Business News

IPOs can absorb 'huge' FII inflows: SEBI

2010-10-12T10:46:00.000-07:00

Amid diverse views over the huge capital inflows into equity markets from FIIs, market regulator Sebi said that numerous public offers coming to the market could absorb that money and act as a balancing factor.

If the inflows from foreign institutional investors (FIIs) chase same numbers of papers then obviously prices will rise, but issuance of new papers could absorb that, Securities and Exchange Board of India Chairman CB Bhave said.

"I am not saying whether FII inflows are a concern or not … I am saying balancing factor is issuance of papers," Bhave said.

Indian Express

Maran acquires another 7.42%stake in SpiceJet

2010-10-12T10:31:00.000-07:00

Sun TV chief Kalanithi Maran and his firm KAL Airways have bought 7.42% equity for Rs 135.10 crore, as part of the June deal to acquire 37.7% stake in low-cost carrier SpiceJet.

This was an off-market transaction, following which Maran's direct stake in the airline now has increased to 25.12%, SpiceJet said in a filing to the Bombay Stock Exchange.

Last week, Maran had increased his direct stake in the company to 17.71% through similar transactions.

In June, the Chennai-based industrialist had clinched a deal to acquire 37.7% stake in the low-cost carrier for about Rs 750 crore from American investor Wilbur Ross, his investment companies and the Kansagara family-promoted Royal Holding Services Ltd.

The latest transaction, through which Maran has bought about 2.86 crore shares (7.42 per cent stake), at a price of Rs 47.25 per piece, is pursuant to the share purchase agreement signed at the time of the deal, the filing said.

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Times Of India

Pfizer will buy King Pharmaceuticals for $3.6bn

2010-10-12T10:27:00.000-07:00

Pfizer Inc, the world's largest pharmaceutical company by revenue, said Tuesday it will buy pain drug maker King Pharmaceuticals Inc. for $3.6 billion in cash.

Pfizer is paying $14.25 per share for King. That's a premium of 40 percent to the stock's Monday closing price of $10.15. Pfizer gains products including the pain drug Avinza, and Embeda, an extended-release pain treatment that is designed to be abuse-resistant.

King, of Bristol, Tennessee, has struggled in recent years as patents on several of its key drugs have expired or been thrown out.

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Times Of India

India industrial output growth slows to 5.6%

2010-10-12T10:23:00.000-07:00

Industrial growth slowed down to 5.6 per cent in August from 10.6 per cent in the corresponding period last year, on the back of a 2.6 per cent contraction in the capital goods production.

Among the main industry segments, manufacturing activity declined to 5.9 per cent from 10.6 per cent a year ago. Mining sector growth was at 7 per cent as compared to 11 per cent in August last year.

Electricity generation growth, too, slowed down to one per cent from 10.6 per cent in August last year.

Capital goods sector contracted by 2.6 per cent in August, in comparison to 9.2 per cent growth in the year-ago period, official data released here said.

Also, consumer non-durables, which are mainly fast moving consumer goods (FMCG), recorded a negative growth of 1.2 per cent, in comparison to an expansion of 6.1 per cent in the same month last year.

Consumer durables was the only segment of goods, which saw an output growth over the year-ago period. In August consumer durables expanded by 26.5 per cent, as compared to 24.7 per cent in the year-ago period.

Of the 17 industry groups, as many as 14 have shown positive growth during the month of August. The industrial expansion figure for July was revised upwards to 15.2 per cent from the earlier estimates of 13.8 per cent.

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Times Of India

Sensex closes 137 pts lower on IIP data

2010-10-12T10:16:00.000-07:00

Heavy selling of blue chips like Reliance Industries and Larsen & Toubro dragged down the BSE benchmark Sensex by nearly 137 points today amid concerns over slowing domestic industrial output growth and a weakening global trend.

The 30-share index of the Bombay Stock Exchange fell by 136.55 points to settle at 20,203.34 at the close of trade today, compared to 20,339.89 points at the end of yesterday's session.

During the day, the gauge tumbled to an intra-day low of 20,107.25 points after the release of data showing that industrial production grew at a slower pace than market expectations in August, 2010.

The wide-based National Stock Exchange Nifty fell below the 6,100 points level today after shedding 44.95 points to 6,090.90. During intra-day trade, the Nifty touched a low of 6,057.95 points.

The industrial production growth rate nearly halved to 5.6 per cent in August compared to the previous year. Finance Minister Pranab Mukherjee has expressed disappointment at the factory output numbers.

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Times Of India

IndusInd Bank net profit up 71% to Rs. 133.15 cr

2010-10-11T07:15:00.000-07:00

Riding on robust growth in net interest income (NII), IndusInd Bank on Mon clocked 71 per cent growth in its net profit for the quarter ended in September 30, 2010, at Rs. 133.15 crore as compared to Rs. 77.82 crore in the corresponding period last year.

"The NII of the bank for the second quarter is Rs. 329.73 crore as compared to Rs. 208.55 crore during the same period last year, with a strong growth of 58 per cent," IndusInd Bank managing director and CEO, Romesh Sobti, said.

The profitability momentum can be seen in the rise of net interest margin (NIM) from 2.86 per cent to 3.41 per cent and the core fee income has grown by 34 per cent, Sobti said.

The operating profit for the quarter is grown by 69 per cent at Rs. 261.65 crore as against Rs. 155.32 crore in the year ago period. Capital adequacy ratio has moved up to 16.22 per cent as against 14.91 per cent in the corresponding period.

Gross NPA has dropped to 1.21 per cent as compared to 1.50 per cent during the same period last year while net NPA has diminished to 0.36 per cent from 0.98 per cent.

NDTV

5-20% rise in Gurgaon realty prices

2010-10-11T07:12:00.000-07:00

In its bid to bridge the gap between real estate prices and existing sector rates, the Gurgaon district administration has jacked up the circle rates for the second time on Sunday. The revised rate will result in a 5-20% increase in circle rates of properties in Gurgaon from Monday.

The revised rates, according to property experts, might not have much of an impact on the real estate prices but it will make property registration a costly affair. The lowest increase in the circle rate will be in the case of properties falling in areas like Farukh Nagar, Pataudi and Manesar that are outside the already declared residential, commercial and industrial zones. The circle rate will witness a 20% increase in case of colonies falling under urban Gurgaon, the new city and private colonies.

Deputy commissioner R K Kataria said only few patches of land falling under areas where new sectors will come up will see an over 20% hike in the rate declared by the district administration. This has been done after studying and observing the recent trend of property registration in Gurgaon. This will also help us reduce the gap between government fixed circle rate and the actual market rate. This will also reduce the role of black money in this business, the DC added.

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Times Of India

Sensex up 90pts on Q2 earnings expectations

2010-10-11T07:06:00.000-07:00

Led by Reliance Industries and Tata Motors, stock market benchmark Sensex today gained nearly 90 points on expectations of healthy second quarter earnings by India Inc amid firm global cues.

Auto, metals and energy stocks contributed the most to the gains in 30-share barometer of the Bombay Stock Exchange, which ended the day at 20,339.89, up 89.63 points, or 0.44 per cent.

During the session, the BSE sensitive index moved between a high of 20,461.27 and 20,250.26.

The National Stock Exchange's wide-based 50-share Nifty Index too finished the day higher by 0.53 per cent at 6,135.85.

"Market participants are waiting for numbers of September quarter and there are hopes for a healthy figures. Till the results are not out, stock specific action will be dominant in market," Geojit BNP Paribas Research Head Alex Mathews said.

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Times Of India

Gold futures hit crucial 20k-level

2010-10-11T07:02:00.000-07:00

Gold surged to hit a crucial Rs 20,000 per ten gram level for the first time in futures trade today on hectic buying by speculators, tracking strong global trend.

Pick up in spot market demand for the festival and marriage season further boosted the market sentiment.

At the Multi Commodity Exchange counter, gold for June- month delivery surged by Rs 132 to hit a record high of Rs 20,007 per ten gram, with a volume of one lot.

Similarly, the metal for delivery in December gained Rs 90, or 0.46%, to Rs 19,619 per ten gram, with a turnover of three lots.

Marketmen said the precious metal rose to an all-time high level as speculators created fresh positions in tandem with a firming global trend.

Air India to demand another Rs 2,000 cr to repay debts

2010-10-10T10:43:00.000-07:00

As the process to infuse Rs 1,200 crore as additional equity in Air India takes shape, the national carrier might ask for another Rs 2,000 crore from the government in the next financial year to repay its massive debt, official sources said today.

The airline would require Rs 3,000-Rs 4,000 crore annually to pay off its debt, which is primarily on account of aircraft induction, according to an official estimation.

The monthly interest burden on this count averages at Rs 200 crore, while the debt each month stands at about Rs 300 crore, the sources said.

In this backdrop, the airline may ask for another tranche of Rs 2,000 crore as equity some time in the next financial year, the sources said.

While the government infused Rs 800 crore in the last fiscal, a note for consideration to the Cabinet Committee on Economic Affairs (CCEA) is being prepared by Civil Aviation Ministry for an additional infusion of Rs 1,200 crore.

Prices of essentials rose 18 percent in one year: Assocham

2010-10-10T10:38:00.000-07:00

Prices of commodities like condiments and spices, eggs, fish, meat, tea, wheat, pulses and coffee rose by 18 percent in the one year between August 2009 and 2010, an industry lobby says.

In the same period, the per capita income of an average Indian rose by 10.4 percent - Rs.4,404 - from Rs.40,141 in August 2009, the study by the Associated Chamber of Commerce and Industry of India (Assocham) adds.

The study says that the rise in prices of essential commodities and per capita income is utterly disproportionate.

The prices of condiments witnessed extremely high volatility - 40 percent - between August 2009 and August 2010.

The survey found that the per capita consumption of condiments and spices in India is on the rise following a change in food habits. Winter, the season of weddings in north India along with Christmas and New Year celebrations, may also lead to an upsurge in the demand for spices.

Yahoo News

DLF plans more luxury malls

2010-10-10T10:25:00.000-07:00

Real estate developer DLF Ltd that currently operates luxury mall -- DLF Emporio -- in the Capital is considering to start similar projects in other big cities, including Hyderabad and Chennai, that are seeing traction for high-end brands.

"We are looking to open more luxury malls in cities like Hyderabad and Chennai," DLF Malls Business Head Savitri Devi Singh said.

The company is currently in talks with the existing tenants at its DLF Emporio for the same. "There are some 10-12 anchor brands we are in discussions with to bring up similar models in other cities," she said.

According to Singh, who did not disclose the investment planned by the company in future projects, developing malls for housing luxury brands is an attractive proposition.

"DLF Emporio has already broken even and is doing very well in terms of revenue generation. It is a very viable business," Singh said, although she declined to divulge the amount, developer invested on the mall.

Yahoo News

iPAD taking off @ breakneck rate

2010-10-10T04:39:00.000-07:00

The iPad’s destructive reach seems to be extending further and faster. Apple’s tablet is taking off at a breakneck rate. Analysts now predict up to 40 million will be sold in 2011. With personal incomes and spending stagnant, it’s looking like a zero-sum game in consumer electronics. Forget PCs and netbooks. The iPad will eat into camera and GPS device sales too.

How well the touch-screen gadget is really doing will become clear later this month when Apple reports its next set of quarterly results. But there are growing signs the company is selling way more of them than anyone outside Apple, or maybe even among Steve Jobs’ inner circle, had been anticipating. It’s clear the mini notebook computer market is being throttled. Netbook unit sales had been growing at more than 30 percent annually before the iPad was unleashed. Sales are now shrinking, according to market research firm NPD Group.

But the volume of iPad sales means there will be more victims. Early adopters of new consumer electronics typically have plenty of disposable income or spend a lot on gizmos, or both. The iPad is showing signs of extending beyond this base. It looks on track to become the fastest adopted consumer good ever. And that’s really saying something considering the competition includes the ubiquitous DVD player, and Apple’s own hyper-popular iPod and iPhone.

Rajasthan Royals and Kings XI Punjab out of IPL 4

2010-10-10T04:32:00.000-07:00

Indian Premier League governing council terminated the franchise agreements with the Rajasthan Royals and Kings XI Punjab even though the Kochi franchise was spared for now.

The Kochi franchise has been issued a notice and asked to settle internal differences.

The IPL 4 auction has been rescheduled to January 2001.

The decision was taken at an emergency meeting of the IPL governing council in Mumbai.

The three franchise teams -- Rajasthan Royals, Kings Eleven Punjab and newly-bought Kochi -- were given show cause notices by BCCI on September 29 as they had not complied with the rules governing the franchisers.

The board has also decided to hold the player auctions in the last week of November.

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Economic Times

BSNL achieves tangible growth in islands

2010-10-10T04:27:00.000-07:00

BSNL has achieved substantial growth in telecom services in the Andaman and Nicober Islands with its customer base having touched the 1,82,003 figure base.

Chief General Manager BSNL V K Sanjeev told media the overall tele-density in the islands, including private operations, is 62 per cent, having crossed the all India figure of 58 per cent, of which BSNL alone shares 36 per cent.

Sanjeevi said broadband facility is now available in all the exchanges of south, middle and north Andaman through optic fibre connectivity with Port Blair while other islands will be connected progressively.

He said public telephones are operational in 341 villages while a call centre was working to help customers.

Read More...

India's forex reserves rise to $294.16bn

2010-10-10T04:21:00.000-07:00

India's foreign exchange reserves increased by $2.563 billion to $294.158 billion for the week ended Oct 1, registering a gain for the third straight week on account of revaluation.

Foreign currency reserve rose $1.978 billion to $266.507 billion during the week, according to the Reserve Bank of India's weekly statistical supplement.

The value of gold reserves increased $508 million to $20.516 billion, Special Drawing Rights (SDRs) rose $56 million to $5.139 billion and reserve with International Monetary Fund increased $21 million to $1.996 billion.

However, the value of total reserves in Indian currency declined Rs.16,214 crore to Rs.13,14,789 crore.

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The Times of India

Nirma to quit bourses, buy back shares

2010-10-10T04:14:00.000-07:00

In a surprise move, Ahmedabad-based FMCG major Nirma Ltd, which at one time brought some of the top detergent players of the country to their knees, is all set to de-list from the bourses.

The Rs 4,620-core Nirma, pretty much a household name at one time largely because of its popular ad jingle, has lost most of its aggressiveness since then and has also diversified into non-related businesses such as pharma, cement and processed minerals.
The company, through a release issued on Saturday evening, said that the reason behind the move was to attain "flexibility to carry out its operations" and facilitate its foray into new capital intensive businesses. It may be pointed out that Nirma, over a period, has got into some capital intensive businesses like cement and there is a feeling in the company that existing shareholders may be averse to the changed risk profile of the new businesses.

The promoters of the company are expected to come up with an open offer to acquire the balance 3.63 crore equity shares of the company from the public at Rs 235 per share. At this rate, Nirma's promoters will have to shell out Rs 853.66 crore to buy them out.

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Times of India

Bill Gates to attend G20 business summit

2010-10-10T04:03:00.000-07:00

More than 100 global business leaders including Microsoft founder Bill Gates have confirmed they will attend next month's G20 business summit in Seoul, organisers said on Sunday.

They said Gates, who now co-chairs the charitable Bill and Melinda Gates Foundation, would be among 112 executives taking part in the November 10-11 event on the sidelines of the G20 leaders' summit on November 11-12.

In a statement, organisers said 35 business chiefs are from the manufacturing or IT sectors, 28 from finance, 25 from energy and 24 from logistics, maritime or other sectors.

They said the total sales of companies taking part add up to four trillion dollars and their assets total around 30 trillion dollars.

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Times of India

Market down by 84 points

2009-12-04T06:43:00.000-08:00

Bombay Stock Exchange benchmark Sensex fell by over 84 points, as funds indulged in profit selling after an unexpected contraction in the US job data revived their fears about the fledgling global recovery.

The Sensex, which remained flat from Wednesday after the massive rally on the first two days of the week, fell by 84.14 points to close at 17,101.54 points as heavy-weight stocks led by auto and banking counters saw aggressive selling. The key index moved between 17,291.83 and 17,032.81 points.

The wide-based National Stock Exchange index Nifty 50 too fell by 22.80 points to 5,108.90 points, after shuttling between 5,161.80 and 5,081.85 points during the session.

Selling pressure sparked following the Institute for Supply Management’s index of businesses that make up almost 90 percent of the American economy, sank to 48.7 in November.

Weak global cues further fueled the bearish sentiment.

Both Asia and Europe had weak openings today, which was visible in the opening of the local bourses.

Continued selling on the Reliance Industries, ICICI Bank, SBI, Maruti Suzuki, Hero Honda, Mahindra & Mahindra and Tata Steel counters capped the day's gains on the index.

Financial Express

Maruti A-Star a hit in Europe

2009-12-03T05:22:00.000-08:00

Maruti Suzuki India on Wednesday said exports of its new hatchback A-Star had crossed the one-lakh mark in less than a year of selling the car in the global markets. “The milestone was crossed with a batch of shipments leaving the Mundra Port (Gujarat) on Wednesday. A-Star’s green label has been a success in Europe,” a company statement said.

Maruti Suzuki had launched A-Star in November last year in India and started exporting it since January this year. Being produced only in Maruti’s Manesar (Haryana) plant, A-Star is currently exported to 69 countries and is sold as Suzuki Alto in Europe, South Africa, Australia and New Zealand. “Europe alone accounted for 93,562 units of the export. It is sold in 19 European countries, including the UK, Germany, Netherlands, Spain, Italy and France,” it added.

The Hindu

3D notebooks from Acer

2009-12-03T05:20:00.000-08:00

NEW RANGE: Acer India Managing Director W. S. Mukund (left) and Microsoft India Managing Director Rajan Anandan at the launch of new range of laptop with multitouch technology and 3D Notebook in New Delhi on Wednesday.

NEW DELHI: Acer on Wednesday launched 3D notebooks and a laptop with multi-touch display. The Aspire 3D notebooks come in Pentium dual core and Core2Duo platforms, with prices starting at Rs.43,500, while the two models of multi-touch display cost Rs.43,500 and Rs.60,000.

The 3D-enabled notebooks rely on a 3D film coating on the display, polarising glasses and bespoke software to display videos, games and photos in 3D.

Unique LCD technology works flawlessly as both 2D and 3D displays to create a brilliant video and photo viewing experience. Real-time 2D-to-3D playback convert technology enables the viewing of any video, DVDs, pictures and games as virtual 3D output.

“The future of 3D is firming up and we are proud to bring that technology alive in India and go main stream,” said Acer India Managing Director W. S. Mukund.

Similarly, the Aspire multi-touch series gives enriched digital multimedia experience with fingertip precision. Navigation is quick and seamless with touch screen features which allow the user to instinctively zoom in and out, manipulate pictures and artwork easily, browse photos, websites or documents by simply touching the screen.

The Hindu

World Bank lending to India hiked to $7 billion this fiscal

2009-12-03T05:18:00.000-08:00

The World Bank has committed to hike its lending to India to about $7 billion this fiscal as compared to an average loan assistance of $2.3 billion in the previous four financial years.

At a luncheon meeting at North Block with the visiting World Bank President, Robert Zoellick, here on Wednesday, Finance Minister Pranab Mukherjee also sought an early completion of the process of voice and quota reforms in the multilateral lending agency so as to increase the effective representation of emerging and developing economies.

During the meeting, according to an official statement, the World Bank chief and Mr. Mukherjee discussed wide ranging issues. Mr. Mukherjee not only lauded the lending agency’s increased funding to India in the wake of financial crisis but also hailed Mr. Zoellick’s personal contribution in this regard as he was instrumental in the Bank board’s approval of several loan packages amounting to $4.3 billion in one single day in September last year.

In response, Mr. Zoellick complimented India on being the single largest borrower of the World Bank and hailed the country’s contribution and the role that it has played in the World Bank group. He also sought India’s support in widening the capital base of the Bank to help it appropriately meet the needs of developmental finance.

The Finance Minister informed the Bank chief that India has always been at the forefront of providing greater capital support to all multilateral development institutions. For instance, it had enthusiastically supported a 200 per cent capital increase for the Asian Development Bank (ADB).

Funds for highways

Road Transport and Highways Minister Kamal Nath, who met Mr. Zoellick, said the World Bank had agreed to examine new ways of raising its funding commitment for India’s highway projects

“The World Bank has agreed to look at funding viability gap and in the annuity projects not only in terms of financing but in terms of institutional support as well… We are also working with the Ministry of Finance for a $2.96-billion loan for converting 6,300 km one-lane roads into two-lane ones. That is now in an advanced stage.” Funds and concessions under the viability gap scheme are provided to developers to make the projects viable. On the other hand, annuity is a funding model under which the project developer finances, builds and maintains the contract in exchange of annual grants from the government.

He said that as there were many projects at hand to be funded by the multilateral agency, the assistance may be provided in tranches and that decision would be taken by the Finance Ministry. “There are so many projects on the social sector...so we may take it in tranches ...there is a limit to what the Bank can give to us as a whole. That appropriation is done by the Finance Ministry.”

The Hindu

Food inflation up at 17.47%, onions still costly

2009-12-03T05:13:00.000-08:00

Food inflation soared to 17.47 per cent in the third week of November from 15.58 per cent a week ago, mirroring a shortage in supply that set in following weak monsoon in the country.

With the economy on upswing, analysts said the rising food prices should prompt the government and the Reserve Bank of India to shift their focus on controlling inflation, otherwise it would increase manufacturing inflation as well.

The economy grew by 7.9 per cent in the second quarter of this fiscal against 6.1 per cent in the previous quarter, rekindling hopes of a faster and steady recovery.

On weekly basis, onions turned expensive by over 12 per cent, while it surged by 30.89 per cent on a yearly basis. Rice and wheat prices also rose over 10 per cent on a year-on-year basis. However, the rise in prices of potatoes that have been surging, declined to 94.17 per cent on yearly basis, against over 100 per cent increase a week ago.

Altogether, inflation of primary articles (items found in raw form) rose to 12.53 per cent during the week ended November 21 against 11.04 per cent in the previous week.

The Prime Minister's Economic Advisory Council Chairman, C Rangarajan, has said food prices must be controlled, otherwise they have a tendency to lead to manufacturing inflation.

Times of India

Airtel asks TRAI to look into predatory pricing

2009-12-03T04:50:00.000-08:00

At a time when mobile tariffs are touching the lowest levels, the market leader Bharti Airtel sought sectoral regulator TRAI's intervention to ensure that players do not resort to predatory pricing practices to woo subscribers.

"The Telecom Reuglatory Authority of India (TRAI) should look at predatory pricing," Bharti Airtel CEO Manoj Kohli said in New Delhi.

With a view to retain and add new subscribers, the mobile operators have started offering tariffs as low as half-a-paisa per second.

Asked whether tariffs be regulated, Kohli said, "tariffs have to be sustainable in the long-run. TRAI should definitely look at predatory pricing, that is tariff lower than the cost structure of operators".

Eight new mobile operators have started or about to start services in the country. Telecom Minister A Raja had said that mobile tariffs should come down to 10 paise for local calls and for 25 paise STD calls per minute.

Kohli, however, expressed concern about high rate of taxes and levies being paid by telecom operators.

On further scope of tariff cuts, he said, "the next level of tariff cuts would come from the reduction in high taxes and levis which are burdening the telecom users. There are 30-31 per cent tax which the users have to bear right now". If the tax burden is lowered, tariffs would come down further, he said.

Financial Express

Markets choppy, Sensex ends flat

2009-12-03T04:45:00.000-08:00

The benchmark Sensex ended flat in a highly volatile trade which saw the index remaining range bound notwithstanding a good start, amid worries of rising food inflation.

The benchmark index of the Bombay Stock Exchange Sensex, which had lost 28 points in previous session, recovered by 15.77 points in late trade to close the day at 17,185.68 points, after moving between 17,361.27 and 17,128.21 points.

While the positive factors like firm Asian and European markets and Goldman Sachs' forecast of a faster growth for the domestic economy kept the market in better shape during the day, a rise in food inflation capped the gains towards the last hour trade. Food inflation has touched 17.47 per cent in the third week of November.

In similar fashion, the wide-based National Stock Exchange's Nifty edged up 8.45 points to close at 5,131.70 points. It moved between 5,181.00 and 5,106.60 during the session.

Among the 30 Sensex stocks, 18 closed higher and 12 ended with losses. Major supporters to the market were the counters in the healthcare, metals, realty, oil and gas and power segments, while the auto and capital goods sectors were down on emergence of profit-selling.

A fall in heavy-weight stocks of Infosys Technologies, ICICI Bank, Tata Motors and, Reliance Infra and Jaiprakash Associates mainly pulled down the market.

Financial Express

Soon, your cell phone number may have eleven digits

2009-12-02T01:21:00.000-08:00

All 500 million mobile users in the country may have to change their phone numbers from January 1, 2010, and adopt a 11-digit cellular number if a DoT proposal is accepted by the industry. But, all leading operators said that it would be ‘next to impossible’ for the country to move to a 11-digit mobile number by January 2010 as this would involve making massive technical changes to both softwares and mobile network configurations, while adding that this process could take up to 12 months.

The DoT has prepared a draft notification in which it wants all mobile users to adopt a 11-digit numbering plan by pre-fixing ‘9’ to their existing cellphone numbers. A DoT official said that the country will eventually have to move to a 11-digit cellular numbers system.

The logic: Under the current 10-digit numbering scheme, only a maximum of one billion mobile numbers can be issued and the mobile connections in the country will cross this mark in the next couple of years. Pre-fixing an additional digit will allow the Indian telecom operators to issue up to 10-billion individual mobile numbers.

The existing numbering plan that was fixed in 2003 was expected to be in place till 2030. This is because, based on 2003-projections, India was expected to touch 500 million mobile customers only by 2030, but the country has reached this mark 21 years ahead of the projected date. India has been the world’s fastest growing cellular market for the last three years. Thirteen mobile phone firms are jostling for space in the Indian market that most analysts feel can support only 4-5 operators. India is adding an average of 15 million new cellular customers every month.

When contacted, all service providers denied having received any ‘formal’ notification to move to 11-digit mobile numbers from January 2010. “The proposal to migrate to 11-digit numbers from next year has been under discussion for a long time, but the government and telecom companies have not reached any consensus,” a top executive with one of the country’s largest operators said.

“It is impossible to migrate before January 2010 because all telecom networks have to be reconfigured. We also have to change all roaming agreements, both within India as well as with other telcos globally. Termination and interconnection agreements with global operators must also be changed so that incoming calls from abroad are directed to the new numbers and therefore the entire process will take about 10-18 months,” added the chief technological officer of a pan-India operator.

While the country has only about 500 million cellular customers, an industry analyst said that operators have already exhausted about 800 million cellular numbers. “A significant bulk of mobile phone users have changed their mobile operators over the last couple of years and some customers have done multiple changes — this has rendered these mobile numbers useless as most telcos discontinue a number that has been allotted once,” explained an industry executive.

The regulatory head with a telco pointed out that a lot of numbers were wasted in India because it was very cheap to get a new connection here. “There is no reward for refund. Numbers are not treated as a scarce resource. In most countries, governments are a little bit cautious before doling out huge numbers. If we had deposits on numbers, then people would cancel non-used numbers to get that deposit back. About 20% of numbers that have been allotted have not been used,” this executive added.

Economic Times

MTNL launches per second billing

2009-12-02T01:15:00.000-08:00

State-run telecom service provider Mahanagar Telephone Nigam Ltd (MTNL) has announced per second billing scheme for its 2G and 3G customers in the Delhi and Mumbai circles.

Under the plan, calls made within the MTNL network will be charged half paise per second, while calls to other networks across the country will be charged one paise per second, the company said.

MTNL will also provide video calls across its 3G network for one paise per second.

Text message rates have also been reduced to 25 paise for local, Re.1 for national and Rs.2.50 for international messages.

"Our pay-per-second plan is the most affordable and shall benefit 4.4 million mobile customers of MTNL, including about 165,000 3G customers," MTNL chairman and managing director R.S.P. Sinha said.

The company's move comes after other telecom majors such as Tata Teleservices, Bharti Airtel and Reliance Communications launched per second billing systems.

Times of India

Car sales post double-digit growth in Nov; Maruti leads

2009-12-02T01:09:00.000-08:00

Carmakers continued to see double-digit sales growth in November, helped by last year’s low base effect, when car sales had plummeted

to its lowest level on negative customer sentiment impacted by the global financial meltdown. Even though November sales dipped from the previous month, car companies are bullish that the double-digit growth will continue for the rest of the fiscal.

Car sales had dipped 19.38% to 83,059 cars in November 2008 over 1.03 lakh cars sold in the same month of November 2007. Auto sales had started to grow from December last year, after the government cut excise duty by 4% on all vehicles under its stimulus package that revived demand and brought sales back on positive charts. This apart, the decline in interest rates helped revive car sales in the past one year, which peaked during the festive months of October, during which 1.6 lakh cars were sold.

Market leader Maruti Suzuki India continued to hold the sales momentum, recording 60% jump in sales to 76,359 cars. The major push came from the fast-growing hatchbacks Alto, WagonR, Estilo, Swift, A-Star and Ritz, which also witnessed 60% growth to 56,005 cars last month. Sales of the company’s erstwhile flagship brand, the M800, also grew 32% to 3,040 cars.

Korean carmaker Hyundai’s domestic sales jumped 93% to 28,162 cars in November compared with the same month last year. The company posted its highest increase in its decade-old operations last month. Hyundai senior vice-president (marketing & sales) Arvind Saxena said, “The base effect of lower sales last year has led to a major jump in numbers but the overall economic scenario has changed in the past one year and translated into more footfalls in our showroom.”

Tata Motors’ sales jumped 48% to 18,480 while Fiat’s sales grew six times to 1,965 cars. Utility vehicle maker Mahindra & Mahindra (M&M) saw its sales double to 15,193 units in November. The major push came from SUVs Scorpio, Xylo and Bolero its Sedan Logan continued to get muted response selling 279 cars last month compared with 300 cars in the year-ago month.

General Motors India, a wholly-owned subsidiary of troubled American car maker General Motors, reported its highest jump in sales at 65.27% to 7,118 cars against 4,307 sold in the same month last year. Honda Siel Cars India (HSCI) posted a marginal 2% increase in sales to 5,125 cars.

Two-wheeler sales were largely pushed by market leader Hero Honda, which sold 3.81 lakh two-wheelers last month, an increase of 32% over last year. “With the highest ever sales in November, we have crossed 3 million in the current fiscal. We will cross our target of 4 million two-wheelers much before the fiscal closes,” Hero Honda senior VP (marketing & sales) Anil Dua said.

Chennai-based two-wheeler company, TVS Motors, posted a 37% increase to 1.06 lakh two-wheelers. The increase came from higher demand for scooters, sales for which rose 38% to 25,000 units while motorcycle sales marginally declined to 45,080 units in November compared with 45,276 units sold in the same month last year.

Fringe players in the two-wheeler industry like Suzuki Motorcycle India posted a 48% growth in sales in November to 14,745 units while India Yamaha Motor grew 2.12% to 17,055 units last month.

Reliance Gas Price Offered to NTPC Needs India Government

2009-12-02T01:03:00.000-08:00

India's federal government said Wednesday that the price of natural gas offered to state-run power producer NTPC Ltd. by Reliance Industries Ltd. requires the government's approval under the production sharing contract.

"The central government will take an appropriate decision in the case of NTPC as and when a need arises," Gopal Subramanium, a government lawyer, said in his statement to a three-judge bench of the Supreme Court of India.

The court is hearing a legal dispute between RIL and Reliance Natural Resources Ltd. over the pricing of natural gas from the eastern offshore D6 block in the Krishna Godavari basin.

RIL is also locked in a separate legal battle with NTPC in Bombay High Court. NTPC says it has a right to buy 12 million metric standard cubic metres of gas per day at $2.34 per million metric British thermal units under the terms of a tender floated in 2002-03 and won by RIL.

The wall street journal

Sensex adds 294 pts on robust GDP data

2009-11-30T07:52:00.000-08:00

The Bombay Stock Exchange benchmark Sensex snapped the two-day 3.3 per cent losses on Monday, to close with a significant gain of over 294 points or 1.71 per cent, driven by the more than expected GDP growth at 7.9 per cent amid easing tension in the Dubai debt crisis.

The Sensex, which had lost 223 points on Friday on the Dubai bubble, recovered to close with a gain of 294.21 points to 16,926.22 soon after a report showed the economy grew by a significant 7.9 per cent in the second quarter of this fiscal, up from 6.1 per cent in the previous quarter. This is the fastest GDP growth in over 18 months.

The Benchmark touched the day's high of 17,026.91 during the day, as 26 of the 30-BSE Sensex counters closed higher and four ended lower.

The wide-based National Stock Exchange index Nifty also rose by 90.95 points to 5,032.70 with heavy-weight stocks recording handsome gains. The Nifty touched the day's high of 5,066.35.

While firming trend in Asian markets supported the Sensex to some extent, a weak European open capped the gains.

The market rebounded as most battered sectors like metals, IT, banks and realty gained the most on Monday.

With the buying activity spilling over a wide-front, smallcap index rose by 2.08 per cent to 7,522.98 and midcap index by 1.63 per cent to 6,415.47.

Financial Express

Economy will return to 9 per cent growth soon: India Inc

2009-11-30T07:46:00.000-08:00

India Inc is upbeat about the "higher than expected" growth of gross domestic product (GDP) in the second quarter this fiscal and

expects the economy to return to 9 per cent growth soon.

"It only shows the resilience of the Indian economy, which can remain insulated from global shocks of the most troubled times and yet achieve such a growth rate," said Swati Piramal, president of the Associated Chambers of Commerce and Industry (Assocham).

Official data released Monday showed that the country's GDP expanded 7.9 per cent in the second quarter this fiscal, up from 6.1 per cent in the first quarter.

The bulk of the recovery was led by a 9.2-per cent growth in manufacturing, while mining and construction activities expanded by 9.5 per cent and 6.5 per cent, respectively. But the agriculture sector continued to be a major drag with a mere 0.9-per cent growth.

"Agriculture and its related sectors still remain grey areas and a matter of serious concern, as growth is hardly happening in them," Piramal said.

According to the Federation of Indian Chambers of Commerce and Industry (FICCI), the latest GDP figures "are a further confirmation of the Indian economy's recovery".

"At this rate, we feel we can look to a near 7 per cent growth for the whole year," FICCI president Harshpati Singhania said.

"This spurt in GDP growth is remarkable because it comes despite the poor performance in the agriculture sector."

However, the FICCI president said the situation in the second half should be watched closely "as agriculture is likely to lag behind and commodity and energy prices are on the rise".

Economic Times

Edible oils extend gain on global cues

2009-11-28T20:15:00.000-08:00

Extending its upward march for the fourth straight week, edible oils recorded further gains on the wholesale oils and oilseeds market on the back of rising demand from vanaspati millers and retailers, driven by marriage season and firming global trends.

However, non-edible oils moved in a tight range in the absence of any worthwhile activity and settled around previous levels.

Markets remained closed on Saturday on account of "Id-ul-Zuha".

Trading sentiments remained firm as Malaysian palm oil rose for the fourth week in a row to the three-month highs on signs that global demand for edible oils continues to strengthen.

Meanwhile, palm oil futures for February-delivery settled higher at 2,482 ringgit (733 dollar) a tonne on the Malaysia Derivatives Exchange, the highest close since August 13.

Marketmen said apart from firming global trends, increased buying by vanaspati millers and retailers on account of marriage season also led to rise in wholesale edible oil prices in the national capital.

Indian express

Gold rises by Rs 90

2009-11-28T20:12:00.000-08:00

Gold prices rose by Rs 90 per 10 gram and silver rates jumped by Rs 600 a kg in the bullion market here on fresh buying today, a day after the precious metal crashed on concerns over Dubai debt crisis.

Gold rose by Rs 90 to Rs 17,940 per 10 gram. Silver surged by Rs 600 to Rs 28,600 per kg.

Marketmen said fresh buying by stockists and the current marriage season demand kept the prices of precious metals at high levels.

They said gold prices crashing in the previous session after Dubai debt problem attracted stockists and retail customers.

Gold yesterday declined sharply by Rs 300 following a steep fall in prices overseas on fears of a widespread default after Dubai said it would ask creditors of conglomerate Dubai World for a debt moratorium of at least six months.

In the domestic market today, standard gold and ornaments gained Rs 90 each at Rs 17,940 and Rs 17,790 per 10 gram respectively. Sovereign surged by Rs 370 to Rs 13,970 per piece of eight gram.

Silver ready rose by Rs 600 to Rs 28,600 per kg and weekly-based delivery by Rs 615 to Rs 28,165 per kg. Its coins also gained Rs 100 at Rs 34,300 for buying and Rs 34,400 for selling of 100 pieces.

Indian express

Dubai crisis not to impact India much, says FM

2009-11-28T20:07:00.000-08:00

Allaying fears of increased economic turbulence following the Dubai debt crisis, finance minister Pranab Mukherjee said on Saturday it was too early to press the panic button.

While Mukherjee said in the long term, the current crisis would not have much impact on the Indian economy as “the amount is small and the exposure of our banking system is limited in Dubai”, he said an immediate adverse effect could hit home in the form of job losses.

“The immediate adverse effect could be the repatriation of foreign exchange and joblessness of the workforce there. As many as 42.3 per cent of the total population in Dubai is of Indians and Indians; Pakistanis and Bangladeshis combined comprise two thirds of Dubai’s total population. The impact of the crisis is yet to be ascertained,” the finance minister told reporters after he delivered the Haksar memorial lecture here. He said it would be too early to talk of any assistance packages for the workforce as the situation needed to be watched carefully.

While the stock market felt the impact and closed in the red for two days in succession, the finance minister said “no earth-shaking impact” would be seen, especially on exports and FDI inflows.

Earlier, speaking on “Asian economy after the financial crisis: an overview” at CRRID here, Mukherjee said the worst seemed to be over in the context of the global economic downturn but countries could not drop their guard yet as risks remained. “I genuinely believe that as the global economy begins to pull itself out of the crisis, Asia looks set to emerge from the downturn sooner and stronger than any other region,” he said.

The finance minister observed that among the developing countries, in terms of the impact of the crisis, South Asian economies appeared to have been the most resilient so far. “Due to the recovery led by China, East Asia is expected to grow at 4.4 per cent in 2009 and 7.1 per cent in 2010. South Asia is expected to grow at 5.6 per cent in 2009 and 6.4 per cent in 2010,” he said.

Mukherjee remained confident that despite the effects of the slowdown and a poor monsoon, the Indian economy would grow between 6 to 7 per cent this fiscal.

He was however quick to add that even as the economy had entered the recovery mode, care would be taken in withdrawing the stimulus extended to spur demand.

“While an early exit from stimulus measures may hamper the nascent economic recovery, keeping these in place for long may overheat the economy,” he said.

Indian Express

Recession and debt dissolve Dubai's mirage in the desert

2009-11-28T20:04:00.000-08:00

At the end of October, the government of Dubai issued a prospectus to promote a $2.5bn Islamic bond, which contained a little-noticed but important clause.

In it, the government and the ruling family appeared to distance themselves from the state-owned companies behind Dubai's outlandish building boom and an acquisition spree that had included P&O, the British ports operator, department store Barneys New York and part of the firm that owns the London Eye. "The Dubai government," it said, "is under no obligation to extend support to any government-related entity". In other words, these companies, led by the largest, Dubai World, which benefited from implicit government guarantees when they were raising huge amounts of debt from western banks, were already being cut adrift.

The announcement on Wednesday that Dubai World, shouldering almost $60bn (£36.5bn) in debt, would seek a six-month moratorium on repayments sent shockwaves through world markets. Just hours earlier, the government, run by Sheikh Mohammed bin Rashid al-Maktoum, had raised $5bn from two banks for its own debts.

If anywhere is emblematic of the debt-fuelled extravagance of the past decade, it is surely Dubai, which strove to have the tallest, the biggest and the best of everything. If it collapsed, it would have profound effects on other emerging nations, the relationship between the west and the Middle East, and the ownership of scores of well-known businesses. In the worst case, it could wreck fragile confidence and pitch the world back into recession.

Dr Christopher Davidson, an expert on the region at Durham University, says that sovereign debt could be the credit crisis of the emerging markets. "It will make investors sit bolt upright. If Dubai can go down, perhaps others can as well. People might decide that markets like Dubai, where the governments are not fully transparent, are not worth a punt any more."

He says investors have been especially spooked because the Dubai ruler and officials had maintained in recent weeks that everything was fine. "They were just buying time until they could get a bailout from somewhere. The ruler has suffered a massive loss of legitimacy in the eyes of the business community. During the boom years, there was no separation between the government wealth and the companies' wealth – they were creaming it off. They can't now have it both ways." The sheikh, he says, could end up as "the most bankrupt person in the world".

Will Hadfield at the Middle East Economic Digest says there is widespread anger at the manner of the announcement, which came after markets in the Middle East had closed and at the start of the Eid al-Adha holiday. "There was an arrogance in making the biggest announcement to investors in years just when everyone was packing up for the holiday weekend."

The warning signs have been coming for some time. Property prices in the emirate had fallen 50% from their peak and follies including a set of man-made islands in the shape of the world map have been left half-built. According to the Bank for International Settlements, banks have claims totalling $123bn on debtors in the United Arab Emirates, $88bn of which are held by European banks and $50bn by UK banks alone.

There had already been signs in Britain, where it owns huge swathes of assets, that Dubai was unravelling. Last month Dubai World's investment arm, Istithmar World, sold two London properties – Marcol House in Regent Street and an office building in Newman Street – for a knockdown price of £10m. Istithmar had bought the properties for £90m, but was forced to sell when it found itself unable to pay the interest on a loan.

The ports division of Dubai World has also been reviewing its £1.5bn London Gateway Port project, some 25 miles east of central London, and last week secured a £300m rescue loan from the European Investment Bank.

Concerns have also been raised about the state of Travelodge, which is controlled by another investment business owned by Sheikh Mohammed, Dubai International Capital. Matthew Oakeshott of investment managers OLIM says: "Property investors are beginning to worry about companies like Travelodge which are backed by investors based in Dubai. They have been expanding very rapidly and a flood of their properties have hit the market recently." DIC claims to be unaffected by the crisis.

A deal with Dubai World for celebrity chef Jamie Oliver to build two restaurants at the Jumeirah Golf Estates and design kitchens for many of the homes in the area, which had no set budget limit, has also been cancelled.

Much will now depend on Abu Dhabi, Dubai's oil-rich neighbour, which will be concerned for the wider reputation of the United Arab Emirates. "Everyone is surprised that Abu Dhabi has allowed it to get to this stage," says Hadfield. "Abu Dhabi could easily afford to pay off its debts, but it could be that they want some of the more attractive assets in return – namely the ports business and the airline Emirates. Abu Dhabi and Dubai don't do each other any favours – Abu Dhabi sees Dubai as reckless and way too flashy. It will have to step in at some point. But presumably they want to extract a price."

Stephen Lewis of Monument Securities says clearing up the bad debts hidden throughout the world's financial system will put the brakes on recovery for a long time. "The latest Dubai problem is typical of the obstacles that stand in the way of sustained economic expansion, while the financial situation remains fragile," he says. "In simple language, the Dubai crisis is symptomatic of an economic depression."

As global investors wake up to this reality, he adds, "it would not take many more stories like that from Dubai to crack global confidence in paper assets."

After an explosive rally since March, many analysts were already warning that world equity markets looked overvalued. "Here we are now, four and a bit weeks from year-end, and there would be a desire to lock in profits. What Dubai does is accelerate that process," says Nick Parsons of NAB Capital. "Markets are going to be hugely volatile."

Guardian.co.uk

Six infra industries expand by 3.5%

2009-11-27T10:27:00.000-08:00

India's key infrastructure industries rose by 3.5 per cent in October on better performance by petroleum refinery products, electricity and finished steel.

The six infrastructure industries, which account for a quarter of the nation's industrial production, registered 2 per cent growth in October 2008.

Petroleum refinery products grew by 7.2 per cent in October compared to 5 per cent in the same month last year, as per the data released by the government.

In case of electricity and finished steel (carbon), the growth was 4.7 per cent and 1.1 per cent, respectively.

The index for the six key industries rose to 254.8 in October from 246.3 a year earlier, the data said.

During April-October this year, the six infrastructure sectors rose by 4.7 per cent better than 3.3 per cent in the year ago period.

Except for crude oil which posted negative growth of 2.2 per cent, all other key industries posted positive growth.

Cement grew by 5.3 per cent against 6.2 per cent in the same period last year.

Among other components of the six key industries, coal output stood at 5 per cent in the reviewed period.

However, on sequential basis since August, when the core industries grew by 7.8 per cent, it has been on a decline. For the September month, the index rose by 4.1 per cent and in October growth was 3.5 per cent.

Financial express

Rel Capital to acquire Quant Capital

2009-11-27T09:59:00.000-08:00

Anil Ambani group's financial services arm Reliance Capital said it will acquire brokerage and equity research firm Quant Capital, but did not disclose the financial details of the deal.

Following the acquisition, operations of Quant Capital would be integrated with that of Reliance Equity International Ltd, a wholly owned subsidiary of Reliance Capital.

Quant Capital, which was incorporated in December 2007 and began operations in May 2008, employs over 100 professionals and has signficant presence in both the foreign and domestic institutional markets.

"Reliance Capital proposed to take a majority stake in Mumbai-based Quant Capital Group. The existing management team at Quant Capital will continue to be responsible for its operations," the Anil Ambani group firm said in a statement.

When asked about financial details of the deal, a company spokesperson declined to comment.

Financial Express

L&T has 6,000 mw power projects

2009-11-27T09:29:00.000-08:00

L&T has 6,000 MW power projects on hand and they are at various stages of implementation, Chief Executive Officer and Managing Director of L&T - Power, Ravi Uppal said.

Talking to PTI, Ravi Uppal said, "Generation of solar energy in large megawatts is very costlier affair and it requires research."

He said that L&T has been concentrating on coal-based and gas-based power projects.

Financial express

Sensex closes 223 points down

2009-11-27T09:20:00.000-08:00

The Bombay Stock Exchange benchmark Sensex rebounded from the day's low and closed down 223 points on nervous selling by funds as concerns about Dubai's debt problems rattled markets around the world.

The Sensex, after dipping nearly 600 points during the day, settled lower by 222.92 points at 16,632.01 points as funds remained aggressive sellers in realty, banks and IT segments.

In similar fashion, the wide-based National Stock Exchange's Nifty touched the day's low of 4,806.70, ended with a loss of 63.80 points at 4,941.75.

Stocks, currency and bonds also fell as investors shied away from riskier emerging market assets over losses stemming from Dubai World’s attempt to reschedule its USD 59 billion debt.

The rupee and bonds retreated, with the currency joining stocks in posting its biggest drop in more than three months, brokers said, and added the US dollar rebounded to edge over the rupee over Rs 47 was a magic change.

In the 30-share Sensex, 25 closed with heavy losses while five were higher on investment buying. These were Bharti Airtel, Grasim, Hero Honda, Reliance Infra and Tata Steel.

Financial express

Tata Consultancy Services to go slow on hiring

2009-11-27T09:06:00.000-08:00

IT services behemoth Tata Consultancy Services (TCS), which had offered jobs to as many as 24,885 graduates last year, is likely to go slow on its recruitment plans this year.

"The figure will not be as high as that of last year and also not very less," TCS vice-president and global HR head Ajoy Mukharjee told reporters here on the sidelines of Sangam, the company's annual academic conclave.

In 2008, the largest IT services company had made job offers to as many as 24,885 graduates in campus recruitment, of which 12,000 candidates are yet to be absorbed. It plans to make job offers to 8,000 graduates this quarter, the process for which would begin in December.

Replying to a question on the salary hikes and other incentives to the staff, TCS CEO and MD N Chandrasekharan said they are still working out the packages for the next year. This year the company did not give any hikes other than that of performance-linked variable incentives.

About the attrition rate, Chandrasekharan said it was11.5 per cent last year with a head count of 1.41 lakh globally.

Reacting on the Dubai financial crisis, he said the company's exposure to the Dubai market is very less and there will not be any impact.

"The TCS Research Scholars programme will help enlarge the R&D agenda and encourage exploration of new ideas by funding candidates in doctorate programmes," Chandrasekaran said, adding they would fund 200 doctoral candidates over five years to take up PhD programs in various subjects.

Economic Times

Sensex tanks 344 pts on heavy selling

2009-11-26T10:22:00.000-08:00

The Bombay Stock Exchange benchmark Sensex on Thursday sharply declined by 344 points on heavy selling by funds on expiry of current month contracts in the derivatives segment amid weak global cues.

The 30-share index plunged by 344.02 points to close at 16,854.93 points, recording the biggest fall after November 3.

The key index moved between 17,202.51 points and 16,808.87 points during the day as investors offloaded pending positions on expiry of the November month contract in the derivatives segment.

The wide-based National Stock Exchange index Nifty fell by 102.60 points to 5,005.55 points, after touching the day's low of 4,986.05 points.

Selling pressure was more confined to banking, oil and gas, consumer durables, realty and IT stocks.

Reliance Industries, the heaviest on the Sensex, fell 3.6 per cent after the stock was converted into ex-bonus. IT major Infosys fell by 1.92 per cent, while largest private lender ICICI Bank declined 3.74 per cent. The three stocks carry more than 27 per cent weightage on the benchmark.

In the 30-BSE index stocks, 26 scrips closed with losses.

A weakening trend in Asian markets and lower opening in the European markets also weighed on investors sentiment.

Hong Kong's Hang Seng index declined 1.78 per cent after heavy fall in Chinese shares, while Singapore fell by 1.10 per cent. The Japanese Nikkei dipped 0.62 per cent to close at four month low after yen's sharp rise against dollar.

Financial Express

Tata Steel Q2 consolidated net loss at Rs 2,719-cr

2009-11-26T10:19:00.000-08:00

Tata Steel Group on Thursday reported a net loss of Rs 2,719.8 crore for Q2 FY'10 as against a net profit of Rs 4,771.65 crore in the same quarter last fiscal owing to lower price and production of the alloy and the poor show at Teesside Cast Products plant (TCP) in England.

"Lower price and production are the reasons for the company's net loss. But, the primary reason will be TCP, which adversely impacted the EBIDTA by around Rs 800 crore for the quarter alone," Tata Steel Group Chief Financial Officer Kaushik Chattejee said here Thursday.

Tata Steel, however, is pinning hope on increased sales to see "a trend reversal" in the second half of the current fiscal as it anticipates "stability in price" and no likelihood of raising the capacity utilisation level, from 75 per cent now, at its European operation.

"The capacity utilisation at Europe is likely to continue at the same rate in the remaining period of the current fiscal," Tata Steel Europe's Managing Director and Chief Executive Officer Kirby Adams said.

Tata Steel Europe returned to the positive EBIDTA level in October, Adams said, hoping that it would remain positive in the third and fourth quarters of the current fiscal as well due to volume growth and cost reduction.

While production at Tata Steel Europe was at 7.1 million tonnes in H1 FY'10 as compared to 12 million tonnes in the same period last fiscal, Tata Steel India had produced 3.14 million tonnes in the first half, up from 2.61 million tones in the first half of the previous fiscal.

Revenue at Tata Steel Europe increased to USD 3.5 billion in the second quarter as compared to USD 3.2 billion in the first quarter. It's revenue was at USD 6.7 billion in the first half, down by 51 per cent as compared to USD 13.7 billion in the same period last fiscal.

The Group's total turnover was at USD 5.2 billion in the second quarter ended September 30, 2010 as against USD 4.8 billion in the first quarter of the current fiscal.

On TCP, Adams said the company was in the process of finalising a long-term plan for the plant, in which the options of redevelopment, mothballing or joint venture redevelopment were open.

However, he said that TCP was likely to break even in the current quarter.

Financial express

Food inflation rises to 15.58 pct

2009-11-26T10:15:00.000-08:00

Food inflation rose to 15.58 per cent for the second week of November from 14.55 per cent in the previous week as potatoes and pulses turned costlier.

On an annual basis, potato prices more than doubled, pulses became expensive by over 35 per cent, while onions rose by 27 per cent.

Price rise was significant on weekly basis with urad and poultry chicken rising by 15 per cent each, eggs by 8 per cent, moong by 6 per cent, arhar by 5 per cent and fruits & vegetables by 3 per cent.

Among the non-food articles, raw silk turned expensive by 3 per cent, while fodder and groundnut seed by 2 per cent each.

Fuel index though remained unchanged at the previous week's level.

Financial Express

Tata Steel: Disappointing performance

2009-11-26T10:05:00.000-08:00

The losses can be attributed to costlier raw material, higher restructuring cost and operating pressure at its Teesside operations.

Tata Steel shares tumbled almost 6 per cent to Rs 529.15 today as the company reported a consolidated loss of Rs 2,720 crore for the September quarter, which was significantly higher than the loss of Rs 1,200 crore estimated by analysts.

Consolidated loss per share stood at Rs 64.58 for the six months ended September 2009. Falling steel prices and lower volumes led to a 43 per cent decline in Tata Steel’s consolidated net sales to Rs 25,395 crore.

The losses can be attributed to costlier raw material, higher restructuring cost and operating pressure at its Teesside operations. Teesside Cast Products (TCP), which contributed almost 35 per cent of the consolidated losses during the first half of the current financial year, lost all its long-term customers, who cancelled their purchase contracts with the company due to the sharp fall in prices and lower demand.

Going ahead, Tata Steel’s management expects the business environment to improve and hopes to report a turnaround in its performance in the second half of the financial year. Cost of production is expected to be lower consequent to depletion of high-cost raw material inventory, whereas new purchases are being done at lower prices.

The company reported an improvement in capacity utilisation to 75 per cent from 53 per cent in the June quarter, which saw its sales deliveries rise to 3.9 million tonnes from 3.2 million tonnes on the back of higher demand from the construction sector in the European markets. The improving capacity utilisation level should also add to its gains on account of economies of scale in the coming quarters.

On the demand front, the management believes that South East Asia and Indian markets are growing, whereas the European and the US markets are stabilising. In the coming quarters, the company will also benefit from its plan to prepay about $2 billion debt.

Its overall performance is, therefore, expected to improve in the second half of the current financial year, which analysts say will help reduce the loss to Rs 15-20 per share for the full year.

Business standard

HCL Technologies bags $200-m deal from UK firm

2009-11-23T18:57:00.000-08:00

HCL Technologies said it has bagged a long-term deal worth about $200 million from UK-based insurance firm Equitable Life Assurance Society.

“The contract is ‘evergreen,’ it is for a period of 30 years. The revenue from the deal will come (mostly) in the first five to six years and decline gradually as policies decline,” HCL Technologies’ senior vice-president Stuart Drew said on Monday. The deal has been awarded to HCL Insurance Business Services, the IT firm’s UK-based life and pensions administration business.

Currently, about 340 people are servicing the account. “We expect about 100 people will be taken in by Equitable Life, rendering about 240 people surplus. They will be relieved under suitable schemes,” Equitable Life Chief Executive Chris Wiscarson said.

“HCL will take care of the work of these 240 employees, with about 50-70 jobs being taken care of from HCL’s Chennai centre,” he added. As part of the deal, HCL will provide complete solutions, including policy administration, finance, actuarial services, IT operational support and call centre services.

Economic Times

RIL shares rises to 1-month high

2009-11-23T18:52:00.000-08:00

Shares in energy major Reliance Industries rose to one-month highs on Monday as traders said its offer for bankrupt petrochemicals company LyondellBasell Industries was well timed and would help its core businesses.

Over the weekend India's Reliance said it had made a cash offer to buy control of LyondellBasell.

A deal would create one of the largest petrochemical firms in the world, and comes when valuations are still low following the global downturn and Reliance is cashed up, analysts said.

Sources have put the value of the deal at around $10 billion to $12 billion, which would be India's second-biggest ever foreign takeover. In 2007, Tata Steel bought Corus for $13 billion.

However, the deal differs from other big overseas deals given the relative size of companies, balance sheet strength and bankruptcy status of the LyondellBasell, Goldman Sachs said in a research report.

"We have been noting that Reliance could pursue inorganic growth as we see no major projects lined up to consume about US$20 billion of excess cash flow for FY2011 to FY2014 after its committed capex," Goldman Sachs said.

It would also mark a return of Indian firms to large-scale M&A, after the global credit crunch and economic downturn made it difficult for firms such as aluminium maker Hindalco and Tata Motors, which bought Jaguar Land Rover, to digest big deals made in 2007 and early 2008.

At 0625 GMT, Reliance, which has a 14 percent weighting in the main Mumbai index, was up 3.1 percent at 2,191 rupees. The main index gained 0.8 percent.

Reliance is India's largest conglomerate with interests in petrochemicals, refining, oil and gas exploration, and retail.

STRONG CASH POSITION

Reliance, which has a market value of $75 billion, has been looking to take advantage of low valuations to expand internationally. Analysts said it has more than required muscle to finance the deal.

It has $4 billion in cash, $8 billion in treasury stock that can be sold, and, if it doubled its current net debt-to-equity it could borrow another $10 billion, Macquarie said in a recent research note.

A deal would give Reliance greater bargaining power in sourcing, and a strong presence in the United States and Europe, and technology patents.

"The deal is not going to be negative prime facie, that is obvious. The only concern is what could be the drag on Reliance's profits but that is offset by the global presence and others," said Deven Choksey, chief executive at brokerage KR Choksey. Reliance is aiming to attain global scale for its conventional energy platform - petrochemicals, refining and oil and gas exploration - and invest in its new businesses such as retailing and alternative energy, chairman Mukesh Ambani said last week at the annual meeting of shareholders.

Indian Express

Maruti to launch van to replace Versa

2009-11-23T18:47:00.000-08:00

The country's largest car maker, Maruti Suzuki India (MSI), on Monday said it will launch a new van within this fiscal to replace its MPV Versa, whose production has been stopped.

"We will be launching a new van by the end of this fiscal. This vehicle will replace the Versa, whose production has already been stopped," Maruti Suzuki India Managing Executive Officer (Engineering) I V Rao told reporters on the sidelines of the Fourth Environmentally Friendly Vehicle Conference here.

He, however, did not give the price point of the soon-to-be launched vehicle.

MSI is also looking to produce one million vehicles by the end of this fiscal.

"Hopefully, we will have one million units in production by the end of this financial year by utilising our full capacity," Rao said.

He added the company is working on making all its models Bharat Stage-IV compliant as required under the government norms.

"We have not completed BS-IV compliance norms on all our models but we are working towards that direction," Rao said.

The company is also working on hybrid and electric vehicles for demo cars, but Rao said it has no plans for a full-fledged launch of vehicles with such alternative fuel technologies.

Indian Express

Mahindra eyes Rs 500 crore turnover

2009-11-23T18:44:00.000-08:00

Mahindra and Mahindra, which entered into the business of sale of pre-owned cars in 2007, is eying the turnover of Rs 500 crore in the current fiscal.

"Market of sale-purchase of pre-owned cars was at least 20 times big than the market of new cars and we want to tab the market to double our current Acquired Turn Over of Rs 250 crore in the current financial year," Sharad Agarwal, General Manager, Sales (North) of the Mahindra First Choice Wheels Ltd, a wing of Mahindra and Mahindra, told reporters while inaugurating a showroom of the company.

At present the company had 97 dealers in the country, which would be increased to 300 by 2013 apart from opening 27 super showroom for sale-purchase of at least one lakh cars, he added.

"The newly opened showroom of the company will display several brands of pre-owned cars and will function as a one-stop shop for all those wishing to either buy or sell a car. We will offer a wide range of services for customers, including purchase and sale of pre-owned cars, car finance and insurance, fitment of car accessories and assistance with paperwork and documentation," said Agarwal.

Indian Express

Sensex extends gains, up 158 pts

2009-11-23T18:40:00.000-08:00

The benchmark Sensex rose by 158 points to close at a five-week high after strong gains in market leader Reliance Industries counter and positive cues from global markets.

The country's largest private sector company Reliance Industries led the rally as the scrip gained 3.31 per cent after it had said last week that it had submitted a bid to acquire the world's third-largest petrochemical company LyondellBasell.

The Bombay Stock Exchange barometer settled at 17,180.18 points, a rise of 158.33 points over previous close. The 30-share index had risen by 236 points in the last session.

Brokers said investors remained bullish and rolled over positions to next derivatives series ahead of the expiry of November contract on Thursday, supporting the uptrend.

European markets gained up to 1.70 per cent in early trade on signs about the economic recovery gathered pace.

Asian markets were broadly higher with Hong Kong's Hang Seng index closing up by 1.41 per cent and the Shanghai Composite Index by 0.92 per cent.

Tata Steel, which enjoys more than 2 per cent weightage in the Sensex formation, also spurted by 3.92 per cent after metal prices surged further on the London Metal Exchange over the weekend.

Indian express

ArcelorMittal looks to set up Rs 20K cr plant in Karnataka

2009-11-23T18:37:00.000-08:00

World’s biggest steel producer ArcelorMittal today announced setting up of another integrated plant in iron-ore-rich Karnataka, thereby taking its total investment in the country to more than Rs 1,00,000 crore.

While projects of global steel tycoon L N Mittal’s company lie stuck in various regulatory and other bottlenecks, besides being hit by tardy progress in land acquisition in Orissa and Jharkhand, ArcelorMittal approached the Karnataka government on Saturday last seeking its nod to set up a steel plant. The plant is estimated to have a production capacity of 6 million tonnes). Though the company’s spokesman did not specify where and when the plant would be set up, informed sources said Bellary district could be the location and that the company was planning to invest about Rs 20,000 crore for the project. The spokesman maintained that none of the existing proposed projects are being relocated. The company’s decision to propose another project in Karnataka comes even as its existing projects are yet to gather steam. ArcelorMittal had already threatened to relocate its projects, forcing the steel ministry to initiate consultations with the company and state governments to expedite projects.

According to a statement from ArcelorMittal the company’s proposed project would depend on a host of techno-economic factors. It has initiated a techno-economic feasibility and details pertaining to cost, capacity, timeline, etc, would be known after its completion in 3-4 months. Going by its plans to invest about Rs 80,000 crore for the two proposed projects totaling 12 million tonne, together with Karnataka project, the proposed investment would be well over Rs 1,00,000 crore.

Indian express

ICICI Bank raises $750 mn through bond issue

2009-11-21T21:39:00.000-08:00

India's second largest lender, ICICI Bank on Saturday said it has raised $750-million through the issue of five-year bonds at its Bahrain branch.

The issue, which had an order book of over $3-billion, was participated by over 250 investors, the bank said in a press release issued here.

"The 5.33 year fixed rate notes carry a coupon of 5.5 per cent, which translates to 292.6 basis points spread over equivalent Libor," the bank said.

Last month, country's largest lender, State Bank of India raised $750-million through the issue of five year bonds abroad.

Financial Express

'India to be 3rd largest economy by 2050'

2009-11-21T21:35:00.000-08:00

India will be the third largest economy in the world after China and United States by 2050, a US-based internationally recognised foreign-policy think tank has said.

An article "The G20 in 2050", carried in November bulletin of the Carnegie Endowment for International Peace said, "China, India, and the United States will emerge as the world’s three largest economies in 2050. Their total GDP, in real US dollar terms, will be over 70 per cent more than that of the other G20 countries combined."

Other main findings include, China will become the world’s largest economy in 2032, and grow to be 20 per cent larger than the United States by 2050. Over the next forty years, nearly 60 per cent of G20 economic growth will come from Brazil, China, India, Russia, and Mexico alone.

The article was written by Uri Dadush and Bennett Stancil. A Frenchman and former director of World Bank, Dadush is the director of the International Economics Programme at the Foundation, and Stancil is a Fellow at the Programme.

"In China and India alone, GDP is predicted to increase by nearly USD 60 trillion the current world GDP but the wide disparity in per capita GDP among these three will persist," they noted.

India's annual average GDP growth between 2009-2050 is predicted to 6.19 per cent, and these emerging markets will not rise among the world’s richest countries in per capita terms- their average income in 2050 will still be 40 per cent below that of the G7 nations presently.

Stressing that the world's economic powers are shifting dramatically, the economists noted that the "G20's recent transformation into the world’s principal economic forum highlights the beginning of a more integrated and complex economic era."

Over the next 40 years, the G20 GDP is expected to grow at an average annual rate of 3.6 per cent, rising from $38.3 trillion in 2009 to $161.5 trillion in 2050, in real US dollar terms.

Nearly 60 per cent of this $123 trillion dollar expansion will come from Brazil, Russia, India, China and Mexico.

The experts also find that out of the G20 countries, "India is predicted to grow most rapidly, but it’s current modest size will prevent it from surpassing either China or the United States in real US dollar terms."

The authors observe that the growth could be even faster, but the low quality of education, infrastructure, governance, and business climate will hold back progress in developing countries. Technological...

Financial Express

Gold rises, silver crosses 29-K level

2009-11-21T21:32:00.000-08:00

Gold prices sky-rocketed to yet another historic peak in the bullion market, sparked by frantic buying spree from stockists and traders amid supportive overseas cues.

Silver too conquered another milestone by crossing over the psychological Rs 29-K level on intense industrial buying.

The white metal achieved the Rs 29,000 mark from Rs 28,000 in short span of just five straight trading session.

Standard gold (99.5 purity) strengthened by Rs 160 per 10 grams to close at Rs 17,455 from overnight closing level of Rs 17,295.

Pure gold (99.9 purity) also rose by a similar margin to end at Rs 17,540 per 10 grams as against Rs 17,380 yesterday.

Silver ready (.999 fineness) spurted by Rs 335 per kg to finish at Rs 29,190 from yesterday's closing level of Rs 28,855.

In the International market, gold futures rose on Friday in New York for a sixth straight session to a new record high.

Gold for December delivery firmed up by USD 4.90 to conclude at USD 1,146.80 an ounce.

However, December silver fell slightly to USD 18.44 an ounce.

Financial Express

Pepsico to set up 4 new plants in India

2009-11-19T04:44:00.000-08:00

Focusing on India as a rapidly growing market, US soft drinks giant Pepsico would pump in an estimated Rs 700 crore to set up four new food and beverages projects by 2012.

Just Days after its high-profile global board meeting that was hosted for the first time in the country earlier this month, Pepsico India Chairman Sanjeev Chadha said "going forward, over the next three years, certainly we will be putting up new plants."

Chadha, who took charge as Pepsico India head three years ago, said there would be three greenfield plants on the beverages side. "On the food side, at least there would be one more plant," he said, but did not specify the quantum of investment involved.

He said on an average it costs around $30 million to set up a beverages plant and around $50-60 million a food plant.

Going by these estimates, Pepsico, whose global operations are headed by India-born Indra Nooyi, may have to shell out around $150 million (Rs 700 crore)to set up these plants. The sites for the plants are yet to be finalised.

"We are in the process of searching and identifying, through a network analysis, as to where the location of these plants would be," he added.

Since its entry in India 19 years ago, the company has invested over $1 billion in the country. This includes $600 million that is being invested.

Chadha said Pepsico is in the process of pumping in around $200 million this year itself.

Currently, Pepsico has 43 soft drinks plants in India, out of which 28 are company owned. It has three plants for the snacks business.

The new plants will be in addition to the expansion that will take place at the existing plants.

Chadha said Pepsico's global board expects the company here to continue with robust growth, which has been tripling every five years.

"We have always talked about tripling our business in five years time and we are consistent about it. If you take any five years, we will be tripling that business in that five years time," he added

"We will be definitely tripling our business (in value) over 2007 to 2012," Chadha said.

Financial Express

Per capita development expenditure lowest in Bihar

2009-11-19T04:40:00.000-08:00

The plan expenditure of the Bihar government led by Nitish Kumar has registered a steady rise with accelerated growth but the per capita development expenditure was the lowest among all states during the 11th five year plan.

"Despite significantly better plan efforts, per capital development expenditure of Bihar is the lowest among all states," the state government told the Chairman of the Planning Commission, M S Ahluwalia in a draft presentation here on Wednesday.

Against the all-state average of Rs 3,049 per capita development expenditure, the state registered Rs 1,446 during 2005-06. Similarly against all-state average of Rs 3,826 and Rs 4,208, Bihar recorded per capita development expenditure of Rs 2,123 and Rs 2,184 during 2006-07 and 2007-08 respectively.

Officials said the target of annual growth rate was 8.5 per cent and investment proposed during the period was Rs 78,481 crore (public) and Rs 1,08,283 crore (private).

The government pointed out that against the projection of Rs 10,200 crore annual outlay during 2007-08, actual outlay was Rs 10,202 crore which mounted to Rs 13,500 crore during 2008-09 and Rs 16,000 crore in 2009-10.

The state's annual plan size during 2009-10 was Rs 19,425.85 crore with the state plan expenditure being pegged at Rs 16,000 crore and sectoral allocations were Rs 4,212.08 crore for infrastructure, Rs 6,066.31 crore for social sector, Rs 5,721.61 crore for others, the officials said.

Showing the expenditure up to October 2009, the government said there had been an overall expenditure of Rs 5,376 crore during the period under review against the plan of Rs 16,000 crore.

In the field of primary education, the state government under its promise for ensuring education for all started CM integrated School Development Scheme. Under the scheme 18,475 schools were opened, 10,727 upgraded, 72,025 additional class rooms constructed and 212,290 teachers appointed.

The student teacher ratio improved to 53:1 till March 2009 against 63:1 in 2004 and the number of school children dropped decreased from 2.5 million in 2004 to one million in March 2009.

All secondary schools upgraded to 10 plus two, 11500 teachers were appointed and new institutions like Chanakya National Law University, Chandragupt Institute of Management, Patna, Indian Institute of Technology, Patna were set up and Aryabhatt Professional University and one degree college in each sub-division was on the anvil.

The state government in its report to Ahluwalia said the BPL population in Bihar stood at 1.98 crore, but the allocations for foodgrains and kerosene being...

Financial Express

Adidas 3Q net income falls 30%

2009-11-19T04:37:00.000-08:00

German sportswear company Adidas AG says its net income fell 30 percent in the third quarter as the company saw sales declines, especially at its sport performance division.

Adidas, based in Herzogenaurach, said Wednesday that net income fell to euro213 million ($315 million) in the July-September period from euro302 million in the third quarter of 2008.

Revenue for the period fell to euro2.89 billion from euro3.1 billion in the third quarter of 2008, a 7 percent decrease.

The company says in its report that “Adidas Group sales are expected to decline at a low- to mid-single-digit rate on a currency-neutral basis in 2009."

Financial Express

Reliance Retail to expand in new cities

2009-11-19T04:35:00.000-08:00

Mukesh Ambani-led Reliance Retail is in the expansion mode and is looking to take its food-to- fashion chains into newer Indian cities as well forge new strategic alliances.

"I am pleased to report that we have done extraordinarily well, despite the tough economic conditions.

Having achieved critical scale, Reliance Retail is now working on expanding its coverage. This expansion would encompass new cities, new markets and new strategic alliances," Reliance Industries Chairman and Managing Director, Mukesh Ambani, told shareholders at the company's 35th Annual General Meeting.

Reliance Retail is an unlisted and wholly-owned subsidiary of energy giant, Reliance Industries Ltd (RIL).

Concurrently, Reliance Retail would focus on continuously innovating to enrich the shopping experience, through customised offers, private labels and 'value-for-money' merchandise, he added.

Reliance Retail today serves over five-million customers in 86 cities across 14 states. The fashion-food-gadgets chain operates nearly 1,000 stores.

"We are developing an ecosystem, which will strengthen our offering, while bringing wealth to our stakeholders, primarily marginal farmers, small transporters and vendors," Ambani said.

Financial Express

Sunglass Hut targets 30 outlets in India by 2012

2009-11-19T04:33:00.000-08:00

The world's largest eye-wear retail chain Sunglass Hut said on Thursday that it is looking to take the number of its exclusive outlets in the country to 30 by 2012 as part of its expansion plan.

Besides, it also plans to venture into Tier II cities. "Sunglass Hut has got great response in India so far. We plan to create a chain of 30 outlets in the next three years across key cities like Delhi, Kolkata, Mumbai, Bangalore and Chennai, besides foraying into Tier II cities like Amritsar, Ludhiana and Jalandhar," said Sunglass Hut Brand Manager Pradeep Bhanot.

He, however, did not disclose the company's investment plans.

Sunglass Hut, owned by Italian firm Luxottica, had ventured into India in 2008 under a franchise agreement with realty major DLF’s retail management arm DLF Brands.

The chain today opened its fourth Indian outlet at Hyderabad.

"The Indian eye-wear market is worth hundreds of crores of rupees, of which only a small segment is organised. It gives us immense scope to increase our business," Bhanot said. The chain offers over two dozen premium international brands including Versace, Bulgari, Burberry, Prada, Tiffany, Persol, Revo and Salvatore Ferragamo.

Sunglass Hut has over 2,000 outlets across markets including the United States, Canada, the Caribbean, Europe, Australia, New Zealand, Hong Kong, Singapore, Middle East and South Africa.

Financial Express

Sensex falls by over 213 points

2009-11-19T04:28:00.000-08:00

The stock market benchmark Sensex on Thursday shed 213 points on fears that the government might step in to check the rush of foreign funds into equities, but a section of brokers saw it as a long due correction of overstretched valuation.

Brazil's latest move to curb capital inflows and weakness in European markets also weighed on the market sentiment, although Finance Minister Pranab Mukherjee has said that the rush of foreign funds into the country was not a matter of concern.

The government has, however, said that it would continue to monitor fund flow and act if there was any distortion.

Foreign Institutional Investors have pumped in over USD 15 billion in the country's equities market so far this year.

The Bombay Stock Exchange 30-share barometer settled the day at 16,785.65, a net fall of 213.13 points or 1.25 per cent from its previous close.

Industry chamber Assocham's suggestion to the government on Tuesday that foreign fund inflows should be subject to a two per cent tax may also have affected sentiments.

Hitech Securities Director Sanjeev Bhambri termed today's fall as a healthy correction to the market, saying: "Eventually the market will go higher by December than what it is now".

Domestic Institutional Investors, however, were sustained sellers in the last three days. They sold shares worth Rs 787 crore this week, as per provisional data on stock exchanges.

Among the Sensex companies, Jaiprakash Associates was trading at the lowest level. It fell by 4.53 per cent.

Reliance Infra was down 3.90 per cent, DLF 3.68 per cent, Hindalco 3.46 per cent, Reliance Comm 2.41 per cent, Sterlite Ind 2.22 per cent, ICICI Bank 2.18 per cent, SBI 2.15 per cent Sun Pharma 1.78 per cent and Tata Steel 1.76 per cent.

The National Stock Exchange broader 50-share Nifty also tumbled below the key 5,000 level to close at 4,989.00, a fall of 65.70 points or 1.30 per cent from its last close.

The market breadth was negative with 1,684 losers against 1,052 gainers on the BSE.

The trading volume was low at Rs 5,092.15 crore compared to Rs 5,264.69 crore on Wednesday. JSW Steel clocked the day's highest turnover of Rs 375.71 crore followed by Suzlon Energy (Rs 306.24 crore), HDIL (Rs 148.63 crore), Tata Steel (Rs 136.10 crore) and RIL (Rs 130.22 crore).

Financial Express

Hyundai to invest Rs 800 cr on small car for India

2009-11-18T07:11:00.000-08:00

South Korean car-maker Hyundai will invest around Rs 800 crore to develop a small car for the Indian market that is likely to be launched in the next two years.

The firm, which has operations in India through a wholly -owned subsidiary, Hyundai Motor India Ltd, will manufacture the car, which will be smaller than the Santro, at its plant.

"We are developing a small car and approximately Rs 800 crore will be invested at the Korean plant for development," newly appointed Managing Director and CEO of Hyundai Motor India Ltd (HMIL) Han-Woo Park told reporters.

He declined to give any details, but said: "It will be smaller than the Santro and the price will also be lesser. It will take at least 24 months from now to launch the car in India. Right now, it is in the design stage."

"Initially it will be targetted at India but gradually it will also be exported," Han-Woo added.

"It will be manufactured at the Chennai plant once the design gets completed," he said.

HMIL, which sells popular compact cars like Santro, i10, i20, has made India a small car hub for the Korean firm and has been exporting the cars to overseas markets.

In October, the company sold a total of 51,736 units, an 11 per cent growth compared with same month last year. Its exports, however, dipped by 11.9 per cent to 23,435 units during the month.

Financial Express

Gold, silver hit all-time high in the early trade

2009-11-18T07:08:00.000-08:00

Both the precious metals, gold and silver, resumed at an all-time high on the bullion market here on Wednesday, as gold rallied by Rs 80 per ten grams to Rs 17,095 and silver firmed up by Rs 110 per kilo to Rs 28,510 on persistent demand from stockists on the back of rising trend in global market.

Gold hit another all-time high on Wednesday in the Asian market on worries about future inflation and economic uncertainties, while Asian stocks rebounded as the bearish dollar kept assets in demand.

Spot gold rose as high as $1,143.95 per ounce in early Asia trade, settling later just above $1,140, with expectations for a continued weakness in the US currency also providing a support.

Turning to the local market, standard gold (99.5 purity) rose by Rs 80 per ten grams to resume Rs 17,095 from the overnight closing level of Rs 17,015.

Pure gold (99.9 purity) also firmed up to Rs 17,185 from Rs 17,105.

Silver ready (.999 fineness) too hardened by Rs 110 per kilo to Rs 28,510 from Rs 28,400 previously.

NDTV profit

Sensex ends little changed; oil & gas, banks down

2009-11-18T07:04:00.000-08:00

Indices ended yet another lukewarm session little changed on Wednesday, in line with other global markets and due to lack of buying activity at current levels.

Market opened on a sluggish note and moved in a narrow range. However, selling in heavyweights like Reliance Industries, ICICI Bank and L&T led to a lower closing for the benchmarks.

“For the last the three sessions Nifty has been moving in the range of 5000-5080. If it fails to move above 5080 then we may see a downward correction. If it manages to hold 5080 then we may see bout of short of covering taking the index to 5150-5180 levels,” said a Chandan Taparia, derivative & technical analyst, Anand Rathi.

National Stock Exchange’s Nifty closed at 5054.70, down 7.55 points or 0.15 per cent. The index touched an intra-day low of 5041.65 and high of 5079.30.

Bombay Stock Exchange’s Sensex ended below the 17000 mark, settling at 16,998.78, down 51.87 points or 0.3 per cent. The 30-share index touched a high of 17098.79 and low of 16958.41.

Unlike the frontline counters, the broader market ended with gains. The BSE Midcap Index was up 0.29 per cent and BSE Smallcap Index moved 0.8 per cent higher.

BSE Oil&Gas Index closed 0.84 per cent lower, followed by BSE Bankex down 0.78 per cent and BSE Capital Goods Index down 0.66 per cent. The BSE Metal Index rose 1.2 per cent and BSE IT Index notched up 0.7 per cent.

Reliance Infrastructure (-3.2%), Larsen & Toubro (-1.72%), ICICI Bank (-1.47%), Reliance Industries (-1.47%) and Grasim Industries (-1.17%) ended with losses.

Tata Motors (3.14%), Tata Steel (1.68%), ITC (1.61%), Infosys Technologies (1.54%) and Jaiprakash Associates (1.06%) restricted the fall.

Market breadth was positive on the BSE with 1,598 advances and 1,166 declines.

Economic Times

Demand for cement falls in export market

2009-11-17T07:33:00.000-08:00

UltraTech, Ambuja Cements face erosion in realisation as prices dip by $10 a tonne. With overcapacity, declining demand and piling of inventory pushing cement prices down by $5-10 a tonne in the cement exports market, domestic exporting players have found realisations are no longer remunerative.

According to them, overseas demand for cement may decline by around 20-30 per cent this year. In addition, prices of clinker — the first stage in the production of cement — has also taken a hit of around the same quantum.

CEMENT WOES

* Price realisation in cement export markets down by $10 a tonne

* Overall exports may decline 20-30% in FY10

* West Asia facing overcapacity and decline in demand

* Inventories have piled up

* West Asia adding 110 million tonnes by 2010, exports from Pakistan also impacting market

West Asia and Sri Lanka are the main overseas markets for the domestic cement industry, with UltraTech and Ambuja Cements being the major exporters.

Ajay Kapur, head of marketing and commercial services at Ambuja Cements, said: “Demand in West Asia and Sri Lanka had dropped, pushing prices down by $10 a tonne, making them unremunerative. Moreover, construction activities slowed down due to the festival of Ramadan, leading to a piling up of inventories.”

In the last three-four months, the realisation of cement in the overseas market came down from $52 to $44 a tonne, Kapur added.

“Though export demand is low, it is not a worrying signal as most of the projects in the region have still not been completed,” said Vinod Juneja, managing director of Binani Cement.

UltraTech Cement, a part of the Aditya Birla group, also faced an erosion in realisation in the export markets. K C Birla, chief financial officer of the company, told Business Standard cement is currently ruling at $40 a tonne, whereas clinker is fetching $37 a tonne abroad.

The realisations are flat as export demand is less, an industry analyst said. However, she added, it will have little impact on the cement industry, as only 2.5-3.5 million tonnes of the total production is exported.

In the first quarter of the current financial year, the country’s cement exports grew over 70 per cent, while clinker shipments went up by 67 per cent on a year-on-year basis.

According to Kapur, cement exports may see a decline of 20-30 per cent this year. He says exports from Pakistan to the overseas markets where Indian companies operate also had an impact on the prices.

In addition, the West Asian market, which comprises 12 countries — including Saudi Arabia, Iran, UAE, Iraq, Syria and Kuwait — is witnessing an expansion in cement capacity of over 110 million tonnes. The region’s capacity in 2010 will stand at 213 million tonnes, leaving nine countries in a surplus situation, except Iraq, Kuwait and Bahrain.

However, industry players maintained that volumes are not an issue if prices drop further. “We can easily divert the material to the domestic market,” said Kapur.

Business Standard

Bharat Forge plans Rs 50k-cr investmen

2009-11-16T06:50:00.000-08:00

The Kalyani Group's flagship company Bharat Forge is planning to make a big foray into the power sector with an investment of up to Rs 50,000 crore and a targeted generation capacity of up to 10,000 MW, over the next ten years.

According to industry sources, the company plans to set up power plants in Gujarat, Maharashtra, coastal Andhra Pradesh and Tamil Nadu.

"The group plans to diversify into other capital goods segment to de-risk itself from relying only on the auto components business. It has identified power sector as a priority area and is looking at generating 10,000 MW of power in the next ten years," a source said.

With each mega watt requiring an investment of about Rs five crore, Bharat Forge's plans could entail an investment of Rs 50,000 crore, the source added.

When contacted, Bharat Forge Chairman and Managing Director Baba Kalyani said the country's power generation capacity would have to be increased to nearly 800,000 MW by 2031-32 to sustain an 8 to 10 per cent economic growth over the next couple of decades.

"Bharat Forge's initiatives in the power sector are geared to help India achieve this. We are making significant investments to address some of the key constraints that the country faces in enhancing power generation rapidly," he said, but did not comment on specifics.

Source, however, said while the company's power plants could be largely thermal, there could also be some hydro plants.

Financial Express

Rupee pares gains after hitting 46/dollar

2009-11-16T06:46:00.000-08:00

The Indian rupee rode a rising sharemarket and a weakening dollar to reach its highest in nearly a month on Monday, but then unwound most
of the gains on a sudden surge in demand for the US unit from importers.

The partially convertible rupee ended at 46.20/21 per dollar. That was off an early high of 46.0, its strongest since Oct 20, but still 0.2 per cent stronger than Friday's close of 46.31/32.

On Friday, the rupee had fallen to 46.75 during trade, its weakest since Nov 6.

"Many banks sold dollars in the morning, but were forced to cover the short positions as importers began buying in the market," said a senior trader with a foreign bank.

The rupee had strengthened as the main BSE share index climbed more than a per cent to its highest close in nearly a month, powered by optimism about the economy.

Foreigners have bought $15 billion of shares so far in 2009, after selling more than $13 billion last year. The inflows have helped the rupee recover from a record low of 52.2 in March.

One-month offshore non-deliverable forward contracts were quoting at 46.14/24, stronger than the onshore spot rate, suggesting a bullish near-term outlook.

In currency futures, the most traded near-month contracts on the National Stock Exchange and MCX-SX were at 46.26 and 46.2550 per dollar respectively, strengthening from Friday's 46.3925 and 46.3950.

Economic Times

Gold futures could breach Rs 17,000 this week

2009-11-16T06:43:00.000-08:00

Gold futures may breach the psychological Rs 17,000 mark this week on the back of a weaker dollar, enhancing the yellow metal's appeal
Gold as an alternative investment, analysts said.

The most-traded December gold contract was trading 0.46 percent higher at Rs 16,877 per 10 grams at 4:40 p.m., after hitting a fresh record high of Rs 16,925 earlier.

The contract has struck 12 record highs since February 20, earlier this year, with eight all-time highs this month. "As of now the trend in gold is still strong," said Harish Galipelli, head of research with JRG Wealth Management.

"Gold may hit Rs 17,000 this week on a continuing weakness in dollar and investment demand," added Galipelli. The dollar slipped as traders took a lack of agreement on currencies among Asian and US leaders as a cue to sell the greenback, even as speculation of a near-term yuan appreciation cooled.

"The trend is still up, and may target Rs 17,000 later today," said Amrut Deshmukh, senior analyst, Way 2 Wealth Securities. Buying could be initiated at Rs 16,850, with a target of 17,600 and with a stop loss of Rs 16,750, said Deshmukh.

Economic Times

Sensex rises 183 points to close above 17,000

2009-11-16T06:40:00.000-08:00

Strong global sentiments, the positive weekend numbers on industrial output and cues from the government on its divestment plans helped Indian equities make handsome gains Monday, with a key index rising 183 points to close above the 17,000-mark.

The sensitive index (Sensex) of the Bombay Stock Exchange (BSE) opened higher at 16,893.11 points against Friday's close at 16,848.83 points and ended trade at 17,032.51 points, up 183.68 points or 1.09 percent.

The index had seen an intra-day high of 17,083.2 points, but shed some gains in the last 30 minutes.

At the National Stock Exchange (NSE), the broader 50-share S&P CNX Nifty breached the 5,000-point mark to shut shop at 5,058.05 points, with a gain of 1.18 percent, over the previous close at 4,998.95 points.

Broader market indices also closed in the green, with the BSE midcap index ended trade at 1.14 percent higher and the BSE small cap index 1.22 percent up.

The market breadth was positive, with 1,758 stocks advancing, 1,017 declining and 89 remaining unchanged.

Out of 30 stocks on the Sensex, 20 ended on the gainers' list.

Prominent among them were Maruti Suzuki, up 5.45 percent; DLF, up 4.54 percent; Hero Honda, up 3.82 percent; Sterlite Industries, up 3.55 percent and Reliance Communications, up 3.05 percent.

Among losers were TCS, down 0.63 percent; Infosys, down 0.34 percent and NTPC, down 0.16 percent.

The government had Friday said all ministries had been asked to compile a list of state-run firms for sale of stake and listing on stock exchanges, even as it expected partial divestment in at least three such firms by the end of this fiscal.

Disinvestment Secretary Sunil Mitra said as per data available for 2007-08, there were 10 listed state-run firms with less than 10 percent public holding, while 50 others met the criteria for divestment in terms of profits and net worth.

Statistics on India's industrial production a day earlier showed a 9.1-percent growth in September, compared to 6 percent in the corresponding month last year, in yet another sign of economic recovery in the country.

Other Asian markets also ended on a firm note.

The primary index of the Hong Kong Stock Exchange, Hang Seng, was 390.35 points or 1.73 percent higher at 22,943.98 points.

The Nikkei, a key index of the Tokyo Stock Exchange, closed at 9,791.18 points, up 20.87 points.

In China, the Shanghai Stock Exchange composite index shut shop at 3,275.05 points, up 2.74 percent.

European markets were also trading in the green.

Britain's FTSE 100 index was ruling 61.77 percent higher at 5,358.15 points, while its French peer, CAC 40, was trading 34.89 points up at 3,840.9 points.

The German index, DAX, was ruling 62.32 points up at 5,749.15 points.

Sify Business

Domestic call centre market seen at $6.8 bn by 2013

2009-11-13T02:11:00.000-08:00

With around 500 firms sending out promotional messages or calling up for bill payment reminders, the domestic call centre market is seen growing 33 percent per year to top $6.82 billion by 2013, says leading global market research and analytics firm IDC.

This apart, the domestic call centre industry, now estimated at $1.62 billion, will also evolve into a third party outsourcing relationships from the existing model where such work is largely done by companies themselves.

'This implies that rather than merely running isolated processes for customers, business process outsourcers would also engage more deeply to identify and transform core business processes to add greater market value in the creation and delivery of end products and services,' IDC said.

The industry currently offers a wide range of services from customer care to research. Banking, financial services and insurance segment contributes the lion's share of 37 percent to revenues, followed by telecom accounting for 25 percent.

Other verticals such as services for energy utilities and companies in food, auto, aerospace, consumer durables and government contribute 17 percent to the revenues, while travel trade segment contributes 8 percent.

'The domestic business process outsourcing (BPO) market shows promise of growth, especially in such verticals like banking, financial services and insurance segment and telecom in the short term,' says Arpan Gupta, a senior analyst with IDC India.

'The concern areas for the industry that services overseas customers -- such as rupee-dollar volatility, rising infrastructure costs in Tier-I cities, over-dependence on North American and European markets -- are expected to have minimal impact on the domestic sector.'

Once some mega outsourcing deals come through and players start offering more services in regional languages, the industry will be able to achieve the growth target over $6.8 billion over the next five years.

Non-English call centres in Tier-II and Tier-III centres, providing services to telecom and aviation sectors at a lower cost will add to the growing industry, said the report.

However, higher training costs in such cities and lack of availability of an adequate talent pool continues to be an area of concern for players, the report added.

Voice processes in the Indian domestic BPO market contribute 55 percent to the overall domestic revenues while non-voice market makes up the rest.

'As the industry enhances focus on Human Resource Outsourcing (HRO), Legal Process Outsourcing (LPO), billing and high-end analytics, the BPO market would see a gradual shift from Voice processes to non-Voice processes,' said Gupta.

Sify Business

Sensex gains momentum; IT, metals lead

2009-11-13T02:03:00.000-08:00

Benchmarks moved higher as buying emerged seen across the board on Friday. All the sectoral indices were in the green led by IT, metals and auto stocks.

“Going forward it’s very necessary that Nifty manages to hold the 4900 level to keep this strong momentum live.
Technically if Nifty breaks the 4900 level in the near term which is the 50-day moving average then it’s quite possible that markets could drift lower to 4830-4770.

Strong support for Nifty is placed at 4905 region and resistance comes at 4990-5015, unless Nifty holds above the 5K mark with solid market breadth fresh buying should be avoided. In the short term 4830-4770 will play an important support level for the market,” said Nirmal Bang report.

At 12:20 pm, Bombay Stock Exchange’s Sensex was at 16866.18, up 170.15 points or 1.02 per cent. The index hit a high of 16898.68 and low of 16666.70.

National Stock Exchange’s Nifty was at 5004.20, up 51.55 points or 1.04 per cent. The broader index touched a high of 5014.40 and low of 4942.65.

BSE Midcap Index gained 0.57 per cent and BSE Smallcap Index moved 0.82 per cent higher.

BSE IT Index was up 1.89 per cent, BSE Metal Index jumped 1.71 per cent and BSE Auto Index moved 1.14 per cent higher.

TCS (2.57%), Maruti Suzuki (2.30%), Tata Steel (1.92%), Infosys Technologies (1.91%) and Hero Honda (1.80%) were amongst top Sensex gainers.

Jaiprak Associates (-2.45%), ACC (-0.55%), DLF (-0.18%) and ONGC (-0.07%) were the only index losers.

Market breadth was positive on the BSE with 1494 gainers and 966 losers.

Economic Times

BHEL bags Rs 5,040-cr order from Jindal Power

2009-11-03T08:59:00.000-08:00

State-run power equipment maker BHEL said it has bagged a Rs 5,040-crore contract from Jindal Power for setting up a 2,400-MW thermal power plant in Chhatisgarh.

"BHEL has secured contract from Jindal Power for setting up a 2,400 MW thermal power plant (4x600 MW) in Chhatisgarh," a company statement said.

As per the contract, BHEL will install four units of 600 MW each in this extension stage of Rs 5,040-crore OP Jindal Super Thermal Power Plant (STPP), Raigarh, it said.

BHEL’s scope of work in the contract envisages design, engineering, manufacture, supply, erection, testing and commissioning of boilers, steam turbines, turbo-generators and associated auxiliaries along with controls and instrumentation system.

The company, at present, manufactures equipment that can generate 10,000 MW of electricity annually. BHEL plans to augment this capacity to 15,000 MW by December 2009, and further raise it to 20,000 MW by 2012.

Financial Express

Crude imports fall by 41% to $31.6 bn

2009-11-03T08:56:00.000-08:00

India's crude oil import bill fell by 41 per cent to USD 31.6 billion in April-September this year as international rates declined from a record peak.

Asia's third-largest oil consumer imported 69.6 million tonnes of crude oil for USD 31.6 billion in the first six months of current fiscal against 64.84 million tonnes of crude imported for USD 53.78 billion in the year ago period, according to the data available from Petroleum Ministry.

Crude oil prices had peaked to USD 147 per barrel in August 2008 and have since eased to around USD 70 a barrel.

India also imported 7.16 million tonnes of petroleum products, mainly diesel and naphtha, for USD 3.61 billion. In April-September 2008, fuel imports of 9.98 million tonnes cost USD 9.44 billion.

Fuel exports at 14.3 million tonnes (USD 7.29 billion) in April-September 2009 were lower than 19.17 million tonnes (USD 18.77 billion) in the same period last year.

The nation's domestic consumption was almost flat at 10.69 million tonnes in September and rose 3.6 per cent to 67.26 million tonnes in April-September, the data showed.

Demand for diesel, the most consumed fuel, was up 4.7 per cent at 4.12 million tonnes in September and 8.5 per cent to 27.17 million tonnes in April-September. Petrol consumption soared 14.7 per cent to 6.3 million tonnes in the six months.

Jet fuel consumption was down 0.3 per cent at 2.22 million tonnes, reflecting the impact of economic slowdown on airlines.

Financial Express

Google launches voice search for Nokia users

2009-11-03T08:52:00.000-08:00

Search engine major Google unveiled a mobile application for Nokia handsets that will allow users find information through speech on Tuesday.

"The application is equipped with speech recognition technology to understand Indian accents. Its software enables users of Nokia S60 handsets to access information on the Internet by voice search," Google India said in a statement.

Nokia S60 includes most N and E series models like N-86 and E-63.

"The extension of Google's search by voice feature to more mobile handsets is a natural next step for our mobile strategy ... With the launch of this service for Nokia S60 handsets, we would be catering to a larger segment of mobile users, as a significant number of Nokia phone users are on the S60," Google India head of products Vinay Goel said.

The application can be downloaded for free from Google's mobile website m.google.co.in.

Rediff

Reliance Communications Launches Per-Second Billing Plan

2009-11-03T08:46:00.000-08:00

India's Reliance Communications Ltd. Tuesday said it has launched a per-second billing plan for all calls, following similar moves from its peers amid intensifying competition and price wars.

The company will charge 0.01 rupees per second for all calls, including national long distance and roaming, it said in a statement. For long duration calls it will charge 1 rupee ($0.02) for three minutes, it said.

Reliance Communications' move follows a spate of similar announcements from peers including Tata Teleservices Ltd. and Bharti Airtel Ltd., which are expected to erode telecom companies' earnings, analysts said.

Brokerage HSBC Global Research said in an August report that if incumbent and new players adopt the per-second plan, it could hurt the sector's revenue by 10%-15%. It described such a billing plan as "disruptive" for the sector.

For Bharti it could result in a per-minute revenue fall to 0.35 rupees from 0.53 rupees now, the brokerage said.

However, some analysts feel that Reliance Communications, having already had significant impact from its 0.50 rupees per-minute billing plan, won't be further hit by the new one.

Reliance Communications reported average revenue per minute at 0.47 rupees in July-September.

Per-second billing was triggered by the entry of Tata DoCoMo Ltd., a joint venture between India's Tata Teleservices, and Japan's NTT DoCoMo Inc., which started offering such a billing plan in June.

"Tata has already mopped up subscribers to this plan," Nishna Biyani, analyst at Prabhudas Lilladher, said.

Wall Street Journal

Sensex plunges 500 points on weak global cues

2009-11-03T07:42:00.000-08:00

It was a blood bath on the Dalal Street Tuesday as indices ended with huge losses after an extended weekend. Benchmarks breached crucial
Sensex supports before settling near the day’s lows. The worst hit in the correction were stocks from realty and metals space.

Market opened lower taking cues from subdued Asian markets and lack of positive triggers back home. Analysts were expecting the Indian market to correct in order to match-up with global markets which witnessed a sell-off in the previous session. (Indian markets were shut Monday on account of Guru Nanak Jayanti). The trigger, however, came in the form of poor opening of the European markets.

Traders pressed the panic button on fears that global economic recovery would come to a halt if stimulus packages are withdrawn. Some disappointing quarterly earnings also led to the sharp fall in share prices.

“This fall could be just a beginning of deeper correction. Such a sharp crack below 4700 will force investors with cash to remain away. This would result in lack of support to the indices. Some minor bounce back would be seen but that should be used to exit positions. We expect the Nifty to take

support at 4400 and if it fails to hold then 4100 is there on the horizon. Market will eventually find support there as stocks will look attractive at these levels,” said Ambareesh Baliga, vice president, Karvy Stock Broking.

Bombay Stock Exchange’s Sensex ended at 15,404.94, down 491.34 points or 3.09 per cent. The index hit intra-day low of 15,330.56 and high of 15,957.06.

National Stock Exchange’s Nifty closed at 4,563.90, down 147.80 points or 3.14 per cent. The 50-share index fell to a low of 4,538.50 and high of 4,729.85 in today’s trade.

“The downtrend is very much in place and Nifty may see a trading bounce around 4450-4400. It is difficult at this time to ascertain the bottom and Nifty may slip to 4100-4200 levels. Traders should adopt sell at every rise opportunity. Realty, construction and capital goods stocks are weak and may fall further,” said Anil Manghnani, director, Modern Shares and Stock Brokers.

The BSE Midcap Index was down 3.74 per cent and BSE Smallcap Index slipped 4.50 per cent.

Amongst the sectoral indices, BSE Realty Index plunged 9.76 per cent, BSE Metal Index fell 5.95 per cent and BSE Oil&gas Index was down 4.10 per cent.

Hindalco Industries (-10.50%), DLF (-9.04%), Jaiprakash Associates (-7.52%), Sterlite Industries (-6.40%) and ACC (-6.20%) were amongst the top Sensex losers. Index heavyweight Reliance Industries fell a massive 5.73 per cent on the BSE.

“Reliance Industries is trading below its long term 100 & 200 day moving average of Rs 1978-2042 which is negative for the stock. Going forward, if the stock breaks below Rs 1910 and trades consistently then it might even fall upto Rs 1880-1835 or maximum to Rs 1730. The stock will show strength only if trades above Rs 1980,” said Michael Pillai, technical analyst at Nirmal Bang.

Bharti Airtel (2.67%), Maruti Suzuki (1.13%) and Sun Pharmaceuticals (0.31%) were the only gainers.

Reliance Communications reported 51.66 per cent decline in its consolidated profit at Rs 740 crore for the second quarter due to provisions for foreign exchange fluctuation or derivative losses. The company had consolidated net profit of Rs 1,531 crore in the same quarter last fiscal. The stock tumbled 6.45 per cent on the NSE.

Hindalco Industries reported a 52% drop in standalone net profit for the quarter ended September, due to a sharp drop in metal prices on the London Metal Exchange. The Aditya Birla group flagship company said its net profit in the July-September period fell to Rs 344 crore from Rs 720 crore last year, while sales in the same period was down 13.4% to Rs 4,917 crore. The stock plunged 10.45 per cent.

Suzlon Energy posted Rs 356-crore loss in the quarter ended September 30, 2009 compared to a Rs 22.84-crore loss posted in the same period last year, owing to lower volumes. Its total consolidated revenues, during the period, declined to Rs 4,793-crore as compared to Rs 6,921-crore a year-ago. The stock tanked 13.39 per cent on the NSE.

Market breadth was negative on the BSE with 2171 declines against 534 advances.

All eyes are set on the US Federal Reserve that is holding two-day meet beginning Tuesday. At 5:40 pm IST, Dow Jones stock futures was down 0.97 per cent, S&P 500 fell 1.09 per cent and Nasdaq 100 declined 0.91 per cent.

Economic Times

India still likes dollars despite buying gold: FM

2009-11-03T07:37:00.000-08:00

A decision by the Reserve Bank of India to buy 200 tonnes of gold from the IMF for $6.7 billion does not reflect a preference for the metal over the dollar, the finance minister said Tuesday.

The International Monetary Fund kicked off its planned sale of more than 400 tonnes of gold with an announcement Monday that it had sold almost half to India, the world's biggest gold consumer, at near-record prices.

The purchase "doesn't mean we don't prefer the dollar any more or like gold any better," Finance Minister Pranab Mukherjee told reporters in New Delhi.

Some analysts expect central banks around the world to diversify their holdings and purchase more gold as a shield against a weakening dollar. The bank said in a statement that the purchase "was done as part of the Reserve Bank's foreign exchange reserves management operations".

The central bank's stock of the precious metal increased to 557 million tonnes from 357 tonnes, a jump of over 55 percent. The bank said the purchase "was an official sector off-market transaction and was executed over a two-week period during October 19-30, 2009 at market-based prices".

The IMF is selling the gold to raise resources to augment its operations and provide concessional loans to poor countries. Its current gold stock of 357 tonnes is valued at around $9.6 billion. A senior IMF official said that the IMF was "lucky" in selling the 200 tonnes to India for roughly 1,045 dollars an ounce, compared with 850 dollars an ounce in April 2008. India is the world's biggest consumer of gold, importing between 700 and 800 tonnes of the metal every year or 20 percent of global demand.

Economic Times

Investors look for the big winners of next upturn

2009-11-01T21:00:00.001-08:00

Investors are casting around for the next set of growth stocks to propel the market once the current bout of correction runs its course.
Sensex Key constituents of the benchmark Sensex such as Reliance Industries and large banks that face margin pressures are not among the most favoured by investors at present and the index is down 9% in the past couple of weeks despite most companies posting higher earnings.

Reliance Industries and three banks — SBI, ICICI Bank and HDFC Bank — together accounted for about 35% of the 9,000-plus point rise in the Sensex between March and mid-October this year. But near-term outlook for these index heavyweights is far from rosy, and market watchers are worried that a likely underperformance in these stocks could weigh down the index as well as the overall sentiment, when the markets open for trading on Tuesday.

“It is not about three or four sectors... a short-term correction is imminent,” said Ved Prakash Chaturvedi, managing director of Tata Mutual Fund. “If you look at the latest quarterly numbers, it is clear that companies are not exactly galloping out of the slowdown. The correction could continue for some more time, though it is unlikely to be a steep one because of the global liquidity on the sidelines,” Mr Chaturvedi said.

Key indices have fallen in seven out of the last eight trading sessions, with the fall aggravated by indications of a rise in interest rates shortly and disappointing quarterly numbers from Reliance Industries. Market experts feel near-term weakness in the market as a whole will be led by global factors rather than domestic.

“Global investors have made decent profits (in India) over the past few months and will be looking to encash a part of that because the outlook on the global economy still remains hazy,” said A Balasubramanian, chief executive and chief investment officer of Birla SunLife Mutual Fund.

Banking stocks have been the worst performers in the recent meltdown. The BSE Bankex has fallen nearly 9% in the last one week after the Reserve Bank of India in its monetary policy raised the amount of money that banks have to set aside for non-performing loans to 70%, and set a deadline of September 2010 to adhere to the rule. The central bank also indicated that interest rates are set to rise shortly, which market watchers fear will hurt demand for loans, and hence, the revenues of banks.

“In a scenario of higher interest rates, banks could underperform,” Mr Chaturvedi said.

But Mr Balasubramanian feels the market is pricing in a worst-case scenario for banks. “Most of the high-cost deposits that the banks had raised last year have already started maturing; this will almost halve their cost of funds, and boost net interest margins. In a scenario where credit growth will pick up as the economy gathers steam, banks are a good bet,” he said.

Economic Times

R-Com takes a beating

2009-10-31T22:11:00.001-07:00

Reliance Communications (R-Com) today reported a 51.7 per cent slump in net profit at Rs 740 crore in the second quarter ended September 30.

The telecom company had raked in a profit of Rs 1,531 crore in the year-ago quarter.

Revenues rose just 1 per cent to Rs 5,703 crore. Wireless revenues — which account for over 70 per cent of the company’s overall revenues — fell 7.5 per cent to Rs 4,010 crore.

Profit margins were impacted by intense competition, aggressive industry-wide tariff restructuring and higher operational costs involved in the rollout of GSM services.

Earnings before interest, tax, depreciation and amortisation were down 12.2 per cent to Rs 2020 crore from Rs 2302 crore in the year-ago quarter.

The company said its net profit would have been higher at Rs 1023 crore if it hadn’t been for the provisioning it had to make for mark to market losses on foreign exchange derivatives amounting to Rs 283 crore. “These losses stand fully recovered, based on subsequent favourable exchange rate movements,” it added.

The company’s customer base has grown 53.3 per cent to 92 million from 60 million in the corresponding quarter a year ago.

Telegraph

SingTel to up stake in Bharti Airtel

2009-10-31T22:08:00.001-07:00

Singapore Telecommunications has decided to increase its effective stake in Bharti Airtel from 30.43 per cent to 31.95 per cent.

The move comes at a time when the Bharti Airtel stock plummeted 6.38 per cent on Friday as the telecom operator showed a slower pace of growth in the quarter ended September 30, 2009, compared with the corresponding period of the last year.

SingTel expects to invest between Rs 1,807.3 crore and Rs 3,008.4 crore to increase its stake, according to a filing to the Singapore Exchange on Friday.

The effective stake increase in Bharti Airtel will be done by SingTel raising its shareholding in Bharti Telecom to 36.16 per cent from 32.81 per cent.

Bharti Telecom is the promoter company of Bharti Airtel and holds around 45.3 per cent in the latter. The Sunil Mittal-led Bharti group declined to comment on the development.

According to the filing with the stock exchange, the acquisition — done through SingTel’s wholly owned subsidiary Pastel Ltd — is in line with the company’s strategic focus on maximising the value of its existing businesses.

Patel Ltd will buy 7,30,000 issued shares in Bharti Telecom and the payment for the transaction will be done in three tranches over nearly two years. The Bharti scrip closed at Rs 292.15 on Friday compared with Rs 415.50 on July 24.

Telegraph

Lever net dips below expectations

2009-10-31T22:04:00.001-07:00

Hindustan Unilever, the country’s largest fast moving consumer goods (FMCG) company, posted a worse-than-anticipated 22 per cent drop in net profit at Rs 428.53 crore for the quarter ended September 30. In the year-ago quarter, the company had earned a net profit of Rs 546.61 crore.

The fall in net profit was attributed to a one-time charge and higher advertising expenses. The FMCG company recorded a 5 per cent increase in net sales during the quarter at Rs 4,228 crore compared with Rs 4,028 crore in the second quarter of 2008-09.

Hindustan Unilever suffered a one-time loss of Rs 166 crore during the quarter as it paid the Hindustan Lever Employees’ Union for dues arising out of a closed unit at Sewree, Mumbai.

The company also recorded a 38 per cent increase in advertising expenses during the quarter to Rs 571 crore.

Chairman Harish Manwani said, “We sustained good growth momentum in the domestic consumer business, driven by high quality innovations and sharper in market execution. Personal products and the foods business continue to deliver strong growth. In soaps and detergents, we are strengthening our full portfolio in the mass segment.”

A statement by the company said soaps and detergents grew modestly on account of downtrading in detergents. A company official admitted that Unilever was facing pressure in this category. Revenues from soaps and detergents grew less than one per cent during the quarter. This category contributes nearly half of the company’s domestic revenues.

Godrej numbers

Godrej Industries today reported a consolidated net profit of Rs 66.67 crore for the second quarter ended September 30 compared with Rs 19.4 crore in the same period last year. Total income stood at Rs 896.17 crore during the quarter against Rs 965.27 crore in the same period last year.

Hindalco loss

Hindalco Industries today reported a net profit of Rs 344 crore for the second quarter ended September 30, down from Rs 719.95 crore in the same period of the previous fiscal.

“Due to a change in accounting standards of the company, the figures of the previous quarter are not comparable with that of the quarter ended September 30, 2009,” Hindalco Industries said in a filing to the Bombay Stock Exchange.

Total income stood at Rs 4,974.4 crore in the latest quarter, while it had a total income of Rs 5,859.95 crore in the same period previous fiscal.

Telegraph

SBI net rises 10% to Rs 2,490 cr on non-interest income spike

2009-10-31T21:59:00.013-07:00

A robust jump in non-interest income helped State Bank of India post a net profit of Rs 2,490 crore in the second quarter ended September 30, 2009, up 10 per cent compared with Rs 2,260 crore in the corresponding period last year.

Non-interest income rose 50.45 per cent. Net interest income was up marginally by 2.81 per cent.

Mr O. P. Bhatt, Chairman, said that but for the liquidity overhang of Rs 50,000-60,000 crore, higher overhead costs incurred for setting up 550 branches and 3,000 ATMs and wage settlement expenses, the profit would have been higher.

Total income rose 19 per cent to Rs 21,301 crore (Rs 17,910 crore in Q2FY09).

Total expenditure increased by 20 per cent to Rs 16,466 crore (Rs 13,716 crore).

The figures of the current period include that of the erstwhile State Bank of Saurashtra, which was merged with SBI in August 2008. Hence, the figures of the previous period are not strictly comparable.

Half-year numbers

In the first six months of FY2010, India’s biggest bank logged a 24 per cent increase in net profit at Rs 4,820 crore vis-À-vis Rs 3,900 crore in the corresponding half last year.

As of September-end 2009, total deposits increased by 25.16 per cent to Rs 7,72,904 crore (Rs 6,17,524 crore as of September-end 2008) and advances were up 16.39 per cent to Rs 5,80,237 crore (Rs 4,98,513 crore).

“Credit growth was flat till June. However, post June, growth has picked up. In October, credit offtake has been very high. If this growth rate continues we should achieve 22 per cent growth in this financial year,” Mr Bhatt said.

The SBI chief underscored the fact that the bank had a strong pipeline of unavailed credit sanctions aggregating Rs 25,000 crore.

Further, loans proposals aggregating Rs 25,000 crore awaiting sanctions.

Deposit base

Pointing out that the bank was growing its savings bank deposit base at the rate of Rs 5,000 crore a month in the last few months, Mr Bhatt said robust growth in low-cost deposits and shedding high-cost term deposits (the bank shed term deposits aggregating Rs 44,000 in H1FY10) would improve net interest margin by 10-15 basis points in every quarter.

In Q2FY10, the bank’s gross non-performing assets increased by Rs 2,058 crore (Rs 1,018 crore in Q2FY09). It made loan loss provisions amounting to Rs 997 crore (Rs 911 crore).

On capital raising plans, the SBI chief said that the bank had adequate liquidity and was not looking to raise fund immediately.

However, the bank will raise Rs 36,000-crore in the next five years to maintain a capital adequacy ratio of 12 per cent. The CAR, at present, stands at 14.11 per cent.

The Hindu business line

Mahindra & Mahindra net profit jumps 242%

2009-10-29T05:38:00.000-07:00

Auto major Mahindra & Mahindra on Thursday said its net profit for the quarter ended September 30 soared 242 per cent to Rs 703 crore from Rs 206 crore in the like period last year.

The company, which has interests in other sectors besides auto, said in a regulatory statement that its gross revenue and other income for the period under review rose 40 per cent to Rs 5,189 crore from Rs 3,935 crore a year ago.

During the quarter, the company recorded a volume growth of over 44 per cent in the utility vehicle (UV) segment as against the industry growth of 21.4 per cent.

It sold 55,280 UVs during July-September as against 38,462 UVs sold during the like period last year.

The outstanding financial results for the quarter were largely due to strong performance in sales by its automotive and farm equipment sectors, the company said.

'The volume and market share growth of the company was driven by the excellent sales of Xylo as well as the refreshed version of the Scorpio and the all time customer favourite, Bolero,' the company said in a statement.

Mahindra sold 93,105 tractors during July-September as against 73,227 during like period last year in the domestic market.

Its market share in this sector stood at 41.5 per cent during the period as compared to 39.8 a year ago.

Sify

2009-10-29T05:36:00.000-07:00

Engine manufacturer Cummins India today reported a net profit of Rs 87.7 crore for the second quarter ended September 30, 2009, while it had a net profit of Rs 93.9 crore in the same period last year.

The figures are not comparable pursuant to the scheme of amalgamation of Cummins Sales & Services India and Cummins Auto Services with the company and given effect to in the results for the quarter ended September 30, 2009, Cummins India said in a filing to the Bombay Stock Exchange (BSE).

Total income stood at Rs 635.5 crore in the latest quarter ended September, however it had a total income at Rs 824.19 crore in the same quarter previous close.

Business Standard

2009-10-29T05:13:00.000-07:00

Energy major CESC posted a marginal increase in net profit at Rs 126 crore for the quarter ended Sep 30 against Rs.124 crore in the
corresponding quarter a year ago, a top company official said here Thursday.

"We had to import lot of expensive power during the quarter than we did before," Sanjiv Goenka, company's vice chairman told reporters here. Describing the quarter performance as decent, he said the power plants were working at 98.6 percent across all stations.

CESC, the flagship company of diversified RPG Entreprises, is the sole distributor of electricity within an area of 567 sq kilometre of the city and adjoining Howrah. It owns and operates four thermal power plants generating 975 MW of power.

These power plants are: Budge Budge Generating Station (500 MW), Southern Generating Station (135 MW), Titagarh Generating Station (240 MW) and New Cossipore Generating Station (100 MW).

The company is expecting to finish the financial closure for the Dhariwal power project within the next seven to ten days, Goenka added. CESC has acquired a little more than 50 percent in Dhariwal Infrastructure to set up a 600-MW thermal power project at Chandrapur in Maharashtra.

The project cost is around Rs.2,850 crore and will be funded in a debt equity ratio of 70:30. He said the Maharashtra project will come up before the Haldia project, which is yet to get the last tract of its allotted 400 acres, he added.

Goenka is hopeful that the financial closure of the Budge Budge project will be done by the year-end. The third unit (250 MW) in Budge Budge is being constructed at a cost of Rs.1,200-crore. The Budge Budge power station currently has two units of 250 MW each.

The company has been short-listed for the Patna circle, he said.

"We are one of the three parties shortlisted for the Patna circle but has decided to go to court for the admissibility of a bidder which has emerged as the highest bidder as we doubt their credential," Goenka said.

The company is also looking for acquiring existing power generating units in the range of 300-600 MW capacity, he said as a part of its expansion plans.

The recent coal price hike by Coal India of around 15 percent has hit the power utility hard though Goenka refused to quantify the financial impact.

"We have started looking at acquiring coal mines in South Africa and Australia to bring down our coal cost," Goenka said. The company's plans to acquire coal blocks in Indonesia have not made any progress till now.

"We looked at six coal mines there but in every mine we found out the actual coal reserve was a mere fraction of the stated reserve," the vice chairman added.

Economic Times

Why RBI did not hike rates to contain inflation

2009-10-29T05:10:00.000-07:00

Inflation continues its upward trajectory. The wholesale price wholesale price index (WPI), a measure of producer prices, for week-ended October 17 stood at 1.51% versus 1.21% in the previous week. Inflation for week-ended August 22 was revised to 0.17% as against the provisional figure of -0.21%.

‘Food prices driving inflation’

The threat of rising inflation as a result of stimulus measures and excess liquidity introduced by the government during the financial crisis has gained increased prominence of late. However, pure excess liquidity induced to boost growth is not the sole driver of inflation.

Reserve Bank of India Governor Duvvuri Subbarao points to rising food prices as also the driver. A woeful monsoon this year has resulted in food shortages across the country and rising food prices have played truant.

Thus, it is not just liquidity but also supply-side pressure that is putting pressure on inflation. In its monetary policy review earlier this week, the RBI — amid calls to tame inflation — chose not to tighten its stance by hiking key rates like repo and reverse repo.

A hike in rates would not have been helpful in containing inflation, Subbarao felt. “What would have been the benefit of tightening at this point in time? It would not have helped us to rein in inflation because it is driven by food prices,” he told CNBC-TV18 in an interview.

In its monetary policy, the RBI raised its forecast for inflation by March 2010 to 6.5%, up from its earlier estimate of 5%.

Inflation forecast not on new series

The government recently changed its base year used to calculate inflation from 1993 to 2004 and may soon start publishing inflation data on a monthly basis instead of every week, as is the practice now.

However, the RBI’s March target is based on the current series, the RBI governor said. "The new WPI series is not used to arrive at the inflation forecast. We will recalibrate our forecast after the new series comes out,” he said, adding that inflation may go up till December before plateauing out.

Money Control

Sensex ends over 200 points lower; realty, metals drag

2009-10-29T05:01:00.000-07:00

Equities ended volatile session in deep red on the settlement day of October F&O series. Realty, metals and power led the fall while
Sensex FMCG and pharma stocks showed some strength.

Bombay Stock Exchange’s Sensex closed at 16052, down 230.90 points or 1.42 per cent. The index touched a high of 16264.09 and low of 15993.83 during the day.

National Stock Exchange’s Nifty ended at 4749.70, down 76.45 points or 1.58 per cent. The broader index hit a low of 4738.40 and high of 4826.10.

BSE Midcap Index was down 2.09 per cent and BSE Smallcap Index was 1.35 per cent lower.

Amongst the sectoral indices, BSE Realty Index was down 6.33 per cent, BSE Metal Index fell 2.61 per cent and BSE Power Index slipped 2.27 per cent. BSE FMCG Index was up 0.50 per cent and BSE Healthcare Index gained 0.26 per cent.

Sensex gainers were Mahindra & Mahindra (3.62%), ONGC (1.61%), Sun Pharmaceuticals (1.47%), Hindustan Unilever (0.83%) and HDFC (0.82%).

DLF (-7.33%), Reliance Communications (-7.09%), Jaiprakash Associates (-4.52%), ICICI Bank (-4.07%) and BHEL (-3.64%) ended with losses.

Market breadth was negative on the BSE with 1860 declines and 818 advances.

Economic Times

Pranab asks states to accelerate aided projects

2009-10-28T08:29:00.000-07:00

Finance Minister Pranab Mukherjee today asked states to expedite implementation of externally- aided projects so that the benefits of development could reach the poor and the country's image is enhanced abroad.

"(An)...Area of primary concern is a slow progress of externally-aided projects. Effective implementation of these projects not only benefits the areas of projects’ locations, but also enhances our image abroad and with the multilateral financial agencies," he said at a conference of state finance secretaries.

Several multilateral lending agencies like the World Bank and the Asian Development Bank (ADB) have been stressing on a speedier implementation of the aided-projects. India is estimated to have paid over Rs 700 crore as commitment charges to such agencies during the five-year period ending 2008-09.

The Finance Minister also asked the states to prepare the necessary groundwork for implementation of infrastructure projects in the Public Private Partnership (PPP) mode.

"There is need to create an enabling environment by way of a suitable policy framework and create a shelf of PPP projects which could be taken up for financing".

The state governments, he said, should consider the PPP model for implementing various infrastructure projects.

Pointing out that lack of adequate infrastructure was the bane of the Indian economy, Mukherjee said the Eleventh Plan target of raising investment in this sector to 9 per cent of the GDP by 2011-12 required extensive use of the PPP mode for implementing projects.

"As the huge investment requirements for infrastructure development cannot be met entirely from budgetary resources of both the Centre and the states, therefore, the PPP model of infrastructure development is being encouraged", he said.

Mukherjee also made a case for reverting to the path of fiscal prudence as the global economy has started showing initial signs of recovery.

The imperatives of addressing the economic crisis, he added, "should not make us ignore the longer-term agenda of addressing fiscal stability and providing welfare to our people.

"It is expected that once the global economy begins to recover, the state governments would re-affirm their commitment to fiscal responsibility and be back onto the path of fiscal consolidation," he said.

On financial inclusion, Mukherjee said, states need to provide infrastructural facilities, connectivity and a secure environment to enable the banks to provide banking facilities in unbanked and under-banked areas.

Expressing concern over low credit-deposit ratios in certain states, Mukherjee said, it was imperative that the state governments should create an enabling environment for banks to lend and to recover their dues.

The forum of State Level Bankers’ Committee, he added, should be used by the state governments to improve the credit-deposit ratios and ensure effective implementation of government schemes and initiatives.

The states where the participation in the SLBCs is high have witnessed significant improvement in the flow of funds from the banking sector, he said.

The meeting is being attended also by Minister of State for Finance Namo Narayan Meena, Finance Secretary Ashok Chawla and representatives from finance departments of the states and Union Territories (UTs).

Business Standard

HCL Tech Q1 net sales up 4.23% at Rs 3,031.4 cr

2009-10-28T08:25:00.000-07:00

HCL Technologies has declared its first quarter FY10 results. Its consolidated net profit went down 3.03% at Rs 320 crore versus Rs 330 crore, on quarter-on-quarter basis (QoQ). Net profit without forex losses stood at Rs 470.5 crore versus Rs 418.9 crore, a growth of 12.3%.

Net sales increased 4.23% to Rs 3,031.4 crore as against Rs 2,908.5 crore, (QoQ).

Numbers were above the street expectations. CNBC-TV18 was expecting net profit at Rs 303.5 crore and net sales at Rs 2,976.6 crore.

EBIDTA (earning before interest, depreciation, tax and amortisation) margin improved to 22.7% versus 22.1% (QoQ). EBIDTA was up 6.9% to Rs 688 crore versus Rs 644.1 crore.

The company reported forex loss at Rs 151 crore versus Rs 89 crore (QoQ).

                                       Rev Growth    Margins
Consolidated IT services 4.6% QoQ   23.6% vs 22.9%
BPO Services                  0.8% QOQ 14.3% vs 15.1%

Margins ( $ performance)

                  EBIDTA margins    EBIT margins

Q1                22.7%                    18%
Q4                22.1%                    18%
Q3                21.3%                    16.4%
Q2                22.5%                    18.5%
Q1                22.4%                    18.6%Q4                23.4%                    19.5%

Money Control

Cipla Q2 net profit rises 82 pc to Rs 275.74 cr

2009-10-28T08:16:00.000-07:00

Pharma major Cipla Ltd today said its net profit rose by 82.08 per cent to Rs 275.74 crore for the second quarter ended September 30,
2009, over the same period last fiscal.

Total income increased to Rs 1,455.7 crore in the latest quarter against Rs 1,369.7 crore in the same period last year, Cipla said in a filing to the Bombay Stock Exchange.

Shares of Cipla today closed at Rs 300.85 on the BSE, up 1.62 per cent from its previous close.

Economic Times

Nifty holds 4800 ahead of Oct F&O expiry

2009-10-28T08:02:00.000-07:00

Markets ended lower for the third straight day on Wednesday, ahead of October F&O expiry. Banks, auto and power stocks were amongst
Sensex

the beaten down sectors while realty stocks bounced back sharply to end in the positive terrain.

Indices opened on a weak note taking cues from other Asian markets and drifted lower. The benchmarks slipped below psychological supports but some buying in heavyweights helped the indices pull back. Lot of action was seen in the broader markets as well. They recovered sharply to close relatively on a flat note.

Bombay Stock Exchange’s Sensex ended at 16,283.49, down 69.91 points or 0.43 per cent. The index touched a low of 16,144.17 and high of 16,411.14.

National Stock Exchange’s Nifty ended at 4826.15, down 20.55 points or 0.42 per cent. The broader index hit a low of 4784.10 and high of 4867 intraday.

“The fall of Nifty from 4900 to sub-4800 levels was mainly on account of Delta hedging. Nifty is likely to close in the range of 4850-4900 tomorrow.

There are still short positions for next series and open interest has increased indicating a further correction in days to come. We are recommending traders to go short on every rise upto 5050 and expect targets of 4750 and 4350 in next two months,” said a senior derivative analyst from a local brokerage.

BSE Midcap Index, up 0.15 per cent, settled with marginal gains while BSE Smallcap Index moved 0.44 per cent lower.

Amongst the sectoral indices, BSE Bankex declined 1.5 per cent, BSE Auto Index fell 0.94 per cent and BSE Power Index slipped 0.83 per cent.

BSE Realty Index moved 0.88 per cent higher and BSE Oil&gas Index was up 0.69 per cent.

Biggest Sensex gainers were Ranbaxy Laboratories (3.77%), Jindal Steel (3.66%), Wipro (3.49%), Bharti Airtel (3.44%) and Tata Motors (2.49%).

Losers were Maruti Suzuki (-4.18%), Tata Steel (-3.63%), Suzlon Energy (-3.6%), HDFC (-3.49%), BPCL (-3.43%).

Market breadth on BSE remained negative with 1,627 declines outnumbering 1,059 advances.

European markets were in the red following sharp correction in banks and commodities. US stock futures were pointing towards a lower opening. At 5 pm IST, Dow Jones futures was down 0.51 per cent, S&P 500 moved 0.51 per cent lower and Nasdaq 100 edged 0.28 per cent lower.

Economic Times

Tata Steel Q2 net dips 49% to Rs 903 cr

2009-10-27T04:13:00.000-07:00

Tata Steel today reported a 49.49 per cent decline in net profit at Rs 902.94 crore for the second quarter ended September 30, 2009.

The steel major had a net profit of Rs 1,787.81 crore in the second quarter of FY'09, Tata Steel said in a filing to the Bombay Stock Exchange.

Total income also declined by 18.23 per cent to Rs 5,768.16 crore during the period, from Rs 7,054.33 crore in the corresponding period a year-ago.

The company would announce its consolidated figures, which would include Tata Steel Europe (Corus), for the second quarter and the six months ended September 30 by end of November 2009, it added.

Shares of Tata Steel were trading down 6.09 per cent over previous close at Rs 507.65 on BSE.

Times Of India

Nifty plunges to end near 4840; realty, metal tank

2009-10-27T04:09:00.000-07:00

Indian markets ended near day’s low Tuesday as sentiments turned bearish after the Reserve Bank of India’s credit policy review. All the sectors ended in the red with realty, metals and banks in the lead.

National Stock Exchange’s Nifty closed at 4841.40, down 129.50 points or 2.61 per cent. The broader index touched a low of 4829.50 and high of 4970.55.

Bombay Stock Exchange’s Sensex ended at 16330.60, down 409.90 points or 2.45 per cent. The index hit a low of 16311.50 and high of 16699.09.

BSE Midcap Index was down 3.71 per cent and BSE Smallcap Index slipped 4.33 per cent.

At its monetary policy review, the Reserve bank of India left all key rates unchanged. The central bank hiked SLR to 25% from 24%. The reverse repo rate was left unchanged at 3.25% and CRR at 5%. The inflation target has been hiked to 6.5% from 5% while the FY10 GDP target remains unchanged at 6% with upward bias.

The Reserve Bank of India increased provisioning for commercial real estate loans to 1 percent from 0.4 percent for standard assets. This had a negative impact on realty shares.

BSE Realty Index plunged 6.11 per cent, BSE Metal Index fell 5.76 per cent and BSE Bankex Index fell 3.97 per cent.

Reliance Capital (-8.06%), Hindalco Industries (-7.87%), Unitech (-7.71%), Reliance Communications (-6.91%) and Bharti Airtel (-6.84%) suffered massive losses.

Biggest Nifty gainers were Wipro (2.24%), Tata Motors (1.41%). Sun Pharmaceuticals (1.19%), BPCL (0.81%) and Cipla (0.47%).

Market breadth was extremely negative with 2274 declines outnumbering 453 advances on BSE.

Economic Times

RBI may hike CRR by year end: Experts

2009-10-27T03:56:00.000-07:00

The Reserve Bank of India (RBI) on Tuesday, while announcing the second-quarter review of monetary policy, left the key rates unchanged but hiked the statutory liquidity ratio (SLR). It also tightened non-performing asset (NPA) norms and made lending to the real estate tougher. The March 2010 target for inflation was also raised to 6.5% from 5% earlier. How are the changes going to impact the economy, industries, equity markets, bonds, liquidity and growth among others? Experts discuss

Policy reactions

The hiking of the statutory liquidity ratio (SLR) — the minimum amount banks to need keep with themselves — was primarily done to contain the government’s borrowing programme and not liquidity, feels Haseeb Drabu, Chairman of Jammu & Kashmir Bank. He added that the biggest takeaway was the tightening of NPA norms.

“One of the weakest things about the Indian banking space has been the NPA coverage and that has been hiked to about 70% now, which is a good thing for the long term but at the moment [it could be a negative].”

RBI being hawkish

“The RBI definitely has a hawkish tone,” said Sonal Varma of Nomura. “It’s been clear that the exit from the loose policy is going go be liquidity withdrawal first, rate hikes later,” she added pointing out that the central bank had stopped its open market operations (OMO) and may now proceed to hike the cash reserve ratio by the year end.

“Overall, clearly, the RBI is getting worried about inflation. Another thing that the RBI has mentioned is excess liquidity fueling into asset prices,” she said. “The RBI is getting worried about asset prices increasing fast and that possibly explains the provisional risk weights that have been increased on the real estate sector.”

Bonds to stay range-bound

Nilesh Shah, Managing Director of ICICI Prudential, said the government may resort to a two-pronged way. “You can’t just tame inflation with rate hikes and curbing liquidity. India’s answer to inflation not necessarily lies in rising interest rates, tightening liquidity and curtailing demand, it also lies along with that in giving liquidity, creating supply and creating capacity.”

Shah added that the bond markets were already pricing in high inflation and the lower remaining government borrowing may help yields to not spike up sharply. “For the time being, 7–7.5% on the 10-year looks like a likely range,” Shah said.

Stock market impact

The hiking of the SLR may not have a tangible impact on stock market liquidity, said Dipan Mehta, member of the Bombay Stock Exchange (BSE). The markets on Tuesday reacted negatively and the Nifty plunged over 100 points. “The RBI policy has just been the trigger where now the reality of interest rate hikes is in a matter of months, not years. I think the market is just factoring it in,” Mehta said. “Maybe you could see this continuation for a few more trading sessions.”

Money Control

Wipro projects $1.11 billion earning from IT services in third quarter

2009-10-27T03:53:00.000-07:00

Wipro Ltd on Tuesday projected an earning of $1.11 billion from IT services for third quarter (October-December) of this (fiscal 2009-10), as revenue for second quarter (July-September) at $1.06 billion was higher than the guidance of $1.03 billion.

"We expect revenues from our IT services business to be in the range of $1.09-1.11 billion in the third quarter, as we see more stability in volumes and pricing," Wipro chairman Azim Premji said in a statement here.

In a regulatory filing earlier, the IT bellwether said net profit for the second quarter increased by 19 percent year-on-year (YoY) to Rs.11.62 billion, as per the Indian accounting standard.

The net profit is higher than the projection of Rs.10.6 billion by analysts who keep track of Indian blue chip firms in the technology space.

But consolidated revenue for the quarter under review (Q2) increased modestly by six percent YoY to Rs.69.17 billion, as per the Indian accounting standard.

According to the International Financial Regulatory Standard (IFRS), the company's net income at $243 million increased by 21 percent YoY, while total revenue increased by six percent YoY to $1.44 billion.

Revenue from IT services at $.106 billion was, however, four percent lower YoY though sequentially higher by 3.2 percent, as per the IFRS.

"Our broad portfolio of services and strong delivery excellence continue to position us as a partner of choice with customers," Premji noted.

Operating margins for IT services increased by 143 basis points to 23.8 percent sequentially and 279 basis points on annualized basis.

In rupee terms, revenue from IT services at Rs.49.96 billion is an increase of five percent YoY and 3.5 percent sequentially.

"Our unwavering commitment to operational improvements continues to pay dividend, resulting in double-digit sequential growth in net profit," Wipro chief financial officer Suresh Senapaty said in the statement.

The IT services business added 37 clients during the quarter.

The company's IT products business recorded 18 percent YoY growth to Rs.11.83 billion, while consumer care and lighting grew by 11 percent YoY to Rs.5.87 billion.

With voluntary attrition marginally increasing to 10.5 percent from 8.4 percent in the first quarter (April-June) and involuntary attrition to 3.1 percent from 1.9 percent in the same period this fiscal, the headcount for IT services business decreased by 630 people to 97,891 from 98,521 sequentially.

On annualised basis, the headcount has increased by 330 people from 97,552 in the second quarter of last fiscal.

Economic Times

Infosys faces rising taxes, competition - Barron's

2009-10-25T20:58:00.000-07:00

Shares of Infosys Technologies Ltd could be headed for a fall as the company approaches the expiration of some beneficial tax breaks and rising competition from its peers, according to a report by Barron's.

Infosys was an early adoptor of certain tax benefits, making it face expiration of these perks earlier than its peers, Barron's reported in its electronic edition.

Susquehanna analyst James Friedman told Barron's that the expiration of the tax benefits could push Infosys's tax rate toward or above 25 percent, up from 13 percent in fiscal 2009.

Meanwhile, competition is rising, and Infosys' profit margins could suffer if it increases wages to catch up to its peers. Also, the rise in the rupee's rise and any move by India to raise benchmark interest rates to fight inflation could hurt Infosys.

Friedman has a price target on the stock of $37. Shares of Infosys's American depositary receipts closed on Friday at $48.58.

Reuters

Indian bond yields seen ranged; U.S. yields could hurt

2009-10-25T20:48:00.000-07:00

Indian federal bond yields are expected to be rangebound on Monday, a day before a much-awaited policy review, but higher U.S. yields and lack of clarity on the hold-to-maturity (HTM) limit hike front for banks could weigh.

* The 10-year benchmark bond closed at 7.45 percent on Friday, after rising to 7.47 percent, which was its highest since Sept. 11. It had ended at 7.38 percent on Thursday.

* Dealers said some amount of bargain buying in early trade could push yields marginally lower.

* Traders are mixed about whether the central bank would announce the much-anticipated hike in the HTM limit for banks' debt holdings, which would allow them to keep more bonds in a separate account, free from mark-to-market risks.

* "There is no compulsion over the Reserve Bank of India right now to raise the HTM cap, and finance ministry is not pushing for it," a finance ministry official, who did not wish to be named, told Reuters last week. [ID:nBMA006210]

* India's central bank will keep its benchmark lending and borrowing rates on hold in its quarterly policy review on Oct. 27, a Reuters poll showed earlier this month. [ID:nBOM432800]

* U.S. Treasury debt prices slipped on Friday after news that home sales surged last month and ahead of next week's record-large wave of government notes supply.

Reuters

Four-stage auction for 3G spectrum

2009-10-24T22:29:00.000-07:00

The Department of Telecom has said 3G spectrum will be auctioned in four stages: invitation stage, pre-qualification, auction and grant of spectrum. It will hold a pre-bid conference on November 16. A mock auction will be conducted on January 11 and 12. “The auction will start on January 14, 2010,” DoT said.

“Interested foreign entities are allowed to participate in the auctions directly and apply for licences subsequently,” says the revised information memorandum, which sets forth eligibility criteria and time schedule.

Compared with the original plan announced by the Empowered Group of Ministers, there is a slippage of more than two weeks.

The memorandum also gives details of the spectrum charges the successful bidders will have to shell out over the spectrum acquisition fee. An annual spectrum charge will be levied on the total adjusted gross revenue of 2G and 3G services taken together.

However, there will be a moratorium of one year on the payment of annual spectrum charges for standalone 3G operators. However, the existing operators with 2G as well as 3G spectrum will not enjoy any moratorium.

As for the roll-out obligation, the memorandum says that in the metros, the licensee should provide service in at least 90 per cent of the area within five years.

The memorandum also gives details of the number of blocks available in each circle for auction. The Empowered Group of Ministers had earlier said five blocks of spectrum would be auctioned in each circle, with one block reserved for the BSNL and the MTNL. However, there is no block available for auction in Rajasthan and North East.

Hindu

Maruti Suzuki post a net profit of INR 570 crore in Q2

2009-10-24T22:26:00.000-07:00

Favourable conditions like stimulus package of the Government, buoyant semiurban markets, low interest rates, improved financing by Government banks, low inflation and low oil prices have helped Maruti Suzuki Ltd to post INR 570 crore net profit for the second quarter ended September 30th 2009. This is against INR 296.12 crore recorded during the corresponding quarter previous fiscal.

The release added that the company has registered net sales of INR 7,049.6 crore during the quarter as compared with INR 4806.26 crore during the previous fiscal.

For the first half of 2009-10, net profit was up at INR 1,153.5 crore and net sales were up at INR 13,389.8 crore.

During the quarter, domestic sales volume grew by 21.8% to 209,083 units led by new models such as Estilo, A-star and Ritz as well as Alto, Swift, Swift DZire and Wagon R.

Business Line