Oil and Natural Gas Corporation (ONGC) has taken control of Imperial Energy Plc for 1.3 billion pound ($1.9 billion) after an overwhelming 96.8 per cent of London-listed firm's total shareholders accepted its takeover offer.
The deadline for the state-owned firm's 12.50 pounds per share offer closed yesterday and 99,241,110 or 96.8 per cent of the shares were tendered, ONGC Videsh (OVL) informed the London Stock Exchange.
ONGC Chairman R S Sharma said the company owed the acquisition to the government support, which has seen OVL in the past seven years increase its number of projects to 39 in 17 countries, from just a single project in Vietnam.
OVL, the overseas arm of the state explorer, needed 90 per cent shareholders to approve its deal, which will result in delisting of Imperial.
Imperial will be delisted from LSE after it "squeezes out" the remaining untendered shares by posting them cheques of the offer amount and telling the shareholders that these untendered shares were no longer valid.
Imperial, the Leeds-based firm that has oil producing blocks in Tomsk region of western Siberia in Russia and Kastanai in north-central Kazakhstan, would be the biggest overseas ever acquisition by OVL.
It had paid $1.7 billion to buy a 20 per cent stake in Exxon Mobil Corp's Sakhalin-I field in Russia and $785 million for a stake in the Greater Nile project in Sudan, both in 2003.
OVL will fund the transaction through a combination of loans from the parent company worth $1 billion-equivalent rupee loan. ONGC would lend close to $1-billion to fund the transaction at 5.96 per cent interest rate.
The entire acquisition and subsequent delisting may take two to three weeks, the source added.
Wednesday, December 31, 2008
Tuesday, December 23, 2008
Essar withdraws Jamnagar SEZ plan
Mumbai-based infrastructure conglomerate Essar group has withdrawn its plans to build a 1,125 hectare Special Economic Zone (SEZ) in Jamnagar (Gujarat) because of the adverse economic environment, a commerce ministry official said.
The proposal was to set up a 16-20-million-metric-tonne-a-year petrochemical refinery at an investment of Rs 15,000 crore, one of the largest SEZ proposals, according to information available on the company’s website.
The Essar SEZ had received “formal approval”, a second-stage approval that means the project had land in its possession (an earlier stage is when SEZs receive “in-principle approval”, when their plans are approved but the land has not been acquired).
Essar did not respond to an email questionnaire asking why it had withdrawn and seeking details of its alternative plans.
The development comes soon after India’s largest realtor, DLF Ltd withdrew a “notified” SEZ in Delhi owing to doubts about its financial viability. Notification, which is the final approval for any SEZ application, makes the zone eligible for tax benefits under the SEZ Act of 2005.
Essar’s project was, however, already facing a controversy over the declaration of land.
In August this year Essar had requested the Board of Approval (BoA), an inter-ministerial approval body for these tax-free enclaves, to reduce the area of the SEZ to about a fifth of the originally proposed 1,125 hectare. Essar also wanted the zone re-classified from its original multi-product classification to one for petrochemicals and petroleum.
The department of revenue, which has a representative on the BoA, said the zone did not have the land in its possession and wanted to know how the zone received formal approval in these circumstances.
In its meeting on August 1, the BoA, which is chaired by Commerce Secretary Gopal K Pillai, had decided to examine the possibility of the developer misrepresenting facts.
The SEZ is located at a region where about 70 per cent of India’s imported crude lands through oil tankers. Essar already has a 10.5-million-tonne-a-year refinery at Vadinar in the area. Jamnagar also houses Reliance Industry Ltd’s 29-million-tonne SEZ-based refinery and 33-million-tonne export-oriented unit-based refinery.
Essar’s other SEZs in Gujarat include a 247-hectare engineering SEZ in Hazira, which is currently being developed.
The proposal was to set up a 16-20-million-metric-tonne-a-year petrochemical refinery at an investment of Rs 15,000 crore, one of the largest SEZ proposals, according to information available on the company’s website.
The Essar SEZ had received “formal approval”, a second-stage approval that means the project had land in its possession (an earlier stage is when SEZs receive “in-principle approval”, when their plans are approved but the land has not been acquired).
Essar did not respond to an email questionnaire asking why it had withdrawn and seeking details of its alternative plans.
The development comes soon after India’s largest realtor, DLF Ltd withdrew a “notified” SEZ in Delhi owing to doubts about its financial viability. Notification, which is the final approval for any SEZ application, makes the zone eligible for tax benefits under the SEZ Act of 2005.
Essar’s project was, however, already facing a controversy over the declaration of land.
In August this year Essar had requested the Board of Approval (BoA), an inter-ministerial approval body for these tax-free enclaves, to reduce the area of the SEZ to about a fifth of the originally proposed 1,125 hectare. Essar also wanted the zone re-classified from its original multi-product classification to one for petrochemicals and petroleum.
The department of revenue, which has a representative on the BoA, said the zone did not have the land in its possession and wanted to know how the zone received formal approval in these circumstances.
In its meeting on August 1, the BoA, which is chaired by Commerce Secretary Gopal K Pillai, had decided to examine the possibility of the developer misrepresenting facts.
The SEZ is located at a region where about 70 per cent of India’s imported crude lands through oil tankers. Essar already has a 10.5-million-tonne-a-year refinery at Vadinar in the area. Jamnagar also houses Reliance Industry Ltd’s 29-million-tonne SEZ-based refinery and 33-million-tonne export-oriented unit-based refinery.
Essar’s other SEZs in Gujarat include a 247-hectare engineering SEZ in Hazira, which is currently being developed.
Monday, December 22, 2008
UK's largest union backs govt bailout for Tata's JLR
Tata Motors' case for state financial aid for Jaguar Land Rover today received support from Britain's biggest trade union, which wants the government to provide help by Christmas, as Tata has injected more cash into the company.
Tony Woodley, joint general secretary of Unite, said there was little reason for the British government not to act now that Tata Motors had injected more cash.
Jaguar Land Rover, which employs 15,000 people in Britain, was reported to have received "tens of millions" from Tata Motors, which will stave off an immediate cashflow crisis.
Tony Woodley, joint general secretary of Unite, said there was little reason for the British government not to act now that Tata Motors had injected more cash.
Jaguar Land Rover, which employs 15,000 people in Britain, was reported to have received "tens of millions" from Tata Motors, which will stave off an immediate cashflow crisis.
Tatas to raise Rs 15k cr more
Rating downgrades may make fund mop-up difficult
Hit by domestic slowdown and recession in the West, corporate giant Tatas are striving to raise over Rs 15,000 crore on top of the Rs 13,000 crore it got from the sale of equity in a telecom subsidiary.
Resource mobilisations through public offer of debt securities, sale of Tata Motors' vehicle loan pool, private equity placement and soliciting public deposits apart, the group is also seeking support from the UK and Dutch governments for rescuing its prized purchases Corus and Jaguar-Land Rover.
While Tatas' discussions with the governments in Britain and Netherlands have not taken a final shape either way, the market regulator has asked for clarifications on an open offer related to the sale of 26 per cent equity in Tata Teleservices to Japan's NTT DoCoMo. The company refused to comment on the development.
There were also no response on the quantum and options of fund mobilisation, but estimates show that it could be in the range of Rs 15,000 crore to Rs 20,000 crore.
After initiating the process for raising about Rs 2,700 crore through public deposits, Tata Motors is believed to be mulling to raise about Rs 10,000 crore by selling its vehicle loan pool, most probably to a group company. At the same time, another group entity Tata Capital is looking to raise about Rs 1,000 crore through a public offer of debt securities. The same company is also planning to raise about $350-500 million (about Rs 2,000 crore) through the private equity route.
The various fund-raising plans coincides with a string of rating downgrades for some group companies such as Tata Motors, Tata Steel and Tata Chemicals by credit rating agencies, including Standard and Poor's and Moody's — a development that makes raising debts difficult and costlier.
The group, whose automotive arm is seeking a £1 billion (about Rs 7,000 crore) financial aid from the government in the UK for its British unit Jaguar and Land Rover, has also sought assistance for Corus employees in Europe.
On the front of NTT DoCoMo deal, an open offer was announced on November 14 and the Securities and Exchange Board of India (Sebi) was subsequently approached by the merchant banker of the offer, Lazard India Private, on December 1 for the regulatory go-ahead. According to the latest information available on Sebi's website, "reply (is) awaited from MB (merchant banker) on clarifications sought" regarding the Rs 949-crore open offer.
On Tata Motors, rating agency Crisil has said that the "performance of retail finance portfolio of Tata Motors and Tata Motors Finance has been weak," and pointed to higher rate of default by its borrowers to 9.7 per cent in November, 2008 from 6.2 per cent in September 2007. "The vehicle financing business of Tata Motors and Tata Motors Finance disbursed Rs 10,300 crore of loans in 2007-08 (April 1 to March 31), as against Rs 9,400 crore in 2006-07." About its public deposit scheme, through which it can raise up to Rs 2,700 crore, a Tata Motors spokesperson had said earlier in the month this was for "ongoing requirement."
"We also believe that from the investor's point of view, it is an appropriate fixed-income instrument, in the light of the current market environment."
The company met with a cold response from investors recently in its bid to raise up to Rs 7,200 crore through sale of shares to existing equity holders for part funding the JLR deal and promoters had to chip in to save the issue that closed in October.
Hit by domestic slowdown and recession in the West, corporate giant Tatas are striving to raise over Rs 15,000 crore on top of the Rs 13,000 crore it got from the sale of equity in a telecom subsidiary.
Resource mobilisations through public offer of debt securities, sale of Tata Motors' vehicle loan pool, private equity placement and soliciting public deposits apart, the group is also seeking support from the UK and Dutch governments for rescuing its prized purchases Corus and Jaguar-Land Rover.
While Tatas' discussions with the governments in Britain and Netherlands have not taken a final shape either way, the market regulator has asked for clarifications on an open offer related to the sale of 26 per cent equity in Tata Teleservices to Japan's NTT DoCoMo. The company refused to comment on the development.
There were also no response on the quantum and options of fund mobilisation, but estimates show that it could be in the range of Rs 15,000 crore to Rs 20,000 crore.
After initiating the process for raising about Rs 2,700 crore through public deposits, Tata Motors is believed to be mulling to raise about Rs 10,000 crore by selling its vehicle loan pool, most probably to a group company. At the same time, another group entity Tata Capital is looking to raise about Rs 1,000 crore through a public offer of debt securities. The same company is also planning to raise about $350-500 million (about Rs 2,000 crore) through the private equity route.
The various fund-raising plans coincides with a string of rating downgrades for some group companies such as Tata Motors, Tata Steel and Tata Chemicals by credit rating agencies, including Standard and Poor's and Moody's — a development that makes raising debts difficult and costlier.
The group, whose automotive arm is seeking a £1 billion (about Rs 7,000 crore) financial aid from the government in the UK for its British unit Jaguar and Land Rover, has also sought assistance for Corus employees in Europe.
On the front of NTT DoCoMo deal, an open offer was announced on November 14 and the Securities and Exchange Board of India (Sebi) was subsequently approached by the merchant banker of the offer, Lazard India Private, on December 1 for the regulatory go-ahead. According to the latest information available on Sebi's website, "reply (is) awaited from MB (merchant banker) on clarifications sought" regarding the Rs 949-crore open offer.
On Tata Motors, rating agency Crisil has said that the "performance of retail finance portfolio of Tata Motors and Tata Motors Finance has been weak," and pointed to higher rate of default by its borrowers to 9.7 per cent in November, 2008 from 6.2 per cent in September 2007. "The vehicle financing business of Tata Motors and Tata Motors Finance disbursed Rs 10,300 crore of loans in 2007-08 (April 1 to March 31), as against Rs 9,400 crore in 2006-07." About its public deposit scheme, through which it can raise up to Rs 2,700 crore, a Tata Motors spokesperson had said earlier in the month this was for "ongoing requirement."
"We also believe that from the investor's point of view, it is an appropriate fixed-income instrument, in the light of the current market environment."
The company met with a cold response from investors recently in its bid to raise up to Rs 7,200 crore through sale of shares to existing equity holders for part funding the JLR deal and promoters had to chip in to save the issue that closed in October.
Poor sales push luxury brands to discounts
Offer 30 to 50% price-offs as buyers stay away.
Fearing a drop in sales with corporate India facing job insecurity and pay cuts, luxury brands like Gucci, Jimmy Choo, Bottega Venetta, Salvatore Ferragamo, Ermenegildo Zegna, Moschino and Charriol have started offering discounts of 30 to 50 per cent on Autumn/Winter 2008 collections.
Earlier this week, Salvatore Ferragamo began offering 30 per cent discounts. Menswear and accessories brand Ermenegildo Zegna, too, is offering 30 per cent off on clothes and 40 per cent off on belts and shoes plus gift vouchers worth Rs 10,000 if the bill exceeds Rs 100,000 after discounts.
Even Gucci, the iconic Italian fashion and leather goods label, has deviated from its no-discounts policy for the first time and is offering 50 per cent off on selected bags and shoes in one of the most important months for luxury sales. The starting price for Gucci’s products is Rs 30,000 and for limited editions, upwards of Rs 150,000.
Globally, luxury and premium retailers had advanced their sales by a month to October as developed economies headed into recession. Likewise in India, sales are being held in December instead of January.
"Business is low as footfalls and spending has reduced. To increase volumes we are having our sales early this season in December instead of January," said Mohan Murjani, chairman of the Murjani Group which has introduced brands like Gucci, shoe and bag brand Jimmy Choo and Bottega Venetta, a luxury leather goods maker, in India.
These sales, he added, will only help the company meet it sales targets but would mean a decrease in profitability.
"The aspiring class is holding back on buying luxury goods, so there is an inventory build-up," explains Abhay Gupta, executive director of Blues Clothing Company, Versace’s exclusive franchisee in India.
“During a slowdown, luxury is the first segment to take a hit,” said Rajiv Popley, director of Popley and Sons and purveyors of luxury brand watches like Tag Heuer, Omega and Vertu (the British luxury mobile phone). “As such, we expect our luxury brands to take a dip of 10 to 15 per cent."
The Indian luxury market is estimated to be worth $1 billion. The market, according to an AT Kearney report, is slated to touch $30 billion by 2015.
The spenders, noted the report, are industrialists or owners of small businesses (49 per cent) and professionals from the aspiring class -- the corporate sector (29 per cent), followed by IT/ BPO (8 per cent), and others like doctors, lawyers, media and finance professionals.
Luxury goods marketers are basing their numbers on the fact that companies are cutting back on compensation packages and bonuses. "About 40 per cent of Indian organisations this year are looking at very conservative bonus payouts. This will have an impact across the board," said Sandeep Chaudhary, business leader, consulting, for India, Middle East and SAARC, Hewitt Associates.
The news is worse for senior-level executives in the Rs 1 crore compensation range. "Thirty-five to 50 per cent of senior executives’ compensation is variable pay and this will be impacted 20 to 25 per cent this year. Also, stock options, which account for 40 per cent of the annual pay of top-paid executives, are also down to 10 per cent," he added.
Fearing a drop in sales with corporate India facing job insecurity and pay cuts, luxury brands like Gucci, Jimmy Choo, Bottega Venetta, Salvatore Ferragamo, Ermenegildo Zegna, Moschino and Charriol have started offering discounts of 30 to 50 per cent on Autumn/Winter 2008 collections.
Earlier this week, Salvatore Ferragamo began offering 30 per cent discounts. Menswear and accessories brand Ermenegildo Zegna, too, is offering 30 per cent off on clothes and 40 per cent off on belts and shoes plus gift vouchers worth Rs 10,000 if the bill exceeds Rs 100,000 after discounts.
Even Gucci, the iconic Italian fashion and leather goods label, has deviated from its no-discounts policy for the first time and is offering 50 per cent off on selected bags and shoes in one of the most important months for luxury sales. The starting price for Gucci’s products is Rs 30,000 and for limited editions, upwards of Rs 150,000.
Globally, luxury and premium retailers had advanced their sales by a month to October as developed economies headed into recession. Likewise in India, sales are being held in December instead of January.
"Business is low as footfalls and spending has reduced. To increase volumes we are having our sales early this season in December instead of January," said Mohan Murjani, chairman of the Murjani Group which has introduced brands like Gucci, shoe and bag brand Jimmy Choo and Bottega Venetta, a luxury leather goods maker, in India.
These sales, he added, will only help the company meet it sales targets but would mean a decrease in profitability.
"The aspiring class is holding back on buying luxury goods, so there is an inventory build-up," explains Abhay Gupta, executive director of Blues Clothing Company, Versace’s exclusive franchisee in India.
“During a slowdown, luxury is the first segment to take a hit,” said Rajiv Popley, director of Popley and Sons and purveyors of luxury brand watches like Tag Heuer, Omega and Vertu (the British luxury mobile phone). “As such, we expect our luxury brands to take a dip of 10 to 15 per cent."
The Indian luxury market is estimated to be worth $1 billion. The market, according to an AT Kearney report, is slated to touch $30 billion by 2015.
The spenders, noted the report, are industrialists or owners of small businesses (49 per cent) and professionals from the aspiring class -- the corporate sector (29 per cent), followed by IT/ BPO (8 per cent), and others like doctors, lawyers, media and finance professionals.
Luxury goods marketers are basing their numbers on the fact that companies are cutting back on compensation packages and bonuses. "About 40 per cent of Indian organisations this year are looking at very conservative bonus payouts. This will have an impact across the board," said Sandeep Chaudhary, business leader, consulting, for India, Middle East and SAARC, Hewitt Associates.
The news is worse for senior-level executives in the Rs 1 crore compensation range. "Thirty-five to 50 per cent of senior executives’ compensation is variable pay and this will be impacted 20 to 25 per cent this year. Also, stock options, which account for 40 per cent of the annual pay of top-paid executives, are also down to 10 per cent," he added.
Wednesday, December 17, 2008
BMW India announces opening of Platino Classic in Kochi
BMW India announced opening of Platino Classic, its dealership in Kochi. Platino Classic brings to Kochi the BMW standards of sales and service and the same international experience as any BMW dealership worldwide.
The showroom and workshop are headed by P P Ashique, Managing Director, Platino Classic. This is our 12th dealership of BMW in India.
Peter Kronschnabl, president, BMW India said, “With Kochi we also get access to Kerala which is an important market for us.”
The showroom and workshop covers approximately 11500 square feet (sq ft) of space.
The showroom is evolved on the signature-BMW concept of street display and the pavement flanking alongside as the customer area.
The workshop will have 4 service bays and 1 diagnostic bay capable of servicing 15-20 cars a day.
The showroom and workshop are headed by P P Ashique, Managing Director, Platino Classic. This is our 12th dealership of BMW in India.
Peter Kronschnabl, president, BMW India said, “With Kochi we also get access to Kerala which is an important market for us.”
The showroom and workshop covers approximately 11500 square feet (sq ft) of space.
The showroom is evolved on the signature-BMW concept of street display and the pavement flanking alongside as the customer area.
The workshop will have 4 service bays and 1 diagnostic bay capable of servicing 15-20 cars a day.
Saturday, December 13, 2008
ONGC's technical experts object to Imperial deal
The scientific and technical officers of Oil & Natural Gas Corporation, or ONGC, have objected to the company's decision to go ahead with the $2.1 billion acquisition of Imperial Energy of the UK, saying that the deal is over-valued and the assets not financially viable.
The Association of Scientific and Technical Officers (ASTO), the largest organisation of ONGC officers, has written to Petroleum Secretary R S Pandey and ONGC Chairman R S Sharma, complaining that the cost of acquisition and field development cannot be recovered since production at Imperial’s assets are in inhospitable geographies.
ONGC’s overseas arm, ONGC Videsh (OVL), on Wednesday posted bid documents for its 1,250 pence-a-share cash offer for Imperial Energy, tabled in August after getting the go-ahead from the Cabinet Committee on Economic Affairs (CCEA). That time, Imperial shares were trading at just 1,050 pence in the open market. The offer will be open till December 30, after which OVL will have two weeks to pay Imperial’s shareholders who tender their shares.
Crude oil has dropped 60 per cent since ONGC first offered to buy Imperial in August. This steep fall, along with the depreciation of the rupee against the dollar, has taken the sheen out of the deal.
“The quality of the deal is questionable. Russian companies such as Rosneft have refused to partner in the deal at this cost. It seems that Rosneft is aware of the real conditions of the field and the real worth of Imperial Energy,” Amit Kumar, president- central working committee of ASTO, said in the letter.
OVL’s bid gave the company a 10 per cent internal rate of return (IRR), taking crude oil at $121 a barrel, but with the fall of the rupee and crude oil the IRR has come down to 3-4 per cent.
“The current crude (oil) production of the company (Imperial) is close to 12,000 barrels a day only. This figure is also debatable as the technical team that visited the fields found that the production was around 8,000 barrels a day. The upside of production, as being planned, calls for huge investments in the field in addition to the investment being made to acquire the company. The field terrain is very tough and inhospitable,” said ASTO.
The access to the field for any developmental work and operations remains open for only five to six months in a year — that, too, in winters. “In this scenario, the anticipated increase in production is going to be tough and may not meet the targets set forth in coming years. It may also be noted that the production from this field can only be brought to the country at a very high cost,” said the association.
The Association of Scientific and Technical Officers (ASTO), the largest organisation of ONGC officers, has written to Petroleum Secretary R S Pandey and ONGC Chairman R S Sharma, complaining that the cost of acquisition and field development cannot be recovered since production at Imperial’s assets are in inhospitable geographies.
ONGC’s overseas arm, ONGC Videsh (OVL), on Wednesday posted bid documents for its 1,250 pence-a-share cash offer for Imperial Energy, tabled in August after getting the go-ahead from the Cabinet Committee on Economic Affairs (CCEA). That time, Imperial shares were trading at just 1,050 pence in the open market. The offer will be open till December 30, after which OVL will have two weeks to pay Imperial’s shareholders who tender their shares.
Crude oil has dropped 60 per cent since ONGC first offered to buy Imperial in August. This steep fall, along with the depreciation of the rupee against the dollar, has taken the sheen out of the deal.
“The quality of the deal is questionable. Russian companies such as Rosneft have refused to partner in the deal at this cost. It seems that Rosneft is aware of the real conditions of the field and the real worth of Imperial Energy,” Amit Kumar, president- central working committee of ASTO, said in the letter.
OVL’s bid gave the company a 10 per cent internal rate of return (IRR), taking crude oil at $121 a barrel, but with the fall of the rupee and crude oil the IRR has come down to 3-4 per cent.
“The current crude (oil) production of the company (Imperial) is close to 12,000 barrels a day only. This figure is also debatable as the technical team that visited the fields found that the production was around 8,000 barrels a day. The upside of production, as being planned, calls for huge investments in the field in addition to the investment being made to acquire the company. The field terrain is very tough and inhospitable,” said ASTO.
The access to the field for any developmental work and operations remains open for only five to six months in a year — that, too, in winters. “In this scenario, the anticipated increase in production is going to be tough and may not meet the targets set forth in coming years. It may also be noted that the production from this field can only be brought to the country at a very high cost,” said the association.
Saturday, November 8, 2008
Berkshire Hathaway Q3 net slips 77% $1.06 bn
Billionaire Warren Buffett-led Berkshire Hathaway Inc has posted a 76.78 per cent decline in net earnings at $ 1.06 billion for the third quarter ended September 30, on falling returns in insurance businesses and investment losses.
The company had a net earnings of $4.55 billion in the same quarter last year, Berkshire Hathaway said in a statement.
This is reportedly the longest streak of quarterly declines in at least 13 years, on falling returns at insurance businesses and investment losses.
"The timing and magnitude of catastrophe losses incurred by insurance subsidiaries and the estimation error inherent to the process of determining liabilities for unpaid losses of insurance subsidiaries can be relatively more significant to results of interim periods than to results for a full year," it said.
The derivatives losses of the company have widened for the third quarter to $1.26 billion as against $122 million in the corresponding period a year ago.
For the nine months ended September 30, Berkshire Hathaway has posted net earnings of $4.87 billion, a 52.49 per cent decline from $10.26 billion last year.
On October 1, Berkshire invested five billion dollar in Goldman Sachs' perpetual preferred stock. The preferred stock has a stated dividend rate of 10 per cent and is callable at any time at a 10 per cent premium.
Further, On October 16, Berkshire invested $3 billion in General Electric Company's perpetual preferred stock. The preferred stock has a stated dividend rate of 10 per cent and is callable after three years at a 10 per cent premium.
The company had a net earnings of $4.55 billion in the same quarter last year, Berkshire Hathaway said in a statement.
This is reportedly the longest streak of quarterly declines in at least 13 years, on falling returns at insurance businesses and investment losses.
"The timing and magnitude of catastrophe losses incurred by insurance subsidiaries and the estimation error inherent to the process of determining liabilities for unpaid losses of insurance subsidiaries can be relatively more significant to results of interim periods than to results for a full year," it said.
The derivatives losses of the company have widened for the third quarter to $1.26 billion as against $122 million in the corresponding period a year ago.
For the nine months ended September 30, Berkshire Hathaway has posted net earnings of $4.87 billion, a 52.49 per cent decline from $10.26 billion last year.
On October 1, Berkshire invested five billion dollar in Goldman Sachs' perpetual preferred stock. The preferred stock has a stated dividend rate of 10 per cent and is callable at any time at a 10 per cent premium.
Further, On October 16, Berkshire invested $3 billion in General Electric Company's perpetual preferred stock. The preferred stock has a stated dividend rate of 10 per cent and is callable after three years at a 10 per cent premium.
Tata Comm CEO among 10 global influential telecom people
Global Telecoms Business, a journal for communications service providers around the world, has named Tata Communications (formerly VSNL) CEO N Srinath has been as one of the 10 most influential telecom personnel.
Among the top 100 telecom personnel named by the magazine, N Srinath has been positioned at number 8. He has been credited for transforming Tata Communications in an international company and for the acquisition of networks like Teleglobe and Tyco Global Networks.
The list tops with Google Chairman and CEO Eric Schmidt, and Apple CEO Steve Jobs at number two.
Other Indians in the list are Bharti Enterprises Chairman and Group CEO Sunil Bharti Mittal (at number 35), Bharti Airtel CEO and Joint MD Manoj Kohli (number 39) and CEO of Motorola’s mobile services division Sanjay Jha (number 41).
Tata Communications’ President of global data and mobility solutions Vinod Kumar at number 68 and former CEO of Vodafone Arun Sarin at 71 are other Indian in the list.
Among the top 100 telecom personnel named by the magazine, N Srinath has been positioned at number 8. He has been credited for transforming Tata Communications in an international company and for the acquisition of networks like Teleglobe and Tyco Global Networks.
The list tops with Google Chairman and CEO Eric Schmidt, and Apple CEO Steve Jobs at number two.
Other Indians in the list are Bharti Enterprises Chairman and Group CEO Sunil Bharti Mittal (at number 35), Bharti Airtel CEO and Joint MD Manoj Kohli (number 39) and CEO of Motorola’s mobile services division Sanjay Jha (number 41).
Tata Communications’ President of global data and mobility solutions Vinod Kumar at number 68 and former CEO of Vodafone Arun Sarin at 71 are other Indian in the list.
Monday, September 1, 2008
Hyundai to launch 800cc car by 2011-12
Hyundai Motor India Limited (HMIL), a wholly owned subsidiary of Hyundai Motor Company, is planning to launch its 800cc small car by 2011-12.
Heung Soo Lheem, Managing Director of HMIL, said "We are planning to introduce 800 cc small sized car within 2011-12 but not to fight the Nano since we do not have the capability to manufacture Rs1 lakh cars. By the time this car will be launched in the Indian market, demand for small cars will be about two million units."
Research and development (R&D) work for the new car has already started at R&D centres in Hyderabad and Namyam (Korea).
Unlike Maruti 800 sold in the domestic market, the HMIL car would cater to domestic and export markets, added Lheem.
HMIL currently had capacity of manufacturing 20,000 units per month and 600,000 units per year at its two manufacturing units.
Of its total sales, 55 per cent was from the domestic market and 42 per cent from exports last year.
HMIL promised a preview of its i20 car, with code name PB, in the hatchback syle, at the Auto Tariff Show on October 2, in Paris.
In the eastern region, HMIL reported market share of 17 per cent last year with its i10 range now outselling the Santro.
HMIL under its Corporate Social Responsibility (CSR) programme, would be backing the Student Traffic Volunteer Scheme (STVS) of the traffic arm of Kolkata Police.
The scheme would develop road safety awareness and help in traffic management.
The Student Traffic Volunteer Scheme was first introduced in Delhi in 2006 followed by Chennai.
Lheem said, "The Student Traffic Volunteer Scheme which started in New Delhi in 2006 has been very successful scheme, so much so, that we have inducted 100 more volunteers in the scheme this year. We feel priviledged to be partnering Kolkata Police in introducing the scheme."
Under the STVS scheme, student representatives will assist the traffic police in controlling traffic at intersections like Jawaharlal Nehru road, Raja bazaar, Shyam Bazaar, Park Circus, besides organising parking of vehicles in commercial areas and educating pedestrians about traffic rules.
HMIL would support this initiative financially by giving out stipends to all 80 student volunteers selected out of 350 candidates.
Hyundai sponsored insurance cover for students against accident or injury.
Heung Soo Lheem, Managing Director of HMIL, said "We are planning to introduce 800 cc small sized car within 2011-12 but not to fight the Nano since we do not have the capability to manufacture Rs1 lakh cars. By the time this car will be launched in the Indian market, demand for small cars will be about two million units."
Research and development (R&D) work for the new car has already started at R&D centres in Hyderabad and Namyam (Korea).
Unlike Maruti 800 sold in the domestic market, the HMIL car would cater to domestic and export markets, added Lheem.
HMIL currently had capacity of manufacturing 20,000 units per month and 600,000 units per year at its two manufacturing units.
Of its total sales, 55 per cent was from the domestic market and 42 per cent from exports last year.
HMIL promised a preview of its i20 car, with code name PB, in the hatchback syle, at the Auto Tariff Show on October 2, in Paris.
In the eastern region, HMIL reported market share of 17 per cent last year with its i10 range now outselling the Santro.
HMIL under its Corporate Social Responsibility (CSR) programme, would be backing the Student Traffic Volunteer Scheme (STVS) of the traffic arm of Kolkata Police.
The scheme would develop road safety awareness and help in traffic management.
The Student Traffic Volunteer Scheme was first introduced in Delhi in 2006 followed by Chennai.
Lheem said, "The Student Traffic Volunteer Scheme which started in New Delhi in 2006 has been very successful scheme, so much so, that we have inducted 100 more volunteers in the scheme this year. We feel priviledged to be partnering Kolkata Police in introducing the scheme."
Under the STVS scheme, student representatives will assist the traffic police in controlling traffic at intersections like Jawaharlal Nehru road, Raja bazaar, Shyam Bazaar, Park Circus, besides organising parking of vehicles in commercial areas and educating pedestrians about traffic rules.
HMIL would support this initiative financially by giving out stipends to all 80 student volunteers selected out of 350 candidates.
Hyundai sponsored insurance cover for students against accident or injury.
Crorepati CEO club gets 219 new members
As a result, the crorepati club (those earning more than Rs 1 crore annually) saw 219 new entrants, taking the total membership to 596.
The list of crorepati CEOs could be much longer — some HR consultants say it would more than double to between 1,200 and 1,400 people — if one includes senior executives from unlisted companies, including the big international firms, management consultancies and foreign banks, investment bankers, unlisted retail billionaires and sundry others.
Consultants estimate that top salaries in sectors like retail and management consulting would be between Rs 5 crore and Rs 7 crore.
Tech Mahindra had the highest number (10) of senior executives drawing a Rs 1 crore-plus salary. Larsen & Toubro and Tata Motors had eight each; Nagarjuna Constructions seven and Aditya Birla Nuvo, Bharat Forge and Indian Hotels six each.
Thirty of the new members in the crorepati club were from newly-listed companies and 53 entered the bracket by switching jobs. The compensation package of 88 CEOs more than doubled over the previous year, although the number of those drawing Rs 10 crore-plus salaries was unchanged at 18.
Collectively, these executives from 298 companies took home Rs 1,524 crore from salaries, commissions and perquisites (excluding stock options and deferred pay).
The aggregate net profit of these 298 companies increased by the same level of 34.5 per cent at Rs 1,21,454 crore (Rs 90,327 crore) in FY08, but employee cost jumped 26 per cent to Rs 76,124 crore (Rs 60,257 crore). The share of director remuneration to net profit has been almost constant in the last four years at 1.09 per cent.
For the second year in a row, Reliance ADAG Group Chairman Anil Ambani has toppled his elder brother, Reliance Industries Chairman Mukesh Ambani as the highest-paid Indian CEO.
KAUN BANA CROREPATI
(CEO remuneration in Rs crore)
Name Flagship company 2007 2008
Anil Ambani * Reliance Comm 32.34 48.01
Mukesh Ambani Reliance Ind 30.46 44.02
Kalanithi Maran Sun TV Network 23.26 32.41
Kavery Kalanithi Sun TV Network 23.26 32.41
P R R Rajha Madras Cement 24.78 32.39
Kumar Mangalam Birla Grasim Ind 17.53 20.14
Malvinder Mohan Singh Ranbaxy Lab 6.57 19.58
Sunil Bharti Mittal Bharti Airtel 14.96 19.55
Sajjan Jindal JSW Steel 13.25 16.73
Onkar S Kanwar Apollo Tyres 9.98 15.54
*Includes Rs 34.65-crore proposed commission for FY08 by Reliance Comm
While Mukesh took home a total compensation of Rs 44.02 crore (Rs 30.46 crore in the previous year), Anil is set to get Rs 47.98 crore (Rs 32.34 crore).
The catch is the younger Ambani has so far received Rs 13.2 crore as commissions (his salary was a mere Rs 11 lakh) even though five months have gone by since the end of the last financial year.
That is because the Reliance Communications (RCom) remunerations committee and the board are yet to approve disbursal of the Rs 35-crore commission.
But that’s a mere formality, and going by the proportion last year, Anil Ambani’s share in the total commission to be paid by RCom will be Rs 34.65 crore.
The company disbursed the commission for 2006-7 only in the next financial year, and Anil’s share in the total commission of Rs 30.33 lakh was Rs 30 lakh. On his part, Mukesh received a commission of Rs 42.75 crore and a salary of Rs 1.27 crore.
While Mukesh Ambani’s commission was 0.21 per cent of the combined net profit of his group companies, the amount Anil Ambani received was almost one per cent of his group’s net profit of Rs 4,905 crore in FY08.
The list of crorepati CEOs could be much longer — some HR consultants say it would more than double to between 1,200 and 1,400 people — if one includes senior executives from unlisted companies, including the big international firms, management consultancies and foreign banks, investment bankers, unlisted retail billionaires and sundry others.
Consultants estimate that top salaries in sectors like retail and management consulting would be between Rs 5 crore and Rs 7 crore.
Tech Mahindra had the highest number (10) of senior executives drawing a Rs 1 crore-plus salary. Larsen & Toubro and Tata Motors had eight each; Nagarjuna Constructions seven and Aditya Birla Nuvo, Bharat Forge and Indian Hotels six each.
Thirty of the new members in the crorepati club were from newly-listed companies and 53 entered the bracket by switching jobs. The compensation package of 88 CEOs more than doubled over the previous year, although the number of those drawing Rs 10 crore-plus salaries was unchanged at 18.
Collectively, these executives from 298 companies took home Rs 1,524 crore from salaries, commissions and perquisites (excluding stock options and deferred pay).
The aggregate net profit of these 298 companies increased by the same level of 34.5 per cent at Rs 1,21,454 crore (Rs 90,327 crore) in FY08, but employee cost jumped 26 per cent to Rs 76,124 crore (Rs 60,257 crore). The share of director remuneration to net profit has been almost constant in the last four years at 1.09 per cent.
For the second year in a row, Reliance ADAG Group Chairman Anil Ambani has toppled his elder brother, Reliance Industries Chairman Mukesh Ambani as the highest-paid Indian CEO.
KAUN BANA CROREPATI
(CEO remuneration in Rs crore)
Name Flagship company 2007 2008
Anil Ambani * Reliance Comm 32.34 48.01
Mukesh Ambani Reliance Ind 30.46 44.02
Kalanithi Maran Sun TV Network 23.26 32.41
Kavery Kalanithi Sun TV Network 23.26 32.41
P R R Rajha Madras Cement 24.78 32.39
Kumar Mangalam Birla Grasim Ind 17.53 20.14
Malvinder Mohan Singh Ranbaxy Lab 6.57 19.58
Sunil Bharti Mittal Bharti Airtel 14.96 19.55
Sajjan Jindal JSW Steel 13.25 16.73
Onkar S Kanwar Apollo Tyres 9.98 15.54
*Includes Rs 34.65-crore proposed commission for FY08 by Reliance Comm
While Mukesh took home a total compensation of Rs 44.02 crore (Rs 30.46 crore in the previous year), Anil is set to get Rs 47.98 crore (Rs 32.34 crore).
The catch is the younger Ambani has so far received Rs 13.2 crore as commissions (his salary was a mere Rs 11 lakh) even though five months have gone by since the end of the last financial year.
That is because the Reliance Communications (RCom) remunerations committee and the board are yet to approve disbursal of the Rs 35-crore commission.
But that’s a mere formality, and going by the proportion last year, Anil Ambani’s share in the total commission to be paid by RCom will be Rs 34.65 crore.
The company disbursed the commission for 2006-7 only in the next financial year, and Anil’s share in the total commission of Rs 30.33 lakh was Rs 30 lakh. On his part, Mukesh received a commission of Rs 42.75 crore and a salary of Rs 1.27 crore.
While Mukesh Ambani’s commission was 0.21 per cent of the combined net profit of his group companies, the amount Anil Ambani received was almost one per cent of his group’s net profit of Rs 4,905 crore in FY08.
Friday, August 22, 2008
iPhone hits major Indian cities
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iPhone hits major Indian cities
Sandeep Joshi
NEW DELHI: The iconic touch-screen iPhone from the U.S.-technology major Apple was launched here at midnight on Thursday at glittering functions organised by the two leading mobile operators, Airtel and Vodafone Essar.
Priced at Rs. 31,000 for the 8 GB model and Rs. 36,100 for the 16 GB one, Apple has exclusively tied up with the two operators that will initially sell the latest iPhone 3G from their outlets in the four metros — Delhi, Mumbai, Chennai and Kolkata — besides Hyderabad and Bangalore. Apart from exclusive outlets of mobile operators, iPhone will also be available at Apple stores.
Both Airtel and Vodafone Essar will be selling the iPhone with non-cancellable contract, offering its users various data and other plans. Soon the Apple smartphone will be available in over 50 cities across India.
“We are offering an attractive bolt-on data plan , offering free 500 MB a month, for the first 12 months for all iPhone users, besides giving m-check e-commerce service and access to our portal Airtel Live,” said Sanjay Kapoor, Airtel’s President (Mobile Services).
Mr. Kapoor said iPhone users would typically be high-ARPU (average revenue per user) customers who were technologically savvy and wanted a best-in-class infotainment device.
Mr. Kapoor said over 2 lakh customers had pre-registered with Airtel after it announced plans to launch the phone in India about a fortnight ago. He, however, did not reveal the number of bookings. “The numbers would be out only after two weeks. But I can say the response has been very encouraging,” he added. Airtel has kept the advance money at Rs. 5,000 and the balance is to be paid at the time of delivery of the device; Vodafone is asking a booking amount of Rs. 10,000.
Asked about the high price of the iPhone compared to developed markets such as the U.S. where the mobile gadget costs the equivalent of Rs. 8,500, Mr. Kapoor said India was primarily a pre-paid market while the U.S. was mainly a post-paid market where phone bundling was not common. “We are offering various data and other packages with the iPhone, therefore the prices are high. An iPhone without bundling would cost the same as in other developed markets,” he added.
Referring to their sales strategy and support, Mr. Kapoor said: “To deliver world class experience in Airtel stores, we have extensively trained more than 3,000 employees in 41 towns in sales and service of the device.”
Advts: Retail Plus | Classifieds | Jobs | Obituary |
Front Page Printer Friendly Page Send this Article to a Friend
iPhone hits major Indian cities
Sandeep Joshi
NEW DELHI: The iconic touch-screen iPhone from the U.S.-technology major Apple was launched here at midnight on Thursday at glittering functions organised by the two leading mobile operators, Airtel and Vodafone Essar.
Priced at Rs. 31,000 for the 8 GB model and Rs. 36,100 for the 16 GB one, Apple has exclusively tied up with the two operators that will initially sell the latest iPhone 3G from their outlets in the four metros — Delhi, Mumbai, Chennai and Kolkata — besides Hyderabad and Bangalore. Apart from exclusive outlets of mobile operators, iPhone will also be available at Apple stores.
Both Airtel and Vodafone Essar will be selling the iPhone with non-cancellable contract, offering its users various data and other plans. Soon the Apple smartphone will be available in over 50 cities across India.
“We are offering an attractive bolt-on data plan , offering free 500 MB a month, for the first 12 months for all iPhone users, besides giving m-check e-commerce service and access to our portal Airtel Live,” said Sanjay Kapoor, Airtel’s President (Mobile Services).
Mr. Kapoor said iPhone users would typically be high-ARPU (average revenue per user) customers who were technologically savvy and wanted a best-in-class infotainment device.
Mr. Kapoor said over 2 lakh customers had pre-registered with Airtel after it announced plans to launch the phone in India about a fortnight ago. He, however, did not reveal the number of bookings. “The numbers would be out only after two weeks. But I can say the response has been very encouraging,” he added. Airtel has kept the advance money at Rs. 5,000 and the balance is to be paid at the time of delivery of the device; Vodafone is asking a booking amount of Rs. 10,000.
Asked about the high price of the iPhone compared to developed markets such as the U.S. where the mobile gadget costs the equivalent of Rs. 8,500, Mr. Kapoor said India was primarily a pre-paid market while the U.S. was mainly a post-paid market where phone bundling was not common. “We are offering various data and other packages with the iPhone, therefore the prices are high. An iPhone without bundling would cost the same as in other developed markets,” he added.
Referring to their sales strategy and support, Mr. Kapoor said: “To deliver world class experience in Airtel stores, we have extensively trained more than 3,000 employees in 41 towns in sales and service of the device.”
Wednesday, August 6, 2008
Apple's iPhone to hit Airtel outlets on August 22
Apple's iPhone, the touch screen handset that acquired a cult status in the US and other western countries, will be available to Indian mobile users through Bharti Airtel at the stroke of midnight on August 21, giving competitors like Nokia, Samsung and others a run for their money.
Millions of Airtel subscribers will be able to purchase the iPhone at Airtel's Relationship Centres from August 22, a company statement said here.
"iPhone has been an iconic technological revelation of this year and Airtel has been at the forefront of innovation and customer delight in the Indian telecom sector," Sanjay Kapoor, President, Bharti Airtel mobile services, said.
iPhone is embedded with all 3G features and is twice as fast as the existing mobile phones.
The phone also has in-built GPS system, that facilitates as a navigation and positioning tool.
US-based Apple has tied up with Airtel and Vodafone to bring iPhone in the country.
Asked at what price it will be available, Bharti Airtel officials declined to give details.
"Introducing iPhone in India further underscores Bharti's commitment to enrich the communication experience of Airtel users," Kapoor said.
Leading cell phone makers like Nokia, Motorola and Samsung have stepped up their R&D efforts to bring feature rich phones in India to compete iPhones.
Vodafone is also slated to bring Apples's iPhone this year.
Millions of Airtel subscribers will be able to purchase the iPhone at Airtel's Relationship Centres from August 22, a company statement said here.
"iPhone has been an iconic technological revelation of this year and Airtel has been at the forefront of innovation and customer delight in the Indian telecom sector," Sanjay Kapoor, President, Bharti Airtel mobile services, said.
iPhone is embedded with all 3G features and is twice as fast as the existing mobile phones.
The phone also has in-built GPS system, that facilitates as a navigation and positioning tool.
US-based Apple has tied up with Airtel and Vodafone to bring iPhone in the country.
Asked at what price it will be available, Bharti Airtel officials declined to give details.
"Introducing iPhone in India further underscores Bharti's commitment to enrich the communication experience of Airtel users," Kapoor said.
Leading cell phone makers like Nokia, Motorola and Samsung have stepped up their R&D efforts to bring feature rich phones in India to compete iPhones.
Vodafone is also slated to bring Apples's iPhone this year.
Friday, August 1, 2008
Harkishan Singh Surjeet passes away
The Marxist pioneer and former general secretary of the Communist Party of India (Marxist), Harkishan Singh Surjeet, who passed away on Friday, was a grand old revolutionary.
The end came at the Metro Hospital in Noida at 1.35 p.m. Hospitalised on May 6 following a respiratory crisis, the 92-year-old survivor of several transformative eras and health crises gradually slipped into a coma but recovered and was discharged. He was again hospitalised on July 7 following the onset of fever and lung infection. Doctors said a massive cardiac arrest combined with septicaemia due to persistent pneumonia was the cause of death.
Tributes came from all quarters. Prime Minister Manmohan Singh described him as a great political leader, a true patriot who was committed to the welfare of the downtrodden. President Pratibha Patil and Congress President Sonia Gandhi said his death was a loss not only to the Communist movement but to the entire country. BJP leader Lal Krishna Advani said that in Mr. Surjeet’s death Indian politics lost a veteran and the Marxist movement a dedicated activist.
Expressing profound grief at the passing away of Mr. Surjeet, the CPI(M) Polit Bureau said the party lost an outstanding leader and the country an authoritative representative of the Left and secular tradition. Hailing him as the “most authoritative spokesman for the Left and democratic forces in the country,” the Polit Bureau said Mr. Surjeet played a remarkable role in the defence of national unity and in formulating policies to counter the threat from divisive forces.
CPI(M) general secretary Prakash Karat said Mr. Surjeet was one of the builders of the Communist movement in the country and tirelessly worked for realising the goal of a classless society. Recalling his long association with the veteran Marxist leader, Mr. Karat said: “In his death, the Communist movement and progressive and secular forces have suffered an irreparable loss.”
The nonagenarian CPI(M) leader is survived by his wife, Pritam Kaur, their two sons and daughter. His body will be kept on Sunday morning at the party headquarters, AKG Bhavan, here. Cremation is scheduled to take place here in the evening.
The end came at the Metro Hospital in Noida at 1.35 p.m. Hospitalised on May 6 following a respiratory crisis, the 92-year-old survivor of several transformative eras and health crises gradually slipped into a coma but recovered and was discharged. He was again hospitalised on July 7 following the onset of fever and lung infection. Doctors said a massive cardiac arrest combined with septicaemia due to persistent pneumonia was the cause of death.
Tributes came from all quarters. Prime Minister Manmohan Singh described him as a great political leader, a true patriot who was committed to the welfare of the downtrodden. President Pratibha Patil and Congress President Sonia Gandhi said his death was a loss not only to the Communist movement but to the entire country. BJP leader Lal Krishna Advani said that in Mr. Surjeet’s death Indian politics lost a veteran and the Marxist movement a dedicated activist.
Expressing profound grief at the passing away of Mr. Surjeet, the CPI(M) Polit Bureau said the party lost an outstanding leader and the country an authoritative representative of the Left and secular tradition. Hailing him as the “most authoritative spokesman for the Left and democratic forces in the country,” the Polit Bureau said Mr. Surjeet played a remarkable role in the defence of national unity and in formulating policies to counter the threat from divisive forces.
CPI(M) general secretary Prakash Karat said Mr. Surjeet was one of the builders of the Communist movement in the country and tirelessly worked for realising the goal of a classless society. Recalling his long association with the veteran Marxist leader, Mr. Karat said: “In his death, the Communist movement and progressive and secular forces have suffered an irreparable loss.”
The nonagenarian CPI(M) leader is survived by his wife, Pritam Kaur, their two sons and daughter. His body will be kept on Sunday morning at the party headquarters, AKG Bhavan, here. Cremation is scheduled to take place here in the evening.
IAEA board approves India safeguards agreement
With the words “It is so decided” and the bang of the chairman’s gavel, the India safeguards agreement was adopted by the Board of Governors of the International Atomic Energy Agency on Friday evening.
In an indication of how significant the decision is for the arcane and often opaque world of nuclear politics, virtually every one of the 35 countries which make up the IAEA’s apex body took the floor to make statements either endorsing India’s case or, in the case of the majority, expressing reservations and qualifications of one kind or another. Three countries — Austria, Ireland and Switzerland — could barely disguise their unhappiness.
But in the end, the hard sell indulged in by the U.S. and India —and the strong backing the agreement received from IAEA Director General Mohammed ElBaradei — ensured that the text sailed through without a vote.
The meeting began at 10.40 a.m. and ran until lunch, by when all board members who wished to make statements prior to the adoption had spoken.
When the meeting reconvened two hours later, the BoG’s Chilean chair, Milenko E. Skoknic, summed up the discussion and suggested that the Director General be authorised to “conclude and implement” the safeguards agreement with India. He then looked around the room quickly to make sure that no delegation was raising its flag to call for a vote and reached for his gavel.
If those few seconds before the gavel sounded provided the only moments of tension for the Indian delegation during the day, the statement made by several countries at the meeting made it clear the battle to end India’s nuclear isolation has only been postponed to the Nuclear Suppliers Group.
Ireland, Austria, Japan and even Brazil pointedly declared that their going along with the consensus at the IAEA did not mean they would sit quiet when the 45-nation nuclear cartel discusses India’s case next month.
New Zealand, which spoke as an observer, said it did not wish to say much about the safeguards agreement since it was not a member of the BoG. But it said it would make its stand on India clear at the NSG.
The approval of the agreement pushes the Indo-U.S. nuclear deal one step closer towards the finishing line and paves the way for as many as eight additional Indian nuclear power reactors to come under international safeguards in phases once lifetime fuel supply arrangements for them are concluded. In all, India has undertaken to place 14 reactors under safeguards, six of which are already subject to inspections.
In a statement to the press after the Board meeting, Dr. Baradei expressed the hope that the agreement “would also be certified by the Suppliers Group.”
Speaking to reporters outside the boardroom, Department of Atomic Energy chairman Anil Kakodkar said “the significant point is that the safeguards agreement has been adopted by consensus.”
He hoped the NSG would give a clean and unconditional waiver to waiver.
In an indication of how significant the decision is for the arcane and often opaque world of nuclear politics, virtually every one of the 35 countries which make up the IAEA’s apex body took the floor to make statements either endorsing India’s case or, in the case of the majority, expressing reservations and qualifications of one kind or another. Three countries — Austria, Ireland and Switzerland — could barely disguise their unhappiness.
But in the end, the hard sell indulged in by the U.S. and India —and the strong backing the agreement received from IAEA Director General Mohammed ElBaradei — ensured that the text sailed through without a vote.
The meeting began at 10.40 a.m. and ran until lunch, by when all board members who wished to make statements prior to the adoption had spoken.
When the meeting reconvened two hours later, the BoG’s Chilean chair, Milenko E. Skoknic, summed up the discussion and suggested that the Director General be authorised to “conclude and implement” the safeguards agreement with India. He then looked around the room quickly to make sure that no delegation was raising its flag to call for a vote and reached for his gavel.
If those few seconds before the gavel sounded provided the only moments of tension for the Indian delegation during the day, the statement made by several countries at the meeting made it clear the battle to end India’s nuclear isolation has only been postponed to the Nuclear Suppliers Group.
Ireland, Austria, Japan and even Brazil pointedly declared that their going along with the consensus at the IAEA did not mean they would sit quiet when the 45-nation nuclear cartel discusses India’s case next month.
New Zealand, which spoke as an observer, said it did not wish to say much about the safeguards agreement since it was not a member of the BoG. But it said it would make its stand on India clear at the NSG.
The approval of the agreement pushes the Indo-U.S. nuclear deal one step closer towards the finishing line and paves the way for as many as eight additional Indian nuclear power reactors to come under international safeguards in phases once lifetime fuel supply arrangements for them are concluded. In all, India has undertaken to place 14 reactors under safeguards, six of which are already subject to inspections.
In a statement to the press after the Board meeting, Dr. Baradei expressed the hope that the agreement “would also be certified by the Suppliers Group.”
Speaking to reporters outside the boardroom, Department of Atomic Energy chairman Anil Kakodkar said “the significant point is that the safeguards agreement has been adopted by consensus.”
He hoped the NSG would give a clean and unconditional waiver to waiver.
Thursday, July 31, 2008
India second best country for business investment: Survey
India is the second best country for business investment, a new survey of American corporate executives shows.
Conducted by Development Counsellors International every three years, the "Winning Strategies in Economic Development Marketing" survey has tracked trends in economic development since its inception in 1996.
This is the first year respondents were asked to rank the business favourablity of the world's 25 largest countries (based on GDP).
Of the 281 corporate executives who responded, 53.1 per cent named China as the most favouable country followed by India (45.1 per cent), Mexico (30.1 per cent), Britain (25.4 per cent) and Canada (22 per cent).
The corporate decision-makers who named India as the best for investment cited the country's labour force - including its supply, skill level and cost 65 per cent of the time as the reason for their positive perceptions.
India's "growing economy/business opportunities" and "low overall/operating costs" were named 38 per cent and 18 per cent of the time, respectively. The survey also polled the executives about the best US states for business.
Conducted by Development Counsellors International every three years, the "Winning Strategies in Economic Development Marketing" survey has tracked trends in economic development since its inception in 1996.
This is the first year respondents were asked to rank the business favourablity of the world's 25 largest countries (based on GDP).
Of the 281 corporate executives who responded, 53.1 per cent named China as the most favouable country followed by India (45.1 per cent), Mexico (30.1 per cent), Britain (25.4 per cent) and Canada (22 per cent).
The corporate decision-makers who named India as the best for investment cited the country's labour force - including its supply, skill level and cost 65 per cent of the time as the reason for their positive perceptions.
India's "growing economy/business opportunities" and "low overall/operating costs" were named 38 per cent and 18 per cent of the time, respectively. The survey also polled the executives about the best US states for business.
Wednesday, July 23, 2008
Renault may revise Indian strategy
A year after its joint venture with Mahindra & Mahindra got off the ground, French car maker Renault has decided to revise its sales strategy for India following the Logan's lacklustre performance.
The JV begun selling the mid-sized sedan in April-May last year through M&M's dealerships across the country.
Patrick Blain, executive VP (sales and marketing) Renault, who was quoted in a report, said, "The (mid-size) segment has turned out to be smaller than we thought and we may need to revise our product strategy for the Indian market."
Renault had earlier targeted sales of 50,000 units in the local market by 2008-end. The company sold 12,715 cars in the first six months of this year, falling way below the target of 25,000-30,000 units.
Blain further said that it is unlikely that the targeted sales will be achieved by the joint company, Mahindra Renault Private Limited (MRPL), this year. The company produced less than 1,100 cars in June, a sharp decline from the earlier monthly production tally of more than 2,500 cars. Sales, too, fell by 11 per cent in the last quarter.
The fall in expectation of sales is generally due to the fact that the Indian market has been dominated by compact and fuel efficient cars, which constitute about 70 per cent of the total vehicle sales.
Nalin Mehta, VP (sales and marketing), MRPL, said, "The automobile sector is facing difficult times; the situation begun to tighten four months ago. No vehicle manufacturing company, including us, is thinking of expanding operations currently. The slowdown has impacted our sales as well."
Last year, the company planned to have 100 Logan dealers across the country but managed only 94. The target for the year is to have 150 dealers in place and company officials say that the dealer expansion programe will move ahead as planned despite the slowdown.
Accentuating the slowdown worries, the company doesn't expect the entry level mid-size segment to grow as planned, which, according to some analysts, should have been in the range of 12-14 per cent. The small car segment, meanwhile, grew by nearly 15 per cent in the April-June quarter.
The Logan, an entry level midsizer priced at Rs 4.25 lakh (ex-showroom Mumbai), is pegged against the Maruti Suzuki DZire, the Ford Ikon, the Hyundai Accent and the Tata Indigo. MRPL claims to have garnered a market share of 12 per cent in the segment through the Logan.
The company is also planning to introduce the Sandero, which is based on the Logan platform. However, these plans have been pushed to next year as the focus currently is fully on consolidating the Logan in the local market, added Mehta.
The JV is a 51:49 partnership between Mahindra and Renault, which has already infused about Rs 700 crore in setting up a greenfield facility in Nashik that has a production capacity of 50,000 units per annum. The facility has a stamping and a paint shop with a pre-treatment and an assembly line.
The JV begun selling the mid-sized sedan in April-May last year through M&M's dealerships across the country.
Patrick Blain, executive VP (sales and marketing) Renault, who was quoted in a report, said, "The (mid-size) segment has turned out to be smaller than we thought and we may need to revise our product strategy for the Indian market."
Renault had earlier targeted sales of 50,000 units in the local market by 2008-end. The company sold 12,715 cars in the first six months of this year, falling way below the target of 25,000-30,000 units.
Blain further said that it is unlikely that the targeted sales will be achieved by the joint company, Mahindra Renault Private Limited (MRPL), this year. The company produced less than 1,100 cars in June, a sharp decline from the earlier monthly production tally of more than 2,500 cars. Sales, too, fell by 11 per cent in the last quarter.
The fall in expectation of sales is generally due to the fact that the Indian market has been dominated by compact and fuel efficient cars, which constitute about 70 per cent of the total vehicle sales.
Nalin Mehta, VP (sales and marketing), MRPL, said, "The automobile sector is facing difficult times; the situation begun to tighten four months ago. No vehicle manufacturing company, including us, is thinking of expanding operations currently. The slowdown has impacted our sales as well."
Last year, the company planned to have 100 Logan dealers across the country but managed only 94. The target for the year is to have 150 dealers in place and company officials say that the dealer expansion programe will move ahead as planned despite the slowdown.
Accentuating the slowdown worries, the company doesn't expect the entry level mid-size segment to grow as planned, which, according to some analysts, should have been in the range of 12-14 per cent. The small car segment, meanwhile, grew by nearly 15 per cent in the April-June quarter.
The Logan, an entry level midsizer priced at Rs 4.25 lakh (ex-showroom Mumbai), is pegged against the Maruti Suzuki DZire, the Ford Ikon, the Hyundai Accent and the Tata Indigo. MRPL claims to have garnered a market share of 12 per cent in the segment through the Logan.
The company is also planning to introduce the Sandero, which is based on the Logan platform. However, these plans have been pushed to next year as the focus currently is fully on consolidating the Logan in the local market, added Mehta.
The JV is a 51:49 partnership between Mahindra and Renault, which has already infused about Rs 700 crore in setting up a greenfield facility in Nashik that has a production capacity of 50,000 units per annum. The facility has a stamping and a paint shop with a pre-treatment and an assembly line.
Thursday, July 17, 2008
TCS plans to reduce costs through HR
Tata Consultancy Services (TCS) which is on a cost control drive is planning to optimise cost through hiring mix with inducting more number of trainees compared to professionals.
The expenditure on human resources works out to 50 to 55 per cent of the reveneus of the company and it expects to optimise its cost through a proper mix of hiring trainees and profesionals.
Ajoyendra Mukherjee, Vice-President and Head, Global HR of TCS said here today in the first quarter last year, the company had a hiring mix of 62 per cent professionals and 38 per cent trainees. Whereas in the first quarter of this year, out of every 100 employees hired, 61 were trainees and 39 were professionals.
He said the trend will continue in the rest of the year as well with at least 60 per cent of new recruits being trainees.
He said the company is also plaaning to use employee referral system to reduce cost while hiring new people. He also informed the attrition in the company is leveling out with the company focussing on retaining high performers.
Meanwhile, the number of foreign nationals working with TCS has crossed the 10,000 mark which is a record for any Indian IT company.
The company which had only 3,691 employees in the year 1990-91 today has over 1,16,000 employees on its roll making it the largest employer in the IT industry in the country, according to a handout released by the company.
The expenditure on human resources works out to 50 to 55 per cent of the reveneus of the company and it expects to optimise its cost through a proper mix of hiring trainees and profesionals.
Ajoyendra Mukherjee, Vice-President and Head, Global HR of TCS said here today in the first quarter last year, the company had a hiring mix of 62 per cent professionals and 38 per cent trainees. Whereas in the first quarter of this year, out of every 100 employees hired, 61 were trainees and 39 were professionals.
He said the trend will continue in the rest of the year as well with at least 60 per cent of new recruits being trainees.
He said the company is also plaaning to use employee referral system to reduce cost while hiring new people. He also informed the attrition in the company is leveling out with the company focussing on retaining high performers.
Meanwhile, the number of foreign nationals working with TCS has crossed the 10,000 mark which is a record for any Indian IT company.
The company which had only 3,691 employees in the year 1990-91 today has over 1,16,000 employees on its roll making it the largest employer in the IT industry in the country, according to a handout released by the company.
VW`s Indian car soon
The story about India enticing world auto majors will add another feather in European giant Volkswagen's (VW) cap as it prepares for its first fully-original Indian Volkswagen car, made with the help of expertise provided by Indian engineers and designers.
The company, which is also Europe's largest car maker, will follow in the footsteps of Maruti Suzuki, India's biggest passenger vehicle maker, which is also preparing to launch a similar car in the next three to four years.
Makham Dhalivaal, managing director, Volkswagen (passenger cars), said, "This Volkswagen car will be made in India from scratch. However, the plans are at a developmental stage and it's too early too talk about it."
A number of characteristics ranging from the basic design of the car on paper to the end product will be done in India.
As seven out of every ten cars sold in India are compact vehicles, industry experts suggest that VW will look at the small car category, like Maruti Suzuki, to tap the volume segment of the Indian car market, which swelled to 1.5 million units last year.
Maruti Suzuki (MSIL) has already begun work on the India car and aims to launch the automobile by 2011-12.
Maruti's car, too, will be developed from scratch. The company aims to double the number of engineers to 1,000 from 480 by 2010.
Meanwhile, VW has reiterated that it is on course to launch the Indian version of the Polo hatchback, its international best selling small car. The car, which is currently under development, will be tailored to suit buyer preferences here and will be launched in 2010.
VW's aggressive India plans are based on the country's expertise in low cost of vehicle manufacturing, which has led a number of international automotive giants, including Renault, Nissan, Hyundai, Honda, Toyota, General Motors and Ford, to exploit manufacturing opportunities here and make India their international export base.
The company today launched the Jetta, its second product in the country, pegged in the premium D segment of cars. The Jetta, which will compete with Honda Civic, Hyundai Sonata, Toyota Corolla and Skoda Octavia, will be priced in the range of Rs 12.97-Rs 16.67 lakh (Ex-showroom Delhi). The car will available in three variants with a diesel option.
VW currently sells the Passat luxury car, which is slated against the Mercedes C Class and BMW 3 Series, and also the Touareg sports utility vehicle.
Both brands together sold a total of 340 cars in the first 6 months of this year. The Passat and Jetta are locally assembled at Skoda Auto's facility in Aurangabad. The company is targetting sales of 20,000 units by the end of this year from the VW, Audi and Skoda brands.
VW's plant in Chakan, Pune is one year ahead of schedule, said company officials today. The company will inject more than Rs 3,500 crore into the plant which will have an initial production capacity of 110,000 units initially. The plant is expected to go on stream in the first half of next year.
Furthermore, a team of experts will visit India next week to study market analysis for the company's proposed foray into the commercial vehicle (CV) industry.
The company has said in the past that it is exploring the option of launching CV's in the Indian market.
The company, which is also Europe's largest car maker, will follow in the footsteps of Maruti Suzuki, India's biggest passenger vehicle maker, which is also preparing to launch a similar car in the next three to four years.
Makham Dhalivaal, managing director, Volkswagen (passenger cars), said, "This Volkswagen car will be made in India from scratch. However, the plans are at a developmental stage and it's too early too talk about it."
A number of characteristics ranging from the basic design of the car on paper to the end product will be done in India.
As seven out of every ten cars sold in India are compact vehicles, industry experts suggest that VW will look at the small car category, like Maruti Suzuki, to tap the volume segment of the Indian car market, which swelled to 1.5 million units last year.
Maruti Suzuki (MSIL) has already begun work on the India car and aims to launch the automobile by 2011-12.
Maruti's car, too, will be developed from scratch. The company aims to double the number of engineers to 1,000 from 480 by 2010.
Meanwhile, VW has reiterated that it is on course to launch the Indian version of the Polo hatchback, its international best selling small car. The car, which is currently under development, will be tailored to suit buyer preferences here and will be launched in 2010.
VW's aggressive India plans are based on the country's expertise in low cost of vehicle manufacturing, which has led a number of international automotive giants, including Renault, Nissan, Hyundai, Honda, Toyota, General Motors and Ford, to exploit manufacturing opportunities here and make India their international export base.
The company today launched the Jetta, its second product in the country, pegged in the premium D segment of cars. The Jetta, which will compete with Honda Civic, Hyundai Sonata, Toyota Corolla and Skoda Octavia, will be priced in the range of Rs 12.97-Rs 16.67 lakh (Ex-showroom Delhi). The car will available in three variants with a diesel option.
VW currently sells the Passat luxury car, which is slated against the Mercedes C Class and BMW 3 Series, and also the Touareg sports utility vehicle.
Both brands together sold a total of 340 cars in the first 6 months of this year. The Passat and Jetta are locally assembled at Skoda Auto's facility in Aurangabad. The company is targetting sales of 20,000 units by the end of this year from the VW, Audi and Skoda brands.
VW's plant in Chakan, Pune is one year ahead of schedule, said company officials today. The company will inject more than Rs 3,500 crore into the plant which will have an initial production capacity of 110,000 units initially. The plant is expected to go on stream in the first half of next year.
Furthermore, a team of experts will visit India next week to study market analysis for the company's proposed foray into the commercial vehicle (CV) industry.
The company has said in the past that it is exploring the option of launching CV's in the Indian market.
Bosch makes open offer for 20% in Indian entity
German firm Robert Bosch GmbH today made a open offer to the shareholders of Bosch Chassis Systems India for acquiring 20 per cent stake in the company at a maximum price of Rs 600 per share.
As per the open offer Robert Bosch GmbH would acquire up to 4,158,906 equity shares of Rs 10 each representing 20 per cent of the fully paid-up equity share capital of its Indian entity, auto ancillary firm Bosch Chassis said in a filing to the Bombay Stock Exchange.
The offer is scheduled to open on August 4 and would close on August 8.
The Germany-based firm is the holding company of Robert Bosch LLC and Robert Bosch Investment Nederland B V, the promoters of Bosch Chassis Systems India.
The promoter holding in Bosch Chassis Systems India is 80 per cent of the total issued equity share capital of the company.
Pursuant to the open offer the promoter shareholding in Bosch Chassis Systems India would increase to 100 per cent and would entail the delisting of fully paid up equity shares of the company from the Bombay Stock Exchange and the National Stock Exchange.
The German firm would make the voluntary delisting offer to the public shareholders of Bosch Chassis Systems in accordance with the delisting guidelines.
The delisting offer would enhance operating flexibility of the company and would provide a second exit opportunity to the public shareholders of the company.
The price for the offer would be determined after the reverse book building process, the company said.
As per the open offer Robert Bosch GmbH would acquire up to 4,158,906 equity shares of Rs 10 each representing 20 per cent of the fully paid-up equity share capital of its Indian entity, auto ancillary firm Bosch Chassis said in a filing to the Bombay Stock Exchange.
The offer is scheduled to open on August 4 and would close on August 8.
The Germany-based firm is the holding company of Robert Bosch LLC and Robert Bosch Investment Nederland B V, the promoters of Bosch Chassis Systems India.
The promoter holding in Bosch Chassis Systems India is 80 per cent of the total issued equity share capital of the company.
Pursuant to the open offer the promoter shareholding in Bosch Chassis Systems India would increase to 100 per cent and would entail the delisting of fully paid up equity shares of the company from the Bombay Stock Exchange and the National Stock Exchange.
The German firm would make the voluntary delisting offer to the public shareholders of Bosch Chassis Systems in accordance with the delisting guidelines.
The delisting offer would enhance operating flexibility of the company and would provide a second exit opportunity to the public shareholders of the company.
The price for the offer would be determined after the reverse book building process, the company said.
Thursday, July 10, 2008
Off-shoring to India creates jobs in UK: Experts
Outsourcing work by British companies to India does not cause job losses but boosts employment, according to a research by economists at the University of Nottingham.
Scores of major UK companies have been involved in off-shoring, which has often been opposed by unions.
But the research by the Globalisation and Economic Policy centre (GEP) at the University of Nottingham says the efficiencies it has brought has actually boosted business and led to them employing more people in the UK, not less.
David Greenaway, Director of the centre, said: "People fear their jobs are being exported to countries like India and China where labour is cheaper, but the picture is far more complex than that and much more positive.
"It would seem that firms that off-shore part of their production process or service provision overseas become more efficient. This boosts productivity and turnover and as a result these firms grow and end up employing more people at home, not fewer."
The GEP research says there are losers when off- shoring takes place through higher job turnover and people are unable to adapt to new skills. Richard Kneller, who co-wrote the research, says it also explodes another myth about off-shoring.
He said: "The common perception of off-shoring is that it's largely low-paid call centre jobs being exported to lower wage economies like China and India, but that's not the case.
Scores of major UK companies have been involved in off-shoring, which has often been opposed by unions.
But the research by the Globalisation and Economic Policy centre (GEP) at the University of Nottingham says the efficiencies it has brought has actually boosted business and led to them employing more people in the UK, not less.
David Greenaway, Director of the centre, said: "People fear their jobs are being exported to countries like India and China where labour is cheaper, but the picture is far more complex than that and much more positive.
"It would seem that firms that off-shore part of their production process or service provision overseas become more efficient. This boosts productivity and turnover and as a result these firms grow and end up employing more people at home, not fewer."
The GEP research says there are losers when off- shoring takes place through higher job turnover and people are unable to adapt to new skills. Richard Kneller, who co-wrote the research, says it also explodes another myth about off-shoring.
He said: "The common perception of off-shoring is that it's largely low-paid call centre jobs being exported to lower wage economies like China and India, but that's not the case.
Wednesday, July 9, 2008
Ratan Tata to be conferred with Doctorate degree
Ratan Tata, chairman, Tata group of companies, Mumbai would be among the three eminent persons to be conferred with Degree of Doctor of Science (Honoris Causa), during the 29th Convocation of Tamil Nadu Agricultural University (TNAU) to be held here on July 25.
M Ramasami, managing director, Rasi Seeds (P) Ltd, Attur and Bhavarlal Hiralal Jain, chairman, Jain Irrigationl systems Ltd, Jalgoan, Maharashtra, would be the other two to be conferred with the degrees, a TNAU release said today.
Tamil Nadu Governor, Surjit Singh Barnala, in his capacity as the chancellor would preside over the convocation, while Pro-chancellor and state agriculture minister, Veerapandi S Arumugam would announce the endowment of prizes and release TN AU publications, it said.
Abhijit Sen, member, planning commission, New Delhi, would be the chief guest and deliver the convocation address.
A total of 996 candidates (52 boys and 494 girls) would receive the degrees, which includes undergraduates, masters an doctorate degrees on the occasion.
M Ramasami, managing director, Rasi Seeds (P) Ltd, Attur and Bhavarlal Hiralal Jain, chairman, Jain Irrigationl systems Ltd, Jalgoan, Maharashtra, would be the other two to be conferred with the degrees, a TNAU release said today.
Tamil Nadu Governor, Surjit Singh Barnala, in his capacity as the chancellor would preside over the convocation, while Pro-chancellor and state agriculture minister, Veerapandi S Arumugam would announce the endowment of prizes and release TN AU publications, it said.
Abhijit Sen, member, planning commission, New Delhi, would be the chief guest and deliver the convocation address.
A total of 996 candidates (52 boys and 494 girls) would receive the degrees, which includes undergraduates, masters an doctorate degrees on the occasion.
Thursday, June 26, 2008
Idea snaps up Spice
Spice valued at Rs 6,800 crore; TMI to get 14.99% in Idea.
India's fifth largest mobile phone company, Idea Cellular, today said it has agreed to buy BK Modi's 40.8 per cent stake in Spice Communications in an all-cash deal worth Rs 2,700 crore, including non-compete fees. The deal values Spice at around Rs 6,800 crore.
Idea will buy Spice Group's shares at a price of Rs 77.30 a share — a premium of 42 per cent to Tuesday's closing price — and make the mandatory open offer to Spice shareholders at the same rate. Spice's minority shareholders, who want to remain invested in the telecom industry and do not tender shares during the open offer, will be offered Idea Cellular shares at a later date.
Reacting to the announcement, Spice shares surged 33.1 per cent to a record close of Rs 72.35 in a market that rose 0.8 per cent. Idea was up 2 per cent at Rs 102.05 a share.
Idea will add about 4.5 million customers, closing in on Bharat Sanchar Nigam Ltd, the fourth-largest carrier. Besides, it will enter Punjab and Karnataka, which account for 11 per cent of India's total wireless subscribers.
"It will give us incumbent advantage in both these circles. We are now in the big league of telecom players in the country," Idea Chairman Kumar Mangalam Birla said here today.
According to the complex agreement, TM International (TMI), the Malaysian telecommunication giant holding 39.2 per cent stake in Spice, will swap its stake for Idea shares and will be offered 469 million shares by way of a preferential allotment of shares in Idea at a price of Rs 156.96 a share. This will take TMI's stake in idea to 14.99 per cent.
TMI will invest Rs 7,500 crore for buying this stake in Idea Cellular and a part of these funds will be used to buy Modi's stake. The balance Rs 4,500 crore will be used to retire the debts in Idea's books, Birla said. TMI will get one seat on Idea's board.
India's fifth largest mobile phone company, Idea Cellular, today said it has agreed to buy BK Modi's 40.8 per cent stake in Spice Communications in an all-cash deal worth Rs 2,700 crore, including non-compete fees. The deal values Spice at around Rs 6,800 crore.
Idea will buy Spice Group's shares at a price of Rs 77.30 a share — a premium of 42 per cent to Tuesday's closing price — and make the mandatory open offer to Spice shareholders at the same rate. Spice's minority shareholders, who want to remain invested in the telecom industry and do not tender shares during the open offer, will be offered Idea Cellular shares at a later date.
Reacting to the announcement, Spice shares surged 33.1 per cent to a record close of Rs 72.35 in a market that rose 0.8 per cent. Idea was up 2 per cent at Rs 102.05 a share.
Idea will add about 4.5 million customers, closing in on Bharat Sanchar Nigam Ltd, the fourth-largest carrier. Besides, it will enter Punjab and Karnataka, which account for 11 per cent of India's total wireless subscribers.
"It will give us incumbent advantage in both these circles. We are now in the big league of telecom players in the country," Idea Chairman Kumar Mangalam Birla said here today.
According to the complex agreement, TM International (TMI), the Malaysian telecommunication giant holding 39.2 per cent stake in Spice, will swap its stake for Idea shares and will be offered 469 million shares by way of a preferential allotment of shares in Idea at a price of Rs 156.96 a share. This will take TMI's stake in idea to 14.99 per cent.
TMI will invest Rs 7,500 crore for buying this stake in Idea Cellular and a part of these funds will be used to buy Modi's stake. The balance Rs 4,500 crore will be used to retire the debts in Idea's books, Birla said. TMI will get one seat on Idea's board.
Monday, June 23, 2008
Advani snubs Ranbaxy deal
Profit motives shouldn't override national interests, says BJP leader at the Business Standard annual awards function.
The Ranbaxy-Daiichi deal may have made global headlines, but that has hardly impressed L K Advani, leader of the Opposition, Lok Sabha.
"It's a cause for worry that an Indian company, known for its research & development capabilities and operating in a critical area like pharmaceuticals, has lost its identity to a foreign company," Advani said after giving away the Business Standard awards at a glittering function attended by a galaxy of business leaders in Mumbai on Saturday evening.
Though he did not name Ranbaxy, the signal from the Bharatiya Janata Party's (BJP's) prime ministerial candidate was clear.
Advani said he was aware that mergers and acquisitions were inevitable in a globalised world, but asked Indian industry to spare a thought for what he called the "third dimension".
"I am not trying to find fault with globalisation and profit motives. But these cannot override considerations of national interests," the BJP leader said, adding India Inc should guard against a monopoly situation in vital areas like pharmaceuticals.
"We need to think how such deals affect our poor people; and whether they can block access to drugs at a reasonable price," he said.
Ranbaxy promoters Malvinder Singh and family had sold their 34.81 per cent stake in India's largest pharmaceuticals company to Japan's Daiichi-Sankyo a fortnight ago. Daiichi has announced an open offer to take its stake in Ranbaxy to 51 per cent.
In his extempore speech, Advani also talked about the paradoxes in the Indian economy and stressed the need to make economic growth truly inclusive.
"India is seeing the fastest increase in the number of billionaires. But the plight of the poor is also deepening at an even faster pace. The challenge is to evolve an economic strategy which can bridge this ever-widening gap," Advani said.
The main reason for this paradox, Advani said, was the failure of successive governments and industry to recognise the fact that farmers were still not part of the economic growth process. "The root of the problem is the crisis in agriculture," he said.
Advani said India's software prowess was a matter of pride but the real challenge was to take information technology from urban areas to the countryside because that's what inclusive growth is all about.
The BJP leader said he agrees with management thinker C K Prahalad who has exhorted Indian industry to give serious thought to the value at the bottom of the pyramid.
"A whole new world will open up if we stop seeing the poor as victims or as a burden and start recognising then as resilient and creative entrepreneurs and value-conscious consumers," Advani said.
The veteran leader also didn't miss an opportunity to take a dig at the United Progressive Alliance government (UPA). Terming it as a government "in the ICU", Advani said the government has pushed itself in a corner over the Indo-US nuclear deal and the high inflation rate.
People certainly expected better management of the nation's economy from Manmohan Singh, who is known to be a distinguished economist, he said. "I am not a doctor. But here is the case of a doctor who has brought his own government to this critical pass," Advani said, giving flashes of his trademark humour.
Pointing out that the UPA government has written its own epitaph even before its formal exit, Advani blamed the coming together of the Congress and the Left on the bogus claim of unity of secular forces.
That the UPA has sealed its fate on the nuclear deal is evident from the fact that the Communists will withdraw support if the government goes ahead with operationalisation of the deal. On the other hand, if it once again chooses to retreat, the prime minister's credibility and authority, which were never high, will have all but evaporated, Advani said.
Convinced that Indians are now looking beyond the UPA government, Advani listed the challenges the next government would face: inflation, further acceleration and broadbasing of economic growth so that the fruits are enjoyed by the poorest, internal security threats and energy security.
Giving some indication of his party's economic manifesto for a "resurgent India", Advani said the agenda will be a strong and vibrant economy, revitalisation of agriculture, fixing the ills of small enterprises, a revolutionary expansion of high-quality education and a strong emphasis on urban renewal, specially for cities like Mumbai.
"We would like to evolve an Indian model of development as imitating the development model of any other country cannot solve India's problem," Advani said.
The CEO of the Year award was given to Sun Pharmaceuticals Chairman and Managing Director Dilip Shanghvi. Receiving the award, Shanghvi said the secret of Sun's success lay in its consistent ability to give the best pharma solutions at the lowest possible cost. Dedicating the award to his R&D team, he said Sun spends 12 per cent of its turnover on research.
O P Bhatt, chairman of State Bank of India, who received the Banker of the Year award, thanked Team SBI for its efforts to "wake up the SBI elephant from its slumber and make it dance."The Most Innovative Organisation of the Year award went to the Board of Control for Cricket in India (BCCI) for the Indian Premier League, which redefined the rules of the game.
Receiving the award, BCCI Vice-President Lalit Modi said it was a pleasant surprise for him as BCCI was not a company. He thanked his team, the 99 million TV audience and the over 2.5 million people who went to the cricket stadiums day after day to make IPL a grand success.
The award for the Equity Fund Manager of the Year was won by Sandeep Kothari of Fidelity Fund Management., while the honour of the Debt Fund Manager of the Year went to Suyash Chowdhary, a former fund manager at Standard Chartered Asset Management and now with HSBC Asset Management.
National Thermal Power Corporation won the Star PSU of the Year award, Cognizant Solutions was declared the Star Unlisted Company, Mico-Bosch won the Star MNC award and Praj Industries won the Star SME award.
Hyundai i10 won the BS Motoring Car of the Year award and Bajaj XCD 125 DTS-Si was chosen the BS Motoring Bike of the Year.
The Ranbaxy-Daiichi deal may have made global headlines, but that has hardly impressed L K Advani, leader of the Opposition, Lok Sabha.
"It's a cause for worry that an Indian company, known for its research & development capabilities and operating in a critical area like pharmaceuticals, has lost its identity to a foreign company," Advani said after giving away the Business Standard awards at a glittering function attended by a galaxy of business leaders in Mumbai on Saturday evening.
Though he did not name Ranbaxy, the signal from the Bharatiya Janata Party's (BJP's) prime ministerial candidate was clear.
Advani said he was aware that mergers and acquisitions were inevitable in a globalised world, but asked Indian industry to spare a thought for what he called the "third dimension".
"I am not trying to find fault with globalisation and profit motives. But these cannot override considerations of national interests," the BJP leader said, adding India Inc should guard against a monopoly situation in vital areas like pharmaceuticals.
"We need to think how such deals affect our poor people; and whether they can block access to drugs at a reasonable price," he said.
Ranbaxy promoters Malvinder Singh and family had sold their 34.81 per cent stake in India's largest pharmaceuticals company to Japan's Daiichi-Sankyo a fortnight ago. Daiichi has announced an open offer to take its stake in Ranbaxy to 51 per cent.
In his extempore speech, Advani also talked about the paradoxes in the Indian economy and stressed the need to make economic growth truly inclusive.
"India is seeing the fastest increase in the number of billionaires. But the plight of the poor is also deepening at an even faster pace. The challenge is to evolve an economic strategy which can bridge this ever-widening gap," Advani said.
The main reason for this paradox, Advani said, was the failure of successive governments and industry to recognise the fact that farmers were still not part of the economic growth process. "The root of the problem is the crisis in agriculture," he said.
Advani said India's software prowess was a matter of pride but the real challenge was to take information technology from urban areas to the countryside because that's what inclusive growth is all about.
The BJP leader said he agrees with management thinker C K Prahalad who has exhorted Indian industry to give serious thought to the value at the bottom of the pyramid.
"A whole new world will open up if we stop seeing the poor as victims or as a burden and start recognising then as resilient and creative entrepreneurs and value-conscious consumers," Advani said.
The veteran leader also didn't miss an opportunity to take a dig at the United Progressive Alliance government (UPA). Terming it as a government "in the ICU", Advani said the government has pushed itself in a corner over the Indo-US nuclear deal and the high inflation rate.
People certainly expected better management of the nation's economy from Manmohan Singh, who is known to be a distinguished economist, he said. "I am not a doctor. But here is the case of a doctor who has brought his own government to this critical pass," Advani said, giving flashes of his trademark humour.
Pointing out that the UPA government has written its own epitaph even before its formal exit, Advani blamed the coming together of the Congress and the Left on the bogus claim of unity of secular forces.
That the UPA has sealed its fate on the nuclear deal is evident from the fact that the Communists will withdraw support if the government goes ahead with operationalisation of the deal. On the other hand, if it once again chooses to retreat, the prime minister's credibility and authority, which were never high, will have all but evaporated, Advani said.
Convinced that Indians are now looking beyond the UPA government, Advani listed the challenges the next government would face: inflation, further acceleration and broadbasing of economic growth so that the fruits are enjoyed by the poorest, internal security threats and energy security.
Giving some indication of his party's economic manifesto for a "resurgent India", Advani said the agenda will be a strong and vibrant economy, revitalisation of agriculture, fixing the ills of small enterprises, a revolutionary expansion of high-quality education and a strong emphasis on urban renewal, specially for cities like Mumbai.
"We would like to evolve an Indian model of development as imitating the development model of any other country cannot solve India's problem," Advani said.
The CEO of the Year award was given to Sun Pharmaceuticals Chairman and Managing Director Dilip Shanghvi. Receiving the award, Shanghvi said the secret of Sun's success lay in its consistent ability to give the best pharma solutions at the lowest possible cost. Dedicating the award to his R&D team, he said Sun spends 12 per cent of its turnover on research.
O P Bhatt, chairman of State Bank of India, who received the Banker of the Year award, thanked Team SBI for its efforts to "wake up the SBI elephant from its slumber and make it dance."The Most Innovative Organisation of the Year award went to the Board of Control for Cricket in India (BCCI) for the Indian Premier League, which redefined the rules of the game.
Receiving the award, BCCI Vice-President Lalit Modi said it was a pleasant surprise for him as BCCI was not a company. He thanked his team, the 99 million TV audience and the over 2.5 million people who went to the cricket stadiums day after day to make IPL a grand success.
The award for the Equity Fund Manager of the Year was won by Sandeep Kothari of Fidelity Fund Management., while the honour of the Debt Fund Manager of the Year went to Suyash Chowdhary, a former fund manager at Standard Chartered Asset Management and now with HSBC Asset Management.
National Thermal Power Corporation won the Star PSU of the Year award, Cognizant Solutions was declared the Star Unlisted Company, Mico-Bosch won the Star MNC award and Praj Industries won the Star SME award.
Hyundai i10 won the BS Motoring Car of the Year award and Bajaj XCD 125 DTS-Si was chosen the BS Motoring Bike of the Year.
Friday, June 20, 2008
Double digit inflation hits India
The rate of inflation in India has galloped to a 13-year high to 11.05 per cent for the week ended June 7, confounding the worst fears of the United Progressive Alliance Government as general elections loom. This has been caused mainly by the June 5 increases in fuel prices and its cascading effect on all food commodities and other manufactured items, such as consumer durable goods and steel.
The unexpected spurt in the wholesale price index-based inflation from 8.75 per cent in the previous week evoked sharp criticism from all political parties, including the UPA’s coalition partners and Left allies, of the government’s failure to hold the price line and sustain the benefits of high growth.
Reserve Bank of India data show that the last time inflation was in double digits was in April-May 1995 when it ruled above 11 per cent.
The unexpected spurt in the wholesale price index-based inflation from 8.75 per cent in the previous week evoked sharp criticism from all political parties, including the UPA’s coalition partners and Left allies, of the government’s failure to hold the price line and sustain the benefits of high growth.
Reserve Bank of India data show that the last time inflation was in double digits was in April-May 1995 when it ruled above 11 per cent.
Tuesday, June 17, 2008
Leyland stakeholders may get equity in Nissan JV
Chennai-based Ashok Leyland (ALL), India's second-largest commercial vehicle maker, said today that it is evaluating the option of letting its shareholders invest in the joint venture companies with Nissan through a proper funding route.
Leyland is looking to raise Rs 600 crore for the joint venture facility located near Chennai, which is the equity participation of the company for the combined investment of about Rs 2,400 crore. Nissan will pump Rs 600 crore as equity, while the balance of about Rs 1,200 crore will be raised through debt.
K Sridharan, CFO, Ashok Leyland, said: "We are looking at prospects of (our) shareholders participating in the JV with Nissan. We aim to raise part or full amount of our equity participation in the joint venture for which we may look to incentivise our shareholders by providing them with some kind of entitlement." The official was speaking at an analyst meet here.
The company so far has not yet decided on the means to raise the required funding but stated that it was considering a preferential share issue, rights issue or convertible bonds, which will lead to scaling down of Ashok Leyland's holding in the three joint ventures.
Leyland is looking to raise Rs 600 crore for the joint venture facility located near Chennai, which is the equity participation of the company for the combined investment of about Rs 2,400 crore. Nissan will pump Rs 600 crore as equity, while the balance of about Rs 1,200 crore will be raised through debt.
K Sridharan, CFO, Ashok Leyland, said: "We are looking at prospects of (our) shareholders participating in the JV with Nissan. We aim to raise part or full amount of our equity participation in the joint venture for which we may look to incentivise our shareholders by providing them with some kind of entitlement." The official was speaking at an analyst meet here.
The company so far has not yet decided on the means to raise the required funding but stated that it was considering a preferential share issue, rights issue or convertible bonds, which will lead to scaling down of Ashok Leyland's holding in the three joint ventures.
Tuesday, June 10, 2008
Sensex crashes by 506 points
The rising concern over oil prices and inflationary pressures hit the stock markets again and the benchmark Bombay Stock Exchange (BSE) 30-share sensitive index (Sensex) lost 506.08 points or 3.25 per cent at 15066.10. Realty stocks are the major losers with 7.38 per cent drop followed by IT (4.21 per cent), oil and gas (3.29 per cent) and bank (3.21 per cent).
On the National Stock Exchange, the broader 50-share Nifty lost 126.85 points to close at 4500.95 against the previous close of 4624.80.
Rising crude oil prices is a major concern for the stock markets and the price of oil ruled high on Monday too at $137.7 a barrel. It surged to an all time high of $139.12 last Friday. Further, an increase in U.S. unemployment rate dampened sentiment on the bourses in the U.S. and other parts of the world. The U.S. markets are deeply affected by fears of a recession amid investor worry over further credit tightening while home values deteriorate.
On the National Stock Exchange, the broader 50-share Nifty lost 126.85 points to close at 4500.95 against the previous close of 4624.80.
Rising crude oil prices is a major concern for the stock markets and the price of oil ruled high on Monday too at $137.7 a barrel. It surged to an all time high of $139.12 last Friday. Further, an increase in U.S. unemployment rate dampened sentiment on the bourses in the U.S. and other parts of the world. The U.S. markets are deeply affected by fears of a recession amid investor worry over further credit tightening while home values deteriorate.
BSNL slashes STD tariffs by 50 %
The Bharat Sanchar Nigam Limited (BSNL) on Monday announced a 50 per cent reduction in STD charges on its mobile and landline networks.
Effective from midnight on Tuesday, landline users would pay Rs.1.20 per minute as against Rs.2.40 for STD calls to all networks. Rural customers would pay 80 paise per minute for STD calls.
The charges for intra-circle calls to BSNL network were also reduced from Rs.1.20 per minute to 60 paise with an increased pulse rate of two minutes.For mobile phone customers, STD charges were cut to Rs.1.20 per minute for the same network and Rs.1.40 for other networks.
Roaming charges under the pre-paid and the post-paid services were also revised. The roaming charges for all incoming calls were reduced — to Re.1 per minute from Rs.1.75 for all incoming calls; to Re.1 from Rs.1.40 for local outgoing; and to Rs.1.50 from Rs.2.40 for outgoing STD. The monthly rental of ‘Super One India Plan’ was reduced substantially to Rs.299 from Rs.799.
“We have chalked out a number of attractive schemes for both post-paid and pre-paid subscribers offering highly competitive rates. We are also offering other schemes to give more value to our subscribers,” said BSNL Chairman and Managing Director Kuldeep Goyal.
The expansion of mobile network was on track and more than 3 crore new connections would be added within a year, he said. The BSNL has over 7.2-crore subscribers, including 3.6-crore mobile customers.
Mr. Goyal announced that attractive schemes were also being announced to increase broadband subscribers from 20 lakh to one crore by 2010.
Effective from midnight on Tuesday, landline users would pay Rs.1.20 per minute as against Rs.2.40 for STD calls to all networks. Rural customers would pay 80 paise per minute for STD calls.
The charges for intra-circle calls to BSNL network were also reduced from Rs.1.20 per minute to 60 paise with an increased pulse rate of two minutes.For mobile phone customers, STD charges were cut to Rs.1.20 per minute for the same network and Rs.1.40 for other networks.
Roaming charges under the pre-paid and the post-paid services were also revised. The roaming charges for all incoming calls were reduced — to Re.1 per minute from Rs.1.75 for all incoming calls; to Re.1 from Rs.1.40 for local outgoing; and to Rs.1.50 from Rs.2.40 for outgoing STD. The monthly rental of ‘Super One India Plan’ was reduced substantially to Rs.299 from Rs.799.
“We have chalked out a number of attractive schemes for both post-paid and pre-paid subscribers offering highly competitive rates. We are also offering other schemes to give more value to our subscribers,” said BSNL Chairman and Managing Director Kuldeep Goyal.
The expansion of mobile network was on track and more than 3 crore new connections would be added within a year, he said. The BSNL has over 7.2-crore subscribers, including 3.6-crore mobile customers.
Mr. Goyal announced that attractive schemes were also being announced to increase broadband subscribers from 20 lakh to one crore by 2010.
Sunday, June 8, 2008
Tata Motors` truck business may foot the bill for Nano loss
Tata Motors may charge the losses on its small car Nano, the world's cheapest car at Rs 1 lakh, against the profit it earns from selling trucks, according to industry analysts.
Chairman Ratan Tata has pledged to sell Nano, touted as the common man's car, at Rs 1,00,000 even though the cost of making and selling the car is expected to be higher because of rising steel, battery and other input prices. Tata Motors has formed a team to evolve a plan to keep the costs closer to the sale price.
"The challenge for Tata Motors is not to sell the car at Rs 1 lakh but to produce the car substantially below the Rs 1 lakh barrier so as to be profitable. With the recent skyrocketing increase in prices of raw materials it is next to impossible to maintain that limit. The company will look to counterbalance the heavy initial loss on Nano by margin gain on the commercial vehicle segment. The production numbers (of the Nano) will be considerably lower in the initial quarters", said a Mumbai-based auto analyst from one of the leading brokerage firm.
The car, which may be sold starting October, is expected to turn to profit in four years, automobile analysts who declined to be identified said. The car will be built at Tata Motor's plant in Singur, West Bengal.
The company intends to produce about 250,000 units of Nano's per annum in Phase I of expansion with a gradual increase to 350,000 units per annum in Phase II.
Chairman Ratan Tata has pledged to sell Nano, touted as the common man's car, at Rs 1,00,000 even though the cost of making and selling the car is expected to be higher because of rising steel, battery and other input prices. Tata Motors has formed a team to evolve a plan to keep the costs closer to the sale price.
"The challenge for Tata Motors is not to sell the car at Rs 1 lakh but to produce the car substantially below the Rs 1 lakh barrier so as to be profitable. With the recent skyrocketing increase in prices of raw materials it is next to impossible to maintain that limit. The company will look to counterbalance the heavy initial loss on Nano by margin gain on the commercial vehicle segment. The production numbers (of the Nano) will be considerably lower in the initial quarters", said a Mumbai-based auto analyst from one of the leading brokerage firm.
The car, which may be sold starting October, is expected to turn to profit in four years, automobile analysts who declined to be identified said. The car will be built at Tata Motor's plant in Singur, West Bengal.
The company intends to produce about 250,000 units of Nano's per annum in Phase I of expansion with a gradual increase to 350,000 units per annum in Phase II.
Friday, June 6, 2008
Mahindra chases Tata dream with small engine
Mahindra & Mahindra (M&M), the country's biggest maker of utility vehicles (UV), is developing a small engine for a smaller version of its UVs and replicate the Tatas dream of a small car, a company official said.
The company is developing an engine with a capacity ranging between 650cc and 750cc, said Hemant Luthra, president, Mahindra Systech. He declined to give more details. The Rs 28,500-crore group, which is partnering France's Renault to sell Logan, aims to expand presence in all the segments of the market. The Tata group's plan to sell the world's lowest-priced car has spurred many companies, including M&M, to follow in its footsteps.
Mahindra Bolero, powered by 2.5 litre engine, is priced at Rs 5.28 lakh. The utility vehicle is among the largest selling vehicles in rural India. Mahindra Logan, a mid-sized sedan, is powered by 1.4 litre petrol engine which is imported from France.
The company is developing an engine with a capacity ranging between 650cc and 750cc, said Hemant Luthra, president, Mahindra Systech. He declined to give more details. The Rs 28,500-crore group, which is partnering France's Renault to sell Logan, aims to expand presence in all the segments of the market. The Tata group's plan to sell the world's lowest-priced car has spurred many companies, including M&M, to follow in its footsteps.
Mahindra Bolero, powered by 2.5 litre engine, is priced at Rs 5.28 lakh. The utility vehicle is among the largest selling vehicles in rural India. Mahindra Logan, a mid-sized sedan, is powered by 1.4 litre petrol engine which is imported from France.
Thursday, June 5, 2008
Tata plans water brand to take on Coke, Pepsi
Tata Tea, which sold its stake in US-based Glaceau in last year, plans to begin selling a low-priced bottled water in the country through its unit Mount Everest Mineral Water (MEMW) to take on global rivals such as Coca-Cola and PepsiCo in the Rs 1,500-crore packaged drinking water market.
"We want to do it quickly,'' Pradeep Poddar, managing director and CEO, Mount Everest, told Business Standard. "The market is still very young and we can evolve it further through marketing new offerings."
The company may sell its bottled water brand for masses at rates lower than those offered by competitors Bisleri, PepsiCo and Coca-Cola, he said. "The challenge for us is developing a right technology."
"We want to do it quickly,'' Pradeep Poddar, managing director and CEO, Mount Everest, told Business Standard. "The market is still very young and we can evolve it further through marketing new offerings."
The company may sell its bottled water brand for masses at rates lower than those offered by competitors Bisleri, PepsiCo and Coca-Cola, he said. "The challenge for us is developing a right technology."
Tuesday, June 3, 2008
DoT to allow AT&T, DLF in 3G spectrum auction
As many as 342 aspirants, including AT&T, DLF and Deutsche Telecom-MoserBaer who failed to get new telecom licences in the last round, may get to bid for spectrum for launching next generation (3G) mobile services.
Department of Telecom (DoT) is understood to have mooted the proposal to allow those who had applied for licenses between September 25, 2007 and October 1, 2007, to participate in the next generation 3G mobile telephony services.
According to sources, DoT fears that if foreign players, who do not even have a licence, were allowed to participate in the 3G process, existing applicants may go to court and delay the entire process.
"If a non-licence holder gets 3G spectrum (radio frequency) on the basis of auction, it will be given a licence. There are 342 applications pending for grant of licence on first come-first served basis. These applicants may also go to court and delay the process," an internal note said.
However, DoT has also said that International Competitive Bidding, as suggested by Finance Ministry, would increase the competition and thus bring larger revenues during spectrum allocation, but this may pose legal hurdles.
DoT and telecom regulator TRAI have been at loggerheads over the issue of allowing foreign players in the 3G telephony with TRAI opposing the move saying their (foreign players) entry will be expensive and may result in higher tariffs.
Department of Telecom (DoT) is understood to have mooted the proposal to allow those who had applied for licenses between September 25, 2007 and October 1, 2007, to participate in the next generation 3G mobile telephony services.
According to sources, DoT fears that if foreign players, who do not even have a licence, were allowed to participate in the 3G process, existing applicants may go to court and delay the entire process.
"If a non-licence holder gets 3G spectrum (radio frequency) on the basis of auction, it will be given a licence. There are 342 applications pending for grant of licence on first come-first served basis. These applicants may also go to court and delay the process," an internal note said.
However, DoT has also said that International Competitive Bidding, as suggested by Finance Ministry, would increase the competition and thus bring larger revenues during spectrum allocation, but this may pose legal hurdles.
DoT and telecom regulator TRAI have been at loggerheads over the issue of allowing foreign players in the 3G telephony with TRAI opposing the move saying their (foreign players) entry will be expensive and may result in higher tariffs.
Monday, June 2, 2008
Videocon invests Rs 12,000 cr in telecom
Videocon promoted Datacom will invite bids next week for rolling out 70 million GSM mobile lines across the country, envisaging an investment of over Rs 12,000 crore in the next four years.
"We shall be releasing Request for Proposal (RFP) from telecom vendors for 70 million GSM lines. Our plan is to start rolling out network by August this year," Ravi Sharma, Managing Director of Datacom, a company led by Group Chairman Venugopal Dhoot, told PTI.
Videocon, which has a majority stake in Datacom, had earlier announced Rs 6,000 crore investment in the telecom business and it has now been doubled to Rs 12,000 crore.
Besides huge investment in the domestic telecom sector, Datacom is also looking for a footprint in the global market through a mix of stake acquisition in existing telecom companies or through greenfield projects.
The company is talking to a host of players globally through its international arm Thompson, Sharma said, adding that talks are in the initial stage and fructification of the deal may take some time. Datacom was awarded licenses in 22 circles recently and the government has already started allocating spectrum (radio frequency) in some of the circles.
The company has been given start-up 4.4 MHz spectrum in states of Kerala, Tamil Nadu, Andhra Pradesh and Karnataka and may also get frequency in Orissa and Kolkata soon.
"We shall be releasing Request for Proposal (RFP) from telecom vendors for 70 million GSM lines. Our plan is to start rolling out network by August this year," Ravi Sharma, Managing Director of Datacom, a company led by Group Chairman Venugopal Dhoot, told PTI.
Videocon, which has a majority stake in Datacom, had earlier announced Rs 6,000 crore investment in the telecom business and it has now been doubled to Rs 12,000 crore.
Besides huge investment in the domestic telecom sector, Datacom is also looking for a footprint in the global market through a mix of stake acquisition in existing telecom companies or through greenfield projects.
The company is talking to a host of players globally through its international arm Thompson, Sharma said, adding that talks are in the initial stage and fructification of the deal may take some time. Datacom was awarded licenses in 22 circles recently and the government has already started allocating spectrum (radio frequency) in some of the circles.
The company has been given start-up 4.4 MHz spectrum in states of Kerala, Tamil Nadu, Andhra Pradesh and Karnataka and may also get frequency in Orissa and Kolkata soon.
Friday, May 30, 2008
Dell's 2/3 sales to come from non-US markets
In the next five years two-third of Dell's revenue will come from outside of the US market. "BRIC countries-- Brazil, Russia, India, and China--led the company's growth in the emerging countries with revenue up by 58 per cent. And on a year-on-year basis unit shipment grew by 73 per cent," said Steve Felice, vice-president APAC and Japan. In the APAC region revenue in India grew 52 per cent and in China by 31 per cent.
He also said that India and China will be the test ground for Dell when launching its low-cost computing products.
"Our low cost computing products will be first made available in India and China markets. Other than the price point we also plan to meet the functionality expectations that a user wants, which many other vendors have not been able to deliver," Felice.
Earlier this year, Dell launched its first low-cost laptop Dell 500 in India with a starting price of Rs 24,500. The company maintained that several more products will be launched in the second half of 2008.
Dell might launch independent Dell Stores in India to increase its reach and sales. Felice said, "We are testing standalone Dell stores and there is a possibility that we might set up such stores in India." The company recently announced its retail foray with tie-up with Tata Croma along with its direct marketing strategy.
To keep up with the growth in the APAC region, Dell will also see a corresponding increase in the headcounts in Asia. On the other hand, Dell as a part of its cost cutting measures have already reduced 7,000 employees from its US and Europe operations.
Dell has 30,000 employees throughout APAC. Of which 15,000 support the respective geography operations in APAC and Japan. The rest support functions across the globe. "Compared to last year we added just about 1,000 employees. This is a part of better management and helps controlling cost," added Felice.
He also said that India and China will be the test ground for Dell when launching its low-cost computing products.
"Our low cost computing products will be first made available in India and China markets. Other than the price point we also plan to meet the functionality expectations that a user wants, which many other vendors have not been able to deliver," Felice.
Earlier this year, Dell launched its first low-cost laptop Dell 500 in India with a starting price of Rs 24,500. The company maintained that several more products will be launched in the second half of 2008.
Dell might launch independent Dell Stores in India to increase its reach and sales. Felice said, "We are testing standalone Dell stores and there is a possibility that we might set up such stores in India." The company recently announced its retail foray with tie-up with Tata Croma along with its direct marketing strategy.
To keep up with the growth in the APAC region, Dell will also see a corresponding increase in the headcounts in Asia. On the other hand, Dell as a part of its cost cutting measures have already reduced 7,000 employees from its US and Europe operations.
Dell has 30,000 employees throughout APAC. Of which 15,000 support the respective geography operations in APAC and Japan. The rest support functions across the globe. "Compared to last year we added just about 1,000 employees. This is a part of better management and helps controlling cost," added Felice.
Wednesday, May 28, 2008
Indian airlines not to go for baggage charges
Unlike some US airlines, Indian carriers are not thinking of charging services like baggage handling to beef up their bottomlines, which is hit by a steep hike in fuel prices, but would prefer to keep the options open.
The issue came to the fore following a decision by American Airline to impose a $25-15 charge for baggage handling, as the US carriers buckled under steep hike in fuel prices.
Officials of most major Indian airlines told PTI that they were not contemplating imposing charges for such services for the time being.
When asked for his response to the move, Jet Airways Chairman Naresh Goyal had yesterday said in Berlin that "all airlines which want to stay in business will have to take such decisions".
However, even his airline has not taken any decision to follow the US carrier in this regard, Jet officials said, adding that the comment was made in a general context.
Air India Executive Director Jitendra Bhargava said: "We have not thought of anything on this issue. It is a view expressed by him (Goyal) following the decision of some US carriers."
The issue came to the fore following a decision by American Airline to impose a $25-15 charge for baggage handling, as the US carriers buckled under steep hike in fuel prices.
Officials of most major Indian airlines told PTI that they were not contemplating imposing charges for such services for the time being.
When asked for his response to the move, Jet Airways Chairman Naresh Goyal had yesterday said in Berlin that "all airlines which want to stay in business will have to take such decisions".
However, even his airline has not taken any decision to follow the US carrier in this regard, Jet officials said, adding that the comment was made in a general context.
Air India Executive Director Jitendra Bhargava said: "We have not thought of anything on this issue. It is a view expressed by him (Goyal) following the decision of some US carriers."
Wednesday, May 21, 2008
ArcelorMittal to have new leader for India
Global steel giant ArcelorMittal today announced a new leadership for India, where Vijay Bhatnagar will spearhead the company's operations and proposed steel projects in the country.
Bhatnagar will take up the new position of Country CEO, India and will have ultimate responsibility for the company's operations and projects in the country, a statement from ArcelorMittal said.
It added that Sanak Mishra will continue to be the CEO for the company's greenfield steel projects in Jharkhand and Orissa, and will report to Bhatnagar.
M P Singh, vice president for the company's mining initiatives globally, will continue to lead ArcelorMittal's mining projects in India as CEO Mining Projects (India).
The senior leadership team for India will operate in close supervision of Pierre Gugliermina, Christophe Cornier and Sudhir Maheshwari, besides rest of the general management board of ArcelorMittal.
Commenting on the new leadership for India, Aditya Mittal, member of the Group Management Board and Chief Financial Officer, ArcelorMittal, said, "India is a very important country for ArcelorMittal. We are committed to investing large sums in the country over the next decade and it is important that we have the right team to lead these positions".
Exuding confidence in the new team, Mittal said, "This team has excellent knowledge and leadership and I am sure will prove a strong combination for enabling us to deliver on our commitments to the country".
Steel behemoth ArcelorMittal has proposed setting up integrated steel plants of 12 million tonnes annual capacity each in Orissa and Jharkhand. The investment in each of the two projects would be approximately Rs 40,000 crore.
Bhatnagar will take up the new position of Country CEO, India and will have ultimate responsibility for the company's operations and projects in the country, a statement from ArcelorMittal said.
It added that Sanak Mishra will continue to be the CEO for the company's greenfield steel projects in Jharkhand and Orissa, and will report to Bhatnagar.
M P Singh, vice president for the company's mining initiatives globally, will continue to lead ArcelorMittal's mining projects in India as CEO Mining Projects (India).
The senior leadership team for India will operate in close supervision of Pierre Gugliermina, Christophe Cornier and Sudhir Maheshwari, besides rest of the general management board of ArcelorMittal.
Commenting on the new leadership for India, Aditya Mittal, member of the Group Management Board and Chief Financial Officer, ArcelorMittal, said, "India is a very important country for ArcelorMittal. We are committed to investing large sums in the country over the next decade and it is important that we have the right team to lead these positions".
Exuding confidence in the new team, Mittal said, "This team has excellent knowledge and leadership and I am sure will prove a strong combination for enabling us to deliver on our commitments to the country".
Steel behemoth ArcelorMittal has proposed setting up integrated steel plants of 12 million tonnes annual capacity each in Orissa and Jharkhand. The investment in each of the two projects would be approximately Rs 40,000 crore.
Tuesday, May 20, 2008
Mittal to resume talks with MTN
Bharti Group chief Sunil Mittal is likely to resume talks with MTN's top management in Johannesburg to carry forward negotiations left inconclusive in London for a possible merger of the two entities.
Mittal is expected in the South African capital shortly to hold parleys, industry sources said.
Meanwhile, Telecom Watchdog, an NGO, cautioned the MTN Chairman that a merger of the two companies would not be in compliance with regulations in India.
Telecom Watchdog Secretary Anil Kumar told PTI: "I have written a letter to MTN chairman Cyril Ramaphosa to take note of the fact that a 51 per cent acquisition by Bharti is okay but a full scale merger through share-swap will surely breach the FDI guidelines in India which is sure to be challenged legally.
"I have told him not to take any dubious route for merging with Bharti and circumvent the laws. It is okay if it is a 51 per cent acquisition."
Foreign Direct Investment in Bharti already touches 65 per cent and it can absorb a further nine per cent.
"In case of a merger we have apprehensions of a possible breach of Indian regulatory norms related to foreign investment... In case of any regulatory breach, we will not hesitate in going to the Indian courts for a legal recourse to stop any illegalities," Kumar said in his letter.
Russian operator Altimo's arm Vimpelcom and Deutsche Telekom are also believed to have expressed interest in MTN, a leading telecom player in Africa. When contacted, Deutsche Telekom said it does not comment on rumours and speculations, while queries to Altimo officials remained unanswered.
Earlier, UAE's incumbent operator Etisalat had also said it was examining the possibilities of joining the fray for MTN.
Mittal is expected in the South African capital shortly to hold parleys, industry sources said.
Meanwhile, Telecom Watchdog, an NGO, cautioned the MTN Chairman that a merger of the two companies would not be in compliance with regulations in India.
Telecom Watchdog Secretary Anil Kumar told PTI: "I have written a letter to MTN chairman Cyril Ramaphosa to take note of the fact that a 51 per cent acquisition by Bharti is okay but a full scale merger through share-swap will surely breach the FDI guidelines in India which is sure to be challenged legally.
"I have told him not to take any dubious route for merging with Bharti and circumvent the laws. It is okay if it is a 51 per cent acquisition."
Foreign Direct Investment in Bharti already touches 65 per cent and it can absorb a further nine per cent.
"In case of a merger we have apprehensions of a possible breach of Indian regulatory norms related to foreign investment... In case of any regulatory breach, we will not hesitate in going to the Indian courts for a legal recourse to stop any illegalities," Kumar said in his letter.
Russian operator Altimo's arm Vimpelcom and Deutsche Telekom are also believed to have expressed interest in MTN, a leading telecom player in Africa. When contacted, Deutsche Telekom said it does not comment on rumours and speculations, while queries to Altimo officials remained unanswered.
Earlier, UAE's incumbent operator Etisalat had also said it was examining the possibilities of joining the fray for MTN.
Monday, May 19, 2008
RPG plans to double its retail biz turnover
The RPG group has lined up an aggressive expansion plan for its retail business and aims to virtually double its turnover to Rs 1,800 crore this fiscal.
"Last year, we achieved a turnover of Rs 1,000 crore. Our aim is to grow our retail business aggressively and achieve a turnover of Rs 1,800 crore this year," RPG group Chairman Harsh Goenka told PTI here.
The group plans to pump in Rs 1,000 crore as investment into its retail business over the next three years to fuel its expansion.
"We will also be investing substantially in IT and business processes," Goenka said.
The group plans to scale up the store network of its flagship retail brand, Spencer's, from the present 400 to 600 this year.
The expansion will be funded through both internal accruals and debt, he said.
Goenka indicated that the company has virtually shelved its plans to go in for an initial public offering (IPO) this year.
"Last year, we achieved a turnover of Rs 1,000 crore. Our aim is to grow our retail business aggressively and achieve a turnover of Rs 1,800 crore this year," RPG group Chairman Harsh Goenka told PTI here.
The group plans to pump in Rs 1,000 crore as investment into its retail business over the next three years to fuel its expansion.
"We will also be investing substantially in IT and business processes," Goenka said.
The group plans to scale up the store network of its flagship retail brand, Spencer's, from the present 400 to 600 this year.
The expansion will be funded through both internal accruals and debt, he said.
Goenka indicated that the company has virtually shelved its plans to go in for an initial public offering (IPO) this year.
Friday, May 16, 2008
Tata launches Indica with dual fuel engine
Homegrown major Tata Motors today announced it has launched a new variant of its hatchback 'Indica', equipped with a dual fuel engine for petrol and LPG, priced Rs 3.27-Rs 3.42 lakh (ex-showroom, Delhi).
The new 'Indica V2 Xeta LPG' would come with a 1.2 litre MPFI (Multi Point Fuel Injection) engine with two ECUs (Electronic Control Units), the company said in a statement.
"The model is equipped with a dual fuel (petrol and LPG) engine, which reduces CO2 emissions by about 10 per cent, while delivering excellent fuel efficiency both in the city and on highways," Tata Motors said.
The engine of the car would meet Bharat Stage III emission norms and could be upgraded to Euro IV norms as well, it said.
"The Xeta LPG will initially be launched in two variants - GLE and GLS. The Xeta LPG GLE variant is priced at Rs 3.27 lakh (ex-showroom, Delhi), while the Xeta LPG GLS variant is priced at Rs 3.42 lakh (ex-showroom, Delhi)," the statement said.
The new 'Indica V2 Xeta LPG' would come with a 1.2 litre MPFI (Multi Point Fuel Injection) engine with two ECUs (Electronic Control Units), the company said in a statement.
"The model is equipped with a dual fuel (petrol and LPG) engine, which reduces CO2 emissions by about 10 per cent, while delivering excellent fuel efficiency both in the city and on highways," Tata Motors said.
The engine of the car would meet Bharat Stage III emission norms and could be upgraded to Euro IV norms as well, it said.
"The Xeta LPG will initially be launched in two variants - GLE and GLS. The Xeta LPG GLE variant is priced at Rs 3.27 lakh (ex-showroom, Delhi), while the Xeta LPG GLS variant is priced at Rs 3.42 lakh (ex-showroom, Delhi)," the statement said.
Tuesday, May 13, 2008
Nissan to roll out budget car by `10
Nissan, Japan's third largest car maker in which Renault holds 44 per cent stake, will churn out three models based on a single platform from its manufacturing base in Chennai by 2010.
The car will be sold in five countries categorised by the company as the leading competitive countries (LCC). The car, based on the A platform, will be produced in these countries that include India and Tailand.
All models will be capitalised on cost competitiveness, thanks to high levels of localisation through easy sourcing of components. The company is not present in the low-cost car category, and believes that there will be a lot of room for improvement.
While announcing the company's result for financial year 2007, Carlos Ghosn, chief executive officer, Nissan, said the company would also set up a technical centre in Chennai in partnership with Renault, where they are developing a 400,000-unit per year facility for passenger cars. Together, the Renault-Nissan alliance is the fifth largest automakers in the world.
Nissan is expecting sales of more than 200,000 units from India in 2012. The target will be achieved through its alliances with Bajaj, for a small car, Ashok Leyland for commercial vehicles, Renault for passenger cars and Hover for sales, marketing and dealer development support.
The car will be sold in five countries categorised by the company as the leading competitive countries (LCC). The car, based on the A platform, will be produced in these countries that include India and Tailand.
All models will be capitalised on cost competitiveness, thanks to high levels of localisation through easy sourcing of components. The company is not present in the low-cost car category, and believes that there will be a lot of room for improvement.
While announcing the company's result for financial year 2007, Carlos Ghosn, chief executive officer, Nissan, said the company would also set up a technical centre in Chennai in partnership with Renault, where they are developing a 400,000-unit per year facility for passenger cars. Together, the Renault-Nissan alliance is the fifth largest automakers in the world.
Nissan is expecting sales of more than 200,000 units from India in 2012. The target will be achieved through its alliances with Bajaj, for a small car, Ashok Leyland for commercial vehicles, Renault for passenger cars and Hover for sales, marketing and dealer development support.
GDP for FY08 may miss projections
The Indian economy is projected to have grown at a slower pace in 2007-08, as data released today showed industrial production growth during the year moderated considerably over the previous year.
The advance estimates for national income for 2007-08 had pegged the growth of gross domestic product (GDP) at 8.7 per cent. Economists now expect it to be a notch lower.
In addition, if industrial production growth continues to moderate in the current fiscal (2008-09), overall economic growth in the year is also expected to be lower than the Reserve Bank of India's GDP estimate of 8-8.5 per cent.
The Central Statistical Organisation (CSO) will release fourth quarter as well as full-year revised estimates of GDP growth for 2007-08 on May 30.
"GDP growth in 2007-08 will remain between 8 and 8.5 per cent," said N R Bhanumurthy, associate professor, Institute of Economic Growth, adding that forecasts for 2008-09 would also have to be revised downward. "I think GDP growth in the current fiscal will remain between 7 and 7.5 per cent."
However, Shashank Bhide of economic thinktank NCAER feels industrial growth may revive this fiscal. "I expect domestic demand to improve, which will offset the slowdown in the external sector. Forecasters will wait for the first quarter GDP data for 2008-09 before revising their own estimates," he said.
The dip in industrial production growth is being attributed to lower domestic as well as external demand. "A slowdown in the US economy and high domestic interest rates are the major reasons for the current state of industrial growth," Bhanumurthy added.
The most crucial element of the growth debate will be the impact of the industrial slowdown on the services sector, which accounts for around 55 per cent of GDP. "There is a very strong linkage between industry and services, as industrial growth creates demand for services," Bhanumurthy said.
"A poor performance by the industrial sector will adversely impact the growth rate of the services sector," Bhide added.
Industry was quick to demand that interest rates be lowered in order to revive the consumer goods sector. "The government should give a leg-up to industry by providing the right environment, including an interest rate revision. Performance of the manufacturing sector is expected to be lower even in the first quarter of 2008-09.
Some of the major concerns of industry are increase in the prices of raw material and high interest cost," said Amit Mitra, secretary-general, Federation of Indian Chambers of Commerce and Industry.
The downtrend had been reflected in the CII-ASCON survey released by the Confederation of Indian Industry (CII) last week. Today, the chamber said there was an urgent need to build infrastructure, create institutions and policy for advanced manufacturing and engineering, remove bottlenecks regarding power costs and labour laws. "Announcement of a national manufacturing policy will help manufacturing consolidate in long term," it added.
Assocham President Venugopal N Dhoot said the manufacturing sector had seen a substantial increase in input costs. "The government should encourage growth of the infrastructure sector as the industrial slowdown would have implications for the economic growth in the current financial year ," he said.
The advance estimates for national income for 2007-08 had pegged the growth of gross domestic product (GDP) at 8.7 per cent. Economists now expect it to be a notch lower.
In addition, if industrial production growth continues to moderate in the current fiscal (2008-09), overall economic growth in the year is also expected to be lower than the Reserve Bank of India's GDP estimate of 8-8.5 per cent.
The Central Statistical Organisation (CSO) will release fourth quarter as well as full-year revised estimates of GDP growth for 2007-08 on May 30.
"GDP growth in 2007-08 will remain between 8 and 8.5 per cent," said N R Bhanumurthy, associate professor, Institute of Economic Growth, adding that forecasts for 2008-09 would also have to be revised downward. "I think GDP growth in the current fiscal will remain between 7 and 7.5 per cent."
However, Shashank Bhide of economic thinktank NCAER feels industrial growth may revive this fiscal. "I expect domestic demand to improve, which will offset the slowdown in the external sector. Forecasters will wait for the first quarter GDP data for 2008-09 before revising their own estimates," he said.
The dip in industrial production growth is being attributed to lower domestic as well as external demand. "A slowdown in the US economy and high domestic interest rates are the major reasons for the current state of industrial growth," Bhanumurthy added.
The most crucial element of the growth debate will be the impact of the industrial slowdown on the services sector, which accounts for around 55 per cent of GDP. "There is a very strong linkage between industry and services, as industrial growth creates demand for services," Bhanumurthy said.
"A poor performance by the industrial sector will adversely impact the growth rate of the services sector," Bhide added.
Industry was quick to demand that interest rates be lowered in order to revive the consumer goods sector. "The government should give a leg-up to industry by providing the right environment, including an interest rate revision. Performance of the manufacturing sector is expected to be lower even in the first quarter of 2008-09.
Some of the major concerns of industry are increase in the prices of raw material and high interest cost," said Amit Mitra, secretary-general, Federation of Indian Chambers of Commerce and Industry.
The downtrend had been reflected in the CII-ASCON survey released by the Confederation of Indian Industry (CII) last week. Today, the chamber said there was an urgent need to build infrastructure, create institutions and policy for advanced manufacturing and engineering, remove bottlenecks regarding power costs and labour laws. "Announcement of a national manufacturing policy will help manufacturing consolidate in long term," it added.
Assocham President Venugopal N Dhoot said the manufacturing sector had seen a substantial increase in input costs. "The government should encourage growth of the infrastructure sector as the industrial slowdown would have implications for the economic growth in the current financial year ," he said.
Sunday, May 11, 2008
ICICI Bank lowers EMIs for home loan customers
Lengthens tenures in response to customer feedback.
ICICI Bank, India's second biggest bank, has offered to lower the equated monthly installments (EMIs) for a large number of its borrowers by enhancing the tenure of their home loans.
A letter to borrowers explained that the move was being made as a "customer-friendly gesture".
The bank had raised the benchmark reference rate or the prime lending rate for floating rate borrowers in February and March 2007, following which many borrowers were asked to pay higher EMIs.
"Subsequently, we have received a lot of feedback from customers that they would prefer to increase the tenure rather than increasing the EMI," the letter said.
The offer was open from April.
ICICI Bank, India's second biggest bank, has offered to lower the equated monthly installments (EMIs) for a large number of its borrowers by enhancing the tenure of their home loans.
A letter to borrowers explained that the move was being made as a "customer-friendly gesture".
The bank had raised the benchmark reference rate or the prime lending rate for floating rate borrowers in February and March 2007, following which many borrowers were asked to pay higher EMIs.
"Subsequently, we have received a lot of feedback from customers that they would prefer to increase the tenure rather than increasing the EMI," the letter said.
The offer was open from April.
3 govt banks to part-fund Tata Motors` JLR buy
Leading Indian public sector banks State Bank of India (SBI), Bank of Baroda (BoB) and Syndicate Bank are close to committing a part of the $3 billion bridge loan that Tata Motors has to raise to finance the acquisition of Jaguar and Land Rover from Ford.
India's largest automobile maker signed a deal to buy luxury brands Jaguar and Land Rover for $2.3 billion in cash on March 26, the largest acquisition by an Indian company in the automobile business.
According to banking sources, banks like BoB with a large international business are expected to commit between $50 million and $100 million, while banks with a limited presence like Syndicate Bank could take exposure between $10 million and $30 million.
The other banks in the reckoning include State Bank of Mauritius, ING Bank, JP Morgan, and Citibank.
The deal is expected to be closed in a week or two.
A Tata Motors spokesperson declined to comment on the issue.
Banking sources said the average interest rate works out to 135 basis points above the London Interbank Offered Rate (Libor). The tenure of the loan is about 15 months, after which the company is expected to tie up long-term funds. The company had announced that it was looking at a combination of equity funding and term loans.
The Jaguar-Land Rover deal will extend Tata Motors' product portfolio span from a price point of $2,500 to $170,000 and expand its distribution network more than four times to 2,700 outlets in 138 countries.
The Tatas will also have to resuscitate demand after Jaguar sales in the US and Europe dropped 33 per cent in 2007. Ford doesn't disclose financial figures for Jaguar and Land Rover, whose biggest markets are the UK and the US.
India's largest automobile maker signed a deal to buy luxury brands Jaguar and Land Rover for $2.3 billion in cash on March 26, the largest acquisition by an Indian company in the automobile business.
According to banking sources, banks like BoB with a large international business are expected to commit between $50 million and $100 million, while banks with a limited presence like Syndicate Bank could take exposure between $10 million and $30 million.
The other banks in the reckoning include State Bank of Mauritius, ING Bank, JP Morgan, and Citibank.
The deal is expected to be closed in a week or two.
A Tata Motors spokesperson declined to comment on the issue.
Banking sources said the average interest rate works out to 135 basis points above the London Interbank Offered Rate (Libor). The tenure of the loan is about 15 months, after which the company is expected to tie up long-term funds. The company had announced that it was looking at a combination of equity funding and term loans.
The Jaguar-Land Rover deal will extend Tata Motors' product portfolio span from a price point of $2,500 to $170,000 and expand its distribution network more than four times to 2,700 outlets in 138 countries.
The Tatas will also have to resuscitate demand after Jaguar sales in the US and Europe dropped 33 per cent in 2007. Ford doesn't disclose financial figures for Jaguar and Land Rover, whose biggest markets are the UK and the US.
Reliance to use closed fuel outlets for malls and multiplexes
Reliance Industries Ltd (RIL), India's biggest firm by market capitalisation, is drawing up plans to convert its fuel retail outlets, which were recently closed owing to unviable operations, into malls and multiplexes.
Earmarking about Rs 5,000 crore for the project, the company is planning to develop 700 to 800 properties at important locations. The company, which is promoted by Mukesh Ambani, has also approached its fuel dealers with offers to buy out the properties they own, said sources familiar with the developments.
"About 500 properties used for the fuel retail business are owned by the Mukesh Ambani group. The remaining outlets are dealer-owned and dealer-operated. The dealers, who were incurring losses due to suspension of the retail business, have approached the company to sell their properties," company sources said.
Earmarking about Rs 5,000 crore for the project, the company is planning to develop 700 to 800 properties at important locations. The company, which is promoted by Mukesh Ambani, has also approached its fuel dealers with offers to buy out the properties they own, said sources familiar with the developments.
"About 500 properties used for the fuel retail business are owned by the Mukesh Ambani group. The remaining outlets are dealer-owned and dealer-operated. The dealers, who were incurring losses due to suspension of the retail business, have approached the company to sell their properties," company sources said.
Saturday, May 10, 2008
Skoda starts work on small-car platform
Czech automaker Skoda is working to develop an all-new platform for its proposed small car project, distinct from the existing platform of parent Volkswagen, a top company official said.
To be made in India, the car is expected to make its debut within two years and will be sold globally, Skoda India Director Thomas Kuehl said. Skoda’s smallest offering is the premium hatchback Fabia, which was launched in India in January. “Our small car will be launched first in India. The car will cater to virgin markets and will be priced in the Rs 3-5 lakh bracket,” he said. Simultaneously, Skoda will focus on expanding its product portfolio and has eight models lined up for launch in the country within five years.
Friday, May 9, 2008
Dish DTH to offer free set-top boxes
Move aimed at impending entry of Reliance, Bharti services.
The price-war has begun in the direct-to-home (DTH) market with the country's largest DTH company Dish TV — with over 3 million subscribers —getting ready to offer its connection virtually free.
Any consumer who wants to buy a Dish TV connection will not have to pay for the set-top box, the hardware essential to access DTH services and normally costs Rs 2,500.
This move is in anticipation of the launch of services from Reliance Communications' Big TV and Bharti's DTH services and also to take on its competitor Tata Sky, which has now crossed the 2 million subscriber mark.
This step is also expected to add to the monthly losses of Dish TV, currently estimated to be over Rs 450 crore.
According to sources, Dish TV is set to undertake a massive branding exercise centred on a "free Dish TV connection" featuring its brand ambassador Shah Rukh Khan at an estimated budget in excess of Rs 50 crore.
DISHING IT OUT
Company
Cost of
STB
Monthly
subscription
Dish TV
Free*
Rs 300
+taxes
Tata Sky
Rs 1,500
+installation
Rs 300
+taxes
Big TV
(soft launch only)
Rs 1,000
+installation
Rs 200
+taxes
* expected to announce shortly
The price-war has begun in the direct-to-home (DTH) market with the country's largest DTH company Dish TV — with over 3 million subscribers —getting ready to offer its connection virtually free.
Any consumer who wants to buy a Dish TV connection will not have to pay for the set-top box, the hardware essential to access DTH services and normally costs Rs 2,500.
This move is in anticipation of the launch of services from Reliance Communications' Big TV and Bharti's DTH services and also to take on its competitor Tata Sky, which has now crossed the 2 million subscriber mark.
This step is also expected to add to the monthly losses of Dish TV, currently estimated to be over Rs 450 crore.
According to sources, Dish TV is set to undertake a massive branding exercise centred on a "free Dish TV connection" featuring its brand ambassador Shah Rukh Khan at an estimated budget in excess of Rs 50 crore.
DISHING IT OUT
Company
Cost of
STB
Monthly
subscription
Dish TV
Free*
Rs 300
+taxes
Tata Sky
Rs 1,500
+installation
Rs 300
+taxes
Big TV
(soft launch only)
Rs 1,000
+installation
Rs 200
+taxes
* expected to announce shortly
Tuesday, May 6, 2008
Reliance shuts all of its 1,432 petrol pumps
Reliance Industries has shut all of its 1,432 petrol pumps in the country after sales dropped to almost nil as it could not match the subsidised price offered by public sector competition.
The company owned less than three per cent of the 36,936 petrol pumps in the country. Of the total retail outlets, state run Indian Oil, Bharat Petroleum and Hindustan Petroleum own 34,304 pumps, while the remaining belong to private sector Essar Oil and Shell India.
"Reliance has informed that sales at their retail outlets was negligible due to selling price differential between private and public sector ROs, leading to the closure of all their 1,432 pumps in the country with effect from March 15," Petroleum Minister Murli Deora informed the Rajya Sabha today.
Public sector currently sell petrol at a loss of Rs 13.97 a litre and diesel at a discount of Rs 20.97 per litre. This revenue loss is made up by the Government through issue of oil bonds and subsidy share from upstream firms like ONGC and GAIL.
Private firms such as Reliance were not entitled for the subsidy and priced fuel from their pumps at Rs 8-10 a litre higher than public sector competition, leading to fall in market share.
"The price of sensitive petroleum products are fixed by the public sector oil marketing companies in consultation with the Government," Deora said. "Private oil companies are not subject to pricing restrictions by the Government and are free to take their pricing decisions on commercial considerations."
However, Essar Oil and Shell India have not closed their petrol pumps, he said.
The company owned less than three per cent of the 36,936 petrol pumps in the country. Of the total retail outlets, state run Indian Oil, Bharat Petroleum and Hindustan Petroleum own 34,304 pumps, while the remaining belong to private sector Essar Oil and Shell India.
"Reliance has informed that sales at their retail outlets was negligible due to selling price differential between private and public sector ROs, leading to the closure of all their 1,432 pumps in the country with effect from March 15," Petroleum Minister Murli Deora informed the Rajya Sabha today.
Public sector currently sell petrol at a loss of Rs 13.97 a litre and diesel at a discount of Rs 20.97 per litre. This revenue loss is made up by the Government through issue of oil bonds and subsidy share from upstream firms like ONGC and GAIL.
Private firms such as Reliance were not entitled for the subsidy and priced fuel from their pumps at Rs 8-10 a litre higher than public sector competition, leading to fall in market share.
"The price of sensitive petroleum products are fixed by the public sector oil marketing companies in consultation with the Government," Deora said. "Private oil companies are not subject to pricing restrictions by the Government and are free to take their pricing decisions on commercial considerations."
However, Essar Oil and Shell India have not closed their petrol pumps, he said.
India tops foreign bank borrowings in Asia
BIS data show nation borrowed $28 bn in fourth quarter of '07 .
Foreign banks have sharply increased their exposure to banks and financial companies in India by providing loans to the tune of $28 billion during the last quarter of 2007, according to the latest banking statistics of the Bank for International Settlements (BIS) last week.
"The rise in lending by banks in Europe and the United States to their counterparts in India reflects the degree of confidence in the Indian economy at a time when the global credit crisis had sharply deteriorated," banking analysts said.
"In Asia, India borrowed $28 billion, followed by China ($25 billion) and Korea ($17 billion)," said BIS, which is reckoned as the global watchdog for central banks the world over.
Worldwide consolidated foreign claims on India, which imply cross-border as well as local claims made on local residents by foreign offices of domestic banks, have gone up from $168,087 million to $195,939 million during the end of the third and fourth quarters of the last year.
"BIS figures suggest international banks do not harbour fears about the strength and resilience of Indian banks," said a Geneva-based banking analyst, arguing that "India is not facing the same travails as banks in the US and Europe, following the credit crunch, which cropped up because of the sub-prime mortgage meltdown."
A detailed break-up of the claims made by foreign banks on Indian banks and financial companies reveals that 16 countries have stepped up their exposure during the end of Q3 2007 and Q4 2007.
Foreign banks have sharply increased their exposure to banks and financial companies in India by providing loans to the tune of $28 billion during the last quarter of 2007, according to the latest banking statistics of the Bank for International Settlements (BIS) last week.
"The rise in lending by banks in Europe and the United States to their counterparts in India reflects the degree of confidence in the Indian economy at a time when the global credit crisis had sharply deteriorated," banking analysts said.
"In Asia, India borrowed $28 billion, followed by China ($25 billion) and Korea ($17 billion)," said BIS, which is reckoned as the global watchdog for central banks the world over.
Worldwide consolidated foreign claims on India, which imply cross-border as well as local claims made on local residents by foreign offices of domestic banks, have gone up from $168,087 million to $195,939 million during the end of the third and fourth quarters of the last year.
"BIS figures suggest international banks do not harbour fears about the strength and resilience of Indian banks," said a Geneva-based banking analyst, arguing that "India is not facing the same travails as banks in the US and Europe, following the credit crunch, which cropped up because of the sub-prime mortgage meltdown."
A detailed break-up of the claims made by foreign banks on Indian banks and financial companies reveals that 16 countries have stepped up their exposure during the end of Q3 2007 and Q4 2007.
Smaller cities fetching more jobs: Assocham
High manpower cost and capacity constraints in metros is prompting the corporates towards small cities for job creation, according to Trends of Job Openings, a study conducted by business chamber Assocham. The study, which surveyed 60 cities, revealed that tier II and tier III cities have cornered 28 per cent and 38 per cent share of the job respectively during first three months of this calendar year.
The study was based on a sample of 32,000 vacancies posted by around 3,500 companies in the national and regional dailies, journals and job portals during the three months between January-March 2008. It showed that metropolitans continue to remain as the maximum employment-generating cities for the job seekers.
Among the tier II cities, Pune emerged as the preferred employment provider with 16.50 per cent share, followed by Lucknow and Pondicherry. The top three employment providing tier III cities were Ranchi (13.80 per cent), Mangalore (11.60 per cent) and Mysore (11.08 per cent).
Mumbai topped the chart with 18.52 per cent share as the most prominent employment destination. It was followed by NCR (15.41 per cent), Delhi (11.55 per cent) and Bangalore (10.00 per cent) respectively.
Pune ranked fifth among the top ten employment providing cities in India, above the metro cities of Chennai (sixth rank) and Hyderabad (seventh rank). Kolkata was at the ninth rank, behind Lucknow a tier II city.
The study was based on a sample of 32,000 vacancies posted by around 3,500 companies in the national and regional dailies, journals and job portals during the three months between January-March 2008. It showed that metropolitans continue to remain as the maximum employment-generating cities for the job seekers.
Among the tier II cities, Pune emerged as the preferred employment provider with 16.50 per cent share, followed by Lucknow and Pondicherry. The top three employment providing tier III cities were Ranchi (13.80 per cent), Mangalore (11.60 per cent) and Mysore (11.08 per cent).
Mumbai topped the chart with 18.52 per cent share as the most prominent employment destination. It was followed by NCR (15.41 per cent), Delhi (11.55 per cent) and Bangalore (10.00 per cent) respectively.
Pune ranked fifth among the top ten employment providing cities in India, above the metro cities of Chennai (sixth rank) and Hyderabad (seventh rank). Kolkata was at the ninth rank, behind Lucknow a tier II city.
Monday, May 5, 2008
GE India to manufacture windmills in India
New York Stock Exchange-listed General Electric Company is planning to manufacture windmills and gas turbines in India.
"The company is planning big in three areas infrastructure, energy and aviation, but our main focus is to manufacture windmills and turbines," GE India President and CEO Tejpreet S Chopra told PTI
GE which installed first hydro power plant in 1902 presently has a headcount of 14,500 in India."GE is planning to manufacture windmills and gas turbines in India," he said but declined to give details.
General Electric exports over USD 1 billion in products and services, GE India revenues stand at USD 2.8 billion.
General Electric Aviation, a unit of General Electric Co, received a USD 321.7 million contract to supply engines and device kits and related equipment for the American Navy's fighter jets recently.
"The company is planning big in three areas infrastructure, energy and aviation, but our main focus is to manufacture windmills and turbines," GE India President and CEO Tejpreet S Chopra told PTI
GE which installed first hydro power plant in 1902 presently has a headcount of 14,500 in India."GE is planning to manufacture windmills and gas turbines in India," he said but declined to give details.
General Electric exports over USD 1 billion in products and services, GE India revenues stand at USD 2.8 billion.
General Electric Aviation, a unit of General Electric Co, received a USD 321.7 million contract to supply engines and device kits and related equipment for the American Navy's fighter jets recently.
Sunday, May 4, 2008
Bollywood to remake Hollywood film
Good news for movie buffs tired of watching "unofficial" Hollywood remakes or `inspired' movies.
Mukesh Talreja and Nikhil Advani of Orion Pictures are in talks with Warner Brothers to remake Hollywood blockbuster "Wedding Crashers".
The company is in talks with two big actors to play the lead in this remake.
"I have seen `Wedding Crashers' and think it is a great property that would certainly lend itself to a Bollywood remake and I am very happy that we will be doing this in the right way in association with Warner Brothers," Talreja said.
Blaise Fernandes, Warner Brothers India, said "we are talking to Orion Pictures on the possibilities of remaking `Wedding Crashers'. Orion has shown keen interest in this project and they have lined up some of the best talent for this project".
Warner Brothers will also take legal action against any party who plans to remake this film in concept or as a remake, according to sources.
Warner Brothers is also presenting Orion Pictures' Akshay Kumar-starrer "Chandni Chowk to China" in association with Ramesh Sippy Entertainment.
Mukesh Talreja and Nikhil Advani of Orion Pictures are in talks with Warner Brothers to remake Hollywood blockbuster "Wedding Crashers".
The company is in talks with two big actors to play the lead in this remake.
"I have seen `Wedding Crashers' and think it is a great property that would certainly lend itself to a Bollywood remake and I am very happy that we will be doing this in the right way in association with Warner Brothers," Talreja said.
Blaise Fernandes, Warner Brothers India, said "we are talking to Orion Pictures on the possibilities of remaking `Wedding Crashers'. Orion has shown keen interest in this project and they have lined up some of the best talent for this project".
Warner Brothers will also take legal action against any party who plans to remake this film in concept or as a remake, according to sources.
Warner Brothers is also presenting Orion Pictures' Akshay Kumar-starrer "Chandni Chowk to China" in association with Ramesh Sippy Entertainment.
Wednesday, April 30, 2008
Ashok Leyland in Rs 3,000cr expansion plan
Hinduja flagship company Ashok Leyland today said it will invest Rs 3,000 crore on its new plant, coming up in Uttarakhand and on capacity expansion of its existing unit at Ennore.
A part of the planned investment will also be on engine development. The company is developing six cylinder and four cylinder engines with Austrian firm AVL complying with the Euro IV norms.
"The company will be investing Rs 3,000 crore on the new vehicle plant coming up in Uttarakhand, which will be capable of rolling out 50,000 vehicles and expansion of manufacturing facility at Ennore and the new engine development project," Ashok Leyland Chief Financial Officer K Sridharan told reporters on the sidelines of CFO Asia Summit here.
He said Rs 1,000-1,500 crore would be raised through internal accruals, while close to Rs 800 crore would be raised from outside, possibly from overseas market.
The company had also raised $200 million through external commercial borrowings of which $20 million have already been drawn while remaining amount is yet to be drawn from the market, he added.
A part of the planned investment will also be on engine development. The company is developing six cylinder and four cylinder engines with Austrian firm AVL complying with the Euro IV norms.
"The company will be investing Rs 3,000 crore on the new vehicle plant coming up in Uttarakhand, which will be capable of rolling out 50,000 vehicles and expansion of manufacturing facility at Ennore and the new engine development project," Ashok Leyland Chief Financial Officer K Sridharan told reporters on the sidelines of CFO Asia Summit here.
He said Rs 1,000-1,500 crore would be raised through internal accruals, while close to Rs 800 crore would be raised from outside, possibly from overseas market.
The company had also raised $200 million through external commercial borrowings of which $20 million have already been drawn while remaining amount is yet to be drawn from the market, he added.
Reliance Communications FY08 net up 70%
Reliance Communications today reported 70.5% surge in consolidated net profit at Rs 5,401.14 crore for the financial year ended March 31, 2008, as against Rs 3,167.59 crore posted in FY07.
According to a release issued by Reliance Communications to the BSE today, the company's FY08 total income increased 31.8% to Rs 19,067.76 crore from Rs 14,468.29 crore in FY07.
According to a release issued by Reliance Communications to the BSE today, the company's FY08 total income increased 31.8% to Rs 19,067.76 crore from Rs 14,468.29 crore in FY07.
RCom,Tata to pay Rs 700 cr to BSNL: SC
RCom,Tata to pay Rs 700 cr to BSNL: SC
Press Trust of India / New Delhi April 30, 2008
The Supreme Court has held Tata Teleservices 'Walky' and Reliance Communication's (formerly Infocom) 'Unlimited Cordless' as limited mobile phones, hence they are liable to pay Access Deficit Charge (ADC) to BSNL for interconnection.
A bench headed by Justice H S Kapadia, while dismissing Tata Teleservices and Reliance Communication's petitions, has upheld telecom tribunal Telecom Dispute Settlement and Appellate Tribunal's (TDSAT) order of September 2005 that held these services are not fixed lines telephones, but limited mobile.
The Supreme Court had earlier reserved its judgement on a petition filed by Tata Teleservices challenging the telecom tribunal's order which classified the company's fixed wireless phone service 'Walky' as limited mobile.
Press Trust of India / New Delhi April 30, 2008
The Supreme Court has held Tata Teleservices 'Walky' and Reliance Communication's (formerly Infocom) 'Unlimited Cordless' as limited mobile phones, hence they are liable to pay Access Deficit Charge (ADC) to BSNL for interconnection.
A bench headed by Justice H S Kapadia, while dismissing Tata Teleservices and Reliance Communication's petitions, has upheld telecom tribunal Telecom Dispute Settlement and Appellate Tribunal's (TDSAT) order of September 2005 that held these services are not fixed lines telephones, but limited mobile.
The Supreme Court had earlier reserved its judgement on a petition filed by Tata Teleservices challenging the telecom tribunal's order which classified the company's fixed wireless phone service 'Walky' as limited mobile.
Monday, April 28, 2008
Tata group to examine investing more in State
A third Tidel Park will come up here in the next two years. The Rs.3,000-crore Information Technology park that will come up on an area of 25.27 acres opposite the present Tidel Park will be a joint venture between Tata Realty, the Tamil Nadu Industrial Development Corporation (TIDCO) and Indian Hotels Company Limited.
A Memorandum of Understanding to set up the park and associated facilities was signed here on Monday between two Tata group companies and TIDCO, in the presence of Chief Minister M. Karunanidhi.
At the meeting organised at the Secretariat to sign the MoU, Tata Realty and Infrastructure president R.K. Krishnakumar assured the Chief Minister that the Tatas would deploy a dedicated group of senior professionals to examine the possibility of making further investments in the State in the manufacturing sector. The group would hold discussions with the Industries Department, SIPCOT and TIDCO to discuss the options, he told Mr. Karunanidhi, in response to a query from him.
Assuming the role of one seeking to sell the concept of Tamil Nadu as an investment destination — a role he has donned from the time he took over as Chief Minister in May 2006 — the Chief Minister asked Mr. Krishnakumar: “Why don’t you consider setting up a car manufacturing unit here?” He added: “The Chennai Port is the best port to export cars. You should look at Tamil Nadu.”
The Chief Minister told him that most major car manufacturers had established assembly lines in the State and that the Tatas should consider doing the same.
Mr. Krishnakumar said the Tata Group would consider the suggestion, and immediately told Mr. Karunanidhi that he would set up a group of top professionals from the group to explore opportunities in Tamil Nadu for Tata Motors and other concerns of the group.
Mr. Krishnakumar exchanged the MoU documents with S. Ramasundaram, chairman and managing director, TIDCO. The entity is expected to achieve financial closure by May 27. “Land cost forms the bulk of the investment. Once the land cost is paid we will transfer the title to them,” Mr. Ramasundaram told The Hindu. After the transfer, the process of notification from the board of approval would be sought. This was necessary to get tax exemption for civil works.
The notification was expected around June-end. The firm would work on design and CMDA approvals from then on, and the first phase of the 2.1 million sq ft of IT space was expected to be ready by end-2009.
The remaining 1.5 million sq ft would be ready by early 2011, Mr. Krishnakumar told the Chief Minister. “Make that 2010,” the Chief Minister requested him. Mr. Krishnakumar said this should be possible. When completed, the facility would house firms that employ over 55,000 professionals and support staff.
A Memorandum of Understanding to set up the park and associated facilities was signed here on Monday between two Tata group companies and TIDCO, in the presence of Chief Minister M. Karunanidhi.
At the meeting organised at the Secretariat to sign the MoU, Tata Realty and Infrastructure president R.K. Krishnakumar assured the Chief Minister that the Tatas would deploy a dedicated group of senior professionals to examine the possibility of making further investments in the State in the manufacturing sector. The group would hold discussions with the Industries Department, SIPCOT and TIDCO to discuss the options, he told Mr. Karunanidhi, in response to a query from him.
Assuming the role of one seeking to sell the concept of Tamil Nadu as an investment destination — a role he has donned from the time he took over as Chief Minister in May 2006 — the Chief Minister asked Mr. Krishnakumar: “Why don’t you consider setting up a car manufacturing unit here?” He added: “The Chennai Port is the best port to export cars. You should look at Tamil Nadu.”
The Chief Minister told him that most major car manufacturers had established assembly lines in the State and that the Tatas should consider doing the same.
Mr. Krishnakumar said the Tata Group would consider the suggestion, and immediately told Mr. Karunanidhi that he would set up a group of top professionals from the group to explore opportunities in Tamil Nadu for Tata Motors and other concerns of the group.
Mr. Krishnakumar exchanged the MoU documents with S. Ramasundaram, chairman and managing director, TIDCO. The entity is expected to achieve financial closure by May 27. “Land cost forms the bulk of the investment. Once the land cost is paid we will transfer the title to them,” Mr. Ramasundaram told The Hindu. After the transfer, the process of notification from the board of approval would be sought. This was necessary to get tax exemption for civil works.
The notification was expected around June-end. The firm would work on design and CMDA approvals from then on, and the first phase of the 2.1 million sq ft of IT space was expected to be ready by end-2009.
The remaining 1.5 million sq ft would be ready by early 2011, Mr. Krishnakumar told the Chief Minister. “Make that 2010,” the Chief Minister requested him. Mr. Krishnakumar said this should be possible. When completed, the facility would house firms that employ over 55,000 professionals and support staff.
Airtel slashes STD, roaming tariffs
Triggering off a new round of price war in the roaming and STD segments for mobile telephony, leading mobile operator Bharti Airtel on Monday slashed STD and roaming tariffs by 43 per cent benefiting its 62 million customers.
Taking an aggressive posture to tap this huge potential segment, the company announced a reduction in STD rates by 43.39 per cent to Rs. 1.50 a minute from the earlier Rs. 2.65 a minute.
The new tariffs would be effective from April 30 and would be available for both pre- and post-paid users.
According to the announcement made by the company President and CEO, Manoj Kohli, and President, Mobile Services, Sanjay Kapoor, roaming charges for incoming calls would be cut to Re. 1 a minute from Rs. 1.75 a minute, a reduction of 42.85 per cent. Now, Airtel customers, while on roaming would be able to make local calls at Re. 1 a minute and an STD call at Rs. 1.50 a minute.
The move is expected to trigger a similar trend among all cellular operators like Vodafone Essar, Reliance Communications and Tata Teleservices to get a bigger chunk of the market share.
Taking an aggressive posture to tap this huge potential segment, the company announced a reduction in STD rates by 43.39 per cent to Rs. 1.50 a minute from the earlier Rs. 2.65 a minute.
The new tariffs would be effective from April 30 and would be available for both pre- and post-paid users.
According to the announcement made by the company President and CEO, Manoj Kohli, and President, Mobile Services, Sanjay Kapoor, roaming charges for incoming calls would be cut to Re. 1 a minute from Rs. 1.75 a minute, a reduction of 42.85 per cent. Now, Airtel customers, while on roaming would be able to make local calls at Re. 1 a minute and an STD call at Rs. 1.50 a minute.
The move is expected to trigger a similar trend among all cellular operators like Vodafone Essar, Reliance Communications and Tata Teleservices to get a bigger chunk of the market share.
FMCG prices up on higher input costs
The rise in raw material costs has caused a 10 per cent increase in the retail prices of fast-moving consumer goods as companies are passing on the rise in costs.
In the last few weeks, the price of the 100 gram bar of Godrej No 1 has gone up by Rs 2.5 to Rs 13, Wipro's Santoor by Rs 2 to Rs 16, Reckitt Benckiser's Dettol by Rs 2 to Rs 17 and Hindustan Unilever's Pears by Rs 2 to Rs 23. Even mass market brand Lifebuoy, the largest selling, has become costlier by Re 1 to retail for Rs 12.
Food items, too, have become costlier. "We had increased milk prices in February 2007, August 2007 and then again in February 2008 � each time by Re 1. We also raised the prices of select items such as ice-creams by 1-2 per cent in February," said R Sodhi, chief general manager, Gujarat Cooperative Milk Marketing Federation, which markets the ubiquitous Amul.
Procter & Gamble's Ariel detergent now costs Rs 122 for a 1 kg pack, a rise of Rs 6, while HUL's Surf Excel's price is up at Rs 126, costlier by Rs 10. In some cases, the prices have remained unchanged but packs have become lighter. The 1 kg pack of HUL's Wheel washing powder has shrunk to 800 gm.
However, HUL has bucked the trend in the case of Lux, its flagship soap brand, deciding to roll back the 5 per cent price increase it had effected earlier.
In the last few weeks, the price of the 100 gram bar of Godrej No 1 has gone up by Rs 2.5 to Rs 13, Wipro's Santoor by Rs 2 to Rs 16, Reckitt Benckiser's Dettol by Rs 2 to Rs 17 and Hindustan Unilever's Pears by Rs 2 to Rs 23. Even mass market brand Lifebuoy, the largest selling, has become costlier by Re 1 to retail for Rs 12.
Food items, too, have become costlier. "We had increased milk prices in February 2007, August 2007 and then again in February 2008 � each time by Re 1. We also raised the prices of select items such as ice-creams by 1-2 per cent in February," said R Sodhi, chief general manager, Gujarat Cooperative Milk Marketing Federation, which markets the ubiquitous Amul.
Procter & Gamble's Ariel detergent now costs Rs 122 for a 1 kg pack, a rise of Rs 6, while HUL's Surf Excel's price is up at Rs 126, costlier by Rs 10. In some cases, the prices have remained unchanged but packs have become lighter. The 1 kg pack of HUL's Wheel washing powder has shrunk to 800 gm.
However, HUL has bucked the trend in the case of Lux, its flagship soap brand, deciding to roll back the 5 per cent price increase it had effected earlier.
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