Sucheta Dalal :Demise of DotEx?
Sucheta Dalal

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Demise of DotEx?  

Feb 29, 2004

Demise of DotEx?

(February 29,2004)

By Sucheta Dalal

In May 2000, the National Stock Exchange (NSE) through a joint venture between its technology arm, NSE.IT and I-Flex Solutions launched DotEx International, to start an e-trading portal call DotEx Plaza that provided anytime, anywhere equity trading facilities. But in December 2003, when the bull run was at its peak, DotEx shut down for ‘technical reasons’ and hasn’t reopened. DotEx has always been a bit of a damp squib from the NSE stable and did not manage to attract too many brokers. Part of the reason, say brokers, was its high deposit and transaction costs. But those who believed in the product and paid for it say that the secondary market revival was just beginning to attract clients to the DotEx platform, when it was closed down. Interestingly, the NSE top brass insists that DotEx’s shutdown is temporary and that an all out effort is on to fix technology issues. “A decision on the future of DotEx hasn’t yet been taken”, is the NSE’s official line. But angry brokers say that DotEx never really made an effort to understand their needs and price the service economically. In fact, most of them have still to breakeven on their investment in acquiring a DotEx membership.

Seeking compensation

Even as the Naresh Chandra and Kelkar Committee hammers out a plan for the revival of Enron’s controversial Dabhol Power Company in Maharashtra, its bankers seem to be running out of patience. Three bankers —ABN Amro, ANZ Grindlays and Standard Chartered Bank—are understood to have approached the Export Credit Guarantee Department (ECGD) of the United Kingdom for compensation, and a decision is expected shortly. Meanwhile, anti-Enron activist Pradyumna Kaul says that Dabhol related documents now show that OPic (Overseas Private Investment Corporation), a US risk insurance institution is a 72 per cent owner of DPC’s equity. He says that Opic has probably acquired the stake of the defunct Enron Corporation as well as those of General Electric and Bechtel in DPC and increased its negotiating position in the revival process to force Indian institutions to take on a greater share of the write-offs.

Maharashtra Shining

The Maharashtra government probably thinks that announcing mega infrastructure projects will generate a ‘feel good’ effect for it before the polls. Last week, it gave away the prestigious Mumbai-Pune Expressway to a private contractor to maintain and bundled it with a contract to four-lane the National Highway 4, along with the right to toll that road too. The impact and feasibility of this move will only be known in a couple of years. Meanwhile, the Maharashtra State Road Development Corporation (MSRDC) has invited bids for a 22.5 km trans-harbour bridge connecting South Mumbai to Navi Mumbai at a cost of Rs 1,800 crore. Interestingly, just a few weeks ago MSRDC’s managing director Anil Lakhina had aggressively told us that he will simply not speak about the other trans-harbour link (Worli to Bandra) that is literally stranded in the sea with just seven per cent of the project having been completed. He was still confident that banks and financial institutions were eager to finance MSRDC’s other projects. Clearly, the Indian financial sector has not learnt much from another unresolved infrastructure misadventure in Maharashtra called the Dabhol Power Company. Incidentally, the MSRDC advertisement for the Sewree-Nhava link says nothing about its funding or financial viability calculations. Since MSRDC is offering a turnkey contract, a toll on vehicles using the bridge seems inevitable; but it is unclear if this can adequately finance the project, or whether the cash-strapped Maharashtra exchequer will provide money and financial guarantees. Those details may probably be worked out after the elections.

Awards glut

Why would the most profit-oriented media group suddenly criticise its own popular film awards? That too with a bylined article by its marketing honcho, calling the function boring? “It is all about the money, honey”, said a wag. We now have at least seven film awards hosted by Screen, Zee, Sansui, Videocon, Filmfare, Indian International Film Awards (IIFA) and Stardust. Each has a tie up for television, are all handled by competent event managers, hand out indistinguishable statuettes to the same set of films and actors within a space of two months and even seem to have the same gang of stars and industrialists as their first row audience. Naturally, viewers, sponsors and advertisers are all suffering from award fatigue and it doesn’t matter whether the awards are the oldest or the newest in the business. There is also the fact that extensive, and even excessive coverage of Bollywood events by television networks is making the ‘stars’ lose their exclusivity. Now that the leader of glamorous skin shows has declared that award functions are a bore, will it find a way to break the monotony and make more money?

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-- Sucheta Dalal