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Sensex tumbles 546 points
Budget 2011-12 Wishlist
Silver hits record high at Rs 50,500
JFW to set up Dunkin’ Donuts outlets in India |
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Reliance-BP deal
Boost domestic demand to sustain Asia’s growth: ADB
PFC appoints merchant bankers for FPO
Rupee loses 36 paise
Food inflation up at 11.49 pc
Dishtv crosses 10 million subscriber mark
S&P ups RIL’s credit outlook to positive
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Sensex tumbles 546 points
Mumbai, February 24 Sensex ended the day with a loss of about 546 points - steepest single day fall in 18 months. Weak global cues because of political turmoil in the Middle-East and nearby region impacting oil supplies, as well as expiry of monthly derivatives contracts, worsened the trading sentiment. The Bombay Stock Exchange benchmark index Sensex, which had lost over 260 points in last two trading sessions, rolled down further by 545.92 points to close at 17,632.41. It touched the day's low of 17,559.70. The gauge has suffered such a whopping fall after August 2009. In similar fashion, the broad-based National Stock Exchange index Nifty broke two crucial levels of 5,400 and 5,300 mark level to close with a hefty loss of 174.65 to 5,262.70, after touching the day's low of 5,242.50. The melting stocks received a further jolt, following reports of some big-wigs coming under the scanner of investigating agency in the 2G spectrum allocation scam. Food inflation rose to 11.49 per cent for the week ended February 12, from 11.05 per cent the previous week. The gauge has lost 8.2 per cent since the RBI hiked interest rates for the seventh time on January 25 and revised upwards its inflation estimate. Brokers said a rise in food inflation and surging global crude oil prices raised concerns that the Reserve Bank of India might soon jack up interest rate for eighth time. They said unrest in Libya and the Middle-East, the leading oil suppliers might hamper global economic growth. The markets might be in jittery mood until the presentation of the Union Budget next week, they added. The financial stocks suffered the most on fears that rising interest rates might reduce demand for loans. The banking index dropped by 3.97 per cent to 11,616.59 followed by consumer durable by 3.89 per cent to 5,601.78. The heavy machinery stocks were down as any slow down in the economic growth would directly effect the sector. The segment index dropped by 3.77 per cent to 12,386.74. The auto sector was battered on both counts - shooting oil prices as well as interest rate hikes. The auto sector index fell by 3.52 per cent to 8,189.39 as Tata Motors, Mahindra and Mahindra and Hero Honda fell sharply. With the selling pressure spreading over a wide-front, midcap sector index dropped by 2.91 per cent to 6,367.79 and smallcap index by 2.77 per cent to 7,814.04. — PTI |
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Budget 2011-12 Wishlist
Chandigarh, February 24 As the Finance Minister Pranab Mukherjee gets ready to present his Budget for 2011-12, the only concern for the common man is that this Budget should deal with the volatile food prices and paves the way for more credit to the agriculture sector, so as to boost food production and keep food prices in control. Though the food inflation has now eased to a nine-week low of 11.05 per cent, prices of most fruits, dairy and poultry products as well as refined oils have continued to be high. Even hike in prices of petrol has played havoc with the household budgets for the past three months. Harpreet Chatha, a housewife from Jalandhar, said though a multi-pronged strategy is required to control food inflation, the least expected of the Finance Minister is to make sufficient financial outlay for boosting agriculture production, and for research and development to increase crop productivity. “If the government leads the way in making the country a food surplus state, it will definitely ease the food inflation,” she said, adding that the current high prices of food and petrol consume more than 80 per cent of the household budget. Other than their concern over food inflation, the common man hopes that the current basic exemption limit of Rs 1.60 lakh be increased to Rs 2.50 lakh. They also look forward to enhancement of deduction under Section 80 C of Income Tax, from Rs 1 lakh to Rs 2 lakh . “For women, this could be enhanced to Rs 3 lakh and for senior citizens to Rs 3.50 lakh. The existing range of slab rates should also be widened, thereby reducing the effective tax burden on individuals. The 10 per cent tax rate could be made applicable for income between Rs 2.50 lakh to Rs 5 lakh, which would be good for the lower and middle income groups,” said Sushma Sood, a small savings agent in Panchkula. With the medical expenses, too, having shot up over the past few months, the common man also hopes for a hike in the medical reimbursement limit. Manmohan Lal, a senior citizen from Mohali, said the medical reimbursement limit of Rs 15,000 should be raised to a minimum level of Rs 50,000. “The deduction in respect of medical insurance policies should also be enhanced to Rs 50,000. This will make it possible for everyone to get the maximum of a medical insurance cover,” he added.
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Silver hits record high at Rs 50,500
New Delhi, February 24 Trading sentiments turned bullish for the yellow metal as it fluctuated near a seven-week high in global markets on concerns that tensions in Libya and the Middle-East and high inflation will boost demand for the metal as a safe haven. In global markets, gold rose by $12.70 to $1,411.70 an ounce and silver to its highest in 31 years by 1.45 per cent to $33.54. Besides, hectic buying by jewellers and retail customers for the ongoing marriage season and investors shifting funds from equity to bullion, further bolstered the trading sentiments. On the domestic front, gold of 99.9 and 99.5 per cent purity surged by Rs 300 each to Rs 21,240 and Rs 21,110 per 10 grams, respectively. Sovereign followed suit and shot up by Rs 200 to Rs 17,200 per piece of eight grams. — PTI
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JFW to set up Dunkin’ Donuts outlets in India
New Delhi, February 24 Jubilant that has been in talks with Dunkin’ Brands Inc, that owns Dunkin' Donuts' for two years has been appointed as exclusive master franchisee for the brand in India. "We believe that Dunkin' Donuts brand is extremely relevant for India not only due to its strength in donuts and coffee, but also due to differentiated food and beverages menu," JFW Co-Chairman Hari S Bhartia told reporters. The firm did not comment on the number of Dunkin' Donuts stores to be opened or the investment planned, but said it is a venture that will require very less capital expenditure. "This business requires very low capex, lesser than a Dominos store, and has high return on investment. The investments will be made from internal accruals and we have cash reserves," JFW CEO Ajay Kaul said. As part of the agreement, JFW will set up the first Dunkin' Donuts store by early next year, although it did not specify the location, and expand gradually in the first couple of years. "We expect that every single store will become cash positive in one year of opening," Kaul added. Commenting on the partnership, Dunkin' Brands CEO Nigel Trivis said: "Expansion in India is a part of Dunkin' Donuts' international growth plan and we focused very clearly on JFW as they are a very successful group and they have done a credible job with Dominos." In 2010 Dunkin' Donuts global sales were $6 billion. — PTI
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Reliance-BP deal
New Delhi, February 24 Reliance is selling 23 oil and gas blocks it along with partners like Niko and Hardy had won under various rounds of New Exploration Licensing Policy (NELP) rounds since 1999. NELP allows firms to sell or farm-out participating interest (or stakes) subject to NOC from consortium partner, an official said. Niko has 10-15 per cent in three gas discovery blocks of Reliance, including the prolific KG-D6, while Hardy has 10 per cent stake each in Krishna Godavari basin D9 and D3 blocks. By virtue of these stakes both Niko and Hardy have pre-emption rights and so the application that Reliance will make for transferring its stake to BP will have to be accompanied by a lot of documents, primary among them being the NOC of its consortium partners, he said. "Without NOC, the government approval cannot be given," the official said. The application along with the requisite documents will have to be submitted to the regulator Directorate General of Hydrocarbons (DGH) who after examining will forward an in-principal approval to the Petroleum Ministry. The official said the ministry after going through the application would approve and the file will go back to DGH. DGH then will make an Amendment to the Production Sharing Contract which will be submitted to the ministry and upon its approval will the deal be said to have received government nod. The entire process may take at least 2-3 months, he said. The Europe's second biggest oil company had on February 21 agreed to a $7.2 billion deal for buying 30 per cent stake in 23 out of 29 exploration blocks held by Reliance. Reliance has said both its partner Niko and Hardy have right to raise their stake by 30 per cent of their current holding. Niko holds 10 per cent stake in the Reliance's prolific eastern offshore KG-D6 block and gas discovery block of NEC-25 off the Orissa coast. It also holds 15 per cent in Mahanadi basin block MN-D4. — PTI
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Boost domestic demand to sustain Asia’s growth: ADB
Seoul, February 24 Haruhiko Kuroda told a Seoul forum that the 2008-9 global crisis had highlighted the risk of unbalanced growth. "Developing Asia needs to strengthen its domestic and regional demand... it must show that it can also consume and invest wisely," he said. Asian economies led the world out of recession when traditional markets faltered, Kuroda said, with the region attaining an estimated 8.6 per cent economic growth in 2010. The figure was expected to fall to around seven percent this year as trade slows, Yonhap news agency quoted him as saying.
To achieve long-term sustainable growth, Asia must generate more domestic demand without undermining trade, Kuroda said. He called for a diversification of export destinations within Asia as well as to other emerging regions such as Latin America and Africa. Kuroda also stressed the need to invest in infrastructure. "According to ADB estimates, $8 trillion is needed through 2020 just to keep infrastructure in line with growth projections in Asia," he said. The ADB president called for a higher level of regional integration in Asia. A single Asian currency would come into being in the long run, he said. But this was likely to take a few decades since it would involve political decisions and the establishment of a single regional market. —
AFP |
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PFC appoints merchant bankers for FPO
New Delhi, February 24 "Goldman Sachs, JM Financial, DSP Merill Lynch and ICICI Securities have been chosen to handle PFC's follow on public offer (FPO)," PFC Chairman and Managing Director Satnam Singh told reporters here. Earlier this month, the Cabinet Committee on Economic Affairs had approved the FPO of PFC. The company will also infuse 15 per cent fresh equity by issuing 17,21,65,005 shares of Rs 10. The offer would comprise 5 per cent disinvestment of the government's share in PFC through putting 5,73,88,335 crore shares of Rs 10 on sale. At the current market price, the issue is likely to fetch Rs 5,656 crore. When asked about the company's plan to enter the capital capital market, Singh said, "we are still working on the Draft Red Herring Prospectus (DRHP) and the FPO is likely to hit the markets in the first quarter of the next financial year." The government holds 89.78 per cent stake in the public sector company. The market capitalisation of PFC at present stands at Rs 28,854 crore. After the proposed FPO, government's stake may go down to about 85 per cent. The reservation of equity shares for PFC employees are subject to the limit prescribed for retail investors by SEBI, which will not exceed 0.12 per cent of the issue size. — PTI
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Rupee loses 36 paise
Mumbai: The rupee on Thursday fell sharply by 36 paise against the US currency due to heavy month-end dollar demand from importers following high crude oil prices and a hefty decline in
equity markets.
The rupee settled at 45.48/49, a steep fall of 0.80 per cent, or 36 paise over the previous close. Heavy month-end dollar demand from importers, mainly oil refiners, following rising global crude oil near two-year high pulled the rupee down, dealers said. — PTI |
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Food inflation up at 11.49 pc
New Delhi, February 24 Food prices moved upwards on account of rise in prices of egg, meat, fish, milk and vegetables, according to the Wholesale Price Index (WPI) data for the week ended February 12 released today. The food inflation had dropped to 11.05 per cent in the first week of February from 13.07 in the previous week, which was also a decline from the numbers for week ended January 22. Terming high food inflation as a matter of concern, the Prime Minister in Lok Sabha said the situation has improved and expected the situation to improve further. Singh, however, exuded confidence that the overall inflation will come down to seven per cent by March-end on the back of steps being taken by the government. — PTI |
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Dishtv crosses 10 million subscriber mark
New Delhi, February 24 "Dishtv has became Asia's first DTH company to acquire 10 million subscribers. Dishtv attained this leadership position with an unparallelled over 1 million subscriber additions in less than three months," Dishtv said in a statement. The company claimed to have reached the nine-million subscribers mark in November last year. Dishtv, a part of the Essel group, said it expects to close the ongoing fiscal with over 3.5 million additions. According to analysts, the DTH subscriber base stands at about 28-30 million subscribers with monthly additions of about 1,00,000 users. — PTI |
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S&P ups RIL’s credit outlook to positive
New Delhi, February 24 "Standard & Poor's Ratings Services (S&P)... revised its outlook on India-based RIL to positive from stable," it said. It further added: "We revised the outlook to positive to reflect our expectation that RIL's financial profile would improve and that the company's exposure to India's country risk would reduce after its proposed partnership with BP Plc." S&P also affirmed the 'BBB' long-term corporate credit rating on RIL and the 'BBB' issue rating on the company's senior unsecured notes. 'BBB' rating signifies adequate capacity to meet financial commitments. Earlier this week, Europe's BP Plc agreed to pay $7.2 billion for 30 per cent stake in most of Reliance Industries' oil and gas blocks, including the gigantic eastern offshore KG-D6 fields. The company will receive the amount over the next 10-12 months, subject to necessary regulatory approvals. "The transaction would significantly improve its (RILs) liquidity position, resulting in lower debt (after adjusting for cash and cash equivalents of more than $1.5 billion). "Lower debt, in turn, would improve RIL's ratio of adjusted debt to EBITDA (Earnings before interest, taxes, depreciation and amortisation)," S&P said. — PTI
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Silver crossed the coveted Rs 50,000 per kg mark today by rising Rs 1,200 to Rs 50,500 per kg, while gold surged to an all-time high of Rs 21,240 per 10 grams, an increase of Rs 300 from its previous close, on brisk buying by jewellers for the ongoing marriage season.