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Home Loans
Rupee stronger by 41 paise
Infosys bags mega deal from AstraZeneca
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Corus denies merger with Tata Steel
Toyota cuts India output by 30 per cent
ATF cheaper by 11%
HCL completes Axon buyout
Oil above $47 in Asia
Govt needs to spend more to accelerate growth: Study
DLF to invest Rs 15,000 cr on affordable housing
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Rate cuts inadequate, says India Inc
Bhagyashree Pande Tribune News Service
New Delhi, December 15 However, the package should have been extended to existing borrowers as well and some interest concession should have been given to loans above Rs 20 lakh to give an impetus to housing projects in tier-1 cities,” said Krishan Kalra, secretary-general, PHDCCI. “The government also needs to look into high cost and availability of land and environmental clearances required, which have become a major bottleneck in all construction projects. There is also a need for reducing the transaction costs and heavy burden of taxes, which have a cascading affect,” the chamber added. However, industry body Assocham has found the home loan package of the public sector banks highly inadequate, as real estate properties are hardly available at this cost, not even in tier-II and tier-III cities. Assocham president Sajjan Jindal demanded that the government should make available housing loans up to Rs 30 lakh at 6 per cent and above this amount, ideal interest rates would be 8.5 per cent. Welcoming the announcement by the banks to support the medium and small and medium enterprises (MSME) and the housing sector, the CII director-general, Chandrajit Banerjee, said “this comes at the right time and will provide the much-needed support to the two sectors”. The MSME sector has been one of the worst hit as a result of the credit crisis and this would help ease the cost of credit burden on these companies. Dr Amit Mitra, secretary-general, Ficci, said there was a need to give a massive push to affordable housing in the country, and for achieving this, “we need to see much deeper interest rate cuts than what was announced by the PSBs today”. “The cut in the interest rates would propel demand for affordable housing and make developers focus on this segment. The cumulative impact of this would be huge and would be felt throughout the economy,” he said.
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Mumbai, December 15 With the local demand for the US currency waning after the dollar's weakness against a basket of major currencies, the domestic unit even breached the 48-level during intra-day. Marketmen said the greenback lost its rivals primarily because of anticipation of rate cuts by the Federal Reserve tomorrow. In fairly active trade at the Interbank Foreign Exchange (Forex) bank, the domestic unit opened strong at 48.20/21. It improved further to breach 48-level to a high of 47.93 per dollar before closing at 48.04/05, higher by 41 paise from its last close. Forex dealers said positive trend in equity markets also weighed in favour of the rupee. Revival of buying interest by Foreign Institutional Investors (FIIs) in equities also boosted the rupee sentiment. The rupee finally ended at 48.04/05 a dollar, the level not seen since November 10, 2008.— PTI
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Infosys bags mega deal from AstraZeneca
Bangalore, December 15 Under the agreement, Infosys will deliver end-to-end application maintenance services to AstraZeneca’s global operations in areas such as manufacturing, supply chain, finance, human resources and other corporate functions. The deal is a part of AstraZeneca’s “transformation initiative” to accelerate innovation and bring products to market faster. "We chose Infosys as a strategic partner for its understanding of the rapidly shifting dynamics in the pharmaceutical industry," Richard Williams, Global CIO of AstraZeneca was quoted to have said. "The Infosys’s expertise in the field of outsourcing and its track record in rationalising and standardising business process were all contributing factors to our decision to give the contract to Infosys”, Williams said. Infosys is delivering the services through a global shared-services model that offers fixed price for outcome-based deliverables and flexible unit pricing. The model, according to an Infosys spokesperson, will allow AstraZeneca greater operational flexibility, lower risk and better expenditure control. The spokesperson said AstraZeneca would benefit from improved asset utilisation, standardised business processes, globally consistent service quality and a predicable cost structure. The pharmaceutical company is transforming its operations through multiple phases, with the first phase covering the United Kingdom and the Nordics, and the subsequent phases focusing on the United States, Europe, Latin America and Asia. In addition, as part of the transition, AstraZeneca employees in Sweden and the UK will be rebadged to Infosys, thereby strengthening its global delivery network. Commenting on the deal, Infosys CEO Kris Gopalakrishnan said, “Pharmaceutical companies are launching transformation initiatives to improve R&D productivity, focusing on their core competencies. AstraZeneca is leading this trend, and this programme will help us support its business growth and operational excellence goals. This is another significant step in our long-standing partnership with AstraZeneca.”
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Corus denies merger with Tata Steel
London, December 15 "Both stories are completely untrue. We are talking to (the) newspapers to get corrections. I repeat, both stories are completely untrue," Corus spokesperson Bob Jones told PTI, denying reports that emanated in the online editions of two leading dailies in the UK. The Tata Group had acquired the Anglo-Dutch giant Corus Group Plc for $12 billion last year, after which Corus became a subsidiary of the Indian steel giant. However, even after amalgamation, both units operated independently. The media reports on a possible merger between Corus and its parent subsidiary Tata Steel come when the European Steel maker has resorted to cost-cutting, including layoff schemes and production reduction, because steel demand as well as prices have plunged due to the global economic downturn. British newspapers The Mail and The Daily Mail in their online editions had said that Corus is set to be merged with Tata Steel by next year to save up to £350 million, and added that such a move is likely to put thousands of jobs at risk. "Corus, formerly British Steel, is to be merged with its parent company Tata Steel, in a move that puts thousands more UK jobs at risk," the Mail said in its online edition. Tata Steel through this merger aims to create a group that could become the second-biggest steel maker in the world after Luxembourg-based ArcelorMittal, the report further said. "News of the plan could undermine delicate negotiations in which unions are discussing accepting pay cuts of up to 10 per cent for the workforce of 25,000, including the 1,000 workers at the threatened Llanwern steel works in South Wales," The Mail added. Quoting Alan Todd, construction and development general manager at Corus, the report said : "Tata Steel's construction-related assets would benefit from Corus in the UK and the Continent and there would also be huge cost benefits from the Tatas' supply of raw materials." Earlier, on December 11, unions offered to accept a 10 per cent cut in pay for six months in a last-ditch to save the factory in Wales from closure. Globally, steel prices have almost halved to $600 a tonne from the peak of $1,250 per tonne earlier this year. — PTI
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Toyota cuts India output by 30 per cent
New Delhi, December 15 After some of the others major car manufacturers in the country, including Honda-Siel, took the decision earlier this year to revise targets, now world's largest carmaker has decided to cut production in India by 30 per cent this month. The company, which has a joint venture with Kirloskar Group in India -Toyota Kirloskar Motor (TKM), said the slowdown in the auto market has forced it to revise its sales target in India for this year. It is, however, not holding back its other plans for investments in the country and would be going ahead with its earlier plans of investing Rs 3,200 crore in expanding its production capabilities. The decision to revise its sales target for the year in India follows its similar decisions around the world. "Everywhere else in the world, Toyota has put on hold all investments for expansions, except India," TKM managing director Hiroshi Nakagawa has said. He added that the company would be producing 30 per cent less in December due to falling sales. However, the company would decide on the future productions for January and February depending on the market condition. TKM had announced a sales target of 60,000 units for 2008. It had sold 54,181 cars in 2007 in the Indian market. The company posted a fall of 48.55 per cent in sales in November this year at 2,087 units compared with 4,056 units in the same month last year. Incidentally, the company is planning to launch the CNG version of its utility vehicle 'Innova', which could happen by the end of January.
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New Delhi, December 15 ATF in Delhi has been cut by Rs 4,208.37 to Rs 32,691.28 per kilolitre effective midnight tonight, said an official of Indian Oil Corporation, the nation's largest fuel retailer. This is the seventh straight cut in jet fuel prices since price soared to an all time high of Rs 71,028.26 per kl (in Delhi) in August. With international oil prices cooling since, the fuel prices have been slashed in subsequent months. In Mumbai, the home to nation's busiest airport, ATF will cost Rs 33,719.46 per kl from tomorrow against Rs 38,103.19 per kl at present. Since last month, Indian Oil, Bharat Petroleum and Hindustan Petroleum revised jet fuel prices twice a month — on the first and 16th — based on the average imported price in the preceding fortnight. The three firms had earlier this month cut jet fuel prices on an average by Rs 2,480 per kl. — PTI
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HCL completes Axon buyout
New Delhi/London, December 15 The merger of Axon and HCL SAP practice present a greater opportunity to bring new capabilities to the market with a global delivery model providing full life cycle suite of services fitting into HCL's Blue Ocean strategy, HCL Tech CEO Vineet Nayar said in a statement today. Last week, a London court had given the go-ahead to Axon to be acquired by HCL Technologies. India's second largest IT company Infosys was also in the lead to acquire Axon and had made a cash offer of £407.1 million for the same. But Infosys was subsequently outbid by HCL Technologies.
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Oil above $47 in Asia
Singapore, December 15 Light, sweet crude for January delivery was up 92 cents to $47.20 a barrel in electronic trading on the New York Mercantile Exchange by midday in Singapore. The contract Friday fell $1.70 to settle at $46.28. The Organization of Petroleum Exporting Countries (OPEC), which accounts for 40 per cent of global supply, has signalled it plans to announce a substantial reduction of output quotas at its meeting Wednesday in Algeria. Iranian oil minister Gholam Hossein Nozari was quoted yesterday on his ministry's website saying that Iran would push for a production cut of 1.5 to 2 million barrels per day. Analysts have questioned whether OPEC members will follow through with any announced cut.— AP |
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Govt needs to spend more to accelerate growth: Study
New Delhi, December 15 The economists reason that the packages are increasing government’s expenses, but the incomes are dropping, leading to widening of fiscal deficit. The intent behind stimulus package is to stimulate growth through consumption leading to fiscal improvement, but increasing fiscal deficits are usually inflationary, say economists. A government calculation shows that the total fiscal deficit to the GDP by the end of the year will come to 6.6 per cent as against 2.5 per cent as estimated. According to sources in government, the fiscal deficit could increase if the stimulus packages are added eventually. As per the budget estimates for 2008-09, the fiscal deficit was expected to be 2.5 per cent of the GDP. However, the situation has changed dramatically from April 2008, when the budget was made, and today, when the economy is under severe strain, reasons the economist. The government’s stimulus package of Rs 200 billion is 0.6 per cent of the GDP, which as per budget estimates is Rs 53,225 billion. Bloating this expenditure further, the government, in October, had already sought a borrowing of Rs 1,056 billion, which was 2 per cent of the GDP. Adding to this is the oil bonds and fertliser bonds that have been issued by the government. Though these are off-budget items, they amount to Rs 799 billion and are 1.5 per cent of the GDP. Though economists say that saving the economy, jobs and industrial production are more important than managing fiscal deficits, yet these spendings will certainly haunt on a later day in the form of inflationary pressure. The economists point out that revenue falls will continue to remain an area of concern. Earlier, the revenues were buoyant — income tax, service tax, excise duties, customs duties were showing healthy growth, but now industrial production is dipping, jobs are being cut and exports are falling, thus putting a strain on revenues of the government. According to estimates of the commerce ministry, exports dipped by over 10 per cent in November as compared to growth of over 30 per cent in the same month last year. Revenues from direct tax is estimated to be Rs 3,650 billion for 2008-09, but the net collection till November 2008 was Rs 1,772 billion.
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DLF to invest Rs 15,000 cr on affordable housing
New Delhi, December 15 DLF, the country's biggest real estate developer, had last year announced its plan to enter into mid-income housing segment, realising the huge untapped demand in this category. "We will be investing Rs 5,000 crore a year over the next three years on mid-income housing projects," DLF Home Developers vice- president A Harikesh told PTI. "Mid-income homes will be our focus area and will witness significant growth in the coming quarters," he added. DLF's investment plans for affordable housing coincides with announcement by public sector banks to boost the segment by cutting home-loan interest rates, putting caps of 9.25 per cent for Rs 5-20 lakh and 8.5 per cent for loans of up to Rs five lakh. Harikesh said internal accruals, advances against sales and capital raised through private equity would take care of the planned investment. DLF had raised Rs 1,675 crore as private equity in eight projects in November 2007. DLF Home Developers, the wholly owned subsidiary of DLF, would construct about 40,000 housing units in the mid-income category, sizes of which would vary between 1,000 sq ft and 1,800 sq ft, he added. The company has witnessed tremendous response for its mid-income housing projects and sold over 7,000 flats so far this year, despite slowdown in the housing demand for the past six months on account of high interest rate and capital value. DLF has launched mid-income housing projects in Bangalore, Gurgaon, Hyderabad, Indore, Kochi, Kolkata and Pune. — PTI
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