B U S I N E S S

Decision on Air-India next week
New Delhi, September 10
Even as the Tata’s searched for a new strategic partner in its bid to take charge of the Air-India, Civil Aviation Minister Shahnawaz Hussain today said that a final decision on disinvestment in the country’s international carrier would be taken next week.

Bharti Televentures to offer 10 per cent stake via IPO
New Delhi, September 10
Bharti Televentures is likely to offer 10 per cent equity to public via its proposed over $ 200 million initial public offering in the current fiscal. “Bharti Televentures would offer 10 per cent stake through issue of fresh equity, via the public offer. The company would file offer document with SEBI this month,” Bharti sources said.

Improve milk products: seminar
Ludhiana, September 10
India has remained at number one position in milk production in world for the past few years. This year it produced about 81 million tonnes as compared to 76 million tonnes in the USA. However, the quality of milk produce has been far below the international standards. 

IOC to shelve Panipat refinery expansion
New Delhi, September 10
Indian Oil Corporation may shelve the Rs 14,000 crore Panipat refinery expansion and petrochemicals project if Haryana Government fails to withdraw the 4 per cent entry tax levied on crude oil.

RBI-Sebi panel to review equity norms
New Delhi, September 10
An RBI-Sebi technical committee will review guidelines on bank financing of equities and investment in shares every half year and recommend necessary changes in the regulatory framework.

Uttaranchal yet to mobilise resources
Dehradun
The Nityanand Swami led BJP government in Uttaranchal has failed to cash in on special economic status and the package from the Centre. Although the initial process of granting special economic status was started by the Central government at the beginning of the current financial year, there has been no follow-up by the state government.

ANALYST’S DIARY

Not too many investors for ‘filmi’ companies
Remember the media and entertainment stocks that were touted as successors to the booming IT stocks in the good old ICE age. Well two high profile entertainment stocks that we had reviewed closely at the time of their IPO’s and tracked thereafter are Mukta Arts and Tips Industries. Methinks it is time for a flashback, true to the ‘filmi’ traditions of these companies.

Decision on Air-India next week
Tribune News Service

New Delhi, September 10
Even as the Tata’s searched for a new strategic partner in its bid to take charge of the Air-India, Civil Aviation Minister Shahnawaz Hussain today said that a final decision on disinvestment in the country’s international carrier would be taken next week.

The Civil Aviation Minister met Disinvestment minister Arun Shourie this morning and reviewed the progress made on the disinvestment front in Air-India. The meeting was held specially in the backdrop of Tatas being left as the single bidder after Singapore Airlines decided to opt out from its partnership with the industrial house.

“I met Disinvestment Minister Arun Shourie, this morning and discussed various aspects. A decision on Air-India will be taken after Ratan Tata communicates his position,” Hussain said after the meeting.

As per reports Tatas have got in touch with a hosy of airlines for forming a new consortium. As per reports airlines like United Airlines and Air France-Delta are being seen as the possible partners for the Tatas to form a new consortium.

“Tatas are still in the race for A-I. They are in search of a new partner. A final decision on the subject will be taken only after meeting with Ratan Tata next week,” the minister said.

Virtually ruling out rebidding for Indian Airlines, where both the shortlisted bidders Hindujas and Videocon have opted out of the race, Hussain said that for the time being, he would concentrate on reviving and strengthening of the airline.

“Disinvestment of A-I is not on now. We first want to make the airline competitive and strengthen it. The process will help increase the value of government equity,” he said.

Stating that he would meet Prime Minister Atal Behari Vajpayee in a day or two, he said, he would strive to take the Civil Aviation Ministry to new highs by enforcing discipline and blocking all the revenue leakages like free loading in the two airlines.

Stating that disinvestment was not his concern and that he would fully cooperate with Arun Shourie on the issue, he said that his priority was to make the PSUs under him fully viable commercially.

“Prime minister has entrusted me with the responsibility. I represent both the youth and minority in the government and therefore I am taking the responsibility very seriously,” he said while asserting that he would not work as a “dummy minister”.

“I have had a wide ranging experience in my earlier ministries. I will bank on the same to make civil aviation a success story,” Hussain, the youngest Cabinet Minister at 32 years, said when asked about reports that his youth would come in the way of handling civil aviation. 

Bharti Televentures to offer 10 per cent stake via IPO

New Delhi, September 10
Bharti Televentures is likely to offer 10 per cent equity to public via its proposed over $ 200 million initial public offering (IPO) in the current fiscal.

The company currently operates its cellular services in Himachal Pradesh, Delhi, Karanataka, Andhra Pradesh, Chennai and Kolkata. PTI

Improve milk products: seminar
Tribune News Service

Ludhiana, September 10
India has remained at number one position in milk production in world for the past few years. This year it produced about 81 million tonnes as compared to 76 million tonnes in the USA. However, the quality of milk produce has been far below the international standards. The annual milk losses due to milk getting sour is estimated at around Rs 4000 crore annually, which could be easily saved by improving the sanitary condition in dairies. The quality improvement of milk products is the need of hour to remain competitive in the domestic and international market.

These views were expressed by national dairy experts in the two-day seminar on quality assurance in dairy industry concluded here yesterday. The seminar was organised by the Indian Dairy Association (North zone) in collaboration with the Milkfed Punjab.

Mr Animesh Banerjee, president, the Indian Dairy Association, Mr R.C. Chauhan, General Manager (QPM), NDDB, Anand presented a paper on the need for clean milk production and its advantages. Mr A. Long, factory manager, Nestle India, Moga, Dr R.S. Khanna, General Manager, Gujarat Coop. Milk Mktg Fed, New Delhi, Prof R.S. Sahota, PAU, and Dr G.S. Rajorhia, ex-principal scientist, NDRI, Karnal also participated in the discussion.

IOC to shelve Panipat refinery expansion

New Delhi, September 10
Indian Oil Corporation (IOC) may shelve the Rs 14,000 crore Panipat refinery expansion and petrochemicals project if Haryana Government fails to withdraw the 4 per cent entry tax levied on crude oil.

While the design for the refinery expansion project has been completed and bids for construction have been received, IOC is not going head with the award of contracts as the Haryana Government is sitting on its request for the crude oil entry tax waiver and sales tax incentives, Pathan said. PTI

RBI-Sebi panel to review equity norms

New Delhi, September 10
An RBI-Sebi technical committee will review guidelines on bank financing of equities and investment in shares every half year and recommend necessary changes in the regulatory framework.

“The technical committee will review the guidelines in the light of developments in the market and consequent changes required in the regulatory framework will be recommended,” the RBI said in response to queries from JPC probing the stock scam.

The committee will review the guidelines allowing banks to take an exposure of 5 per cent of total advances, in consultation with banks and other market participants, the apex bank said.

The decision comes in the wake of alleged violation of the RBI’s prudential investment norms by Bank of America, Karnataka Bank, Development Credit Bank, HDFC Bank, Centurion Bank and Bank of Madura, Global Trust Bank and UTI bank.

The RBI informed the JPC that it had asked Bank of America, Karnataka Bank and Development Credit Bank to explain why their equity exposure crossed the 5 per cent ceiling during the first half of 1999-2000.

Since excess exposure in the case of Karnataka Bank was only Rs 21.23 crore while that of Bank of America at Rs 1.34 crore, the RBI did not take any action against them. PTI

Uttaranchal yet to mobilise resources
Kulwinder Sandhu

Dehradun
The Nityanand Swami led BJP government in Uttaranchal has failed to cash in on special economic status and the package from the Centre. Although the initial process of granting special economic status was started by the Central government at the beginning of the current financial year, there has been no follow-up by the state government.

Uttaranchal is yet to mobilise its scant resources, while it has inherited a Rs 1,200 crore deficit from the mother state.

When the CM pressed for an economic package during Mr Yashwant Singh’s recent visit to Dehra Dun, the Union FM said the state government must prepared a blueprint outline its requirements before seeking a special package.

Mr Sinha also gave a blow to the state government’s hope for getting financial help from the 11th Finance Commission by stating that the Five-Year Plan was prepared much before Uttaranchal came into being. Hence any such plea to get financial help from the 11th Finance Commission cannot be entertained now, he told the CM.

The Opposition is now accusing the state government of not doing its home work properly before seeking an economic package. “The BJP Government in Uttaranchal stands exposed in the light of the Union Finance Minister’s statement”, says Mrs Indira Hriyadesh, CLP leader.

“The CM and his flock of ministers have made a mockery of themselves by not putting forward any blueprint before seeking an economic package. The state exchequer is empty. The government is facing difficulties in giving salaries to the employees. It has failed to secure an economic package from its own party/government at the Centre”, says Mr Ambirish Kumar, senior SP leader and MLA from Hardwar.

The opposition parties, particularly the Congress, are claiming that the Centre has stopped the allocation of funds to Hill Development Council, which the hill region was getting till the formation of the new state.

The Swami government is also under fire for not setting the power dispute with Uttar Pradesh. More than 10 hydel power projects in the state are poorly managed and require urgent repair work. Due to lack of repair, a couple of months back the Tiloth power house in Uttarkashi was submerged in water, failing power generation. Uttar Pradesh controls the power projects stating that it has invested heavily in them.

Uttaranchal Finance Minister Ramesh Pokhriyal Nishank claims the state has registered a revenue of Rs 235 crore during the last three months which is an “achievement on its own”. “Our resources are increasing. So is the revenue”.

ANALYST’S DIARY

Not too many investors for ‘filmi’ companies
Ashok Kumar

Remember the media and entertainment stocks that were touted as successors to the booming IT stocks in the good old ICE age. Well two high profile entertainment stocks that we had reviewed closely at the time of their IPO’s and tracked thereafter are Mukta Arts and Tips Industries. Methinks it is time for a flashback, true to the ‘filmi’ traditions of these companies.

Mukta Arts’ biggest plus, which ironically becomes its biggest risk too, revolves around the persona of its promoter Subash Ghai. His goodwill and reputation in the film industry ensures that the films right’s — screening, music and even advertising are presold. Here’s what we had to say on listing of the stock.

With Ghai’s latest film ‘Yaadein’ readying for a mid-2—1 release, there is a considerable build up of expectation. If the film succeeds at the box-office, it could translate into windfall gains for the company in the form of even better rates for next film’s rights. On the other hand, if the film were to fail at the box office, where fortunes are even more fickle than at the bourses, it would definitely be a major setback for this compay as its payback cycle of 18 months would be even further stretched. An ace up the company’s sleeve is the film content library it owns, and can be cashed in due course.

Well, Murphy’s law worked here and ‘Yaadein’ has failed to measure upto expectations thus setting the clock back for the company by another 18 months or so. Interestingly, the issue price of Mukta Arts had already factored in this movie’s box-office success, which is why its non-success has brought its share price down to the double digit level. It currently trades close to its 52 week low. It seems the showman and his company’s shareholders are learning the harsh ways of the bourses the hard way round.

Not too different is the story of Tips Industries. One must understand here that its business is a judgement based one, where the company or to be more precise, its management takes a call on whether to acquire the music rights of a certain film or singer. Now, given that the judgement here is based one, where the company or to be more precise, its management takes a call on whether to acuqire the music rights of a certain film or singer. Now, given that the judgement here is based more on skill rather than any scientific basis, the risk element looms larger, although it must be admitted that the returns therefrom too could be substantial provided the dice rolls right. Let us once again delve into a flashback.

The fact that the management of this company has often been accurate in judging the potential of a film’s music is comforting, although by no means a guarantee of continued success. Again, the company has proven strength in not only selecting the right kind of music, but also its music promotion.

With the growing overseas market promising to be a potential boon for Indian music companies, the company seems well-positioned. On the flip side, however, in this time and age where the market has begun viewing corporate governance as one of the parameters of acceptance at the bourses, the fact that one of the promoters has been charge-sheeted in murder case is hardly likely to be comforting although there is some merit in the management’s contention that the who’s who of the Indian film industry might not have staked the amount of money it had in its dealings with the company if it felt that there was any major risk involved here.

Murphy’s law struck here too and the company made a series of bad calls on the film music front, which in turn has sent the market expectations of its profitability projections haywire. This stock too is now down to double digits and quotes close to its 52 week low. In short, the musical notes seem to have gone awry.

So given this dismal backdrop, how many of you might queue up to invest in the next ‘filmi’ company that comes along, maybe ABCL? No too many, I am sure.

BIZ BRIEFS

Re slumps to all-time low
Mumbai, September 10
The rupee slide against the US currency continued unabated and it slumped to a new all-time low at Rs 47.3450/3550 per dollar at the interbank foreign exchange (forex) market today. PTI

Bank of Punjab
Chandigarh, September 10
Bank of Punjab opened its branch at Batala today which is in line with the Bank’s marketing strategies to strengthen its customer base in the Northern India. Mr Tejbir Singh, Executive Director, Bank of Punjab said, “Batala is one of the key markets of the northern India predominant with small scale industries, and we are confident our network of banking and ebank centers will benefit the traders, business communities and the small scale industries of the region. TNS

SBP branch
Chandigarh, September 10
Mr Sandeep Hans, SDM, Phillaur, today inaugurated total computerised working of Phillaur branch of State Bank of Patiala. Mr S.C. Madan, AGM, said the bank will install ATMs at six branches shortly in the zone. TNS

Cathy Cannula
Chandigarh, September 10
Hindustan Syringes and Medical Devices (HMD), manufacturers of syringes and medical equipment, has launched the most advanced I.V. Cannula in India — the Cathy I.V. Cannula. TNS

Nilkamal Plastics
Mumbai, September 10
The shareholders of Nilkamal Plastics Ltd have cancelled the Rs 1.20 per share dividend recommended by the board of the company for the financial year 2000-01. The shareholders unanimously called off the dividend at the annual general meeting held last week. PTI

Arvind Mills
New Delhi, September 10
Arvind Mills Ltd has received DuPont’s accreditation for its Lycra Assured Programme and will now work closely with the latter’s apparel and textile sciences for innovations in Lycra. PTI

ICICI Bank
New Delhi, September 10
Visa International and ICICI Bank today announced a pilot programme for facilitating e-commerce in the country. ICICI Bank would be the first bank to employ Visa’s “3-D Internet payment security protocol” to create a better, safer online shopping environment. PTI

J K Corp
Chandigarh, September 10
JK Corp Limited has started its restructuring as sanctioned by the Orissa and Gujarat High Courts. The scheme envisages debt and business restructuring of the company including transfer of JK Paper Mills Orissa to the Central Pulp Mills. JK Corp will now be a focused cement company with a capacity of 2.2 million tonnes per annum. TNS