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Equip RBI with more powers
SAIL mulls equity in coal mines
NTPC to foray into nuclear power
Govt to review regulation on LPG supply
OVL pays Rs 105-cr dividend, to invest $150 m in Cuba blocks
Oil ministry signs 18 exploration contracts
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McDowell is United Spirits now
Bharti launches set top boxes for DTH services
Ion Exchange to launch new water purifiers soon
L & T, Tata Steel to build
Steel Ministry looks for partners abroad
RIL to expand refinery capacity
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Equip RBI with more powers
New Delhi, September 23 While the amount of siphoning off of funds, if any, is a matter of speculation at this stage, experts tracking the developments in the capital markets have struck a note of caution saying that the existing system needs to be strengthened further to prevent manipulators from taking advantage. Notably, two important Bills pertaining to banking reforms, the Banking Regulation (Amendment) Bill, 1949, and the Reserve Bank of India (Amendment) Bill, 2005, are yet to be passed by Parliament. Presently, though the RBI has the power to remove any director or other official of a bank but that power is not sufficient if the entire BoD of a bank is functioning in manner detrimental to the interests of the depositors and bank itself. The Banking Regulation (Amendment) Bill, once passed by Parliament, will empower the RBI to supersede the BoD of a bank and appoint an administrator to manage the bank. Importantly, it would also provide the RBI necessary legislative teeth to order a special audit of cooperative banks. This is significant because the investigations in the earlier scam have thrown up enough evidence about the sinister nexus of some urban cooperative banks with broker entities. In the absence of careful regulation, such broker-entities used large funds provided by these cooperative banks to manipulate the stock market. The Reserve Bank of India (RBI) has defined that siphoning of funds should be construed to have occured if any funds borrowed are utilised for purposes unrelated to the operations of the borrower, and is detrimental to the financial health of the entity or of the lender. Significantly, however, the decision as to whether a particular instance amounts to siphoning of funds would have to be a judgement of the lenders based on the objective facts and circumstances of the case. The Joint Parliamentary Committee (JPC), which went into the details of the circumstances leading to the earlier stock market scam, had pointedly noted that the Banking Regulation Act, 1949, does not include any provision as to the rights and responsibilities of borrowers or depositors.
No scam, FM assures investors
Unperturbed by the upheavals in the Indian bourses, Union Finance Minister P. Chidambram today said there was no scam in the stock market, which is well regulated. “There is no cause for concern ... There is no scam in the market but there could be one or two ‘adventurous’ players in the market,” he told CNBC TV18 in New York. He said the Price to Earnings ratio for Nifty, Sensex, Nifty Junior, S&P 200 are well within comfort zone. “It’s a well-regulated market. So one should not be unduly worried when the market rises or falls rapidly,” he said. Mr Chidambaram denied reports that the office of Prime Minister Manmohan Singh has been in touch with him over the stock market’s movements and said: “There is no scam” in the market. He said the upcoming fiscal second quarter earnings would be a good indicator of whether investors has gauged corporate performance correctly. “We should wait for the second-quarter results... if they turn out to be as good as the first-quarter results, then the conclusion is that the market anticipated the second-quarter results,” he added.
— PTI
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SAIL mulls equity in coal mines
New Delhi, September 23 For SAIL, a major area of concern has been obtaining new mining leases and renewal of old leases, SAIL Chairman V.S. Jain told shareholders at its annual general meeting. The ‘Navratna’ company required 20 million tonnes of coking coal to produce 22.5 million tonnes of hot metal, SAIL Director (Technical) K.K. Khanna said. Steps are being taken to support BCCL and CIL to enhance indigenous production, he said. Besides, SAIL has planned to develop large capacity mine of 7 MTPA at Chiria, Company Director (Personnel) S.K. Roongta said. Organisations like Mecon, Neeri and the Indian Bureau of Mines are engaged in preparing studies for the project, he added. Mr Roongta said SAIL was pursuing the issue of renewal of mining leases relating to Chiria and was seeking help from the Central and state governments for providing required linkages of iron ore so as to ensure availability for meeting the company’s long-term growth plan. “We are also exploring strategic alliances, JVs for coking coal mines abroad,” Mr Khanna said. Over Rs 3,500 crore of capital schemes are underway to enhance the company’s hot metal production capacity by 8 million tonnes by 2011-12, Mr Jain said. Meanwhile, Steel Minister Ram Vilas Paswan said at Bangalore yesterday that SAIL and the Vishakapatnam steel plan were in the process of arriving at equity tie-ups in three countries.
— PTI
Bhilai unit bags PM’s trophy
Bhilai Steel Plant of SAIL has bagged the Prime Minister’s Trophy for the sixth time. Adjudged the best performing integrated steel plant in the country during 2003-04, it will also get a cash award of Rs 1 crore for this achievement. Mr V.S. Jain said the company’s performance touched a new peak during 2004-05 with net profit zooming by 171 per cent to a record level of Rs 6,817 crore and turnover touching Rs 31,800
crore.— UNI
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NTPC to foray into nuclear power
New Delhi, September 23 “NTPC has enhanced its capacity addition target from 11,558 MW to 17,052 MW for the 11th Five Year Plan and intends to became a 66,000 MW plus company by 2017,” Mr C.P. Jain, Chairman & Managing Director of the company, said while addressing the shareholders of the company at the 29th Annual General Meeting of the company in New Delhi today. This was the first AGM of the NTPC after its Initial Public Offering in October 2004. Mr Jain announced company’s special thrust on hydropower, in order to achieve operational and commercial synergy and plans to substantially increase the ratio of hydro projects in NTPC. He further informed that the company has identified integrated coal mining-cum-power projects to enhance its fuel security and mitigate fuel risk. The company has also decided to participate in the entire value chain of NG/LNG covering exploration, equity stakes in gas fields, liquefaction terminals, transportation and re-gasification. All these backward and forward integration initiatives are primarily aimed at strengthening NTPC’s core business of power generation. The company also has plans to acquire parallel distribution licenses in areas around its projects, while it is targeting to increase power-trading volume substantially. The company is promoting the setting up of a state-of-the-art National Power Exchange to facilitate power trading in the country. On the commercial side, he stated that at present company is collecting 100 per cent of the billing and hopes that this level would sustain in the long run. The company is exploring possibilities to identify and initiate work on merchant power capacity.
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Govt to review regulation on LPG supply
New Delhi, September 23 The government had restricted the number of LPG cylinders per distributor and frozen issue of new cylinders in some areas. This had resulted in households complaining of long waiting period for getting refills. “(The order) has not been effective in checking diversion and black-marketing of subsidised LPG cylinders, which are meant only for domestic use and not for commercial use. We need to rethink... we are reconsidering (the decision),” he told reporters here.
Hefty hike in petro prices sought
Within two weeks of a 7 per cent hike in petrol and diesel prices, public sector oil firms have sought another hefty raise of Rs 8.52 a litre in petrol price and Rs 4.81 a litre in diesel price saying they were losing Rs 1,013 crore every fortnight on selling fuel below imported cost. The oil companies had raised petrol price by Rs 3 a litre and diesel by Rs 2 per litre from September 7 but the current retail prices were far below the imported cost, officials said.
— PTI
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OVL pays Rs 105-cr dividend, to invest $150 m in Cuba blocks
New Delhi, September 23 The dividend cheque was handed over by OVL Managing Director R.S. Butola to ONGC CMD Subir Raha here today. The fiscal 2004-05 has been remarkable for OVL. It secured equity participation in six oil and gas exploratory assets in five countries, viz. Block 5-A and 5-B in Sudan, Block WA306-P in Australia, Block CI-112 in Ivory Coast, North Ramadan in Egypt and Najwat Najem Structure in Qatar. OVL also took up a 741-km pipeline assignment in Sudan as a business development project. PTI adds: Meanwhile, OVL will invest close to $ 150 million in the seven oil and gas blocks it recently acquired in Cuba. The blocks hold more than 4 billion barrels of oil reserves. “The blocks have huge potential and investments could be of the order of $150 million,” ONGC Chairman and Managing Director Subir Raha said here. OVL has entered into an agreement on September 15 with Repsol-YPF of Spain to acquire 30 per cent participating interest in the deepwater exploration Blocks 25, 26, 27, 28, 29, 36 and part of Block 35 in Cuba.
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Oil ministry signs 18 exploration contracts
New Delhi, September 23 The blocks for which contracts have been signed include six deepwater blocks, two offshore shallow water blocks (one each in Cambay offshore and Gujarat-Saurashtra offshore). Ten onland blocks included three blocks in Rajasthan, two blocks in Gujarat and one block each in Andhra Pradesh, Assam, Maharashtra, Tamil Nadu and Uttar Pradesh each. The successful bidders include seven foreign companies — Birckbeck Investment Ltd. (Mauritius), Cairn Energy Plc. of UK (through its seven subsidiaries), ENI of Italy, GeoGlobal Resources, Barbados, Hardy Exploration and Production India Inc., UK, Jubilant Capital Pvt.
Ltd., Cyprus and Niko Resources (NELP-V) Ltd. (a subsidiary of Niko Resources Ltd., Canada). The seven Indian companies, which bagged the contract include Focus Energy Ltd., formerly known as Phoenix Overseas Ltd., GAIL (India) Limited, Gujarat State Petroleum Corporation Limited, Hindustan Petroleum Corporation Limited, Oil India Limited, Oil and Natural Gas Corporation Limited and Reliance Industries Limited. Speaking on this occasion, Petroleum Minister Mani Shankar Aiyar said that the agreement has been signed one week in advance than date fixed by the ministry. The contract discussions were held with the companies in August this year and agreements were reached resulting in finalisation and signing of the PSCs for these blocks, he said. “I am delighted that all the contracts have been bagged by the Indian companies , but sad that despite our efforts not much foreign companies have come forward,” he said. Significantly, the minimum investment committed by the bidders in these 18 blocks is approximately Rs.1653 Crore (US$ 380 Million) in the first phase and Rs. 3771 Crore (US$ 867 Million) in all the three phases of exploration. Awards in respect of two remaining blocks namely AA-ONN-2003/1 (Assam) and AA-ONN-2003/2 (Arunachal Pradesh) are expected to be announced shortly. Mr Aiyar said that the government is in the process of finalizing various activities for the next round of bidding under NELP-VI. The area under exploration in the country has trebled after the implementation of NELP. Gas reserves in the last 3 years have increased by about 50%. In this background, NELP-VI is expected to be launched in early 2006, he
said.
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McDowell is United Spirits now
Mumbai, September 23 The company informed this in a statement to National Stock Exchange here today. McDowell & Company Ltd also approved demerger of the investment business into McDowell India Spirits Ltd (MISL) during the board meeting. The name of MISL will be changed to McDowell Holdings Ltd. In consideration of demerger, the company shareholders will be issued one fully paid-up equity shares of MISL of Rs 10 each for every five equity shares of Rs 10 each held by them in the company. The Board of McDowell & Company also approved amalgamation of the spirits companies into McD. The companies whose amalgamation into McD was approved are — Phipson Distillery Ltd, United Spirits Ltd, Herbertsons Ltd, Triumph Distillers and Vintners Pvt Ltd, McDowell International Brands Ltd, Shaw Wallace Distilleries Ltd, Baramati Grape Industries Ltd and United Distillers India Ltd.
Foreign players ready to invest “The proposals would be considered by the board at an appropriate time,” he informed shareholders at the company’s Annual General Meeting here. Shareholders of McDowell gave their approval to increase the FII investment limit in the company to 49 per cent from the current 24 per cent, as also raise borrowing limit to Rs 5,000 crore.
— PTI
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Bharti launches set top boxes for DTH services
New Delhi, September 23 “The launch of the DTH set top boxes is in keeping with the company’s strategy to diversify into new areas, which offer huge potential for growth,” Mr Rakesh Mittal, Vice-Chairman and Managing Director of Bharti Teletech, told reporters. He, however, ruled out Bharti Group’s entry into DTH arena at this juncture, saying that “there is no such plan. Even the policy on the conditional access system (CAS) is not clear.” With the set top boxes introduced by Bharti, the subscribers would be able to watch 33 free-to-air channels of Prasar Bharati and listen to 12 FM channels, Mr Mittal said, adding that along with set top boxes a small dish antenna would have to be added.
— PTI
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Ion Exchange to launch new water purifiers soon
Chandigarh, September 23 Mr Chopra said with a view to tapping the vast potential in Punjab, the company had recently dropped the prices of the 10-litre ultimate reverse osmosis water purifiers from Rs 19,800 to Rs 14,990. Of the total 124 exclusive ‘Water Marts’ in the country, 54 are in the North. The company has eight such marts in Punjab and Chandigarh. As part of its expansion strategy, Ion Exchange planted to open 200 new Water Marts of which 70 would be in the north.
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L & T, Tata Steel to build port in Orissa
Bhubaneswar, September 23 L&T has joined hands with the Dubai Aluminium Company Ltd (DUBAL) for setting up the integrated aluminium project in Rayagada district envisaging a three million tonnes per annum capacity alumina refinery, smelter, bauxite mining and development of associated infrastructure. While the refinery would be located in Rayagada district, the site for the smelter and 80 mw captive power plant was yet to be decided, L&T Chairman-cum-Managing Director A.M. Naik said. The company had also joined hands with Tata Steel to promote a major port at Dhamra, the first phase of which was to be completed by 2008 at a cost of Rs 1500 to Rs 2000 crore. As regards the aluminium project, Mr Naik said the bauxite mines for the company would be located at Kutrumali and Sijimali for which the government had given a prospective licence to the company.
— PTI
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Steel Ministry looks for partners abroad
Bangalore, September 23 Union Steel Minister Ram Vilas Paswan said equity tie-up with coking coal producers abroad was the only way to meet the coal requirements of the steel sector. The minister, while talking about the iron ore export policy, said problems had arisen with
Posco, which was mining iron ore in Orissa because the company was not fulfilling the requirements, which had been agreed upon earlier. Mr Paswan said the company wanted iron ore from certain mines to the tune of 1,000 million tonnes whereas its requirement was only 600 million tonnes. He said under the agreement with the company it had to import iron ore with high iron content to the tune of 30 per cent of its production so that it could be blended with Indian ore, which had more alumina content. He said only when this import was made could the company export iron ore.
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RIL to expand refinery capacity
New Delhi, September 23 “The expansion would be completed sometime in 2008-09 financial year,” a top company official said here today. The 33-million-tonnes-a-year capacity Jamnagar refinery currently is the single largest refinery in India and the expansion would enable the firm to remain the country’s second largest refinery after the Indian Oil Corp (IOC).
— PTI
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