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Indo-Gulf, Birla Global to merge into Indian Rayon
Bangalore loss can be Chandigarh gain
Silk route to reopen on October 2
Service sector poised for high growth: FICCI
PF, NSC maturity value free from TDS
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Wind power set to
be hot sector
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Indo-Gulf, Birla Global to merge into Indian Rayon
Mumbai, September 11 Under the merger scheme, three shares of Birla Global Finance and Indo-Gulf Fertilisers would fetch one share of Indian Rayon, the AV Birla Group Chairman Mr Kumarmagalam Birla, told reporters here. The merger was part of the major restructuring of the group’s financial services business, he said. “The swap ratio is expected to translate into a reasonable premium to both Indo-Gulf and Birla Global Finance shareholders, based on the current Indian Rayon price,” the company said. Post restructuring, Indian Rayon will emerge as one of the large private sector companies in India, Indian Rayon Managing Director Sanjeev Aga, who will also head the new entity, said. The consolidated accounts of Indian Rayon as on March 31, 2005, with the results of the two merging companies, translates into sales of Rs 3,980 crore (an increase of 25 per cent), net profit of Rs 150 crore (increase of 150 per cent) and net worth of Rs 1,825 crore (60 per cent increase). Mr Birla said through the exercise, the Aditya Birla Group was making efforts to use profitable cash generated from companies like Indo-Gulf to promote high-growth businesses like IT and
IT-enbled services, garments, financial services and telecom. “They provide us with robust cash flow but they do not have very large cash requirement to carry them forward. So we are saying that we will use the cash flow to invest in high-growth areas that we are trying to promote,” he said. However, he clarified that this did not mean that the group had any intention to sell, divest or hive off “core” businesses. Elaborating, the Birla said even though the fertiliser business had seen steady profits, regulatory uncertainties constrained growth avenues, making accelerated value creation difficult. “Becoming a part of the Indian Rayon should provide Indo Gulf a broader canvas to participate in enhanced value creation,” he said. For Birla Global, the merger would mean participation in financial services beyond mutual funds into life insurance, as the financial services business of the group gets consolidated under Indian Rayon. Mr Birla said in financial services, the company was looking for entry into the pension fund sector as and when it was opened up for the private sector apart from focus on life insurance and mutual funds.
— PTI
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Bangalore loss can be Chandigarh gain Bangalore, September 11 The announcement of the boycott of the event by the BCIC follows an earlier announcement by the Bangalore Forum for Information Technology (BFIT) that it would not participate in the fair. With majority of IT companies being members of the BFIT and BCIC, major IT companies will remain out of the government fair. The state government had apparently been unmoved by the boycott call given by the BFIT last month saying they were not representative of the industry and hardly even participated in the IT fair. As of now, the BCIC does not seem too convinced with the government’s response. “Though there are long-term plans for the development of the city, even they have been kept pending and no one delivers on them”, said BCIC secretary Sampath Kumar while talking to TNS yesterday. Mr Sampath Kumar said Bangalore’s loss could be a gain for other places, including Chandigarh which had put its infrastructure in place before inviting IT companies to invest in the city.
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Silk route to reopen on October 2
Nathu La (India-China border) September 11 Perched at an altitude of about 4,500 metres and some 52 km east of Gangtok, capital of the north-eastern state of Sikkim, the sensitive border pass of Nathu La is all set to bustle with activity. “There is tremendous enthusiasm with border trading expected to begin on October 2 with the reopening of the traditional silk route,” Mr B.B. Gooroong, a Sikkim Government spokesperson, told IANS. Nathu La, overlooking the Chumbhi valley of Tibet, was a major border trading point between the two countries until the bitter boundary spat between India and China in 1962. The two countries in 2003 agreed to reopen border trading here. “Infrastructure development and construction of roads leading to Nathu La is going on at a brisk pace and everything should be complete before the deadline,” Gooroong said. The items of export include vegetables, blankets, tea, coffee, textiles, watches, shoes, canned food, tobacco, ice and dry fruits. The import items are goat skin, sheep skin, sheep wool, raw silk, yak tail, china clay, goat wool or pashmina,” a Sikkim industry official said. The prospects of border trade have generated a lot of interest among the locals in the tiny state with the small village of Sherathang, about 5 kilometres from Nathu La, likely to be the business hub. “Once trading resumes, economy of the region would change for the better and the tourism sector get a tremendous boost,” Sikkim Chief Minister Pawan Kumar Chamling said. “Once this route is opened, there would be immense possibilities of trade and commerce,” he added. Currently India’s trade with China is around $ 5 billion. According to a report prepared by the CII, the growth in bilateral trade between the two countries was projected at almost $10 billion within three years of the opening of Nathu
La. — IANS
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Service sector poised for high growth: FICCI New Delhi, September 11 The FICCI survey, based on interactions with representatives of various service providers and operators, service- related associations and companies in both private and public sectors, shows that the segments projected to achieve “excellent growth” are retail trade in the organised sector (35 per cent), road transport (22 per cent)and domestic air passenger traffic (25 per cent), international air passenger traffic (20 per cent), total air cargo handled (20 per cent), domestic air cargo (22 per cent), value- added postal services (30 per cent), telecom subscribers (30 per cent), mobile subscriber (60 per cent), internet subscriber (30 per cent), internet users (60 per cent), housing finance (30 per cent), mutual funds (20 per cent), insurance premium ( 40 per cent), tourism and hotels (25 per cent)etc. The segments likely to experience “moderate growth” are overall retail trade (9 pc), railway passenger traffic (9 per
cent), construction (6-7 pc) and music industry(4-5 pc).
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by S.C. Vasudeva PF, NSC maturity value free from TDS Q. I want to know the following facts related to the Income Tax Act: 1. What is the slab of income tax during the financial year 2005-06? 2. Whether the interest of NSC VIII issue reinvested is allowed under Section 80C with in the limits of Rs 1 lakh? 3. Whether on maturity of PF/NSC any income tax will be deducted ? — Suresh Seth A. The answers to your queries are as under: 1. The income-tax slab for the financial year 2005-06 in the case of every individual other than a woman resident in India below the age of 65 years or an individual resident in India who is of the age of 65 years or more or Hindu Undivided Family or association of persons or body of individuals, whether incorporated or not, or every artificial juridical person referred to in sub-clause (vii) of clause (31) of Section 2 of the Act is as under:- Rates of income tax: 1. Where the total income does not exceed Rs 1,00,000: Nil 2. Where the total income exceeds Rs 1,00,000 but does not exceed Rs 1,50,000: 10 per cent of the amount by which the total income exceeds Rs 1,00,000. 3. Where the total income exceeds Rs 1,50,000 but does not exceed Rs 2,50,000: Rs 5,000 plus 20 per cent of the amount by which the total income exceeds Rs 1,50,000 4. Where the total income exceeds Rs 2,50,000: Rs 25,000 plus 30 per cent of the amount by which the total income exceeds Rs 2,50,000. In case of women resident in India, who is below the age of 65 years, the income up to Rs 1,35,000 is not taxable. Accordingly, in slab 2 above, Rs 1,35,000 will be substituted instead of Rs 1,00,000. In case of an individual who is of 65 years or more having income up to Rs 1,85,000 is not taxable. Accordingly, in slab 3, Rs 1,85,000 will be substituted instead of Rs 1,50,000. 2. The interest of NSC VIII issue, if re-invested, would be covered under Section 80C of the Act for the purposes of granting deduction under the said section. 3. At present, the law does not provide for any deduction of tax at source in respect of maturity receipt of Provident Fund/NSC. PPF ceiling Q. I have under-mentioned queries: 1. For the F.Y. 2005-06, can the maximum ceiling of Rs 1 lakh as deduction be claimed by investing in public provident fund or like previous F.Y. its maximum limit is Rs 70,000 & balance by investing Rs 30,000 in infrastructure bonds. 2. For the current F.Y. if the ceiling for PPF is Rs 70,000, can I claim deduction of maximum Rs 1 lakh u/s 80C by investing Rs 30,000 by opening a PPF account in the name of my son who is a minor. — Umesh Chopra A. The maximum limit provided for in Public Provident Funds Rules is Rs 70,000 only. The Public Provident Fund rules also now provide that an individual can have only one PPF account across the length and breadth of the country. Accordingly, you will have to invest Rs 30,000 in another saving scheme covered by provisions of Section 80C of the Income-tax Act 1961 (The Act), so as to claim the total deduction of Rs 1 lakh under the said section. IT return Q. I am a government employee and all my tax is deducted at source by the office. This year while filing my return, I forgot to add Rs 9,500 as Long-Term Capital Gain as gain from mutual fund. This gain is tax-free and by adding, there would have been no change in my tax liability. There is no refund/to be deposited in tax. Please advise me whether I should revise my return or it is not required? — Jasbir Singh A. It would be better to revise the return so as to give the details of your tax-free income. In my opinion the correct information must be on the records of the department so as to save you from any complications in future. Tax liability Q. I am a government employee. My total salary from all sources is Rs 3.10 lakh per annum. My total subscription towards GPF is Rs 85,000. My house loan repayment instalment is Rs 6,000 per month. Kindly let me know my tax liability as per the new slab and sections for the assessment year 2006-2007. — B.S. Barwal A. The total deduction allowable to you under Section 80C of the Act is Rs 1 lakh. On the basis of the figures given in your query, the total taxable income earned thus be Rs 2,10,000. The tax liability thereon would be Rs 13,770 including education cess of 2 per cent. PF withdrawal Q. I worked with a Pvt Ltd Co from 01.12.1998 to 30.09.2003 (2 months less than 5 years). Due to some problems, the production was stopped and the company’s business discontinued. Thereafter, I have not obtained employment with any other employer because of age factor and ill-health. I have not yet withdrawn my PF from the PF Organisation. Please advise on the following points:- (i) Is there any time limit during which the PF must be withdrawn or it can be withdrawn whenever I want? (ii) Will there be any tax deduction when PF is withdrawn and what are the tax norms? — A.L. Sharma A. The answers to your queries are as under: The answer is based on the presumption that the fund is being maintained by the trust and is a recognised Provident Fund. (i) The time limit for withdrawal will depend upon the regulations of the fund governing the administration of the trust. (ii) The mount of accumulated balance in your provident fund account would be taxable in your hands in accordance with the provisions of the Act. This is because you have not rendered a continuous service of 5 years with the company. Exempt Exempt Tax Q. Will you please elaborate referring to respected Finance Minister’s Budget speech where a lot of emphasis was laid for shiftover from present "EEE" to ‘EET’, please elaborate its likely implications after the constituted committee recommends on the people having insurance policies, PPF A/cs etc on maturity. — Umesh Chopra A.
The Finance Minister has constituted a committee for shifting the
present system of allowing deduction for investments in various
schemes which come under the category of "EEE" to the
category of "EET". The Finance Minister had explained in his
budget speech that the shift from "EEE" to "EET"
would be based on the recommendations of such committee and he would
come up with complete details in this regard in his next year’s
budget. The committee is yet to give its recommendations. The
indications are that the shift would not be retrospective in
operation.
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by Lalit Batra Wind power set to be hot sector The markets breached the much-talked-about 8000 barrier last week. The strong momentum continues and there is enough buying that is helping the market to sustain the gains. The unprecedented liquidity flowing into the Indian markets has capped the downside and the expected correction has not materialised. The BSE Sensex gained 2 per cent to close at an all-time high of 8060, Nifty also gained close to 40 points to close at 2455. The market has been on a bull run for a while now but the latest surge has been quite sharp and swift — it took just 55 days for Sensex to move to 8,000 points it had first hit the 7,000 level on June 20, 2005. Wind power Harnessing power from wind, which was a dream, has now become realty. The Ministry of Non-Conventional Energy has estimated that by 2012, 10 per cent of the projected 240,000 MW of the new capacity will come from renewable, mainly wind power. The wind energy sector in India has been one of the major success stories of the renewable energy programme with a growth of about 44 per cent during the past financial year. Since India is a power-deficit country and with a major thrust on power generation, wind energy is set to become a hot sector to be in. The major companies involved in wind power are NEPC India and Suzlon. NEPC India The company started its commercial production in 1991, but it met a roadblock from 1994 onwards to unrelated diversification in the area of air taxi operation. However, due to the mounting losses the company had no choice but to discontinue airline business. Thereafter the company focused on water pumping, windmills and generators. NEPC is now one of the leading players in the wind energy segment. NEPC manufactures a wide variety of wind turbines ranging from 225 KW to 750 KW. NEPC has grown at a robust pace in the past four years. From the installation of 59 wind turbine sets in 2002, the company has installed 348 sets during the past fiscal. The company expects to sell close to 700 sets during the current financial year. Though the company’s performance on the operations front has shown phenomenal improvements, the financial performance has not kept pace due to the writing off of bad debts. The company is extremely bullish on the prospects of wind energy in India. It is the only wind power company listed on bourses and the stock currently trades at Rs 45. Suzlon Suzlon offers total wind power
solutions, which includes consultancy, design, manufacturing and
O&M service of windmills. The company is one of the fastest
growing wind energy companies in the world and ranks amongst the top
10 companies in the segment globally. The company last year reported
sales of Rs 1917 crore and a net profit of Rs 361 crore. Suzlon has
shown remarkable performance in the past three years. The company has
recently field the red herring prospectus with SEBI and is expected to
come out with an IPO soon. It would be worth to wait for this IPO. |
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