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FDI in insurance sector hiked to
Nod to new air services pact between India, Iran
Rupee at 49.46
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Sensex soars 744 points
Capital restructuring of UCO Bank approved
Cement trade from Pak comes to halt
Barclays to raise £7.3 billion
S&P reaffirms stable outlook rating on India
Accord with EU
Gail, IOC ink pact for petrochemical plant
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FDI in insurance sector hiked to 49 per cent
New Delhi, October 31 “The Cabinet gave its approval for introduction of the Insurance (Amendment) Bill, 2008, for amendment to Insurance Act, 1938, General Insurance Business Act, 1972, and Insurance Regulatory and Development Act, 1999, in the Rajya Sabha on the basis of the recommendations made by the GoM,” finance minister P.Chidambaram told reporters here today while briefing on the Cabinet meeting yesterday. The Bill would be tabled in Parliament in December. However, it is unlikely to be passed in this Parliament mainly due to lack of time, Chidambaram said. Through another Bill, the equity of the state-owned Life Insurance Corporation will be raised from Rs 50 million to Rs 1 billion. Criticising the government’s decision, a statement from CPI-M politburo said the move would be counter-productive and vastly enlarge India’s vulnerability to international speculators. CPI national secretary D.Raja said: “The Prime Minister and the finance minister have been saying India has not been impacted by global financial crisis due to its strong fundamentals, created by PSU banks and insurance firms, which the government is now demolishing by opening them up for FDI.” The decision was, however, welcomed by private insurers. Aviva India MD and CEO designate T.R Ramachandran said: “Increasing FDI would also help the insurance sector to further expand, launch innovative distribution channels, upgrade technology, enhance the current product portfolio and bring in global best practices.” “The insurance sector being a capital intensive sector requires huge investments over a prolonged period of time, and, therefore, there is constant need for capital infusion. A hike in the sectoral FDI cap to 49 per cent would further grow the insurance sector and bring in much needed FDI to the country,” MetLife India Insurance’s managing director Rajesh Relan said. Confederation of Indian Industries termed the Bill as a much-awaited one and said the Bill “would further help in development of the insurance sector”. Ficci said: “We now hope that the Bill would be cleared in Parliament and thereby provide an impetus for further growth of the insurance sector in the country.” Chidambaram today said the clause to raise the FDI cap applied only to private insurers and not public sector insurance companies. |
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Nod to new air services pact between India, Iran
New Delhi, October 31 An MoU was also signed during these consultations. As per the MoU, capacity entitlements for designated airlines of each side were enhanced from the existing 14 services per week to 23 services per week. However, the Iranian designated carriers can operate to/from agreed points of call in India with two services per week from Mumbai and seven services per week each from Delhi, Cochin and Amritsar. The two delegations finalised and initialled the text of a revised air services agreement. The main features of the new agreement are that both countries would be entitled to designate any number of airlines, which would be free to decide tariffs on reasonable levels. An open sky for all-cargo services has been agreed. The designated airlines of Iran may exercise intermediate fifth freedom traffic rights via any two points of their choice (except points in the Persian Gulf). Co-operative marketing arrangements have also been agreed between the two sides. |
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Rupee at 49.46
Mumbai, October 31 However, the RBI today fixed the reference rate for US dollar at Rs 49.25 per unit, down by 52 paise, against yesterday’s rate of Rs 49.77 per dollar. Similarly, the reference rate for Euro also declined by Rs 52 paise to Rs 62.84 per unit from its last close of Rs 63.36 per unit, a RBI release said. — UNI |
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Sensex soars 744 points
Mumbai, October 31 The 30-share bellwether index on the Bombay Stock Exchange concluded the day at 9,788.06, a sharp rise of 743.55 points, or 8.22 per cent. After opening on a strong note, the key index surged by 825 points during intra-day but pares some of its gains to end the day lower than the high seen during the day. Broad-based Nifty on the National Stock Exchange also shot up by 188.55 points or 6.99 per cent to 2,885.60. Analysts said today’s impressive rally can be construed as recovery after relentless selling for about a month in tune with weak trends in bourses across the world. Markets had fallen by a massive 23 per cent this month. Brokers said besides a fall in inflation to below 11 per cent, anticipation of rate cut by the central bank revived investors interest in buying as they feel that both lower lending and inflation rates bode well economic growth. Meanwhile, finance minister P.Chidambaram today said the economy is poised for the other way, taking strong exception to industry chamber Assocham’s forecast that a quarter of people in certain sectors will lose jobs in the next 10 days. Among index-based shares, M&M was by far the top gainer at 23.09 per cent. HDFC was the next best at 17.48 per cent. Jaipra Asso rose by 16.55 per cent, ICICI Bank by 15.50 per cent and Sterlite Ind 14.48 per cent. Heaviest of them all, RIL was up 13.81 per cent. RIL continued to be the top traded share with the highest turnover of Rs 435.83 crore followed by Reliance Capital (Rs 186.93 crore), ICICI Bank (Rs 170.58 crore), SBI (Rs 148.39 crore) and Reliance Com (Rs 135.61 crore). — PTI |
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Capital restructuring of UCO Bank approved
New Delhi, October 31 “The reduction in the pure equity capital will improve the Earning Per Share (EPS) and other financial so that the bank will have more attractive capital structure,” finance minister P Chidambaram told reporters while briefing on Cabinet decisions taken last night. If and when it approaches capital market it would have attractive capital structure and it can raise tier-I capital, he said. This conversion of equity into perpetual non-cumulative preference shares is in accordance with RBI circular of October 29, 2007, he said. UCO Bank has equity capital of Rs 799.36 crore, the highest among all the listed public sector banks. Chidambaram said: “This high equity base suppresses EPS. Besides, it is difficult to service high portion of equity.” — PTI |
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Cement trade from Pak comes to halt
Amritsar, October 31 The Rs 225-crore cement import from Pakistan during the last 4-5 months have virtually come to a grinding halt. A leading importer of Pakistani cement Anudeep Singh Madaan said the price offered by Pakistan was $67 per ton which was not acceptable to India and have suggested bringing down the price to $57 per ton as it would be helpful to restart the cement trade. |
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Barclays to raise £7.3 billion
London, October 31 “The capital would be raised through an issue of £3 billion pounds of reserve capital instruments, with an associated issue of warrants, and an issue of up to £4.3 billion of mandatorily convertible notes,” the bank said in a statement. Assuming the amount of £7.3 billion is raised, the tier-I capital ratio of the bank would be raised to 11.3 per cent whereas on a pro forma basis, it stood at 9.1 per cent as on June 30. The bank would be raising the additional capital from Qatar Holding and Abu Dhabi’s H.H Sheikh Mansour Bin Zayed Al Nahyan, among others. Group chief executive John Varley said: “The financial market environment has continued to be as challenging as any that we have experienced. The strength of our profit performance reflects the conservative stance of our major UK asset portfolios and continued distribution-led growth in retail and commercial banking outside the UK; and in Barclays Capital strong flows of client business and good progress on the integration of the acquired Lehman Brothers businesses.” Meanwhile, Barclays said results for the third quarter included a preliminary estimate of the net benefits arising on the acquisition of Lehman Brothers North American investment banking and capital markets businesses; “and net losses from credit market writedowns of £129 million, comprising writedowns of £1.2 billion offset by £1.1 billion gains on the fair valuation of issued notes”. — PTI |
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S&P reaffirms stable outlook rating on India
New Delhi, October 31 The outlook on the long-term rating remains stable, the rating agency said. The ‘BBB’ rating category means an entity has adequate capacity to meet its financial commitments in the long-term. However, negative means that a rating may be lowered, while A-3 rating means the entity has adequate capacity to meet financial obligations in the short-term. The ratings on India reflect the country’s strong economic growth prospects and its deep government debt market that helps accommodate its weak fiscal position, S&P said in a statement today. “Given the buoyant private and public investments with some progress in economic reforms, India’s business environment is likely to improve in the years ahead, notwithstanding the current dislocations in global credit markets,” said S&P’s credit analyst Takahira Ogawa. Monetary and fiscal reforms, coupled with strict fiscal financing regulations, have led to more robust financial and government securities markets, reinforcing fiscal discipline. “The ratings on India remain constrained by a weak fiscal profile, mainly the high government debt burden and deficit, which are still among the largest for rated sovereigns.” Commitment to fiscal consolidation across all levels of the government has been one of the supporting factors for the sovereign credit rating in the past several years. “However, higher oil prices and populist measures for the coming general election have weakened the government’s efforts in fiscal consolidation,” he said. — PTI |
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Accord with EU
New Delhi, October 31 The pact will work like an “open skies” agreement by encouraging more airlines to offer services between continents, experts say, adding that bilateral agreements will remove nationality issues between India and the EU member countries. The new arrangement will bring all existing bilateral air services agreements between EU member states and India in line with the European Commission Law at one go, thereby obviating any threat of legal challenge. The Cabinet had yesterday given ex-post facto approval to the horizontal aviation agreement. The agreement was signed in Marseilles on September 28 during Prime Minister Manmohan Singh visit to France at the India-EU summit. Experts say Indian operators like Air India, Jet Airways and Kingfisher Airlines can hope to get more access to European destinations. Similarly EU carriers will also have better access to India. Aviation expert Kapil Kaul says in a way the pact will work like an open skies agreement between India and the EU. Officials say though the agreement does not in itself change the number or frequency of flights between the EU and India, it will encourage more airlines to offer services between continents. |
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Gail, IOC ink pact for petrochemical plant
New Delhi, October 31 The proposed chemical plant will use 2,50,000 tons of naphtha produced by IOC’s Barauni refinery and the natural gas that GAIL plans to bring from eastern offshore and imported LNG through the planned Jagdishpur-Haldia pipeline. “We (GAIL and IOC) have today signed a memorandum of understanding (MoU) for exploring the possibility of setting up of cracker complex, including downstream derivatives at Barauni,” GAIL chairman and managing director U.D Choubey said. The two firms by the fiscal year would prepare a techno-economic feasibility study for the unit that would take up to five years for construction. Project structure and equity participation has not yet been decided. ‘It could be a 50:50 joint venture between GAIL and IOC... it may also be a public-private partnership,” Choubey said indicating that the alliance had room to induct a strategic partner. A 130-km spur line from Gaya to Barauni would be laid to transport gas to Barauni fertiliser plant, IOC’s refinery and the proposed petrochemical unit. GAIL’s Jagdishpur-Haldia pipeline would transport gas found in eastern offshore. The MoU with IOC is part of GAIL’s vision to make petrochemical its second largest revenue earner after natural gas transmission and marketing. The company had recently signed an agreement with Reliance Industries to explore possibility of setting up a mega petrochemical plant in North Asia and Central Asia. GAIL has already announced plans to double its Pata petrochemical plants capacity to 8,00,000 tons in 3-4 years. Behuria said the investment in Barauni chemical plant had no co-relation with the decision to defer investments in the petrochemical complex that was to come up alongside Paradip refinery in Orissa. “The Paradip refinery is being done on IOC balance sheet and considering fund crunch we face because of losses on fuel sales, we had decided to defer investment in the petrochemical plant at Paradip,” he said. — PTI |
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Corporate Results
New Delhi, October 31 Ranbaxy Laboratories
Ranbaxy Laboratories has reported an operating loss of Rs 4.9 crore for the third quarter ended September 30. The operating profit after tax in the corresponding quarter of last financial year was Rs 161.9 crore. Total sales stood at Rs 1,888.40 crore for the third quarter, up 14.3 per cent from the corresponding quarter of the previous fiscal. Punjab National Bank
Punjab National Bank has said its net profit grew 31 per cent to Rs 707 crore for the second quarter ended September 30. The PSU lender had a net profit of Rs 538.48 crore in the September quarter last fiscal, PNB said. The total income rose to Rs 5,313.18 crore for the quarter under review, from Rs 3,930.89 crore in the same period of the previous fiscal. Suzlon Energy
Suzlon Energy has said its net profit declined by 95.22 per cent to Rs 16.98 crore for the second quarter ended September 30, over the corresponding period a year ago. The company had a net profit of Rs 355.56 crore in the second quarter last fiscal, Suzlon Energy said. Total income rose to Rs 2,234.47 crore for the quarter under review, from Rs 1,594.57 crore for the same quarter last year. RCom net up
Reliance Communications has posted a 17.31 per cent increase in net profit to Rs 1,530.78 crore for the second quarter ended on September. The consolidated revenue was up by 23.30 per cent at Rs 5,645 crore in the July-September quarter, the company said. MMTC profit up
MMTC has said its net profit grew by 30.32 per cent at Rs 48.78 crore for the second quarter ended September 30, over the corresponding period a year ago. The company had a net profit of Rs 37.43 crore in the second quarter last fiscal, MMTC said. Nestle India
Nestle India has said its net profit for the third quarter ended September 30 grew 13.52 per cent at Rs 131.76 crore over the corresponding period a year ago. The company also announced second interim dividend at Rs 14.80 per equity share. It has also approved the distribution of special dividend of Rs 7.50 per equity shares under the scheme of arrangement between the company and the shareholders and creditors. Tata Motors
Tata Motors has reported a 34.14 per cent decline in its profit after tax for the quarter ended September 30 at Rs 346.99 crore. The company had a PAT of Rs 526.84 crore during the same quarter last year, Tata Motors said. The total revenue in the second quarter, however, increased by 6.09 per cent to Rs 7,078.85 crore from Rs 6,672.65 crore in the year-ago period, it added. Kotak Mahindra
Kotak Mahindra Bank has said its consolidated profit after tax declined by 33.33 per cent at Rs 160.97 crore for the second quarter ended September 30 over the corresponding period a year ago. The bank had a PAT of Rs 241.45 crore in the second quarter of FY’08, the bank said. IndianOil Corp
IndianOil has reported a net loss of Rs 7,047.13 crore for the second quarter ended September 30. It posted a net loss of Rs 7,047.13 crore in July-September quarter as against a net profit of Rs 3,817.75 crore in the same period previous year, the company said. Reliance Capital
Reliance Capital has said its net profit grew by 15 per cent to Rs 229.4 crore and total operating income rose by 38 per cent to Rs 1,313 crore for the second quarter ended September 30, compared with the year-ago period. The company had a net profit of Rs 200.10 crore in the September quarter last fiscal, Reliance Capital said. — Agencies |
CPI-IW up by one point PNB slashes PLR by 50 bps SpiceJet services
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