The Tribune, Chandigarh, India

IT companies set to ride high on weak rupee
Girja Shankar Kaura/TNS

New Delhi, October 17
The spectacular second quarter results posted by software major Infosys Technologies last week is an indicator of what can be expected out from the other information technology companies due to declare their results over the week.

The sharp depreciation in the Indian rupee of 11 percent against the US dollar between the first and second quarters has not only given Infosys a bonanza but is expected to do the same for the other IT majors, all whom depend strongly on their business from America and Europe.

The country's showpiece $76 billion industry gets more than 90 per cent of its revenues from providing technology services to overseas clients, mainly in the United States and Europe.

Infosys last week reported a 9.72 per cent growth in its consolidated net profit to Rs 1,906 crore for Q2 ended September 30.

Market analysts point out that the other IT companies including NIIT and HCL Technologies, both of which are to declare Q2 results on Tuesday, would also be declaring higher than expected revenues mainly as a result of a weaker rupee. They noted while fresh orders may slow down due to the slowing of the US economy and a debt crisis in Europe, a weak rupee will boost the margins of all the players in the market.

The analysts say a weak rupee would be good for the exporters but the main indicator about the prevailing situation in the industry would come from spend budgets that companies in the US and Europe keep for the next year.

According to experts, if the rupee stays at the same levels as now it would also be beneficial for these companies in the third quarter as well. But they point out this may not happen as such trends remain mainly for two to three months and then correction occurs. The volatility in the markets may be very high but the strengthening dollar reflects another story, they add.

Industry watchers are of the view that a stable rupee would be more beneficial for the IT industry as that would allow them to factor in many things before planning for the future. Most companies set their annual budget for next year by November. A volatile rupee would not allow a steady view for these companies. Addition of new clients would be the main indicator of growth for these firms.

Experts point out that despite the prevailing high volatility the overall outlook for the IT industry remains stable over the next year and a steady growth is expected.

TCS Q2 net up 14.7%, below estimates

New Delhi, October 17
Tata Consultancy Services (TCS), India's largest software services exporter, reported a 14.7 per cent rise in quarterly net profit, marginally below estimates as uncertainty in the global economy weighed on new outsourcing orders.

TCS, a unit of the salt-to-steel conglomerate Tata Group, said Monday net profit for the fiscal second quarter that ended September rose to Rs 2,439 crore ($498 million) in accordance with international financial reporting standards.

Q2 sales was at Rs 11630 crore versus Rs 9290 crore, up 25% YoY. Q2 operating margins were at 27.1% versus 28.1% whereas Q2 net profit margin was at 21% versus 22.9% YoY.

TCS managing director N Chandrasekaran said: "The company said that it had strong deal pipeline across all major verticals. Macro concerns remain but corporations in good shape."

TCS added 35 new clients in the September quarter and said that there was major growth in the US, UK and Europe. The company had a gross addition of 20,349 employees and overall attriton was down to 13.7%; IT services attrition was at 12.5%.

The company's major clients include Citigroup, General Electric, British Airways, Sony Corp and British insurer Aviva.

Infosys, India's No.2 software services exporter, last week reported a 9.7-percent rise in second-quarter profit, roughly in line with street estimates, easing investor worries of a sharp slowdown in the outsourcing sector.

Shares in TCS, valued at about $45 billion fell by over 1 per cent on bourses as investors booked profits. The company's stock, which fell 2 per cent intra-day, closed 1.30 per cent lower at Rs 1,119.80 a piece on the BSE.

India's IT services companies such as TCS, Infosys and Wipro earn about 85 per cent of their revenues from the US and European markets. — Agencies

India’s economy slowing: Moody’s

New Delhi, October 17
India's slowing economic growth is a "cause for worry", research group Moody's Analytics said Monday, highlighting the failure of aggressive interest rate hikes to curb near double-digit inflation.

India's growth has weakened under the brunt of 12 interest rate increases since March 2010 that have pushed up borrowing costs for everything from consumer appliances to plant equipment.

India's growth would slow from an expected 7.8 percent year-on-year in the first half of 2011 to 6.5 percent by mid-2012, said Glenn Levine, senior economist at Moody's Analytics.

That still implied a "soft landing" -- a rate of growth high enough to avoid recession -- Levine said in a research note, while warning that this outcome was "by no means assured".

Although the economy of neighbouring emerging market China was also slowing, it was happening "at an entirely manageable rate", Levine said. "India presents a more serious cause for worry" as its economy "is slowing sharply," he said. — AFP

Global air travel set to shrink further as confidence wanes
Vibha Sharma/TNS

New Delhi, October 17
The widespread decline in international trade and business confidence across the world is likely to result in a slowdown in air travel in the coming months across the board, including India and China, particularly in the premium business category.

The major source of "weakness" in air travel has been tracked by the International Air Transport Association to Europe, where "economic conditions and business confidence have deteriorated sharply". In its assessment of premium and economy travel in August, IATA says the month saw a sharp fall in the number of passengers travelling on premium seats after an unexpectedly robust growth in the second quarter.

The level of premium travel was just 2.3 per cent up on the previous year in August, compared with 7.5 per cent in July. The category in fact fell back to the levels of the fourth quarter of last year, consistent with the decline in international trade and business confidence seen in recent months, says IATA. It added the fall in business confidence has been widespread, including India and China, and there will be a further slowdown in air travel in the months to come.

The saving grace for the industry, fighting with soaring fuel costs and other factors, is that the economy travel was not as severely affected, declining from a growth of 5.5% to 3.7%, reflecting some business passengers probably switched their class in order to travel cheaper. Incidentally, the Europe and North Atlantic markets saw the sharpest falls in premium traffic in the month while by contrast some premium markets, such as within the Far East, remained strong as structural gains in regional trade boosted business travel.

BlackBerry offers free apps to appease users
Tribune News Service

New Delhi, October 17
In a gesture of appreciation to its over 70 million customers worldwide, including over a million in India, who displayed "patience" to remain with BlackBerry despite facing business and personal life disruptions, its Canadian maker, Research in Motion on Monday said it would offer customers applications worth over $100 for free.

In a statement issued here RIM said: "A selection of premium apps worth a total value of more than $100 will be offered free of charge to subscribers and will be made available to customers over a period of four weeks beginning October 19 on BlackBerry App World and will continue to be available until December 31."

BlackBerry will offer 12 mobile applications, including Vlingo that combines voice-to-text and voice recognition technology; Gameloft; and iSpeech, a free text-to-speech and speech recognition software.

Last week BlackBerry's email, messenger and other online services were disrupted for almost four days on account of a core switch failure in London. It services collapsed in four continents including Asia, Europe, Africa, America and the Middle East last Monday.

Although RIM claimed early Tuesday it had fixed the problem and services had been restored, within a few hours the services collapsed again putting its users in a spot.

"We truly appreciate and value our relationship with our customers. We've worked hard to earn their trust over the past 12 years and we're committed to providing the high standard of reliability they expect, today and in the future," RIM co CEO Mike Lazaridis said. "We're grateful to our loyal BlackBerry customers for their patience. We've apologized to our customers and will work tirelessly to restore their confidence. We are taking immediate and aggressive steps to help prevent something like this from happening again," he added.

RIM's Enterprise customers will also be offered one month free technical support.

MTS first CDMA operator to launch global roaming
Girja Shankar Kaura/TNS

New Delhi, October 17
Telecom operator Sistema Shyam TeleServices Ltd (SSTL), which operates its telecom services under the MTS brand, on Monday became the first CDMA-based operator in India to launch international roaming for its subscribers.

The service, although launched initially for its prepaid customers, would allow the majority of its over 13 million wireless customers to roam across seamlessly over 433 GSM networks in 231 countries. Earlier CDMA subscribers had to shut off their cellphones while abroad as the telecom service was not compatible with the networks available there.

The firm also announced the launched of a dual mode SIM card which would work both on GSM handsets while overseas and on OMH CDMA handsets while in India.

MTS has become the first telecom operator in the country to provide international data roaming for CDMA prepaid customers. It has launched the service with the solution provided by service provider MACH.

MTS customers on international roaming would have access to GPRS services in 206 countries on 322 telecom networks. Additionally, MTS customers will be able to enjoy HSDPA services in 114 countries on 145 roaming networks.

Leonid Musatov, MTS India chief marketing & sales officer, said: "We at MTS are always looking at innovation in our products and services to enhance customer experience. With a view to enhance connectivity and convenience, we have now introduced international roaming services for our customers. This would enable our customers to stay connected while traveling abroad without changing their phone numbers and also enjoy seamless data connectivity on the go internationally".

Raghunatha Chary, regional VP (sales-India), MACH, said: "We are delighted MTS India selected our market leading Inter-Standard Roaming solution to be the first in India to provide its prepaid customers with seamless access to international roaming on GSM networks across the world. Our solution enables MTS India to deliver a full portfolio of voice services and applications to its customers, through one device, one number and with one bill, so enhancing customer satisfaction and increasing mobile usage".

Reliance halts future oil, gas drilling

Mumbai, October 17
Energy giant Reliance Industries is to suspend drilling for future oil and gas exploration pending a reassessment with its new venture partner BP, a company source said on Monday. The source said India's largest private oil explorer is "reevaluating" its exploration and production strategy in partnership with the British company.

"With BP as our strategic partner it makes sense to do a fresh review of our portfolio and come back with a new strategy," the source added, without specifying a timeframe for when new drilling would restart.

Reliance recently concluded a $7.2 billion deal with BP, selling it a 30 percent stake in 21 of its oil and gas fields off the Indian coast. — AFP

Airtel tieup with Nokia Siemens
Tribune News Service

New Delhi, October 17
The country’s largest telecom operator Bharti Airtel has joined hands with Nokia Siemens Networks' software to offer seamless internet connectivity and more intuitive mobile data services across the 16 nations in African where it has its operations.

In a statement issued here Bharti said, Bharti Airtel has selected Nokia Siemens Networks' Serve at Once Device Management (SADM) software for implementation across its operations in 16 African countries.

Samsung India

Chandigarh: Electronics major Samsung India expects to notch a sales turnover of Rs 2,500 crore, with the northern region accounting for Rs 650 crore, during the ongoing festival season . — TNS

Maruti deadlock continues as talks fail, production resumes
Sunit Dhawan/TNS

Manesar/Gurgaon, October 17
The tripartite talks among representatives of Maruti Suzuki India Ltd's management, agitating workers of the company and the Haryana government held here on Monday failed to break the stalemate even as the auto major's Gurgaon plant resumed functioning and limited operations commenced at its Manesar plant.

"Our objective was to bring the Maruti Suzuki management and striking workers to the discussion table and look for a possible solution," said a government official present at the meeting.

A half-hearted approach was evident at the very outset of the meeting, which was not attended by senior functionaries of the government or the company management.

Protesting workers representing the Maruti Suzuki Employees Union also left the meeting early to take part in a rally. A large number of industrial workers from Maruti Suzuki and other Suzuki concerns, other industrial units and various labour organizations showed their strength at the rally organized in support of the workers at the company's Manesar plants. The protesters threatened to intensify their stir in case their demands were not met.

Meanwhile, the company's management said as many as 1,700 vehicles had been manufactured at its Gurgaon plant on Monday. The Gurgaon facilities were closed on Friday and Saturday on account of the strike at Suzuki Powertrain India Ltd, the supplier for diesel engines and transmissions.

The firm was informed by the Suzuki Powertrain management that partial operations had been resumed at the latter's Manesar plant.

‘Labour ministry willing to intercede’

Labour Minister Malikarjun Kharge said his ministry was willing to intercede to resolve the industrial dispute at the Maruti Suzuki plant in Manesar, provided the request came from the Haryana government. He was replying to reporters’ questions while addressing the 44th session of the labour standing committee in New Delhi on Monday. He also stated the UPA government was looking seriously at the complaints of contract workers raised by trade unions of being denied any protection provided to regular workmen. — TNS

BMW to launch small car Mini in India next year

Gurgaon, October 17
German auto major BMW today said it would launch the small luxury car, Mini, in India by next year at a price that is expected to be above Rs 25 lakh.

The company also said it would set up separate showrooms for the brand and aimed to have up to 12 dealerships across the country for the Mini in the coming years.

"I’m pleased to announce that the Mini will be introduced in India in 2012. Currently, the BMW team is evaluating which version to be launched in India from the entire Mini family," BMW India president Andreas Schaaf said.

He said the Mini would be sold in India through import of completely built units (CBUs). BMW had earlier planned to launch the Mini in India in 2009, but shelved it citing feasibility reasons. — PTI

Trade with S Africa set to get a boost
Sanjeev Sharma/TNS

Pretoria, October 17
Prime Minister Manmohan Singh reached here to attend the IBSA summit. Commercial and economic relations between India and South Africa will get a boost as both countries have set a target of $15 billion in trade by 2014.

There is substantial potential for trade growth between the two countries. Exports from India to South Africa include vehicles and components, pharma, chemicals. Imports include gold copper, manganese and other minerals.

The major investors include Tata in auto, IT, hotels, UB group in breweries and hotels, M&M and a number of pharma companies including Ranbaxy, Cipla as well as IT companies and some investments in the mining sector.

There is also growing South African investments in India led by SAB Miller, ACSA, Sanlam, Old Mutual.

An important initiative under negotiation is the India-SACU preferential trade agreement. Commercial interaction has been aided by an India-south Africa CEOs forum. The forum was relaunched in June last year during the visit of the South African president. Ratan Tata on the Indian side and Patrice Motsepe on the South African side chair the forum.

India and South Africa have a common approach on many global issues, including UNSC reform, the future of multilateralism, climate change, South-South Cooperation and multilateral trade negotiations. This has led to fruitful cooperation in the UN, NAM, the Commonwealth, IAEA, IOR-ARC, WTO, G77, G20 and the New Asian-African Strategic Partnership (NAASP).

South Africa lent strong proactive support to the proposal to enable full civil nuclear cooperation with India at the IAEA and the NSG meetings which enabled India to get the historic waiver from the NSG.

Recently, South Africa attended its first meeting as a member of BRICS summit held in China in April, 2011.

PM in Pretoria for IBSA summit
Sanjeev Sharma/TNS

Pretoria, October 17
The India-Brazil-South Africa (IBSA) summit to be held tomorrow is likely to come up with a joint declaration on issues concerning the global financial situation, UN Security Council and climate change.

PM Manmohan Singh arrived today in Pretoria for the summit, which brings together three large countries of three continents.

M Ganpathy, Secretary (West), External Affairs Ministry, told reporters here that the focal point meetings dealing with several issues in preparation of the summit were held today.

He said the issue of international terrorism besides the situation in Somalia was touched upon in the meetings.

He said meetings of the 16 working groups under IBSA on different subjects have been completed. The summit comes in the backdrop of the global financial crisis and the three leaders are expected to coordinate on this issue which will also find resonance in the G20 meeting next month in Cannes.

Commercial and economic relations between India and South Africa will get a boost as both countries have set a target of $15 billion in trade by 2014.

There is also growing South African investments in India led by SAB Miller, ACSA, Sanlam, Old Mutual.