New Delhi, April 13
In line with the past trend of declaring high dividends, Hero Honda today announced an interim dividend of 3,500 per cent of Rs 70 per equity share of Rs 2 each.

This dividend will result in an outflow of Rs 1,400 crore. The company had cash reserves of Rs 5,000 crore before the announcement of this dividend.

The interim dividend was even higher last year when the company declared a silver jubilee special dividend of 4,000 per cent or Rs 80 per equity share of Rs 2 each.

In its board meeting held on Wednesday, the company considered and declared “an interim dividend at the rate of 3,500% that is Rs70 per equity share of Rs2 each”, Hero Honda said in a filing.

The Indian promoter of the two-wheeler maker, the BM Munjal family, has bought out the entire 26% stake of the Japanese promoter Honda Motor Co in Hero Honda for Rs3,841.83 crore. The process of Honda exiting the joint venture was completed this month.

The Hero Honda stock closed up 5.86 per cent at Rs 1,735 on a bouyant day.

Hero Honda has been a high-dividend paying company and since it generates a lot of cash through profitability and invests in capacity expansion prudently and strategically.

It has a huge cash reserves from which it pays dividends to shareholders as otherwise too much cash would sit on its balance sheet. Paying high dividends is a way of rewarding shareholders.

Since manufacturing two wheelers is its only business, it does not have businesses which are capital intensive.

Chandigarh, April 13
Chandigarh may have just a few hundred acres of farm land, but banks in the city disbursed more than Rs 3,990 crore as agriculture loan between April — December 2010, for direct and indirect farming activities in the city. Total outstanding agriculture loan in the city is Rs 8,308 crore.

Considering the fact that agriculture loan is available at 4 per cent interest (because of 3 per cent interest subvention), it is possible that the loan taken as agriculture loan is actually being diverted for non-agriculture purposes.

The Central government is investigating whether loans meant for the agriculture sector are actually being diverted in commercial real estate. Residents of Chandigarh and Delhi are learnt to have taken huge amounts as agriculture loans.

Loans granted in these two cities are more than the total agriculture loans granted in four major agriculture producing states of Uttar Pradesh, Bihar, West Bengal and Jharkhand.

The figures collected by The Tribune from the state level bankers committee (SLBC) for Chandigarh, state that it is mostly the nationalised banks that have been benevolent in extending agriculture loans. Total outstanding loan for agriculture by nationalised banks in the city is around Rs 7,807 crore.

This data also reveals that of the Rs 3,993.82 crore disbursed for agriculture between April and December last year, a major portion (Rs 2046.07 crore) was disbursed for direct agriculture activities.

Bankers in the city feel that the matter needs to be looked into as such a huge amount is unlikely to be spent on agriculture operations in Chandigarh. 

New Delhi, April 13
Fromer telecom minister and six business executives indicted in the country's biggest case of corruption went on trial on Wednesday, but the hearing was deferred to settle last- minute bail applications from the defendants.

Andimuthu Raja along with top officials from the Indian joint ventures of Norway's Telenor and the United Arab Emirates' Etisalat , are charged with manipulating the grants of mobile phone licences in the world's fastest growing telecoms market.

Three executives from Reliance ADA, owned by billionaire Anil Ambani, are also on trial for the scandal which may have lost India $39 billion in revenue, according to the state auditor, a sum equivalent to the country's defence budget.

Raja was forced to resign last year and was later arrested, along with several other former government officials and executives.

On Wednesday, Raja and the other defendants pushed their way through a scrum of lawyers, reporters and court officials packed into a small court room in the Indian capital. The former minister, dressed in a dark safari suit, smiled at the onlookers but did not make any comment.

As Raja entered court, the fate of his regional DMK party was being decided in local elections in southern Tamil Nadu. Most analysts expect the DMK, a key ally of Congress to lose power because of the backlash from the scandal.

Judge OP Saini asked the police to explain why bail should not be granted to the three Reliance ADA officials; Sanjay Chandra, managing director of Unitech which is the local partner of Telenor , and Vinod Goenka, a director of Etisalat's India partner.

The next hearing was set for Friday.

Apart from Raja, police have arrested Shahid Balwa, the vice chairman of Etisalat's India operations and other executives and former government officials. — Reuters

New Delhi, April 13
Reliance Industries Ltd (RIL) today announced that it had started implementation of its large-scale projects in India across the polyester chain. This is part of the $9-billion investments in polyester capacity announced by RIL chairman, Mukesh Ambani.

Sources said the investments will be done in a phased manner. This is RIL’s largest capacity expansion in the sector and is aimed at consolidating its position as the world’s largest integrated polyester producer. A company statement said these investments in polyester capacity would also strengthen India’s position as a global manufacturing hub for textiles and fibre.

Global supply constraints, substantial price increase and uncertain outlook for cotton availability is creating considerable substitution opportunities for polyester products like Polyester Filament Yarn (PFY) and Polyester Staple Fibre (PSF).

Polyester is expected to capture around 80% of incremental global fibre demand of around 2.9 million tonnes a year over the medium-to-long term. Demand for Polyethylene Terephthalate (PET), which is already India’s fastest growing polymer, is also poised for exponential growth due to continued demand from bottling, packaging and food & beverages sectors.

With strong manufacturing presence in India & Malaysia, cost leadership position and wide product range, Reliance would benefit from this market growth, the company statement added.

RIL has planned its capacity expansion in phases. This includes a planned capacity of 2.30 million tonnes of PTA at Dahej with the ability to increase it by another 1.15 million tones, later. These plants will be integrated with the Paraxylene plants at Jamnagar for raw material and will cater to new polyester plants.

All these projects are under various stages of implementation ranging from technology licensing, basic engineering and obtaining necessary regulatory approvals. 

New Delhi, April 13
Jacob Mathew, Executive Editor of the Malayala Manorama Group of Publications, has been unanimously elected the President of WAN-IFRA at its Annual General Meeting in Dublin, Ireland. He is the first Indian and second Asian, after Dr. Seok Hyun Hong of Korea, to be elected to this office.

Jacob Mathew succeeds Gavin K O’Reilly, Group Chief Executive Officer of The Independent News and Media Group, Ireland on July 1, 2011. Tomas Brunegard, CEO, Stampen Group, Sweden was elected the Vice President.

WAN-IFRA based in Paris (France) and Darmstadt (Germany) is a global organisation of Newspaper Editors and Publishers. It represents more than 18,000 publications, 15,000 Online sites and over 3000 companies in more than 120 countries.

The World Association of Newspapers, founded in 1948 and IFRA, the Research and Service organisation founded in 1962, merged in 2009 to form WAN-IFRA.

Jacob Mathew is currently a trustee of the Press Institute of India/Research Institute for Newspaper Development and is also on the Asia Board of INMA (International Newspaper Marketing Association). He has also served on the board and the Executive Council of the World Association of Newspapers. 

New Delhi, April 13
Singapore-based SingTel, the main partner in the country’s largest telecom company Bharti Airtel, has increased its stake to 32.25 per cent with the purchase of shares worth about Rs 93 crore.

In a filing with the BSE, SingTel said that it had bought 28.30 lakh shares of Bharti Airtel through an open market purchase for an aggregate cash consideration of Rs 93.4 crore through its subsidiary Viridian Ltd.

The newly-acquired shares account for about 0.1 percentage point stake in Bharti Airtel, which is jointly promoted by SingTel and group companies of industrialist Sunil Mittal’s family.

At the end of December, SingTel owned 15.72 per cent in Bharti Airtel directly through its wholly-owned subsidiaries Pastel (15.57 per cent) and Viridian Ltd (0.15 per cent), while the rest was held indirectly by the parent company. All promoters together held nearly 68.2 per cent stake in Bharti airtel, including 45.48 per cent by Mittal group firm Bharti Telecom as on December 31, 2010.

Among other shareholders, LIC has little over 5 per cent. In January this year, Viridian had purchased 40.75 lakh shares of Bharti Airtel via open market for Rs 136 crore taking its effective shareholding in airtel to 32.15 per cent.

“The purchase consideration was determined by the prevailing market price of Airtel on the relevant stock exchange,” SingTel said.