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Note to Cabinet on petrol price hike
PSIEC woos defaulters with one-year amnesty
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Cellular subscriber base hits 60.3-million mark
Ratan Tata supports HPL shares allotment to IOC
Dabhol gets mega power project status
Irish firm buys Noon Products for £ 124 m
China permits yuan forward market
Space TV DTH venture may be delayed
Corporate News
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Note to Cabinet on petrol price hike
New Delhi, August 9 Meanwhile, the ministry has warned that state-owned Bharat Petroleum Corporation (BPCL), Hindustan Petroleum Corp and IBP will turn financially sick by next year as losses arising from freeze on fuel prices are set to erode their net worth. Petroleum Minister Mani Shankar Aiyar today said his ministry had forwarded the note relating to the hike in petroleum products prices and the decision would be taken by the Cabinet. “I can assure you that all information (about prices in the international market) has been sent to the Cabinet,” the minister said on the sidelines of a meeting with the US India Business Council Executive Mission to India. The government had allowed oil marketing companies on June 20 to increase prices of petrol by Rs 2.50 per litre and for diesel by Rs 2 per litre. Despite the hike, the oil companies claim that they were incurring cash losses and they have been demanding a further hike in the wake of rising global prices. Replying to a question on the possible cut in duties, Mr Aiyar said the Finance Minister would have to consider various factors including fiscal deficit before taking a decision on customs duty cut or excise duty reduction. On the steep hike in prices in the international market, the minister said apprehensions expressed one-and-a-half-years ago still persist but there was no shortage of crude oil in the international market. Forex reserves were also touching a high of $ 140 billion to withstand the rising prices, the minister added. IBP, a subsidiary of Indian Oil Corp, will be the first company to turn sick by September 2005, followed by BPCL which will take just 13 months from now go to BIFR while HPCL would be sick in 20 months, Petroleum Secretary S C Tripathi has written to the Cabinet Secretary B.K. Chaturvedi. IOC will be sick in 35 months from now if petrol, diesel, LPG and kerosene prices are not changed in line with the spurt in international oil prices, which touched a record $ 64 a barrel today. According to Mr Tripathi’s letter, IOC, which reported first-ever net loss of Rs 54.2 crore in April-June quarter, suffered an estimated loss (including depreciation) of Rs 744 crore in July alone. BPCL netted a loss of Rs 400 crore over Rs 431.3 crore loss in Q1 while the HPCL saw Rs 475 crore loss in July on top of Rs 507.89 crore net loss of April-June quarter. IBP, the letter said, had a net worth of Rs 324 crore as on June 30, 2005 and reported a loss of Rs 189 crore in July. The standalone fuel retailer, which reported a net loss of Rs 233.97 crore in April-June, is set to lose its net worth in next two months, a milestone which will take it to the Board of Industrial and Financial Reconstruction (BIFR).
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PSIEC woos defaulters with one-year amnesty
Mohali August 9 PSIEC had issued notices to the allottees of industrial plots at various focal points across the state for the recovery of additional cost of plots accruing from enhancement in land compensation awarded by the judicial courts. Many of the allottees, however, did not pay the enhanced cost and have been, over the years, incurring interest both on the principal amount and penalty. In certain cases this compounded interest is as high as 26 per cent per annum. However, as a part of the new scheme, a defaulter can settle his accounts by making payment of the enhanced cost (principal amount) along with simple interest calculated on the basis of the rates applicable under the respective terms and conditions of allotment up to a maximum of 15 per cent per annum (without compounding or penal interest). The defaulter can make this payment in four equated quarterly instalments. Sources added the scheme stands to benefit those industrial units the most that owe large amounts to PSIEC. Godrej, Mohali, for example, owes Rs 17 crore while Shivalik Telecom, Mohalic and Bharat Petroleumc Bathindac owe Rs 5 crore each to PSIEC. The Punjab Warehousing Corporation owes Rs 2 crore to the corporation. In fact, Mohali, Jalandhar extension, Jalandhar Leather Complex, Growth Centre Bathinda, Mandi Gobindgarh, Patiala and Ludhiana have the largest number of defaulters. Sources pointed out that this is the last such opportunity that is being offered to the defaulters who would face cancellation and resumption of their plots following the end of this scheme.
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Cellular subscriber base hits 60.3-million mark
New Delhi, August 9 Mobile operators offering services based on GSM technology netted 1.95 million subscribers during July, up 4.35 per cent over June. With this, the total GSM users reached 46.87 million at the end of last month, their representative body, Cellular Operators Association of India (COAI) said today. Rival CDMA operators added 5.35 lakh users in the reporting month, taking the total to 12.3 million CDMA mobile subscribers in the country, the Association of Unified Telecom Services Providers of India (AUSPI) said. The government has set a target of 250 million lines by December 2007 and of this, around 175 million will be mobile phones. The large number of additions is largely due to lower tariffs and competitive services being offered by mobile firms in the world’s fastest growing telecom market. The COAI said Bharti added 5.35 lakh users to reach a subscriber base of 12.79 million, capturing a share of 27.28 per cent of the GSM market. BSNL added 4.9 lakh users in July, taking the total to 10.72 million and a market share of 22.88 per cent. Hutch netted 4 lakh new users. With this, its total user base reached 8.84 million and a market share of 18.87 per cent. Among CDMA players, Reliance Infocomm accounted for most of the new additions. The firm added 3,60,110 customers and raised its mobile user base to 10.647 million, AUSPI said.
— UNI
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BSNL, Hutch cut broadband prices
Bharat Sanchar Nigam Ltd (BSNL) today announced a 50 per cent cut in broadband usage charges for its DataOne services whose users with home plan having bandwidth of 256 kbps connections will now have to pay Rs 250 per month instead of Rs 500 per month.
Simultaneously, BSNL introduced a new Business Plan of DataOne with an entry level tariff of Rs 700 for the 256 kbps connection which is lower than Rs 1,200 plan for business users. The new tariff is an Independence Day offer from BSNL and will be applicable from August 16, 2005 (midnight of August 15). Network service provider Hughes has also slashed its satellite broadband prices by 40 per cent with the introduction of five new high-speed service plans. The new service plans would give organisations the flexibility to select a scheme that meets their business requirement as they scale up the enterprise applications or number of users and will be operational from August 20, 2005, Hughes India said in a press note here today.
— Agencies
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Ratan Tata supports HPL shares allotment to IOC
Kolkata, August 9 Mr Tata, who had stepped down from the HPL board recently, said: “It was the best thing that has happened to Haldia Petrochemicals. “I fully support the move and hope that it would be vindicated over time,” Mr Tata told reporters here today. He said that IOC would make HPL a strong company and “the strength of the oil PSU would contribute to the strength of HPL...I think it is a very positive move.” Earlier, the Tata group, through Tata Motors and Tata Power held nearly 14 per cent stake in HPL. The stake had been divested to a large extent and the Tatas currently hold a nominal 3 per cent stake in the company. Addressing the 42nd Annual General Meeting of Tata Tea, Mr Tata said Tata Motors, one of the group’s prominent arms, was considering the Chief Minister’s proposal for setting up of an automobile plant in the state while Tata Power was awaiting a specific proposal from the state government for entering into power business in West Bengal. The company was also looking for investment in a coke oven plant in Haldia. Foraying further into the global tea business, Tata Tea has decided to invest Rs 500 crore for acquisition of companies in Latin America and the US. “We are looking at Latin America and the US for new markets. With the help of our large cash balance, we will be investing Rs 500 crore for acquisition of related business in tea and beverage segment,” he said. The company has at present established markets in the UK, US, Canada, Poland, Russia, West Asia, Australia, Bangladesh, Pakistan and South Africa.
— Agencies
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Dabhol gets mega power project status
New Delhi, August 9 The benefits extended to mega projects will be available to Dabhol plant subject to the condition that some power is sold to states other than Maharashtra. The EGoM has also decided to make a recommendation for customs duty waiver on LNG for the plant which will be forwarded to the Cabinet Committee on Economic Affairs. Finance Minister P Chidambaram had recently agreed on the need for duty waiver for all LNG plants due to the high price of gas. The Dabhol project will also get a 10-year tax holiday under 80 IA of the Income Tax Act applicable for greenfield projects. The EGoM has agreed to clear the exemption for the project. These benefits would ensure that the cost of power would be kept at Rs 2.30 per unit. Meanwhile, the government is also likely to revise its mega power project policy by relaxing the condition of minimum of 20 per cent inter-state sale of power.
— UNI
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Irish firm buys Noon Products for £ 124 m
London, August 9 The acquisition significantly enhances Kerry’s range of Asian foods, which are the most popular of the prepared meals sold in supermarkets. The Tralee-based company said the move represents a big expansion of its ready meals business, which last year accounted for about a third of its sales. The maker of Kerrygold butter is already one of the main suppliers of chilled and frozen meals to UK supermarkets including Tesco, Sainsbury’s and Marks & Spencer, most of which are sold under the stores’ own-brand ranges. Sir Gulam will stay on as non-executive chairman. Mr Frank Hayes, director of corporate affairs at Kerry, said, “this acquisition consolidates our position as leaders in the fast-growing Asian sub-category. People are looking for authentic, restaurant-quality foods and these meals meet the needs of both supermarkets and consumers.” Noon Products was founded by Sir Gulam Noon more than 15 years ago from a factory in Southall, west London. It now manufactures 2 million ready meals a week from three factories in Southall and has an annual turnover of more than £ 100 million. Meanwhile, a healthcare firm backed by Sir Gulam Noon is buying BioCare, one of Britain’s leading makers of natural and herbal remedies, at a cost of £ 16.1 million. Sir Noon has 10.7 per cent stake in NeutraHealth, the company that will take over BioCare, which sells over 170 products including vitamins, minerals and fish oils to health care professionals in the UK. The Birmingham-based company that started by distributing a single supplement was founded in 1985 by husband and wife John and Sharon Stirling. The duo will net an instant £ 14.1 million from the sale as well as £ 1 million .in NeutraHealth shares and £ 1 million .in shares or loan notes a year later. Sir Noon is putting £ 1 lakh of his own money into the deal and other members of his family are also making contributions.
— UNI, PTI
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China permits yuan forward market
Beijing, August 9 The long-awaited announcement by the People’s Bank of China will make it easier for banks to hedge the increased risks they are taking following Beijing’s decision on July 21 to abolish the dollar peg and let the yuan trade a bit more freely.
— Reuters
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Space TV DTH venture may be delayed
New Delhi, August 9 As per the application filed by Space TV with the Wireless Planning Commission
(WPC), it proposes to set up its earth station for uplinking from the VSNL complex in
Chattarpur, near Qutub Minar in South Delhi where VSNL has a hub. Significantly, a notification issued in November 1997 by the Ministry of Urban Affairs and Employment — now known as the Ministry of Urban Development — states that the “land use of 158 acres of land
belong(ing) to Videsh Sanchar Nigam Limited… is proposed to be changed from “rural use” to “public and semi-public (institutional) use”. While no comments were available from VSNL despite repeated attempts, experts tracking the development in the country’s DTH sector aver that this technicality may create a few hurdles in the original plans of Space TV. As per the application filed with the
WPC, Space TV had set the target of putting its DTH service on steam by November 1, 2005. The modification in the Master Plan of Delhi, effectively would mean that the complex in Chattarpur technically cannot be utilised for commercial benefits of any entity, experts said. Space TV had recently received the Letter of Intent
(LoI), which would later be followed by grant of a formal license, from the government for rolling out its proposed DTH venture involving an estimated investment of Rs 16 billion.
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Corporate News
Kolkata, August 9 The company, which has been exporting fruit pulp under the Maaza brand, would launch its fruit juices under ‘Alfa’ brand in the country, company CMD Ramesh Chauhan told newspersons here today. Stating that fruit juices were the next in the line of preference after packaged water, he said: “We will launch five or six flavours under Alfa brand in the next one year. We have launched mango juice for test marketing in Tamil Nadu.” The Rs 350 crore company, which has set up a Rs 50 crore plant in Chittor in Andhra Pradesh for fruit pulp production for exports, has earmarked another Rs 100 crore for upgradation and a new unit in eastern or northern region.
Titanium Card
HDFC Bank and payment solution provider MasterCard International today launched ‘Titanium Credit Card’ for special segment of customers with interest on outstanding amount at 1.95 per cent per month and surcharge waiver across all petrol pumps. “The HDFC Bank MasterCard Titanium Credit Card has been launched to cater customers who do not just demand exclusive privileges and services, but are used to getting what they want. The card is priced at Rs 3,000 and Rs 2,500 for existing bank customers,” HDFC Bank Vice-President and Head (Credit Card) Pralay Mondal told reporters here today.
BEML IPO in Sept
State-owned Bharat Earth Movers Ltd (BEML) is hoping to raise around Rs 300-350 crore through its public offer of 70 lakh equity shares which is likely to come out in September for partly funding its expansion plans and diversifying into new areas like contract mining. “The proceeds of the IPO would be used for improving existing machinery, upgrading our in-house metro infrastructure, investment in the Mumbai metro consortium and contract mining operations,” BEML CMD V. Natarajan told reporters here today.
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