Here come the Sales (if thats what you want to call them)

The nicely named misnomer, “The Annual Auction Sales” are upon us as breeders have started arriving in Pune for the annual ritual that follows the Indian Derby on the First Sunday of February. One would think its a time for breeders to cash in somewhat at what can best be described as a Pashu Mandi or Animal Market. All the breeders pay ₹ 12,000 per animal for the privilege of coming to the annual gathering conducted by the RWITC. You’d expect any sales company to at least vaguely promote their sale but RWITC couldn’t be bothered. They’ve got the breeders by the nuts and they know it, over and above this you can factor in another ₹ 3,000 for various tests and vaccinations, truck freight of another Rs. 10,000 per animal from North India and a cost of another ₹ 5,000 per animal for the groom’s expenses, so all in all to arrive in Pune costs a straight up ₹ 30,000 per horse without factoring any extra fodder costs. Breeders this year are fearing the worst as overall demand has been very sluggish over the course of the year. The Indian Breeding industry is caught in the middle of the perfect storm.

Rampant overproduction is the root cause of the problem but there are multiple causes for this unfortunate situation. To start with the Indian Economy is very sluggish and there seems to be a severe shortage of capital in an overall situation as India tries very hard to balance inflation at the risk of stagnation. Excessive welfare schemes need to be funded and the government is looking for newer ways to collect funds and as such are coming hard after what is perceived to be a high end luxury industry. This perception hurts us and we have done fiddle all to change this erroneous perception. The horse racing and breeding industry provides no less than 20,000 direct jobs over and above this a large number of secondary industries such as transporters, hotels, equipment manufacturers, feed suppliers, medicine manufacturers etc. benefit greatly from the industry. A highly misinformed tax official sitting behind a desk somewhere in South India decided it would be prudent to hit stake money with 30% TDS or Tax Deductible at Source. I have been involved as an owner in this sport for a few decades now and one thing is very apparent, in a good year one breaks even on the cost of keeping a horse in training and this is without factoring in the capital cost incurred when buying a horse. Does an IPL franchise pay any TDS on the prize money earned by them? Similarly it would be interesting to find out whether golf pros like Jeev Milkha Singh, or tennis players like Leander Paes get a chunk taken out of their purse earnings like this. This has led to a lot of uneasiness in the market as the government which has never helped the sport in any way whatsoever in the history of Indian racing is trying very hard to destroy us, whether it is evacuation threats vis a vis leased properties our clubs run on, custom duties on horse imports, insane tax regimes such as in Maharashtra where bookies pay a lower tax than the tote. All of us are to blame for this but most of all its the Turf Authorities of India, the body which is a conglomeration of all clubs in India which has failed on every front when it comes to the marketing of our sport. In a business where Forty year olds are considered young one can well imagine the average age of the wise old men that are at the helm of affairs in racing it would be safe to say that it would be 60+; in other words a majority of our racing committee members could travel on Indian Railways getting a 50% discount on their tickets by virtue of being senior citizens. Its time a large number of our administrators (and you know who you are) gracefully called it a day. Its about time our sport professionalised itself we need competent people who are paid proper CEO salaries to work for the sport, whether its government liaison, marketing, finance etc. in Indian racing we have club secretaries playing this role, something they’re clearly unqualified to handle.

Breeders as a whole are partially to blame for the situation but do keep in mind that when the cycle corrects itself its the breeders who bear the brunt of it too. Rampant overproduction due to multiple causes has hit the sport hard, better breeding techniques due to advances in technology have led to higher fertility rates as a whole. Many established farms have been very irresponsible too whereby they have taken their mare numbers to well over 150, it seems greed has made these breeders into imbeciles as they have clearly failed to see the writing on the wall. One could blame imports for this but it wouldn’t be fair as that has contributed to this but not in a big way. Too many inferior mares from racecourses with poor pedigrees as well as poor performance have found their way into the Indian thoroughbred gene pool. The cataloguing standards people came up with a system which is the Pattern Race system or black type races, breeders need to know their pedigrees and racing class much better and be more discerning when choosing their mares. Trainers have been dumping crap on many of the newbies in the business who in their eagerness to develop relationships for the future take anything to stud that trainers offer up on terms. In fact there are a large number of trainers who have made stud farms into their surrogate operations dumping shitty mares on to them. Its about time breeders take a stand on not breeding these inferior mares just because you want to do a favour to somebody you hope becomes a future client. Do the trainers buy your unsound stock? Hell no they don’t so when a shit mare is offered to you, “JUST SAY NO!”

Another very important reason for this situation is the inability of race clubs to cull out inferior stock. Mysore Race Club is a case in point, here stake money levels are equivalent to Bangalore but the quality of horses running are somewhere between shit and garbage. Aged horses which are discarded from all over India find their way to Mysore, where racing is never about excellence its only about the punt. A Derby gamble or a “B” class gamble pay out the same amount; while its tough to prepare a Derby winner any fool with a license can produce a low end winner. When poor horses aren’t cleared out of our tracks fewer stables are available for babies to come in. There is a very simple solution to all this we need to scrap age group handicap races, if an 8 year old can compete and beat a four year old in open company then so be it. One never has a problem when a horse like Coral Gables wins a Category one race at the age of 11 but when Admiranda at the age of 8 wins a 0-25, 6 years old and over race at Mysore at 4-1 odds there is a huge problem. Our sport needs to be a lot more about performance, we need a larger programme for our better horses which unfortunately is not forthcoming. We have too much racing for bad horses and not enough racing for say the top 20% of stock that we produce. In essence what happens is that there is very little incentive to get rid of lowly rated aged horses from our tracks since the majority of our races are written for them.

In tough times hard decisions must be taken, in the breeders case its culling mares and when I say cull it means that these mares need to go out of circulation, they shouldn’t relocate from Pune to Punjab. My Surdy brethren are very quick to take back mares from Pune post sales on terms, in fact they take back more numbers than they bring to the sales in the shape of yearlings. Buyers need to be more discerning too, they need to insist on scope and vet reports from breeders or else take their business elsewhere. When they visit farms they should always ask to see the broodmares as well as next year’s stock, they should also go around farms and see the amount of paddock space provided as well as things like fodder stock. Rather than be polite, buyers should ask questions and do more research as to what they are buying into, you wouldn’t buy a new car or TV on a lark, the same holds good whenever one is buying livestock too. So best of luck for the sales to all the breeders, we’re going to get tanned in the blazing Pune sun, lets hope our rears don’t get tanned as well!

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4 thoughts on “Here come the Sales (if thats what you want to call them)

  1. Hello Sir

    hope this period gets over soon , a recession is part of every business done legally by the knowledgeable but if stretches beyond a limit can BANKRUPT anybody , and the present condition was invited deliberately by some calculative and strong business minded people who found it more simple and flexible to kill the competition rather than to be the competition

    Sir you have addressed the issue relating to HORSE RACING BUSINESS AND ENVIRONMENT from day one you are here and it is really sad to see when we have such big names of international level who can really make happen a difference in INDIAN RACING HISTORY , who have earned NAME FAME MONEY here bother the least to do so

    I’m a very keen follower of your blog and every post you make , hope to read many more such posts in future and wish to GOD ” our rears don’t get tanned ”

    Regards

    BANG ON

  2. Greetings Mr Tegbir,

    A very well written article highlighting the current plight of racing and breeding. Enjoy your writing. I must say, I second your thoughts.
    Would like to share some of my views.

    Breeders (Stud Farms) – The stud farms across the nation, seem to have lost the overall vision. As rightly acclaimed by you, they seem to be rather interested in boosting their numbers than increasing the quality of the crop. During my recent visit to a reputed stud farm I have access to, I could see mares by the hundreds, stationed there, which took me aback. And to my surprise, a considerable number of them, I remember, gracing the tracks not very long back.
    Additionally there were stables which housed the “just arrived from abroad, carrying mares”.
    One thing I understood, is the intent to increase the number of foals is very evident.
    The costs for running a stud farm will certainly be high, what the breeders must realize is only quality product is going to give them the returns and the profits they intend to achieve. Stud farms form the base of the country’s racing scene, and they must deliver high quality produce,in order to take India’s racing to international standards.

    Turf Authorities of India (TAI) and our Indian Society – TAI, might be doing its part to keep the racing in India going, but is just to escape the slow death of Indian Racing their only motive?
    The first thing on the agenda should be to clear the name of racing from the society’s TABOO list. I was on the receiving end of some firing when, one of my friend found out that visited the race course to attend the races. I got into an argument with him, giving all the possible reasons like its legal, its approved by the government, even bigges like Dr. Mallya etc are into it….. but NO..in the end I lost, I was forced to accept that racing was BAD. I, thoroughly enjoy racing, and want my friends, relatives to come and experience racing, but sadly I’m scared to tell people come join me for a day at the races.
    Would be grateful to TAI if they do something to clean up the image of racing in the society.
    The tax issue – Mr. Dhunjibhoy, some time ago when he was the chairmain of RWITC, had spoken about requesting the Government to lower the taxes on the Racing industry including the betting. This he promised would certainly double if not triple the Income of the Government received from racing. Dont know if this was actually taken up with the Government and followed up with a little bit of Persuasion and some Pressure. A supporting point which Mr. Dhunjibhoy highlighted was, with that amount of money, the Corporation would be able to build tens of Parks in and around Mumbai, instead of Grabbing the Picturesque and Historic Mahalakshmi Race Course.

    The Annual Sale at Pune Race Course – Being from Pune, I see that I attend the sales, even if I dont intend to Purchase always. The following statement may raise a few eyebrows, but as far as I know – “The top class babies dont even make it to the sales at Pune”. The top lot of the crop is 1. Retained by the Stud Farm Owners, 2. Bought well before i.e. around Dec-Jan by some of the country’s powerful, big owners, influential trainer; 3. Sold Privately.
    The ones that make it to Pune are not the best. Taking nothing away from the sale at Pune, the horses at the Sale are indeed good, infact I can faintly recall some horses purchased at the sale/auctions which went on to do extremely well.
    Last year, I witnessed horses being sold for as low as Rs. 35,000 being sold at the auction. One horse went for Rs. 50,000, at the auctions whose price was earlier quoted as Rs. 4,00,000.
    What is making me wonder now, after Mr. Tegbir highlighted the various costs associated with the Sale, what do these breeders earn and how are they able to sustain the business.

    Encourage small owners – A fraction of solution to solve the whole Indian Racing Problem Puzzle could be by encouraging people from the Middle class society to own horses. They can put together a group of like minded people and own a couple of horses. Formation of syndicates could also help their cause. This will ensure that instead of suffering heavy losses, by buying a dud horse and waiting for it to deliver while the lady luck shines, they buy a couple of well bred horses and reap the benefits of the performance, reduce (divide) the risks and Losses and enjoy the sport as an Owner.

    A small incident that I narrate to my friends (usually after couple of drinks) – as kid, in my early school days, my Dad did not allow me to play football and represent my school in the inter-school tournaments citing that I would miss my classes and my academic ranking would dip. That year I gave my favourite game a skip. But the following year, my coach seeing me play extremely well during the sports period, insisted I represent the school. I played without the knowledge of my parents using borrowed sports shoes. I scored a handful of goals en-route my school finishing runner-ups in that tournament and a photo my mine featured in the local daily whilst scoring a goal. I ended up as the highest scorer of the tournament and another pic of mine receiving the trophy featured. I was scared with regards to what the reaction of my dad would be. But to utter surprise, he took me to the sports shop and bought me complete football kit and encouraged me to participate further. (Apologies, if I bored you with this short incident, but the following few lines may connect us back to racing).

    What if the horse you own along with a couple others, wins the feature race of the day or say any race and a picture of you features on the Page 3 receiving the trophy from any one from the following list – Salman Khan, Kareena Kapoor, Katrina, Chief Minister, Comissioner, Governor, Dr. Mallya, etc.. Wont your neighbours, friends and colleagues be super jealous of you and would wish to be in your shoes at that moment, certainly yes. And suddenly all those eyes who saw you doing wrong and all the mouth who spoke wrong about you and racing would magically turn RIGHT.
    Turf clubs must also start encouraging small owners. Specially by making the interview process for the ownership a one less tedious. I, in spite of having all the apt documents in place, had a tough and long time getting my ownership approved.

    Thanks for the wonderful article Mr. Tegbir, looking forward to hear further on this and many more. Apologies, if I went a little adrift from the main topic.
    Wish to see a day when Racing in India is at Par with the international circuits and thoroughly enjoyed by the Indian Population as a fun, thrilling and a family sport.

    Racing is real Fun, when enjoyed responsibly. Cheerzz !!

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