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Rahat Talreja – <\/strong>Vice President – CSS India<\/p>\n You must have been accused of being a Robber (as in: You robbed me) or Lootera (as in: you looted me) or Fleecer (as in: You fleeced me) or Thieves \/ Thugs (as in : they thugged us or in Hindi: chor hai yeh log) Perception:<\/em><\/strong> Reality:<\/em><\/strong> Perception:<\/em><\/strong> Reality<\/em>:<\/strong>
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\nMore so if you are in the business of airline, malls, multiplex, logistics, high end restaurant, airport shops and cafe\u2019s etc. Let me elaborate.<\/p>\nAirlines<\/h3>\n
\nEvery peak season like Diwali, Christmas etc., you see articles in newspapers on how airlines are \u201clooting\u201d passengers with exorbitant sky high fares. Bombay to Delhi ticket at 25000 which normally is 2500.
\nThen same night, you put on the TV and the TV as always is broken into 6 frames – 5 guests\/panellists and 1 host journalist – all arguing on : Are airlines right in looting innocent passengers with sky high fares?
\nWhat is the regulator doing? DGCA? Airlines Ministry on this loot? NGO view, political party view, customers view all are unanimous: They are looting.
\nJust 1 person would be representing the airlines who would also 75% agree to it that they are looting.
\nThis is perception.<\/p>\n
\nOpen the balance sheet, profit and loss account, sales \/ purchase registers, cost matrix of the airline.
\n95% of the time, every year, they fly passengers: Below cost.
\nReason: no pricing power and uncontrolled competition.
\n95% time they lose money on every ticket.
\n5% time – they have some opportunity to cover up due to demand supply matrix
\nYet, they guzzle the capital invested, have poor balance sheets, and have losses on operations.
\nIn India, all airline promoters are billionaires starting from Govt of India run Air India to Tata\u2019s Vistara to Naresh Goyal\u2019s Jet airways to the 5 star ex. airline Kingfishers billionaire promoter Vijay Mallya to the Wadia\u2019s Go air
\nBecause to become a millionaire, you start as a billionaire. After the so called \u201cloot\u201d
\nThis is reality.<\/p>\nMultiplex and Malls<\/h3>\n
\nHow can they ask 400 bucks for a popcorn,
\n200 bucks for corn and 600 bucks to see this useless movie which is like semi porn (remember I am a poet at heart)
\n150 bucks for the parking? 100 bucks for a bottle of water?
\nOn TV, the argument goes again: where is the regulator? Why allow them to fleece customers?
\nHushed comments: these guys make HUGE money
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\nMost malls shut down eventually. Most multiplex chains get sold or shut down. In India, it\u2019s almost a monopoly with PVR. Space for none but one. But are they making that kind of money you think? The answer is: read their finances, that\u2019s the truth and you will realise how the real estate and municipal taxes are what you pay for and not the popcorn, water, wafers etc.
\nAnd we are not even bringing in parameters like return on investment which are prime to businesses.
\n<\/p>\nLogistics<\/h3>\n