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BUDGET 2012
Thomas Cook plans to sell 77% stake in India unit
Bahrain’s Batelco exits S Tel after 2G scandal
Direct tax collections up 9.3%, to miss FY12 budget target
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IT, ITeS cos set to cross $100 bn in revenues, fear slowdown next fiscal
SEBI seeks tough action against collective investment schemes
Bharti Airtel Q3 net dips 22% to Rs 1,011 cr
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Industry opposes tax on commodity transactions
Sanjeev Sharma/TNS
New Delhi, February 8 There is speculation that the government is planning to cut securities transaction tax (STT) to boost the stock markets and extend its scope to other asset trading classes such as commodities. There is a view that this may be in the offing to mop up revenues and also to check speculation in the commodity markets. Stock markets are seeking a STT cut which they claim is high and required to boost retail sentiment. According to the Federation of Indian Chambers of Commerce & Industry (FICCI), commodity derivatives reflect a global underlying asset and there should be parity between the cost of transaction on the Indian and global exchanges. It said imposition of CTT would escalate the cost of transactions on Indian exchanges resulting in a volume shift to international exchanges and grey markets. The government had introduced a commodities transaction tax in 2009 but later abolished the levy. Industry experts argue that both equities and commodities as asset classes cannot be treated in a similar manner as they are different. Stock derivatives are based on local assets whereas commodity derivatives are based on global assets such as gold, soya, cotton and others. If an investor trades in an Indian stock, the trade has to be done on an Indian exchange but a trader in gold futures can trade anywhere depending on the cost of the transaction. The Associated Chambers of Commerce & Industry of Indiab (Assocham) has represented that there should not be commodities transaction tax or any such transaction tax on equity derivatives and that they be treated in the same was as other hedging instruments such as interest rate and currency derivatives. FICCI has also pointed out that a high recurring cost in the form of commodities transaction tax would also discourage farmers participation in the commodity markets, which are considered a better risk mitigation instrument.
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Thomas Cook plans to sell 77% stake in India unit
London, February 8 The British firm, which secured a rescue package from lenders last November, said it continued to be adversely impacted by economic uncertainty across Europe and political upheaval in the Middle East and North Africa and expects 2012 to be challenging. But the world's oldest travel company said it had been encouraged by trading in its home market. "I’ve been encouraged by how our bookings have developed, particularly in the UK where our market share for both the winter and summer seasons remains broadly stable," acting chief executive Sam Weihagen said in a statement. Shares in the company were up 5.8 percent at 13.75 pence by 0948 GMT, when shares in TUI Travel were up 0.4 percent at 6.43 euros. TUI Travel, which owns Thomson and First Choice, had said on Tuesday it significantly outperformed rivals in Britain during January, highlighting the uncertainty surrounding Thomas Cook. On a conference call with reporters, Thomas Cook's Weihagen challenged that assertion, noting that TUI Travel was referring specifically to January, in which he said Thomson and First Choice had ramped up promotional activity. Weihagen said for summer 2012 as a whole, Thomas Cook had sold 42% of its holidays compared with TUI's 35%. "With statistics you can prove almost anything. January, yes, they took share. Before that, in December we took share," he said. "Had we taken December we’d have been hugely ahead of TUI because they were not doing much activity in the market place. They did a lot of activities in January when we were managing more for margin," he added. INDIAN SALE: Europe's second biggest travel firm by sales also said it planned to sell its 77 percent stake in Thomas Cook India as it looks to bring down its debt of 890 million pounds. Shares in Thomas Cook India rose by 20% to INR 53.85 in Mumbai following the news, valuing Thomas Cook's stake at around $180 million. — Reuters |
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Bahrain’s Batelco exits S Tel after 2G scandal
Dubai, February 8 Batelco will sell the stake to India partner Sky City Foundation Ltd and will receive the same price it paid to acquire its holding in S Tel in 2009, the Bahraini operator said on Wednesday. On February 2, the Supreme Court of India scrapped 122 licences held by eight operators amid a 2G telecoms scandal. Batelco said the deal would be completed by the fourth quarter. S Tel was not immediately available for comment. "This is a part of an earlier understanding with its Indian Partner to exit, given the circumstances surrounding the 2G probe in India over the past twelve months," Batelco said in a statement. The now revoked licences were awarded in 2008, before Batelco bought into S Tel. S Tel had 3.6 million customers as of December and ranks 12th out of 15 players by subscriber base. It has licences for six of India's 22 zones. India's older mobile carriers such as Bharti and Vodafone's local unit are seen as major beneficiaries of the court ruling last week to revoke licences given to newer companies. The court ruling is likely to accelerate the winnowing of an industry that has long been seen as ripe for consolidation. United Arab Emirates operator Etisalat owns a 45% stake in India affiliate Etisalat DB which also lost its licence last week. Etisalat has said it would study the court judgement, but declined to say on whether it would now seek to exit the country. — Reuters |
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Direct tax collections up 9.3%, to miss FY12 budget target
New Delhi, February 8 The government, however, may miss the full year direct tax collection target of Rs 5.32 lakh crore which envisaged a growth of 19 per cent over the last year. The net direct tax collection was Rs 3.17 lakh crore in the 10 month period of the 2010-11 fiscal. The slow growth in direct tax collection comes on the back of declining GDP growth rate which is estimated at 6.9% in 2011-12, down from 8.4% a year ago. The gross direct tax collections during the April-January period, however, was up by 14.57% at Rs 4.25 lakh crore. It was Rs 3.71 lakh crore in the corresponding period a year ago. Amid slowdown in industrial activities due to global factors and high domestic interest rates, revenue collections have come under pressure. According to the official data, gross corporate tax collection was up 12% at Rs 2.85 lakh crore in April-January from Rs 2.55 lakh crore in same period in the previous fiscal. The personal income tax collection in the 10 month period of the current fiscal was up by 20.43% at Rs 1.38 lakh crore. — PTI |
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TCS, Mitsubishi to to form $5 m JV
Bangalore, February 8 The company's annual revenue from Japan is about $100 million, he said. TCS will hold 60% stake in this joint venture entity whereas 40% will be held by the Japanese company Mitsubishi Corp. The JV is important for TCS as the company derives only 1% of its revenues from the Japanese markets and 7% from the Asia Pacific region. This is a good chance in which TCS can leverage a partner like Mitsubishi and get an entry into world's third largest economy and provide software services there. — Agencies |
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IT, ITeS cos set to cross $100 bn in revenues, fear slowdown next fiscal
New Delhi, February 8 Nasscom also said hiring is expected to be lesser at 100,000 jobs in the next fiscal and the growth in wage hike will also be lesser at around 8-10%. "This has been a very good year for the industry and we have seen a growth of 16.3 per cent. This year (fiscal) the industry will cross the US $100 billion mark," Nasscom chairman Rajendra S Pawar said. According to estimates by the industry body, total revenue of the sector will be $101 billion out of which $69 billion will be from exports and $32 billion from domestic market. Stating that the current environment has become uncertain due to a variety of factors such as the elections in the US, the eurozone crisis and India's own "policy paralysis" among others, Pawar said for the fiscal 2012-13, the industry is expected to grow between 11-14%. "We’ll revisit this forecast in October. The mood is more sombre now and these uncertainties are forcing us not too look at the whole year," Pawar said. The industry can meet the vision 2020 target of touching $225 billion povided it grows at a compounded annual growth rate of 13% from fiscal 2012-13, he added. Commenting on the hiring prospects in the industry, Nasscom president Som Mittal said: "There’s a strong hiring pipeline of over 100,000 offers." This will, however, be less than around 120,000 jobs projected to be witnessed in the ongoing fiscal. On the salary hike front, Nasscom said the growth could be in the range of 8-10% in 2012-13 as compared to 10-14% in the current fiscal. Calling for government support, as is being done by competitor countries like China, Brazil, Philippines, South Africa and Egypt among others, Mittal said India's policy should chart out a clear roadmap for the industry. "There’s a policy paralysis in India. There’s no roadmap on DTC, GST and SEZ issues. Also there’s increased tax activism and sometimes we feel we’re soft targets," Mittal said citing examples of issues like “body shopping” (transfer pricing under which IT firms are made to pay more taxes). — PTI
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SEBI seeks tough action against collective investment schemes
Mumbai, February 8 SEBI will also give the names of the directors of such entities to the ministry, so that necessary actions can be taken to prevent these companies and persons from being associated with any new company, a senior official said. The collective investment schemes, where an entity pools in money from investors for certain prespecified purposes and later distributes the profits or income, come under SEBI’s ambit. There are estimated to be over 500 entities in India which have undertaken CIS activities without complying with SEBI norms and the regulator has initiated necessary action against many of them in the past. Many of these entities and their operators/directors tend to restart similar business under a new name and numerous investors are taken for a ride before they come under the SEBI scanner, the official noted. SEBI has now decided to request the MCA to circulate the names of defaulter CIS entities and their directors among all the ROCs (registrars of companies) in the country to prevent them from being associated with any new company, he added. SEBI is also of the view that a complete overhaul of the current CIS regulations was needed, as loopholes in the existing rules allow for the gullible investors being taken for a ride, the official said. The capital market regulator will take up the issue of these regulatory gaps at the meeting of the Financial Stability and Development Council (FSDC), which is chaired by the finance minister and includes top financial sector regulators such as the RBI governor and the SEBI chairman. While hundreds of the companies have engaged in the CIS activities in the country, just one such entity is registered with SEBI to undertake such kind of business. Generally, the operators of such schemes offer impressive returns in their initial days to lure unsuspecting investors and then suddenly disappear after some time, leaving their investors in a lurch. Some of the most common CISs are related to investments for real estate properties, plantation and agriculture industry, art funds, time-sharing schemes and multilevel marketing schemes, among others. According to SEBI data, over 100,000 investor complaints are currently pending with it in connection with such schemes, and the matter is sub judice since long in most of the cases. While SEBI is the regulatory authority for such schemes, a number of other government agencies and departments also govern similar investment products and a lack of clarity in this regard comes in the way of bringing the guilty to book. — PTI |
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QTLY Results
New Delhi/Mumbai, Feb 8 The company had posted a consolidated net profit of Rs 1,303 crore in the third quarter ended Dec 31, 2010, Bharti Airtel said. At 11:19, shares of Bharti Airtel fell by 5.33 per cent to Rs 359 on the Bombay Stock Exchange. Bharti Airtel said the roll-out of its 3G network resulted in a higher amortisation cost of Rs 164 crore for the quarter, while its net interest cost rose to Rs 116 crore during the reporting period, the company said. The company's total reveunes rose to Rs 18,477 crore in the October-December quarter from Rs 15,772 crore in the year-ago period, registering a growth of 17%. ONGC Q3 net falls 5%
State-owned explorer Oil & Natural Gas Corp (ONGC) today reported a 5% drop in its net profit in the quarter ended December 31 as a sharp rise in fuel subsidy output offset one-time gains it made from Cairn India's Rajasthan oilfields. ONGC reported a net profit of Rs 6,741.41 crore in the October-December quarter as opposed to Rs 7,083.23 crore a year ago, the company said in filing to the stock exchanges. The state-owned firm said the royalty it pays not just on its 30% stake but also 70% interest of Cairn India on crude oil produced from prolofic Rajasthan block is now being treated as cost recoverable. ONGC said its board of directors has declared an interim dividend of Rs 6.25 per share (125%) amounting to Rs 5,347.18 crore. Tech Mahindra net rises
Tech Mahindra, India's fifth largest software services company, posted a better-than-expected 7.4% rise in quarterly net profit. Net profit rose to Rs 2.76 billion ($56 million) for the three months ended Dec 31 from 2.57 billion rupees in the year earlier period. Analysts, on average, has expected a net profit of Rs 2 billion, according to Thomson Reuters I/B/E/S. Cognizant Q4 profit up
IT services provider Cognizant Technology Solutions Corp's quarterly profits jumped 18% helped by growth across sectors. For the fourth quarter, the company earned $240.1 million, or 78 cents a share, compared with $206.2 million, or 66 cents a share, a year ago. Excluding items, it earned 84 cents a share. Revenue rose 27% to $1.66 billion. Shares of the Teaneck, New Jersey-based company closed at $72.01 on Tuesday on the Nasdaq. GMR Infra loss widens
GMR Infrastructure Ltd's net sales rose a stronger-than-expected 47% in the December quarter even as losses mounted after it was ordered by a court to suspend collection of airport development fees at Delhi airport, which it operates. The company, which was also hit by a higher interest bill, reported a consolidated net loss of Rs 1.08 billion for the three months to Dec 31, compared with a loss of Rs 222.5 million a year earlier. — Agencies |
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