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Wednesday,
August 7, 2002, Chandigarh, India  
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Oil PSUs to benefit from govt decision
HC rejects VSNL selloff petition
VSNL may lose 441cr
Infosys revenue may touch Rs 3,244 cr |
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Govt clears 610cr FDI proposals
IndusInd Bank starts Internet banking
Tata Steel plant for S.Africa GRAPHIC: MAJOR PULSES PRODUCING STATES
DCM Financial harasses investors
HSBC posts fall
in profit
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Oil PSUs to benefit from govt decision New Delhi, August 6 The Parliamentary Standing Committee on Petroleum in its report to Parliament had recommended that upon dismantling of the administered pricing mechanism for the oil sector from April 1, 2002, the oil companies should be given functional freedom to choose their retailers and distributors. Though there were two representatives of oil companies, headed by a retired judge, in the now scraped dealer selection board, the oil companies had little say in the selection of retailers and distributors. The Parliamentary Committee, while reacting to the government stand that the dealer selection boards also served a social objective by giving gainful employment to unemployed people, said the objectives could be served only when the companies operate efficiently and earn profit. The committee said at a time when the private players were bound to operate on purely commercial considerations, there was no point in endangering the oil PSUs by tying them down to social objectives. Open market dealer should be selected based on his ability to face competition and also on commercial considerations, it said. The committee expressed confidence that PSU oil companies have the in-built strength to face all sorts of challenges from the private players “but it is the government’s duty to control less and less and give real functional autonomy to these companies.” The Parliamentary Committee had also gone into the question of political pressure being applied on the decisions to allot retail outlets and had recommended that an institutional system should be set up in the Petroleum Ministry to inquire into the substance of such complaints.
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HC rejects VSNL selloff petition
New Delhi, August 6 A Bench comprising Chief Justice S.B. Sinha and Justice A.K. Sikri said the disinvestment in Public Sector Units (PSUs) was being done by the government after economic liberalisation under the Structural Adjustment Policy (SAP) in consonance with the IMF’s stabilisation programme. A public interest litigation (PIL), filed by a private organisation — Forum for Justice and Peace — had sought cancellation of the disinvestment agreement with Tata Sons Ltd alleging that it had diverted Rs 1200 crore from VSNL to its group company Tata Teleservices. Rejecting the petition on the grounds that the courts’ power of interference in the government’s policy matters was very limited, the Bench said “we fail to understand as to on what premise the transaction in question is sought to be challenged by the petitioner.” Also rejecting the contention of petitioner’s counsel that the “doctrine of unjust enrichment” as defined under Section 70 of Indian Contract Act was applicable in the case, the Bench said “we have not been able to appreciate as to how the provisions of this doctrine are attracted in this case.” The court said when the country was on the brink of economic crisis in 1980s, the policy of liberalisation was introduced by the government adhering to the IMF’s economic stabilisation programme, which included privatisation of PSUs.
PTI
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VSNL may lose 441cr New Delhi, August 6 Director (Operations) of the Tata-controlled VSNL N Srinath said although the company was optimistic the relationship with WorldCom will continue to be beneficial for both the parties, “there can be no assurance that VSNL will be able to collect its WorldCom receivables or that VSNL will not be adversely affected by WorldCom’s financial difficulties”. VNSL is WorldCom’s carrier partner for exchanging long distance telephony US-bound international long distance telecom traffic. Both the companies have tariff arrangement The US company has recently filed for bankruptcy after it disclosed mishandling of funds in its books to the tune of $ 3.85 billion. Till the end of last month VSNL had made an exposure of Rs 441 crore (approximately $ 60 to 90 million) to WorldCom.
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Infosys revenue may touch Rs 3,244 cr
New Delhi, August 6 As per an estimate by Deutsche Bank, the revenue growth rate during 2002-03 will be lower than growth rate of 37 per cent achieved by the company in the previous fiscal. For the second quarter of the fiscal, the report projects a revenue of Rs 783 crore while for the third and fourth quarter, it stated that the revenues could touch Rs 823 crore and Rs 872 crore. In the last fiscal, it’s revenue stood at Rs 2,603 crore. Earnings before interest, tax, depreciation and amortisation (EBITDA) is likely to increase to Rs 1,213.5 crore during the 2002-03 fiscal against Rs 1,037.6 crore in 2001-02 fiscal. The Deutsche Bank report projects an EBITDA of Rs 296 crore in the second quarter and Rs 312 crore in the third quarter while for the fourth quarter, it has been projected at Rs 330 crore. Infosys posted Rs 273 crore EBITDA in the first quarter of the curent fiscal. During the fiscal, profit after tax (PAT) is likely to be at Rs 947 crore against Rs 807 crore in the last fiscal. In Q2, the report says PAT can be Rs 228 crore while in Q3 and Q4, it is likely to be Rs 244 and Rs 259 crore. Infosys posted a PAT of Rs 215 crore in the first quarter. On the new growth opportunities, the Deutsche Bank report says Progeon, the business process outsourcing (BPO) outfit of Infosys, needs to pursue an inorganic strategy to build capabilities and credibilities in these areas. The outfit had a revenue of $ 43,000 during Q1 of the current fiscal. On the margins, it says, over a 305 year time-frame, various factors will impact margins negatively. Investments in BPO and IT outsourcing initiatives wherein margins will be lower than the core business will impact margins going foward — though not over the immediate quarters or years, the report says. “However, this will result in steady business flow and a healthier top-line growth, which will ensure that earnings growth is sustained”, Deutsche Bank report said. Stating that margins concerns were overdone, the report says in the first quarter (April-June) of the current fiscal, its margins were impacted negatively on two accounts — on gross level due to a higher on-site component and on the EBITDA level, owing to a jump in sales and marketing spend.
PTI
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Govt clears 610cr FDI proposals
New Delhi, August 6 Earlier, the Foreign Investment Promotion Board (FIPB) had submitted its recommendations to Commerce and Industry Minister Murasoli Maran for approval and clearance, an official statement said here. iSolutions along with Amit and Marendra Patni, GE Capital Mauritius Equity Investment, General Electric Mauritius, Bank of New York and GE APC Technology Capital Mauritius plan to hike their combined 39.21 per cent stake in software services company Patni Computer Systems to 60.49 per cent at Rs 521.37 crore investment. The 18 proposals pertain to sectors like integrated townships, cargo handling, cash and carry wholesale trading and software development. Other proposals cleared include Malaysian firm Kontur Bintang Sdn Bhd’s Rs 72 crore FDI in acquiring 74.04 per cent equity in Feedback Integrated Infrastructure Developers Pvt Ltd for setting up an integrated township in Gurgaon. Also, Indonesian company PT Buana Mega Bimsakti’s plan to set up a wholly-owned subsidiary for cash and carry out wholesale trading of sports and lifestyle products was given the go-ahead. The proposal envisages Rs 10 crore FDI inflow and the subsidiary will be set up in Mumbai. Advertising major Publicis Worldwide BV plans to acquire total control in Indian subsidiary Zen Communications, which is now called Publicis India Pvt Ltd. The proposal envisages infusion of Rs 11 lakh FDI in increasing stake from 64.66 per cent at present to 100 per cent.
PTI
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IndusInd Bank starts Internet banking Chandigarh, August 6 Mr Basu was addressing customers, at the newly opened branch at Panchkula. The branch was inaugurated by Mr T.C. Gupta, Senior Regional Manager, FCI, (Haryana). He claimed that the bank has registered a net profit of Rs 17.48 crore in the first quarter of the financial year 2002-03 as against Rs 11.37 crore in the corresponding period last year, a growth of 53.74 per cent. The bank had recorded a total income for the quarter at Rs 239.91 crore, up from Rs 200.06 crore for the corresponding period, last year, registering an increase of Rs 19.22 per cent. The IndusInd Bank with its net worth at Rs 561.92 crore, had grown significantly in terms of advances and deposits since its inception.
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Tata Steel plant for S.Africa
Johannesburg The plant, to be built at either Richards Bay or Coega, will create 115 new jobs. Tata had originally wanted to base the plant in Queensland, Australia, after delays in South Africa's incentive scheme.
IANS
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