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WB expects India to grow by 8 pc
FinMin charts 7-point agenda for banks
HC reserves order on RIL demerger
Bharti Telesoft offloads 10 pc stake
Mallya to outbid others to buy Air Sahara
LG to make CDMA cellphones in India
Ansals plan three malls in Punjab
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SC admits sebi appeal on UBS
Silver, gold at new high
HAL, L&T plan jv
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Intel to invest $1 billion
New Delhi, December 5 He disclosed that the company was holding talks with the Indian government to set up a chip manufacturing facility in the country. “Intel’s $1 billion-plus investment roadmap includes plans to invest $800 million for the next five years to expand research and development centre in Bangalore in addition to marketing, education and community programmes,” Mr Barrett said at a press conference here. The company will also set up an India-specific venture fund with a corpus of $250 million. The fund will invest in companies engaged in cellular and broadband applications, wireless technologies, software and hardware design and e-commerce, he said. “We will grow our local operations, boost venture capital investment and work closely with the government, industry and educators to increase the impact of the country’s Information and Communication Technology,” he added. IT minister Dayanidhi Maran welcomed the $1 billion investment by Intel in India, saying it would boost the IT sector of the country and sought future cooperation of Intel in promoting IT. He also hailed the company’s decision to set up a venture fund for India. Finance Minister P Chidambaram said the VC fund would give a headstart to entrepreneurs engaged in frontline R&D and with Intel backing, this would be a win-win situation for both. Mr Barrett, however, remained non-committal on the company’s plans for a chip manufacturing plant in India, saying it was involved in “pragmatic” discussions with the government and at this point of time it was not appropriate to say anything. “We are still in discussion with the government on the possibility of setting up a manufacturing plant in India. At this point of time we are not ready to announce anything,” he said. The investment would focus on expanding the research and development centre in Bangalore, in addition to marketing, education and community programmes. This also includes significantly increasing the headcount in Bangalore. However, Mr Barrett did not specify the exact number to be raised. Intel’s development centre in Bangalore designs and develops software to power chips that drive computers and high-end networks for Internet-based applications. “The fund will also selectively invest in technology-oriented companies that target the overseas markets,” Mr Barrett said. Intel has, since 1998, invested $100 million in 40 Indian companies, including NIIT, Rediff, Sasken, Futuresoft and Tejas Networks.
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WB expects India to grow by 8 pc
New Delhi, December 5 Talking to reporters on the sidelines of a micro-finance conference, World Bank Vice-President (South Asia) Praful Patel said: “The overall economic situation is very positive. There is a very good chance of the economy to grow by 8 per cent this fiscal.” However, the government should open up more sectors to foreign direct investment, encourage private sector participation and improve infrastructure. Referring to Prime Minister Manmohan Singh’s recent remark that India should target 10 per cent growth in the next three years, Mr Patel said, “The distance of 8 to 10 per cent is very much achievable.” India’s GDP grew by slightly higher than 8 per cent in the first half of 2005-06, with a booming manufacturing and services sector. To sustain the present growth momentum and move up to a higher growth trajectory, he said the government needed to expand the role of the private sector and encourage more FDI. Citing the success stories of East Asian “tiger” economies, he said those countries were like India some decades ago but these carried out rapid infrastructure development and India should do the same. The government should encourage public-private partnerships for infrastructure development. To attract more FDI and private participation, he said the government should allow higher user charges and not reverse its policies for private players. The government should also make efforts to improve productivity, build rural infrastructure and step up public investment in agriculture, he said. The government on Monday constituted a group of ministers to study FDI norms and suggest rationalisation of caps in various sectors to attract foreign investments to push GDP growth. The GoM, headed by Union Agriculture Minister Sharad Pawar, would cover all sectors that are currently receiving FDI. The GoM would not cover FDI in retail as no decision has yet been taken by the government to open this sector to foreign capital. The members of the GoM include Finance Minister P. Chidambaram, Commerce Minister Kamal Nath, Communications Minister Dayanidhi Maran and Mines Minister Sisram Ola. — TNS
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FinMin charts 7-point agenda for banks
New Delhi, December 5 Since implementation of the new norms would necessitate greater capital requirement, the ministry has also asked the Reserve Bank of India (RBI) to come up with a guideline by December end for new hybrid instruments that could be treated as capital, informed source said here today. The ministry has circulated among bankers a set of steps for estimating the capital requirement in consonance with the risks and to align with Basel-II norms. “Banks have been asked to start a new rating model to measure probability of default,” the source said. Since Basel-II norms envisage providing for credit, market and operational risks, banks have been told to track those risks minutely. Banks will also have to put in place a “score-card approach” for further improving control systems and upgrading tracking system for operational risks. Though some of the banks have effective treasury management team, the ministry has asked all banks to ensure an active portfolio management. Moreover, sources said banks have been asked to estimate two new parameters—Loss Given Default (LGD) and Exposure at Default (EAD). A model for Risk Adjusted Return on Capital (RAROC) based pricing has also been mooted for banks instead of the present practice of a mere return on capital-based pricing mechanism. Banks will also need to make an estimation of the economic capital. The new rating model to assess loans would increase the risk weightage to 150 per cent for some assets while it may be lower than 100 per cent for home loans. This means that banks have good quality assets will have to make lower provision for loans while other banks will have to garner more capital.
— PTI
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HC reserves order on RIL demerger
Mumbai, December 5 The order was reserved by Mr Justice Nishita Mhatre after arguments by RIL and shareholder Kalpesh Bharatkumar Mankad, who is opposing the petition, concluded today. Mr Mankad argued that RIL had indulged in an unfair practice towards its shareholders and saw the demerger scheme as more of a kind of family arrangement than a business separation. He submitted that the committee formed under the chairmanship of retired High Court Judge M.L. Pendse had not disclosed to the court the objections filed by him during the extraordinary general body meeting of RIL held on October 21. RIL has sought dismissal of the intervening application of the shareholder, opposing the scheme, saying that he was holding to ransom the entire process of demerger of RIL having around 20 lakh shareholders. RIL further argued that the objections raised by the intervening shareholder were speculative in nature. Mr Mankad said in an affidavit that despite demerger of assets worth Rs 19,119.54 crore, the description given by RIL did not specify which assets and liabilities would be transferred to the new entities and that had created doubts in the minds of the shareholders. He further said the proposed demerger scheme be held in abeyance until the action taken report of corporate governance issues raised by RIL’s Ex-VC and MD Anil Ambani was put before the high court and scrutinised by SEBI and the Department of Company Affairs (DCA). Earlier, Mukesh Ambani-controlled RIL had moved the court on September 13 seeking its approval on the demerger to bring about a settlement between the Ambani brothers.
— PTI
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Bharti Telesoft offloads 10 pc stake
New Delhi, December 5 Westbridge Capital has invested $8 million, followed by Sequoia Capital $3 million and Cisco $2.5 million, Bharti Enterprises Vice-Chairman Rakesh Mittal said while addressing a press conference here today. While the Goldman Sachs-backed WestBridge has previously invested in Indian companies, it was the first time for the Silicon Valley-based venture fund Sequoia Capital. Bharti Telesoft, a 100 per cent subsidiary of Bharti Enterprises, provides value added solutions to wireless and wireline companies. The funds will be utilised to explore acquisition of companies in expanding markets like China, Russia and Western Europe, besides strengthening R&D and marketing network. Mr Mittal said: “This partnership will enable Bharti Telesoft, which is a leader in offering value added services (VAS) like messaging, ringtones, roaming, customer care and content, to reach new markets and strengthen its three R& D centres in Delhi, Bangalore and Mumbai.” With an annual turnover of over Rs 100 crore last year, he said the company’s services had spanned over 25 countries, 100 networks and 100 million global subscribers. Presently, Bharti Enterprises has 75 per cent stake in the company and 25 per cent is being held by the management team. With the investment, the stakes of the parent company and management would be proportionately diluted. Elaborating the investment, Mr Mittal said about $8 million would be invested by the WestBridge, $2.5 million by Cisco and the balance by the Sequoia venture capital. “The investment will provide an added impetus to achieve our aim of being the leading global provider of innovative products, solutions and services to the telecom sector,” said Mr Sanjiv Mittal, CEO of the company. Regarding the new range of products, the Bharti Telesoft is looking for new fields where service providers would find ways to offer services through internet protocol (IP) networks.
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Mallya to outbid others to buy Air Sahara
Kuala Lumpur, December 5 Speaking on the sidelines of the ongoing 2nd Annual Asia Pacific Aviation Outlook summit organised by the Centre for Asia Pacific Aviation (CAPA) here, Dr Mallya said he would outbid others in the race for buying out Air Sahara. Dr Mallya’s remarks were aimed at Jet Airways, which is also said to be in the race for buying a stake in Air Sahara. Kingfisher Airlines, which is part of the UB Group headed by Dr Mallya and has gone in for a mega expansion by placing orders for 30 state-of-the-art A 319-131 jets from Airbus Industries, has bid for 100 per cent stake in Air Sahara. Kingfisher Airlines bid is learnt to be about $ 510 million, which includes a debt content of around $ 330 million. Dr Mallya said he had bid less than $ 750 million for the Lucknow-based
carrier. — UNI
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LG to make CDMA cellphones in India
New Delhi, December 5 “ LG has plans to manufacture CDMA mobile handsets at Ranjangaon, Pune plant, where the company is presently manufacturing GSM handsets,” said Mr K.R. Kim, President, South West Asia, LG Electronics India (Pvt) Ltd here today, while launching the first service mall of the company. He said the company was already manufacturing 20,000 GSM handsets per month at this plant and expected to produce 20 million mobile handset unions by 2010. The company will also launch DVD writers said, said Mr Kim adding that to strengthen its customer care services, the LG would set up service malls in all the metros, and later in ‘A’ category cities. The service malls, he said, would be equipped with technical and infrastructural support for guaranteed quality service and to ensure short delivery of services.
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Ansals plan three malls in Punjab
Ludhiana, December 5 Mr Mangal said Punjab would soon have Ansal Plaza malls in Jalandhar, Mohali and another mall in Ludhiana. “In Ludhiana the response we got was more than expected which is why we have decided to set up another mall here. Land has already been purchased at several places.” The mall in Ludhiana would be spread over an area of 3 lakh square feet, more than double the existing mall and would have cineplexes as well. Upbeat on Punjab’s economy, he said the people in this state not only had high-income levels but also spent more in comparison to other states. Quoting a survey on malls, he said: “ Of the 50 million square feet of malls that are expected to come up in the next few years, 41 million square feet would be in top seven cities, including Ludhiana.” He said Ansals was laying special emphasis on location and also on the ‘right tenant mix’, besides other factors like good infrastructure and management. On the common perception of high prices of products offered in malls, Mr Mangal said it was not true “It is mostly branded products that are available in malls. Since these are sold on MRPs only, there is no chance of price variations.” The company would shortly come up with malls in Greater Noida, Jaipur, Jodhpur and Panipat.
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SC admits sebi appeal on UBS
New Delhi, December 5 A Bench did not stay the order of SAT absolving the Swiss-based FII for the market crash of May 17, 2004, when Sensex had fallen by 567.74 points and NIFTY had nosedived by 196.90 points, prompting BSE and NSE to temporarily suspend trading twice in a day. However, it stayed the findings of the tribunal regarding the manner in which SEBI had exercised its powers to probe last year’s Sensex crash. Maintaining that SEBI’s preliminary investigation showed that UBS was a major seller in the cash market segment offloading shares worth Rs 188 crore in a single day, the market regulator submitted that the present case involves interpretation, application, enforcement, scope, amplitude and extent of provisions of the SEBI Act as well as FII regulations. — PTI
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Silver, gold at new high
Mumbai, December 5 Silver opened high at Rs 12,725 per kg to close at the same level with a gain of Rs 80 from its Saturday’s close. Pure gold (99.9 purity) also opened upward at Rs 7,680 per 10 gm and closed at the same level with a gain of Rs 70 from its previous close.
— UNI
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China signs
$9.7 b deal with Airbus Re plunges Nobex files for bankruptcy Suzlon contracts Firms purchased Merger United Phos IndianOil pact Portal launched Sportking to enhance capacity Sunstar to invest Rs 60 crore |
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