FINC/072

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IBS Center for Management Research

India Inc Cash Surplus: Strategy or Lack of Opportunity?

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This case was written by Nitya Nand Tripathi, under the direction of D. Satish, IBS Center for Management Research. It was
compiled from published sources, and is intended to be used as a basis for class discussion rather than to illustrate either
effective or ineffective handling of a management situation.

2011, IBS Center for Management Research. All rights reserved.

To order copies, call +91-08417-236667/68 or write to IBS Center for Management Research (ICMR), IFHE Campus,
Donthanapally, Sankarapally Road, Hyderabad 501 504, Andhra Pradesh, India or email: info@icmrindia.org

www.icmrindia.org

FINC/072

India Inc Cash Surplus: Strategy or Lack of

Opportunity?

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"Only companies with large surpluses will take some risk and invest in equities. These long-term
investors expect just 14-15% returns on equity investments. The total cash pile of BSE 500's Richie
Rich has grown to Rs. 1,285 billion (bn) from Rs.1,100 billion (bn) 2010, excluding banks and
NBFCs.1
- Ramkrishna Kashelkar, The Economic Times2, July 12, 2011

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On July 12, 2011, a popular business newspaper in India carried an article that showed that about
hundred out of the five hundred companies of the BSE -500 had accumulated huge cash balances.
The total cash balances accumulated by these companies amounted to 93% of market
capitalization of the BSE-500 shares. The previous year, there had been 116 companies with huge
cash balances. However, the cash holding increased by 17%3 from the year 2010. The companies
which held huge cash balances included bigwigs like Tata Motors with Rs. 109479.3 million,
Infosys with Rs. 150,900 million, and Reliance Industries with Rs. 301,390.3 million. The cash
was invested in short-term instruments but the companies had a strong reason for keeping such
cash pile. Rather than keeping the shareholders cash idle or in liquid investments, the companies
were planning their future strategy around the surplus excess cash. On the right strategy with the
excess cash, Seshagiri Rao, CFO & joint MD of JSW Steel Group, commented, "The company
keeps aside surplus cash as insurance for the future or invests the same in the business.
Investments in business are better than any investing in any liquid asset."4

CASH AND EXCESS CASH

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Cash management is a very critical process. Companies generate cash from their operations. This
is the cash companies generate out of their internal business activities from their regular
businesses. The companies also generate cash out of investments and from the sale of some longterm assets as well as sale of investments both short-term and long-term strategic investments and
investments in subsidiaries. Cash can also be generated from financing, whether it is through
equity financing or debt financing, or hybrid financing. Generally, companies maintain an
appropriate cash balance to take care of the liquidity needs in their regular business. Sometimes
due to realization from huge sales, they end up piling up more cash than required for regular
business.

2
3

Ramkrishna Kashelkar, Total Cash Pile of Bombay Stock Exchange's 500 Companies Like Bharat
Heavy Electricals, Lakshmi Machine Works, Bharat Electronics and Others Rises 17%, www.
economictimes.indiatimes.com, July 12, 2011.
The Economic Times is a leading business daily newspaper in India.
Ramkrishna Kashelkar, Total Cash Pile of Bombay Stock Exchange's 500 Companies Like Bharat
Heavy Electricals, Lakshmi Machine Works, Bharat Electronics and Others Rises 17%, www.
economictimes.indiatimes.com, July 12, 2011.
Rupali Mukherjee and Partha Sinha, Why RIL, Tata Motors, Hero Honda Need not Worry about RBI's
Rate Hike,www. economictimes.indiatimes.com, August 1, 2011.
1

India Inc Cash Surplus: Strategy or Lack of Opportunity?

What is excess cash?

There are conflicting opinions and thoughts among academics and analysts on what can be called
excess cash. Aswath Damodaran, Professor of Finance at the Stern School of Business at New
York University, commented, Operating cash balance is usually assumed to be 1% to 2% of the
revenue.5
According to investorwords6, a company is set to have excess cash if it accumulates more than 20%7
of its revenues as cash. According to some analysts, excess cash can be measured with the ratio of
net cash8 to market capitalization of the company. David Sterman9, a stock analyst, commented, In
fact, companies can be so cash-rich that even after accounting for any borrowings, their cash can
equate to 20%, 30%, or even 40% of the entire companys market value.10

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During the year 2011, cash-rich companies generated reasonable returns from their additional cash
through investing in short-term risk-free bonds or in fixed deposits. Since the Reserve Bank of
India hiked policy rates in January 2011 to fight inflation, companies got a higher return on their
deposits with banks. There were predictions that the interest rates would only move up in the short
term. Some analysts commented, To attract deposits, banks would be offering higher interest
rates. This rate war will continue for a few more months taking FD rates still higher.11. If excess
cash is found with companies, the historical cash accumulation trend should be observed. It should
be noted that cash generated or accumulated suddenly does not make a company cash rich. On this
issue, Anand Lunia, CFO of Seed Fund12, commented, Make sure the extra money really is in
excess and not a one-time bump from an unusual sale or savings from a one-time cost cut. Invest a
sizable proportion of this extra cash in an interest-bearing account or low-risk investment vehicle
to last several months anywhere from three to 12 months, depending on your industry in order
to insulate should the economy contract and customers are unable to pay.13 However, India Inc
was considered to be well positioned globally in holding the excess cash (Refer to Exhibit I for
Various Financial Data about the Companies).

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Cash for Expansion and beating inflation: Bajaj Auto Limited

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Bajaj Auto Limited, the third largest automobile company in India, earned good profits from its
business from 2007 to 2011. It became market leader in the motor-bike category and was slated to
enter the four-wheeler segment. Due to good revenues and a higher profit margin, the company
reimbursed most of its debt and accumulated a huge cash balance. It accumulated net cash of
91.24% of its total assets. Rajiv Bajaj (Rajiv), Managing Director of the company, commented on
the accumulation of huge cash balance and on the expected forthcoming capital expenditure, Due
to strong operating margins, coupled with effective working capital management, we had surplus
cash balance. Moving forward, he was worried about the escalating inflation in the economy
5
6
7
8
9

10

11

12
13

Aswath Damodaran, Investments in Cash and Marketable Securities, Corporate Finance.

Investorwords is known as the biggest and best investing glossary on the web.
Excess cash, www.investorwords.com.
Net Cash = Cash - Borrowings
David Sterman started his career in equity research at Smith Barney. He also worked as an investment
analyst for long time and became Senior Analyst worked at Smith Barney. www.istockanalyst.com.
David Sterman, This Company is Sitting on a Mountain of Cash, www.topstockanalysts.com, April 18,
2011.
Quickies, Cash-rich Companies that can Give You Good Returns in Coming Months, www.
economictimes.indiatimes.com, January 12, 2011.
Seedfund is Mumbai based venture capital fund company was started in 2006.
Bhuvnesh Talwar, Managing Surplus Cash,www,franchiseindia.com, March 23, 2010.
2

India Inc Cash Surplus: Strategy or Lack of Opportunity?

which might lead to a rise in the cost of raw materials. After analyzing past experience, he added,
There is no clear sign but hope that raw material prices will be flattened. Input cost pressure is
expected to continue, but with reasonable certainty, we can say that the worst is behind us.14
The company also took major capital expenditure decisions. It planned to establish its fourth plant
near Mundra port. This plant would be able to produce five million two wheelers and would also
be utilized to manufacture four wheelers with Nissan-Renault. The management intended to export
more than fifty percent of its production. The company projected an initial expenditure of Rs.
10,000 million. Rajiv spoke about his plan, We are looking to build our fourth plant in Gujarat
near the Mundra port. Our present capacity of manufacturing of two-wheelers is enough till only
the middle of the year (2011) and we need to expand the capacity of plants. We will build our fourwheeler facility, including for passenger cars, there.15

PY

Cash for uncertainty: Infosys

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Infosys, a ubiquitous software company, earned a profit at Compounded Annual Growth Rate
(CAGR) of 14.24% from 2007 to 2011. The company accumulated a good amount of cash. On
March 31, 2011, its cash balance stood at 54.4% of its revenues. Infosys is a total equity-based
firm. On the buildup of huge cash, V Balakrishnan, CFO of Infosys, commented, The company
generally maintained sufficient cash reserves to meet the salary needs of all its employees for the
next one year. The company planned to expand its business in China with the prospective of
markets for services and as a good source of talent. The company is expecting to generate the
revenue of $ 240 million in next three years. On expansion of the China business, Rangarajan
Vellamore, Chief Executive Officer, Infosys Technologies (China) Co. Ltd., commented, Infosys,
which has announced $100 million investment in China, is aiming to triple revenues from the
country from the current $80 million in about three years.16 However, the company had started
business in China in 2004 and until now the company had invested $25 million in capital
expenditure there.

Cash for Buyback: Hindustan Unilever Limited

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The accumulation of excess cash can reduce the actual market value of a company as the company is
unable to utilize the shareholders money to generate the required rate of returns as expected by the
shareholders. Some companies maintain excess cash without a clear future plan and are also in a
maturing phase. In this scenario, most companies use cash to pay dividends or buy back their equity
from the market. The buyback strategy helps in increasing the Earnings Per Share (EPS) and show
good returns. Hindustan Unilever Limited was incorporated in 1933. The company grew rapidly and
established a market leader position in Fast Moving Consumer Goods (FMCG). During the year
2011, the companys cash balance mounted to Rs. 28,304.3 million and it also paid a cash dividend
of Rs. 14,106 million. The company had no debt since 2010 in its financial statement. The board of
directors decided to use the surplus cash to buy back shares for amount of Rs. 6,300 million.17 The
news of the buyback, announced on June 3, 2010, led to a 4.02%18 increase in share price. By the end
of the financial year 2011, the outstanding shares were reduced to 2159.5 million from 2181.7
million (2010). This was Hindustan Unilever Limiteds second buyback after 2007.. The buyback
would perhaps help to increase Unilevers control of Hindustan Unilever and also pave the way for
the company being delisted from the Indian markets.
14
15
16
17
18

Bajaj Auto's Profit Rises Two-Fold to Rs.3,455 cr (Rs. 34.55 billion), www.hindu.com, May 19, 2011.
Bajaj Plans To Set Up Car Plant Near Mundra Port, www.indiatvnews.com, July 20, 2011.
Infosys Bets on China; to invest $100 m, www.thehindubusinessline.com, July 26, 201.
Annual Report 2010-2011, page no. 29.
Our Bureau, Hindustan Unilever Mulls Share Buyback, www.thehindubusinessline.com, June 3, 2010.
3

India Inc Cash Surplus: Strategy or Lack of Opportunity?

Cash for Bonus and Dividends: ITC and Wipro

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ITC Ltd., a diversified company, maintained a huge cash balance since 2007 to meet its immediate
requirements and capture opportunities to invest cash for the expansion of its business. During the
financial year 2010-2011, the companys cash and bank balance stood at Rs. 61727.9 million
29.23% of its revenue. The company issued 1:1 bonus shares in 2011 and also declared hefty cash
dividends of Rs. 34,434.7 million. Besides, the company planned to utilize its cash for expansion
and diversification. The company had made inroads into the FMCG and retail sector. PN Vijay19
commenting about the investment by the company said, "ITC has been almost like a bank deposit
type of thing in those bad days. I am amazed at the way it has performed through bull and bear
market, a very strong company. They have invested a lot in to brand building in the non tobacco
FMCG space. The numbers are coming in the top line which is very good news because they are
using their surplus cash. ITC would be a buy for me for all seasons."20

CO

Cash accumulated from business could be utilized for organic or non-organic growth. If the
company did not find a suitable target, it distributed the cash as dividends. Wipro, a major IT
company, piled up huge a cash balance of Rs. 99,875 million. The company issued bonus shares in
the ratio 2:3 and distributed a hefty dividend of Rs. 9,81821 million during the financial year 2011
which was 11.45% higher from 2010.

Surplus Cash for investments: Reliance Industries Limited

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Reliance Industry Limited (RIL), a heavyweight company in the BSE -30, had accumulated an
enormous cash balance and bank balances of Rs. 364,958.4 million in 2011. It grew 66.72% from
the financial year 2010. The management said they had invested the excess cash in very liquid,
highly rated securities such as bank fixed deposits, CDs, and government securities and bonds. The
company planned to double production from its petrochemical business to utilize the entire surplus
amount. However, some analysts opined that the company could be struggling to employ the
surplus cash successfully. Manish Kumar and Puneet Gulati, analysts at HSBC Securities and
Capital Markets (India) Pvt. Ltd., commented, RIL is struggling to deploy the cash it is
generating from its businesses. Given the size of the company and limited organic growth options,
maintaining its historical earnings growth of around 23% per annum is a tall order in the absence
of an inorganic growth strategy.22 The company also accumulated cash from a stake sale to BP.
But the management of the company did not expect the excess cash to adversely affect the
company. According to Mukesh D. Ambani, Chairman and Managing Director of the company,
The surplus cash and receipt of $237.224 bn cash from the sale of 30% stake to BP Exploration
(Alpha) would strengthen Reliances balance sheet and help the company reinvest in India. He
did not specify, however, whether the company had plans to acquire assets or to set up new
projects.25

19

PN Vijay is a founder of P N Vijay Financial Private Limited. The company provides provide welth
management services to its clients.

20

One can Buy ITC,says PN Vijay, Portfolio Manager,www.moneycontrol.com, May 24, 2011.

21

Refer Exhibit-I for Various Financial Information About the Companies.

22

Aveek Datta, Excess cash may pose earnings hurdle for RIL, www.livemint.com, February 26, 2011.

23

1$= 44.9649, www.xe.com, February 21, 2011.

24

ITGD Bureau, BP to take a 30% stake 23 RIL oil & gas blocks, www.businesstoday.intoday.in,
February 21,2011.

25

Aveek Datta, Excess cash may pose earnings hurdle for RIL, www.livemint.com, February 26, 2011
4

India Inc Cash Surplus: Strategy or Lack of Opportunity?

Right Direction to Surplus Cash: Tata Motors

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On March 31, 2011, Tata Motors waited for opportunities to utilize cash of Rs. 109,479.3 million.
In 2008, the company had utilized its accumulated surplus cash of Rs.38, 331.7 million to acquire
luxury car brands Jaguar-Land Rover for $ 2.5 billion from Ford Motor Co. On this occasion,
Ratan Tata, Chairman of Tata Group, commented, "We have enormous respect for the two brands
and will endeavor to preserve and build on their heritage and competitiveness, keeping their
identities intact.''26 . The Tata Group constantly looked to deploy surplus cash on making big ticket
acquisitions whether it was the Tetley or Corus acquisition. On utilizing the surplus cash, Tarun
Sisodia, Executive Director of Institution Equity at the Anand Rathi Group, commented, "Cash is
useful for faster growth through M&A etc., but the business environment must be conducive for
faster growth. Overall, IT is the only sector that fits into this scheme right now. Companies have
enough cash and there is enough opportunity to grow also."27

Parking Excess Cash

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The finance departments of Indian companies played safe with any surplus cash generated. This
cash was parked as fixed deposits with banks or invested in mutual funds and typically in safe debt
funds. However, some of the CFOs parked their excess funds in Equity Linked Mutual Funds. A
Chief Executive Officer of a mid-size fund house, commented, Treasury managers are testing
waters with small investments say about 300-500 million per fund. They invested a few
thousand million in February, March, and May, when the market corrected by a few percentage
points. These companies have taken a valuation call. They have invested in funds as they feel
markets will not fall any further and there is significant upside over the next 16-18 months."28 As
equity investments were considered risky, a majority of the companies continued to invest in
liquid debt funds. Tarun Bhatia, Director of Capital Market in Credit Rating Information Services
of India Ltd (CRISIL29) Research, said, "Most corporate treasuries have large investments in liquid
debt funds."30

26

27

28

29

30

Samita Sawardekar, Pass or Fail: Tata Steers Jaguar Land Rover to Profit, www. online.wsj.com,
June 6, 2011.
Quickies, Cash-rich Companies That can Give You Good Returns in Coming Months, www.
economictimes.indiatimes.com, January 12, 2011.
Shailesh Menon,Big Corporates and Cash-Rich Companies Investing in Equity Mutual Funds, www.
economictimes.indiatimes.com, June 27, 2011.
CRISIL is Indias first credit rating agency, incorporated on January 29, 1987. It was promoted by the
erstwhile ICICI Ltd., along with UTI and other financial institutions.
Ramkrishna Kashelkar, Total Cash Pile of Bombay Stock Exchange's 500 Companies like Bharat Heavy
Electricals, Lakshmi Machine Works, Bharat Electronics and Others Rises 17%,www.
economictimes.indiatimes.com, July 12, 2011.
5

India Inc Cash Surplus: Strategy or Lack of Opportunity?

Exhibit I

Various Financial Data about the Companies

( Rs in million)
Bajaj Auto Limited

Mar '07

Mar '08

Mar '09

Mar '10

Mar '11

16254.3

13343.4

15700

13385.8

3251.5

Total Investments

64475.3

18571.4

18085.2

40215.2

47952

Subsidiaries investment

11659.5

10946.2

7642.9

6264.8

2496.1

Cash and Bank Balance

621.6

547.4

1356.8

1002

1554.5

Fixed Deposits

213.2

13.3

11.9

12.1

4010.4

71597.5

29219.3

Total Assets
Capital Expenditure

Not
Available

94202.4

Other Income

5671.6

Total Expenses

80894.5

Reported Net Profit

12379.6

88271.5

34396.9

42669.2

52353.7

3925.4

1166.7

2006.3

87001.7

118132.5

164518

CO

Net Sales

Not
Available

PY

Total Debt

1702.7

-62

225

11760

78097.9

75796.1

93406.4

132792.9

7559.5

6564.8

17027.3

33397.3

2893.7

3183

5787.3

11574.7

4047.3

Shares in issue

101.18

144.68

144.68

144.68

289.37

400

200

220

400

400

633

618

2011

1399

Share Price

N
O

Equity Dividend (%)

Equity Dividend

Hindustan Unilever
Limited

Dec '06

Dec '07

Mar '09

Mar '10

Mar '11

12 mths

12 mths

15 mths

12 mths

12 mths

726

885.3

4219.5

Total Investments

25222.2

14408.1

3326.2

12640.8

12606.8

Subsidiaries investment

2095.25

515.94

652.08

453.6

702.6

Cash and Bank Balance

1708

2001.1

1905.9

2313.7

2819.1

2461.5

7.5

15867.6

16608.4

13581

75883.2

68300.7

84515.2

95190.4

102231.1

398.72

1498.05

1322.98

1907.3

1742

122440.2

138805.6

205042.8

177691.2

196899.1

5126

4283.7

2765.4

1997.3

4394.8

Total Expenses

105683

119661.9

179736.7

149908.9

173205

Reported Net Profit

18553.7

17690.6

25007.1

22020.3

23059.7

D
O

Total Debt

Fixed Deposits
Total Assets

Capital Expenditure
Net Sales
Other Income

Contd

India Inc Cash Surplus: Strategy or Lack of Opportunity?

Contd

Nil

6262.7

Nil

Nil

6253

Equity Dividend

13254.8

19761.2

16345.1

14179.4

14106

Shares in issue

2206.78

2177.46

2179.88

2181.69

2159.47

600

900

750

650

650

213.9

250.25

264.7

312.3

331

Mar '07

Mar '08

Mar '09

Mar '10

Mar '11

2008.8

2144.3

1775.5

1077.1

992

30677.7

29345.5

28377.5

57268.7

55546.6

Equity Dividend (%)

Market price
ITC Limited
Total Debt
Total Investments
Subsidiaries investment

8697

9190.8

14186.2

16251.1

687.3

1201.6

987.7

9636.6

10061.2

21444.7

139126.3

141720.9

160524.7

20568.5

16595.5

12479

10878.4

140322

149858.1

185674.5

211208.3

5165

4262.1

5450.5

7757.6

96155.1

106940.9

119875.9

142302.2

1035.4

1533.4

Fixed Deposits

7966.2

4169.1

106379.6

122721

Capital Expenditure
Net Sales

123138.3
2762.2

Total Expenses
Reported Net Profit

Bonus Shares

26999.7

31201

32635.9

40610

49876.1

3762.223

3768.61

3774.4

3818.177

7738.144

N
O

Shares in issue

86138.8

Other Income

CO

Cash and Bank Balance

Total Assets

Equity Dividend

PY

Buyback

(1:1)

11662.9

13190.1

13965.3

38181.8

34434.7

310

350

370

1,000

445

210.3

171.45

250.85

174.5

182

Mar '07

Mar '08

Mar '09

Mar '10

Mar '11

720

250

Nil

37020

1440

58340

69500

96950

105560

150950

112590

137950

137950

182470

250680

Capital Expenditure

11520

5650

11770

13700

14430

Salaries and other Expenses

74580

92070

117650

148810

165330

Total Numbers of Employees

130,820

113,796

104,850

91,187

72,241

Sales Turnover

138930

166920

216930

227420

275010

3720

7040

4730

9340

12110

95020

114540

144980

120710

150540

Equity Dividend (%)

Market price

D
O

Infosys Ltd.
Total Debt

Investments in Liquid Funds

Cash and Bank Balance
Total Assets

Other Income
Total Expenses

Contd
7

India Inc Cash Surplus: Strategy or Lack of Opportunity?

Contd

46590

59880

62660

68350

6490

19020

13450

14340

34450

571.21

572

572.83

573.83

574.15

230

665

470

500

1,200.00

1768.4

1117.85

2605.25

3445

2753

Mar '07

Mar '08

Mar '09

Mar '10

Mar '11

336514.8

506960.9

762666

646055.2

841061.9

Total Investments

52680.1

95228.5

64355.4

131122.5

215961.7

Current investment

32420.8

63844.5

Cash and Bank Balance

19370.4

44741.6

Total Assets

1122831
89800

Equity Dividend
Shares in issue
Equity Dividend (%)
Market price
Reliance Industries Ltd.
Total Debt

Capital Expenditures
Net Sales

1127701
6509.2

28735.7

84729.9

96028.4

227421

138908.3

301390.3

1480935

2072033.7

2168596

2500720.6

195030

247130

219430

60680

1371467

1512240.1

2037397.2

2658106

59569.5

19142.4

25428.2

107830.3

1155360

130071.4

2322248.3

1788729.9

195213.8

196814.1

299288

325901.9

Total Expenses

943391.8

Reported Net Profit

120748.3

Shares in issue

Other Income

PY

38670

CO

Reported Net Profit

1393.51

1453.65

1573.8

3270.37

3273.37

14404.4

16312.4

18970.5

20846.7

23849.9

110

130

130

70

80

2861.05

1230.25

1089.4

1058.25

879.15

Tata Motors Ltd.

Mar '07

Mar '08

Mar '09

Mar '10

Mar '11

Total Debt

77216.7

115848.7

349738.5

351083.6

327914.1

11745.9

26658.3

12574

22191.2

25442.6

Short-term Investments

1375

12220

800

1074.12

1208.78

Cash and Bank Balance

11542.7

38331.7

41213.4

151966.8

109479.3

Total Assets

160908

217251.5

419977.3

452991

543056.1

24563

47059.5

51181.3

28733.3

23962.9

Net Sales

323612

356600.7

709388.5

925192.5

1231333

Other Income

1531.8

2674.8

7989.6

17931.2

896.1

Total Expenses

282468

314099.5

687414.5

839050.9

1053533.3

Reported Net Profit

22047.9

22347.5

-21292.5

92207.9

25168.9

Equity Dividend

5780.7

5784.3

3116.1

8590.5

12742.3

Shares in issue

385.37

385.5

514.01

570.56

634.61

N
O

Equity Dividend
Equity Dividend (%)
Market price

D
O

Total Investments

Capital Expenditure

Contd
8

India Inc Cash Surplus: Strategy or Lack of Opportunity?

Contd

150

150

60

150

200

Market price

742.1

159.05

792.6

1306.3

1,243.80

Wipro Ltd.

Mar '07

Mar '08

Mar '09

Mar '10

Mar '11

2380

38224

50139

55302

47441

43487

45001

68953

89665

108134

subsidiaries Investments

1043

1343

52575

58849

60292

Cash and Bank Balance

18492

37321

19021

19383

23342

25071

37260

28691

95584

154331

Total Debt
Total Investments

Fixed Deposits
Total Assets

175289

232224

260650

16388

10632

1656

215073

229220

263005

4804

8667

6033

139640

167448

175315

205712

30633

29738

48980

48437

8765

5860

8809

9818

1461.5

1464.98

1468.21

2454.41

Capital Expenditure

Other Income
Total Expenses
Reported Net Profit

136839

174926

2887

3269

105157
28421
8737

Shares in issue

1459

Bonus Shares

Market price

300

N
O

Equity Dividend (%)

Equity Dividend

CO

Net Sales

525.6

PY

Equity Dividend (%)

2:03

300

200

300

200

233.55

679.4

490.25

415

D
O

Source www.moneycontrol.com,www.bse.com and companies annual reports

India Inc Cash Surplus: Strategy or Lack of Opportunity?

Suggested Readings and References:

Datawatch: 50 cash rich companies, www.moneycontrol.com,September 24,2009.

2.

krishna.kant,India's Most Cash Rich Promoters, www.etintelligence.com, 2007.

3.

6 cash rich companies, www. myiris.com, January 9,2010.

4.

Quickies, Cash-rich companies that can give you good returns in coming months,
www. economictimes.indiatimes.com, January 12, 2011.

5.

Kiran Kabtta Somvanshi, Jyothy Laboratories: Cash-rich company better placed to

bid for Henkel, www.economictimes.indiatimes.com, March 17, 2011.

6.

Are cash rich companies your favourites? www.equitymaster.com, December

15,2010.

7.

Ramkrishna Kashelkar, Total cash pile of Bombay Stock Exchange's 500 companies
like Bharat Heavy Electricals, Lakshmi Machine Works, Bharat Electronics and
others rises 17%, www. economictimes.indiatimes.com, July 12, 2011.

8.

Shailesh Menon, Big corporates and cash-rich companies investing in Equity Mutual
Funds, www. economictimes.indiatimes.com, June 27, 2011.

9.

BS Reporter, Banks offer higher rates for deposits of longer tenures, www.businessstandard.com, July 13, 2011.

10.

PFC, NPCIL mull lending Rs 12K cr for power projects, www.moneycontrol.com,

July 13,2011.

11.

Dell embarks on a shopping spree, puts India on radar, www.moneycontrol.com,

June 18,2011.

12.

N Sundaresha Subramanian, Cash-rich

www.business-standard.com, June 29, 2011.

13.

Concerns
over
pledged
shares
www.moneycontrol.com, June 22, 2011.

14.

Shraddha Nair & Sapna Agarwal, Unilever to set up VC fund in India,

www.livemint.com, June 24 2011.

15.

An interview, Oil India may strike overseas acquisition this year: Director,
www.economictimes. indiatimes.com, June 21, 2011.

promoters

'irrational',

unlock

share

pledges,

says

SMC

Global,

D
O

N
O

CO

PY

1.

16.

PTI, Coal India earmarks over Rs 10,000 cr capex for FY12, www.livemint.com,
May 13, 2011.

17.

PTI, PFC in talks with NPCIL for lending Rs 12000 cr for power projects,
www.livemint.com, July 13, 2011.

18.

PTI, BHEL to hire 25,000 in next 5 years, www.livemint.com, June 19, 2011.

19.

Baiju Kalesh & Sneha Shah, Topsy Mathew | Dilution of equity is the last option for
Indian promoters, www.ivemint.com, February 21, 2011.

20.

Aveek Datta, Reliance Infra merger with GTL to create Rs50,000 cr network,
www.livemint.com, June 27, 2010.

21.

PTI, Cash-rich Infosys finding difficult to make acquisitions at right price,

www.livemint.com,

22.

August 31, 2009.

23.

PTI, Bhels NBFC plan delayed, board seeks changes: CMD, www.livemint.com,
July 3, 2011.
10

India Inc Cash Surplus: Strategy or Lack of Opportunity?

24.

PTI, Bhel likely to take final call on floating NBFC by April, www.livemint.com,
March 13, 2011.

25.

David Sterman, This Company is

www.topstockanalysts.com, April 18, 2011.

26.

The Staff of the Corporate Executive Board, Investors Don't Need Your Excess Cash,
www.businessweek.com, March 1, 2011.

27.

Bajaj Auto's profit rises two-fold to Rs.3,455 cr (Rs. 34.55 billion), www.hindu.com,
May 19,2011.

28.

Bajaj Plans To Set Up Car Plant Near Mundra Port, www.indiatvnews.com, July 20,
2011.

29.

Our
Bureau,
Hindustan
Unilever
www.thehindubusinessline.com, June 3, 2010.

30.

Nestle shareholders to get excess cash back, www.financialexpress.com, January

15,2007.

31.

One can buy ITC,says PN Vijay, Portfolio Manager, www.moneycontrol.com, May

24, 2011.

32.

Infosys sitting on huge cash surplus, www. economictimes.indiatimes.com, June

4,2006.

33.

M&M
launches
open
offer
to
Inds,www.moneycontrol.com, July 21, 2011.

acquire

34.

Goutam Das, IT companies dump

www.financialexpress.com, June 28, 2011.

MFs

35.

India: Tata becomes India's wealthiest group,www.bbc.co.uk, June 20, 2011.

36.

Pranav Nambiar, Shareholders returns from TCS, HCL and others dip,
www.economics. indiatimes.com, April 21, 2011.

37.

Aveek Datta, Excess cash may pose earnings hurdle for RIL, www.livemint.com,
February 26, 2011.

38.

Bhuvnesh Talwar, Managing Surplus Cash,www,franchiseindia.com, March 23, 2010.

39.

Infosys bets on China; to invest $100 m, www.thehindubusinessline.com, July 26,

2011.

Sitting

on

Mountain

share

Cash,

buyback,

CO

PY

mulls

of

bank

stake
fixed

in

EPC

deposits,

D
O

N
O

for

20%

40.

Samita Sawardekar, Pass or Fail: Tata Steers Jaguar Land Rover to Profit, www.
online.wsj.com, June 6,2011.

41.

Rupali Mukherjee and Partha Sinha, Why RIL, Tata Motors, Hero Honda need not
worry about RBI's rate hike, www. economictimes.indiatimes.com, August 1, 2011.

42.

Chapter 14, Corporate Finance, by Aswath Damodaran.

43.

www.moneycontrol.com

44.

www.bse.com

45.

www.xe.com

46.

www.itcportal.com

47.

www.bajaja.com

48.

www.ril.com

49.

www.tatamotors.com

11