T. Venkattram Reddy's lifestyle behind Deccan Chronicle's troubles?

Media baron T. Venkattram Reddy's flamboyant lifestyle, extravagance and aggressive attitude seem to have led to the present crisis of his business empire Deccan Chronicle Holdings Limited (DCHL).

According to company insiders, Reddy loves to flaunt his wealth and lead an ostentatious life. He comes to office in the most expensive cars. His fleet of luxury cars comprises Porsche Cayenne S, Rolls Royce Phantom, BMW, Land Rover, Lamborghini and Mercedes Benz to name a few.

"Reddy wants to buy any new car introduced in the international market," a senior executive in Deccan Chronicle (DC) said.

Apart from his penchant for luxury cars, Reddy lavishly spends on horse racing. He owns a large number of horses that participate in races in various parts of the country winning several trophies.

In fact, he sponsors a trophy in the name of his late father T. Chandrasekhar Reddy, former Congress MP, in the Hyderabad Race Club, Malakpet. The trophies won by him adorn the cupboards of his chamber in the DC head office in Secunderabad.

Senior DC journalists who had worked with Reddy's father and later with him recall that media magnate was a prudent businessman in his early days but had become aggressive in the last 10 years.

"He used to run Nagarjuna Hotel and Annapurna Foils (an aluminum foil manufacturing unit) besides a software bottling plant till 90s. But subsequently, he wound all of them up and concentrated only on Deccan Chronicle, which recorded a steep growth in the last 10 years," a retired DC employee said.

It was only after 2005 that Reddy ventured into aviation, bookstore chain and Indian Premier League (IPL) sectors.

"The entry into IPL brought a lot of change in his attitude. He began imitating liquor baron Vijay Mallya - right from growing long locks of hair to moving with celebrities to traveling in chartered flights. And like Mallya's Kingfisher Airlines, Reddy's DC too has started crumbling," a stock analyst associated closely with DCHL said.

Insiders say Reddy's over-dependence on loyalists was also one of the factors that led to the crisis.

"Reddy does not understand the nuances of stock market. After making it a public limited company, he should have gone cautiously in spending resources since it is basically public money. But he left it to his loyalists to manage the financials and that led to the crisis," sources in DC said.

According to sources, Reddy's long-term associate P K Iyer, who was made vice-chairman of DCHL, had been handling the financials of the company.

"He is the brain behind taking huge loans from financial institutions by pledging shares and assets. Reddy and his brother T. Vinayak Ravi Reddy have been acting on Iyer's advice," sources added.

Inquiries revealed that Iyer had gone underground after Karvy Stock Broking Limited filed a criminal case against Reddy brothers alleging forgery to pledge non-existing shares to Future Group to raise Rs 170 crore last month.

"Only if Iyer surfaces, there would be some solution to the present crisis," sources said.

Due to Iyer's absence, DCHL board meeting could not take place as scheduled on August 14 and the company informed the stock exchange that it was adjourned due to lack of quorum.

The price of DCHL stock continues to plummet reaching the lowest- ever figure of Rs 10.05 on Thursday as against Rs 70 in the same period last year.

Courtesy: Mail Today