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Overseas investors told to register as FIIs
CDMA players in GSM arena Nath proposes sector-specific sops for exporters
ONGC-Mittal take stake off Turkmenistan
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IPI Gas Pipeline
MCX awaits FMC nod on carbon trading
Greenko plans London listing
Hinduja group eyes insurance biz
Slide stops but wealth erosion doesn’t
FIIs slash holdings in top scrips
Ficci suggests IHCs for banks
Family-owned firms face governance issues: Moody’s
Warburg Pincus to invest in Havell’s
Corporate Results
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Overseas investors told to register as FIIs
Mumbai, October 22 “We will seek to expedite the process of registration, as well as resist the content of regulation, to see what other categories of investors... be included as eligible entities in the registration process,” SEBI Chairman M Damodaran said during his interaction with FIIs through video conferencing. The interaction came three days before the crucial Board meeting of the market regulator and partially helped the stock market bounce back from a 389-point fall early morning to post a moderate gain of 54 points at closing. To give an example of expeditious registration process in SEBI, Damodaran said 16 FIIs were registered today itself. However, Damodaran gave clear hints that SEBI’s proposals on P-notes will be implemented. “We believe that responses we have on board at this point in time, are adequate for us to take the process forward, in terms of the inputs received and those that we might receive,” he said. SEBI had invited comments on its discussion paper that sought to wind up derivatives-based P-Notes in 18 months, and put curbs on PNs based on assets under management by FIIs. Sticking to the 18-month deadline of doing away with derivatives-based P-Notes, he asked sub-accounts (FII agents) to register as FIIs for participating in the Indian markets. There are over 1,100 FIIs presently registered with SEBI. Of these, hardly 33 deal in participatory notes and have set up proprietary sub-accounts to deal with these instruments. He said sub-accounts wanting to convert to FIIs must inform SEBI within a day and apply in a week.
— PTI
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CDMA players in GSM arena
New Delhi, October 22 The petition is ready, a COAI official said, adding: “We shall be waiting for TDSAT to open tomorrow to file our petition opposing new rules in telecom sector - allowing CDMA players to start GSM mobile services and increasing subscriber limit for additional spectrum.” The COAI has also accused the Department of Telecom (DoT) of acting with malafide intentions to favour a particular CDMA operator. Although COAI officials did not name the company, it is understood that the GSM lobby is opposing permission granted to Reliance Communications (RCom) for offering GSM services. The other two companies to have received the approval along with RCom are Mahendra Nahata-promoted HFCL and Shyam Telecom. Asked whether all GSM operators are of the similar view, COAI officials said there was unanimity and the entire COAI minus Reliance Telecom has desired to challenge the DoT’s decision of October 1. The DoT has also increased the subscriber limit for allocation of existing spectrum, which would hurt the interest of incumbents, including Bharti Airtel, Vodafone-Essar and Idea Cellular. Meanwhile, Tata Teleservices said it has submitted application for the GSM spectrum under the new guidelines laid down by the Department of Telecommunications (DoT), allowing existing licencees to use spectrum and offer services in both CDMA and GSM technologies. “We look forward to a level playing field in the industry and await clarity on all aspects of this new announcement from the authorities,” said a company’s spokesperson. — PTI
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Nath proposes sector-specific sops for exporters
New Delhi, October 22 Nath said his ministry was preparing a Cabinet Note for expanding coverage of refunds to exporters. “We are looking at measures for refund and remission of taxes to ensure that exporters get a level playing field,” Nath told newspersons before a review meeting to assess the export performance of the plantation sector here. Asserting that he was still hopeful of India achieving the export target of $160 billion during 2007-08 despite currency related troubles, the minister said he would take an overall export review meeting with different export promotion councils in November. Though most of the Asian currencies have appreciated against the US dollar since April this year on the back of strong capital inflows into the region, the Indian rupee has risen by the highest margin amongst her emerging market peers. The rupee has risen 10.08 per cent against the dollar, while Chinese yuan rose only 2.93 per cent during the period. Though currency appreciation means lower import costs, it hurts the export competitiveness, particularly because the rupee’s appreciation has been the fastest among most of her competitors. Though the government had announced a Rs 1,400-crore package for exporters in July and exempted seven items from service tax, it has been found to be inadequate in the light of sharp rise in rupee. India is giving priority to boost trade with European Union and foresees no difficulty in signing a free trade and investment agreement with EU, notwithstanding wide differences between the two sides in the WTO over the Doha Round of trade talks. India and EU are negotiating a free trade and investment agreement aimed at phasing out and eliminating import duties on a large number of trade items.
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ONGC-Mittal take stake off Turkmenistan
New Delhi, October 22 "Covering an area of 5,663 sq km, the block is located close to discovered and producing fields, and contains a number of prospects with significant reserve potential," a company press note said here. OVL is state-run Oil and Natural Gas Corp's overseas arm while MIS is steel baron Lakshmi N Mittal's holding firm. Discoveries have been made in adjoining areas such as Ashrafi and Karabakh, the press note said but did not give the acquisition cost. Block 11-12 was earlier awarded by the Government of Turkmenistan to Maersk Oil in December 2002. "The consortium now comprises OMEL, German company Wintershall with 34 per cent and Denmark's Maersk Oil with 36 per cent participating interest," it said. Earlier, Wintershall and Maersk had acquired seismic data and drilled one exploratory well in the block. The well had provided indications of hydrocarbons. Another well is planned to be drilled by the new consortium during 2008. Turkmenistan block is the fourth asset of OMEL. It had earlier acquired interest in a producing asset in Syria, which is currently producing about 130,000 barrels of oil per day. The company was also awarded two highly prospective blocks in Nigerian deepwater - OPL 279 and OPL 285. "OMEL is pursuing hydrocarbon assets in certain other countries also, some of which are in an advanced stage of negotiations," it said but did not give details. ONGC chairman and managing director and OVL chairman R S Sharma said this exploration block in Turkmenistan was a significant milestone in the group's growth path. — PTI
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IPI Gas Pipeline
New Delhi, October 22 India refused participation in an official level talks on the gas pipeline in Teheran last month, saying it wanted transit fee issue with Pakistan to be resolved first before it could attend a trilateral meeting. Sources said New Delhi and Islamabad have reached broad understanding on the transportation tariff payable to Pakistan. But the two nations have not yet arrived at an agreement on a transit fee payable to Pakistan. New Delhi has not yet conveyed its acceptance of the invitation to Pakistan, they said. They added that India and Pakistan have narrowed down differences on transportation tariff. Islamabad earlier wanted $0.7 per mBtu as wheeling charges but New Delhi was willing to pay no more than $0.55 per mBtu ($220 million annually). The two sides have now agreed to base it on actual cost of building and operating the 1,035-km pipeline. But differences continue on transit fee with Islamabad seeking $0.493 per mBtu while New Delhi has offered $0.2 per mBtu. — PTI
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MCX awaits FMC nod on carbon trading
Mumbai, October 22 “The exchange has already filed the contract with the commodity market regulator Forward Markets Commission (FMC) for approval. The same will be launched as soon as it is approved,” deputy managing director, MCX, Joseph Massey said. He said: “On the MCX platform, contracts with underlying (carbon emission reductions) CERs would be bought and sold by the market participants pouring in information about various factors that affect the supply and demand for CERs in markets, where they are deliverable.” On being asked what was the motive behind tying up with MCX, Massey said India is supposed to be a major supplier of carbon credits and the tie-up is expected to ensure better price discovery.
— PTI |
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Greenko plans London listing
London, October 22 Greenko generates revenues by supplying electricity to India’s rapidly growing economy and selling carbon emission reduction units. The company aims to raise up to 60 million euro through issue of ordinary shares to institutional investors in an offering expected to complete in November, the company stated. Greenko Group CEO Anil Chalamalasetty said: “Greenko is an Indian clean energy company with an experienced management team, a growing portfolio of assets and a clear strategy of future growth.” It stated that the issue proceeds would be used to fund the first phase of expansion towards 400-MW capacity by 2010-11, through acquisition and investment in the ongoing projects. It has appointed Arden Partners plc as nominated adviser and broker for the proposed offering.
— PTI |
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Hinduja group eyes insurance biz
Chennai, October 22 India’s healthcare industry is valued at $30 billion that includes pharmaceuticals, health care, diagnostics and surgical equipment supplies, according to India Brand Equity Foundation. “We are also in talks with insurance companies to provide life and non-life insurance products,” Hinduja Group of Companies president Dheeraj Hinduja said here.. — PTI
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Slide stops but wealth erosion doesn’t
Mumbai, October 22 The net worth of the five richest - Mukesh and Anil Ambani, KP Singh, Sunil Mittal and Azim Premji - today plunged by Rs 11,015 crore, taking their total loss to about Rs 67,200 crore (close to $17 billion) since October 17, when the meltdown began on the bourses. This was in contrast to the total investor wealth, measured in terms of market capitalisation of all the listed companies, gaining close to Rs 6,500 crore today to Rs 54,71,500 crore. The companies, where the five corporate tycoons have promoter holdings, collectively lost about Rs 1,25,000 crore in the past four trading sessions, taking their total market cap close to Rs 10,32,750 crore at the end of today’s trading. The total net worth of the five richest stood at Rs 5,96,700 crore as of today. Mukesh Ambani, the richest of all, saw a further erosion of close to Rs 4,000 crore today, which took his net worth to Rs 2,01,800 crore. He has seen a total loss of close to Rs 19,000 crore in his wealth, measured in terms of promoter holdings in his group companies. His younger brother Anil saw a relatively smaller loss of close to Rs 300 crore today, as two of his group firms Reliance Energy and Reliance Capital recorded gains in their share prices. Anil’s total loss in the past four sessions stands at about Rs 16,000 crore, taking his net worth to close to Rs 1,37,000 crore. The BSE’s 30-share barometer index, Sensex, today rose by 54 points after losing close to 1,500 points in the past three trading sessions triggered by concerns that regulatory measures to curb issuance of offshore derivative instruments like P-Notes would adversely impact foreign investment in Indian equities. Real estate giant DLF’s K.P. Singh saw a further erosion of close to Rs 2,500 crore in his net worth to Rs 1,21,000 crore. Singh has seen a total erosion of close to Rs 17,400 crore since October 17. Bharti Airtel’s Sunil Mittal saw his net worth eroding by close to Rs 3,500 crore today, taking the four-day loss to Rs 15,700 crore, while Wipro’s Premji lost close to Rs 700 crore. However, Premji has actually gained close to Rs 1,000 crore in the recent crash, as the share price of Wipro has defied the broader market meltdown in the past few days. — PTI
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FIIs slash holdings in top scrips
New Delhi, October 22 The FIIs reduced their shareholding in about 15 companies present in the benchmark Sensex, including Ranbaxy, Airtel, Ambuja Cement, Tata Motors and Mahindra and Mahindra, during the July-September quarter, according to an analysis of shareholding pattern in these companies by PTI Research. — PTI
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Ficci suggests IHCs for banks
New Delhi, October 22 In a note to the RBI, Ficci has pointed out that since it may not be immediately possible to constitute a financial holding company or a banking holding company due to the absence of a regulatory act, it would be desirable to have an IHC as this structure would help de-risk a bank. |
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Family-owned firms face governance issues: Moody’s
New Delhi, October 22 However, these companies have responded well to opportunities available in the fast-growing and liberalising economy, according to a joint survey by Moody's Investors Service and its domestic associate ICRA Ltd. "The lack of board nomination sub-committees in many companies suggests that succession planning is not fully deliberated with independent directors. There is often insufficient transparency on ownership/control, related-party transactions and the group's financial position," Anjan Ghosh, ICRA's general manager and a co-author of the report, said. Also, the prospect remains of higher leverage as families try to maintain control while implementing their often aggressive growth plans, he added. Family control can raise specific corporate governance concerns, with potentially negative credit implications, including - adaptability, leadership transition, checks, balances and transparency, the report said. The survey covered 32 companies in 16 prominent family groups, covering a broad cross-section of Indian industry. Besides the top three corporate houses, the survey also included companies belonging to Godrej, Vedanta, Wipro, Essar, Bharti, TVS and Muruguppa groups among others. Although the report did not mention specific instances, such issues in some of the top groups are well known. While the Reliance empire has been split between the two Ambani brothers - Mukesh and Anil, the Tata group has been searching for a successor to chairman Ratan Tata. Moody's also said there were material residual issues regarding checks and balances, but these were generic to corporate India and not isolated to family companies. For example, the lack of activist shareholders and a business and cultural environment does not permit hostile mergers and acquisitions. Further, important governance issues persist in areas not covered by regulation. The report also noted that despite regulations regarding independent board directors, families retain significant control over listed companies. As such, the difficulty in ascertaining the true independence of directors is a big corporate governance challenge. Family-owned companies, which comprise 17 of the 30 Sensex stocks, have specific characteristics compared to firms with more widespread share ownership as some concerns remain. Positive characteristics of family control can include a long-term perspective and an ability to act quickly. — PTI
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Warburg Pincus to invest in Havell’s
New Delhi, October 22 Havell’s will issue fresh shares and warrants to Warburg Pincus, representing about 11.2 per cent of its fully diluted share capital. Warburg Pincus’ investment will be utilised to partly retire the debt raised during the Sylvania acquisition and in strengthening the company’s manufacturing capacity and distribution network to address the rapidly growing Indian market, the company said. — UNI
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Corporate
Results
Mumbai, October 22 Rolta India
Rolta India has posted an increase of 44.21 per cent in net profit, after minority interest, at Rs 53.82 crore for the quarter ended September 30. The total income of the company rose by 46.65 per cent at Rs 15.28 crore for the quarter ended September 30. LIC Housing Finance
LIC Housing Finance has posted a 53.26 per cent surge in net profit at Rs 116.37 crore for the quarter ended September 30 and the total income of the company also increased by 36.84 per cent to Rs 526.58 crore for the quarter. Hindustan Zinc
Hindustan Zinc has posted a 11.56 per cent decline in net profit to Rs 1,148 crore for the quarter ended September 30 from Rs 1,298 crore a year ago. Total income of the company also decreased by 14.61 per cent to Rs 2,128 crore for the quarter under review. The board of directors also approved the payment of interim dividend of Rs 2.5 per equity share. India Cements
India Cements Ltd has posted a net profit of Rs 222.65 crore for the second quarter ended September 30 and the total income of the company stood at Rs 896.09 crore for the quarter under review as against Rs 591.5 crore for the corresponding three month period last fiscal, the company said.
— PTI |
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New Delhi, October 22
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