27 March 2013

IIPM


In an unprecedented bid to block material critical of controversial business school Indian Institute of Planning and Management (IIPM), the Indian government has ordered Internet service providers (ISPs) to prevent access to more than 70 URLs following a court order.

The directive was issued on the basis of an order from a court in Gwalior, said Gulshan Rai, director general of CERT-In (Computer Emergency Response Team-India). The order signed by Subodh Saxena of the department of telecommunications (DoT) was issued on Thursday and was reported earlier on Friday by the Medianama website.

Interestingly, the URLs listed include a University Grants Commission (UGC) notification that IIPM is not a university and “does not have the right of conferring or granting degrees as specified by UGC.”
The move comes amid criticism of the government for recent steps that have been regarded as attempts to curb freedom of speech.

DoT couldn’t be immediately reached for comment. UGC and IIPM representatives also couldn’t be immediately reached for comment.

IIPM has been the subject of several critical articles in various publications, including Outlook, Careers 360 and Caravan. A controversy had blown up in 2005 over attempts to gag a blogger critical of IIPM. That site too is among those ordered to be blocked.

Other URLs include stories on sites of publications such as The Indian Express, The Economic Times and blog posts on The Wall Street Journal site among others.

IIPM used to be a significant advertiser in large mainstream newspapers such as The Times of India and Hindustan Times until recently.

Source: Fri, Feb 15 2013. 05 39 PM IST
http://www.livemint.com/Politics/roausYEth9b0TvZv4r0whN/Govt-orders-blocking-of-IIPMrelated-URLs.html





 John Samuel Raja D dives deep into regulatory filings by Chaudhuri's companies to unravel eight facts about his businesses.
They Pay 1% of Rs 533 cr Revenues in Tax
Chaudhuri has four main businesses: management education, consulting, human resources and media. Each is housed in a separate company. In 2010-11, the latest available publicly, these four companies earned revenues of Rs 533 crore.
Its education arm, which offers management courses that are not recognised by the government, is the biggest of the four, with revenues of Rs 349 crore in 2010-11. In a recent TV interview, uploaded on the IIPM website, Chaudhuri says the institute admits 3,500 students each year.



A recent IIPM ad says its course fee is between Rs 14.75 lakh and Rs 18.75 lakh. In the last two years, revenues of the education arm have grown at 32% a year. Yet, on revenues of Rs 533 crore, the group posted a net loss of Rs 4 lakh, after paying less than Rs 5 crore as income tax. A possible explanation for this lies in two traits endemic to its operating style: big cost heads and many transactions between group companies.
IIPM Spends More on Ads than DLF
The IIPM ad template is large and flashy, full of claims and the larger-than-life presence of Chaudhuri. His website describes him as an "economist, management guru, author, speaker and transformational leader", who charges $100,000 (Rs 55 lakh) for a speaking engagement of 90 minutes. In the past few years, several IIPM claims on tie-ups with foreign universities and job placements have been proven untrue. At times, an examination of those claims or media reportage have become part of court cases filed by IIPM or its associates in places far from its base of New Delhi Silchar in Assam, Dehradun in Uttarakhand and Gwalior in Madhya Pradesh.

The books of the education arm show that, in 2008-09, it spent Rs 120.5 crore of its Rs 202 crore revenues on ads. Further, it spent Rs 16.6 crore to pay its educators under, as per Chaudhuri, three heads: salary (Rs 9.4 crore), professional charges (Rs 2.5 crore) and faculty remuneration (Rs 4.7 crore). In other words, for every rupee it spent on salary in 2008-09, IIPM directed Rs 7.2 into ads. "There are far too many industries globally with that high marketing budgets in comparison to salaries," says Chaudhuri.
In 2009-10, though, IIPM's ad spend halved to Rs 54 crore, while its payments to educators shot up four-fold to Rs 65.7 crore (Chaudhuri says it was above Rs 85 crore).
Seen another way, as a percentage of revenues, IIPM's ad spend of 60% in 2008-09 was higher than all the companies in the BSE-500 index; according to Capitaline data, Mahindra Holidays and Resorts was the highest, at 24.7%, while FMCG majors like Hindustan Unilever were at 11.4% and Colgate-Palmolive at 14.7%.
Even in absolute ad spends, only 38 companies from the BSE-500 were ahead of IIPM. At Rs 120.5 crore, its stated ad spend left behind some of India Inc's biggest advertisers like DLF, Axis Bank, Raymond and Gitanjali Gems. Some of IIPM's ad spends would have gone to group's publications, which raises the issue of how they were priced (more on this in Point 4). 

They Transact a Lot Among Themselves
Placement of ads in group publications is one of the many kinds of transactions between group companies. The education arm, the group's cash cow, is a major source of revenue for its sister firms. For example, in 2010-11, the education arm paid Rs 37.6 crore to the consulting arm, Planman Consulting Rs 31 crore for services received and Rs 6.6 crore as rent.
For Planman Consulting, which claims to have done work for the who's who of India Inc, these two transactions accounted for 84% of its Rs 45.8 crore turnover. That year, it was the most profitable company in the group, posting a net profit of Rs 7.8 crore on a net margin of 17%.
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