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Chandigarh hotel to be ready by Divali: Narang
Transformer repair units oppose excise duty Luring customers with cheap housing loans Business on LSE touches Rs 170 cr |
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Anil Agarwal set to join UK billionaire club IT industry targets 28 pc export growth The Indian IT industry is aiming to notch up a 28 per cent growth in exports this year, a top industry official said today. "We hope to log an export growth between 26-28 per cent over last year," Kiran Karnik, President of Nasscom said. Haryana in a dilemma over
cane price issue Even as the cane crushing operation by cooperative sugar mills of Haryana is slated to start from the next week, Mr Om Prakash Chautala is believed to be in a dilemma on the issue of price of cane to be paid to farmers by the mills. SBI to upgrade office in China The State Bank of India will bring in $ 12 million as capital to start commercial banking operations in China and upgrade the representative office here in the city.
Sensex to remain depressed till Jan
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Chandigarh hotel to be ready by Divali: Narang
New Delhi, November 16 In fact, the group will aggressively expand its footprint over the next couple of years and is looking inwards at various locations in the country. “We are definitely expanding. But the geographical spread will mainly be by acquisitions through management contracts. We are not considering taking up green-field ventures at the moment”, Chief Operating Officer (COO) of Taj Business Hotels Jyothi Narang said in an exclusive interview. Ms Narang said the group is looking at increasing its spread in cities such as Gurgaon, North Mumbai and near Chennai airport. “The company anticipates that a significant portion of its long-term growth will come from the expansion of this brand and is actively seeking ways of strengthening and expanding this brand”, she said. The Taj Business Hotels has acquired the shell of a hotel built by the ITDC in Chandigarh. This may well mark the first of the Taj group in
northern India (excluding Delhi and Rajasthan). “We are expecting the Chandigarh hotel go on steam before Divali next year”, Ms Narang said, adding that the group was looking for management contracts with freshly built hotels in Ludhiana and Kanpur. The group is looking at adding “seven or eight” hotels more in the next five years. It, at present, has a total of 23 business hotels, 18 in India, two in Colombo and one each in Yemen, Dubai and Lusaka. The hospitality industry is, at present, experiencing a virtual boom and it is generally felt that this a good time to invest. This can also be gauged from the entry of international hotel chains in the country. “We feel that there is a definite economic upturn in the economy and we want to reap the benefits of this upturn. Our brand positioning will be different from other international hotels and will offer more than what competition is offering at the same price”, she said. The company has recently announced a three-year two-phase refurbishment plan for its hotels. The COO of the company said the move is based on a survey commissioned by the group to find out the needs of the business
traveler during his stay. At present, 60 per cent of the corporate travellers are Indians and 40 per cent are foreigners. “There are four basic levels of needs — basic needs, standard ego needs, needs to combat loneliness and need to de-stress. While the first two requirements are met by most hotels, what came as a surprise to us the need for the executive
traveler to de-stress”, Ms Narang said. To this end the company is, at present, implementing a massive renovation exercise, including some innovations which were
hitherto unheard of in the Indian hospitality. “At the basic level we decided to do two things — give him what he does not get at home and over deliver at the basic need level at almost the same price point”, she said. To address the requirements of de-stressing, the refurbished rooms will do away with bathtubs and instead have dual showerheads and individual steam unit, Ms Narang said. Moreover, inside the room area, a mobile desk work will be introduced with a Herman Miller
agronomical chair, each costing $600. The first phase of this refurbishment is being rolled out at Taj Residency, Bangalore, and will be followed by Taj President, Mumbai. After pressing ahead with a premium line of luxury apartments in Mumbai, Wellington Mews, the group is also exploring the prospects of setting up a second brand of service apartments. “While Mumbai and Delhi can be ideal locations for prospective luxury apartments, the second line of apartments can come up in cities such as Pune and Bangalore”, she said but hastened to add that the proposal is “still a thought”. The foray into the service apartments is based on a strong growth assumptions in various sector, including the IT-enabled
services (ITES) and the business process outsourcing (BPO) segments. “Why only ITES and BPO. We are assuming an influx of foreigners in all sectors”, she said, adding that the flow of foreigners will be strong enough to justify the huge investments in the service apartment category.
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Transformer repair units oppose excise duty Panchkula, November 16 The industry is up in arms against the duty, saying since they are merely repairing the defunct transformers, by retaining over 60 per cent of the parts of old transformer, this duty cannot be imposed on them. Moreover Sales Tax Department and Income tax Department have also recognised them as the repair industry. The Excise Department has, however, imposed duty on the pretext that they are manufacturing new transformers after taking two parts of the old and defunct transformers from the PSEB and the Uttar Haryana Bijli Vitran Nigam (UHBVN) and thus they have to be brought under the excise net. That is why the department has now begun an exercise of summoning records from this industry. Already notices have been issued to some of these transformer repair units and they have been asked to pay duty, ranging from Rs 20 lakh to Rs 1 crore. The industrialists now say till date their work has been recognised as repair work by the Sales Tax Department and Income Tax Department, thus sales tax is deducted at source and the electricity departments too deduct income tax at source on the pretext that they are merely contractors for repair work. Even the tender specifications in the notice inviting tenders, work orders by the UHBVN and PSEB, mention that the transformer is being given to us for repair. "So how can another government department treat us as a manufacturing industry," they say. The industrialists say because they are considered a repair industry they have not been claiming any benefit under Modvat. All over the country, their industry is recognised as a repair industry, but it was only in the Panchkula circle of the Central Excise Commissionerate that they have been asked to pay central excise duty. The units in this commissionerate do business worth Rs 12 - 15 crore annually. In case, the duty has to be levied, it should be done all over the country, and central excise duty worth Rs 500 crore can thus be recovered. They have now sought the intervention of Central Board, Excise and Customs on this issue. Excise officials, on condition of anonymity, however, said even if the other government departments are recognising them as repair contractors, under the excise laws, the works of this industry is considered as manufacturing, and thus they have initiated the process of bringing the industry under central excise net.
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Luring customers with cheap housing loans Chandigarh, November 16 Industry analysts, however, warn customers that they must read the fine print carefully, before taking a housing loan. Since the banks interest rates are continuously falling over the past few years, they must compare the processing charges, legal fees and the penalty imposed by the banks to transfer the balance loan to other banks in case of further fall in interest rates. Says Mr G.S.Sood of Punjab National Bank, "Some private banks may offer house loan at the lower interest rates, but these include hidden costs like processing fee, legal and technical fee, besides higher penalty charges for shifting the loan to other banks." Some banks are asking for 0.75 per cent as an upfront fee and will calculate interest annually, instead of daily reduced basis calculated by the public sector banks. He claims that under the ongoing festival bonanza, PNB is offering housing loans for 1-5 year at 7.75 per cent and for 5-10 year at 8.25 per cent interest rate under the floating interest rate scheme. At 8.25 per cent interest rate, for a 10-year loan of Rs 1 lakh, the equally monthly installment will be Rs 1,210. Mr Ravindra Sudhalakar, Regional Business Head (North) ICICI Home Finance,"Out of over Rs 275 crore monthly market of housing loan in Punjab, Haryana and Chandigarh, ICICI has a share of around 30 per cent."Under a promotional scheme, the bank is offering 7.5 per cent interest rate for all maturity periods. The scheme is valid till November 26. He, however, admits that the customer will have to pay 0.5 per cent of the total loan amount as processing fee, but there will be no technical or legal fee. Customers availing the bank's Balance Transfer Scheme during this period will also benefit from no fee for home loans transferred to ICICI Bank from their existing bank or housing finance company. On a loan of Rs 1 lakh for up to 5 years, at the rate of 7.5 per cent interest rate, the EMI of the ICICI Bank loan will be Rs 2,004, and at 7.75 per cent interest rate for 20 year period, it will be Rs 821. A senior official of the SBI admitted that ABN Amro Bank is offering housing loan at 6 per cent for the first year, 6.5 per cent interest rate for the second year and 7.75 per cent for 20 year loan. HDFC is offering house loan at 8 per cent interest rate for 20 year for less than Rs 10 lakh. For loans more than Rs 10 lakh, HDFC is charging 7.75 per cent interest rate.
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Business on LSE touches Rs 170 cr Ludhiana, November 16 The volumes of business on the LSE have been rising since April, 2003, and the highest volume of business was recorded on September 24 at Rs 184 crore against Rs 70 crore till March thus recording a quantum jump of over 143 per cent during this period. Our of these daily volumes of Rs 170 crore, about Rs 90 crore representing about 65 per cent comes from trading in futures and options (derivatives). According to Mr RC
Singal, Director and former president of the LSE, the main reason for the bull run on the bourses is heavy inflow of foreign funds by foreign institutional investors
(FIIs). Over 75 per cent of the FIIs now operating in Indian stock markets are new entities which show their confidence in the stocks. With the continuous and sustained fall in the interest rates for deposits in bank and other securities, funds have been diverted to the capital markets. Experts opine with a very good monsoon, economy is already reviving and feel-good factor is evident and it is hoped that the industry is going to improve further with the demand picking up in almost all sectors and particularly in cement, steel, paper,
pharma, consumer durables and automobiles. Over the past couples of months it has been witnessed that delivery based transactions have increased from about 15 per cent to 31 per cent on exchanges. This also indicates towards the entry of small investors in the market. With the promulgation of new delisting guidelines by SEBI in February, 2003, many companies have applied to the LSE for delisting of their shares which will adversely affect the revenue of the exchange. However, to compensate for this loss the LSE management has taken many measures such as cutting and recovery of outstanding listing due from defaulting companies and exploring other sources of revenue generation. |
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| Anil Agarwal set to join UK billionaire club London, November 16 The float of Vedanta will be the biggest listing in the city this year and will be the first primary listing of an Indian firm in the London market. It will emerge this week that Agarwal will have a paper fortune of at least £ 800 million when he floats the company, The Sunday Times reported. Vedanta, the newly-formed holding company for the Mumbai-based Sterlite Industries, will publish its pathfinder prospectus on Thursday. The company, which is 100 per cent owned by the Agarwal family, is estimated to be worth between $ 1.3 billion (£ 770 million) and $ 1.4 billion. This is before a proposed $ 700 million fund raising, which will dilute his stake to about 60 per cent. Agarwal, who has bought a £ 20 million home in London’s Mayfair, is applying to become a British resident. If his other assets are included, he should appear in the billionaire league and be one of the Britain’s 20 richest individuals.
— PTI |
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IT industry targets 28 pc export growth
Kolkata, November 16 "We hope to log an export growth between 26-28 per cent over last year," Kiran Karnik, President of Nasscom said. India's IT exports stood at $9.5 billion in 2002-03. The industry, worth $16.5 billion in 2002-03, accounted for 3 per cent of India's GDP in 2002-03. The IT industry also employs over 7,00,000 professionals. The industry hopes to generate revenue of around $80 billion by 2008, Karnik said. Nasscom expects the growth in exports despite a slowdown in the global economy. "The picture looks good despite a slowdown in world economy. The first half of this fiscal hasn't been good, but things will look up later in the year," Karnik said at a press conference here. The expected growth would come more from the increasing business process outsourcing (BPO) sector than the services sector. "Let's say the breakup will be like BPO 40-45 per cent and services 18 per cent," Karnik said. The US is the Indian IT industry's biggest export market at 71 per cent followed by the UK at 14 per cent and rest of Europe at 9 per cent in 2002-03. Nasscom is trying to create new markets in Europe, South America and Japan. "The US remains our single largest market, but it's time we looked at newer business generation centres. This takes time, but we are working on it," Karnik said.
— IANS
Haryana in a dilemma over
cane price issue Chandigarh, November 16 While an increase in the price of cane will be politically expedient for the Chief Minister—as Lok Sabha polls to be held the next year— the sugar mills have made it clear that any expenditure on cane payment over and above the statutory minimum price(SMP) of cane fixed by the Centre would have to be borne by the state government as grant. Significantly, the issue of repayment of loan already extended by the state government to the sugar mills have still remained unresolved with the Finance Department insisting on repayment and the sugar mills putting the onus of the debt burden on the high SAP fixed by the government. |
SBI to upgrade office in China Shanghai, November 16 “We are in the process of getting the required permission from the People’s Bank of China (PBOC),” chief representative of the SBI’s Shanghai representative office Rakesh Sharma told PTI here. Sharma said the SBI, which opened its representative office in Shanghai, in 1997, has submitted relevant papers to the PBOC and was in touch with the Chinese apex bank. “We hope to start operations by July-September, 2004, if everything went as planned,” he said. The SBI would bring in foreign currency equivalent to $ 12 million to start commercial banking operations in China. Initially, the SBI plans to have foreign currency banking operations with overseas entities, joint ventures and foreign institutions, Sharma said. Once the PBOC approval is received, the SBI representative office would move out to the Pudong financial district and open a new and larger office, he said. — PTI |
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Sensex to remain depressed till Jan The stock market has lost momentum. While on November 3 the Sensex stood at 5063 points which was a 3-year-high peak, the Sensex closed last Friday at 4865.83 points — a loss of 197.17 points. In fact, last Friday the Sensex plummeted 83.33 points. The market outlook for the current week is bearish. I had stated in the previous issue of this column that the market would continue to remain depressed till the first week of January. I hold the same view even now. This analysis is based on the three major considerations. First, now that September quarterly results have been announced, there is hardly any trigger for the market to shoot up during the next two and half months. Secondly, during these two months, FIIs will stay out of the “buyer market”. They are likely to be sellers for they have to prepare and consolidate their annual accounts. Even last Friday, they sold a part of their investments in Reliance, Tisco, Telco and some PSU oil companies. The third reason is that election and Telgi scam, etc. will take away investors and speculators from active participation in the stock market. The present bearish phase cannot, however, be interpreted that the Indian economy is not doing well. The long-term assessment about the bull stock market stands. The present depressed market is only in nature of a short pause or a breather. The RBI has revised its April, 2003, forecast regarding the GDP growth rate upward from 6 per cent to 7 per cent. In its mid-year economics review released by the Finance Ministry last week, more than 7 per cent GDP growth has been projected during the current fiscal year. The industrial growth rate in September this year was at 6.5 per cent though there was a slight decline next month. The NCAER Quarterly Index of Business Confidence indicates that the index stood at 129.4 per cent — it is the highest since 1995. It was 3.6 per cent more than the previous statement made in July. The World Bank and the international institutions have also projected the higher GDP growth rate for India. The investors should clearly understand that the present is more than a mere normal reaction in the bull market. It is a rather two months long breather in the onward march of the stock market. The investors should wait for some further decline to pick up blue chi equities for long-term investments. Last Saturday, the stock market was functioning and there was the distinct revival. But this week the market is likely to move down in narrow range fluctuation. Nahar Industries Enterprises had been recommended in this column when it was quoting at Rs 16.50 (now it has moved up to Rs 28 after touching Rs 29). Those who hold this share should not book profit at this stage. The company is likely to declare dividend next year and the scrip is likely to move up further. I will recommend investments in the two scrips for appreciation as well as good dividends: Balmer Lawrie Van Leer (at present quoting at Rs 16.50) and Lumax Auto (quoting at Rs 55).
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New Delhi, November 16
