The Tribune, Chandigarh, India

Tatas lose $20 bn market wealth; Ambanis $15 bn beginning July

New Delhi, August 21
Salt-to-software conglomerate Tata group, the country's largest in terms of market wealth, has also taken the biggest hit of over $20 billion in its market valuation since July.

Indian stock market has been under tremendous pressure in recent weeks, primarily due to global economic worries, and its overall valuation has fallen by an estimated $200 billion so far in the current quarter, beginning July 1.

The loss suffered by Ratan Tata-led group accounts for over 10 per cent of the overall loss in the market and is also higher than a cumulative erosion of $15 billion from the stock wealth of two Ambani groups.

While Mukesh Ambani-led Reliance Industries group has lost close to $9.89 billion, the group led by younger Ambani sibling Anil has seen little over $5 billion being eroded from its market wealth in this period.

An analysis of market wealth data of large corporate groups shows that the business houses having suffered significant erosion in their valuation also include Vedanta, Adani, ICICI, Infosys, Wipro and Jindal groups.

On the other hand, the losses have been relatively less for groups like Birla, Mahindra, Bajaj, HDFC and L&T, while that of Sunil Mittal-led Bharti group has actually seen a marginal increase of Rs 19 crore since July 1.

The Indian market's total valuation has fallen from $1.53 trillion (Rs 67,31,000 crore) at the beginning of this quarter to $1.33 trillion (Rs 59,29,250 crore) currently.

The market benchmark Sensex has dropped by over 2,500 points or about 13 per cent in this period.

Among individual groups, Tatas' market wealth has fallen from a little over $100 billion (about Rs 4,48,000 crore) on July 1 to $79.5 billion (about Rs 3,55,000 crore) — a loss of about Rs 93,000 crore ($ 21.13 billion) for the group.

During the same period, Mukesh Ambani — led Reliance group’s market wealth has plummeted by over Rs 43,000 crore from Rs 2,83,000 crore to Rs 2,40,000 crore. On the other hand, Anil Ambani group's market value has fallen by over Rs 22,000 crore ($5.03 billion) to about Rs 60,300 crore currently.

Adani and ICICI groups have lost about Rs 30,000 crore each and IT giant Infosys has seen more than Rs 40,000 crore eroded from its value.— PTI

Gold imports may cross 1,000 tonnes this year

Mumbai, August 21
Notwithstanding skyrocketing gold prices, its imports are likely to cross the 1,000-tonne mark this year on robust investment demand, say analysts. Since the US sovereign debt downgrade and the new threats emanating from eurozone economies, gold has rallied 14 per cent this month alone, as investors shunned stocks and flocked to the yellow metal as a safe haven.

In the domestic market, gold scaled a new high of over Rs 28,150 per 10 gm in futures market, while in global markets it hit a record $1,877 an ounce last Friday. In the domestic market, on that day gold rose as much as Rs 1,310, the highest ever single day gain, they said.

“With rising prices, investment demand is likely to grow, especially in the gold ETFs (exchange traded funds) and coins, in expectation of better returns,” brokerage firm Maya Iron Ores Vice-Chairman Praveen Kumar said. — PTI

Plan Panel pitches for hike in power tariffs

New Delhi, August 21
Stating that suppressing of energy prices would not help, the Planning Commission has suggested increasing electricity tariffs while providing targeted subsidy for poor people.

"... electricity tariffs are lower than they should be for many categories of consumers over (and) above that of agriculture, which jeopardises the financial position of the discoms.

"A transition to more rational energy pricing requires upward adjustment in all these prices," according to the Approach Paper for the 12th five-year Plan (2012-17).

Noting that electricity to the consumer is underpriced, the Approach Paper pointed out that most state regulators have shown a tendency to hold back tariff adjustments, typically under political pressure.

"Suppressing energy prices will not help. There is a case for insulating the poor from these prices increases by a targeted subsidy but what we have at present is a much more general subsidy," it pointed out.

Most of the power distribution companies (discoms) in the country are in poor financial health, especially as they are adversely impacted by a mismatch between power tariffs and cost incurred in generating electricity.

Losses incurred by discoms are estimated to have touched about Rs 70,000 crore in 2010-11. These losses are projected to further rise to as much as Rs 1,16,000 crore by 2014-15.— PTI

Fashion designers sense huge market in hinterland

Mumbai, August 21
Small towns? Indian fashion designers say it’s a sleeping giant of a market that is slowly waking up. Two- and three-tier cities have spelt huge potential business for designers, thanks to growing awareness, fashion consciousness and greater purchasing power. And they are tapping it fully through brick-and-mortar stores and even online portals.

After developing a steady clientele in metros like New Delhi, Mumbai, Bangalore and Chennai, designers have now also started retailing in places like Surat, Nagpur, Goa, Pune and Ahmedabad.

“There is a demand for designerwear in small cities because India is getting richer, people are getting more aspirational, they hear about labels and they know about fashion,” celebrated couture designer JJ Valaya told IANS on the sidelines of the ongoing Lakme Fashion Week Winter/Festive 2011.

“I think two- and three-tier cities are now ready for Indian fashion. I think it's a matter of time that designers go all out and reach out to people in the small cities. Some have already started,” he added.

Valaya also said designers should indulge in pret collections if they wish to create a client base among the masses.

"If you want to grow as an industry, 'Ready to wear' clothes that reach out to maximum people is the way to go, but it requires a lot of planning, infrastructure and back-hand integration and designers are slowly working on that," he said.

Designer Payal Singhal, who retails in cities like Chandigarh and Surat apart from other small towns, said: "People in small towns have become very fashion-conscious. We get e-mails from clients from cities like Surat asking us about our collections. They buy online and they know the latest trends.

"They have a lot of money and they're willing to spend it. There is a big market out there in cities apart from the metros."

According to Jai of designer duo Parvesh-Jai, there is a lot of demand for their Indian wear in small towns.

"In places like Raipur, Meerut and Ahmedabad, people are loaded with money and we sell a lot of saris and lehengas in these places. Buying capacity of people in the smaller cities has become very high," Jai told IANS.

"To uphold their social status, people in these places too have become more conscious about brands and trends and are spending money to get that latest designer outfit."

This growing phenomenon has left many designers thinking about expanding business in small towns.

"I am not opening any store in any small towns immediately but may be five years down the line, I will. I am thinking on those lines," said designer Nachiket Barve. Valaya, who launched his label almost 20 years back, has similar plans and says the logistics need to be put in place.

"I am planning to open my store in the small cities, but let's see when that happens because it has to be done on the right scale; otherwise it's not worth it. So it's still in the planning process," he said.

Some designers credit the increase in online shopping for the surge in demand for designer clothes in small cities. Online selling of designer wear by sites such as Fashion and You and Myntra have proved to be a boon - for designers as well as for small town consumers.

"In cities like Nagpur and Raipur, where there aren't many stores retailing designer outfits, people often pick clothes online. My collections are doing very well in small towns through online buying on sites like Fashion And You. I have witnessed some very good sales," said western wear designer Jatin Varma.

To take a bigger step in that direction, Varma has now collaborated with retail chain Shoppers Stop to make his prêt line available in many parts of the country.

"In India, we are launching our label with Shoppers Stop soon. So it would be like 40 stores around the country will have my collections," he said.— IANS

Tax Advice
Deduction allowed for disability is Rs 50,000
by SC Vasudeva

Q I am a pensioner and a senior citizen. My income for the assessment year 2010-11 (Financial Year 01April, 2009 to 31 March 2010) was a per details below: -

(i)Pension Rs 8,14,142.00

(ii)Interest on Bank Deposits Rs 4,10,630.00

TOTAL Rs 12,24772.00

The accrued interest on NSC purchased during past years was Rs 34,700 and NSC for Rs 1 lakh were purchased during the financial year 01 April 2009 to 31 March 2010. A total amount of Rs. 185560/- has been deducted by the banks on the amount or pension and interest on deposits. I have filed by IT return for the affected period by due date. I wish to know as to what total amount is due from me as income tax on the details as mentioned above. — LD Sharma

A On the basis of figures provided in the query the gross tax payable works out at Rs 2,51,156. After adjusting the tax deducted at source of Rs. 1,85,560, the amount of tax due would be Rs 65,596.

Tax computation

Q Kindly advise me the Tax deduction to me in the following queries as I am a retired Supdt. From Punjab State Electricity Board, Patiala.

(i) My gross pension during 2010 to 2011 is Rs 2,53,715.00

(ii) Interest in Fixed Deposit Rs. 50,383.00

(iii) Interest on Saving Deposit Rs 19,821.00

(iv) Agriculture income Rs. 40,000.00

Rs. 3,63,919.00

(v) Tax deducted from my pension by Electricity Board
Rs 1,415/

Please advise what income tax am I to deposit. Secondly, in the Tribune dated 7.6.2011 has notified that whose annual income including salary and interest is up to 5 lakh, no income tax return is required.

— KC Bhardwaj

A Net tax payable on the basis of figures given in the query would be Rs 15,469. The amount of tax has been computed on the presumption that you are not a senior citizen.

The notification regarding non-filing of return in respect of persons having income up to Rs. 5 lakh is applicable in case the following condition are satisfied.

a) The salary income should be from one employer

b) The interest, if any in savings bank account included in total income should not exceed Rs. 10,000.

c) The total income from salary and interest in savings bank account should not exceed Rs. 5,00,000/-

d) PAN and the amount of interest has been reported to the employer and

e) The entire tax on such total income has been paid by way of deduction of tax at source.

You would not be covered by the above scheme as you do not satisfy the above conditions.

Exemption for disabled

Q Please let me know what is the exemption limit for a person who has 70% disability? Last year in the newspaper it was mentioned as 75,000/- exemption from income tax.

Previously it was Rs. 50,000/- which is correct? Interest received from the savings account from the bank is taxable or exempted? Is a person aged 84 years is exempted from paying income tax from the year 2011-2012 or 2010-2011?

— Ishan

A The deduction available to a person who is not having a severe disability is Rs. 50,000/-. The interest received in savings bank account is taxable.

The exemption limit of Rs. 5,00,000/- to persons who have attained the age of 80 years or more is applicable for financial year 2011-12.

BRIEFLY

US not facing another recession: Obama
Washington: The US is not facing another recession but the nation is in danger of not having a recovery that is fast enough to deal with a genuine unemployment crisis, President Barack Obama has said. "You've got an unemployment rate that is still too high, an economy that's not growing fast enough," Obama said in an interview with CBS News recorded during his recent bus tour of three American states.— PTI

Reliance to close BP deal this month
New Delhi: Reliance Industries Ltd (RIL) is likely to close its $7.2 billion deal to sell stake sale in 21 oil and gas blocks to UK’s BP plc in the next 7-10 days. With the government formally communicating its approval for sale of 30 per cent stake in the 21 blocks, the closing documents are likely to be signed before month-end, sources said.— PTI

SEBI to review settlement procedure
New Delhi: Market regulator Sebi is mulling changes in the way it settles probes against listed companies and various market entities through a consent procedure -- an out-of-court-like settlement — as it has found the prevailing system to be lacking in uniformity.— PTI

CII for raising PEs, VCs investment limit
New Delhi: Private equity and venture capital funds should be allowed to invest 25 per cent of the capital of the target companies, up from the existing limit of 15 per cent, without having to resort to an open offer, industry chamber CII said in a report.— PTI

Maruti Suzuki plans global car by 2017
New Delhi: As its strengthens the R&D activities, the country's largest carmaker Maruti Suzuki India is aiming higher with plans to roll out a global car by 2017. "Our ultimate aim is to develop a car for the global market. With our new R&D centre at Rohtak getting ready, we will start working on a global car," Maruti Suzuki India (MSI) Managing Executive Officer (R&D) I V Rao said.— PTI

India to launch global portal for SMEs
New Delhi: To attract foreign players in the SME segment, the government will this year launch a portal providing information about small and medium companies, which contribute 45 per cent to the country's manufacturing output. "We will be able to launch a world-class portal by November this year," Micro, Small and Medium Enterprises (MSME) Secretary Uday Kumar Varma said.He said that through this portal, Indian SMEs could gain access to about 2.5 lakh potential customers across the globe.— PTI