Hype and Reality !

Dear Friends,

My latest article in "The Telegraph" Newspaper reaching over a million readers for your reading pleasure, comments are welcome !

If you have picked up any newspaper in the past month, no doubt you’ve read stories announcing new record values for works of some Indian masters. But as they say, the devil lies in the detail and that is where a sensational headline can give people the wrong idea about the art market being on a new roll.

Let me make this easy for you so that you get a clear understanding of what’s going on in the art market. Take a look at the summer auctions at the major auction houses.

Starting with the modern art market, yes prices and volumes for some of the works by key artists — Hussain, Raza, Gaitonde, Souza and Tyeb Mehta — are back up at the peak levels witnessed in June 2008. This marks a significant recovery if you recollect that volumes in the modern art market had tumbled 63 per cent and prices fell 46 per cent between September 2008 and March 2009.

The key highlight in the summer sales was the auction of 152 works from the Souza estate through Christie’s which went at double their high price estimate. There were some very good works and it was an opportunity for people who had missed acquiring Souza works to buy them.

But is the excitement triggered by news reports of the record price of Rs 16 crore fetched by Raza’s Saurashtra justified? Well yes and no. Yes, because it was an exceptional work and no because what has sold in the auctions at higher prices are works which have been exceptional in terms of high quality, rarity and provenance, so it deserved the price but not the hype.

Artist S.H. Raza

Works which do not meet these criteria are still not selling or selling at much discounted valuations.

So be careful in this new market. I have started getting a lot of calls from my friends who say they would now like to acquire a work by one of the modern masters as the prices are expected to go even higher and their budget range of Rs 20 lakh to Rs 30 lakh will get them nothing that is even close to outstanding.

Jumping into the market now — unless you are very certain about the quality of what you are buying will only make the make a gallery richer and the collector or buyer poorer — saddled with a work that is tough to sell. I already know of someone who has bought a very ordinary Raza work at a valuation which should have been 50 per cent below what he has paid. Remember the “golden rule of significance” whenever you collect art — namely buy significant and defining works.

Now to the Contemporary Art market or younger artists as we know them. They had a 93 per cent correction in volume, as per Art Tactic, an independent art research firm, which means auction houses had very few people consigning Contemporary Art and the prices slid a massive 85 per cent between September 2008 and March 2009. Well, they are still down by 35 per cent from their peak. Volumes are better but not even close to what you saw in the boom times.

But you may have noticed that Bharti Kher set a new record of close to Rs 7 crore for her work "The Skin speaks a Language not its own" at Sotheby’s evening sale. The work was sold in 2007 at Art Basel and is her most defining work till date. The work according to international sources was sold again in 2008 at the peak of the art market at close to this current valuation. This means that the person who consigned this work having bought it when prices were at their peak in 2008 really has not gained much. Lesson: it never does pay to buy into the hype.

Bharti Kher’s work titled The Skin speaks a Language not its own

Interestingly Subodh Gupta has slowly been creeping up the charts again. I always get surprised when his paintings sell well because, according to me, Subodh is one of the most brilliant installation artists of our times, but when his paintings sell at higher prices it’s always a sign that people are again not buying significant works from his stable.

An untitled work by Subodh Gupta

His famous installation The Hungry God is a case in point and when it comes on the auction market it will set a new record for contemporary art in India. Again, though as some collectors get smarter, Bharti’s significant work sold at Sotheby’s and Subodh’s work — which was estimated to fetch Rs 2.5 crore to Rs 3.5 crore — did not sell.

The lessons from the summer auction are very clear, whether it is in the modern space or the Contemporary space, buy exceptional works, buy works that are significant of their times and have a good provenance. Do not be carried away and end up collecting or investing in high value art without research.

Also remember to analyse price patterns if you’re investing rather than collecting. One of the reasons for new records being established is also the fact that private museums being set up in India are buying. This is further adding fuel to the fire and prices for exceptional works from the modern masters are touching lifetime highs. Also I fear that market speculative forces are again back at work and it pays to be cautious. There is definitely some level of insider trading again visible in the auctions.

And of course, the final message to collectors, the most important golden rule —buy only what you love!

Kapil Chopra is Senior Vice President of Oberoi Hotels & Resorts.He writes a blog on collecting and investing in Indian Contemporary Art at www.indianartinvest.blogspot.com.He also writes for The Telegraph Newspaper in the Sunday magazine " Graphiti" every fortnight. In Delhi, he writes for "The Mail Today " Newspaper and the "First City" Magazine.

Rules of Buying Art after a Difficult Year !

This is my new monthly column in "Mail Today" newspaper on the Art Market. Mail Today from the India Today group is one of the leading newspapers in New Delhi and the National Capital Region.

Enjoy !

The year 2009 started on a difficult note for Indian Contemporary Art but it looks poised for a recovery in 2010, though it is still early days. Last year saw the prices commanded by most Indian contemporary masters sink to all- time lows with some values dropping by more than 75 per cent from their peak.

The Art Tactic Confidence Index sank to a low of 19 in March, but it had recovered to 46 in November 2009 — in plain terms it means that 46 per cent of the collectors would buy contemporary art now, compared with 19 per cent in March. The improvement, as you can see, is relative and there are hardly any buyers for works over Rs 10 lakh.

In the two years before 2009, values had become unsustainable and some of that trend continues till this day. Most of the shows opening in Delhi in the last two months had disappointing sales; only 20 per cent of the works got sold — so much for the ‘ recovery’! All that you hear today is good news, such as a Manjit Bawa selling at Rs 1.6 crore, which is close to a new record, but not that most of the top contemporary artists were struggling at the auctions. So please discount the statements emanating from the galleries that the market is booming and collectors are buying.

What does one do in 2010? Well, you must know that the values are still high and gallery prices are what they used to be at the time of the boom — maybe 10 per cent lower. If you buy at these prices, you’ll end up with a hole in your pocket. So here are some of the rules for you to follow — buy what you really like and would love to hang on the wall; go for the younger contemporary artists with reputed addresses such as Nature Morte, Gallery Chemould, Sakshi Art Gallery, Guild Art Gallery, Project 88 and Latitude 28. The prices should ideally be lower than Rs 2 lakh, but even then, research the artists before collecting their work. Consult other collectors if you believe your favourite artist has potential to grow in the future.

In the top- end contemporary space, it may be prudent for you to wait and watch. In the year gone by, I have bought T. V. Santhosh because he was able to hold his prices even at the peak of recession. The other is Seher Shah, who is still up and coming, but the values are good. All the others are younger artists with prominent galleries — like Sajjad Ahmed, Prajjwal Choudhary, Shreyas Karle and Siddartha Kararwal, whose work is priced between Rs 50,000 and Rs 2 lakh. At the upper end of the spectrum, the only artist I would buy at reasonable valuations is N. S. Harsha, who’s not prolific but is very talented.

Game Theory by T.V. Santosh

The year 2009 also saw over 600 investors in the Osian’s art fund struggling to get their capital back. My response is that people who invest in a fund that promises to give higher than bank returns are courting a risk.

If people lose money because they weren’t diligent enough, or because they became passive investors after reading art world headlines, then it was bound to happen. The Indian art market does not have a big enough base of collectors to support an art fund, so wait for the market to really grow before you lose your money in such ventures. Art bought for financial returns can be risky because of the lack of pricing transparency and also due to the fact that it isn’t liquid like other assets.

I would rather enjoy the process of buying art, hang some great canvases on the wall, make sure I apply the principles of intelligent buying to protect my capital and spend time reading on how to buy art and not invest in art funds. Spend time on the World Wide Web, visit shows at the best galleries in the cities, read blogs, and you are on your way to becoming a well- informed art collector!

Kapil Chopra is Senior Vice President of Oberoi Hotels & Resorts.He writes a blog on collecting and investing in Indian Contemporary Art at www.indianartinvest.blogspot.com.He also writes for The Telegraph newspaper in the Sunday magazine " Graphiti" every fortnight. In Delhi, he writes for "The Mail Today " newspaper and "First City" magazine.

Splashed in Red - September Auction Analysis for Indian Contemporary Art

Here is the article published in "The Telegraph" posted here for the International readers of this blog....... Check out the auction analysis with help from Art Tactic and figure out if there is really a recovery ........

You could say that the ‘Indian art season’ has kicked off. In September, there were three major auctions — Saffronart, Sotheby’s and Christie’s — and the results are a pointer to which way the art world will be headed in coming months.

So what can we look forward to? The modern art market looks strong — but the same can’t be said for Contemporary art.

The star of the season so far is one of the old masters, Tyeb Mehta. Even in this market , he notched up Rs 6.4 crore for one of the Mahishasura canvases.

He wasn’t the only one to make a splash. A rare but good-sized 57in x 92in Jagdish Swaminadhan went for close to Rs 2.75 crore at the Christie’s auction. This really goes to show that — as always — there are buyers willing to pay a premium over market prices and even market conditions for good quality art.

At the Sotheby’s auction, I was impressed by the nice Rs 3 crore figure for a V.S. Gaitonde canvas. Now, Gaitonde was one of the least prolific artists of his times and very few works are available. This was a 65in x 40in work and it’s typical of the abstract work he was known for.

This untitled Manjit Bawa work fetched a stunning Rs 1.27 crore at the Saffronart auction

In the Saffronart auction nearer home, both Akbar Padamsee with a value of close to Rs 1.87 crore and a stunning Manjit Bawa at Rs 1.27 crore were standout performers.

Yes, the top lots did do well. And this has lent weight to those who argue that the Modern art market has recovered.

But let me give you an interesting set of statistics: There were a total of 161 lots of Modern art at these three auctions and out of these, 107 — or close to 70 per cent — sold at the lower end of the estimate or did not sell. So the recovery was mainly in exceptional works of Tyeb Mehta, MF Hussain, S. H. Raza, F. N. Souza and Gaitonde.

Tyeb Mehta notched up Rs 6.4 crore for this Mahishasura canvas

Meanwhile, the Contemporary art scene was disappointing to say the least — and the picture looks even bleaker if you compare it to the Contemporary art sales last September.

Both Modern and Contemporary art prices have fallen this year; As the second graph shows, 81 per cent of the contemporary lots are selling at the lower end of the estimate or failing to sell

Last year, at the three September auctions, Contemporary art worth Rs 58 crore was sold. This year that figure fell to a pitiful Rs 4.5 crores — at all three auctions combined. That includes a very surprising performance of close to Rs 1.8 crore for a lovely Jitish Kallat work, Dawn Chorus — 7. Kallat has, over the last one year, failed to sell at a number of auctions, so this new sale record was a pleasant surprise.

With this exception, I didn’t see one result in the entire Contemporary space that merited. In fact, the sad truth is none of the three auctions had much quality work. The reason: collectors aren’t dispatching their best works to auctions because they fear the works will fetch less than their purchase price.

Looking through the sales figures drills home the fact how even seasoned collectors get carried away during good times when there’s too much money chasing art which isn’t always the best quality.

During the boom Atul Dodiya held a famous water colour show with some 40 of his works on display at Bodhi Art gallery in Mumbai. Each work was on sale, at the time, for about Rs 20 lakh — there weren’t many buyers at that price even then. But two of the same works came up for sale at Sotheby’s. They sold finally for about Rs 6 lakh.

The same phenomenon has struck many other collectors who have lost close to 70 per cent of their buying price. Art should be bought because you like the work and you relate to the work and it strikes an instant chord. Art bought for investment will never yield the right returns. Also, the price point is the key and you can burn a deep hole in your pocket if you get carried away and don’t do your research.

Similarly, a Surendran Nair canvas failed to sell in the second consecutive Saffronart auction despite decent estimates, showing there is no genuine collector demand for his canvas works at the current price points.

The ArtTactic Indian Auction Indicator for the Contemporary market is standing at 19. This implies 81 per cent of the contemporary lots are selling at the lower end of the estimate or failing to sell, indicating estimates could fall further before market equilibrium is attained.

Going ahead, I’d like to see the auction houses come up with better works. Let’s see some good significant works by artists like T.V. Santhosh, N.S. Harsha and Bharti Kher in the coming auctions. Let’s see some of the young artists who are doing cutting-edge work and being shown at some of the world’s important art fairs. I believe the next few months will be a great time to be buying exceptional art by some of the top Contemporary artists.

Kapil Chopra is Senior Vice President of Oberoi Hotels & Resorts.He writes a blog on collecting and investing in Indian Contemporary art at www.indianartinvest.blogspot.com.He also writes for The Telegraph newspaper in the Sunday magazine " Graphiti" every fortnight. In Delhi, he has written for "The Mail Today " newspaper and "First City" magazine.

Conversation With Art Collector Kapil Chopra by Invitation at ARTSingapore

In April 2009, the Art Tactic Confidence Indicator fell by 63 % from October 2008. Valuations in the contemporary space have dropped by close to 60 % from last year and are now near the bottom. Meet avid art collector Kapil Chopra, who will share with you some insights of his strategies and join him in this exciting presentation that will take you through the roller coaster ride of Indian Contemporary Art and also highlight the current and future stars of the Indian art world.

Known for his frank, unbiased and critical take on artists and valuations of artworks in his blog, http://www.indianartinvest.blogspot.com/, Kapil Chopra is a passionate art collector of Indian contemporary art. He also writes for publications such as "The Telegraph ", "Mail Today" both newspapers and “First City” magazine in New Delhi. As Senior Vice President of Oberoi Hotels & Resorts, he runs one of India's most spectacular hotels, Trident. Gurgaon, New Delhi National Region and is also opening Asia's most luxurious hotel, The Oberoi,Gurgaon, which will further set new benchmarks in hospitality.

A Broader Canvas - India Art Summit - Reflections

Dear Friends,

Here is the latest article published in "Telegraph" newspaper for your reading pleasure!

The India Art Summit 2009 is over but memories of the event that drew some 40,000 visitors will linger for a long time to come. For a start, it must be said that this has been the first really successful art fair in India. There were over 55 galleries taking part including 18 international ones, which is a record. On show were works by the legendary Pablo Picasso and our own Mumbai-born Anish Kapoor, the sculptor well known for his large public works.

Top class international galleries like London’s Lisson and Arario from Beijing were also in attendance at the summit, which was spread over three sprawling halls at Delhi’s Pragati Maidan.

Visitors at the India Art Summit 2009

The art on display was in some cases exceptional, especially the Moderns. Both Delhi Art Gallery & Dhoomimal gallery exhibited very good collections of S.H. Raza and F.N. Souza. They had good quality works from all the important time periods on display.

By contrast, the Contemporary part of the Summit was a bit lacklustre. The major galleries in the Contemporary space did not put on show their ‘A’ list of artists. Instead they featured a lot of emerging artists and in some cases trotted out for the summit their second and third lists of artists who had not sold in recent shows.

Subodh Gupta’s Alibaba (2009, oil on canvas, 6.5ft x 12ft) at Trident,Gurgaon show

Nevertheless, the art summit was a laudable initiative even if some of the galleries insisted on thinking short-term, trying to flog art which was not the best they had to offer. This attitude will need to change in the future if the India Art Summit is to move up from here and be considered a truly serious international-level art fair.

Still I was impressed with the roster of opening and collateral events from Anant Art Gallery, Talwar Art Gallery, Gallery Seven Art and also a fantastic opening show at the Devi Foundation in Gurgaon. These events kept the fair busy and exciting.

Interestingly though, I was even more impressed with the international galleries. Arario, the powerful Beijing gallery, actually showed a big installation by L. N. Tallur, the promising Korea-based Indian artist and a large Jitish Kallat canvas. I also took to the fact that international galleries had really a very eclectic range of art to show. They seemed to be quite serious about their display and were looking at the lucrative potential of acquiring a new Indian collector base.

Turning to the speaker forum, the organisers had put together a very good mix of top artists, galleries, curators and collectors. Frank opinions were aired and there were some heated debates on the commercial aspects of art. Amrita Jhaveri, who runs an art advisory spoke about all the stakeholders in the circle of collecting art and the conflicts of interest that they sometimes have. Nitin Bhayana, one of India’s top collectors, shared his insights on how to build a great collection.

Bharti Kher’s The left-over DNA of a little mouse that the cat ate (2009, bindis on painted board, 72in x 96in) at Trident, Gurgaon show

Peter Nagy of Gallery Nature Morte was clear on his views from a gallery perspective and stressed he always was particular about the collector who was buying the work in order to promote genuine collectors and discourage speculators. Finally Anders Petterson from ArtTactic, the research think-tank, said stated categorically that, in his view, we are close to the bottom in both the Modern and Contemporary art space price-wise, according to his surveys in the Western world and even in the Indian space. He feels, however, that real recovery is still 12 months away for the Contemporary art space.

From the quality of Contemporary art presented, Nagy from Nature Morte saved the best for the last, with his show, Realisation of all Possibilities, at the Trident Gurgaon, which hosted the VIP Closing party (I must state an interest here as I was the show’s host).

The roster of artists were the best in the Indian Contemporary art space and the scale of the works was exceptional and not seen often with a 12ft x 6.5ft canvas by Subodh Gupta, a 8ft x 6ft canvas by Bharti Kher and a 6ft x 5ft work by Bharat Sikka.

Also there was a 12ft x 8ft canvas by Bari Kumar and a towering 14ft Transformer sculpture by Thukral & Tagra, and a 10ft x 5ft work by New York-based Seher Shah, which was also shown at The Armory Art Fair in New York. The scale and size of works from such important Contemporary artists in one show has not been seen in at least a year.

In the wake of the huge crowds that turned up for the summit, many commentators suggested that it showed the art market was on the road to recovery. I wouldn’t put big bets on that yet, but good quality art will always have buyers. So until you get that exceptional piece of art, hold your purse and don’t get carried away!

Kapil Chopra is Senior Vice President of Oberoi Hotels & Resorts.He writes a blog on collecting and investing in Indian Contemporary art at www.indianartinvest.blogspot.com.He also writes for The Telegraph newspaper in the sunday magazine " Graphiti" every fortnight. In Delhi, he has written for "The Mail Today " newspaper and "First City" magazine.