Smart People

Life Insurance Corporation of India (LIC), the largest Indian institutional investor in the equity market, has seen its equity portfolio double from Rs 20,000 crore in March 2003 to Rs 43,000 crore in January.

The institution's bullishness on equity is far from over and R N Bhardwaj, managing director in charge of investments, expects to invest Rs 2,000 crore in the stock markets in the remaining three months of the current fiscal.

With economic factors in place, Bhardwaj hopes to ride the wave of successful IPOs in the markets after playing contrarian so far.

"LIC has been a net seller till date during the year and we would like to make some purchases now. IPOs are a good opportunity for this," adds Bhardwaj.

In fact, equities are still a small percentage of LIC's total assets of Rs 3,20,000 crore which he expects to grow to Rs 3,50,000 crore by the year-end.

He says the institution realised its folly after keeping off the Maruti IPO and would be more aggressive on IPOs going forward.

That apart, he is confident on the markets overall and says that apart from small corrections, the broad direction of the markets is certainly up.

Going forward, the increasing base of the stock markets would be beneficial to LIC because the institution is already heavily invested in blue chips, having bought them in depressed markets at low levels, he says.

Bhardwaj has spent 35 years with LIC. He joined the institution as an assistant administrative officer in 1968, fresh after completing his post graduation from the Delhi School of Economics.

Bhardwaj mostly shuns parties and prefers to unwind at home with his family, with old Hindi film tunes wafting in the background. Bhardwaj was a deft table tennis player during his hostel days.

Investors would be glad to see him apply the coordination and concentration skills of the game to make the most of the bull run.

When Crisil announced its intention to pick a 12.1 per cent strategic stake in The National Commodity Exchange (NCEX), it may have sounded inconsequential given that the quantum of investment was only Rs 2.66 crore.

But the fact that this is another move by Crisil to diversify its revenue base is certainly of consequence for long term investors.

R Ravimohan, managing director and chief executive, says Crisil has already been active in the commodity segment and would be leveraging on the storehouse of information and research at its disposal for NCEX.

Plans in the pipeline include setting up a newswire for commodity traders and developing matrices for risk management in commodities.

Crisil has acquired a London-based gas consulting and publication firm to strengthen its arsenal. The commodities market is close to reaching a critical stage, Ravimohan says, adding that liquidity is sowly seeping in.

Most commodities became freely tradable only recently along with removal of import tariffs and the presence of four commodity exchanges in the country bodes well for the segment.

He expects the growing global linkages of the commodities market to result in many more international and domestic players entering the arena.

During his nine-year stint at Crisil, Ravimohan has seen the institution evolve tremendously and grow 10 times in size.

In fact, Crisil is now the fourth largest rating agency in the world in terms of number of ratings (the number of rated companies in India is second only to the US).

According to Ravimohan, Crisil has evolved from being a 'traffic policeman' for corporates to being an advisor in risk management solutions.

This chemical engineer did his MBA from Jamnalal Bajaj and followed it up with an advanced management course from Harvard.

Work comes first for Ravimohan who begins his day early and spends most of his time interfacing with clients.

He also does a fair amount of reading in his free time on management, business and policies, and peppers it with a liberal dose of fiction.