch prepares for 2 years of constant duel and learning, the current batch of MBA has just completed their summer internships and is fresh with new industry experience by virtue of improvising their management learning of the first year in real-time organisations.

Lets have a look at the articles covered in this edition:

Carrying forward the discussion on FDI by Mukul Joshi in the previous edition, Shashank Shivhare of 2012-14 batch talks about one of the most debated topics in recent times, FDI in Retail and discusses its impacts on trade deficit and employment.

Chintan Parikh of MBA 2012-14 batch continues his take on AMUL and talks about the role of cooperatives and their entire business model in today’s corporate scenario.

This issue also covers the business quiz 2 and would help you to test and enhance your knowledge of business sector.

Finally, the team of Angshuman, Anil, Vidit and Mangesh of MBA 2012-14 batch shares their observations of the application of different theories of organisational behaviour in a small-scale organisation, JK Industries of Kanpur.

We hope that you like this edition of Avant Garde.

Feel free to post your comments on the articles in the “Add Comment” section. We await your comments, criticism and appreciation.

Till the next issue, wish you a Happy Reading!

Team AG

Come this July 2013 things have changed. NASSCOM organized “Big Data and Analytics Summit 2013”. They created a special interest group and proposed that the future of IT could be analytics. The idea behind creating such group was to create India’s competitiveness as far as analytics is concerned.
(http://www.nasscom.in/bigdata/overview)

Speakers like SrikanthVelamakanni (CEO, Fractal Analytics), Ravi Vijayaraghavan (Chief Scientist, 24/7) and many more threw multiple vantage points across the topic and made us to believe that it is for real and the big data analytics has actually arrived at a bigger stage.

Putting aside all the hype and buzz, my purpose of writing this article has been to throw light on my understanding vis-à-vis Analytics and reasons that have paved the way for it, and why should a company take it seriously. I will also try to think out of box to present some of the possible future offerings.

I believe it is not something new and has been there since Google launched their search engine. The big algorithms that they wrote to crawl down the web to find relevant items matching with the keyword being searched was no less than drilling big and humongous data. Orkut, Facebook gave us an option to be friend again with the person whom we lost contact some 10 years back, wasn’t they were playing with some form of big data?

Analytics is science of examining data (text, quantitative, qualitative, etc.) to bring forth underlying information. This information can give us some undiscovered patterns or can establish hidden relationships, which can shape the decision making capability of an organization. There are two important facets of Analytics: First is practical intuitiveness, there can be hundreds of ways a given data can be analyzed, but the beauty is that none can be completely correct however it will give us some direction. The point is to chase that direction and to keep it updating with the trend. Second is real time, if a Google search engine will take one hour to list down all the possible matches, its enormousness couldn’t have been achieved. All the analysis has to be done on the fly. Company can’t compromise a customer to escape just because they were not able to understand his purpose of visit. Change they say is the need of hour, Flipkart analyzed that if they have to stay in the business they have to expand their horizon from books to all life-style products. They were fast enough to analyze their customers’ purpose of visit.

Companies like Wal-Mart, AT&T, Colgate-Palmolive, Amazon and many more had long access to vast amounts of data in the forms of scanner, serial logs but were mostly unstructured. With the advent of many analyzing Software like Hadoop, SAS, Cognos, Tableau it became easier and faster to analyze it.

Doldrums In global economic condition has barred companies vertical expansion and thus to maintain their operating margin they were forced to shrink their operating cost. That allowed companies an opportunity to think and employ methods which previously were deemed as not so mandatory rather an investment.

With wide range of competition customer retention needs focused approach for almost all companies, losing a single customer is a threat and adding even one is not an easy task. Analytics came as savior that allowed companies to target customers at the right place and at the right time.

Interning twice with Indiatimes Shopping brought me closer with web-analytics and made me ponder the possibilities that an online shopping has to offer in upcoming days. What if I am moving in Pantaloons Men’s shoes section, I am about to buy one and I receive a message from Indiatimes, “The same shoe is being offered with 25% discount, just login here”. A scanner reads the shoe data, my pantaloons card is attached to my mobile and my mobile is attached to Indiatimes. Indiatimes and Pantaloons are doing joint marketing. A win-win situation for everybody that is only possible with the help of analytics.

So, Analytics is now no more a luxury for an organization rather a hygiene factor.

Let us have small look at the current analytics industry of India

• Size of the Indian analytics Market: – 375 Million $
• No. of companies operating in this segment in India – More than 500
• Expected Indian Analytics market by 2015 – 1.15 bn $ as per Business standard report

The charts below give further information about the various types Analytics applications, location of analytics companies in India and classification of analytics industry in various business segments.

So Analytics industry in India is emerging day by day and holds the key importance for the commercial growth of India in the future to come.

References:

(1) http://www.mu-sigma.com/services/services.html
(2) http://analyticsindiamag.com/
(3) www.businessstandard.com

Nishu Navneet
MBA,IIT Kanpur
+91-9651900033
nnishu@iitk.ac.in