New Delhi, January 17
The cabinet cleared a 50 per cent cut in the auction reserve price for Code Division Multiple Access (CDMA) spectrum on Thursday, a move which may not be enough to still attract the pure CDMA operators to bid for the airwaves in the auction slated for March.

Within hours of the move, which came at a cabinet meeting chaired by Prime Minister Manmohan Singh, the only exclusive CDMA operator in India, Sistema Shyam Teleservices Ltd (SSTL), reacted by saying price reduction was not enough.

Facing cancellation of licences due to the February order of the Supreme Court, SSTL, which has been complaining that its licences were revoked unfairly, said last November there was no bidder for CDMA. While SSTL had stayed away from the auction saying the reserve was too high to bid, two other players, Tata Telecom and Videocon, which initially showed interest and filed applications, also withdrew later citing the same reasons.

"The cabinet has approved 50% reduction in CDMA spectrum price which was fixed earlier at Rs 18,200 crore (pan India 5 MHz)," Telecom Minister Kapil Sibal said after the cabinet meeting. After 50 per cent reduction, pan India 5 MHz of 800 MHz CDMA spectrum will be priced at Rs 9,100 crore.

The Empowered Group of Ministers had earlier recommended a 50% cut in the reserve price of 800 MHz band. The government has already announced a 30% cut in the reserve price of the 1,800 MHz band spectrum used for offering GSM services, which remained unsold in the last auction.

Experts however pointed out that other players may also decide not to participate in the auctions time the time there was clarity on whether the spectrum on offer in the 800 MHz was liberalized or not. A liberalized spectrum would allow telecom operators to offer other services besides the CDMA connectivity on this frequency which is considered much more efficient than the 1800 MHz frequency which the GSM players would be using.

After today’s decision there will also be a reduction in the one-time fee that CDMA players will have to pay. At the earlier price, the total CDMA industry outgo would have been about Rs 6,000 crore but now it will be just Rs 3,033 crore.

Bangalore, January 17
India's No.4 software services provider HCL Technologies Ltd joined Infosys and Tata Consultancy in beating profit estimates, sending its shares up as much as 7 percent and adding pressure on Wipro to deliver strong results on Friday.

Investors are betting that a good showing by the top companies in India's US $100 billion-a-year outsourcing industry is an early sign of a broader pickup in IT spending. Reflecting that optimism, the country's IT services subindex has surged more than 13% in almost a week.

HCL reported a 68.4% jump in net profit for the three months ended December to Rs 9.65 billion from a year earlier. Analysts were expecting profit to rise to Rs 8.26 bn, according to Thomson Reuters data.

The company, based outside Delhi, also posted a 3% gain in the volume of IT services it provides compared with the previous quarter even as it cut headcount while Infosys Ltd and Tata Consultancy Services Ltd added staff.

An increase in work being moved offshore also helped HCL grow operating margins faster than larger rival TCS compared with the previous quarter, while margins at Infosys shrank.

"They've really exercised cost control, they've managed that exceedingly well by keeping a strong control on recruitment. Their infrastructure services business has seen margin expansion and that's a good sign as well," said Bhavin Shah, CEO of Equirus Securities.

Infrastructure refers to managing large banks of computer servers, networks and the software that powers them.

HIGHER REVENUE GUIDANCE: Shares of IT services providers have jumped since industry No.2 Infosys topped earnings forecasts and unexpectedly raised its revenue guidance, spurring hopes for a turnaround for the battered company and an uptick in demand for the broader sector. — Reuters

New Delhi/Mumbai, Jan 17
In a sign which reflected that India's largest motorcycle maker was losing its grip on the Indian market, Hero MotoCorp Ltd missed estimates for the fourth straight quarter on Thursday as Q3 net profit fell 20.4 per cent on rising costs and falling sales that battered margins.

Hero, which is investing heavily in new technology and export operations, is battling to protect its dominant market share from former partner Honda Motor Co as the overall market stalls.

"The last two quarters have been challenging for the Indian auto industry on account of the delayed monsoons, rising fuel prices and subdued sentiments," managing director Pawan Munjal said in a statement.

Hero sold 1.57 million vehicles in the October-Dec quarter, down 1% on the same period last year. Total expenses rose 5.6% during the quarter. Q3 operating margin fell to 12.59% from 15.63% in the same period in FY2012.

New Delhi, January 17
Infrastructure majors GMR and GVK are walking out of mega road contracts as they are unable to arrange funding for those projects, and not on account of delays in environment clearance or regulatory hurdles as cited in their notices, the National Highways Authority of India said Thursday.

"Basically, in our view, as to why they are walking out of these two projects is the change in the economic scenario and escalation of costs," NHAI chief R.P. Singh said. "Arranging huge private equity is a major problem (for them) as these are much bigger projects than what we earlier awarded on BOT (build, operate, transfer)," he added.

Talking to reporters on the sidelines of a FICCI event, Singh said: "A GVK project in our view requires an equity of Rs 1,500 crore. A GMR project may require an equity in the order of Rs 2,000 crore. In the present scenario, I think they are overleverged financially. For them to raise this kind of equity isn’t possible."

He added NHAI "sympathizes” with the two major players but was not ready to accept the reasons for termination of contracts as they were "not tenable."

GMR Infrastructure terminated the contract for the Rs 5,700 crore Kishangarh-Udaipur-Ahmedabad expressway with NHAI on grounds of "delays in environment clearance". GVK pulled out of the pact for the Shivpuri-Dewas expressway in Madhya Pradesh, citing "change in laws" after a Supreme Court order made environment ministry permission mandatory even for extraction of minerals in an area less than five acres.

Singh said as far as the GMR case was concerned their "notice is bad in law because they are supposed to give a three months cure period notice. If we treat this a cure period notice, we are able to fulfill all the conditions within a period of one month itself." He said the environmental nod was held up because of the forest clearance, but now the environment ministry has agreed in-principle to delink it from forest clearance resolving the whole matter.

NHAI will also ask GMR not to abandon the project and complete the contract as technically no condition was unfulfilled, Singh said. — PTI

Toronto, Ontario, January 17
BlackBerry maker Research in Motion is helping customers prepare to switch to its soon-to-be-launched BlackBerry 10 smartphones that it hopes will help it reclaim market share from rivals such as Apple Inc. RIM is betting that the new range of touchscreen and keyboard devices, set for a Jan. 30 launch, will revive its fortunes.

The company was "very enthused by the engagement and response of our customer base" to a program aimed at persuading them to adopt the BlackBerry 10 devices, Bryan Lee, senior enterprise accounts director, told Reuters on Wednesday. Indeed, whether it will be successful in clawing back market share will depend on the response from RIM's top clients, like companies and government agencies, who have long valued the strong security features that BlackBerry devices offer.

Lee said more than 1,600 customers in North America had registered for its recently launched BlackBerry 10 Ready Program and more than a thousand were actively using the program, which offers customers access to services, information and tools to ease their transition to the BlackBerry 10 and the BlackBerry Enterprise Server 10.

RIM also said its BlackBerry Enterprise Server 10, which runs the new devices on corporate networks, was in beta testing with more than 130 major government agencies and corporations in North America.

SHARES RISE: Waterloo, Ontario-based RIM, a one-time pioneer in the now ultra-competitive smartphone industry, has bled market share to Apple's iPhone and devices powered by Google's market-leading Android operating system, even among enterprise clients who once used BlackBerry devices exclusively.

Early adoption of the long-awaited BlackBerry 10 devices by government and corporate clients will help breathe new life into the struggling company, whose shares are down 90 percent from an all-time high of more than $148 in 2008. Still, shares of RIM, which fell as low as $6.22 in September, have more than doubled in value over the last four months as the BlackBerry 10 launch approaches. — Reuters

New Delhi/Helsinki, Jan 17
Nokia said Thursday it will outsource the IT function to Indian technology firms TCS and HCL Technologies, a move that will see the Finnish handset maker cutting up to 300 jobs. Nokia plans to transfer certain activities and up to 820 employees to HCL Tech and Tata Consultancy Services as part of the process, it said in a statement. The financial details were, however, not disclosed.

“Nokia outlined a range of planned changes today to streamline its IT organization. Nokia believes these changes will increase operational efficiency and reduce operating costs, creating an IT organization appropriate for Nokia’s current size and scope,” the statement said.

Nokia, which has a strong India presence including a manufacturing unit in Tamil Nadu, said it plans to reduce its “global IT organization by up to 300 employees... These are the last anticipated reductions as part of Nokia’s focused strategy announcement of June 2012”.

The company had earlier said it was slashing up to 10,000 jobs globally by the end of 2013 as part of the restructuring process. — PTI