New Delhi, January 8
The government has stuck to the policy of allowing 100% foreign investment in the existing pharma companies, brushing aside concerns about the non-availability of affordable drugs in view of takeovers by MNCs.

The Department of Industrial Policy and Promotion (DIPP) said however that as far as the contentious issue of non-compete clause is concerned, the Foreign Investment Promotion Board (FIPB) will take a view on it on case-by-case basis.

"The government has reviewed the position in this regard and decided that the existing policy would continue with the condition that 'non-compete' clause would not be allowed except in special circumstances with the approval of the FIPB," the DIPP said.

Faced with a rush of MNCs buying Indian firms, the DIPP had earlier proposed stringent norms to tighten the FDI policy for the sector.

It had said the continuous acquisition of Indian pharma companies will severely impact availability and affordability of generic medicines in the country, and asked for a reduction in the FDI cap to 49% from 100% in rare or critical pharma verticals. However, the Union Cabinet at its meeting dismissed the DIPP concerns.

DIPP had said over 96% of the total FDI in the sector between April 2012 and April 2013 has come into the brownfield pharma, or existing projects and companies.

The DIPP has also made public a discussion paper giving pros and cons of permitting FDI in the e-commerce retail sector.

Listing advantages and disadvantages, the discussion paper has said that FDI in e-commerce on one hand will boost infrastructure development and spur manufacturing facility but it could also lead to large scale job losses.

It would provide "more responsive order taking and after-sales service to customers and competitive pricing, increased access to buyers/sellers, allow MSMEs and artisans to reach out to customers far beyond their immediate location, both locally within India and abroad", the paper has said.

However, it would be against the spirit of FDI policy in multi-brand retail trading (MBRT). The government has last year permitted 51% FDI in MBRT.

It also said as small time ‘kirana’ stores remain the largest source of employment in the country, "opening of B2C e-commerce on inventory based model is likely to impact these shopkeepers leading to large scale unemployment".

New Delhi, January 8
Worldwide combined shipments of devices (PCs, tablets and mobile phones) are projected to reach 2.5 billion units in 2014, a 7.6% increase from 2013.

As per projections brought out by research firm Gartner, among the operating system (OS) market, Android is on pace to surpass 1 billion users across all devices in 2014. By 2017, over 75% of Android's volumes will come from emerging markets.

"The device market continues to evolve, with buyers deciding which combination of devices is required to meet their wants and needs. Mobile phones are a must have and will continue to grow but at a slower pace, with opportunities moving away from the top-end premium devices to mid-end basic products," said Ranjit Atwal, research director at Gartner.

"Meanwhile users continue to move away from the traditional PC (notebooks and desk-based) as it becomes more of a shared content creation tool, while the greater flexibility of tablets, hybrids and lighter notebooks address users' increasingly different demands.”

Mobile phones are expected to dominate overall device shipments, with 1.9 billion mobile phones shipped in 2014, a 5% increase from 2013. Ultra-mobiles, which include tablets, hybrids and clamshells, will take over as the main driver of growth in the devices market from 2014, with a growth rate of 54%.

"Complimentary smaller tablets will take over from the larger tablet form factors, providing the added mobility that consumers desire at a lower cost and will compete with hybrids for consumer attention," said Atwal.

In 2014, the worldwide tablet market is forecast to grow 47% with lower average selling prices attracting new users. According to a recent consumer study that Gartner conducted in the third quarter of 2013 across Brazil, China, France, Germany, Italy, the UK, the US and Japan, over two-thirds of tablets were used outside the home for activities such as vacation or concert. This is a similar pattern to that of smartphones as smaller form factors are driving more portability outside the home.

New Delhi, January 8
The theme for the third quarter (Q3) earnings of 2014 for corporate India is likely to repeat the trend of the last quarter where global facing companies are doing better than the domestically focused ones due to rupee depreciation.

Analysts say sectors which export will do better than the ones that focus on the domestic economy. According to a research note on the Q3 results preview by Motilal Oswal Securities, the theme will be similar to the second quarter, “Globals do, locals undo”. As in Q2, it expects global-facing sectors like technology, healthcare and metals to outperform their domestic-facing counterparts thanks to 15% year-on-year depreciation of the rupee versus the dollar.

Crisil says from this quarter several sectors are expected to register a gradual improvement in growth rates. The rise in revenues, though, would not translate to higher profitability.

It says in the previous quarter the growth in revenues was largely on account of export-oriented sectors benefiting from a weak rupee.

From the current quarter onwards, a gradual recovery is expected in more sectors. “Apart from IT, pharmaceuticals and textiles, domestic consumption-linked sectors will see moderate improvement, as rural demand picks up owing to a better monsoon. Also, while growth in investment-linked sectors will remain weak, unlike in the past many quarters, it is not expected to deteriorate further”, it adds.

In Q3 FY14, Crisil Research expects one-third of the 50 sectors (encompassing 605 companies) covered in the analysis, including IT services, pharmaceuticals, tractors, textiles, FMCG, retail and media, to clock double-digit growth.

“Higher rural income, owing to good monsoon, will benefit two-wheeler and tractor manufacturers, which, in turn, will support the auto components sector. Volume growth in the FMCG sector is expected to sustain. Also, steel companies will register higher growth, led by import substitution and rise in exports due to rupee depreciation. Infrastructure-linked sectors such as construction, roads and cement have bottomed out as well”, the Crisil report adds.

Kotak Securities says among sectors, IT and auto are expected to predominantly propel growth driven by the near 14% rupee depreciation. Within auto, Tata Motors is expected to report high growth on the back of JLR. On the other hand, capital goods and metals are expected to be a drag largely due to lower investment activity in infrastructure and weak demand.

New Delhi, January 8
ONGC Videsh Ltd (OVL) and Oil India Ltd (OIL) have completed the acquisition of Videocon Group’s 10% stake in a giant Mozambique gas field for $2.475 billion, the companies said today.

OVL, the overseas arm of ONGC, and OIL agreed in June last year to jointly buy Videocon’s 10% interest in the Rovuma Area 1 for $2.475 billion.

Additionally, OVL bought US energy major Anadarko Petroleum's 10% stake in the same block for $2.64 billion.

Payments to Videocon to close the deal were made yesterday, the companies said in separate statements. OVL will pay Anadarko before February-end. — PTI

BRIEFLY

Welspun to set up solar power project in Punjab
New Delhi: Welspun Energy will invest Rs 1,350 crore in the next three years to set up 150 MW solar power project in Punjab, for which the company has signed the initial agreement with the state government. The project is slated to begin commercial operations by 2017. — PTI

Coal India to decide on interim dividend on Jan 14
New Delhi: Amid the demand for a special dividend if disinvestment in Coal India fails, the company has scheduled a board meeting next week to consider payment of an interim dividend. "A meeting of the board of directors will be held on January 14...to consider payment of interim dividend, if any, for the year 2013-14," Coal India said. — PTI

OilMin opposes IOC stake sale at current mkt price
New Delhi: The Oil Ministry on Wednesday opposed stake sale in Indian Oil Corp at current prices. At Wednesday's closing price of Rs 195.50, IOC has a market capitalisation of Rs 47,466 crore. This m-cap is after factoring in IOC's 7.69% holding in ONGC. — PTI

Moily, Tata conferred with life time achievement award
Mumbai: Oil Minister M Veerappa Moily and Ratan Tata, chairman emeritus of one of India's largest conglomerates, were on Wednesday awarded Life Time Achievement Awards. Tata was conferred with the Life Time Achievement in Corporate Governance. — PTI