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ADAE to merge group entities
Govt offers single-window service for mega corporates
SAIL plans joint venture with Coal India
IOC to sell stake in ONGC, GAIL
Telecom PSUs’ jv on ILD by March
Mittal Steel eyes 49 pc stake in Chinese firm
Relaunch of Sandesh on January 1
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Bank Account
Govt firm on SEZ at Amritsar
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ADAE to merge group entities
Mumbai, December 28 The Boards of Reliance Capital and Reliance Energy will meet on January 2 and 3, respectively, to consider the merger of Reliance Capital Ventures Ltd and Reliance Energy Ventures Ltd with them, RCL and REL informed stock exchanges. This merger is being done as part of efforts to enable RIL’s shareholders to have a direct stake in the two listed entities of the Anil Ambani group instead of routing through the new special purpose vehicles that are being created to effect the settlement between him and elder brother Mukesh, sources in the know of the development said. Reliance Energy Ventures, Reliance Capital Ventures, Reliance Communications Ventures and Global Fuel Management Services Ltd were the four companies that were created after the demerger of Mukesh Ambani-controlled Reliance Industries. Before any merger, the four new entities would be listed on stock exchanges by March next year. The ADAE is considering applying to SEBI and stock exchanges to list the shares of four companies in bourses without making a public offer. Special trading
session on Jan 18 The two premier stock exchanges — BSE and NSE — will hold a special trading session on January 18 to help investors ascertain the value of shares in Reliance Industries Ltd (RIL) post demerger. The stock exchanges’ decision follows the announcement of January 18 as the effective date to split Reliance group assets in a corporate restructuring at the core of the settlement of a feud between the two Ambani brothers — Mukesh and Anil. “RIL is an actively traded scrip on the exchanges with a market capitalisation of more than Rs 1,200 billion ($26.52 billion) and accounts for approximately 9.04 per cent in the Nifty (the NSE’s top 50-share index),” the NSE said in a press note on its website. The NSE release said the demerger of Reliance would change the company’s market capitalisation and also impact market indices and base market capitalisation. “In consultation with (the stock market regulator), BSE and NSE have jointly decided that a special one-hour trading session shall be held...to facilitate discovery of the post demerger price of RIL,” said the press note. The session will be held from 8 am with only Reliance shares allowed to trade and no circuit filters applied. Last week, the NSE had postponed trade in Reliance derivatives until January 18, when the spin-off takes effect. Meanwhile, a group of investors led by Bhumika Trading Pvt Ltd today proposed to buy a little over 1.94 lakh shares of Reliance Industries from Akshar Traders Pvt Ltd to hike their stake in the Mukesh Ambani-controlled firm to 10.07 per cent.
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Govt offers single-window service for mega corporates
New Delhi, December 28 "Taxes must be paid. I don't believe in blunt measures like search and seizures. Sometimes, we have to use blunt instruments," said Finance Minister P. Chidambaram while flagging off the roadshow for Large Taxpayers Unit (LTU) here today. Mr Chidambaram invited 582 top corporates to avail a single-window tax payment facility and promised to set up a National Tax Tribunal next year to cut disputes and improve collections. Corporates can confirm their participation in the LTUs by January 10, so that the tax departments could assess the taxes from next fiscal. "I promise you that the LTUs will be modern offices and assessment and payment will be through electronic system. Senior officials will assist you," he said. Initially, the government would offer single-window service in five cities, including Delhi, Mumbai, Chennai, Bangalore and Kolkata. However, it would be optional for the companies paying excise over Rs 5 crore to avail of the service of filing excise, corporate tax and service tax under one roof. Mr Chidambaram said geographical reach and eligibility criteria could be extended. Of the 582 large corporate tax payers, 145 can avail the LTU facility in Delhi, 196 in Mumbai, 101 in Kolkata, 84 in Chennai and 56 in Bangalore. The minister said a bill for setting up a National Tax Tribunal was introduced in the winter session and is now with the Standing Committee of Finance and is expected to be taken up in the Budget session. IMD redemption today On the issue of redemption of India Millennium Deposits (IMD) of $ 7.3 billion by NRIs, Mr Chidambaram indicated that there would be no problem in the liquidity situation. "We have enough liquidity. So there is no problem" he said. The State Bank of India will start repaying NRI depositors about $ 7.3 billion from tomorrow, the day when its IMD matures. Several banks, including the SBI, ICICI Bank, IDBI Bank, Bank of Baroda, Union Bank of India and Centurion Bank of Punjab along with insurance major Life Insurance Corporation of India are planning to tap a significant chunk of the IMD redemption. IMD redemption along with high credit demand have put pressure on the liquidity situation as it is reflected in the sudden spurt in overnight call money rate to 7 per cent, well above the RBI’s reverse repo rate of 5.25 per cent. Mr Chidambaram, however, dispelled fears that there will be pressure on other short-term rates as well. On borrowing, he said the government will go ahead with its market borrowing schedule for January when the Centre is slated to mop up Rs 10,000 crore between January 3-11. The government is slated to borrow Rs 58,000 crore from the market in the second half of 2005-06.
Redemption may hit retail loan segment, says
The Reserve Bank of India (RBI) has sold $5.107 billion to the State Bank of India (SBI), the country’s largest bank, for the redemption of India Millenium Deposits (IMD), due tomorrow.
The central bank will sell the remaining $1.972 billion tomorrow. The total outgo from foreign exchange reserves for the redemption will be $7.079 billion, a RBI statement here said. Marketmen said that tomorrow’s redemption of $7.3 billion is expected to squeeze liquidity, which is already tight due to outflows of about Rs 200 billion towards advance tax payments. RBI had earlier said that it would release the money for the redemption from its foreign exchange reserves to the SBI, but the State Bank must provide Rupee funds of nearly Rs 330 billion in return. Meanwhile, SBI Managing Director Ashok Kini said that there would not be any pressure on liquidity availability due to IMD redemption since both the authority and SBI have prepared themselves to meet the demands from the IMD holders. However, he felt that there would be some pressure on retail loan segment where interest rates need to be aligned with the trend of the industry.
— UNI
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SAIL plans joint venture with Coal India
Kolkata, December 28 Talking to newspersons here today, a day after his meeting with CIL Chairman in New Delhi, SAIL Chairman V.S. Jain said in view of the necessity of augmenting supply of indigenous coking coal they had decided to jointly develop at least three iron ore mines including the Munidih, Kapuria and CM16 with an estimated investment of nearly Rs 400 crore within the next one year. “Moreover, we have explored the possibility of acquiring a number of mines abroad particularly in Australia, Russia and Poland,” Mr Jain said and informed that a number of official delegations had already visited these countries to identify suitable mines and do the necessary groundwork. Asked how the development and upgradation of Indian coking coal mines would help boost production of SAIL, Mr Jain said it would be to the tune of about eight million tonnes in phased manner. SAIL was also in touch with the government of Chhattisgarh in order to acquire at least two iron ore mines — Cheria and Raoghat — for the same purpose and talks
were at an advanced stage, Mr Jain informed. Referring to SAIL’s overall corporate plan till 2011-12 when the production capacity in Durgapur, Bhilai and Rourkela plants besides the newly-merged ISSCO in Burnpur would be increased from about 13.3 million tonnes (of saleable steel) to at least 20 million tonnes, he said during the period investment of Rs 34,000 was also envisaged. This include Rs 8,000 crore as the cost of much talked about merger, upgradation and modernisation of Indian Iron and Steel Company Limited (IISCO) of Burnpur in West Bengal with SAIL, Mr Jain said. “With the approval of the SAIL Board of Directors already coming, the entire process of merger would take about two to three months to complete,” the Chairman emphasised to a related query. SAIL is poised to achieve the best-ever performance during the current fiscal with the overall steel production touching 10.3 million tonnes by November 2005. As the annual target of the production of saleable steel by SAIL had been fixed at 13.5 million tonnes by March 2006 before reaching the 20 million tonnes target by 2012, the present growth of 8 per cent in production was in tune with the company’s five- year long corporate plan.
— UNI
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IOC to sell stake in ONGC, GAIL
Mumbai, December 28 State-run IndianOil has a 9.61 per cent in exploration firm ONGC and 4.83 per cent in state-run natural gas transporter GAIL. India’s top state-run energy companies have held stakes in each other since 1999, when the government sold off parts of its holdings. IndianOil said earlier in December it planned to sell a quarter of its stake in ONGC by March. The proposal is now subject to government clearance. Separately, IndianOil’s board also revised the existing swap ratio for its merger with oil retailer IBP Ltd. to 110 shares of IndianOil for every 100 held in IBP. Last year, the board had approved a swap ratio of 125 for every 100 shares held in IBP. IOC holds about 53 per cent in the oil retailer. Shares in Indian Oil and IBP closed higher in a weak Mumbai market on Wednesday.
— Reuters
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Telecom PSUs’ jv on ILD by March
New Delhi, December 28 Even as the exact shape of the proposed JV is still being worked out, sources said it would be a 50:50 venture between the two PSUs and will be finalised before March 2006. As of now, the PSUs are using the infrastructure provided by VSNL, Reliance and Bharti to route their international traffic. BSNL already has an ILD licence, but is yet to start operations on its own, whereas MTNL is yet to get an ILD licence. The new entity would undertake activities such as issuing of tenders, awarding of contracts, operation of the undersea cables, among others. As part of the move, the PSUs are also looking forward to have their own infrastructure and foray into the ILD call market, which is worth Rs 4,200 crore. BSNL has already charted out its plans to enter the ILD sector by the next year.
— PTI
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Mittal Steel eyes 49 pc stake in Chinese firm
Shanghai, December 28 Analysts say the timing of the proposed deal is particularly good for Mittal Steel Co., as overcapacity racked up through years of frenzied investment has hammered domestic steel prices and could have made acquisition targets cheaper. And it could apply pressure on smaller rival Arcelor S.A., which is locked in negotiations to try and buy a chunk of Laiwu Steel Corp. Ltd., a mid-sized mill in eastern China. “The move could also help speed up the Arcelor and Laiwu negotiations, as foreign giants are eager to get a head start,” said Liang Mingchao, an analyst with Tianxiang Investment Consulting. Luxembourg-based Arcelor, the world’s number-two steel firm, is said to be close to a deal to buy into Laiwu, which is based in Shandong province. If it goes through, Mittal’s latest deal would be its second major investment in a Chinese mill. Baotou, a mid-sized mill based in the eponymous Inner Mongolian industrial city, has annual capacity for 7 million tonnes of steel and is targeting 8.5 million tonnes next year and 10 million tonnes by 2007. “Mittal wants 49 per cent of Baotou, but we haven’t reached any agreement on that,” an executive with Baotou said on condition of anonymity. Mittal this year took 36.7 per cent of Hunan Valin Steel Tube & Wire Co. Ltd., the listed arm of China’s eighth-largest mill, for about $310 million — a price that equated to the firm’s book value. Unlisted, state-owned Baotou had assets of 35.1 billion yuan ($4.35 billion) as of the end of 2004 and recorded sales of 21.5 billion yuan in 2004, according to its
website,www.btsteel.com. — Reuters
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Relaunch of Sandesh on January 1
Chandigarh, December 28 Editor and CMD of The Sandesh Limited Falgunbhai Patel is optimistic of scaling new heights after the relaunch. Explaining the need for relaunching, he says we need to move with the time to cater to the needs of new generation. It has launched a massive outdoor advertising campaign in Ahmedabad, Baroda, Surat and Rajkot. A grand event to mark and celebrate the launch is also planned in these cities. The relaunch happens after an eventful career graph spanning over eight decades in journalism. It is simultaneously being published from Ahmedabad, Baroda, Surat, Rajkot and Bhavnagar which enables it to cover the entire state.
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Bank Account
New Delhi, December 28 ICICI Bank sold 22.5 lakh shares of Federal Bank at a price of Rs 170.41 per share, while another 9 lakh shares were offloaded at Rs 176 each, as per BSE data on block deals. The country’s second largest lender mopped up Rs 51.29 crore by selling the shares of Federal Bank. Leading FII Goldman Sachs bought 20 lakh shares at Rs 170.25 a share while Kuroto Fund lapped up 9.8 lakh shares at Rs 175.90, BSE data shows.
Loan for tractors
New Holland Tractors (India), part of CNH Global NV, a global player in tractors and farm machinery, today announced all-India tie-up with the Indian Bank to offer convenient and attractive loan schemes on tractors for farmers. Under the scheme farmers can avail loan up to Rs 5 lakh at 11.50 per cent rate of interest through 1377 branches of bank across the country. Announcing the scheme, Mr. Ajay Aneja, DGM Marketing, New Holland Tractors India said, “The tie-up with Indian Bank will offer hosts of benefits to Indian farmers in terms of providing simple, hassle free and cheaper loan.” Special sales promotional activities would be undertaken by both New Holland Tractors and Indian Bank to promote the scheme. Under the scheme, the margin money for the loan will be 5 per cent if value of collateral security is at least equal to loan amount and 10 per cent for others. The bank will also waive off processing charges for the loan.
No-frills account
The Bank of India (BoI) today launched its no-frills basic savings account with simplified terms and minimum balance at all their branches across the country. Individuals would be able to open with a minimum balance of Rs 50 at rural and semi-urban branches and
Rs 100 in urban and metro branches fulfilling simplified customer identification norms enumerated by the Reserve Bank of India. Withdrawals are facilitated through ATMs in urban and metro centres where an account holder will be issued a free ATM-cum-debit card. In rural and semi-urban centres, across the counter withdrawals would be allowed twice a month. The account will have no chequebook facility, and there would no levy of penal charges in case minimum balance is not maintained. Interest would be paid on a half yearly basis at the rate of 3.50 per cent per annum on the balances exceeding the minimum balance reckoned monthly.
Term deposit campaign
Karur Vysya Bank has announced a special one-month campaign, offering an additional 0.5 per cent interest on term deposits. During the campaign period, beginning on January 1, 2006, the one year to three year term deposits of individuals and non-profit organisations would attract 7 per cent interest. The regular rate was 6.5 per cent for 1-3 year term deposits, the bank said in a statement issued here. In addition, the bank has also announced an additional rate of 0.25 per cent for single value deposits of Rs 15 lakh to Rs 50 lakh in the time bucket of 91 days to one year.
Bajaj Auto tie up
Bajaj Auto today said it has tied up with the Union Bank of India for offering two-wheeler finance. The country’s second-biggest bike maker said the tie-up will enable customers to avail 100 per cent finance on road cost of vehicle at 9 per cent rate of interest with repayment tenure between and one to five years.
Western Union pact
The State Bank of India (SBI) has tied up with Western Union’s authorised agent Kouni Travels to provide inbound money transfer
services in India. Initially, the SBI would roll out the services in 200 branches in Punjab, Himachal Pradesh, Jammu
& Kashmir, Andhra Pradesh, Karnataka and Kerala, SBI Managing Director Ashok Kini told reporters here, as he announced the
tie-up. The bank, he said, would foray into the other states of the country based on
the ‘experience’ of the initiative. In 2004, inbound remittance to India was pegged at $24 billion, he said.
— TNS, Agencies
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Govt firm on SEZ at Amritsar
Amritsar, December 28 Talking to The Tribune here on Monday, the Chief Secretary, Mr Jai Singh Gill, said the government had already shortlisted real estate developer DLF, who were in the process of working out modalities to make SEZ a reality. Mr Gill pointed out that the government was ironing out procedural problems and glitches to implement the project in letter and in spirit. He informed that DLF was at present doing the spadework to purchase land in the vicinity of the city. He said the government had also made an offer to the company to help them acquire land for residential colonies to compensate for the development of the industrial SEZ.
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