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Flextronics sells 85 per cent stake
Spice Nepal partners want Modi to pay $62,000
Momentum of economy may continue,
China wants India to open up retail sector
MNCs seek exclusion of ONGC,
RIL from NELP-VI
Kyrgyz delegation in Haryana
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AP allots land to MS, Honeywell
3i Infotech buys Datacons
Biotech to get same edge as IT: PC
Yakult plans unit near Sonepat
Corporate Results HDFC Bank Nestle India CMC in black Guj Ambuja payout UTI Bank 
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Flextronics sells 85 per cent stake for $900 million
New Delhi, April 17 Flextronics, while retaining 15 per cent stake in the new entity that is yet to be named, will receive over $600 million in cash and would hold a $250 million face value note to be paid over eight years, Flextronics Software Systems (FSS) CEO Ash Bhardwaj told reporters here today. The company expects $175 million gain on the sale transaction after tax, he said. FSS along with global software development company Frog Design will continue to focus on communication network and product development services around the globe. Flextronics, with 15 per cent stake, will operate as an independent software development and solutions company, he said. When asked if the company plans to sell its 15 per cent stake to KKR, Mr Bhardwaj said: “We plan to keep that share with us for a long time.” On the advantage the company would have by selling the stake to a private equity firm, he said KKR, which has offices in New York, Menlo Park, California, London, Paris, Hong Kong and Tokyo, has strong relations with players in leading industries and the new entity would benefit from its relationships. “With KKR, we are be better positioned to further develop our services and products offering, and expand our customer relationships,” he said. The transaction, expected to close in the summer, is subject to regulatory approvals and other customary closing conditions, FSS President and Managing Director Arun Kumar said. “The company with over 6,100 employees in India will provide end-to-end services to the communications industry,” he said. About 85 per cent of the company’s processing centres are in India. Kohlberg Kravis Roberts, in a statement, said the company’s existing management team would continue the lead the software business.
— PTI
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Spice Nepal partners want Modi to pay $62,000
Kathmandu, April 17 Spice Nepal, a joint venture between Spice Cell, investment company from Kazakhstan, Visor, and Nepali investors, had become the first private company in the kingdom to start cellular phone services last year. The venture was dogged by controversy from its very inception when the original Nepali partners, the Khetan Group, pulled out and Visor and other Nepali investors moved in. While Visor holds 75 per cent of the shares and Spice Cell just 5, the remaining are owned by the Raj Group, headed by Raj Bahadur Singh, the king’s son-in-law, and other Nepalis, mostly non-residents. The new partners moved in when Nepal was passing through unprecedented turmoil, with the king engineering a coup during which all telecom links were snapped. The new partners in Spice Nepal have upped their equity since then and have been asking the Modi Group to pay the additional amount. It comes to about Nepali Rs.4.5 million ($62,000) for 50,000 shares. However, despite two notices to the Modi Group last year, the Indian company, currently going through a difficult phase, has not responded. On Monday, Spice Nepal served a public notice to the Indian partner, giving them 30 days to pay up. If it doesn’t respond, current shareholders would have the first right to buy up the shares. Nepal’s telecom sector has become a highly risky proposal for investors since the royal coup. Whenever there is fresh unrest, the royalist government has been shutting down mobile phone services. “We are losing money,” royalist minister Shrish Shumsher Rana, who is also the government spokesperson, admitted this week after the state shut down mobile phones yet again for four days.
— IANS
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Momentum of economy may continue, says RBI
Mumbai, April 17 In its annual macroeconomic and monetary developments document for 2005-06 released today, the central bank said the economy of the country exhibited a strong performance during 2005-06, led by sustained growth in the services sector and the industry. Citing advanced estimates of the Central Statistical Organisation (CSO), the document said the real GDP growth accelerated from 7.5 per cent in 2004-05 to 8.1 per cent in 2005-06. “The services sector, which recorded double-digit growth for the second successive year, continued to be the major driver of economic activity, contributing almost three-fourth of overall GDP growth during 2005-06,” it said. Growth in the services sector accelerated to 9.9 per cent during April-December 2005 from 9.7 per cent during the same period last year. Trade, hotels, transport, communication, finance, insurance, real estate, business services and construction recorded robust growth, it added. “Growth in industry was propelled by the manufacturing sector,” it said, adding the manufacturing sector recorded a growth of 9 per cent in 2005-06 on top of 8.9 per cent rise a year ago. Stating that the central bank had injected liquidity into the system through unwinding of the market stabilisation scheme (MSS) and repo operations under the Liquidity Adjustment Facility (LAF), it said the banking system, as a result, was able to meet the sustained pick-up in credit demand from the commercial sector. “Strong growth in deposits as well as access to non-deposit sources also enabled the banking system to meet the enhanced demand for commercial sector,” the RBI said. — PTI
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China wants India to open up retail sector
Beijing, April 17 “India should take serious consideration on the recognition of the market economy status of China to further the business relationship between the two countries,” Assistant Chairman of the China Council for the Promotion of International Trade
(CCPIT), Mr Wang Jinzhen said. “I can tell you that 95 per cent of the commodities in China are regulated by the market forces without any intervention by the government,” Mr Wang said while addressing a CEO Business Summit, organised jointly by the Ficci and CCPIT here. “Chinese enterprises are responsible for their gains and losses themselves without financial support from the government. Normally, they cannot buy or even export lower than their cost. This is the fact in China right now,” he said. India has not yet granted ‘market economy’ status to China, which became a full-fledged member of the World Trade Organisation (WTO) in 2001, he said, while noting that nearly 50 countries, including members of the Association of Southeast Asian Nations (Asean) have recognised China as a market economy. Countries and regions like the United States, India and the European Union have not yet granted ‘market economy’ status to China. According to statistics from the Chinese Ministry of Commerce, India has initiated over 90 anti-dumping investigations against Chinese products, two on safeguard measures and one investigation on special safeguard measures. The value of the Chinese goods involved in anti-dumping measures from India total $720 million, a senior Chinese Commerce Ministry official said. Mr Wang, also Assistant Chairman of the China Chamber of International Commerce, pointed out that both China and India have to make efforts to bridge the ‘knowledge gap’ that acts as a barrier in stepping up bilateral cooperation between two Asian giants.”We now suffer from knowledge gap,” he said. The official also expressed concern at the delay in granting business licenses to Chinese telecom majors to set up operations in India.
— PTI
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MNCs seek exclusion of ONGC, RIL from NELP-VI
New Delhi, April 17 During the one-on-one meetings at the NELP-VI roadshows in London and Houston, the multinationals said that since the ONGC and Reliance Industries already had too many exploration blocks with them, they must be kept out of the new round, industry sources said. Most global oil giants have stayed away from the previous five auctions due to aggressive bidding by the domestic majors. However, NELP-VI has evoked considerable interest after major gas strikes by Reliance and ONGC-Cairn Energy in the Bay of Bengal and big oil finds by Cairn Energy in Rajasthan. The MNCs said a “holiday” from bidding for fresh exploration blocks would also ensure that the ONGC and RIL concentrate on drilling their current blocks rather than seek time extensions due to paucity of equipment and manpower. The sources said the MNCs felt threatened by the aggressive fiscal terms offered by the ONGC and Reliance and thus the demand for their exclusion. More than Rs 40 crore worth of data has already been sold to companies worldwide. This was far higher than the entire value of the data sold during the earlier round when data worth about Rs 20 crore was sold. Bids for NELP-VI are due on September 15. — PTI
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Kyrgyz delegation in Haryana
Chandigarh, April 17 The delegation will visit IMT, Manesar, call centres and BPOs in Udyog Vihar, Maruti Udyog, Hero Honda company and Orient Craft at Gurgaon on April 18. In the evening, a meeting will be held with the Haryana Governor, Dr A.R. Kidwai and senior officers of the Industries Department and representatives of garments, leather, motor cycle, bicycle and marble industries. The delegation will also visit industrial estates and Food Park at Rai, National Fertilisers Limited and handloom units at Panipat, Liberty Shoes at Karnal, Kurukshetra Panorama and Science Centre at Kurukshetra and manufacturing units of medical instruments at Ambala. The delegation will hold a high-level meeting with the state government on April 21 at Chandigarh.
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Mumbai, April 17 Total income stood at Rs 3,077.1 crore for the fourth quarter ended March 31, 2006, whereas the same was at Rs 2,123.28 crore in the year-ago period, the company said. The Board of Directors have recommended a final dividend of Rs 4.50 per equity share of Re 1 each, subject to shareholders approval. The company has also approved a bonus issue of equity shares in the ratio of one equity share of for every share held by the shareholders, it said. For the year ended March 31 2006, the company’s net profit stood at Rs 2,716.87 crore where as the same was at Rs 1,831.42 crore in 2005-04. Total income was at Rs 11282.81 crore for FY 05-06 where as the same was at Rs 8,122.81 crore FY 04-05. Financial results for the fourth quarter and the financial year are not comparable with the previous years figures as they include figures of amalgamated companies. — PTI
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AP allots land to MS, Honeywell
Hyderabad, April 17 Information and Public Relations Minister Shabbir Ali said that the Cabinet had decided to allot Microsoft Corporation additional land measuring 6.78 acres adjacent to their present lacation near ISB in Manikonda. As part of its expansion plans, Microsoft intends to add another about 1,900 software professionals., Microsoft, which has set up a campus in the city in about 42.25 acres allotted in August, 2003, by the previous government, had invested about Rs 50 crore and provided employment to about 3,600 IT professionals. The government decided to allot the additional land at Rs 29 lakh per acre, he added. The Cabinet also approved the allotment of 10 acres of land to Honeywell to set up its facility at Nanakramguda in the city. Honeywell intends to invest Rs45 crore and provide employment to about 5,500 candidates by 2009. In addition to software development, Honeywell also specialized in aerospace controls, turbo-chargers and automotive products. About Rs 40 lakh per acre would be collected from the company, the minister said.
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3i Infotech buys Datacons
Mumbai: Marking its foray into the mutual fund solutions market, IT solutions provider 3i Infotech Ltd today acquired Bangalore-based Datacons Ltd for nearly Rs 40 crore.
“We were looking to enter the mutual fund solutions industry and had been working on it for a while and this acquisition helps us in our foray into it,” company Chief Financial Officer Amar Chintopanth said. The company would also look at developing the product of Datacon with further investments if required, he added. Mr Chintopanth also said the 250 employees of Datacons would be absorbed into 3i Infotech in a couple of months. When asked as to when the acquisition’s results are likely to reflect on the balance sheet of the company, Mr Chintopanth said the full results would be reflected in the second quarter of the current fiscal.
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Biotech to get same edge as IT: PC
Bangalore, April 17 Mr Chidambaram, who was inaugurating a biologics facility of the Biocon group on the outskirts of the city, said the country had a huge advantage in the sector, including a well-trained talent pool which could lead to tremendous growth. Biocon Chairman Kiran Mazumdar-Shaw said the new facility would add $110 million to the company’s sales by 2010. The growth in profit could come from the company’s plans to sell insulin in the European market. Earlier, Ms Shaw said biological drugs were gaining an increasing market share in the pharmaceutical sector. The new facility would manufacture a broad range of novel and bio-similar therapeutic products for the treatment of cancer, auto-immune and metabolic diseases. She said the building was also designed to cater to contract manufacturing needs of international biopharmaceutical companies.
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Yakult plans unit near Sonepat
New Delhi, April 17 “The new unit will produce the company’s fermented milk drinks and will be set up in an area of 8 acres, at the Food Park in Rai Industrial Estate, developed by Haryana State Industrial Development Corporation (HSIDC),” Yakult Danone MD Kiyoshi Oike
said. The installed capacity of the plant, which will start production in 2007, will be 1 million bottles per day, achieved over four phases. “Rai, Haryana, is an ideal location for this venture as it provides excellent infrastructure facilities, access to the big market of Delhi, and strong support from HSIDC and the state government of Haryana,” Mr Oike said.
— UNI
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Silver crosses Rs 20,000 level
Mumbai, April 17 Ready silver (.999 fineness) started the day on a new high of Rs 20,155, registering a steep rally of Rs 265 from the previous weekend close of Rs 19,890. Standard gold (99.5 purity) and pure gold (99.9 purity) also resumed at new highs of Rs 8,910 and Rs 8,955, respectively.
— PTI
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Gabriel unit
Solan, April 17
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Corporate Results
Bangalore, April 17 The net profit went up by 30 per cent at Rs 581 crore. BEL Chairman Gopala Rao said the net profit of the company had risen by 30 per cent. BEL accounted for supplies worth Rs 3000 crore for defence purposes while its civil segment during the year stood at Rs 500 crore. Mr Rao said the company recorded exports of $13.58 million during the year as against $12.50 million last year. Precision Electro Mechanical subsystems and parts to General Electric Medical Systems and ‘build-to-print’ contract manufacture of satellite radios for the US market formed a major part of the exports. The company hoped to cross an export target of $24 million this year. HDFC Bank
HDFC Bank Ltd has posted an increase of 30 per cent at Rs 263.21 crore in net profit for the fourth quarter ended March 31, 2006, as against Rs 202.37 crore for the same period 2004-05. The bank’s total income also grew by 54.75 per cent at Rs 1682.65 crore for Q4 in 2005-06 as compared to Rs 1087.27 crore in the fourth quarter 2004-05, the bank said. The Board of Directors has recommended a dividend of 55 per cent for the year ended March 31. For the year ended March 31, 2006 the bank’s net profit stood at Rs 870.78 crore as against Rs 665.56 crore for the 2004-05. Nestle India
Nestle India Ltd has declared an interim dividend of Rs 6 per equity share for this year. The Board of Directors has recommended an interim dividend of Rs 6 per equity share, the company said. The interim dividend would be paid to shareholders on and from May 9 this year, together with the final dividend for the year 2005 of Rs 2 per equity shares which was announced earlier. CMC in black
IT solutions provider CMC Ltd has posted a net profit of Rs 8.55 crore for the quarter ended March 31 as compared to a net loss of Rs 16.72 crore for the corresponding quarter previous year. The company’s board has recommended a dividend of 50 per cent on shares of Rs 10 each for the year ended March 31 as against 45 per cent paid for the previous year. For the year ended March 31, the company reported a net profit of Rs 44.11 crore as against Rs 23.05 crore for the corresponding period last fiscal. Guj Ambuja payout
Gujarat Ambuja Cement Ltd has posted an increase of 108 per cent in its net at Rs 298.59 crore for the third quarter ended March 31, 2006, as against Rs 143.11 crore for the same period in 2004-05. The total income for the third quarter increased by 44.75 per cent to Rs 978.13 crore as compared to Rs 675.70 crore in the year-ago period, the cement major said. The company’s Board of Directors has recommended an interim dividend of 50 per cent that is Rs 1 per share. The group has reported a consolidated net profit of Rs 315.70 crore for the quarter ended March 31 2006 where as the same was Rs 155.60 crore in the third quarter of 2004-05. UTI Bank
UTI Bank Ltd has posted an increase of 30 per cent in net profit at Rs 151.73 crore for the quarter ended March 31, 2006, as compared to Rs 116.54 crore for the corresponding period in 2004-05. The bank’s total income grew 46 per cent to Rs 1060.72 crore for the fourth quarter in 2005-06 from Rs 722.42 crore in the year-ago period, the bank said. The Board of Directors has recommended a dividend of 35 per cent ie. Rs 3.50 per equity share subject to the shareholders approval. For the year ended March 31, 2006, the net profit stood at Rs 485.08 crore as compared to Rs 334.58 crore for the same period in 2004-05.
— TNS, Agencies
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Metal prices up Order for Thermax Rs 581-cr contract
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