Mumbai, February 9
Billionaire Anil Ambani's Reliance ADA Group on Wednesday blamed a sharp drop in its stocks on what it said was a series of "baseless and motivated rumors" spread by rivals, and said it had complained to the market regulator, Securities & Exchange Board of India. Shares in his group companies were bludgeoned in a late selloff despite an absence of any company specific news.

“This has been accompanied by vicious and illegal bear hammering of our listed stocks, to create panic and destabilise the markets," a group spokesperson said in an emailed statement.

It said it had asked the Securities and Exchange Board of India (SEBI) and the stock exchanges to investigate.

It did not name the companies it was accusing of spreading rumours.

Stocks are often driven by rumours, with companies controlled by the Ambani brothers, who last year called a truce in their long-running and high-profile feud, frequently the subject of unsubstantiated market talk.

Investors have been jittery in recent months as broader weakness in the stocks has been exacerbated by a series of corruption scandals embroiling the government and companies.

“We are as it is going through a phase of major crisis of confidence,” said Prakash Diwan, head of institutional business at Networth Stock Broking.

"Rumors like these add to panic and are absorbed more faster in current situation when we are facing issues like corporate governance in the industry," Diwan said.

On Wednesday, shares in DB Realty fell as much as 20% after the arrest of a telecom executive Shahid Balwa, who is also vice chairman of an Indian venture between DB Group and Abu Dhabi's Etisalat, as part of an investigation into a telecoms licence scandal.

Sensex ended about 1% lower on Wednesday.

A spokeswoman for the National Stock Exchange said it had not yet received any communication from the Reliance ADAG Group on the matter.

Officials at SEBI and the BSE could not immediately be reached for comment. Reliance Communications shares hit an all-time low of Rs 90.8 before recovering somewhat to close at Rs 94.85.

The company, which had debt of about $6.4 billion at the end of September, has seen its shares battered amid fierce competition and after it failed in efforts last year to sell a 26% stake in itself and to merge its tower unit with a rival.

In November, a government audit report said Swan Telecom, which was later renamed Etisalat DB, was given a licence despite a unit of Reliance Comm holding over 10% of equity, a violation of rules, the auditor's report said.

Reliance Comm has said the group did not have any shareholding in Swan when licences were given out in January 2008.

Last month, two Anil Ambani-controlled firms agreed with the market regulator not to invest in stocks until December 2012, while Ambani himself agreed not to invest in listed securities until the end of this year.

SEBI had said the two firms, Reliance Infrastructure and Reliance Natural Resources, which has since been merged into Reliance Power, had used money raised through overseas borrowing and foreign bonds to invest in the stock market.

Reliance Infra said at the time it had voluntarily settled the matter, with no admission or denial of guilt.

Shares in group listed companies Reliance Power, Reliance Communications, Reliance Capital, and Reliance Infrastructure ended between 8.9-18.8% lower. — Reuters

New Delhi, February 9
Environment Minister Jairam Ramesh today gave forest clearance to SAIL for mining iron ore from Chiria reserves in Jharkhand,overturning the recommendation of his Forest Advisory Committee for the second time in a month.

The approval for Steel Authority of India Ltd (SAIL), a Maharatna, was however given with 13 specific conditions.

Ramesh said that one of the factors behind the approval for the project, which was mired in several controversies, was that "Chiria is essential for the future of SAIL." Over the next 50 years, around 40 per cent of iron ore requirement of the SAIL will be met from Chiria mines.

"The approval is being given subject to the usual conditions governing forest clearance (like those relating to compensatory afforestation). There are 13 specific conditions that are being stipulated for this approval," Ramesh said.

SAIL Chairman C S Verma said he was happy the clearance and was hopeful that mining of iron ore could commence by 2012-13.

"I am very happy. Chiria Mines belong to SAIL and this nod would ensure raw material security to us. We hope to start production by 2012-13," Verma told PTI.

Ramesh said he overruled the FAC recommendation while granting clearance.

"There have been two occasions when FAC has recommended rejection and I have exercised my own judgement and overturned the FAC recommendation - the first being POSCO and the second being the present Chiria case," he said.

Ramesh last month gave clearance for South Korean major POSCO for its mega steel mill-cum-captive power plant project and a minor port in Orissa.

"The FAC will continue to focus single-mindedly on forest-related, biodiversity-related issues and concerns, while as Minister I will have to necessary to take a broader view but placing on public record in a complete manner the reasons for taking that view. That has always been and will continue to be my approach," the Minister added.

SAIL had sought permission for diversion of 595 hectares of land which is 25 per cent of the total Chiria mine area.

The permission was sought for a period of 20 years. — PTI

New Delhi, February 9
Japanese consumer durables firm Hitachi today said it plans to double its turnover to $2 billion in India by 2013 and it will set up a new research and development centre in the country by next fiscal.

Besides, the firm is looking to set up a new production facility dedicated to manufacture products, mainly more energy efficient ones for the local as well as the overseas markets.

“We have a turnover of around $1 billion in India (at present). Our plan and mission is to double it in the next couple of years. We will keep on looking for business opportunities in the country,” Hitachi Asia Chief Executive Yasunori Taga told reporters here.

The company is already in the process to set up its first research and development centre in Bangalore, which will be operational by the end of next fiscal. Besides, the company is also looking at setting up its fifth manufacturing facility in the country in order to meet the growing demands.

"Our vision is to have one R&D centre in India to address the global needs as well as to develop products for the local market... besides we also need to set up a new production site to meet the demands of the country and to have direct access to the market here," he said.

He, however, did not provide how much the company will invest to set up the R&D centre and the new production facility. At present, Hitachi has four plants which makes products like air conditioners and construction equipment.

The company, which announced its participation at the two-days Eco-Products International Fair 2011 starting from tomorrow, said it will focus on promoting its eco-friendly products in India.

It has already lined up a range of energy efficient products to be introduced for the Indian market.

"Our contribution to the global turnover is very less, around one per cent. We want to increase it.

We are very much working on the kind of energy efficient products that we can bring to India," Taga said. — PTI

Mumbai, February 9
Shahid Balwa, promoter of Swan Telecom, was taken to New Delhi in connection with the 2G scam after a Mumbai court Wednesday granted a two-day transit remand to the CBI, an official said.

Balwa, arrested in Mumbai late Tuesday by the Central Bureau of Investigation, was presented before a court Wednesday morning and was then taken to the Mumbai airport for a flight to New Delhi.

The CBI nabbed Balwa following an arrest warrant issued by a New Delhi court.

In its remand application, CBI said Balwa’s company Swan Telecom, which allegedly got favours in the spectrum allocation, had caused the national exchequer a loss of over Rs.22,000 crore.

It further said that Balwa allegedly conspired with private companies to sell 2G spectrum licences acquired at a cheap rate by Swan Telecom - part of DB Realty - to a company in the Gulf at a huge profit.

Balwa became the fourth person - and the first who is not a government official - to be arrested in connection with the scam.

Former communications minister A Raja and two of his aides are under arrest. The scam relates to irregularities in the allocation of second generation spectrum to telecom companies when Raja was the minister.

Swan Telecom is one of the companies that allegedly benefited from spectrum allocation. It was part of Mumbai-based DB Realty, which has since then become Etisalat DB.

Meanwhile, the DB Group on Wednesday said it had been "wrongly implicated" in the 2G scam.

"We reiterate that neither Balwa nor any person or entity forming part of the DB Group has done anything illegal or inappropriate," the company said stressing that he would be "strongly contesting the proceedings" against him.

Balwa was put in two-day transit remand of the Central Bureau of Investigation (CBI) by a Mumbai court Wednesday morning and taken to New Delhi for a court hearing.

The company spokesperson also clarified that these developments would not affect the functioning of DB Realty, which would continue as usual under its managing director Vinod Goenkar and that stakeholders’ interests would be protected. — Agencies

The fourth arrest in the 2G Spectrum scam and first executive from the private sector in the dock, Shahid Balwa has had an interesting life. Here’s a look at this college drop-out’s journey.

• Moved to Mumbai with his family to run a restaurant
• Became a hotelier and then partnered with Vinod Goenka to form DB (Dynamics Balwa) Realty in 2007
• Last year, he was on the Forbes list of India’s 100 richest people
• His estimated net worth was then $1 billion - the youngest billionaire on the list.
• In 2008, Balwa’s Swan Telecom bagged 2G licences for 13 of the 22 circles across India, circles that included crucial Mumbai and Delhi areas, for a paltry Rs. 1,537 crore.
• Within months it sold 45% stake to UAE-based Etisalat for Rs 4,500 crore.
• Swan is now called DB Etisalat.
• Balwa is said to be a fitness fanatic, is married and has two children. He is believed to be politically connected and close to former Telecom Minister A Raja
• Balwa was arrested from his Mumbai home on Tuesday.
• Balwa has said that he had applied for Spectrum very early on and that he was among the earliest players to bid for it.

Chandigarh, February 9
Rural customers are now the biggest growth drivers for Airtel’s digital TV. The company claims that during this year, almost 70 per cent of the growth in volumes has come from rural areas and category C towns.

Bharti Telemedia plans to have a more focused approach on its DTH (direct to home) service penetration in the rural areas. The company plans to increase its distribution width and service facilities in all rural areas, besides the Cat C towns. This will ensure that the company’s growth trajectory remains high in the coming fiscal as well.

H S Bhatia, COO, digital TV services, Airtel, said that this year, the company has added three million new subscribers, taking its total DTH subscriber base to five million. “Of the three million new subscribers that we have added, 70 per cent have come from the rural and semi urban areas. Thus, we are planning to increase our rural penetration and will soon have our distributors at 27000 small towns and villages,” he said.

Bhatia said that even as they were focusing on increase in rural penetration, they would continue to expand their distribution and service facilities in the urban areas as well. “There are 229 million households in India, of which 180 million have access to TV, 50 million have access to cable and 30 million have a DTH connection. Thus, there is a huge opportunity for DTH players to tap those homes which do not have a DTH connection. It is thus that we are coming up with innovative marketing schemes, wherein services are being provided at a discount, or as a bundle service with a new TV set,” he added.

New Delhi, February 9
GSM operators today rejected TRAI's recommendation on 2G spectrum prices saying it was like changing the goal posts in the middle of the game, while some of the new players said the proposal for additional spectrum favoured the incumbent service providers outright.

The TRAI has recommended over six-fold increase in 2G spectrum prices for the contracted 6.2 Mhz at Rs 10,972.45 crore for pan-India licence and one-time entry fee for additional one Mhz of spectrum at the rate of Rs 4,571.87 crore on all-India basis.

The Cellular Operators Association of India (COAI) termed the new recommendations of TRAI as "disastrous" for a majority of the operators.

Some of the new players, who did not wish to be identified, said this would legalise the additional spectrum hoarded by GSM players at fraction of a cost.

The contracted limit of spectrum is 6.2 Mhz and the government must seek return of additional spectrum without any delay, they said.

More over, the price of additional spectrum is just one-time entry fee, whereas it should be recurring on annual basis, the new players said.

"The TRAI's recommendations are like changing the goal posts in the middle of the game. We cannot go among subscribers and recover it," COAI Director General Rajan Mathews said.

"The assumptions used by TRAI are open to question. They (TRAI) have used very sophisticated mathematical modelling. It may take couple of weeks for us to understand but on the face of it, these look very disastrous for the industry," he added.

Bharti, BSNL, Vodafone and Idea Cellular hold extra spectrum beyond 6.2 Mhz in various circles and would have to pay hefty one-time fee for this.

The Comptroller and Auditor General (CAG) had estimated nearly Rs 37,000 crore presumptive loss to the exchequer on this account. — PTI