Zombies in the age of the Coronavirus

Indian Printer and Publisher 42nd anniversary issue

Zombie companies cannot repay their loans or even the interest to service these loans.
Zombie companies cannot repay their loans or even the interest to service these loans.

In a recent article in The Times of India, Ruchir Sharma wrote about ‘zombie’ companies. These are companies that can neither repay their loans nor the interest to service these loans. They cannot even pay dividends to shareholders unless they are stealing from somewhere – either the banks or from their employees or suppliers.

The pages of the financial dailies are littered with the troubles of the larger zombies. Some even blame the failing Indian economy and the reforms that don’t work as expected. Then comes the truly global Coronavirus pandemic with total unpredictability. Unlike the disasters of 11 September 2001 or the financial collapse of 07-08, there is no cathartic end in sight. Every individual and every business is affected. And the large number of freelance, informal, adhoc and casual workers are ground to dust. All the glib talk about the gig economy turns to bile.

It is the small and medium publishers and printers who are now the zombies. Unable to repay the so-called loans taken at extortionate interest rates and with so much collateral that there is no risk to the lenders, we are unable to pay the interest, let alone the EMI’s on our loans. Despite us being straightforward brick and mortar enterprises, the soft loans and private equity go to the dishonest borrowers who flee. To the ‘startups’ and the vaporware racketeers that specialize in presentations about their losses. Even in our industry, many companies borrow and grow their top lines with hypercompetitive pricing, only hoping to be acquired by some foolish foreign investor.

The question is which foreign investor who is serious about business and creating wealth will invest in a company in an environment ruled and created by an authoritarian government? A government keen to gather more power to itself so that it can rewrite textbooks with false history and pseudoscience to feed its inferiority complex. The keenness to drunkenly assert your past and future greatness come only from a sense of inadequacy and failure.

Which investor will see merit in a government that nurtures an undemocratic and anti-scientific environment of hatred and intolerance? A government that tells lies about its provocative actions and watches while a minority community is slaughtered and its’ places of business and worship are incinerated in broad daylight while the police stand by. A government that cannot tolerate criticism and a government that undermines the constitutional role of the judiciary by openly corrupting judges and offering them lollipops to do its bidding.

Sometimes the penny only drops when there is a catalyst such as a Coronavirus that forces us to clean our spectacles. I shall not vent or rant on since this is our 42nd-anniversary issue, once again barely finished on a Saturday afternoon. Nevertheless, even after so many years, we are happy that we can pick up the phone and speak to some of our friends. We may not agree about everything, but we will continue to defend not only our mutual rights of self-expression but those of every citizen and resident of our country.

I only want to thank the hundreds of companies, both publishers and printers, and input suppliers who have helped and, at times, even saved us. It’s been an exciting time, and we have learned much about our fellow citizens and our readers. We only hope that as they have given us the courage to speak out for what is right and wrong, that we have also been of some help or at least amusement to them. That we have pointed them in the direction of finding things out for themselves. And for sharing their experiences and their ideas.

The Covid-19 pandemic led to the country-wide lockdown on 25 March 2020. It will be two years tomorrow as I write this. What have we learned in this time? Maybe the meaning of resilience since small companies like us have had to rely on our resources and the forbearance of our employees as we have struggled to produce our trade platforms.

The print and packaging industries have been fortunate, although the commercial printing industry is still to recover. We have learned more about the digital transformation that affects commercial printing and packaging. Ultimately digital will help print grow in a country where we are still far behind in our paper and print consumption and where digital is a leapfrog technology that will only increase the demand for print in the foreseeable future.

Web analytics show that we now have readership in North America and Europe amongst the 90 countries where our five platforms reach. Our traffic which more than doubled in 2020, has at times gone up by another 50% in 2021. And advertising which had fallen to pieces in 2020 and 2021, has started its return since January 2022.

As the economy approaches real growth with unevenness and shortages a given, we are looking forward to the PrintPack India exhibition in Greater Noida. We are again appointed to produce the Show Daily on all five days of the show from 26 to 30 May 2022.

It is the right time to support our high-impact reporting and authoritative and technical information with some of the best correspondents in the industry. Readers can power Indian Printer and Publisher’s balanced industry journalism and help sustain us by subscribing.

– Naresh Khanna

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