Chevron to appeal against $8.7 bn fine
Insurers bank on rural areas
Sebi plans to cut red tape for stock brokers, others
HPGCL to import Indonesian coal for its thermal plants
BSE, NSE see little chance of mergers
DLF Brands to invest Rs 200 cr in 3 years
Allahabad Bank raises FD rates
Lago Agrio (Ecuador),
The indigenous farmers said the award would not cover cleanup costs and that they plan to press for more money at a provincial court in the heart of the jungle later this week.
“It’s not fair to us because the tribes have suffered a lot,” plaintiff Justino Piaguaje said of Monday's ruling by Sucumbios provincial court. The 17-year-old legal saga is being closely watched for precedents by the global oil industry.
"Our families have died, and our rivers have deteriorated." Piaguaje is one of 47 named plaintiffs in the lawsuit and a member of the Secoya indigenous group, which has said there is a higher incidence of cancer in the Rhode Island sized area named in the case. Chevron denies responsibility for any damages and has rejected the ruling as illegitimate and unenforceable.
The plaintiffs’ lead lawyer, Pablo Fajardo, did not reveal details of the appeal, but his team had been seeking at least $27 billion and may seek to pursue Chevron assets abroad.
The company has also vowed to appeal the ruling and has claimed fraud on the part of the plaintiffs and their lawyers. The case has spawned a plethora of international legal actions.
A resolution could take years, and few analysts expect the US oil company to pay anything soon.
Leftist President Rafael Correa defended the independence of Ecuador's courts despite accusations from Chevron of government interference by siding with the plaintiffs.
"It was the most important judgment in the history of the country," he said.
Both sides have until Thursday to present appeals against his ruling.
Chevron, which made $19 billion in net profit last year, has no assets in Ecuador and believes it is unlikely ever to pay. It plans to block enforcement in US courts.
The company, based in San Ramon, California, denies that any health problems in the region are its fault and has said it cleaned up any pollution for which it was responsible.
Despite disagreeing with the size of the award and wondering whether any money would ever be paid, some farmers were nevertheless pleased that Chevron was found guilty.
"Over and above the amount in damages, we believe that Chevron has been sanctioned. This is a hard blow to Chevron and an important step for the indigenous people of Ecuador," Piaguaje said.
The judge’s ruling specifies the damages should be put into a trust fund managed by an independent body.
Investors and the oil industry believe the Ecuador case could set a precedent leading to other large claims against companies around the world that have been accused of contaminating countries where they operate.
“It is the first time that indigenous people have sued a multinational corporation in the country where the crime was committed and won,” environmental group Amazon Watch said. — Reuters
Insurers bank on rural areas
Chandigarh, February 16
Most private life insurers have realised that growth will come mainly from over 90 per cent of the so far untapped households in rural areas. A recent study by ASSOCHAM on Rural India and its New Investors says that only 8- 10 per cent of the rural households are covered under life insurance, while the remaining 90 per cent can be targeted with innovative insurance schemes. The industry body expects that Rs 1,000 crore can be added to the networth of these insurance companies from the 200 million rural households, that are looking for alternative savings channels for their surpluses, provided these come out with innovative schemes at affordable premium.
Companies like Max New York Life Insurance, Canara HSBC Oriental Bank of Commerce Life Insurance, and ING Life Insurance are not just meeting the requirement for rural insurance set by Insurance Regulatory and Development Authority (IRDA), but are surpassing these targets.
“Nowadays companies are developing viable and cost-effective distribution channels; building consumer awareness and confidence. An extensive rural agent network for sale of insurance products is being established by most players. We are going in for customer education and consciousness to motivate purchase of insurance products, especially those that offer guaranteed returns,” said Ajay Kapoor, executive vice president, ING Life Insurance.
Max New York Life, which sells 28 per cent of its policies in rural areas, too, is considering new micro insurance products. “Our focus is on strengthening our distribution channels in rural areas. We foresee that insurance penetration can be achieved in 60 per cent of the rural households, which offers us a tremendous potential for growth,” said V Viswanand, director and head- products and persistency. He was in town to launch a new child plan for funding the college education of children.
Canara HSBC Oriental Bank of Commerce Life Insurance offers special endowment plans for rural customers.The company is planning to add more low-priced traditional plans with simple underwriting to encourage the habit of saving, alongwith providing protection for fixed term for the rural segment. “We are tying up with regional rural banks to reach out to the rural population,’ he added.
New Delhi, February 16
The market entities to benefit from this step would include stock brokers, merchant bankers, credit rating agencies, debenture trustees, registrars and share transfer agents, underwrites and bankers to an issue.
Presently, these entities are required to seek a prior approval from Sebi for any change in their ‘status or constitution’.
Such changes in status include change in control, amalgamation, demerger, consolidation or any other corporate restructuring exercise, as also change in legal status of the market intermediary.
The changes in constitution that require Sebi's prior approval include change in managing director or whole-time directors, proprietor, partners etc.
As per the proposed revision of its regulations, Sebi wants the market entities to seek its prior approval, only in the case of a change in control for which the intermediary has a knowledge, a senior official said.
For other changes, the market entities would need to inform Sebi in their various periodical filings.
A proposal to do away with these regulations was discussed at the Sebi's last board meeting and the necessary amendments to bring about the proposed change in norms could be notified soon, he added.
The official said that Sebi has been receiving more than 100 requests per month from various market entities seeking regulator's prior approval for changes in their status or constitution.
Although, a big majority of these requests relate to very small and even insignificant changes, the market entities are obliged to do so for complying with the regulations.
Given the sharp increase in the number of market intermediaries and the volume of requests, the regulator has found processing of these applications quite time consuming.
At the beginning of the current fiscal, there were more than 8,800 stock brokers, close to 75,400 sub-brokers, 164 merchant bankers, 74 registrars and share transfer agents, 48 bankers to an issue and 30 debenture trustees.
Besides, Sebi observed that a number of entities, such as those from the public sector where senior-level appointments are decided by the government or their parent banks, find it difficult to seek prior approval for such changes.
Therefore, Sebi found it desirable that the time spent on processing these requests be utilised for working towards growth and oversight of the market, addressing investors' complaints and other policy related issues. — PTI
HPGCL to import Indonesian coal for its thermal plants
Panipat, February 16
Sources said HPGCL has placed an order for 1.45 million tonnes MT of imported coal. The corporation would be supplying the Indonesian coal to Khedar, Panipat and Yamunanagar thermal plants. Thermal plants in Haryana were getting coal of ‘F’ grade, with high ash content. Due to poor coal quality the units at Khedar thermal plant were not able to achieve full load capacity of 600 MW.
Mumbai, February 16
BM&FBovespa is on the lookout for opportunities to expand in China and India but the sources, who have direct knowledge of the situation, said the unlisted Bombay Stock Exchange and National Stock Exchange have not held any talks with the Brazilian operator for any kind of alliance.
"While the overseas exchanges may look at picking up a minority stake as others have done as strategic investments, there will not be any large-scale merger," said one of the sources, referring to global M&A drive among exchanges.
BM&FBovespa Chief Executive Edemir Pinto singled out China and India for their growth potential and similarities with the Brazilian market, in an interview with Reuters on Monday, as a wave of merger deals swept through the industry.
Deutsche Boerse agreed on Tuesday to takeover NYSE Euronext in a $10.2 billion deal to form the world's largest exchange operator.
Singapore Exchange, Asia's second-largest listed bourse, is pursuing a merger with Australian operator ASX Ltd and the London Stock Exchange has agreed to buy Canada's TMX.
The Indian sources, who declined to be identified because they are not authorised to talk to the media, said regulations alone would be enough to scupper any potential deals and analysts added there was little prospect the government would want to loosen the takeover rules in the near future.
In India, regulations limit equity ownership of a single foreign entity in a market operator to 5 percent.
Officials at the Bombay Stock Exchange and National Stock Exchange were not available for comment.
Deutsche Boerse and Singapore Exchange each hold 5 percent stakes in the Bombay Stock Exchange, the oldest stock exchange in Asia. The combined market capitalisation of the companies listed on the exchange totals more than $1 trillion.
U.S. billionaire financier George Soros in August bought a 4 percent holding in the Bombay Stock Exchange for about $35 million from Dubai Financial, part of sovereign fund Dubai Holding.
Singapore state investor Temasek bought a 5 percent stake in the National Stock Exchange, whose market has a total capitalisation of around $1.6 trillion, in May last year from NYSE Euronext.
"The guidelines are quite tough in India in the sense that overseas investors are not allowed to own more than 5 percent stake," said Jagannadham Thunuguntla, head of research SMC Global Securities in New Delhi .
"I don't think we are going to see the global exchanges merger game coming in India in a big way. The Indian exchanges will continue to explore tie-ups for sharing best practices and technology know how," he said.
The exchange ownership rules are not likely to change in the near future as the government would be reluctant to give control of the two top exchanges to foreign investors, analysts said.
"In India, the exchanges operate more as semi-regulators, and the government won't like to change them into full commercial bodies with decision making powers centered with two or three people," Thunuguntla said.
"And this rule is unlikely to be changed any time soon."
The Bombay Stock Exchange is about 40 per cent owned by stock brokers, 27 per cent by foreigners and the rest by corporate entities. — Reuters
New Delhi, February 16
The company today opened the first outlet of its flagship home decor and accessories brand 'Pure Home + Living' in the National Capital.
"Our target is to open 20 stores of 'Pure' in the next 30 months. For this we will be investing about Rs 100 crore... Usually one store needs an investment of Rs 4-5 crore," DLF Brands Vice Chairman Timmy Sarna told PTI.
The company will set up nine showrooms of the brand in the next 12 months in various cities, including Bangalore, Mumbai, Pune, Chennai, Hyderabad and Chandigarh, he added.
"We are expecting Rs 15 crore annual sales turnover from each store after about one year of operations... Our target is to have Rs 200-300 crore sales from our this new initiative in the next 3-4 years," Sarna said.
'Pure Home + Living' will offer a range of products such as furnitures, table, chairs, lamps, mirrors and crockery with prices going up to about Rs 60,000.
Besides, Sarna said the company will invest Rs 40-50 crore every year to increase the presence of retail stores of various international brands across the country.
"We will open 70 stores of various brands, including some new ones, during next fiscal. We are talking to some international brands at present to bring them into the country," he added. — PTI
New Delhi, February 16
The bank, however, slashed deposit rate on a particular slab by 25 basis points.
The bank has decided to revise the interest rate ranging from 0.25 per cent to 2 per cent per annum on various domestic term deposits schemes with effect from February 18, 2011, Allahabad Bank said.
For 270-364 days term deposits less than Rs 1 crore, the bank will pay 7.75 per cent interest, up 25 basis points from the existing rate.
Meanwhile, 5-10 year term deposit holder would get 25 basis point lower return at 8 per cent compared to exiting 8.25 per cent. — PTI