Mumbai, November 10
Furious passengers irked by cancellation of several flights by Kingfisher Airlines created a ruckus at the Mumbai airport for the third day today. The airline has cancelled more than 80 flights over the past few days and rescheduled several others causing inconvenience to passengers.

At the airport, passengers who were informed of the cancellations at the last minute, were trying to book seats on other airlines.

"The problem is reducing. Fewer people are booking Kingfisher Airlines flights due to the trouble," Mohammad Salim, a travel agent, told The Tribune.

Rival airlines have quickly moved in to cash in on Kingfisher's problems by raising fares.

Flights on the Mumbai-Delhi sector more than doubled to Rs 20,000 during the peak evening hours. The usual fare between the two cities is Rs 7,500. Similar increases have been reported on the Mumbai-Bangalore sector as well.

Reports said the Directorate General of Civil Aviation is sending a show-cause notice to the Kingfisher Airlines management. The agency is also expected to look into the sudden increase in fares by rival airlines.

Kingfisher is the country’s second largest airline with a 20 per cent market share and operates 325 daily flights. In a statement, the airline said it was cancelling 32 flights a day till November 19 in order to configure its aircraft. However, the number of cancellations are higher across the country, according to the travel trade.

The cash-strapped airline which has had problems paying salaries and its fuel bills is suspending its low-fare operations in order to reduce losses.

Meanwhile, more than 100 pilots of the airline have put in their papers as they were not paid salaries for the month of October, according to sources.

New Delhi, November 10
When Kingfisher Airlines promoter Vijay Mallya decided to fly out of the low-cost aviation space, aviation experts evaluated it as a good strategy to salvage the debt-ridden airlines. The decision to shift focus to full-service operations does not appear to have helped the Airlines much, struggling as it is to foot fuel, staff and airport services bills.

Kingfisher passengers continued to face a tough time with the Airlines cancelling flights, forcing them to either cancel trips or book tickets in other airlines at higher prices. The carrier is understood to have cancelled over 30 flights for the fourth consecutive day today as cockpit and cabin crew failed to join duty, reporting sick.

Over the past four days, the Mallya-owned airline has cancelled over 120 flights. The latest indication of the airlines’ growing financial miseries are reports emerging from Paris that suggest that Mallya is all set to cancel orders for two A-340 aircraft.

Civil aviation regulator DGCA has sent Kingfisher a notice over the sudden cancellations. Kingfisher is yet to send an official reply to the DGCA show-cause notice as to why it had not taken the regulator’s prior approval to curtail its flight schedules as required by the Aircraft Rules, 1937.

It has been claiming that flights were cancelled as the company was trying to reconfigure its aircraft but the DGCA is categorical that under Rule 140 (a), prior approval is required before cancelling or rescheduling flights.

Passengers have complained that they were not intimated about the Kingfisher cancellations and they had to rebook themselves on other airlines, ending up paying up to 20 per cent more. The DGCA has also asked the beleaguered private carrier how it plans to compensate the affected passengers.

Sources say around 100 Kingfisher pilots have submitted their resignations and the reason behind the exit is that they are yet to get their salary for October. Kingfisher is reported to have suffered a loss of Rs 1027 crore in 2010-11.

Reeling under a debt of a staggering Rs 7,000 crore, financial experts say Kingfisher immediately needs Rs 3000-4000 crore to get back on its feet.

Oil companies like HPCL, IOC and BPCL have put Kingfisher on cash-and-carry basis as the airline owes them crores in dues.

Sources say ATF supplies were stopped by state-run HPCL as the airline owes it about Rs 600 crore. BPCL is also not supplying fuel, following an ongoing court case over alleged non-payment of about Rs 250 crore dues. The IOC too stopped giving ATF on credit and has put the airline on a cash-and-carry mode. It now appears that airport operators are also contemplating putting the airline on the same mode for services provided at airports.

Mallya is understood to have conveyed the shaky state of his airlines’ finances to Finance and Civil Aviation ministries, arguing that losses will only multiply unless fares are hiked. Experts however say that any fare hike by Kingfisher will only work to the benefit of low-cost carriers like IndiGo and Spicejet.

New Delhi, November 10
The slowdown in the Indian automotive market has resulted in its first major casualty, with the country's second largest car-maker Hyundai Motor shelving a plan to set up a diesel engine manufacturing plant at an investment of Rs 400 crore.

The wholly-owned Indian subsidiary of the Korean auto giant, which has witnessed a sustained decline in sales over the past couple of months, cited sluggish demand as the reason for putting the project on the backburner for the time being.

When contacted, a Hyundai Motor India Ltd (HMIL) spokesperson said: "Given the fact that the market is not buoyant at the moment, our diesel engine plant plans are on hold at the moment." While he did not provide details on how long the company will shelve the plan, the spokesperson said it would at least be for the "medium term".

Nevertheless, "Having invested $2 billion in India (so far), we can only move forward and stay committed to this market," he said. While the location of the diesel engine plant had not been announced, HMIL Managing Director and CEO Han Woo Park said in December, 2010, that the firm would invest Rs 400 crore over three years to set up an engine plant with an installed capacity of 1.5 lakh units per annum.

The company had planned to utilise engines manufactured at the plant in its new models and only a few would have been used for replacing the existing models.

At present, the company imports diesel engines from Korea for its models such as 'i20' and 'Verna'. HMIL has an installed capacity to produce 6.7 lakh vehicles per annum. — PTI

New Delhi, November 10
Batting for the sugar industry, Agriculture Minister Sharad Pawar yesterday advised the government to enter the export market in a big way and capitalise on higher global rates.

“There is surplus sugar. This is a golden time for India to enter the global market in a big way and get a better price, which will ultimately be provided to cane-growers,” the Agriculture Minister said on the sidelines of the international conference on “Innovative Approaches for Agriculture Knowledge Management System: Global Extension Experiences”.

With projections of surplus sugar production this marketing year, sugar production in the country - the world's second-largest sugar producer and biggest consumer - is estimated at 25-26 million tonnes in the 2011-12 marketing year (October-September) as against the annual domestic demand of about 22 MT.

The government, however, is yet to announce the export policy for the current marketing year.

So far the country has exported 2.6 million tonnes in the previous marketing year, of which 1.5 MT was through Open General Licences (OGL), in three equal tranches.

There are indications that the government may work out a scheme for export of a certain quantity of sugar, which will be favourable to both the industry and farmers, next week.

Yesterday, Food Minister K V Thomas had said that EGoM on Food, headed by Finance Minister Pranab Mukherjee, might meet on November 16-17 to decide on allowing sugar exports this marketing year.

Sugar industry body ISMA has been demanding the export of 4 MT of sugar this marketing year to help mills improve their cash flows. At the current global price of about $ 670-680 per tonne, sugar mills will earn a premium of Rs 3.5 per kg from exports of the sweetener vis-à-vis domestic rates if the government allows overseas shipments.

New Delhi, November 10
In times when big-ticket airlines are finding it difficult to stay afloat, private air carrier Karina Airlines International today said it had received permission from the government to operate scheduled flights in smaller cities in northern India.

The Civil Aviation Ministry has granted an initial “No Objection Certificate” (NOC) for Scheduled Airlines Operations (Regional) to the company, which has been operating a non-scheduled airline service for three years now, the airline said today.

The airline’s promoters believe that regional aviation holds an important opportunity for growth of the sector in tier II and III cities.

“We understand that there is a great demand for point-to-point connections in smaller cities. Karina will be a full-service airline targeting business and tourist passengers,” Managing Director Namrata Chawala said.

Karina Airlines said it would initially concentrate on the northern region, mainly the states of Uttarakhand, UP, Rajasthan, MP and Himachal.

The airlines would be entitled to the benefit of sales tax exemption on fuel uplift and waiver of landing and parking charges for its regional operations.

New Delhi, November 10
Bharti Airtel today announced that it has tied up with Ericsson - the world's largest mobile telecommunications equipment vendor, to upgrade an initial batch of 250 diesel-powered base stations in Nigeria with E-site, a new "green" energy solution which would improve its operations in the country and minimise its environmental impact.

Airtel has its operations in 19 countries across Asia and Africa. The award winning E-site solution will enable Airtel harness solar energy to power mobile base stations across Nigeria.

The solution has been tested by Airtel in Kenya for close to two years and has proven to substantially reduce diesel consumption and CO2 emissions when compared to a 24/7 diesel-powered site.

Manoj Kohli, CEO (International) and Joint Managing Director, Bharti Airtel, said, "We are happy to take the lead in deploying and rolling out state-of-the-art green power solutions and reducing our dependency on diesel.

This latest initiative will not only enable us to significantly reduce operating costs but also contribute to the reduction in the greenhouse effect.

Going forward, we aim to introduce and take forward this green and efficient initiative in the rest of our operations.”

The E-site is mainly powered by renewable energy sources (sun and wind) and uses a battery bank for storage of energy. The wind turbines have been modified and perfected for this particular purpose.

Under the agreement, Ericsson will be responsible for implementation and maintenance services for all the sites.

Lars Linden, Head of Ericsson, Region sub-Saharan Africa said, "We are driving the implementation of this innovative solution in support of sustainability and the development of the networked society.

The new green and highly cost-efficient base station solution makes not only environmental sense, but also financial sense for our customers enabling the efficient deployment of services to previously un-served or underserved areas.”

New Delhi, November 10
US-based retailer Walmart is setting up a research centre in India to develop technologies and solutions for its global e-commerce business.

The company, which already has an R&D centre in the Silicon Valley, is setting up another ‘WalmartLabs’ facility in Bangalore, with plans to hire up to 100 developers here.

“At the centre in Bangalore, we will hire 100 developers and cater to Walmart's global e-commerce business,” Walmart Global e-Commerce senior VP Anand Rajaraman said.

He said the centre was expected to be up and running by the end of this year, but declined to provide the investment details.

“We are currently recruiting developers who have deep knowledge and expertise in the areas of machine learning, social analytics and big data infrastructure,” he said.

The team will lead and own projects to bring new e-commerce, social and mobile commerce offerings to the global marketplace, he added.

“Globally, Walmart has e-commerce businesses in a host of countries, including the US. However, online shopping option is not available to consumers in India yet,” he said.

In India, Walmart operates 13 wholesale cash-and-carry stores in India in partnership with Bharti Enterprises. — PTI

New Delhi, November 10
The stress assets in the Indian banking system may rise in the next two years with a rising share of loans to over-leveraged companies which are vulnerable to an economic slowdown, according to a research report by Credit Suisse. The report says that strong growth in corporate loans at 26 per cent CAGR over the past six years has created some significant pockets of over-leverage which is vulnerable to a slowdown.

It says that 30 per cent of the loans in the financial and banking sector are to over-leveraged companies. As much as 12 per cent of loans are to highly over-leveraged companies where the debt is very high and going forward, a combination of slowing economic growth and high interest rates is likely to increase stress on these portfolios.

The report expects the bank stress assets to increase to over 8 per cent of loans in the next two years from the current 4-6 per cent led by the restructuring of 3-4 per cent loans. It says risk is getting concentrated in select sectors and a large quantum of restructuring will be driven by sectors such as power, micro-finance, airlines, textile and commercial real estate.

In the power sector alone, it expects restructuring to the tune of $25 billion which is 30 per cent of sector loans by financial year 2015 as leverage for infra developers could rise to unsustainable levels.

The flow of resources to various sectors has also not been uniform with 48 per cent of incremental credit to the industry since 2005 going to three sectors - infrastructure, metals and real estate.

With the gearing of stressed corporate high, restructuring without additional equity or debt haircut by lenders is unlikely to be a viable solution. Indian banks have already been witnessing a rise in NPAs from the agriculture and SME segments over the past few quarters.

There will be huge capital raising by the Indian banks, the report says as Tier 1 capital of most banks is thin at 7-9 per cent. It expects 70 per cent of the sector to raise $14 billion in the next two years. Potential asset quality slippage can exacerbate the capital needs further to $22-27 billion if NPAs rise 2-3 per cent as provision cover is thin. 

Chandigarh, November 10
The anomalies in deposits and payment of pension, following the implementation of the new pay commission, besides unwillingness on part of banks to exchange soiled currency notes, comprised maximum number of complaints received by the banking ombudsman office in the Chandigarh region.

Data released by the banking ombudsman, J.Tashi, for the states of Punjab, Himachal Pradesh, Chandigarh, Panchkula, Ambala and Yamunanagar districts of Haryana, showed that the banking ombudsman office in this region was gaining acceptance amongst consumers for redressal of their complaints. The total number of complaints have gone up by 7.3 per cent since last year (3,559 complaints received between July 2010 and June 2011, as compared to 3,317 received in the corresponding period previous year).

A large number of rural consumers, too, have started approaching the banking ombudsman, with complaints against various banks. As many as 477 complaints received this year were from rural customers (up by seven per cent) and 652 were from semi-urban customers (up by 10.5 per cent). “The maximum complaints received this year were against SBI and State Bank of Patiala, mainly because they have the largest presence in the region. Over 32 per cent of complaints received were against SBI and its associate banks alone, followed by 32.4 per cent complaints against other public sector banks, 25.8 per cent against private sector banks and 3.8 per cent against foreign banks,” said the banking ombudsman adding that complaints against the public sector banks were mainly related to payment of pension and ATM frauds, while complaints against private banks were mainly related to credit card payments.

Tashi said one of the major achievements this year was the issuance of awards for fraudulent ATM transactions. These related to cases of ATM cloning that had come to rock Chandigarh, Panchkula and Ambala last year. After cross checking all facts, the banking ombudsman has asked the bank concerned, SBI in most cases, to reimburse the money back to the customers whose ATM card was cloned and cash withdrawn using the cloned ATM cards. “We have issued awards in 26 such cases,” said the ombudsman.

Mumbai, November 10
Aditya Birla Group firm Hindalco Industries today reported a growth of 15.84 per cent in net profit to Rs 502.52 crore for the quarter ended September 30, 2011, on the back of higher realisation from its aluminium and copper businesses.

The company had reported a net profit of Rs 433.81 crore for the corresponding quarter last fiscal.