Reliance net vaults 16 per cent to 510 crore
MUMBAI, July 8 — Reliance Industries Ltd — today reported a 16 per cent jump in its net profit to Rs 510 crore in the first quarter of the current fiscal as against Rs 441 crore in the corresponding period last year.


Punwire benefits from new policy
CHANDIGARH, July 8 — The government’s decision allowing existing telecom service operators to migrate to a revenue-sharing arrangement has cheered the paging industry.

Gold prices may decline further
NEW DELHI, July 8 — The international prices of gold can dip further as other Central Banks may follow Bank of England to convert the yellow metal to higher return earning assets.

‘Arrange power pooling’
NEW DELHI, July 8 — The Deputy Chairman of the Planning Commission, Mr K C Pant today called for allowing open access to transmission and distribution facilities by power utilities for supplying power cheaply to consumers and encouraging investment into the transmission network and generating capacities.

BFL net drops

Reliance net vaults 16 per cent to 510 crore

MUMBAI, July 8 (PTI) — Reliance Industries Ltd (RIL) — today reported a 16 per cent jump in its net profit to Rs 510 crore in the first quarter of the current fiscal as against Rs 441 crore in the corresponding period last year.

The total sales of the company increased 5.26 per cent in the same period to Rs 3,837 crore from Rs 3,645 crore in the previous year, the company announced after the Board meeting here today.

However, RIL exports declined by 8.23 per cent to Rs 156 crore during the April-June period of 1999 from Rs 170 crore in the corresponding period last year.

RIL Managing Director Anil Ambani said: “The improvement in demand in the Asia-Pacific region, coinciding with the capacity outages in the global petrochemical industry, led to a sharp recovery in product prices in the first quarter.”

“The recovery has already shown signs of weakening, based on present market trends we believe that the current momentum in earnings growth is unlikely to be sustained over the rest of the fiscal.” he added.

RIL claimed it was the first Indian corporate to report profits over Rs 500 crore in a single quarter.

The operating profit of the bluechip rose 12 per cent to Rs 900 crore in the quarter ended June 30 from Rs 804 crore in the same period last year.

The production volume of RIL also rose 12 per cent to 1.9 million tonnes during the quarter from 1.7 million tonnes in 1998-99.

The company had revalued its plant and machinery in Patalganga and Naroda during the fiscal 1997-98, consequent to which there is an additional charge for depreciation of Rs 96 crore for the quarter ended June 30, 1999.

RIL said an equivalent amount has been drawn from the general reserve, adding this had no impact on the profit for the quarter.

Ambani said the commissioning of the Rs 5,500 crore integrated petrochemicals complex at Jamnagar in Gujarat has already begun. The complex comprises the world’s largest 1.4 million tonnes for annum (MTPA) paraxylene and 600,000 TPA polypropelene facilities.

The entire complex will be commissioned in the current financial year itself, ahead of schedule.

RIL’s plan for the Y2K compliance is proceeding as scheduled and the majority of the business and manufacturing systems will become compliant in the second quarter of the fiscal.

The production from the Panna-Mukta-Tapti oil and gas fields, in which Reliance holds 30 per cent interest along with Enron and ONGC saw an increase. According to RIL, the oil production rose 31 per cent while the gas production jumped 36 per cent.

Punwire benefits from new policy
Tribune News Service

CHANDIGARH, July 8 — The government’s decision allowing existing telecom service operators to migrate to a revenue-sharing arrangement has cheered the paging industry. The paging operators can now share revenue with DoT instead of paying a high annual licence fee. The extent of revenue sharing will be determined by TRAI but it is expected to be about 5 to 15 per cent of the revenue generated. The paging service industry, which has earlier suffered because of low differential between cellular and pager rentals, has reasons to feel satisfied with the steep increase in rentals of cellphones and also a hike in the call charges. All calls to cellular phones from PSTN will be at least three times more expensive than those to the pagers.

One of the major players in this sector, Punwire, which had a lot at stake in the form of its countrywide paging service, has now enough reasons to feel elated. The company was not able to achieve financial closure earlier for its wide area paging project due to high licence fee liability amounting to Rs 40 crore per annum. Under the new policy the company has to just pay Rs 2.5 crore. The shift to revenue-sharing will ease cash flow and increase the viability of the project. Also the licence fee arrangement was a major hurdle for equity investment as both Indian and foreign investors shied away from the project because of the quantum of licence fee. This is all set to change now.

Punwire, which is already in dialogue with some domestic and foreign institutional investors, plans to invite equity finance to the tune of Rs 150 crore.

The shifting of effective date of licence by six months means a further saving of Rs 20 crore. The project will now have an IRR, which is similar to the projects in the Internet and IT industry.

Besides, Punwire is planning to put paging on the Internet and offer features like e-mail notification on pager etc., thus turning pager into an effective wireless data communication device. This is in addition to the nationwide roaming, which Punwire offers to its subscribers.

Punwire has set up the country’s largest paging network, covering 12 States and nearly 150 cities through its subsidiary companies — PMCL and PPSL. The company is now poised to take full benefit from the national telecom policy and as a first step it is planning to hive off as a separate company its satellite communication business to reduce its debt burden.

Also the company is inviting equity for its radio trunking business, which is operational in all major cities. The demand for equipment from various telecom service operators will bring more orders to the company and lead to improved bottomline.

Gold prices may decline further
Tribune News Service

NEW DELHI, July 8 — The international prices of gold can dip further as other Central Banks may follow Bank of England (BoE) to convert the yellow metal to higher return earning assets.

Analysts said that the BoE’s move to sell 25 tonnes of gold is actually reflective of pattern to convert the Central Bank’s assets into pounds or dollars.The decision to auction was first of a four-year programme to switch more than half its gold reserves into foreign currencies.

The bullion sales in the UK yesterday triggered the yellow metal’s price to slump to a 20-year low. In India gold prices nosedived by Rs 70 per 10 gram in the Mumbai bullion market. In London the price, following the auction, fell below $ 258 an ounce for the first time since May 1979.

A similar slump in gold prices was witnessed when the Australian and Russian Central Banks opted to sell gold thereby creating excess supply in the market.

Analysts pointed out that the Swiss Central Bank and the IMF could also follow suit and in the process push gold prices further down.

It is believed that the Central Bank of Switzerland would sell as high as 2000 tonnes of gold while the IMF was said to be contemplating offering 400 tonnes of gold into other assets through the open sale route.

“This is basically reflective of pattern that globally the Central Banks are looking to convert gold to high return earning assets”, Mr Chand Mehra of Mehrasons told The Tribune adding that “This is basically a prelude to continued downturn in gold prices”.

The downward spiral in gold prices could be arrested only by a commensurate increase in demand. “This, however, does not seem to be happening at the moment”, an analyst said .

“In India, for instance which accounts for about 30 per cent of world gold consumption, the demand for gold has come down by 14 per cent after import liberalisation” he said.

“It appears that the gold market in India has reached some kind of a saturation as it is basically a ‘forbidden asset’, meaning that a unlike consumer durables, a downward fall in prices would not spark-off a demand boost for those who have already purchased gold”, Mr Mehra pointed out.

Moreover, for there appears a distinct shift in preference from gold to diamonds in the case of jewellery.”As far as only jewellery is concerned, there is a very distinct shift in towards jewellery”, he said adding that over a period of time this could affect the gold demand significantly.

‘Arrange power pooling’
Tribune News Service

NEW DELHI, July 8 — The Deputy Chairman of the Planning Commission, Mr K C Pant today called for allowing open access to transmission and distribution facilities by power utilities for supplying power cheaply to consumers and encouraging investment into the transmission network and generating capacities.

Inaugurating a seminar on developing the power market in India organised by Assocham here , Mr Pant outlined broad contours of second generation reforms in the power sector.

Mr Pant said that reforms should allow full freedom to the consumer to get from the distributing/ generating company of his choice as also introduce differential pricing according to the time of the day.

The focus should be on power pooling arrangements and the possible market structure for such power pools.While the pooling infrastrucutre (regional grids) is already in place,” it is time to ponder over the improvements that are required to realise additional economic and operational benefits through power pooling”.

There was need to assess whether there was any requirement for an independent “system operator” to control the transfer and trading of power and adopt a model most suited for the Indian power system.

ICICI customer wins Matiz car
Tribune News Service

CHANDIGARH, July 8 — Mr Vivek Kashyap, Marketing Manager (Punwire) and an ICICI customer from Chandigarh, received a Matiz car as the first prize from Mr Kanwar Vivek, Regional Manager, ICICI Capital Services here today.

Mr Kanwar said the ICICI had initiated a “Help us know you better” exercise among its customers. The objective was to understand their financial needs and preferences, which will enable ICICI to offer benefits and services relevant to them.

Other prizes offered by the ICICI were two 21 inches colour TV sets, five stereo systems and 400 walkmans from Philips. ICICI also offered 50,000 early bird prizes — a R.K. Laxman Z-card with tips on financial planning. The exercise received an overwhelming response from five lakh out of 23 lakh questionnaires mailed to investors.

The car comes as a gift from the ICICI and the customer will not have to pay any tax. The company treats it as marketing expenditures, clarified an ICICI official.

BFL net drops

CALCUTTA, July 8 (UNI) — BFL Software has reported a 17.51 per cent decline in its net profit during the first quarter of the current financial year. The net profit in the first quarter this year came down to Rs 4.21 crore from Rs 5.09 crore in 1998-99. The company’s income from software development during the quarter improved to Rs 28.76 crore from Rs 22.36 crore in the first quarter of the previous fiscal and other income jumped to Rs 0.67 crore from Rs 0.19 crore.

Rolta India net up 43 pc

MUMBAI: Rolta India Ltd has posted 43 per cent growth in net profit at Rs 15.07 crore for the second quarter ended June 1999, on a total income of Rs 41.33 crore, registering a rise of 27.4 per cent over the same period the previous year.

The earning per share for the quarter on an annualised basis worked out to Rs 10.98 as against Rs 7.63 for the year ended December 1998, the company said in a statement here today.

Sonata Software

BANGALORE: Sonata Software Limited achieved a total revenue of Rs 360.54 million, registering an increase of 40 per cent for the quarter ended June 30, 1999. The company’s profit after tax was Rs 42.83 million showing a growth of 111 per cent, according to a Sonata press release.

Essar Cell
NEW DELHI, July 8 (TNS) — Essar Cellphone today announced the launch of localised tariff plan for North India — called Come Home. By subscribing to the Come Home airtime plan, a subscriber will be eligible to avail a flat airtime rate of Rs 2 per minute, when he is in Gurgaon and Noida. The tariff plan becomes applicable on any call initiated (incoming and outgoing both), while the subscriber is in physical boundaries of his chosen home zone. However, when the subscriber is outside his designated home zone, standard airtime rates will be applicable, a company release said.

Donation
CHANDIGARH, July 8 (TNS) — The Chandigarh Plywood Dealers Association (Regd) donated Rs 51,000 in Army Central Welfare Fund, New Delhi. Besides, Rs 30,000 as cost of 100 dresses for the injured soldiers at Command Hospital Chandimandir.

Punj Canwest
CHANDIGARH, July 8 (TNS) — Punjland Canwest Alliance which offers immigration services for Canada has decided to provide skill upgradation facilities to strengthen cases with the immigration office. Canada’s current birth rate at 1.7 per cent is far below the replacement level.