 "Jayalalithaa")
The most visible and recurring impact former Tamil Nadu chief minister J Jayalalithaa had on Dalal Street was the way her fortunes affected the stock prices of Sun Television Network.
The media giant, promoted by Kalanithi Maran, a close relative of her life-long adversary, DMK chief M Karunanidhi, rose 12 per cent on December 5. This was when everyone, including Karunanidhi, himself in a hospital, was issuing statements praying for her recovery from the cardiac arrest that would eventually prove fatal.
Stocks don’t have emotions or, if so, they haven’t learnt the ways to nuance their expression. A little over six months earlier, the Sun TV stock had crashed when it was clear that Amma was storming back to Fort St George with a truncated but clear majority.
Even after recent gains, the Sun stock is trading much lower than the highs of Rs 530-odd it had hit in December 2010, months before the end of Karunanidhi’s DMK regime in the state. Institutional and public shareholders who bought the stock based on the network’s dominant market position and purely on the business case would be kicking themselves for discounting the Amma factor.
Another Tamil Nadu-based business that did not have a great time during the five and a half year AIADMK regime was of Vasan Healthcare, that ran the Vasan Eye Care hospitals. The new kid on the block had plans for an Initial Public Offer of equity as early as November 2010.
But, it has since got entangled in income tax raids and other investigations, especially after 2014. Last heard were talks of a distress sale in July.
But, it has since got entangled in income tax raids and other investigations, especially after 2014. Last heard were talks of a distress sale in July.
Despite her being known as a business-friendly chief minister in the obituaries, Amma once chose to play to labour union sentiments, throwing a spanner in the Centre disinvestment programme. In 2013, when the latter cleared a plan to divest five per cent in NLC India (formerly Neyveli Lignite Corp), she wrote to the prime minister to stall it. As it became a game of one-upmanship between her and the DMK, which had by then exited the governing alliance at Delhi, Jayalalithaa wrote to the Centre with an offer to buy out a part-stake through state government corporations.
She also seemed to have been briefed in detail about the regulations and provisions related to the securities market. A report dated June 25, 2013, in The Times of India quoted her, “I believe this requires an unconventional and pragmatic solution. Therefore, I propose that the five per cent Government of India holding in the NLC be offered to one or more of the Government of Tamil Nadu’s state public sector undertakings, such as the Tamil Nadu Industrial Development Corporation and the Tamil Nadu Industrial Investment Corporation. Such entities fall within the meaning of the public as defined under Rule 2(D) of the Securities Contracts (regulation) Rules 1957.”
On the Securities and Exchange Board of India (Sebi) rules permitting sale of shares to government undertakings, the then chief minister said, "I find that as Sebi had earlier indicated to NLC that under its guidelines it is possible for the shareholding in NLC to be divested, through an institutional placement programme or through any other method as may be approved by Sebi, on a case by case basis, the mechanism I have proposed can be facilitated by Sebi."
As on many occasions through her life, she had her way. The Centre divested but its Life Insurance Corporation and the State Industries Promotion Corporation of Tamil Nadu bought these shares, defeating the real objectives of the regulator.
Jayalalithaa’s own investments remained largely in the unlisted space and did not have any direct impact on the market. For lack of any direct Amma plays, the Street chose to hoist the Raj TV stock, with no direct links to her, on her election victory.
