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April 24, 2001, Chandigarh, India   
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Basic, cell operators lock horns
Birlas hike stake in Indian Rayon
Electrolux Home opens HLL net may rise 13-22 pc CMC sell-off plan
challenged |
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LIC registers
37.53 pc growth Ceiling on banks’ share
financing Aromatic Oils
project opens Zee offers
courses on Internet CORPORATE
NEWS Sterlite Optical
net vaults 139 pc
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Basic, cell operators lock horns New Delhi, April 23 In a letter to Finance Minister Yashwant Sinha, who heads the Group on Telecom and IT (GoT-IT), COAI said today the cellular operators were willing to take on a rural roll-out obligation spread over a two-year period, while providing local rural telephony service at fixed line tariffs of Rs 1.20 for three minutes subject to certain conditions. COAI said that the subsidised mobile services could be delivered on the condition that the government and the Telecom Regulatory Authority of India (TRAI) addressed issues of interconnect points, appropriate terms of interconnection and support from the Universal Service Obligation (USO) fund. The association, however, refused to soften its stand on permitting limited mobility to fixed operators saying, “the so-called limited mobility is a full cellular mobile service and therefore the current proposal of the government discriminates between the two types of cellular operators.” “The FSPs should be provided all possible benefits, for example, even the waiver of revenue share licence fees and provision of level playing field vis-a-vis licence entry fee for new FSPs, but only within the ambit of their fixed service licence structure which has no provision for any type of mobility service,” it said. ABTO too has communicated to the GoT-IT its failure to reach a consensus as the cellular operators remained firm on their stand on mobility issue. ABTO said that no consensus could be arrived at as COAI stated that a starting point for such discussion was that all kinds of mobility should be only with cellular mobile service providers, and added that this position was unacceptable to ABTO. The cellular operators, meanwhile, stated that the government should immediately request TRAI to suggest CMSP terms and conditions necessary to arrive at a cost and revenue structure that would facilitate the delivery of mobile services at an affordable tariff, even for urban customers. “Alternatively, if the government believes that subsidising the entire telecom sector is not desirable for urban markets, it should direct TRAI to review all cost and revenue data for existing and prospective cellular operators with a view to enhancing affordability from the current levels,” COAI said. Suggesting that TRAI should determine appropriate tariffs based fresh economic analysis and due-diligence by reviewing and finalising additional allocation of spectrum, fair interconnect terms and immediate introduction of a viable Calling Party Pays (CPP) regime. On the contentious spectrum issue, COAI said that spectrum use would be more efficient if spectrum for cellular mobile services were clearly demarcated and reserved. “There must be a clear allocation process which includes bidding for new cellular mobile licences and enhancement of spectrum to existing cellular licencees to maintain quality standards,” it said.
PTI
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Birlas hike stake in Indian Rayon
New Delhi, April 23 “We informed the stock exchange authorities about the development earlier this month,” Chief Finanancial Officer (CFO) of Indian Rayon Adarsh Gupta told PTI from Mumbai. When contacted an
A. V. Birla spokesperson said “promoters have increased their stake in Indian Rayon by 2.5 per cent to take it up to 26.5 per cent. But this is nothing new for the group. In the past also the group had increased its holding via creeping acquisition route.” Asked about the Delhi based Abhishek Dalmia’s reported interest in Indian Rayon, where he claimed to have acquired one per cent equity, the spokesperson said “our consolidation has nothing to do with any outside development.” When contacted, Dalmia said “we are happy to see that the management (of the company) also perceives that the stock is undervalued at the current price”. He, however, added that he had cut down by half his holding from 2 per cent about two years ago. Gupta declined to divulge the price at which 2.5 per cent equity was acquired by the promoters over the last few months and said creeping
acquisition route was not new for the company, which took recourse to it in 1998-99 too. Asked if the promoters would further consolidate their position and increase their stake, he said “it is the subject matter to be decided by the promoters.” Abhishek Dalmia said “we are passive investors in Indian Rayon but I do not plan to offload the stake we hold in the company at this point in time”. He said the Dalmia Group had bought just over 2 per cent of the rayon company’s equity two years back “but decided to offload 50 per cent of it because we wanted to trim exposure in Indian Rayon and invest on other emerging opportunities”. Meanwhile the Indian Rayon scrip touched its 12-month high at Rs 107 while its 52-week low was Rs 45; the share is hovering around the Rs 77 mark at present.
PTI
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Electrolux Home opens Chandigarh, April 23 Electrolux Home, the first in the series will house home appliances of brands Electrolux, Kelvinator, Allwyns, Electrolux Maxclean and Electrolux WhiteWesting House. The product range from these brands include — direct cool and frost free refrigerators, split and window air conditioners, front & top loading washing machines, cooking ranges, microwaves, dishwashers and deep freezers. Mr Ramasundar said, “This initiative is not only to showcase our entire range of multi-brand state-of-the-art products under one umbrella but also to make it a one-stop shop for quality products and services.” Electrolux is the largest home appliance manufacturer in the world with 28 per cent market share for refrigerators and annual sales figure of over $ 16 billion. The Electrolux group in India is a market leader in refrigerator, with its three brands Electrolux, Kelvinator and Allwyn. Electrolux target a turn of Rs 1,000 crore this year Mr Ramasundar said the company is exporting appliance to Indonesia and far-East countries except European countries. Mr Ramasundar said despite the soft Budget and concessions, customers for the products are small. He said the WTO will affect the Indian market definitely as the prices of Indian products match the imported products.
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HLL net may rise 13-22 pc New Delhi, April 23 HLL, 51 per cent owned by Anglo-Dutch giant Unilever Plc, is the market leader in most of its Indian businesses — soaps, detergents, food products and cosmetics. For the past quarter, a Reuters poll of 12 brokerages forecast, on average, net profit would rise 22.34 per cent from a year earlier, but fall 25.28 per cent from the previous quarter. The survey projected net sales would rise 4.16 per cent year-on-year and 2.83 per cent quarter-on-quarter. "My expectations of HLL's net profit are in the region of Rs3.19 billion ($68 million), growth of 21.47 per cent. Net sales could rise 5.1 per cent to Rs27.48 billion," said Sandeep Rajani, analyst with DBS Securities. "The growth (in net profit) will come out of efficiencies from operations. They are expected to improve further," Rajani said. Richard D'Souza, an analyst with Sunidhi Consultancy Services, held a similar view. "HLL's first-quarter net growth would be because of a focus on cost reduction and administrative efficiencies," D"Souza said. HLL leans heavily on its well-oiled distribution chain — consisting of over 3,400 distributors and more than 16 million outlets across the country — to wring out supply chain efficiencies and to keep competitors at bay. But smaller and more agile domestic firms have managed to make a dent in the giant's market shares in the tea and soaps business, which account for around 40 per cent of sales. It sales growth rate has slowed in recent years, partly on account of its huge base but also after a decade of blistering growth fed through acquisitions.
Portfolio In a bid to boost sluggish sales and win back market share, Hindustan Lever decided late last year to focus on the top 30 of its 110 brands and take on new businesses. These 30 brands account for 75 percent of turnover. Rajani said the effect on operating figures could take a half year to emerge. "For a company of this size, let us give them at least six months for a perceptible change accruing out of the brand restructuring exercise." Rajani indicated that the personal care and food products industry has been targeting the Indian rural sector, where about 70 per cent of India's one billion people live, to fuel growth.
Share price True to the defensive nature of its business, HLL's stock has been an island of relative safety amid the recent carnage on the domestic bourses. Hindustan Lever has appreciated 9.85 per cent since the start of 2001, in contrast to the 9.4 per cent decline by the Bombay Stock Exchange's benchmark index. Since March 1, when the Indian markets started to plunge on allegations of share price manipulation and other irregularities, Hindustan Lever at its lowest point — on April 16 — lost a fifth of its value, while the benchmark index came off by 27.51 percent in the same period.
Amalgamation plan HLL will consider a proposal for amalgamation of its two subsidiaries, International Bestfoods and Aviance with itself at its Board Meeting here tomorrow. The company proposes to settle the draft scheme of amalgamation, decide the share exchange ratio and all other related matters in the meeting, HLL said in a notice to Bombay Stock Exchange here today. International Bestfoods (IBL) became a subsidiary of HLL with effect from Saturday last. HLL currently holds a 83.36 per cent stake in IBL and the former paid Rs 57.75 crore (Rs 131 per share) to Best Foods USA for acquiring 75.38 per cent shareholding. The balance stake (7.99 per cent) was acquired through an open offer made in October last.
Reuters, PTI
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CMC sell-off plan
challenged New Delhi, April 23 Justice Vijender Jain issued notices to the Ministry of Information Technology, the Disinvestment Ministry and CMC asking them to file their reply to the petition seeking to restrain the government from transferring its 57.31 per cent equity in the PSU to a private party. “As a public sector company wearing the hat of the government, the PSU was vested with certain rights which develops into largesse and they should not be passed over in the garb of disinvestment to private entrepreneurs,” senior advocate Kailash Vasudev and Shyam Moorjani appearing for the petitioner Nirmal Kumar Jain, a software expert, contended. Stating that CMC was not in the list of the companies to be disinvested as its name was withdrawn from the disinvestment corporation, the petitioner said after the proposed sale the government will hold only 26 per cent of the equity in the PSU and the rest of the share was being sold to one single private sector through strategic sale and other means. The petitioner also submitted that a bare reading of the memorandum on the disinvestment of CMC shows that it was couched in a very guarded language and what is actually being passed on to the alleged strategic partner is not clear. “What is purported to be passed on is in fact public property and a backdoor supply which a
private sector otherwise is not entitled to except by obtaining through a process of open tender,” the petition said. The petitioner also submitted that through appropriate role in management to such strategic partner, the intention of the government was to pass on the management of CMC to a private body. Apprehending that once the PSU goes to the private sector, the jobs, works, benefits, assets obtained by CMC from various government organisations would be relinquished, the petitioner sought details of the all work being done by the PSU and those done by the private sector so that rights of either sector could be completely appreciated.
PTI |
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LIC registers
37.53 pc growth Mumbai, April 23 Mr Bajpai stated that the organisation had crossed significant landmarks and registered all time high growth rates in first premium income and sum assured under new policies in the first year of the competitive era in the LIC. Mr Bajpai said during last fiscal year LIC sold 200,01,448 new individual policies which registered a growth rate of 16.29 per cent over the previous year. The sum insured under new policies crossed the landmark of Rs 1,00,000 crore to touch the figure of Rs 1,29,754.24 crore, registering a growth rate of 37.53 per cent a new record. The first premium income which showed an all time high growth of 64.98 per cent amounted to Rs 6262.39 crore. In the pension and group business, 8122 new schemes were sold, covering 12,50,321 new lives and generating a premium income of Rs 696.37 crore, he added. LIC saw a 15.79 per cent rise in individual assurances policies at 196,56,679 and the sum assured at Rs 1,24,771.35 crore (up 36.79 per cent). The first premium income stood at Rs 5,699.64 crore (up 63.59 per cent), he said. In case of individual pension plans the polices sold, sum assured and first premium income stood at 344769 crore (+54.37 per cent), Rs 4982.89 crore (+59.10 per cent) and Rs 562.74 crore (+80.49 per cent) respectively, he added. LIC was expecting a 20-22 per cent growth in total premium in 2000-01, he said. The corporation has tied up with five vendors, Bill Junction, TimesofMoney, Bank of Punjab, ICICI Bank and HDFC Bank for premium payment through Internet.
UNI, PTI
Ceiling on banks’ share financing Mumbai, April 23 The ceiling would cover direct investment by banks in equity shares,
convertible debentures (CDs), and units of equity oriented mutual funds, advances against shares and debentures and guarantees issued on behalf of brokers, the apex bank said in its proposed amendments in the guidelines in the light of recommendations of the RBI-Securities and Exchange Board of India technical committee. The 5 per cent ceiling would be computed in relation to total advance, including commercial paper (CP) as on March 31 of the previous year as against total outstanding domestic credit as on March 31 of the previous year under the earlier guidelines, it said seeking comments from bankers and experts. Further, for computing the 5 per cent norm, direct investment in shares by banks would be calculated at the price paid by banks at the time of acquisition of shares, it said. The RBI said it proposes to leave to the discretion to fix both the sub-ceilings for total advances to all the stock broker as well as a single stock broker (and connected undertakings) to the bank boards. As a safeguard to prevent any +nexus+ from emerging, it is proposed that there should be a clear separation of responsibilities for making decisions about actual advances against shares/investments in shares and surveillance & monitoring of actual advances/investments in shares by banks. The RBI said it would be desirable if the Chairman-cum-Managing Director/CEO is entrusted with the responsibility for surveillance and monitoring and is not a member of the investment committee (IC).
PTI
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Aromatic Oils
project opens Hoshiarpur, April 23 Mr Dhindsa said that diversification of agriculture was need of the hour. The climatic conditions in Punjab especially in Kandi area were most suitable for the cultivation of flowers, fruits and medicinal plants. Composite project of Aromatic oils would not only strengthen state economy but also encourage the farmers for flower cultivation. Mr Balramji Dass Tandon, Minister for Local Government, Mr Sewa Singh Shekhwan Minister for Revenue, Mr Sucha Singh Langah Minister for Public Works and Mr Tikshan Sud were also present.
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Zee offers
courses on Internet Chandigarh, April 23 On offer are the courses ranging from information technology, e-careers, management and marketing , e-journalism, Netpreneurship and e-travel and tourism. Several courses in IT having university certifications like M.Sc in software, post-graduate diploma in software and programming courses to courses, including palmistry, pet management, party management and medical transcription, etc. These courses which are available online offer faster VSAT Internet access to the study material which will be provided by
ZCA-i-cell.
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co
Sterlite Optical net vaults 139 pc Mumbai, April 23 Total income in Q3 was Rs 235.82 crore as against Rs 150.45 crore in the corresponding period of last year. Export sales stood at Rs 86.29 crore (Rs 3.62 crore in Q3 of last fiscal), it added. During the reporting quarter the company allotted 79,996 equity shares of exercise of options by employees as per the ESOP scheme, the notice said. MOSER BAER NET DOUBLES: Moser Baer India today announced an increase of 124 per cent in total revenues at Rs 351.35 crore in 2000-01 from Rs 156.74 crore in 1999-00 while its annual profits rose by 213 per cent to Rs 138.50 crore from Rs 44.11 crore last fiscal. Moser Baer’s fourth quarter net profit doubled to Rs 38.55 crore for the year ended March 31, 2001 against Rs 19.84 crore during the same quarter last fiscal. The company attributed the performance to increased sales of branded products in the European markets and addition to its large original equipment manufacturers accounts. INDO-GULF CORPORATION LTD (IGCL), an Aditya Birla Group company, has registered a 18.59 per cent increase in net profit at Rs 251.67 crore for the year ended March 31, 2001, compared to Rs 212.21 crore in corresponding period of last fiscal. The board has recommended a 24 per cent dividend for 2000-01, Debu Bhattacharya, Managing Director, told reporters. The Board of Directors of the
RAYMOND LIMITED has recommended a 30 per cent dividend for the fiscal year ended March, 31, 2001, which is double of the previous year’s 15 per cent. The company has recorded a significant rise in net profit at Rs 32.22 crore for the year ended on March 31,2001 as compared to Rs 31.71 crore in the corresponding period in the previous year. SKF BEARINGS INDIA LTD has recorded a 50 per cent lower net profit at Rs 1.7 crore for the first quarter ended March 31, 2001 as against Rs 3.4 crore in the corresponding period last year. Sales to were down by 8.7 per cent at Rs 84.2 crore from Rs 92.3 crore in
the corresponding period of FY 2000, SKF said. ZYDUS
CADILA, the Ahmedabad-based pharma company, has launched its fifth speciality division Cadila Neurosciences recently, a company release said here today. This division would start introducing products in the market from next month. BHARAT ELECTRONICS LIMITED, today reported a net profit of Rs 145.64 crore for the year ended March 2001, up from Rs 107.93 crore in the previous fiscal. The unaudited financial results were taken on record by the Board of Directors at their meeting here. Total income rose to Rs 1,771.16 crore in 2000-01, compared to Rs 1,527.72 crore last year. GRASIM INDUSTRIES LTD (GIL), an Aditya Birla Group company, has commenced curtailing operations at its staple fibre plant in Nagda, Madhya Pradesh, and it is likely to be shut down in the first week of May till the onset of monsoon due to acute shortage of water. The company has started curtailing operations in its Chennai plant too, and from May 2001 till onset of monsoon, operations would be at about half of the normal level. ISM INDIA PVT LTD, a subsidiary of US-based International Shoe Manufacturing Corporation, has firmed up plans to acquire majority stake in the Montari group company, Montari Leather Ltd. ISM India will acquire 50.94 per cent stake in the ailing Bhai Manjeet Singh company, Muntari Leather, for a consideration of Rs 9.75 crore for which both the promoters have already inked an MoU. With this acquisition, Montari group’s stake in the company will come down to 26.96 per cent from the current level of 50.1 per cent while public holding would reduce to 2.98 per cent from 49.9 per cent. Sunil Mittal promoted BHARTI GROUP will raise upto $ 200 million through private placement of equity over the next few months to part-finance its telecom projects. “With the plans for listing on hold due to unfavourable market conditions, the company has decided to go for private placement to the tune of $ 175 to 200 million in order to meet any fund requirement,” company sources said.
Agencies |
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