New Delhi, August 31
Steel tycoon Lakshmi N Mittal and Hindustan Petroleum Corp Ltd (HPCL) plan to sell a 10 per cent stake each in the under-construction Bathinda refinery through an initial public offering (IPO) in April next year to raise Rs 1,000-1,500 crore.

"The IPO is being planned closer to mechanical completion of the 9 million tonnes a year refinery in March/April next year," a source in-the-know of the development said.

HPCL-Mittal Energy Limited (HMEL), a joint venture between sHPCL and Mittal Energy Investment Pte Ltd, Singapore, a L N Mittal Group Company, is building the Rs 18,919 crore refinery at Bathinda.

The two hold a 49 per cent stake each in HMEL, while the remaining 2 per cent is with financial institutions.

"The refinery is over 80 per cent complete. It is expected to be mechanically complete by March/April next year.

The two promoters plan to sell 10 per cent stake each in an IPO around that time," the source said. "The money thus raised would be used by HPCL and Mittal to pay some of their debt."

A small section of the cross-country 1,014-km pipeline which will carry imported crude oil from Mundra, in Gujarat, to the refinery, remains to be completed.

The Bathinda refinery is likely to start processing crude oil in April and all its units will be sequentially commissioned by the end of 2011, he said. — PTI

New Delhi, August 31
Rebutting news reports that Japan’s auto giant Honda was set to exit from one of the oldest automobile manufacturing partnership in the country, Hero Honda, management of the Indian group today said there was no such move.

Although Honda has its own two-wheeler production unit in Gurgaon, it has a 26 per cent stake in the country’s largest two-wheeler maker.

According to media reports, while Honda was planning to sell 20 per cent stake to the other promoter, Munjal family of the Hero Group, it was looking at selling the remaining six per cent to private equity firm KKR.

"We have already conveyed earlier that the Hero Group and Honda Motor Co, Japan , have for years enjoyed a very cordial and fruitful relation, resulting in millions of satisfied Hero Honda customers across the country and there has been no change in the relationship in any manner," Hero Group said.

"The news report is incorrect and speculative," it added.

The report of Honda’s departure led to Hero Honda’s scrip plunging to an intra-day low of Rs 1,670 after opening at Rs 1,775.10 on the Bombay Stock Exchange. Later, the scrip was trading flat at Rs 1,790, compared to yesterday's close.

Honda and the Hero group hold 26 per cent each in Hero Honda, the world's largest two-wheeler maker. However, there has been market speculation that there is unease between the partners after the Japanese firm decided to enter the Indian two-wheeler market through its wholly-owned subsidiary Honda Motorcycle & Scooter India (HMSI).

In 2004, the Hero group and Honda had extended their agreement for 10 years, under which the Japanese partner would continue to provide technology to the JV. It will come up for renewal in 2014.

HMSI has announced an investment of Rs 500 crore to set up its second plant near Bhiwadi (Rajasthan), with an annual capacity of six lakh units.

New Delhi, August 31
Just months after sorting out the differences between the Department of Telecom (DoT) and the Ministry of Defence (MoD) over the release and auction of spectrum for 3G services in the country, the Group of Ministers (GoM) headed by Finance Minister Pranab Mukherjee may have on hand other issues between the two government departments to solve.

The DoT and the MoD are heading for another showdown, this time over release of 3G spectrum for the CDMA mobile operators in the country and the waiver of charges for the spectrum being used by the three armed forces of the country.

With the MoD refusing to vacate the 3G spectrum for CDMA operators, thereby ending the possibility of the government carrying out auctions of these airwaves, the DoT now seems to be linking the issue of spectrum charges to be paid by the armed forces to get solution to the former problem.

The government had earned a staggering over Rs 67,700 crore from the auction of the 3G spectrum in the GSM segment and the availability of the 3G spectrum in the CDMA sector would have further swelled its kitty.

However, the MoD has refused to vacate the spectrum and has, in fact, sought exclusive rights for it.

There had been a series of meetings between the representatives of the defence forces and from the communications ministry, but without any solution.

In an apparent reaction of the stance of the armed forces, the DoT has now turned down the armed forces’ demand for a permanent waiver of spectrum charges on all airwaves used by them.

The defence forces had sought a waiver stating that they did not derive any commercial gains from these airwaves, as these were only used for their internal communication services.

Mumbai, August 31
A day after Mukesh Ambani's Reliance Industries announced acquisition of a 14 per cent stake in East India Hotels (EIH) at Rs 182 per share, the company's share price tanked sharply as analysts warned that the hotel company was hugely overvalued. Shares of East India Hotels (EIH) closed more than 7 per cent down at Rs 139.95. The scrip opened at Rs 180.80 before touching the day's low of Rs 137.

EIH owns a number of prime properties across India and abroad, including The Oberoi, Mumbai; The Oberoi Udaivilas, Udaipur; The Oberoi, New Delhi; The Oberoi, Bangalore; The Oberoi Grand, Kolkata; The Oberoi Vanyavilas, Ranthambhore; Trident, Mumbai, and Trident, Bandra Kurla, Mumbai. The company's subsidiaries include Mercury Car Rentals Limited, Mashobras Resort, Oberoi Kerala Hotels and Resorts, Mumtaz Hotels, EIH International, EIH Flight Services, Mauritius and EIH Flight Catering Services.

Analysts covering the company recommended investors to sell EIH on the grounds that it would underperform in the coming quarters.

The acquisition impacted the stock of RIL as well. The scrip was down more than 3 per cent in both the exchanges. On the BSE, RIL closed at Rs 918.85 and on the NSE it was Rs 919.20 at the end of the day.

Though RIL insisted that it was merely an investor in EIH, the acquisition which comes on top of purchases of shale assets in the US puzzled analysts and investors alike.

Chandigarh, August 31
Mitsubishi Heavy Industries Air Conditioners, which launched its operations in India in 2006, is targeting over 120 per cent growth in turnover from India this year. The company is also looking at a pan-India presence by December.

The company, which is into a strategic alliance with Mahajak Airconditioning Company, is eyeing a turnover of Rs 150 crore by December this year, as compared to a turnover of Rs 66 crore last year. The growth driver for the company will be the launch of high-end air conditioners, including hybrid and energy-efficient air conditioners. As against 22,000 units sold by the company last year, it is expecting to sell 50,000 units this year.

Talking to TNS here today, Atul S. Trivedi, Asia head, Mitsubishi Heavy Industries Air Conditioners, said as the company gains foothold in the Indian market, it will be setting up a production facility in India. “At present we are getting completely built units (CBUs) of room air conditioners and semi-commercial air conditioners from Thailand. As the economies of scale are achieved, we will be setting up a manufacturing facility here,” he said. Trivedi said their target was to sell over one lakh units in the next year (2011), which would set base for them to start a production facility here.

In town to meet the company’s channel partners, Trivedi said they are also looking at having a pan- India presence by appointing more sales and service channel partners. “From the present 328 channel partners, we are looking at having over 400 channel partners by the end of this year. We will also be opening three new branch offices at Kochi, Indore and Patna, thus taking the number of branch offices to 17 by December,” he said.

He said though they did not have any immediate plan to market chillers (commercial air conditioners) in India, they would enter this segment in another five years.