Mumbai, November 9
Riding on strong retail and institutional demand, the Rs 7,600-crore Power Grid Corporation's follow-on offer was oversubscribed 1.08 times on the first day today.

The state-run transmission firm's FPO attracted bids for for 90.53 crore shares against 84.17 crore shares on offer on the first day, as per the data available on the National Stock Exchange website. While QIB portion was subscribed 2.09 times, the retail category was subscribed 0.06 times.

The government is divesting 10 per cent of its 86.36 per cent stake and the company would raise equal percentage of fresh equity through the offer priced at Rs 85-90 per share.

At the upper end of the price range, Power Grid's FPO is worth nearly Rs 7,600 crore and at the lower end, it would fetch about Rs 7,155 crore.

The FPO closes on November 11 for institutional investors, while for other investors bidding will close on November 12.

PowerGrid's FPO is part of the government's plan to raise Rs 40,000 crore in the current financial year through divesting stake in various PSUs.

The capital raised from the FPO will be used for part funding the PSU's Rs 55,000 crore capex plan, with Rs 30,900 crore worth of investment lined up over the next two years. — PTI 

Abohar, November 9
The spot price of raw cotton has hit historic highs in Punjab at Rs 5,000 per quintal. Increased demand of raw cotton from domestic spinning and textile mills coupled with speculative transactions (satta) has made has created a shortage. Cotton growers have started holding back their produce in anticipation of the fact that prices could go up further.

“The situation is unprecedented and cotton markets have become unpredictable. What is happening is beyond comprehension of those considered masters of cotton trade in this region,” said Pardeep Shardha, a leading cotton businessman of North India, adding prices of raw cotton now stand at between Rs 4750 and Rs 4950 a quintal in the region.

Cotton prices had touched Rs 5000 in Rampura market. Even the average quality cotton had been fetching Rs 4,750 to Rs 4,950 a quintal in different markets of Punjab. In Haryana and Rajasthan prices had not yet touched such steep levels.

A cross-section of cotton trade experts of the region while talking to The Tribune pointed out that prices had risen around 60%. Traders were afraid that rates could even double this year

What is mystifying the traders is that there is no explicit reason for the prices shooting up. The central government had allowed export of 55 lac bales this year compared to 85 lac bales, last year. Not only this, the crop size in the country was expected to be normal this year.

Ashok Kapur, former president, Northern India Cotton Association (NICA), said demand of raw cotton was very high in the domestic sector as existing spinning and yarn manufacturing units had expanded respective capacities and a number of new spinning and yarn manufacturing units had come up in Punjab and Himachal Pradesh.

He added that so far eight lac bales had arrived in cotton markets of Punjab, Haryana and Sriganganagar circle of Rajasthan. About 32 lacs bales more were expected to arrive in the entire season.

Meanwhile, a section of spinning and yarn manufacturing unit owners have started purchasing raw cotton directly from the doorsteps of growers in rural areas so that they can gather enough stock to run their plants at optimum level. 

Chandigarh, November 9
Haryana is all set to be the new battle ground for mobile operators, with the Mobile Number Portability (MNP) service set to be rolled out here from November 25. With customer retention being the priority, most operators in the state are busy making their business plans to thwart any attempt from competitors to erode their customer base.

The operators are busy in getting their systems in place for MNP, besides consolidating their existing user base.

Most operators fear it is the new subscriber with each service provider that can switch loyalties or migrate to another service provider, especially as MNP can be availed for just Rs 19.

“While the operators’ network have tested this system and are technically ready for the launch of service, MNP will be a game changer in the telecom sector. We are having a meeting on November 11 to discuss the readiness of the system for MNP to form our strategy on business plans,” said a senior official in Bharti Airtel.

Talking to TNS here today, a senior official in Idea Cellular said they are now in the process of identifying their high revenue generating customers, especially those who have been with them for the past many years. “We are contemplating having special plans and offer incentives and value-added services to these ‘high tenure’ customers,” he said.

So even as the old service providers are busy making new business plans, the new entrants in this telecom circle are looking forward to increasing their subscriber base. Tata Teleservices, which has a subscriber base of 2.8 million in Haryana, feels that a lot of “disgruntled” subscribers from the older operators will migrate to their network. “We have launched Tata Docomo less than two years ago. Our subscribers chose us over other existing service providers based on our network and VAS, so we will not have a problem of retention of old customers. With the launch of our 3G services, we will definitely be more attractive for the subscribers after MNP is launched,” said Aditya Gupta, COO, Tata Teleservices.

New Delhi November 9
Essar Africa Holdings Limited (EAHL), a privately-held company of the Essar Group today confirmed that it has received official notification from the Zimbabwe government for its selection as the preferred bidder for revival of Zimbabwe Iron and Steel Company (ZISCO). Essar will purchase the government's 60% equity interest and has been invited to finalise the terms and conditions to complete the transaction, according to a statement.

Essar Group’s current operations in Africa include oil and gas assets in Nigeria , Kenya and Madagascar , telecom assets in East Africa, BPO operations in South Africa and coal concessions in Mozambique.

ZISCO is an integrated steel company with an annual capacity of one million tonnes engaged in manufacture of long products. ZISCO’s operations are situated in Redcliff with distribution centres in Kwekwe and Harare . ZISCO derives raw material security through its subsidiary Buchwa Iron Mining Company (BIMCO) which owns and operates several iron ore mines and limestone quarries.

ZISCO has been operating at low capacity levels for the last several years due to shortage of working capital, and funds for maintenance / modernization of plant and equipment. As part of its proposal, Essar will invest in the revival & expansion of ZISCO and enhance its productivity by leveraging Essar’s expertise in the steel sector, ZISCO’s existing infrastructure and availability of key raw materials including coal and iron ore.

Firdhose Coovadia, Resident Director, Essar (Middle East & Africa ) said “We are delighted to have been selected as the preferred bidder for the revival of ZISCO. We believe ZISCO is well positioned to be a low-cost steel producer that can meet the growing demands of the regional steel market and capitalize on the robust forecasted growth in sub Saharan Africa. We also recognize ZISCO as a vital and strategic asset for the Zimbabwean economy.” 

Chandigarh, November 9
Tata Docomo, the GSM arm of Tata Teleservices, is expecting that up to 20 per cent of its existing customers in Punjab and Haryana will switch over to its high speed 3G services within the next one year.

Announcing the launch of its 3G services in Punjab, Haryana and Chandigarh here today, Aditya Gupta, COO, Tata Teleservices, said they are expecting 10 to 20 per cent of their existing customers in Punjab and Haryana to shift to 3G network within the next months to one year.

“We will be aggressively promoting 3G services through our 35,000 multi-brand retail outlets in Punjab and Haryana. We will also set up demonstration zones at 100 locations in both states to give a live experience to people on the features of 3G services," he said.

Tata Teleservices has a subscriber base of 2.9 million in Punjab and 2.8 million in Haryana. Though the company refuses to divulge details about the break-up of its GSM and CDMA subscriber base, it claims that 3G service in GSM will not affect its CDMA subscriber base. 

Hyderabad, November 9
The Insurance Regulatory and Development Authority has received proposals for Merger and Acquisitions (M&A) from two non-life insurance companies, Chairman J Hari Narayan said today. However, he declined to disclose the names of the companies and details of their proposals saying they were "confidential".

The IRDA chief was speaking to the media on the sidelines of a function organized by SBI Life Insurance to launch its customer care initiative called SMS Solve which enables customers to register grievances using their mobile phones.

“There is no specific provision in the Insurance Act with regard to Mergers and Acquisitions of non-life insurance companies. Nevertheless, no specific guidelines are currently required for the process to start” Narayan said.

On the other hand, he said, there was already a provision in the Insurance Act regarding M&As related to life insurance companies. Hence, the M&A proposals from life insurers could be dealt with according to the existing provisions.

Replying to another question, Narayan said that the impact of the insurance regulator?s new rules for unit-linked insurance plans (Ulips) would be assessed after this financial year.

Though there was a decline in the business income of insurance companies in September due to the new norms compared with August this year, "the dip is not much. I expect the same trend to continue in October," he said, adding that the situation could be better in 2011-12.

The next agenda of the insurance regulator, according to Narayan, is to enhance policy holder protection. Accordingly, IRDA is trying to enable the insurance industry to enhance policy holder protection. Pointing out that health insurance was a "matter of great concern", he said that reforms in the health insurance sector was a continuous process.

Meanwhile, Narayan launched SBI Life?s ?SMS Solve?, a first-of-its kind customer care initiative by any life insurance company in the country.

'The introduction of this initiative is a reflection of our commitment towards constantly enhancing our customer service capabilities so as to provide our customers constant reassurance and convenience,'' said M N Rao, MD and CEO of SBI Life Insurance.

Mumbai, November 9
Tata Motors today reported a massive 102-fold jump in its consolidated net profit for the quarter ended September 30 at Rs 2,222.99 crore on account of robust demand across categories.

The company had posted a net profit of Rs 21.78 crore in the corresponding period last year, Tata Motors said in a statement.

The consolidated total income from operations during the second quarter also increased by 36.48 per cent to Rs 28,782 crore from Rs 21,088.45 crore in the year-ago period, it added.

"Favorable macroeconomic conditions, good monsoons and good finance availability led to robust domestic demand during the quarter, resulting in volume growth across all segments," the company said.

BRIEFLY

ICICI Bank raises $1 bn
New Delhi: ICICI Bank on Tuesday said it has raised $1 billion (about Rs 4,500 crore) from overseas bonds. The proposed issue has been made through the bank's Hong Kong branch and the proceeds would be utilised for general corporate purposes, ICICI Bank said. — PTI

PowerGrid to shut down JV
Kolkata: Power Grid Corporation of India Ltd on Tuesday said it has decided to shut down its 50:50 joint venture power transmission consultancy business with IL&FS. Declining to be identified, sources said the company, which is the third largest transmission company in the country, did not find the expertise provided by IL&FS to the consultancy business up to the mark and accordingly, decided to end the JV. —PTI

SBI bonds in Jan
New Delhi: Enthused by an overwhelming response to its debut paper for retail investors, SBI plans to come out with another retail bond issue worth Rs 1,000 crore in the next two months. "We are planning for (retail bond issue) January. It would be in the range of Rs 500-1,000 crore," SBI Chief Financial Officer S S Rajan said. — PTI

Kotak Bank ups base rate
Mumbai: Private lender Kotak Mahindra Bank on Tuesday said it has revised its base rate upwards by 0.25 per cent to 7.75 per cent from the earlier 7.50 per cent. The bank has also upped its benchmark prime lending rate (BPLR) by 0.25 per cent to 16.25 per cent, a press release issued here stated. — PTI

Yatra.com, HDFC Bank tie-up
New Delhi: Online travel firm Yatra.com on Tuesday said it has entered into an alliance with HDFC Bank as part of its strategy to increase its customer base. The company said the partnership will avail HDFC Bank credit card holders 20 per cent discount on all domestic air bookings subject to maximum Rs 500 on the base fare. — PTI