Tuesday, August 17, 1999
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B U S I N E S S | Tuesday, August 17, 1999 |
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Maruti, Telco on fast
track; Ford, GM skid Sinha inaugurates website for SSIs |
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Indian Rayon to buy back
25 pc equity Fena forces Hind Lever to alter ad Chautala to review Unitech’s
project Curb on craze for software names Hoteliers form society |
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Maruti, Telco on fast track; Ford, GM skid NEW DELHI, Aug 16 (PTI) — Passenger car sales of Ford, General Motors, Honda and Mercedes were out of track during the first quarter of 1999-2000 while Maruti and Korean companies — Hyundai and Daewoo — witnessed impressive sales. Car sales of General motors, Ford India and Honda Siel and Mercedes declined sharply by 37.6 per cent, 28.4 24.1 and 21.5 per cent respectively during April-June of the current fiscal as against the sales figures recorded in the same period last fiscal. MUL, Hyundai, Daewoo and Telco cornered major chunk of the 38.5 per cent growth recorded by the passenger car segment during the first quarter of the current fiscal, according to the data compiled by the Society of Indian Automobile Manufacturers. Riding on the ‘Indica’ wave, sales of Telco cars went up by 12 times to 7822 units in the period as against only 653 units sold in April-June 1998-99. MUL sales were up by 13.6 per cent to 69,131 cars in the first quarter against 78,395 units in the corresponding period of last fiscal. The passenger car segment grew by 38.3 per cent as all companies together sold 1,29,418 vehicles during the review period this fiscal as compared to 93,547 cars sold in April-June of last fiscal. Ford India witnessed a 28.4 per cent decline in sales during April-June 1999-2000 to 633 units from 884 units in the same period of the last financial year. General Motors, manufacturer of Opel Astra car, also registered the same trend as its sales declined sharply by 37.6 per cent to only 612 units in the period as against 981 cars sold in April-June, 1998-99. Car sales of Honda Siel Cars India Ltd and Mercedes Benz India Ltd also dipped by 24.1 per cent and 21.5 per cent to 2064 units and 262 units, respectively, in the first quarter from 2721 cars and 334 cars in the same period last year. Hyundai sold 12,684 units of its Santro car during April-June this year. The company was not present in the corresponding period of last fiscal as it started commercial operations in India only in the last quarter of 1998. June was quite good for the passenger car industry as the segment witnessed a 46.7 per cent growth. All the companies together sold 39,804 cars as compared to 27,131 cars. The multi-utility vehicles (MUV) segment grew by 2.15 per cent during April-June of the current fiscal with total sales at 25,908 units against 25,537 units in corresponding period of 1998-99. Maruti suffered in the MUV segment as its sales dipped by 5.8 per cent to 1491 units as against 1,583 units. MUV sales of Hindustan Motors and Telco also declined by 5.4 per cent and 16 per cent respectively to 625 units and 6,620 units from 661 and 7,877 vehicles. All other players in the MUV segment improved their sales during the first quarter of the current fiscal. Bajaj Tempo recorded a 25 per cent growth in sales to 1,458 units in April-June of the current fiscal as against 1,167 units sold in the corresponding period of the last fiscal. Mahindra and Mahindra Ltd sales were up by 10.2 per cent during the period. The company sold 15,714 multi utility vehicles as against 14,249 units sold in April-June 1998-99. Growth of the MUV
segment was 3.8 per cent during June as all the companies
together sold 8,738 units as against 8,418 units sold in
the same month of 1998. |
Khattar
new Maruti MD NEW DELHI, Aug 16 — The Managing Director of Maruti Udyog Limited, Mr R.S.S.L.N. Bhaskarudu, today submitted his resignation to the Board of Directors of the company. Mr Bhaskarudu has been appointed a member of the Public Enterprises Selection Board (PSEB) and he will relinquish charge at MUL at the end of business hours tomorrow. Mr Jagdish Khattar will replace Mr Bhaskarudu as the Managing Director of MUL. Mr Bhaskarudu will take up his new assignment on August 18, 1999, after more than a decade’s service in MUL. Bhaskarudu evaded questions on the curtailment of his tenure, which was scheduled till December, and said: “I am going as a happy man having done my bit.” Bhaskarudu’s appointment as MD in August 1997 triggered a bitter courtroom battle between the Government and its equal partner Suzuki Motor Corporation of Japan. The issue was resolved
when the BJP-led government reached a compromise with SMC
and cut short Mr Bhaskarudu’s tenure as Managing
Director. |
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NEW DELHI, Aug 16 (UNI) — A 20 per cent drop in the net profit notwithstanding, the Board of Directors of Maruti Udyog Limited (MUL) has maintained a 30 per cent dividend for the fiscal, resulting in a total outgo of Rs 40 crore. The proposal was recommended at the company board meeting held in Hungary earlier this month, the outgoing Managing Director of MUL, R.S.S.L.N. Bhaskarudu, told newspersons. “The proposal will now be taken up at the annual general meeting for ratification,” he added. The company’s bottomline had been severely affected in the 1998-99 fiscal due to the major price cuts announced on its models. MUL earned a profit after tax of Rs 523 crore for the financial year over Rs 652 crore in the previous year. Following a similar pattern, the profit before tax was down by 19.85 per cent to Rs 783 crore from Rs 977 crore. The total income also took a dive to Rs 8,118 crore from Rs 8,474 crore losing ground by 4.20 per cent. Faced with difficult market conditions and pressure on margins, the company’s internal generation went down to Rs 668 crore from Rs 793 crore. Despite a drastic cut in prices of most of its models, MUL’s total sales of vehicles during the year had declined to 309,094 units from 327,264 units. Production was down to 332,931 from 354,336 units. Interestingly, the
company managed to show increase in its net worth by 23
per cent which improved to Rs 2,606 crore from Rs 2,123
crore. |
Sinha inaugurates website for SSIs NEW DELHI, Aug 16 (PTI) — Finance Minister Yashwant Sinha today asserted that the small scale sector will continue to get due importance even in an era of globalisation in view of its vast potential to generate employment. “We need to push forward the small scale sector and rural industries as they contribute immensely to the nation’s development,” Sinha said inaugurating a website of the Laghu Udyog Bharati here. Sinha’s statement assumes significance in view of demands from certain sections of the industry to dereserve a number of items reserved for the small scale sector and the thrust laid down on “swadeshi” by the election manifesto of the BJP-led National Democratic Alliance. The Finance Minister said there was a need to clearly define the role of Government and markets in the process of ensuring “industrialised nation” status to India. Sinha said the integration of the country into the global economy without small scale industry was not possible. “New industries need to come up, but it should be side by side of the existing units in the small scale sector,” he said. A strong small scale sector was essential to create more job opportunities and assist the employers in the sector to take up greater responsibilities, he added. Laghu Udyog
Bharati’s website — www.Lubindia.org —
will provide industry specific information, new products
in the SSI and bullion and sharemarket update among other
things. |
Indian Rayon to buy back 25 pc equity MUMBAI, Aug 16 (PTI) — Indian Rayon, part of the Aditya Birla group, has proposed to buy back up to 25 per cent of its equity from its shareholders at a price between Rs 70 and Rs 90 per share. The company announced it may also have to close down its sea-water magnesia unit as all attempts to dispose it of so far had not been successful. Explaining the reason for the buyback, Aditya Birla group Chairman Kumaramangalam Birla told reporters here today that the three main businesses of the company — viscose filament yarn, carbon black and insulators — had not been performing well and with no major investments envisaged in these in the future, the share buy-back would enhance shareholder value. The company has a cash surplus of Rs 200 crore and an outgo of around Rs 150 crore (through buy-back) would still leave it in a comfortable position for its operations and future plans. Following the buyback, the promoters’ holding in the company would increase to 28.7 per cent from the present 21.5 per cent. Birla, however, made it clear that buyback would only serve as a means of ensuring returns to its shareholders but this did not mean an end to further investments and expansions in the company. Both proposals would be put up for approval at the company’s annual general meeting on September 17, he said. The company’s board has appointed a committee to arrive at a definite conclusion regarding the future of the magnesia project, which has been found unviable primarily due to the slump in the steel industry and dumping of fused magnesia by China, leading to a huge inventory build-up. The company, which had suspended operations of the sea water magnesia unit in December 1998, today appointed P.C. Gandhi and Associates to valuate the assets of the project and would take a decision for its eventual closure if all other alternatives fail. The company was willing to write off the losses from the sale or closure of the unit to the tune of Rs 300 crore (against which it holds assets of Rs 353 crore), Birla said adding “we rather have a one-time non-cash charge that will boost earnings in future”. The losses would be written off in the second half of the current fiscal. Over the past one year,
the international prices of sea-water magnesia had fallen
from $ 475 per MT to $325, while Chinese imports of the
product were available at $265 to 280 per MT. |
Fena
forces Hind Lever to alter ad NEW DELHI, Aug 16 — The Delhi-based company, Messrs Fena Ltd, manufacturing and marketing “Fena” detergent cake and powder and “NIP” cleaning powder and bar, has forced the MNC giant, Hindustan Lever Limited (HLL), to change its packaging and advertising for its “Wheel” detergent powder and cake through an order of MRTPC. Fena had earlier filed a case with MRTPC against HLL for indulging in unfair trade practices with respect to its claim that Wheel detergent powder and cake contained lemon/nimbu and sought a ban on HLL’s advertisements under Sections 36B and 12A of the MRTPC Act. HLL has given an undertaking to the MRTPC that they have changed the packaging, PoP and advertisement of Wheel detergent cake and powder, removing the words “lemon power” and “with lemon” and have submitted the amended version of polybag, wrapper and story board of advertisement with the affidavit. MRTPC has granted the
right to Fena Limited to revive the proceedings in the
MRTPC in case HLL again resorts to its misleading
packaging, advertising material and TV commercial
mentioning the “lemon” word. |
Chautala to review Unitech’s project NEW DELHI, Aug 16 (UNI) — The Om Parkash Chautala Government will review the Rs 240-crore office complex and global business park in Gurgaon cleared by the previous government, highly placed sources have said. The new Government will review other major building projects in Gurgaon where a host of private builders have made a beeline and are wooing many multi-national companies to book office space. “We will review all major projects”, State sources said adding that the re-assessment will be done at the highest level to ensure whether any irregularity regarding byelaws of HUDA took place. Unitech recently launched its ambitious global business park to come up at three adjoining sites. The sites are owned by the company and two individuals. As per the Government rules, there is a ceiling of four-acre for a private sector business complex. Under the first phase, Rs 125 crore will be spent on completion of the first phase of the project by June, 2000, and the final phase will end by 2001. Unitech has formed two joint venture companies - S.B. Developers Pvt Ltd and Sarvamangalam Builders and Developers. Unitech has 40 per cent stake in each of the two ventures while other shareholders are Vipul Motors and Rajiv Gupta. Unitech has already started marketing of the project. The company is negotiating with Andhra Bank and Canara Bank for financing of the project. It is targeting the multi-national companies for selling about five lakh square feet complex. Talks would also begin with the HDFC. Besides Unitech, other
major firms developing multi-crore projects in Gurgaon
include DLF and Ansals. |
Curb on craze for software names NEW DELHI, Aug 16 (PTI) — The Registrar of Companies will not allow companies to change their names to reflect the business of software until a substantial income is derived from software. The move follows a large number of finance companies changing their names to reflect association with the software sector and misleading investors. In a statement today, it said a company can change its name only if a substantial portion of its income from software business is reflected in audited accounts or accounts certified by a Chartered Accountant. Many companies changed
their names to indicate they were in the business of
computer software and for this companies included words
like Infosys, Software, Computer, Cyber in their names
only to dupe the gullible investors, it said. |
Hoteliers
form society CHANDIGARH, Aug 16 — Certain leading hoteliers of Punjab, Haryana, Chandigarh and Himachal Pradesh have formed the Tourism Promotional Society of Chandigarh (TPSC) with the aim of promoting tourism in the region. The society was formally inaugurated by the Union Minister of State, Mr Omak Apang, last evening. Mr Apang said the efforts of Mr Amardeep S. Dahiya and Mr Manmohan Singh Kohli in promoting tourism were visionary. He said it was good that young blood in the industry was taking bold steps. Earlier, Mr Apang inaugurated the North India Institute of Hotel Management, Panchkula. Appreciating the affiliation of the institute with Queen Margaret University College, Edinburgh (UK), Mr Apang expressed the hope that the institute would offer world-class facilities to its students. Mr Dahiya, Director of
the Institute, said students from California had sought
admission to the institute. |
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