Sucheta Dalal :Financial hotshot Sameer Sain’s future role in Future Capital in doubt
Sucheta Dalal

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Financial hotshot Sameer Sain’s future role in Future Capital in doubt  

February 8, 2010

 As Sameer Sain steps down from Future Capital Holdings (FCH), one more bull-market dream lies shattered. FCH was supposed to be Kishore Biyani’s dream financial vehicle to extract value from footfalls into Pantaloon stores. Instead, he has now decided to split its business into financial services retailing and investment advisory. Sameer Sain, the star he had recruited from Goldman Sachs, has stepped down from his position as chief executive and managing director of the company. He has sold 10 lakh shares recently, reducing his 11.85% stake in the company.

FCH is currently in the process of splitting its retailing and investment advisory between the key promoters, Sameer Sain and Kishore Biyani. Mr Sain has now been appointed as vice-chairman of the company. He will be heading FCH’s investment advisory while distribution of financial services will be looked after by Mr Biyani. FCH is in the process of appointing a new chief executive and managing director.

When Mr Sain joined Future Capital last year, institutional investors pumped in money, banking on his stellar track record. Mr Sain was a managing director with Goldman Sachs and head of the special investments group, co-head of wealth management for Europe, the Middle-East and Africa, and a member of the executive committee of Goldman Sachs Bank Zurich. He was supposed to create a financial powerhouse for Mr Biyani by leveraging the reach and customer base of Pantaloon.

For the quarter ended December 2009, FCH’s sales have fallen by 68% while operating profit is down 45% compared to the corresponding year-ago quarter. Net profit is down 37% at Rs3.94crore.

FCH was supposed to have multiple revenue streams. Apart from selling insurance, consumer loans, credit cards and wealth management services, it is an adviser to various offshore and private equity funds. FCH Ltd was incorporated in October 2005 and started its retail financial services business in June 2007. Taking advantage of the bull market of 2007, it made a public issue in February 2008. The stock listed at Rs909 on 1 February 2008. Now after two years, it is quoting at Rs173, resulting in an 81% erosion in investors’ wealth. FCH manages four funds under its real-estate advisory services. FCH’s retail financial services started in June 2007 with an agreement with Pantaloon Retail India Ltd (PRIL), under which FCH has exclusive right to provide financial products and services at present and future malls, stores and retail outlets in India which are owned, controlled or managed by PRIL and its subsidiaries. FCH’s private equity arm, Indivision India Partners, manages a $425-million fund that focuses on providing growth capital to businesses which benefit from the growth in consumption in the Indian sub-continent.
Ravi Samalad

-- Sucheta Dalal