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Govt concerned as inflation hits 6 pc
Auto Expo 2004
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Allow carry forward on pre-paid cards: TRAI
Idea Cellular to buy out Escotel Mobile
PUNWAC closed down
TV Today listed at 220
PC prices to go down
New FDI limit opens new vistas
HDFC nets Rs 182 crore Mumbai, January 16 HDFC has posted a net profit of Rs 182.81 crore for the quarter ended December 31, 2003, as compared to Rs 146.65 crore for the quarter ended December 31, 2002. Total income has increased from Rs 734.94 crore in the quarter 3 in 2002 to Rs 747.22 crore in the quarter ended December 31, 2003.
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Govt concerned as inflation hits 6 pc
New Delhi, January 16 “Yes it is (a matter of concern). The rising inflation was due to cyclical factors. But we will take corrective measures,” Finance Secretary D.C. Gupta told reporters here. He, however, declined to elaborate on the measures to be taken, saying he was yet to analyse which factor had led to the increase in Wholesale price Index (WPI) inflation and said “watch for some time.” He, however, said oil prices was one of the reasons for the increase in inflation. Though he would not hazard to guess what would be the level of inflation, Gupta said the general price level would start falling after January. Increasing prices of commodities, both agricultural and industrial along with diesel and petrol, pushed up inflation in the first week of January to a 35-week high of 6.09 per cent as against 3.78 per cent in the year-ago period. The WPI inflation rose for the eighth consecutive week for the period ended January 3, by another 0.34 per cent from the week-ago level of 5.75 per cent, even as Finance Ministry and RBI hoped it will soon taper off. The highest level so far in this fiscal was 6.47 per cent during the week ended April 12. “Inflation will start falling and is expected to be in the range of 4-4.5 per cent by the end of the current fiscal,” RBI Governor Y.V. Reddy said in Mumbai. The RBI said today despite the cut in customs and excise duties, the Centre’s fiscal and revenue deficit situation for 2003-04 will be better than the Budget estimates and the government will not require to resort to additional borrowings from the market. “Inflation will start falling and is expected to be in the range of 4-4.5 per cent by the end of the current fiscal,” RBI Governor Y.V. Reddy said. About the impact of the cut in customs duties and other sops on the financial condition, Reddy said “we had discussions with the Finance Ministry on this issue and as per the current assessment, revenue and fiscal situation will be better than what is estimated in the Budget”. The RBI does not expect any additional borrowings by the government despite a range of cuts announced last week, Reddy told reporters on the sidelines of the financial services convention, organised by the Bombay Management Association, where former RBI Governor Bimal Jalan was felicitated. Inflation, which is currently ruling high, is expected to fall and should range between 4-4.5 per cent by the end of this fiscal, he said.
— PTI
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Nissan to re-enter India
New Delhi, January 16 “With X-TRAIL, which will hit the market in mid-2004, we want test the Indian market,” Nissan Motor Co General Manager Yasuaki Hashimoto told newspersons here today. “This is the beginning and we have tied up with local dealers in Delhi, Kolkata, Mumbai and Chennai, who will be selling the X-TRAIL. When Nissan rolls out X-TRAIL, it will be company’s second coming to India. In the 1980s, it had tied up with Hyderabad-based Allwyn for manufacturing small trucks. Hero Motor’s new
plant at Manesar
Hero Motors today said it would invest Rs 150 crore to set up a new plant at Manesar in Haryana for producing scooters and motoscooters in collaboration with Aprilia of Italy and the first product would hit Indian roads by October this year. Hero Motors Managing Director Pankaj Munjal said this after unveiling two vehicles that the company would launch in association with the Italian company. The first vehicle sporting Hero-Aprilia brand, Sonic, will hit the Indian roads in October and will be an ungeared scooter, with an engine capacity of 75cc and 90 cc. Sonic will be followed by a motoscooter, SR 50, with a 125 cc engine. While design for both vehicles has been provided by Aprilia, they are being fully built in India. “The level of indigenisation is more than 99 per cent,” Mr Munjal said.
Volvo’s no to CNG
buses in India
The Indian subsidiary of Volvo, one of the leaders in the CNG-run buses worldwide, has stated that it would not roll out such buses in India in the distant future. Volvo India, which announced the launch of B7R luxury inter-city for the North India at the Auto Expo, said since compressed natural gas was not available throughout the country and the company’s existing buses were plying on long routes, it would not introduce CNG-driven buses.
Bajaj Tempo to make trucks
Announcing that it would enter the heavy commercial vehicle (HCV) segment in the next 12 months, following its technology tie-up with MAN of Germany, Firodias-run Bajaj Tempo Ltd (BTL) today said it would be investing Rs 400 crore to set up two manufacturing facilities for producing vehicles and engines. Sites are under consideration at Chakan near Pune and Pithampur near Indore for producing engines and vehicles, respectively. The company, which currently has four product lines in light commercial vehicles, utility vehicles, three-wheelers and tractors, said its trucks would be in the range of 16-50 tonne capacity.
— TNS, UNI
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Allow carry forward on pre-paid cards: TRAI
New Delhi, January 16 “The carry forward of unused balance to pre-paid subscribers has to be allowed during grace period (the period during which carry forward facility is available) applicable at the time of recharge irrespective of subsequent downward revision in the grace period,” a TRAI release said here. The operators would be required to make refunds to subscribers of the amounts forfeited due to the reason that the applicable grace period was revised after the contractual date, it added. The telecom regulator asked the operators to comply with the directive and send compliance report within 30 days. The tariffs would now be required to be implemented within seven days of implementation.
— PTI
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Idea Cellular to buy out Escotel Mobile
Hong Kong, January 16 Escorts Ltd., an Indian conglomerate, will also sell its controlling 51 per cent stake in New Delhi-based Escotel to Idea Cellular, First Pacific said in a legal notice. It didn’t disclose the price for that stake. Escotel is the seventh-biggest of 12 cellular communications providers in India, with about 8,26,000 customers. It lost $ 13.4 million in 2002 and has a negative net asset value of $ 324.9 million. Idea Cellular’s main corporate office is in Pune. First Pacific, a property-to-telecommunications conglomerate, said it remains committed to the telecommunications business in Asia but felt that Escotel was too small in the “increasingly competitive” Indian market. The sale of the 49 per cent stake is subject to approval by its shareholders and is expected to be completed in the second quarter of this year, First Pacific said.
— AP
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PUNWAC closed down Chandigarh, January 16 Talking to TNS, Ms Vini Mahajan, Director, Punjab Disinvestment Commission, said , the losses of the corporation till 1998-99 were Rs 624.26 lakh. Since the sale of assets, realisation of dues and discharge of liabilities of the corporation had been at a standstill for the past 6-7 years, the decision to close it down remained in abeyance. The Disinvestment Commission had directed the administrative department to take steps to close down the corporation. Engaging an Adviser, preferably a chartered accountant, to expeditiously prepare pending balance sheets, quick disposal of the assets of the corporation so as to take care of the obligations or liabilities shown are the steps proposed. The corporation was also asked to approach the Advocate General and district attorneys for finalising pending legal cases and for out of court settlements. The services of an arbitrator should also be availed for expeditious finalistion of awards in the pending arbitration cases.
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TV Today listed at 220
New Delhi, January 16 Aroon Purie’s TV Today got listed on the Bombay Stock Exchange this morning at an opening price of Rs 220 per share, which is Rs 125 higher than the highest bid price. The company had made an initial public offer through the book building route in December 2003. It owns Hindi news channel Aaj
Tak, weekly magazine India Today, English news channel Headlines Today and business weekly Business Today among other publications.
— PTI
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PC prices to go down New Delhi, January 16 This followed the tax cuts announced on January 8 where the government had announced a cut excise duty to 8 per cent from 16 per cent and removed the 4 per cent special additional duty on computers. Dell Computers today announced a price reduction of up to 11 per cent following the customs duty reductions announced by the government last week.
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New FDI limit opens new vistas
New Delhi, January 16 The fallout of these decisions are bound to be widespread and deeprooted and likely to have a tangible effect on the economy and the common citizenry. Take the petroleum sector for instance. Foreign oil majors, such as Shell, can now set up 100 per cent subsidiaries in the country to set up their own distribution network. And, on paper at least, one can envision a situation where petrol filling stations of several multi-national companies will dot highways and metropolises. The decision also has a not-so-explicit fallout for the disinvestment process of oil public sector undertakings (PSUs). For PSUs, the 26 per cent cap for foreign investment remains as it was. Effectively, this means that foreign oil majors cannot independently bid for state-owned PSUs unless they were to tie up with some domestic company. It is being seen by many as allowing FDI in the petroleum sector directly, and yet creating stringent
conditions for them to move in by acquiring in-built marketing infrastructure. Invest and create your own infrastructure but you cannot go on a whole-hog buying spree seems to be the message to the world. No tangible benefits, however, are likely to accrue in the immediate aftermath as foreign investors are not queuing up to enter the oil marketing arena. The more important facet, however, pertains to the oil exploration sector, a segment of such immense strategic importance that it had caused a vertical split both within and outside the government on disinvestment related discussions. The decision to allow 100 per cent FDI in this sector clearly shows that the government is not shying away from inviting foreign capital even if it might mean sharing information on strategic importance such as satellite imagery and other aspects. The thinking within the government appears to be that these long gestation projects will have immense multiplier effects across the economy besides fattening the forex coffers. The decisions pertaining to banking sector are equally sweeping and likely to have more immediate effect on the way the industry functions. For one, the FDI cap in the banking sector has been increased to 74 per cent from the existing 49 per cent. But the FII component has been effectively reduced as the new FDI ceiling of 74 per cent includes IPOs, private placements, ADRs/ GDRs and acquisition of shares from existing shareholders. However, for those banks which also have an insurance arm, the FDI cap remains pegged at 26 per cent, as mandated by the Insurance Regulatory Development Authority (IRDA). From an industry perspective, the decisions could have far reaching consequences as these would open up the sector for acquisitions of domestic banks through Indian subsidiaries of multinational banks. There are a few caveats though. Credit rating of entities making FDI has been made mandatory. And although the FIPB route has been done away with, prior approval of the RBI has been retained. A restructuring may also take place in the insurance industry. The new guidelines impose fresh restrictions on the level of investment made by foreign insurers. Foreign companies, which had tied up with domestic banks to establish an insurance joint venture, now will be governed by a new FDI cap. Their equity holding in the domestic bank will be accounted for while arriving at the 26 per cent insurance cap. All
in all, the widening of the FDI road to these sectors are sort of an
open invitation to foreign capital to make the most of the Indian
economy. Whether, adequate checkposts have been put in place is the
critical question. And the government should have answers ready for a
political backlash that will surely follow.
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HDFC nets Rs 182 crore
Mumbai, January 16 Total income has increased from Rs 734.94 crore in the quarter 3 in 2002 to Rs 747.22 crore in the quarter ended December 31, 2003. Meanwhile, giving cumulative performance for the nine months ended December 31, 2003, HDFC said its approvals during the period aggregated to Rs 10,390.01 crore as compared to Rs 8,004.82 crore during the corresponding period in the previous year, representing an increase of 30 per cent. Disbursements during this period amounted to Rs 8,345.83 crore as compared to Rs 6,491.46 crore during the corresponding period in the previous year, showing a rise of 29 per cent. Approvals and disbursements in respect of individual loans were higher by 33 and 28 per cent, respectively, as compared to the corresponding nine months in the previous year. Its loan portfolio, inclusive of investment in preference shares, debentures and inter-corporate deposits for financing real estate projects, as on December 31, 2003, amounted to Rs 26,429 crore as compared to Rs 21,184 crore as on December 31, 2002, accounting for an increase of 25 per cent. Gujarat Ambuja
net drops
Gujarat Ambuja Cements (GACL) has posted a net profit of Rs 59.54-crore for the quarter ended December 31, 2003, as compared to Rs 60.32 crore for the same last fiscal, reflecting a decrease of 1.29 per cent. Informing the Bombay Stock Exchange, the company said its total income has decreased from Rs 443.87-crore in the December quarter of 2002 to Rs427.20-crore in the quarter ended December 31, 2003. While the turnover is up 4 per cent at Rs 434.44 crore during the quarter as compared of Rs 419.34 crore during the corresponding quarter of the previous year. The operating profit was Rs 112.61 crore as against Rs 140.45 crore in the corresponding quarter of the previous year. Interest cost came down to Rs 22.11 crore as against Rs 26.11 crore, a decrease of 15 per cent.
— UNI, TNS
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