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Annual Monetary Policy
India Inc cheers
Maruti net zooms 31.4 pc
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Steps to contain inflation, maintain growth: FM
Vedanta to buy 71 pc of Sesa Goa
Service tax waiver has PM’s nod
Emami plans biofuel unit
Bank Account
Pepsico’s expansion plans for Punjab
Shareholders approve merger of RIL-IPCL
Private sector workers to get Shram awards
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Annual Monetary Policy
Mumbai, April 24 Announcing the policy here, RBI Governor Y.V. Reddy said the RBI has kept the bank rate unchanged at 6 per cent, the reverse repo rate at 6 per cent, repo rate at 7.75 per cent and the cash reserve ratio (CRR) at 6.5 per cent. The RBI has now permitted Indian banks to extend credit and non-credit facilities to step-down subsidiaries within the existing prudential limits and some additional safeguards. Banks and primary dealers have also been permitted to begin transactions in single-entity credit default swaps. The RBI also introduced measures to make interest rates attractive for housing loans upto Rs 20 lakh. Reddy announced today that risk weight on the residential housing loans to individuals would be reduced to 50 per cent from 75 per cent as a temporary measure, keeping in view the default experience and other relevant factors. This step would be applicable to loans up to Rs 20 lakh and will be reviewed after one year, the policy said. This measure will leave banks with more money to lend for the housing sector and make interest rates attractive for loans up to Rs 20 lakh. Meanwhile the apex bank has lowered its growth forecast to 8.5 per cent from 8.5-9 per cent as it expects global GDP to decline in 2007. Inflation targets have also been revised downward to 5 per cent from last year's targets of 5-5.5 per cent. The RBI hopes to rein in inflation between 4 and 4.5 per cent over the medium term. With foreign exchange inflows peaking $200 billion, the RBI has begun to move a bit further towards full capital account convertibility. Among the measures in this direction include permission for Indian companies to invest in foreign companies upto 300 per cent of their net worth, hedging for individuals and outward remittances up to $ 100,000 as against $50,000 in the past. Domestic producers and users will also be allowed to hedge their price risk on international commodity exchanges for copper, aluminia, zinc, and even aviation turbine fuel. Indian companies will also be allowed to rebook and cancel their forward contracts. The RBI has also reduced interest rate ceilings on non-resident deposits. It proposed allowing corporates to repay more external commercial borrowings ahead of schedule, proposed increasing the aggregate ceiling for overseas investment by mutual funds to $4 billion from $3 billion, and increased the foreign portfolio investment limit for listed firms. Reddy also put out a roadmap for the apex bank to develop the corporate bond market, futures contract, establishment of credit information companies and a number of steps to help distressed farmers and micro-finance. Reddy announced that a credit guarantee scheme would be introduced for distressed farmers.
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India Inc cheers
New Delhi, April 24 However, the Federation of Indian Export Organisation has expressed its disappointment over lack of initiative to contain hardening of rupee. “The policy lays greater emphasis on price stability, aiming to contain inflation at 5 per cent in current fiscal,” ASSOCHAM president Venugopal N. Dhoot said. FICCI president Habil Khorakiwala said, “On the whole, the RBI has responded remarkably well in a live-wire fashion to the developments in the Indian economy”. PHDCCI president Sanjay Bhatia suggested that once the inflation was within manageable limits, the RBI should take measures to soften the interest rate structure in the country. Under the current circumstances, the RBI could not have announced a more appropriate policy, said CII president R Seshasayee. |
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Maruti net zooms 31.4 pc
New Delhi, April 24 MUL board of directors had approved the financial results which saw the profit before tax going up to Rs 2,279 crore in 2006-07, a growth of 30.3 per cent over the previous year. The board also recommended a dividend of 90 per cent which is a 20 per cent increase over the 2005-06 fiscal. The financial results pointed to a 24 per cent increase in its net profit at Rs 448.56 crore for the fourth quarter ended March 31, 2007 as compared to Rs. 360.92 crore for the corresponding period last year. The company’s total income also rose to Rs 4,634.74 crore in the said period in comparison to Rs. 3,392.27 crore for the quarter ended March 31, 2006. Its operating margins fell by 12.4 per cent in the January-March quarter from 14.8 per cent a year earlier. Sales of its vehicles rose 30 per cent to 2,00,112 units in the quarter. Maruti opened a new car plant in February with a capacity of up to 3,00,000 units and a diesel engine and transmission plant with similar capacity.
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Steps to contain inflation, maintain growth: FM
New Delhi, April 24 “We must moderate inflation without affecting growth. Both are important (moderate inflation and high growth). And I think what the RBI has done today is broadly in line with government’s thinking. These steps would moderate inflation without affecting growth,” Chidambaram said. On the RBI’s projection of slower growth of India’s economy at 8.5 per cent in 2007-08 against the expected 9.2 per cent for 2006-07, he said, “It was a cautious and conservative position”. “If manufacturing rises by double digit numbers like services, 8.5 per cent GDP growth would be floor and not the ceiling,” he added. “To keep inflation below 4.5 per cent is indeed an aggressive target. But that appears to be the tolerance level for inflation.” |
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Vedanta to buy 71 pc of Sesa Goa
Mumbai/London, April 24 London Stock Exchange-listed Vedanta has bagged a deal for buying 51 per cent stake in Sesa Goa Ltd from its Japanese parent Mitsui & Co Ltd for $981 million (around Rs 4,070 crore) in cash. It also plans to purchase an additional 20 per cent stake through an open offer to be launched soon. Vedanta said the deal would create India's largest diversified mining group, with “leading market positions in aluminium, copper, zinc and iron ore together with an industry leading pipeline of expansion projects”. “This acquisition provides us with an industry leadership position in the attractive iron ore business in India,” Vedanta Resources Chairman Anil Agarwal said in a statement. "Sesa Goa is a natural fit for Vedanta; it is an efficient, low-cost miner with growth opportunities in one of the world's fastest growing economies. This transaction is immediately earnings and cash-flow accretive and will create significant long-term value for our stakeholders," he added. This is the third metal sector deal focussed on iron ore capacities in less than a week after Indian conglomerate Essar Group’s announcement last week to acquire ore rich Minnessota Steel in the US and the British mining giant Anglo American’s proposed $1.5 billion acquisition of about half of a Brazilian iron-ore project. Vedanta said the open offer to the public shareholders of Sesa Goa to acquire further 20 per cent stake was expected to close by July 2007. While the total cash consideration for 71 per cent of Sesa Goa stake was $1.37 billion, the deal would be funded through a mix of newly committed bank debt facilities of $1.1 billion and existing cash resources, it said. Vedanta said it has acquired Mitsui's 100 per cent stake in Finsider International Ltd UK, which owns 51 per cent stake in Sesa Goa, at a price of Rs 2,036 per share of Sesa Goa. The 50-year old Sesa Goa, which has mining operations across iron ore-rich states like Goa, Karnataka and Orissa, was under Italian management before Mitsui acquired it in 1996. — PTI
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Service tax waiver has PM’s nod
New Delhi, April 24 "No Foreign Trade Policy can be announced without approval of the Prime Minister," a senior Commerce Ministry official said here. He said many rounds of discussions were held with the Finance Ministry on the proposal and Prime Minister's clearance was obtained two days before its announcement. Since Parliament is in session (though in recess), a copy of the policy was delivered at the Speaker's office before it was made public. The official was reacting to reports that Finance Ministry was "taken by surprise" by Commerce and Industry Minister Kamal Nath's April 19 announcement regarding waiver of service tax on exports. —
PTI |
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Haldia, April 24 Laying the foundation stone of the project here today, Chief Minister Buddhadeb Bhattacharya said the state government would soon frame a biodiesel policy to encourage such projects. He said the three districts identified for jathropa cultivation were Bankura, Purulia and West Midnapore. The bio-diesel project will be set up by Emami Biotech. Joint chairman of Emami group of companies R.S. Agarwal said initially Emami Biotech would import crude farm oil and other ingredients for production of biodiesel from Malaysia and Indonesia. "Efforts are being made to ensure availability of jathropa oil from the fourth year of plant operation," Agarwal said. — PTI
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Bank Account
Mumbai, April 24 Its net profit for the quarter ended March 07 was 3.44 billion rupees ($83 million), up from 2.63 billion reported a year earlier. Indian banks have been riding strong loans growth as companies expand but they have been facing pressure on margins. It is because borrowing costs rose faster than lending rates as the central bank tightened liquidity to contain inflation. Indian Overseas Bank Indian Overseas Bank (IOB) today announced a net profit of Rs 289.76 crore for the fourth quarter ended March 31. The total income stood at Rs 1,935.84 crore for the three months ended March 31, 2007, where as the same was at Rs 1,336.94 crore for the same period in 2006, the IOB informed the BSE. Meanwhile, the board of directors at a meeting held today, recommended a dividend of 30 per cent. The IOB added that figures for the current quarter and current year include the operations of erstwhile Bharat Overseas Bank Ltd and hence are not comparable. On annual basis, the bank posted a net profit of Rs 1,008.43 crore for the 12-month period ended March 31, 2007 and the total income was at Rs 6,219.12 crore. Bank of India The Bank of India (BoI) has posted a 75.68 per cent jump in its net profits at Rs 447.44 crore for the fourth quarter ended March 31 as against Rs 254.42 crore for the same period in 2006. Total income of the bank grew by 37.20 per cent to Rs 3,192.13 crore for the three months ended March 31, the BoI informed the BSE. The board has recommended a final dividend at 15 per cent for the financial year 2006-2007 on equity shares. With this, the total dividend during 2006-07 amounted to 35 per cent, including interim dividend at 20 per cent declared and paid in December 2006. On annual basis, the bank posted a net profit of Rs 1123.17 crore as against Rs 701.44 crore for the year ended March 31, 2006 and the total income also increased to Rs 10,743.28 crore. Indian Bank The Indian Bank has reported an increase of 69 per cent in net profit at Rs 235.31 crore for the quarter ended March 31, 2007 as compared to Rs 139.16 crore for the corresponding quarter last year. Total income of the bank increased by 43.18 per cent at Rs 1,563.61 crore. The board of directors recommended a dividend of 20 per cent and a special dividend of 10 per cent on the equity share capital to mark its centenary year celebrations and 8 per cent on the preference share capital for the year 2006-07. During 2006-07, the bank posted a net profit of Rs 759.77 crore as compared to Rs 504.48 crore in the last fiscal. Total income increased to Rs 5017.86 crore for the year ended March 31, 2007 from Rs 3827.74 crore for the year ended March 31, 2006. — Agencies
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Pepsico’s expansion plans for Punjab
Chandigarh, April
24 In addition, company will also collaborate with the state government in the fields of education, health, rural sanitation and supply of clean drinking water. This was stated by Sanjeev Chadha, CEO Pepsi International, during his interaction with Chief Minister Parkash Singh Badal here this evening. He said company’s contract operations in the farm sector ranged from potato production to apple and citrus fruit and it will expand to blackberry and pomegranate. He said through the use of state-of-the art technology, the company had brought usage of water down to one third of the original. The same techniques could be used to promote water preservation on large scale operations in the state. He explained that the latest technology of rice plantation through seeds adopted by the company on 15000 acres in Jalandhar district would prove to be a shot in arm to save labour on paddy transplantation. Badal emphasized that the big companies must fulfill their social obligations and help to reduce economic disparities in the state. "It is in the interest of the rich segment to help the process of economic justice and equality as a stable society is the prerequisite for any development and prosperity," said
Badal.
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Shareholders approve merger of RIL-IPCL
New Delhi, April 24 In the court convened meeting of shareholders, secured creditors and unsecured creditors of RIL held on April 21, 99.9 per cent of the shareholders- representing 99.99 percent of the total value of the equity shares held by them- voted in favour of the scheme of amalgamation. Seven shareholders, representing 0.0006 per cent of the total value of shares, voted against it. The company has filed a petition today seeking approval of the high court of judicature at Bombay for sanction of the scheme. Earlier, the shareholders, secured creditors and unsecured creditors of IPCL had approved the scheme at the respective court convened meetings held on April 14. —
UNI
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Private sector workers to get Shram awards
New Delhi, April 24 The awardees will be decorated with Shram Bhushan, Shram Vir/Shram Veerangana and Shram Shree/Shram Devi awards in recognition of their distinguished performances, innovative abilities and outstanding contributions in the fields of productivity, exhibition of exceptional courage and presence of mind, a press release said. These workers are employed in various private sector units employing 500 workers or more, departmental undertakings and public sector undertakings of the central and state governments. The private sector has also been brought within the ambit of the awards and the number of awards has also been increased from 17 to 33. Twenty nine awardees are from the public sector while 16 workers belong to the private sector. Some of them have bagged the awards jointly. No nomination was found suitable for the top most prestigious honour of Shram Ratna Award but in lieu of Shram Ratna/Shram Bhushan Awards, three additional Shram Vir/Shram Veerangana awards and one additional Shram Shree/Shram Devi Awards are being given. S P Gupta, chargeman BHEL, Hardwar has been conferred with the second highest Shram Bhushan Award. It carries a cash award of Rs 1,00,000 and a ‘Sanad’.
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