The Navhind Times I Monday January 2, 2017 navhindtimes.com @navhindtimes facebook.com/navhindtimes navhindtimes.

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Magazine for
Business &
Consumers vox populi The MF accepts your investment and invests in securities,
and gives you back what it gets from this investment 3
Adhere to time
limit in filing
Mutual funds for the aam investors
By Tensing Rodrigues* fire. I mean it, quite literally. Be-

written version
cause I know people who scared

I
of the risk in MFs have invested in
agree my parting comment for far riskier investment options.
the last year was rather brisk Common sense requires us to
By Adv. Jatin Ramaiya or even brusque, if you may choose the lesser of the two. We
like to call it so. The best option do not know what the return will

T
he Goa State Consumer Disputes Redressal Commission recently for the aam investors, I said, be in the future. But then we do
reiterated that the time prescribed for filing written versions have is to opt for mutual funds (MF) for not know anything about the fu-
to be adhered strictly. In a revision petition filed by Hyundai Mo- wealth creation needs in 2017. ture. Nevertheless into the future
tors, the Commission refused to interfere in an order passed by the Let me make up for it. By now I is only where we can go.
District Forum, disallowing condonation of delay in accepting a written suppose, most of us have at least Let us look at the returns given
version after the expiry of the period of 30 days from service of notice of heard about MFs if not actually by the top ten large cap funds
admission. invested in them. Sometimes we over the last five and ten years.
The Consumer Protection Act says that on admission of complaint, the might have even invested in them So just as we place trust in banks there was no risk you would not The top ten large cap funds have
Consumer Forum has to send the copy of the complaint along with annex- without actually knowing what because of the close supervision earn from MFs what you earn given an average annual return
ures if any and notice of appearance to the opponent against whom the they are, upon the advice of our of RBI we can trust MFs on ac- from bank deposits. The basic fact of about 11 per cent over the last
complaint has been lodged. In the revision petition filed before the State trusted advisors. No problem. But count of supervision by SEBI. Of of all investment is that return is ten years and 14 per cent over
Commission, Hyundai Motors had sought to make out a case that there if we are to make them the princi- course, that does not mean that the reward for risk just as in the the last five years. That is nothing
were genuine reasons mentioned in pal engine of our wealth creation nothing can go wrong with MFs; other spheres of life. Higher the spectacular but definitely bet-
the said application for condonation we definitely need to know them chances of wrong doing are al- return higher is the risk accompa- ter than the seven per cent paid
of delay and that the delay was only a little better. Actually I do not ways there. nying it. by the banks. You may ask, why
of about 47 days beyond the statu- like that term wealth creation as Having said that How much risk are we speak only about the ten year and
tory period of 30 days, which ought it conjures up a rather avaricious we need to be clear talking about? But before five year returns? What about the
to have been image. I feel the term personal fi- about what safe that what do we mean by return over the last three months?
condoned. It was urged on behalf nancial security expresses better means in the context risk? Risk simply means Well, over the last three months
of Hyundai Motors that the order what most us have in mind. For of the MFs because not getting the return these funds have lost about nine
passed by the District Forum was the simple reason that, most of us it is not the same as, that we expect to get per cent, viz Rs 10,000 have been
perverse and liable to be set aside. invest to achieve certain personal what it means in the from an investment. For reduced to Rs 8,100.
However, the bench observed that, financial goals rather than to context of the banks. instance, let us suppose So would I still suggest MFs?
The Forum has relied upon the or- launch on an endless money mak- In case of a bank that when we invested Yes. MF is not an option for a
der dated December 4, 2015 passed ing spree. repayment of the in a MF scheme, we ex- 3-month investment horizon. In
by the Supreme Court in the case of New India Assurance Company v/s Lets now get back to the MFs. deposit and the pay- pected 12 per cent. That that case the bank deposit is the
Hilly Multipurpose Cold Storage Pvt Ltd, wherein it has been held that a Basically these are schemes ment of interest on it is a contrac- is we expected our Rs 10,000 in- only option. MFs are ideally for
maximum time of 45 days is permissible for filing of written version. where investments from a number tual obligation. There is no such vestment to become Rs 11,200 in five years and more. Would you
The Forum has also referred to the order dated March 26, 2016 passed of people are pooled together contractual obligation in the case a year. The risk is that it becomes start a business for just 3-months?
by the National Commission Rudra Build Well Constructions Pvt Ltd, v/s creating a corpus which is then in- of a MF. The MF accepts your in- only Rs 10,600 or remains at Rs You will definitely not be making
Dharampal, wherein the above judgment of the Supreme Court has been vested in some securities. The first vestment and invests in securities, 10,000 only. Or worse still be- profits by then; your profits will
relied upon. important thing to know about and gives you back what it gets comes Rs 7,800 or Rs 6,400. That begin coming in only as your busi-
The section 13 (2) (a) of the Consumer Protection Act, 1986 provides MFs is that they are not schemes from this investment. MF is only a is risk. The investment growing to ness settles down.
that the District Forum, shall if the complaint is admitted by it under sec- launched by some fly-by-night pass through vehicle. Your gain or Rs 12,600 is not risk.
tion 12 relates to goods in respect of which the procedure specified in operators though the pooling fea- loss depends upon what the MFs How much risk? Let us look at
sub-section 1 cannot be followed or if the complaint relates to any ser- ture may give that impression. investment returns. the history. How much have MFs *The author is an investment
vices, refer a copy of such complaint to the OP directing him to give his MFs are very strictly regulated Therefore all investment in MFs returned over the last five or ten consultant. Readers can send
version of the case within a period of 30 days or such extended period by Securities and Exchange Board carries this risk which precisely years? Well history is no guaran- their comments and queries
not exceeding 15 days as may be granted by the District Forum. of India (SEBI). It is for MFs what makes it possible for you to earn tee; it is only a guide. To choose to investment.ideas.shop@
From the above provision of law, it is evident that the written version the RBI is for commercial banks. a higher return from the MFs. If between the frying pan and the gmail.com
has to be filed within 30 days from the date of receipt of the copy of
the complaint or such extended period not exceeding 15 days as may be

Newspapers as food packing material banned

granted by the District Forum.
Therefore, in any case, written Key Indicators Latest
version has to be filed within a
period of 45 days from the date BSE Sensex 26,626.46
of receipt of the copy of the

complaint. Consequently, the
petition filed by the Hyundai
Motors India Ltd, stood rejected.
Rs/ UK Pound
farm produce prices
Vegetables Retail rates at Goa State
U
Nifty 8,185.80
se of newspapers for wrapping, pack- serious health concerns since the ink con- may be contaminated with metallic contami-
Re/ US $ 67.87 ing and serving food is a common tains multiple bioactive materials with known nants, mineral oils and harmful chemicals
practice in India. However, this is a negative health effects. Printing inks may also such as phthalates which can cause digestive
83.47 food safety hazard. Wrapping food contain harmful colours, pigments, binders, problems and also lead to severe toxicity.
in newspapers is an unhealthy practice and additives and preservatives. Besides chemical Older people, teenagers, children and people
the consumption of such food is injurious to contaminants, presence of pathogenic mi- with compromised vital organs and immune
health, even if the food
has been cooked
croorganisms in used newspapers, also pose
potential risks to human health.
systems are at a greater risk of acquiring
cancer-related health complications, if they
hygienically. Newspapers and even paper/card- are exposed to food packed in such material.
Indians board boxes made of recycled paper In view of the above, the Directorate of

Horticulture Corporation Ltd outlets (Rs per kg) are being

slowly
Food and Drugs Administration (FDA) Goa ,
consequent to the communication received
poisoned from the Food Safety and Standards Authority
h
hLadyfinger 34.80 h
hCauliflower (piece) 13.00 due to of India, New Delhi, hereby advised all the
newspa- food business operators, including street
h
hCabbage 8.70 h
hChilly 18.80 per being food vendors, kiosks/fast food outlets,
widely used etc., as well as consumers and the gen-
h
hCluster Beans 26.70 h
hOnion 16.70 as food pack- eral public, that newspapers should not
aging material by be used to wrap, cover and serve food,
h
hFrench Beans 35.00 h
hPotato 15.00 small hotels, vendors or to absorb excess oil from fried food,
and also in homes in lieu of absorbent paper. and should refrain/discourage the use of
h
hCarrot 15.00 h
hTomato 14.50 Foods contaminated by newspaper ink raise newspapers, in this regard, for food items.
*Rate as on Dec 31 2016

investors guide
SECTOR WATCH scrip tip
Underlying fundamentals
Headed for consolidation Low cost producer
solid for 2017 cern about utilization BUY

T
he real estate sector which faced turbulent of the Dahej facility is
times in 2016 is staring at another challeng- negligible. There is also

R T
upee appreciation, firm global cues and ing year ahead following disruption caused by he recent fall in the stock price of this scrip not much of a threat
Target Price
value buying, lifted the equity markets reforms like the Real Estate Regulation Act (RERA) is as an excellent investment opportunity. from new upcoming
` 411
on December 30 the last day of trading and demonetisation. But all this may augur well for Petronet completed its 5mmtpa expansion at LNG terminals. Of the Current Price
for 2016. The key indices, which opened on a the sector in the coming times. Amidst prevailing Dahej at a cost of Rs 20 billion. Any green field future terminals GSPCs ` 366.70
buoyant note edged up to hit their highest lev- uncertainty 2017 may well see real estate firmly LNG terminal of similar capacity would cost Rs 50 Mundra terminal may
els in around two weeks time, and closed with put on the path of transformation and consolida- billion. This makes Dahej the cheapest alterna- be completed in mid- Petronet LNG
gains of around one per cent each. tion. tive to the consumers. As against expanded capac- 2017 and the Ennore
For 2016 as a whole the two key indices The year started on a ity of 15mmtpa, Petronet has got firm usage for terminal is also likely to be completed in 2018.
closed between 1.95 per cent and three per promising note. But much 16.75mmtpa. It already operated at annualized rate There is no progress on the pipeline there too.
cent higher against the expected re- Real Estate of 12.4mmt in the first half of the year. Hence con-  Motilal Oswal
with nearly vival, real estate, especially
a third of weekly residential real estate, faced headwinds in terms of
the gains
market weak demand and muted sales in the backdrop of Signs of recovery recovery currently. VGL
coming on
outlook
large-scale delivery defaults, developer-buyer face- has completed all its BUY
the last few offs, unaffordable prices and high interest rates. restructuring and offers

days of
trading. The
stock market managed to close the last trading
session of the year 2016 in a green zone, on
the back of firm global cues.
For 2017 the initial prognosis is good as
the markets began the new January 2017
near-month derivative series on a positive
note. The market is expected to come out of
bearish sentiments without any lasting damage
and come out in a stronger place. The under-
lying fundamentals will remain solid. The FIIs
who have been net sellers are expected to
make a comeback. Investors must view under-
performance as an opportunity to add to ex-
V
The introduction of RERA, added further confusion aibhav Global Ltd (VGL) is undergoing various same kind of services Target Price
to the prevailing chaos and finally towards the end headwinds in the last two years like restruc- as its competitors but ` 353
of the year, demonetisation badly hit the struggling turing of its back end operations, aggressive at a lower average sell- Current Price
sector, making for a bumpy end. competition from a new player and change in strat- ing price. Its business
` 278
There were many positives in the otherwise dull egy and approach. The company has taken various model is beneficial in
and difficult year. It was a watershed year in that it steps to improve performance including introduc- improving times. The Vaibhav Global Ltd
was a year of reformed, regulated and reoriented tion of budget pay (EMI), return of goods, launch asset light business
realty. Notwithstanding the bumps faced by real of mobile app, etc. Due to intense completion it model is favorable and the company has reached an
estate this year the positive measures have put lost market share to rivals and hence was post- inflection point. The volumes are likely to improve
the sector firmly on the path of long-term sustain- ing decline in volumes. However there are signs of from 2017-18 onwards.  Nirmal Bang
able growth. Though 2017 may well start on a
tepid note due to the massive disruption caused by
demonetisation, yet a tax-friendly budget, coupled BUY
with rationalisation of property prices,lower home Poised for growth in form of term deposits. About 40 per
loan rates and implementation of RERA, GST and cent of the deposits are expected to Target Price

posures. The markets look attractive both from
an equity and fixed income perspective and
are likely to give double-digit returns of 10-15
percent at the index level for 2017.
K
Benami Act, may improve demand and significantly arnataka Bank has collected total stay in the system. The bank expects ` 136
push up sales, paving way for a more organised, Rs 7000 crore post demonetiza- slow down in lending to industries. The Current Price
regulated, reliable and investor- friendly real es- tion of which Rs 1000 crore are cash crunch pain is witnessed in SME ` 112.10
tate. IANS in form of loan credit, Rs 5000 crore and labour oriented industries with
Karnataka Bank
in savings deposits and Rs 1000 crore respect to salaries. Arihant Capital