Roundup: People who made news last fortnight

The Elephant Trumpets
We have shown the elephant can dance," O.P. Bhatt, former chairman of State Bank of India (SBI), whom Pratip Chaudhuri succeeded, once said. Bhatt was referring to the SBI - whose logo used to be an elephant - improving its market share in loans and advances considerably during his five-year tenure. But there was a flip side, which the Reserve Bank of India (RBI) was quick to point out. Sharp differences arose between Bhatt and RBI senior officials on the issue of teaser home loans, which the SBI then aggressively promoted and the RBI opposed, as well as on the provisioning for them. Such loans are those which carry a fixed interest rate for three years followed by a floating rate. Bhatt retired in March last year without bowing to RBI.

Chaudhuri, a post graduate in statistics from Rajasthan University and a banker for nearly four decades, who succeeded Bhatt in April, took a markedly different view. In less than a fortnight he had withdrawn the teaser loan products. "One cannot be in a state of perpetual conflict with the regulator," he said.

But those who thought Chaudhuri pliant compared to Bhatt were in for a surprise recently when he made the radical suggestion that the cash reserve ratio (CRR), or the need for every bank to deposit a percentage of its deposits with the RBI, should be abolished. "The RBI should either do away with CRR or compensate the banks for the losses incurred as the banking system is not earning any interest on it," he said on the sidelines of a banking conference. (See also Page 24.) A phasing out of CRR would release funds locked up with RBI and could help in reducing interest rates for both retail and corporate borrowers. Currently, CRR - which is set by RBI - is 4.75 per cent.

The comment drew an immediate riposte from K.C. Chakrabarty, Deputy Governor, RBI. "If the SBI Chairman is not able to do business in this regulatory environment, he has to find some other place," he said. Far from being cowed down Chaudhuri returned the fire soon after. "When Chakrabarty was a bank chairman, he was also of the same view on CRR," he said. Fortunately, before the matter could escalate further, RBI Governor D. Subbarao intervened, making a light hearted comment about locking up Chaudhuri and Chakrabarty together in a room till they reached an agreement on CRR, which defused the situation.

But the CRR controversy is unlikely to die out completely. Chaudhuri's comments reflected the banking sector's feelings that CRR was stifling growth. It is likely RBI might meet the banks halfway by cutting CRR by a few basis points soon.

-Anand Adhikari

Expedia-ting Travel
Working with the world's largest online travel company could well turn a person into an avid traveller. But with Vikram Malhi, who runs the India unit of US-based Expedia, no such change was necessary. "I work in this industry because I like to travel," he says. "Every weekend I go somewhere." One of the key attractions of Expedia is the abundance of last-minute deals its website offers, a big draw for the ever increasing number of people who ask themselves on a Thursday what they are going to do two days later. Malhi recently acquired another hobby apart from travelling: running marathons. He has already done four: two in the United States, one in Sweden and one in India. Expedia seems to be running hard as well. Four years after it entered the country, it has announced a research and development centre in Gurgaon, its biggest in the Asia-Pacific, bigger than the one in Beijing.

-Vivan Mehra

Power of Three
Some models of this three-wheeled scooter could cost even more than a motorcycle does, but Pune-based Digen Varma, 27, CEO of Trikke India, the sole Indian distributor for the US brand Trikke, is confident it will find takers here. "It is a fun toy that keeps you fit too," says Varma. Recently launched in India, the vehicle, whose different models cost between Rs 6,000 and Rs 125,000 and come in both manual and electric versions, allows a rider to propel it by leaning his body forward and sideways without putting his foot on the ground to push. "We have 12 dealers now and this will rise to 30 in another month," he adds. In 2002, Time magazine named Trikke as one of the best innovations.

-G. Seetharaman

New Items on Yo! Plate
He may not do much cooking himself, but when it comes to the restaurant business, Ashish Kapur knows the ingredients for a successful growth recipe. Almost a decade after starting Moods Hospitality, which runs the restaurant chain Yo! China, Kapur is venturing into the caf format with Yo! China Cafe. He will start with 10 such cafs, primarily targeted at young people, needing a total investment of Rs 25 crore. These will charge 20 per cent more for their dishes than existing stores. "The definition of a cool Chinese hangout has changed since we started out. From the style of presentation to the choice of dishes, tagline and interiors, everything will be different in our new stores," he says. Most ingredients will be flown in from overseas, while a new expat chef has been hired to ensure consistency and quality. "The Yo! China brand is working well, but we think it is time to reinvent the wheel," says Kapur, who trained as an engineer and once worked with the likes of GE Capital.

-Manu Kaushik

Securing the Future
It is the biggest deal in the Indian private security sector so far, surpassing Blackstone PE's acquisition of Securitrans India for Rs 150 crore last year. Rituraj Sinha, COO of Security and Intelligence Services (India), or SIS, the country's largest private security company, recently raised Rs 500 crore from PE firm CX Partners. Sinha says part of the money will be used to provide an exit route to investment fund DE Shaw, which invested in SIS in 2008. The remaining funds will be used for company growth. SIS has prepared a business plan that will double the company's valuation to more than Rs 5,000 crore in three years. "Guarding is a low-margin business compared to cash management and electronic security services. We are aiming at changing our revenue mix which is highly skewed towards guarding at present," says Sinha, 33, a second-generation entrepreneur who joined the family business back in 2002.

-Manu Kaushik