 "Raja Vishvanidhi Dalmia")
As one speeds past the Mandi House metro station and the adjacent construction site here, it is not difficult to miss Dalmia House on Sikandra Road. Amid the greenery inside a huge compound is a sprawling, off-white Lutyens-era bungalow.
Paintings by M F Husain line the narrow staircase. “Those are prints. This one is original oil-on-canvas,” says Raja Vishvanidhi Dalmia, pointing to a canvas that has a pride of place in the massive, high-roofed hall, a rarity these days. “I had a friend whose house Husain saab used to visit. I got it through him. It must be worth manifold now.”
The painting is one of the better investments of Dalmia, son of legendary businessman Ramakrishna Dalmia, who once owned an industrial empire that included a bank and a publishing house. The bungalow, bought in 1946, is spread over 2.8 acres. “It takes a lot to maintain this,” he said.
Dalmia’s latest investment, though, has gone bad. He had exposure to National Spot Exchange Ltd (NSEL) sugar contracts. “I was approached by my broker (India Infoline) sometime in the middle of last year. He said the product was 100 per cent safe. He even told me the exchange was 49 per cent owned by Nafed (National Agricultural Cooperative Marketing Federation of India), a body under the Ministry of Agriculture,” said the industrialist with interests in real estate and commodities.
NSEL sugar contracts were available in lots of about Rs 3 lakh. The date of the first contract was May 17, 2012, and the initial investment was Rs 31 lakh. “My objective was parking of funds. Since the broker assured the product was better than fixed deposits and fixed-maturity plans, we kept on adding positions, four, five and six lots at a time,” he said.
By January, he had opened accounts in names of his wife, son and daughter; the combined positions had crossed Rs 5 crore. “We used to put any surplus in this. This is all tax-paid money,” he adds.
Earlier, Dalmia used to invest such funds in property. He said he was involved in realty developments in and around Delhi. Did the downturn in the realty market push him to seek better returns elsewhere? While he agrees deals aren’t being seen even after 10-15 per cent discounts, he says, “I’ve even sold property to put money here; all this, because we were given the impression this exchange was regulated by the government of India, Sebi (Securities and Exchange Board of India) and FMC (Forward Markets Commission).”
Dalmia had no idea of the crisis, even after the government’s July 12 letter that had started hurting NSEL promoter Jignesh Shah’s group stocks. “We kept on rolling over, as we had no clue. Even after the rumours, the broker was assuring us there was no issue. But we heard from some other broker that it was better to take out the money.”
He managed to get some cheques bounced by giving instructions to his bank; the exchange cancelled trades executed on July 29, 30 and 31. “This way, Rs 5-6 crore of my money was saved. But I still have over Rs 10 crore due from them.”
Dalmia, in his fifties, loves riding and playing golf. A St Stephens College and Faculty of Management Studies alumnus, he also runs trading firm Growell Dalmia India Commodities and is a partner in Mercuria Global, a Swiss firm involved in energy. “But I like the real estate business more,” he says, somewhat hurt by the treatment NSEL investors are getting from different quarters. Turn to Page 15 >
“We are seen as gamblers who have lost their bets.”
Dalmia’s office is working overtime to track down the borrowers and their details and scouting for ways to recover the money.
Dalmia, the Delhi convenor of the NSEL investors’ forum, is busy networking with those affected by the crisis, officials and politicians to get “Jignesh Shah to own up”. Recently, he also met Jagmohan of Mohan India who promised to settle dues if a meeting was arranged with Shah.
“Last week, I even met Agriculture Minister Sharad Pawar and told him this was supposed to be an exchange of farmers and such things should not happen. Pawar said all the guilty would be brought to book,” he says. “He promised to speak to the finance minister and said justice will be done to NSEL investors.”
