New Delhi, July 2
The complex and sensitive issue of the Research in Motion-produced BlackBerry services in India finally seems to be getting solved with the government today saying that it was of no threat, and that those looking to start this value-added service needed no permission.

Even though the security agencies have created a major fuss about they not being able to intercept the e-mails and the messages sent by the users of the BlackBerry through the instrument, telecom secretary Siddharth Behura told reporters here that there was no threat from BlackBerry services.

Security agencies have been insisting that the company must place one of its server, through which the information is routed to BlackBerry handsets in India. Security agencies insist on intercepting data sent through the service as they fear it could be used by terrorists.

There have been a number of meetings between the representatives of Research in Motion (RIM) and the Indian authorities over the issue and at one time it was also threatening to turn into a full-fledged diplomatic row.

The statement of the telecom secretary assumes importance as this would signal a relief for RIM and also give assurance to the users of BlackBerry that the services would not be curtailed or stopped.

Asked if the government would give approval to companies that have applied for starting Blackberry services, he said: “There is no permission needed for starting value added services. We have not given permission to anybody, we have not disallowed anybody”.

Mumbai, July 2
The Indian stock markets are surely in the grip of the bears even though no one seems to doubt the strength of the India story.

Today's impressive 700-point rally notwithstanding, analysts are certain that we are in the grip of a bear market with the Sensex range- bound.

Among those predicting a deeper downside include, Laurence Balanco of CLSA, who told television channels that he saw support for Nifty at between 3,600-3,700 points — a further 10 per cent downside from present levels.

There is unanimity among analysts that there would be much pain in the short term for investors. Balanco says the downtrend is likely to continue till early 2009.

Among the factors that could put pressure on stocks could be the high price of crude oil if it moves to the levels of $180 per barrel.

In the local context, a spike in inflation, apart from political uncertainty, could result in the Indian markets being more volatile than bourses in Asia and other emerging markets.

Even the most bullish of analysts admit that the fundamentals of the Indian economy have changed over the short term.

"If you have a 12- month view, the (fundamentals have changed), inflation is up, so is interest rates and there is a threat of political instability, but companies are not made in 12 months. Once we pass through this phase, the India story will get stronger," says Basant Maheshwari, who runs The Equity Desk, a self-help forum for investors pool in ideas and information on various stocks and sectors.

Others feel that the foreign institutional investors (FIIs) may be through with selling. "I think one per cent more pain is left (and it would come from) retail investors and domestic institutional investors," says Bhupendra Kochar, a sub-broker.

Others, like Maheshwari, feel that domestic institutional investors like mutual funds are sitting on piles of cash and could buy at lows. "The DIIs have enough cash and there is no leverage in the retail category. The selling will come from FIIs, if, at all, but, my sense is we are very close to the worst," says Maheshwari.

Value investors, or those who buy shares of well-performing companies that have been excessively beaten down in the market, feel it is time to buy.

"Investors should buy gradually and if the Sensex falls to 12,000, moderately, and aggressively if index falls to 10,000," says Kochar.

Others like Maheshwari feel that the markets are at their low points already though specific sectors could still get hammered.

"Specific sectors will continue to feel heat, primarily amongst them is real estate, which runs the risk of becoming what tech was to the markets in 2000," he states.

With the India story still going strong, analysts are advising patient investors to start picking up shares in the top one or two companies select sectors.

"Sectors like retail, financial services, top-notch infrastructure companies have a long way to go and this is an opportunity that investors should utilise," says Maheshwari.

New Delhi, July 2
Skyrocketing crude oil prices are likely to continue the upward march and could reach $175 a barrel by Diwali unless there is significant decline in demand from growing economies, analysts say.

Crude oil prices have risen by about $40 since March. Currently on New York Mercantile Exchange, oil traded near record high levels around $142.

"Considering the current situation and pace of price rise, crude oil rates may go up to $175 per barrel in the global market. Prices may get fresh triggers, if Israel attacks Iran this year which would affect Mideast supplies," Religare Commodities Head (Commodity Business) Jayant Manglik told reporters.

High volatility spurred by uncertain geo-political tensions, slumping US economy and spiralling demand across the world would continue to support the already high crude oil prices, he said.

"If you look at the technical chart, prices have moved upwardly in the last six months and we expect the bullish trend to continue further in the coming months. Prices may go beyond $175 per barrel and touch $200 per barrel," Mumbai-based Kotak Commodities Services technical analyst Dharmesh Bhatia said. — PTI

Madrid, July 2
Iran, the second largest exporter among oil cartel OPEC, today ruled out increasing the output immediately to cool record high prices but said current rates were not good for both consumers and producers.

"We have some spare capacity in oil production. At the same time we have to say that there is no need for more supplies to the market," Iranian Oil Minister Gholamhossein Nozari told reporters on the sidelines of the 19th World Petroleum Congress here.

Record rates at $142 a barrel have forced countries like India to raise fuel price, which is spurting thier domestic inflation.

India, faced with 13-year high inflation of 11.42 per cent after raising petrol and diesel prices by Rs 5 and Rs 3 a litre last month, has been seeking a hike in output by Organization of Petroleum Exporting Countries (OPEC) to cool the crude prices.

"If there is going to be any need in the market, we surely are going to contribute to that, Nozari said. Iran has a production capacity of 4.35 million barrels per day.

Commenting on the current level of crude prices, he said high prices are "not good for consumers or producers. We as producers want sustainable markets".

Nozari said high oil prices were a result of devaluation of US dollar and if it continues like this, we have no other choice but high prices. — PTI

Mumbai, July 2
High inflation and slowing down of growth have been forecast by an economic think-tank for the remaining part of this fiscal in the face of difficult macro-
economic situations.

However, as the supply-side scenario improves, the inflationary pressures are likely to ease in long term, National Council of Applied Economic Research (NCAER) said in its macrotrack monthly report.

"The inflationary pressure is more intense on primary articles and indicates the potential for easing of the pressure as the supply scenario improves," it said.

In long term, the country's policy makers will have to address the twin concerns of demand pressure and subsequent high rate of inflation, NCAER said.

Reflecting an unprecedentedly high global crude and commodity prices, India's inflation touched a 13-year high of 11.42 per cent for the week ended June 14, drawing instant monetary, fiscal actions from the government.

While the government imposed trade restrictions to tame the inflationary pressures, the central bank announced a series of hikes in its key-rates.

The slowdown in growth on account of the adverse global factors may be offset by the expansionary fiscal policy, the report said, however, added "the latest turbulence in the crude oil market is an important factor that needs to be watched as the year progresses".

A cooling US economy has helped the country sustain the economic growth momentum in the second half of last fiscal, NCAER said.

India's external sector, though relatively small, is gradually expanding in terms of the international financial and trade linkages," it said.

Meanwhile, the net impact of government's Rs 71,000-crore loan waiver scheme and recommendations of the Sixth Pay Commission is likely to stimulate the demand in the months ahead, NCAER said.

"This will also reduce the cost-push effect of rising commodity prices through lower indirect tax rates," it said.

Reserve Bank's monetary policy, which primarily aims to hold off the inflationary pressures, has provided an attractive environment for capital inflows, it said.

RBI deputy governor Rakesh Mohan yesterday said the central bank has stepped up its monetary surveillance given the changed economic conditions both domestically and globally.

However, the apex bank has not seen any "material changes" in the domestic financial conditions after the last week's monetary action, Mohan said. — PTI

New Delhi, July 2
With ATF prices rising between 4.3 per cent and 6.5 per cent, most airlines are once again expected to pass on the burden to passengers to offset increasing fuel cost. Domestic air travel is likely to become more expensive in the coming days.

Spicejet chief financial officer Partha Sarathi Basu said air fares had increased 70-80 per cent for a low-cost carrier (LCC) and passenger load decreased by 5 to 7 per cent in the past one year.

Another option that some Indian carriers are considering is hedging. While aviation companies across the world have indulged in hedging to cushion themselves from rising oil prices, airlines in India have stayed away, largely because of lack of expertise in the area.

Basu said SpiceJet "will also consider hedging at an appropriate time,” when asked how his airlines was planning to cope with the latest hike in ATF.

In 2007, after the government allowed hedging, Air India was the only airline to hedge. In India, lack of internal expertise has made airlines stay away from hedging, says CEO Indian Sub-continent, Centre for Asia Pacific Aviation, Kapil Kaul.

Kaul also adds that hedging at the time when prices were at $142 per barrel is not an easy decision for airlines to take.

“It be would a tough decision for airlines to take a call at this point of time. International airlines understood that oil prices were on an upward swing so they hedged. For the Indian companies, unless the oil is going to go up to $175 per
barrel or beyond, it will not be an easy decision. However, considering that oil
prices are not expected to come down drastically in near future, airlines can indulge in part hedging".

Currently, ATF constitutes 45-50 per cent of the operating cost of most domestic airlines. Domestic airlines last raised fares on June 19 this year.

On this occasion, Schwarzkopf Professionals organised a workshop on the new Spring-Summer collection 'Essential Looks Show' on hair care and hair colour.

The company also plans to introduce phones ranging from the entry-level to mid-range to Internet-based ones.

Chandigarh, July 2
A majority of retail outlets of Hindustan Petroleum Corporation (HPCL) in Punjab and Haryana are facing an acute shortage of fuel for the past 10 days.

The stock-transfer agreement with Indian Oil Corporation (IOC) has reportedly not been honoured by HPCL in other parts of the country (Bihar and Andhra Pradesh), forcing the IOC to restrict fuel supply to HPCL in the region.

Well-placed sources informed TNS that all three oil marketing companies enter into stock-transfer agreements, wherein they transfer stock to the other in one region, and can get the stock back in another region of the country.

“HPCL had been taking stocks from IOC here, but had failed to return the stocks to IOC elsewhere. As a result, IOC restricted the supplies to HPCL at its terminals in Ambala, Jalandhar and Sangrur,” said a top official.

As a result, the retail outlets of HPCL here have been facing an acute shortage. A petrol station owner in Patiala informed TNS that for the past 10 days, he has been getting just 50 per cent of the fuel that is asked for.

“Last week, I had sent an indent for 12 kl of fuel, but I got just six kilolitres. After this, I got a supply only yesterday,” he rued.

He added that though IOC and Bharat Petroleum Corporation (BPCL) were not forcing their dealers to lift premium fuels, HPCL was forcing them to lift and sell premium fuels.

Officials in the HPCL agree that the fuel supplies had been hit for the past couple of days. Amit Mehra, regional manager, HPCL, said they were facing constraints on supply side, but assured that the matter would be sorted out soon.

“We have already received some supplies at our terminals last night, which would ease out the situation,” he added.

Sources informed that last night, IOC released 3,000 kilolitres of fuel to HPCL. However, this would only provide temporary relief to the HPCL outlets, who will still get a restricted supply, till a long-term solution is worked out with IOC.

Mumbai, July 2
Shares of realty major DLF soared over 15 per cent as the company announced it would consider buying back some shares to "protect shareholders' interest".

In a regulatory filing here, the New Delhi-based real estate major said today its board would meet on July 10 to consider and approve buyback of equity shares of the company.

The buyback proposal follows a sharp erosion in the company's market value over the recent past, which saw its share price plunging to below the issue price of Rs 525, at which the company had sold shares to public about a year ago.

At one point of time, the shares were trading at over double the public offer, but it has dropped to less than half of the life-time high of Rs 1,225, scaled on January 15 this year.

However, the stock rebounded sharply today and settled 15.08 per cent higher at Rs 423.95, after hitting an intra-day high of Rs 439.90. However, the scrip had also fallen to its all-time low at Rs 350.30 in the morning trade today. — PTI

BRIEFLY

IFC buys into Modern Dairies
Mumbai: World Bank's private sector financing arm International Finance Corporation (IFC) will be acquiring 46.50 lakh shares of Modern Dairies for Rs 27.90 crore. The dairy firm has entered into a 'Subscription Agreement' and a 'Shareholder Agreement' with IFC in this regard. As per the agreement, IFC would be subscribing up to 46.50 lakh shares at Rs 60 each, the Haryana-based firm said in a filing to the Bombay Stock Exchange. — PTI

Piramal Healthcare buyout
Mumbai: Piramal Healthcare on Wednesday said it has acquired blood plasma products of Germany-based PlasmaSelect AG for an undisclosed amount. The company announced the completion of a definitive agreement with PlasmaSelect to acquire its polygeline-based blood plasma products marketed under the brand name 'Haemaccel' in over 38 countries, Piramal Healthcare said in a filing to the Bombay Stock Exchange. — PTI

SemanticSpace acquisition
Hyderabad: SemanticSpace, a global software solutions company, today said it has acquired Prolifics, a systems integrator specialising in IBM techonologies, for $40 million in all-cash deal. The deal includes an upfront payment of $26 million and the rest in the form of earn-out over two years. — PTI

Glenmark in Poland
Mumbai: Drug maker Glenmark Pharmaceuticals on Wednesday said it has signed agreements with Iceland-based Actavis to acquire seven pharmaceutical brands in Poland for an undisclosed amount. The acquisition would provide Glenmark its first access to the growing pharmaceutical market in Central and East Europe, the company said in a filing to the Bombay Stock Exchange. — PTI

Shri Lakshmi Cotsyn plan
Mumbai: Kanpur-based textile company Shri Lakshmi Cotsyn (SLCL) plans to invest Rs 350 crore to more than double its terry-towel manufacturing capacity and set up a new captive power plant. "Out of Rs 350 crore capital expenditure, Rs 170 crore will be financed through term loans under Textile Upgradation Fund Scheme (TUFS) and the remaining Rs 180 crore will be raised through equity," the company's CMD M.P. Agarwal said. — PTI

Gold may touch 13,500
Mumbai: Gold demand is expected to pick up after August with its price expected to touch the Rs 13,500 per 10 grams mark, a top industry official said here. "Gold prices may range between Rs 12,500 and Rs 13,500 in the near future. Demand, which is flat presently, will pick up once the festival season commences after August," Bombay Bullion Association president Suresh Hundia said today. — PTI