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Monday, November 22, 1999
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Another family & rule?
NEW DELHI, Nov 21 — Sonia Gandhi, today poked the industry for the “one family rule” in all the three apex bodies. "...I am told that members of one family are at the helm of affairs in all the three apex organisations. Could this perhaps lead to closer cooperation," she said at the 72nd annual general meeting of FICCI here.
Sonia Gandhi having a word with FICCI outgoing President Sudhir Jalan while incoming President G.P. Goenka looks on at the 72nd annual session of FICCI in New Delhi on Sunday.
Sonia Gandhi having a word with FICCI outgoing President Sudhir Jalan while incoming President G.P. Goenka looks on at the 72nd annual session of FICCI in New Delhi on Sunday. — PTI
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War over GAIL hots up
NEW DELHI, Nov 21 — The war of words between P Chidambaram and Yashwant Sinha over disinvestment of Gas Authority of India continued with the Tamil Manila Congress leader today reiterating his charge that the Government was following a policy of disinvestment “at any price”.

Daewoo car sales rise
CHANDIGARH, Nov 21 — Daewoo Motors India Ltd has reported a rise in the sales of its cars for October, 1999, at 3,259 units with the launch of additional variants of Matiz and the introduction of Nexia, according to company sources.

Reader insurance ‘not unfair’
NEW DELHI, Nov 21 — The Monopolies and Restrictive Trade Practices Commission has ruled that free insurance cover to subscribers offered by newspapers cannot be held as an “unfair trade practice.”

SG introduces Profile Series
CHANDIGARH, Nov 21 — Sanspareils Greenlands, India’s largest manufacturer of cricket bats, has launched range of cricket bats — the Profile Series.

Grape vine


Company notes
 

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Another family & rule?

NEW DELHI, Nov 21 (PTI) — Sonia Gandhi, who had fended off questions about dynasty rule in her Congress party many times in the past, today poked the industry for the “one family rule” in all the three apex bodies.

“...I am told that members of one family are at the helm of affairs in all the three apex organisations. Could this perhaps lead to closer cooperation and collaboration among Indian industry”, she said at the 72nd annual general meeting of FICCI here.

FICCI President Sudhir Jalan and CII President Rahul Bajaj are related as Jalan’s cousin is married to Rahul’s brother Shishir Bajaj.

Shekhar Bajaj, alternate President of Assocham, is Rahul Bajaj’s cousin.

Jalan himself underplayed the significance of the relationship saying “anyway I’ll be stepping down today.”

Interestingly, G P Goenka, who will take over as FICCI President tomorrow, is also a cousin of Jalan.

Estranged relations: Sonia Gandhi took a dig at FICCI saying relations between the Chamber and the Congress had become estranged in recent years but hoped it would be restored soon.

“It (FICCI) has enjoyed a close and intimate relationship with the Congress, a relationship that, in recent years, may have become somewhat estranged but that I hope will be restored sooner than later.”

Her comments came immediately after lavish praises were showered on her by the outgoing FICCI President Sudhir Jalan, who said that Sonia kept her promise a year ago to address her first business meeting at the FICCI forum.

There was, however, no response from FICCI President elect G P Goenka, who proposed the vote of thanks, did not comment on “estranged relations”.

Commenting on the “friendly rivalry” among industry associations, she said: “but I am told that members of one family are at the helm of affairs in all the three apex organisations (FICCI, CII, Assocham).Top



 

War over GAIL hots up

NEW DELHI, Nov 21 (PTI) — The war of words between P Chidambaram and Yashwant Sinha over disinvestment of Gas Authority of India continued with the Tamil Manila Congress leader today reiterating his charge that the Government was following a policy of disinvestment “at any price”.

Responding to Yashwant Sinha’s statement that GAIL’s GDR issued was done in a transparent manner and the Government had followed the prescribed procedures in toto, Chidambaram said Sinha had chosen not to answer why the issue was sold at a discount.

Stating that he was “disappointed both by the content and intemperate language of the response” from Sinha, Chidambaram said the questions that have to be answered were “at what level in the Government was the decision to disinvest at Rs 70 per share taken and what was the compelling need to sell in the overseas market at Rs 70 per share when the domestic price on the previous day was Rs 79.80.”

“I support disinvestment and the reform of the public sector, but the off-the-cuff remarks of ministers, non-transparent decision and the distress signals emanating from the Government have raised serious questions about the disinvestment process,” he said in a statement here.

Chidambaram wondered why the GAIL offer could fetch only Rs 70 per share when the Government was claiming that the capital market was “booming and international confidence in India had increased”.

He also defended the UF Government’s decision to disinvest in MTNL in 1997 saying that issue was priced at premium over the domestic prices despite the fact the Congress had withdrawn support to the Gujral government before the issue was closed.Top



 

Daewoo car sales rise
Tribune News Service

CHANDIGARH, Nov 21 — Daewoo Motors India Ltd has reported a rise in the sales of its cars for October, 1999, at 3,259 units with the launch of additional variants of Matiz and the introduction of Nexia, according to company sources.

In September Daewoo sold 3,166 cars, which also include 300 Matiz cars exported to Egypt. Compared with last month’s domestic sales, Daewoo has registered an increase of 13.71 per cent in October.

The total number of Daewoo cars sold between April and October 1999 stands at 17,927 units against 4,357 cars sold during the same period in 1998.

Matiz, which has completed one year in India, has evoked a good response resulting in overall sales of 17,500 cars since its launch in November,1998.

Managing Director S.G. Awasthi attributes the rise in sales partly to the two-year warranty scheme announced recently.

The J.D. Power report has rated Matiz as the best quality car in the small segment of the Indian automobile industry.

Daewoo currently produces around 120 cars per day on an average. That limits the supply of cars. The company is soon going to get into the second shift of manufacturing. With this, the waiting period of the cars will then be reduced.

The company has announced a Matiz Ist anniversary celebrations contest to involve customers by inviting suggestions towards improvisations as well as feedback on satisfaction levels with Daewoo’s current product range.Top



 

Reader insurance ‘not unfair’

NEW DELHI, Nov 21 (PTI) — The Monopolies and Restrictive Trade Practices Commission (MRTPC) has ruled that free insurance cover to subscribers offered by newspapers cannot be held as an “unfair trade practice.”

Closing an enquiry against three Malayalam dailies — Malayala Manorama, Mathrubhoomi and Kerala Kaumudi — ordered earlier by the commission, a two-member MRTPC Bench said “while it is true that the scheme has resulted in increasing the circulation of the newspapers in question, mere offer of an insurance cover to the subscribers free of charge cannot be held to be an unfair trade practice.”

The enquiry was ordered by the MRTPC based on a complaint by Malayalam monthly Noothanam that these dailies were indulging in unfair trade practices by offering an insurance scheme to boost sales.

A preliminary investigation report by the Director General (Investigation and Registration) of the MRTPC had also suggested that the scheme was in the nature of “an allurement of additional benefits” and was an unfair trade practice.

As per the scheme, Malayala Manorama and Mathrubhoomi offered an insurance cover of Rs 1 lakh to the subscribers if they die in an accident during the period of the scheme, while Kerala Kaumudi offered an insurance amount of Rs 2 lakh.Top



 

SG introduces Profile Series
Tribune News Service

CHANDIGARH, Nov 21 — Sanspareils Greenlands, India’s largest manufacturer of cricket bats, has launched range of cricket bats — the Profile Series. The Profile Series is available in three models — Profile 2000, Profile 1000 and Profile 500. Made of willow imported from England, incorporating intelligent weight redistribution, the bats comprise an enhanced ridged back with profiled tapering edges behind the ‘sweet-spot’.

Combined with the aerodynmically styled tapered profile system , and the curved blade, the bat generates awesome power and pickup without the feel of the extra weight. The non-slip rubber grip ensures better control and comfort. A nine-piece imported cane with a new oval shaped handle provides maximum shock absorption, alongwith good ball rebound, and jerk-free performance.Top


 
Company notes

Bata set for higher sales despite lockout

NEW DELHI, Nov 21 (PTI) — Bata India on Sunday said it would report a higher turnover during 1999 and would not be affected by the eight-month closure of its Faridabad unit.“The unit, which was reopened early this month, produces only a small amount of Bata’s total production and will hardly affect the company’s performance this year,” MJZ Mowla, Senior Vice-President of Bata India, told PTI.

Moreover, the Faridabad unit was catering only to lower-end products like canvas shoes and hawai chappals, he said.

Bata India reported a turnover of Rs 743.17 crore during the year ended December 1998.

The Faridabad unit produces only 1.25 crore pair of rubber and canvas footwear per annum compared to Bata India’s total production of Bata Nagar unit in Calcutta which produces 2.8 crore pairs of rubber and canvas footwear and 83 lakh pairs of leather footwear.

Bajaj Auto sued: A city plastic moulding company has dragged Bajaj Auto Limited to court for “arbitrarily terminating” the business contract (MoU) and for recovery of dues to the tune of Rs 79.64 crore.

The company, Sandeep Polymers Private Limited (SDP), supplying plastic panels to Bajaj for its scooters and which had made huge investments as part of the agreement, has accused Bajaj of breach of trust, Managing Director Dileep Nivatia told reporters here yesterday.

The suit has been filed before the third joint Civil Judge (senior division) and notices were issued to respondents, Bajaj Chairman-Managing Director Rahul Bajaj and his elder son Rajiv, returnable by November 30.

Nivatia said Bajaj has transferred the supplies to a Pune-based firm promoted by it and withheld payments against the current supplies by SDP.

The amount pertains to approximately Rs 4 crore towards the cost of manfactured moulds, Rs 15 crore for incurring losses and Rs 45 crore towards estimated losses.

Finolex, Enkay offer: Finolex Cables Ltd and Enkay Telecom have offered the Maharashtra Government to become equity partners in the State’s efforts at networking the entire State.

“Finolex and Enkay have offered equity participation in the venture to lay ducts and cables, initially along the Mumbai-Pune expressway to provide connectivity to various Internet service providers, educational institutions and government and semi-government bodies,” Finolex said in a statement here today.

The venture will endeavour to connect the entire State through the Mumbai-Nashik, Mumbai-Nagpur and other such highways to cater to the huge demand for connectivity.

The Chairman of the Rs 2,000 crore Finolex group and the Enkay Chairman have already discussed with Chief Minister Vilasrao Deshmukh the proposal that envisaged investments of Rs 300 crore.

Finolex has taken the initiative of setting up “international institute of information technology” at the Pune infotech park at Hinjawadi to impart quality instructions in advanced software development and telecommunication.Top



 


by Ashok Kumar
Hind Lever, Britannia still good bets

Q: Can investment in the shares of Britannia Industries translate into gains?

— Karan Sampat, Shimla

Britannia Industries Ltd (BIL) is a prominent fast moving consumer goods company. The company has recorded a good financial performance. For the year that ended in March 1999, BIL posted sales and net profit at Rs. 1030.1 crore and Rs. 39.6 crore respectively, thus resulting in an EPS of Rs. 20.7. The bottomline of the company has reported a 37 per cent growth. The good performance of the company has been achieved by a 16 per cent growth in biscuit volumes.

The corporate has made a recent foray into the snacking segment with its Snax range of baked products. BIL has targeted a minimum 20 per cent top line growth per annum over the next few years. The company believes that the same can be achieved through growth in the biscuits business and, expansion of the dairy business and acquisition of biscuit manufacturers. Thus, its appears that the company is to perform better in the coming years. Investment could prove remunerative.

Q: Should I buy into the shares of Hindustan Lever?

—Varun Bajaj, Chandigarh

Hindustan Lever Ltd (HLL) is a leading blue chip company with diversified interest. The company is backed by excellent credentials and a track record which sing the same tune. It commands large chunk of the soap market (66 per cent) and also 9 per cent of the global tea market. On the financial front, the performance of the company was good. For the year that ended in December 1998, sales and net profit stood at Rs 9461.8 crore and Rs 805.7 crore respectively. The EPS therefore worked out to Rs 34.5 Coffee reamins a small business for HLL, and even though Unilever has plans to exit the segment. The company is likely to continue in its merry ways in the coming years. Discerning investors could consider adding this scrip to their portfolios for medium to long term gains.

Q: Are the medium to long term prospects of BPL good?

— Ravi Mehta, Jalandhar

Established in 1963, BPL is the largest player in the electronic consumer goods industry. Based in Bangalorre, the company is mainly engaged in manufacturing home entertainment electronic products. The company enjoys a market share of 30.8 per cent in the colour T.V. segment. On the financial front the company’s performance has been satisfactory. During the financial year that ended in March 1999, the company posted sales and net profits of Rs 1939.7 crore and Rs 102.5 crore, thus yielding an EPS of Rs 30.4. The company’s alkaline battery project in Karnataka which was under process has been completed as scheduled. The overall performance of this company has been good. The only worrying factor about this company is that it has been rightly or otherwise come to be linked with the erstwhile Big Bull, making a long-term investment commitment in this scrip debatable.

Q: Should I hold or sell the shares of Berger Paints?

— Kaveen Brar, Chandigarh

Berger Paints stands at the third position in terms of market share. During the financial year 1998-99, the company’s sales amounted to Rs 246.6 crore, and its profits stood at Rs 22.0 crore, thus yielding an EPS of Rs 9.4. Berger Paints recently celebrated its platinum jubilee year by rewarding its shareholders with a 1:1 bonus. Hence, one could consider booking profits at the moment and re-enter this scrip at lower levels.

Q: Will investment in the shares of MTNL prove remunerative?

— Saloni Jetwani, Bathinda

Mahanagar Telephone Nigam Ltd (MTNL) holds a licence for basic services in Mumbai and Delhi. With the decontrol of the industry and private sector companies expected to venture into telecom soon, the company is planning to restructure its operations. MTNL now plans to lay emphasis on quality and consolidate its leadership position. On the financial front, the company can boast of a impecabble track record. For the year that ended in March 1999, the company posted sales and net profit at Rs 5246.8 crore and Rs 1317.3 crore respectively. The EPS therefrom worked out to Rs 20.9. The company is planning to retain customers by offering them extended services like call waiting, call transfer, abbreviated dailing, etc. Thus, discerning investors could continue to remain invested in this company.Top



 


by K.R. Wadhwaney
Safety first, ego later

THREE manufacturers of aircraft, all foreign, have indulged in all kinds of practices. The manufacturers have chosen their person to “lobby” for them in briefing. Those, who are prepared to toe their line are invited, while others, are conveniently ignored. They have their own agencies which select people who are supportive. No one knows who will eventually win the race in the battle of attrition. Differences between politicians and bureaucrats have surfaced. In view of these developments, unethical and unholy as they are, there are fresh bids for staging ‘briefings’.

All three manufacturers are well known. Suffice it to say that all three manufacturers are good. Why can’t the Government depend upon its own engineers and pilots, who are second to none. Their opinion and observation should be respected. The safety of people and well-being of aircraft are more important than exaggerated ego of politicians and bureaucrats. Engineers and pilots have been in service for years and their opinion should have more value than little knowing politicians.

New Chairman: Mr Ravindra Gupta, Secretary of Civil Aviation Ministry, is also part-time Chairman of Air India. A diploma holder in Air and Space Law from McGill University (Montreal), he has varied experience of civil, financial and industrial administration. His knowledge about aviation is said to be sound.

Gupta will meet officials of the International Civil Aviation Organisation to discuss routes and slots that Air India and Indian Airlines should be accorded.

Hotel Corporation of India has been Air India’s subsidiary. But it has always been plagued by problems from within. Both units, Centaur Hotel, in Mumbai and Delhi have generally been facing difficult situation.

The occupancy in the hotels is poor and service still poorer. Such is the situation that even Air India officials and crew refuse to stay there.Top


 

Grape vine

ITC

FOLLOWING a series of adverse court rulings against tobacco manufacturing firms in the USA, ITC’s fortunes seem under a cloud all of a sudden. The grapevine has it that environmental protection groups have been maintaining a close watch over this tobacco major in India. Sound ominous!

Nirma

This company which entered the Hall of Fame by being one of the few companies worldwide to successfully take on the Unilever group on its own turf would have been the first company to issue its shares through the book-building route, but it chose to back out at the last moment more than a year ago. However, the grapevine has it that the improved market conditions have emboldened it to consider yet another foray into the market. Watch this space.

Hughes Soft

The high profile book-building IPO of Hughes Software had turned controversial following the attempt by one of its lead managers to cash in on the demand for the company’s shares. However, with a listing price in excess of Rs 1,500 all the ill-will has been laid to rest. What’s more this scrip is tipped to be the next Infy at the bourses. All’s well that ends well!Top


  H
 
  Inflation up
NEW DELHI, Nov 21 (PTI) — The inflation rate crossed the 3 per cent mark, rising to a 22-week high of 3.01 per cent for the week-ended November 6 on account of a spurt in the prices of food articles.

BHEL meet
NEW DELHI, Nov 21 (PTI) — BHEL will organise an all-India meet with its vendors here tomorrow.

Telco clinics
NEW DELHI, Nov 21 (PTI) — Telco has set up anti-pollution clinics for trucks as part of company’s drive for a cleaner and greener environment. Free emission check-ups are being offered to all TATA trucks at specified check-points in New Delhi, Mumbai and Pune. Top



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