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April 9, 2001, Chandigarh, India   
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Infosys, Zee top wealth destroyers
Microtex may set up unit in Punjab
Human flesh on sale in Moldova Kate Connolly Sting operation
in Ludhiana |
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Hero Honda now becomes
debt-free Jindal Strips
hikes capacity at Hisar The intelligent
live longer FIIs net buyers in equities Cycling & walking declining Inflation dips
Clinton happy with IA operations
The worst is over
Q:- I am paying annual lease rent of Rs 56,500 to Estate Office, Chandigarh, for my house against purchase of 10 M plot. I have purchased a residential plot of 10 M at Chandigarh through auction with deferred payments. I am paying the amount in instalments along with interest. Now I have completed the house on the land in April, 2000. Is the interest paid on deferred payment to Estate Office is deductible from my income up to Rs 1 lakh.
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Infosys, Zee top wealth destroyers
New Delhi, April 8 The 10 companies cumulatively recorded a whopping 71.4 per cent loss in terms of market capitalisation between March 31, 2000 and March 30 this year, reflecting the turbulance that gripped the bourses across the country. Market capitalisation of these companies was pegged at Rs 99,132 crore as on March 30, this year as against Rs 3,46,092 crore recorded on March 31, 2000, a fall of Rs 2,46,959.72 crore, going by the scrip value on the respective days at the Bombay Stock Exchange. Among the other companies which witnessed largest fall in market capitalisation were HFCL, Global Tele, VSNL, Satyam Computers, ITIL and MTNL. In terms of the percentage fall, the honours were shared by Information Technologies, Global Telesystems and HFCL, which saw a drop of 97.4, 92.6 and 88.6 per cent respectively. During the same period, BSE Sensex has lost 27.9 per cent to 3604.38 points, with the Nifty dropping by 24.9 per cent during the year to 1148.2 points from 1528.45 points. Significantly, all the top 10 wealth destroyers belong to the ICE sector, with the largest fall in absolute terms being generated by Wipro of Rs 94,865.10 crore. Zee Telefilms followed with Rs 36,722.93 crore worth of fall in market capitalisation over the last one year and Infosys at Rs 31,877.99 crore. In percentage terms this works out to a drop of 75.4 per cent, 88 per cent and 54.1 per cent respectively. Among the other companies which saw a significant drop in market capitalisation, include Satyam Computers with a drop of 18,329.09 crore (73.6 per cent) and HCL Technolgies with Rs 13,860.69 crore (57 per cent). Surprisingly, two public sector undertakings, Videsh Sanchar Nigam and Mahanagar Telephone Nigam, figure in the top 10 list of wealth destroyers. While VSNL has seen its market capitalisation fall by Rs 9,158 crore to Rs 8,322 crore, a decline of 52.4 per cent, MTNL has seen a fall of 6,470.1 crore to Rs 8,334.9 crore, a drop of 43.7 per cent.
Satyam lays off staff
Vision compass, the US-based subsidiary of Satyam Computer Services Limited, has terminated the services of its Chief Executive, Dr Robert Bismuth and 39 other personnel, besides reducing operating costs by 70 per cent as part of its restructuring programme. Satyam’s Seattle (USA)-based Vice-President, Dr Sudhakar Varanasi, would succeed Bismuth and hold all executive and administrative responsibilities during the restructuring phase, Satyam said in a release in Hyderabad today. The restructuring exercise is likely to reduce operating costs from the present $ 1.1 million to $ 0.35 million per month. In order to curtail any further investment in the subsidiary, Satyam is also evaluating a few proposals from stragegic financial investors. The US subsidiary was responsible for marketing the Vision Compass product to three specific industry segments encompassing, manufacturing supply chain, telecommunications and professional services. The product was also being actively marketed to existing Satyam customers. To further increase market penetration, the company has a partnership programme with several value added resellers, including Litton PRC Overseas, Outsights, Phoenix Group, and Oasis Software LLC. Vision Compass has been extensively beta-tested at large global corporations and over 100 leads have been generated from prospective customers. With this thrust the product is expected to generate revenues from this quarter onwards.
PTI
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Microtex may set up unit in Punjab Chandigarh, April 8 This was announced by Mr Vinay Reddy, Director of the company, which belongs to the VIP brand owning the Rs 300 crore turnover group. OTC-listed Maxwell (Rs 190 cr sales) and Loveable are the other two companies of the group. The company has a branch office in Jalandhar which caters to the dealers in Haryana and Himachal, besides Punjab. "Double taxation is a big problem for the company products supplied by the Jalandhar branch to the neighbouring states", said Mr Sharad Prasad, National Sales & Marketing Manager of Microtex India. With the recent lifting of the quantitative restrictions (QRs) the garment industry faces competition from China and Indonesia, said Mr Reddy.But the group is not unduly worried. As the quota system will be phased out by the developed countries by the end of 2004, an opportunity will arise for the Indian garment industry to access the developed markets, he said. Asked if the textile industry was prepared for global competition, Mr Reddy said: "The Indian industry was lazy and bloated. It did not get sufficient time and support from the government to shed fat and be globally competitive." |
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Human flesh on sale in Moldova Kate Connolly
Chisinau, Moldova, April 8 Tales of poverty and decay are now typical in Moldova, a republic of about 4.5 million people, wedged between Romania and the Ukraine. It has been plagued by political corruption and incompetence since it became a victim of the end of the Cold War. The country has become the first of the 15 ex-Soviet states to return communists to power. Its economy has shrunk by 60 per cent
since 1991. Illiteracy in villages has risen threefold, life expectancy has fallen by five years. In a clinic in the capital, Chisinau, last month a cleaner is said to have sold body parts due for incineration to two local women, who sliced them into steak-sized portions and sold them to passers by in the town centre at US $ 2 a kilo, half the market price for meat. One shopper became suspicious, and tests proved the meat was human flesh. The Health Ministry has launched an investigation. Moldovans are shocked and ashamed. One newspaper asked: “Have we now resorted to cannibalism?” The scandal, it is insisted, is a one-off. There are other examples, however, of desperate times begetting desperate measures. The World Health Organisation says the sale of body organs by healthy donors has become a thriving industry. Recruiters acting for agents in western Europe, Israel and Turkey buy them for as little as $ 3,000 apiece - eight years’ salary to the average Moldovan - to be sold on to sick people for 100 times more. Balkan gangs are using Moldovan women as surrogate mothers. The women are paid as little as $ 5,000 to have babies they will never see again for childless couples in Italy, Greece and Germany. “The girls go and live in the country where their customers are, or the foreign couples come straight to the hospital in Moldova after the birth and whisk the baby away,” one charity worker in Chisinau told The Observer. Thousands of other women go abroad in search of menial work, and end up in the hands of human traffickers who steal their passports and force them into prostitution. “Job offers” for women in the weekly paper Makler include almost 100 adverts that charity worker Olga Graur deems “highly suspicious”. “Young,
Another advert reads: “Know English? Can you dance? We’ll sort out the contracts - $ 800 in two weeks.” So desperate is the problem that charity workers now visit schools to tell girls about safe ways to find work abroad. Between 700,000 and a million Moldovans are believed to be working
The World Bank says the millions of dollars sent home in hard currency is helping to hold the economy together. But the mass emigration labour drain is having devastating social consequences. At the run-down 1,000 pupil high school in the village of Besalma in southern Moldova, headteacher Taysya Tashy has seen a third of her staff go abroad in recent year. By arrangement with The Observer
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Sting operation
in Ludhiana Miniaturised audio and video technology will have profound effect on business. It is a fact that in almost all illegal transactions one side is invariably the business. Whatever be the effect of sting operation at the national level. Ludhiana in particular will be different from now. Ludhiana has seen many violent reactions to the bride-taking operations which are widespread but going on smoothly as a rule. In the past people have even succeeded in taking photographs where bribed money is being returned under pressure. The operation of hidden cameras is the talk of the town. Some people seem to have succeeded in possessing the gadgets which were used by tehelka.com. Although such matters are kept secret but the way things are moving it is very likely that possession is a reality. Some details are also a pointer to this. The gadget costs from & 500 to & 5,000 depending on quality. In England its price is quoted at £ 2,200. It has four components; miniaturised camera often the size of 25 paise coin or even smaller; a miniature video recording device; a cord to transmit the signals and a battery cell. The use of the cord can be avoided through wireless transmissions. The camera can be concealed in a briefcase, pager, cigarette lighter cell phone, fountain pen, smoke detector, nose frame of sunglasses or other spectacles. The components can be attached to the body of the user for operation. These devices have either a self-activating mechanism or can be activated manually. In many countries there is no ban on the sale and purchase of such equipment. They can be used in home or office. In some countries, including the USA its use is illegal. President Nixon had to lose presidency in watergate due to the use of such sting operation and his assistant in this operation was sent to jail. We have no law on sting operation. The USA’s ban on it is due to the reason that society may turn into a surveillance society. Washington-based Privacy International, a non-government organisation, is voicing against the danger of an uncontrolled use of hidden video and audio equipment and closed circuit T.V. In view of the importance of sting operations in the near future we, too, should have ground rules. Without this there may be chaos. But things are different in our case. Knowledge of illegal money changing hands is common. Prior permission may jeopardise the very purpose. If permission has to be sought from some official channel then it would open another channel of bribery. However, complex the matter may be but law has to be in place sooner than later. Business community has two views on the effect of sting operations. According to one bribery level may go up as some middle man may be required. Another view is that ultimately every official may feel nervous when final out come flashes through his/her mind.
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Hero Honda now becomes debt-free New Delhi, April 8 “We have become a debt-free company from March 21 this year. All our loans have been repaid much before their due dates,” Hero Honda Director (Finance) Ravi Sud said in an interview here. He said the company had repaid all its foreign currency borrowings totalling $ 13.2 million (over Rs 60 crore) to Development Bank of Singapore (DBS, Singapore), ABN Amro Bank (Amsterdam), Bank of America (Taipei) and Bank of Tokyo Mitsubishi Ltd (Singapore). Apart from this, Hero Honda had also taken a Rs 5 crore (over one million dollars) non-convertible debentures (NCD) loan from the Unit Trust of India which was also paid before its scheduled repayment date. Giving the break-up, he said, “it constitutes $ 1.3 million from DBS Bank, 3.3 million Japanese yen loan from ABN Amro, Bank of America loan worth Rs 4.75 million, Japanese yen from Bank of America and a three million dollars loan from Bank of Tokyo”. “We finished repaying our borrowings by completing the final instalment payment of the $ 1.3 million DBS Bank loan,” Sud said. He said the repayment period for the foreign currency borrowings ranged from three to seven years. Stating that it would help Hero Honda to further improve its financial position, Sud said during 2000-01, the company would post an operational income of about Rs 3,175 crore in 2000-01 and a profit before tax of Rs 390 to Rs 400 crore. During 1999-2000, profit before tax stood at Rs 277 crore over a sales turnover of Rs 2,399 crore. Hero Honda’s sales during the fiscal ended March 31, 2001 increased by 35.1 per cent at 10.29 lakh motorcycles as against 7.61 lakh units in the previous fiscal.
PTI |
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Jindal Strips hikes capacity at Hisar New Delhi, April 8 “We are in the process of infusing about Rs 25 crore in Massilon to fund its working capital requirements,” Arvind Parekh, Senior Vice President (Corporate Finance), told PTI. The company will fund the capital infusion completely through internal accruals. As part of its US business strategy, Jindal Strips had earlier raised its holding from the existing 51 per cent to 66 per cent and acquired 60,000 tonnes per annum stainless steel cold rolling facility. “Massilon will provide us with the platform to penetrate the vast but competitive US market,” Parekh added. He said apart from the USA, Jindal Strips was agressively looking at the Chinese and European markets. In an expansion mould, the company has enhanced the capacity of its cold rolling division at Hisar in Haryana from 30,000 tonnes per annum to 90,000 tonnes per annum involving an expenditure of Rs 250 crore. Parekh said with the enhanced capacity the company would expand its product portfolio and diversify into niche products like LPG cylinders, car exhaust systems and gift items. Jindal Strips has already diversified into the blade segment and is currently supplying about 10,000 tonnes of blade steel to the House of Malhotras. The company’s production line at Hisar in Haryana has already been upgraded to produce all value-added products
including skin pass mill, strip grinding line and bright annealing line. He said at present the company had 70 per cent exposure in the utensil market which would be brought down to 40-50 per cent.
PTI |
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The intelligent
live longer London, April 8 It is not clear though how intelligence is linked to longevity, but genetic and economic factors, childhood illness and diet may be part of the reason. The researchers used details of IQ tests taken by 2,792 children in Aberdeen at the age of 11 in 1932 and then followed them up to see who was still alive in 1997. They found that both men and women with higher IQ scores as youngsters were much more likely to be alive 60 years later. The researchers took an average IQ in the group as 100. Those still living at the age of 76 had an average IQ score of 102 at the age of 11, while those who had died by 1997 had an average 97.7 score. A 15-point lower score meant people had a fifth less chance of seeing their 76th birthday, while those with a 30-point disadvantage were 37 per cent less likely than those with a higher IQ to live that long. Study author Professor Lawrence Whalley of the University of Edinburgh said, “Our data show that high mental ability in late childhood reduces the chances of death up to age 76”.
DPA |
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FIIs net buyers in equities Mumbai, April 8 FIIs were net buyers on all the three days in equities while on debt front they were net sellers only on April 2 at Rs 0.2 crore ($ 0.1
mn), according to data available with SEBI. The BSE sensitive index fluctuated in a range of 3676.82 and 3436.33 before ending the week at 3576.00 as against last weekend’s close of 3604.38, a loss of 28.38 points. The market was closed on April five. On April 4, the foreign funds were net buyers in equities at Rs 176.7 crore ($ 38
mn), the highest for the week. The FIIs remained net buyers on April 2 and 3 in equities at Rs 133.4 crore ($ 28.7
mn) and Rs 108.3 crore ($ 23.3 mn) respectively. PTI |
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Cycling & walking declining London, April 8 Britons love their cars more than any other Europeans, a major new EU study shows. The number of commuters cycling and walking in this country is declining, while the number of cars and lorries on the road has tripled in the last 30 years. The report, The Hour of Choice — the first major transport study by the European Commission for a decade — says congestion costs Europe up to $ 120 billion a year. Road traffic in the EU is forecast to increase 50 per cent by 2010 and air travel by 70 per cent. “Europe is being asphyxiated by congestion,” the study says. Transport chiefs will use its findings this week to urge ministers to do more to reduce road traffic. In Britain that means trying to cut the need to travel, said David Begg, Chairman of the Commission for Integrated Transport — the UK Government’s advisory body: “We rely far too much on the car.” Begg blamed the increase in traffic on the growth of out-of-town shopping and business parks in the eighties.
The Observer
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Inflation dips New Delhi, April 8 The inflation rate based on Wholesale Price Index for all commodities (Base Year: 1993-94 = 100) fell by 1.07 per cent from 6.50 per cent in the previous week and the index was 6.49 per cent a year ago.
PTI
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Clinton happy with IA operations Technological development in ultra-modern aircraft and installation of sophisticated gadgets on ground have considerably reduced chances of mid-air collision. But the possibility always remains because of human fallibility more than failure of gadgets. Why does a mid-air accident take place. The reasons are — malfunctioning by Air Traffic Controllers, little rapport between ATCs and commanders, indifference of pilots, radar’s inconsistent reading or functioning and flaws in transmission. The question of an airmiss has figured prominently recently because there was a narrow airmiss between Indian Airlines and Lufthansa’s cargo plane over Tamil Nadu airspace. It was just a providential escape and the DGCA is conducting thorough probe into this airmiss. According to analysts, most of the areas have been equipped with ultra-modern and sophisticated gadgets but there are air-spaces, which are yet devoid of these gadgets. The International Civil Aviation Organisation (ICAO) has developed strategy for improved safety in aviation worldwide. Established in 1944, it has framed regulations for safety, security and economic air transportation. Mr R.C. Costa Pereira, Secretary-General of ICAO, during his four-day visit, impressed upon the authorities concerned that improved infrastructure would help improve safety of passengers and aircraft. Revealing that the ICAO is currently busy establishing an international financial facility for aviation safety for developing countries, Mr Pereira said: “ICAO will provide funds for training personnel, installation of safety-related reliable and technologically advanced navigational aids and development of maintenance facilities in the field of airworthiness.” “The funds will not allowed to be diverted for any other project,” he emphasised. According to Mr Pereira, there is expertise available in India and it should draw on the knowledge of these experts. He felt that Indian could be a force to reckon within the sphere of world aviation. VVIP operations For once, Indian Airlines has provided all comforts on the chartered Airbus 320 to VVIP guest Bill Clinton who has been on a private visit to this country. The airline, under the guidance of Commercial Director Anil Goyal, has maintained high efficiency and punctuality in adhering to the schedule. If Clinton has captivated hearts of quake-hit people in Gujarat, he himself is reported to have expressed satisfaction at the operations of IA. He has also been impressed with the functions of the cabin crew who, according to him, has been as efficient as hostesses of any other airline. Instead of worrying about revenue from chartered operations, the national carrier has tried to make the flights to Ahmedabad, Bhuj and Kolkata memorable for Clinton and his select group. |
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The worst is over IT
appears that the worst is over in the stock market but it is likely to miss any bullish flavour for quite a long time. After Ketan Parekh’s arrest and the exposure of many instances of inside trading and alleged rigging in the shares of Global Trust Bank and Arvind Johri’s Cyberspace, not many bulls are left in the market. Both the small investors and the mutual funds have suffered very heavy losses. Many stock market terminals have been closed. In the face of the fact that the Ministry of Finance as well as SEBI are bent upon introducing many changes in the management of the stock exchanges and in trading practices, no mutual fund or a major broker is likely to emerge as a bull to lift the market significantly. Last year the new economy scrips led the market to great heights but now these scrips are on the defensive. Slowdown in the US economy and greater competitiveness among the software companies are likely to eliminate smaller players and scale down the growth rates of the bigger players in the field. Ketan Parekh’s favourite companies have no buyers and are now quoting at very low P/E ratios. The banks are no more anxious to sanction liberal advances against the security of equity shares. What makes me think that the revival will continue during the next one month and a half is the consideration that by the middle of April, many leading companies would be announcing their annual results which are expected to be good. Pentasoft Technologies, for instance, declared very good results last week for the accounting year March 31, 2001. The company’s net profit has gone up to Rs 126.45 crore from Rs 85.50 crore last year. Last year it paid Rs 50/- as dividend. Its equity capital is Rs 18.10 crore with a book value of Rs 518.5. It is quoting around Rs 75/- or so but surprisingly it has no buyers. Partly it is due to the fact that it is in the rolling settlement list and partly because its management does not win any admirers. Many of the top ICE companies are expected to announce better results than in the previous year. Even some of the old economy shares will maintain their last year’s profitability. In spite of good results, the stock market is expected to remain sluggish because of three factors, fall in growth rates of ICE companies, sluggishness in the old economy shares due to greater competitiveness in view of the lifting of quantum restrictions on imports and lower rabi crop due to erratic rainfall. In case, SEBI places all the forward shares under rolling settlement, it will at least initially have a bearish effect on the market. Tata Finance has issued a rights issue of 9 per cent cumulative convertible preference shares (CCP) to its shareholders in the ratio of 1 CCP share of Rs 100 each for every 5 shares of Rs 10 held by a shareholder. Each CCP will be compulsorily convertible at the end of two years from the date of allotment at an average price of the equity shares quoted on the stock exchange, Mumbai, during the last six months prior to conversion, subject to a minimum of Rs 45 and a maximum of Rs 75 per share. I do not find the offer attractive enough for the shareholders to subscribe to it in spite of the fact that the fundamentals of the company are excellent and the interest of 9 per cent on each CCP will be income tax free. The simple reason for this view is that scrip is quoting at present around Rs 39 or so and is expected to repeat the dividend of 45 per cent. Why not invest in these shares at present and enjoy a return of more than 11.5 per cent for the first six months and later too? If the conversion price had been fixed at Rs 35 to Rs 40, it would have been an attractive offer. |
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R.N. Lakhotia Q:- I am paying annual lease rent of Rs 56,500 to Estate Office, Chandigarh, for my house against purchase of 10 M plot. I have purchased a residential plot of 10 M at Chandigarh through auction with deferred payments. I am paying the amount in instalments along with interest. Now I have completed the house on the land in April, 2000. Is the interest paid on deferred payment to Estate Office is deductible from my income up to Rs 1 lakh. Abhay Mehta, Chandigarh Ans: In respect of financial year 2000-2001 assuming that you have taken the loan after April 1, 99 then the interest to the extent of Rs 1 lakh will be deducted from your income. In case you have paid Rs 1.00 lakh or more on account of interest but the same pertains to different financial years, in that case the amount that would be deductible would be limited to the extent of interest pertaining only for the financial year 2000-2001. Q: I am a physically handicapped employee and have seen working in a nationalised bank since 1978. I am getting a conveyance allowance given to the physically handicapped employees @ Rs 100 pm I have come to know that in the implementation of the 5th Pay Commission report this allowance has been revised to Rs 400 pm from November 1998 under the new heading “Transportation Allowance”. I would like to know whether I am entitled to get this revised allowance or not and if it is so, is it taxable or not. Neel Kamal Masih, Jagadhri Ans:
If you receive transport allowance, the same would be exempted to the extent of Rs 800 per month for normal tax payers and Rs 1,600 per month for handicapped persons. Whether or not this allowance would be granted to you will be decided by your employer, as this is the internal matter of the employer and the employee. Q: I had purchased national saving certificate to get the tax benefits U/s 88. And in the following years claiming the tax benefit on interest portion which have accrued on the said amount. Recently I have raised a loan on the same from the bank. Now my question is whether we can still claim the tax benefit on the interest accrued portion in the coming year on the NSC on which loan has been raised, and am repaying in instalments. Secondly, whether it is mandatory to show the NSC in original to the employer, since it has been pledged with the Bank and it is not possible to show the original one to the employer. Vinod K. Joshi, Parwanoo Ans: You will be eligible to claim tax rebate on the accrued interest on NSC even when loan has been taken on the NSC It is not necessary for you to give to the employer the original NSC for the purpose of tax rebate. You can give a xerox copy as well. |
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