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July 18, 2001, Chandigarh, India   
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NIIT net seen down 26-35 pc
HDFC net up 19.25 pc
No sale of fresh US-64 units: Damodaran
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VRS introduced for Modern Foods New Delhi, July 17 Hindustan Levers Ltd (HLL) today said it has introduced a Voluntary Retirement Scheme (VRS) for four closed units of Modern Foods Limited (MFIL) and for its surplus employees at other locations and expects MFIL to break even within a few years.
Talks failure dashes
sugar exporters’ hope Industry regrets talks failure Telco leads list of top 10 losers Collateral free credit up to Rs 25 lakh for SSIs Haryana to sign
MoU with STPI
3 airlines sued over blood clots
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NIIT net seen down 26-35 pc New Delhi, July 17 NIIT—often referred to as the "McDonald's of education" for pioneering the franchisee model for teaching computer literacy — is expected to announce on Thursday a third-quarter net profit of
Rs 509 million to Rs 575 million ($10.8 million to $12.2 million). "My expectations are of a 26.3 percent decline...to Rs 575 million ...," said Priya Rohira, an analyst at Pranav Securities. "Overall margins have been under pressure, more so in NIIT's software services business." A Reuters poll of 12 brokerages forecast NIIT's net profit declined 34.76 per cent to a median figure of Rs 509 million. Forecasts ranged from 329 million to Rs 850 million. Net sales increased 4.01 per cent to 2.1 billion, according to the median of forecasts received, which ranged widely — from 1.80 billion to Rs 3.83 billion. Analysts said NIIT's education business, which accounts for almost half its revenue, would register nominal growth or even a year-on-year decline in revenue due to the global slowdown in demand for IT professionals. "NIIT's short-term courses have been badly hit," said an analyst who requested anonymity. "It's longer-term courses are also feeling the impact of the IT slowdown, but to a lesser extent." Late last month, a business daily quoted a senior NIIT official as saying there had been a 20 per cent fall in the number of students enrolling in short-term IT courses due to a downturn in the software sector. The domestic computer education business is estimated at Rs15 billion and NIIT is the largest player with more than 2,228 centres, including 100 abroad. The company previously had said it hoped to have 3,000 centres by September, including 200 overseas. "The key thing to look will be the education pricing strategy that they have adopted in the past quarter," Rohira said. Share price On Monday, NIIT ended 9.2 per cent lower at Rs 298.80 versus the 0.55 per cent fall in the Bombay Stock Exchange benchmark index. The shares have plunged 81.24 percent since the start of year, compared to a 13.15 per cent drop in the index. "NIIT has been one of the worst performers in the top-rung stocks in the last few months," said one analyst. "It is being quietly shunned by investors and fund managers because of the lack of growth and falling margins."
Reuters |
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HDFC net up 19.25 pc Mumbai, July 17 Income from operations grew by 14.62 per cent at Rs 633.07 crore in reporting quarter as against Rs 552.32 crore in the corresponding period of last year, HDFC Chairman, Deepak Parekh, told shareholders at the annual general body meeting here today. Other income in Q1 was higher at Rs 0.90 crore (Rs 0.36 crore in first quarter of last year). Approvals increased by 32 per cent at Rs 1,593.12 crore (Rs 1,205.97 crore) while disbursements rose by 31 per year). Approvals increased by 32 per cent at Rs 1,593.12 crore (Rs 1,205.97 crore) while disbursements rose by 31 per cent at Rs 1,225.43 crore (Rs 937.62 crore), it said. During the previous year, HDFC changed its policy of accounting for brokerage, to bring it in conformity with International Accounting Standards. As per the new policy, the total brokerage payable, other than incentive brokerage, is amortised over the period of the deposit. This has resulted in a reduction of
Rs 5.92 crore from the amount of brokerage in Q1 of last year. After adjusting Rs 1.37 crore towards tax, the net profit for first quarter of the previous year is consequently higher by Rs 4.55 crore, Parekh said.
PTI |
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No sale of fresh US-64 units: Damodaran Mumbai, July 17 He said UTI decision to allow investors to redeem up to 3,000 units was the first step in a series of measures the Trust had planned for the protection of investors. He also assured the investors across the country that their investments would be protected. Mr Damodaran was speaking at a function organised by Association of Mutual Funds in India (AMFI) here. “There is no need to panic as the situation is not that bad,” he said. After discussion with a few investor organisations in Mumbai yesterday, the UTI Chairman today announced the plans of a public campaign across the country as part of an exercise to interact with its investors. The UTI had come under severe pressure following redemptions of over Rs 1,965 crore by corporates in May. The large scale redemptions were due to fears with regard to the fate of the scheme and the reported fall in its net Asset Value in accordance with the fall in the equities in the secondary market. The UTI had announced ban on sale and repurchase of US-64 units scheme after the Board meeting on July 2. The UTI later allowed redemption to the investors up to 3000 units soon after the new chairman took over the reins of the country’s largest mutual fund on July 15. Offloading of portfolio Unit Trust of India (UTI) is considering the proposal of offloading its portfolio to the domestic financial and investment institutions to arrange for adequate liquidity for the limited redemption announced for small investors recently. The Investors’ Grievances Forum (IGF), however, has cautioned the new Chairman of the UTI, Mr M. Damodaran, with regard to the fallout of the
decision, said, Bharat Kotecha, Vice President of the forum. He further said the offloading by UTI may distort the market prices of shares, which in turn, will go against the interests of small investors. The forum has welcomed the resumption of limited redemption in US-64 scheme for small investors. They also feel that the limit of selling must be increased to 5000-10000 units
gradually. The prices of re-purchase should also be increased for the benefit of small investors, Mr Kotecha said. The forum feel that all the schemes of UTI should come under the SEBI regulations. It has also demanded the recovery of losses suffered by the UTI from the scamsters. The Chairman has also accepted the proposal of the forum to meet investors association representatives all over the country to explain the present status and future
strategy of the UTI, Mr Kotecha added. FM’s resignation demanded Bangalore:
CPI today demanded the resignation of Union Finance Minister Yashwant Sinha for the UTI’s US-64 muddle, saying he must take responsibility for the fiasco. A resolution adopted by the party’s three-day National Executive Committee meeting which concluded here today, alleged that “it is the deliberate inaction of the government that has allowed huge funds of nearly Rs 60,000 crore to be mismanaged leading to collapse of the US-64 scheme”.
PTI, UNI |
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VRS introduced for Modern Foods New Delhi, July 17 Targeting an over 50 per cent fall in losses to Rs 20 crore for 2000-01 over Rs 48 crore in the previous fiscal, HLL — which acquired 74 per cent stake in MFIL from the government last year — said it plans no fresh capital infusion but would modernise the MFIL plants, centralise wheat procurement and make Modern an “integrated wheat products business across the country”. Out of the 19 factories of MFIL, work at four was suspended between 1991-99 — Kirti Nagar (closed since June 1999), Ujjain (closed since March 1994), Bhagalpur (since October 1998) and Silchar (abandoned at the project stage itself in October 1991), a HLL
spokesperson said. “As per an MoU, the VRS was introduced at all MFIL locations, covering workmen of already closed units and surplus workmen at all MFIL units/locations. The VRS provides for payment of 65 days’ emoluments per year of service, as against government norms of 45 days’ emoluments)”. MFIL will “begin to make cash profit in the next few years” by improved operational efficiencies, modernisation of its factories and product development, which form the core of a turnaround strategy put in place by HLL, he said. Mentioning the factors which have pulled down MFIL’s productivity, the HLL spokesperson said outdated technology, non-functional, loss making units, low labour productivity and lack of customer confidence dogged the bread maker. “Out of the 19 factories of MFIL, four units have been closed down between 1991 and 1999. ....the non-functional and loss making units act as a drag on operations and profits”, he said. MFIL is expected to post Rs 168.1 crore sales turnover in 2000-01 against Rs 150.7 crore in the previous fiscal.
PTI |
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Talks failure dashes
sugar exporters’ hope Chandigarh, July 17 Official sources here said last year 32,000 quintal sugar was exported to Pakistan from Haryana by private traders following the Union Government’s decision to allow export of sugar. Two railway racks were loaded with sugar at the sugar mill at Shahbad and taken to Lahore through the Wagah border. More sugar was expected to be lifted by the Mines and Minerals Trading Corporation (MMTC), the official exporting agency of the Union Government, though it did not take place. While the reason cited by the MMTC was unavailability of railway racks, the actual reason behind the backing out by the MMTC was believed to be tension in Indo-Pak relations. The cooperative sugar mills of Haryana have achieved a record production of more than 32 lakh quintals of sugar in the current crushing season running from November 2000 to May 2001. The production was nearly 8 lakh quintal more than last year’s sugar production. The cooperative mills now have a stock of 32.83 lakh quintal, produce of the current year, plus an additional stock of 10 lakh quintal. |
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Industry regrets talks failure Ludhiana, July 17 The industrialists were expecting some opening in the trade between both countries, which would have benefited the local cycle and machine tool industry that could have captured the Pakistan market worth more than Rs 1,000 crore annually. Mr S.C. Ralhan, Chairman, Engineering Export Promotion Council said in case of the opening of the trade, the Indian cycle would have entered the Pakistan market in a big way. The average rate of a cycle in Pakistan is about Rs 3000 as compared to Rs 1200 in India. Similarly, the average rate of a good sewing machine in Pakistan costs about Rs 3000 as compared to Rs 2000 in the Indian market. The rates of machine and hand tools are said to be 20-30 per cent higher in Pakistan as compared to the domestic market. |
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Telco leads list of top 10 losers New Delhi July 17 Slowdown in traditional sectors of steel, textiles and automobiles inflicted heavy losses on companies belonging to most leading business houses including the Tatas, AV Birla, SK Birla, Lalbhai, the Mittals, Essar and the Singhanias, as per the latest available data. Telco, which tops the list of Top-10 losers with Rs 500.34 crore net loss in 2000-01, is the only company to slip into the red after posting Rs 71.20 crore profit in 1999-2000. Apart from Telco, the Lalbhai group’s flagship Arvind Mills is the only A-group company whose losses increased to Rs 384 crore last fiscal from Rs 271 crore net loss in 1999-2000. The steel sector was perhaps the worst hit as Lloyds Steel’s losses increased by 43 per cent to Rs 379 crore, while Essar Steel reduced net losses by 40 per cent to Rs 346 crore last fiscal as compared to a colossal Rs 581 crore in 1999-2000. Korean chaebol Daewoo Motors Indian subsidiary’s losses soared by a whopping 193 per cent to Rs 340 crore last fiscal as compared to Rs 116 crore in the previous fiscal. H.S. Singhania’s J.K. Corp was also in the red with over Rs 200 crore losses while Mittal’s Hughes Telecom reduced losses to Rs 209 crore last fiscal from Rs 270 crore in 1999-2000. The S.K. Virla group company Birla VXL’s losses increased significantly by 594 per cent to Rs 148 crore last fiscal from Rs 21 crore in the previous fiscal. Core Healthcare also posted losses of over Rs 150 crore last year, which is much less than Rs 340 crore loss during 1999-2000. Six out of the 10 companies increased their losses last fiscal, with Telco replacing Essar Steel as the leading loss making company. Telco’s net loss of Rs 500.34 crore last fiscal was, however, lower than Rs 581 crore loss of Essar Steel in 1999-2000.
PTI |
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Collateral free credit up to Rs 25 lakh for SSIs New Delhi, July 17 Clarifying the position to the members of the PHDCCI, Mr Devi Dayal said that collateral security and third party guarantee had been the biggest hurdle in the flow of credit to SSIs sector. With a view to removing this obstacle and ensuring hassle free credit, the Government of India in association with SIDBI had created a Credit Guarantee Fund Trust for small industries, with an initial corpus of Rs 125 crore. This has been now raised to Rs 2,500 crore enabling the SSIs to get collateral free credit up to Rs 25 lakh, a chamber press note said. Expressing concern over the decline Credit Deposit Ratio (CDR), Mr Devi Dayal called upon banks to take initiative to improve the CDR. The banks should look for new avenues of investment in areas such as agriculture, service sector and trade. However, the bankers should also keep close watch on the implementation of projects for which loans have been granted. The Secretary welcomed the PHDCCI idea to create the guarantee Fund to provide counter guarantee to banks to make up their losses in case of default by small and medium enterprises (SMEs). The borrowers demanded that working capital requirement should be assessed on genuine needs of business and not on maximum permissible bank finance. They also suggested that working capital finance for exports be taken out from normal assessment and interest rate both for pre and post shipment be reduced to 7 per cent with banks bearing Export Credit Guarantee Corporation (ECGC) premia. Some other suggestions to ensure adequate, timely and hassle free working capital finance to SSIs included a consensus approach between financial institutions and banks, appraisal exercise only by the lead bank along with second largest bank in the consortium, special discount to companies having ISO-1000 and ISO-14000, extension of Compromise Settlement Scheme of NPA by one more year and simplification of documentation and other formalities.
UNI |
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Haryana to sign
MoU with STPI Chandigarh, July 17 Stating this here today, an official spokesman said that the setting up of the Earth Station and STPI office would provide an impetus to the IT industry in Haryana by providing reliable high speed data communication facility as well as single window clearances required for their day-to-day operation. This would further boost future IT investments in the state. The state has formulated a comprehensive Information Technology policy with an objective to encourage the IT and related industry in Haryana. Also, the focus is on the development of related IT infrastructure conducive to achieving the said objective. The signing of an MoU for setting up of Earth Station and STPI office is a right step in this direction. The High Speed Data Communication is the best ingredient for IT industry. The present communication requirements of the IT industry in the region is met by VSNL from its Earth Stations at New Delhi and Noida. The units are being provided data communication linkages through radio links. This facility besides being costly also reduces the reliability of the link. More so, units have to go to Delhi or Noida for various day-to-day clearances from the office of STPL. |
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MoU on telecom Modi Rubber Symposium Customers meet Haldia Petro Auto industry |
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