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Cement prices likely to moderate soon
US forces Germany to stop Indian oil payments to Iran
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BHEL annual profit jumps 40% to Rs 6,021 crore
Suzlon raises stake in REPower to 95pc, eyes takeover
GAIL plans power sector foray
Merger regulation could impede growth, says CII
One year extension for Reliance Haryana SEZ
Bajaj Auto March sales up 12 per cent
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Cement prices likely to moderate soon
New Delhi, April 4 According to a research note by Bank of America Merrill Lynch, cement prices have climbed to new highs across regions. The uptrend prices that started in Oct 2010 and has gained momentum over last two quarters. Indications are that cement prices on a pan-India basis are up by an average Rs 40 a bag in March 2011, versus the third quarter. However, the note adds strong cement price increases over last 3 months seem unlikely to sustain beyond the ongoing peak demand season (Jan-Jun 2011). The increase in prices is despite feeble demand growth of 3% year on year through Oct 2010-Feb 2011. The report says it is interesting to note that in all the five regions of India, cement prices are now higher than FY08 levels when the industry’s capacity utilisation was at its peak. Bank of America Merrill Lynch says that high prices may not sustain as upcoming fresh expansions especially in south-west India from market participants like ACC, JP, Jay Jyothi, KCP could test industry’s rational pricing. “Upside to cement prices may also be capped owing to scrutiny by the Competition Commission of India (CCI) that recently asked players for an update”, it says. The report says there are indications that rational production and intensive top management review of supply dynamics as key factors behind the price increases. In the South, for example, existing units are likely to undertake 30% production cut, while new units are undertaking a production cut of 40%. Discussions indicate that most companies are still planning organic expansions led by the experience of bigger profits in 2007-08 relative to total profits in the prior decade. It says that the industry’s rational pricing efforts will be difficult to sustain on a 12- month basis. The note says that industry’s continued eagerness for expansion creates risk of structural de-rating for the industry. |
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US forces Germany to stop Indian oil payments to Iran
New Delhi, April 4 "We are working with Iran to evolve an alternate payment mechanism. We hope to firm up plans very soon," a top finance ministry official said. The problem had arose after Reserve Bank of India (RBI) in December last year scrapped a long-standing payment mechanism used to pay for Iranian crude imports. Early in March, Oil Minister S Jaipal Reddy had told Parliament that "pending dues of National Iranian Oil Company (NIOC) are now being cleared and as of March 1, 2011, payment of euro 1.5 billion has been made to the Central Bank of Iran." But that was the last payment made to Iran as soon after the news broke out, the US clamped down. Oil supplies from Iran have, however, not been affected and the Persian Gulf nation continues to sell oil on credit backed by corporate guarantee. "We are considering various alternatives... making payments in rupee is one of them," the finance ministry official said. Reddy on March 3 stated in the Lok Sabha that "consequent to the withdrawal of the Asian Clearing Union (ACU) mechanism by the RBI with effect from December 23, 2010, all payments to Iran for import of crude oil have to be settled in any permitted currency outside the ACU mechanism." India imports 12 million barrels of crude oil every month from Iran, which is the nation's second-largest supplier after Saudi Arabia. After the scrapping of the ACU, Iran, which makes up for over 12 per cent of India's oil needs, had continued to supply oil on credit despite the outstanding amount crossing a staggering USD 3 billion. Reddy then stated 21.2 million tons of crude oil was imported from Iran in 2009-10 fiscal. Mangalore Refinery imported 6.9 million tonnes, Essar Oil 5.3 million tonnes, Reliance 3.3 million tons, Hindustan Petroleum 3.2 million tons and Indian Oil 2.5 million tonnes. This fiscal, Reliance has completely stopped using Iranian oil and in first six months 8.9 million tons of oil was imported from Iran, Reddy said. Sources said as per the requirement of the German central bank, Deutsche Bundesbank (DBB) - which had permitted payment in euros through EIH - each drop of oil bought from US-sanctioned Iran was certified. First, the oil companies certified the crude oil they bought from Iran and payments that are due. This is being counter-certified by the petroleum ministry. Furthermore, State Bank of India - the banker which was routing the payments - also affixed its seal on the transactions. But the US is not agreeable to payments going through EIH and asked Germany to stop all payments. — PTI |
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BHEL annual profit jumps 40% to Rs 6,021 crore
New Delhi, April 4 "We had another successful year. The company has taken a number of initiatives. Localisation of technologies, continuous working on supply chain and lower material costs helped in good profit," BHEL's chairman and managing director B. Prasada Rao said while announcing its annual results. In the 2009-10 fiscal, it had a profit of Rs. 4,311 crore. The state-run entity raked in the profit on revenues of Rs. 43,451 crore in the last fiscal, an increase of 27 per cent as compared to Rs. 34,154 crore in 2009-10 period. Rao said change in the company's accounting policy on provision for warranty obligation for construction contracts also pushed revenues and profits higher. "This (change in accounting policy) has resulted in an increase in turnover by Rs. 2,456 crore and increase in profit before tax at Rs. 414 crore," he said. BHEL's shareholders have been paid an interim dividend of 132.5 per cent while the earnings per share in the previous fiscal climbed to Rs. 123 per share. — PTI
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Suzlon raises stake in REPower to 95pc, eyes takeover
Mumbai, April 4 The holding of Suzlon, which had first acquired stake in REPower in 2007-08, earlier stood at 91.5 per cent and the additional shares were bought in the last 2-3 weeks, the company's Chief Financial Officer Robin Banerjee told PTI over the phone. Banerjee did not disclose the exact outgo from Suzlon for the additional stake in the publicly-listed REPower, but said "a part of" the money raised by the promoters of Suzlon recently by selling 2 per cent of Suzlon was used to fund the acquisition. "The money has been given to the company as a debt from the promoter and a part of it was used to acquire the new shares," Banerjee said. Raising the stake will help Suzlon to automatically get the rest of the shareholders to sell because under German laws, a shareholder with 95 per cent holding in a company can initiate a 'squeeze-out' procedure, under which the remaining shareholders have to sell their shares. — PTI |
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New Delhi, April 4 The two firms plan to set up a joint venture for building gas-based power plants in India as well as in other countries. NTPC would also explore possibility of giving GAIL equity in its upcoming as well as expansion power projects, he said. The two firms are already partners in Ratnagiri Gas and Power Pvt Ltd (RGPPL), the firm that runs the Dabhol power plant in Maharasthra. Through the MoU, GAIL and NTPC would cooperate in commissioning of the 5 million tonnes a year LNG receipt and regassification terminal adjacent to the Dabhol power plant. "We will also explore feasibility of expanding the LNG terminal capacity as well as the power block," he said. GAIL and NTPC hold 30.17 per cent equity stake each in RGPPL. The remaining equity in the 1,967-MW power plant is with Maharasthra State Electricity Board (MSEB) and financial institutions. — PTI |
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Merger regulation could impede growth, says CII
New Delhi, April 4 Any mishandling of the competition law could have far- reaching economic implications for the country, it said in a release. The industry body also asserted that overseas global transactions should be liable to scrutiny only where both parties have some territorial nexus.Some of the provisions in the new draft guidelines include raising threshold limits by 50 per cent; a pre-merger consultation process; an endeavour to reduce the response time and fees ranging from Rs 10 lakh to 40 lakh. Indian industry seems to be satisfied with the increased merger thresholds, although some concerns remain over what would appear to be an unduly long 210-day period which is statutorily available to the Competition Commission to review mergers, even though it would endeavour to do so in 180 days, the chamber said. Without being adequately manned, the review time at the Commission could go up to 210 days in some cases, leading to a situation where the Indian regulator is holding up a worldwide transaction, it added. Moreover, under the draft regulations, any person aggrieved can file an appeal against the order of the Competition Commission, thereby causing further delay and uncertainty. Besides, since no asset transaction thresholds have been prescribed as of now, every asset - current assets or fixed asset - that is acquired after June 1 2011, would have to be notified to the Competition Commission. "This would not only conflict with the provisions of the SEBI's Takeover Code and preferential allotment guidelines but also burden the Competition Commission with large chunks of unnecessary technical filings of transactions which do not raise any Competition Law concerns", the release said. — PTI |
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One year extension for Reliance Haryana SEZ
New Delhi, April 4 "Though the developer had sought extension of the original letter of approval to March 2015, the Board decided to extend the validity (of LOA) up to March 31, 2012," he said. The official said while Reliance Haryana SEZ, promoted by Mukesh Ambani owned Reliance Industries, possesses more than 1,000 acres in the Jhajjar district in Rajasthan, it is not contiguous. The project envisages setting up of the multi-product SEZ over an area of 5,000 hectares. The delay in the project is on account of difficulties in acquisition of land from farmers.
— PTI |
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Bajaj Auto March sales up 12 per cent
Mumbai, Apr 4 The company's exports went up 7 per cent to 69,884 units in March this year from 65,134 units in March, 2010, Bajaj Auto Ltd (BAL) said in a statement. The company had sold 2,74,389 units of motor-cycles in March, as against 2,44,870 units in the same month last year. Its Pulsar and Discover brands contributed 71 per cent to total sales. BAL reported a rise of 14 per cent in three-wheeler sales in March to 33,349 units from 29,345 units in the same month last year.
— PTI |
ASSOCHAM Survey Axis Bank expansion Airtel ranked in top-5 Wyndham Hotel group |
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