Inflation falls to a 14-year low
NEW DELHI, June 27 — Annual rate of inflation fell to a 14-year low of 3 per cent for the week ended June 12, as prices of food articles, especially fruits, continued to tumble on account of bumper production.

Assocham moots 500 cr for fuel cells
NEW DELHI, June 27 — The Assocham today advocated a Rs 500 crore allocation by the government for a national mission project to set up fuel cells.

FICCI for FDI in housing sector NEW DELHI, June 27 — The FICCI has mooted 100 per cent foreign direct investment in housing sector with ‘adequate checks and balances’ to bridge the shortage of 20 million houses by year 2000.

New cars eat into Maruti’s share
NEW DELHI, June 27 — Market leader Maruti’s share in the car segment declined to 70.8 per cent in May from 87.2 per cent a year ago as new entrants like Hyundai and Daewoo continued to eat up its share by improving their performances.

CII suggests plan for Y2K compliance
NEW DELHI, June 27 — As adverse fallouts of the ‘Y2K problem’ are staring in the face with time running out, there is need for planned national efforts to ensure that India enters the new millennium without hassles, CII has said.

50 pc subsidy for tea cultivation
SHIMLA, June 27 — The Himachal Government has fixed a target for production of 17.02 lakh ton of food grain during the year 1999-2000. The production targets for vegetables and potato have been fixed at 5.20 lakh ton and 1.55 lakh ton respectively.

BIFR rebuffs Videocon plea in Uptron case
NEW DELHI, June 27 — The Board for Industrial and Financial Reconstruction has brushed aside the plea of Videocon International Limited to participate in the revival of the sick Uptron Colour Picture Tubes Limited (now known as BPL Display Devices Limited BDDL) following non-fulfilment of its obligations.

Bisleri targets 500 cr sales
NEW DELHI, June 27 — Bisleri is targeting to double its sales from Rs 250 crore in current year to Rs 500 crore by next year, a top company official has said.

3 cos restrained from using ‘Ceat’ brand
NEW DELHI, June 27 — The Delhi High Court has restrained three companies manufacturing and selling tyres and tubes from using the “Ceat” brand name and appointed local commissioners to take into custody the offending goods.

Kargil fails to affect Indo-Pak trade
Tribune News Service

NEW DELHI, June 27 — Indo-Pak trade is unlikely to get affected because of the border skirmishes in Kargil region of Jammu and Kashmir as majority of the trade is routed through third countries.

The President of PHDCCI , Mr Ashok Khanna told The Tribune in an interview that in most cases trade between the two countries was routed through a different country, and movement of commodities was unlikely to be retarded due to the crisis.

The PHDCCI, which was at the forefront of the formation of the Indo-Pak Chamber of Commerce last February,has enabled several exchanges between business delegations of the two countries in the last couple of months.

The joint Chamber of Commerce between the two countries was formed to identify areas of mutual cooperation and open up opportunities of bilateral trade.

It is also important to legalise the unofficial trade between the two countries as currently the trade through the unofficial route is estimated to stand near $ 1 billion which is almost five times of the official trade ($ 200 million).

Moreover actual value of unofficial or irregular trade may exceed $ 1 billion if the third country trade via Dubai, Hong Kong or Singapore is taken into consideration.

“The extent of unofficial trade between India and Pakistan can be gauged from the fact that no Indian vessel is allowed entry into Karachi port”, Mr Khanna said while observing that the business community of both the countries are particularly worried about the prospects of a declining trade flow across the border.

“Britain and G-8 has endorsed India’s position and this would play a major role in negating any adverse affect on the economy”, he said.

There are also definite signs of the turnaround of the economy and the indicators on most of the sectors are very positive.

“In spite of the Kargil crisis and political scenario, the fundamentals of the economy are very strong. The Sensex is not dipping and foreign exchange reserves are quite comfortable”, Mr Khanna pointed out adding that a normal monsoon has been forecast which augurs well for the agriculture sector.

The boosters provided in the last Union Budget also appears to have started to elicit positive results as is evident from excise and customs and direct tax collections.

“Things will definitely look up after the new government comes”, he said.

Mr Khanna, however, said that the small and medium enterprises need to be given adequate attention “as these enterprises form the backbone of our economy”.

FDI flows to developing countries fall

NEW DELHI, June 27 (UNI) — Foreign Direct Investment flows to developing countries as a whole, declined by 4 per cent in 1998 over the previous year, preliminary data by the United Nations Conference on Trade and Development (UNCTAD) shows.

Developing countries received only $ 165 billion last year against $ 172 billion in 1997.

This decline — the first since 1985 — was largely caused by lower flows to South, East and South East Asia.

Contrary to this tendency, world foreign direct investment inflows increased by 39 per cent over the previous year, to $ 644 billion. The increase was due largely to a substantial step up in cross-border mergers and acquisitions (M&As) among developed country firms.

This reflects the trend of concentration of economic power in industrialised countries. The more or less historic trend of FDI flows to developed countries is retained. It also shows that despite the more hospitable climate created by many recipient developing countries they have failed to get larger FDI inflows. Creating fresh capacity by setting up new plants directly helps growth. Alternatively, M and A’s lead more to economic concentration, with contribution to the growth process being minimal.

The FDI increase occurred against the background of a slow-down in world economic growth to two per cent in 1998 (from 3.4 per cent in 1997) and the financial crisis that hit many developing countries and the Russian Federation in 1997-98. Global FDI rose despite instability in the Russian Federation and Latin America, the decline in the value of world trade, decrease in commodity prices, a slow down in privatisation programmes, and excess capacity in industries such as automobiles, steel and petroleum-related products.

Cross-border mega deals, with transaction values of more than $ three billion, were the defining characteristic of the past year. The number of such deals reached 32, compared to 15 in 1997 and eight in 1996.

Cross-border M and As do not not necessarily require cash or new funds, as they can be based on mutual exchange of stock, nearly 90 per cent of majority-owned cross-border M and A sales (in terms of value) last year were concluded in developed countries, where this mode of entry by firms is far more important than in developing countries.

The overall value of majority-owned, international M and As amounted to $ 411 billion in 1998, nearly double the 1997 and triple the 1995 figure.

The surge in M and As is partly the result of increased competition brought about by liberalisation, and the need to consolidate business internationally.

However, economists know that the value of cross-border M and As cannot be calculated as a percentage of FDI as they are not financed by FDI alone. They can also be financed by borrowing from capital markets. Such borrowing is not reported as FDI. Moreover, the financial transaction related to M and As can be phased over several years.

The European Union strengthened its position as the largest investor as well as the largest recipient of FDI flows, while the United States remained the single largest host and home country for FDI.

In Japan, M and As boosted inflows while outflows declined significantly.

Some economists argue that the threat of international competition is weakening the welfare state. This is because governments, preoccupied with consolidating foreign-financed fiscal deficits, no longer seem to able or willing to offer protection to society as a whole. They argue that in Europe crises are manifesting themselves in the high rates of unemployment in Europe and, in the widening gap and proliferation of the working poor, in the United States.

These undesirable characteristics despite the flux of FDI inflows in such large quantities is evidence of the nature and character of the growth process underway.

Inflation falls to a 14-year low

NEW DELHI, June 27 (PTI) — Annual rate of inflation fell to a 14-year low of 3 per cent for the week ended June 12, as prices of food articles, especially fruits, continued to tumble on account of bumper production.

The sharp fall in inflation rate, based on wholesale price index (WPI), is mainly on account of a good agricultural production last year with foodgrain production expected to touch a record 203 million tonnes, Finance Ministry sources said.

Moreover, the prices of manufactured products and oil have also remained stable this year due to a slackness in demand.

The rate of increase in prices, the lowest since 2.97 per cent in November 1985, has been on the decline in the past few months due to a fall in prices of agricultural products.

During the week under review, the inflation rate fell by 0.53 percentage points to 3 per cent (provisional) compared to 3.53 per cent (P) in the previous week and 7.15 per cent in the corresponding week of last year.

The sources said with a normal Monsoon forecast in the current year, general price level was likely to remain stable in the coming months.

Between January and June this year, rate of increase in prices of primary food articles have come down from about 10.5 per cent to 5.28 per cent now.

Assocham moots 500 cr for fuel cells

NEW DELHI, June 27 (PTI) — The Assocham today advocated a Rs 500 crore allocation by the government for a national mission project to set up fuel cells.

“A national mission project on development of fuel cells needs to be launched and a sum of Rs 500 crore should be allocated for the fuel cell programme,” Assocham President K.P. Singh said in a note to the Planning Commission.

Stressing the need for setting up of a task force to develop world class technology, Mr Singh also advocated formulation of an integrated energy policy to move away from oil dependence.

He has also mooted creation of a technology mission to make effective utilisation of coal.

“The proposed oil policy should take into consideration the overall resource position. In this context, utilisation of coal reserves is extremely important,” he said.

“Therefore, a coal bed methane potential of almost 1030 billion cubic metres needs to be exploited,” Singh said.

On the issue of natural gas, he said this was fast emerging as an important source of energy. “It will in fact be the fuel of the 21st century as it is cleaner, more efficient and economically versatile than fossil fuels,” the Assocham President said.

The current shortfall in demand and supply of natural gas is 100 billion cubic metres, Singh said.

“Therefore, intensive efforts should be made to step up exploration of natural gas, creation of suitable infrastructure for distribution of gas to other parts of the country and updating of the conceptual national gas grid plan prepared by Oil and Natural Gas Commission (ONGC),” he said.

“There is need to create an interpreted upstream and downstream oil company to face the competition from oil majors,” he said.

Also, there should be better coordination between the organisations under the Ministry of Petroleum and Natural Gas besides encouragement of strategic alliances, Assocham President said.

FICCI for FDI in housing sector

NEW DELHI, June 27 (PTI) — The FICCI has mooted 100 per cent foreign direct investment (FDI) in housing sector with ‘adequate checks and balances’ to bridge the shortage of 20 million houses by year 2000.

“FDI which has been the major provider for infrastructure and housing development in many countries, needs to be allowed in India to provide additional capital and to bring in more advanced technologies for construction and project management,” the chamber said.

In a paper titled ‘new measures for housing’ FICCI has estimated the investment requirement to construct 20 million houses in the rural and urban areas at Rs 50,000 crore.

Stating that the Ninth Plan allocation for housing sector was very low, the chamber said apart from initiatives announced in Budget there was a need to take additional measures to boost the growth of housing sector.

“FDI should be allowed with proper check and balances so that flight of capital does not occur and it will help increase competition in the housing sector,” the chamber said.

FICCI has also demanded income tax exemptions under section 10 (23G) of the Income Tax Act on financing of projects in housing and related infrastructure development projects.

The tax exemption which is currently available only to infrastructure projects, FICCI said would make available low cost funds for the smooth development of the sector.

FICCI also said that repayments of housing loans upto Rs 5 lakh could be granted income tax rebates to provide an incentive for housing and also increase the affordability of lower and middle income groups.

More townships need to be developed to provide accommodation to the rapidly growing urban population, it also said.

“Allowing township development infrastructure status under section 80 IA will encourage the private sector, both national and foreign to invest in new township development,” FICCI said.

Calling for a reduction in stamp duty, the chamber said it would go a long way in helping regularisation of tenure and reduce the procedural problems in the functioning of housing market in urban areas.

“Lifting the time frame limit for approved housing projects from the present limit of tax holiday could be a more realistic and sustainable action towards construction of additional housing units in the country,” FICCI said.

The chamber has also demanded early amendments to the National Housing Bank Act and Non-Performing Asset (NPA) rules to facilitate speedy foreclosure laws.

New cars eat into Maruti’s share

NEW DELHI, June 27 (PTI) — Market leader Maruti’s share in the car segment declined to 70.8 per cent in May from 87.2 per cent a year ago as new entrants like Hyundai and Daewoo continued to eat up its share by improving their performances.

Despite a 23 per cent growth in sales recorded by the passenger car industry during May, Maruti Udyog Ltd’s (MUL) sales (including exports) declined marginally by 0.24 per cent to 33,680 units as against 33,762 units in May 1998.

According to the latest figures released by the Society of Indian Automobile Manufacturers (SIAM), Hyundai Motor India Ltd (HMIL) which launched its Santro models in India late last year, cornered 9.5 per cent marketshare in May.

Another new entrant Daewoo Motors India Ltd (DMIL) improved its position by capturing a marketshare of 4.7 per cent during the month as against 2.3 per cent a year ago.

Telco, which had a marketshare of only 0.6 per cent in May last year, grabbed 5.1 per cent share in May this year mainly due to growing popularity of its small car “Indica’’ launched in December last.

Other players such as Hindustan Motors and Ind Auto also saw their marketshare going up in May this year.

Maruti’s marketshare was 74.5 per cent in April this year which slipped further to 70.8 per cent in May. Out of the total 47,578 cars sold by all passenger car manufacturers in May, Maruti vehicles alone accounted for 33,680 units.

The month of May also witnessed a decline in marketshare of luxury car producers Ford India Ltd and Honda Siel Cars India Ltd as their share slipped to 0.4 per cent and 1.5 per cent from 0.8 per cent and 2.2 per cent respectively a year ago.

Premier Automobiles was the worst sufferer as its share shrunk to 0.03 per cent in May from 0.8 per cent in the same month last year.

Marketshare of General Motors Ltd, Indian susbsidiary of US auto giant General Motors, also declined to 0.4 per cent in May from 0.9 per cent a year ago.

Hindustan Motors’ share increased marginally to 3.8 per cent from 3.3 per cent as the company sold 1819 units in May this year as against 1282 units in the same month last year.

Ind Auto improved its position by cornering 3.4 per cent marketshare during the review period as against 1 per cent in May last year.

Why impose ST in clandestine way
From P.D. Sharma

PUNJAB’S industry is in terrible fix. On one hand it is being subjected to great harassment of unimaginable magnitude by various State Government departments. On the other hand country is facing a great challenge. Elections are also on the horizon. Due to this situation morals do not permit the business community to start agitations which is the only mode to move the government. At this juncture business community should be given easier ground to work so that it can contribute to the nation’s kitty apart from the routine revenue. Senior bureaucrats of proven integrity have a delusion that this attribute goes down the stream. Their notion that their successors will also possess similar attributes is another delusion. Top bureaucrat in the Excise and Taxation department can be an apt case for this. Some of the most burning issues can be enlisted like this.

Punjab government had proposed the levy of sales tax on first stage on auto-parts, ball bearings and paints etc. On the face of protest the government declared publicly that proposal had been kept in abeyance. But in a most clandestine way it enforced the provision without announcement. Should this be the government working? This proposal is not workable in Pubjab as bulk of these goods either go out of Pubjab or come from out-side. Many manufacturers have to purchase components or ingredients both from traders and manufacturers to complete the finished product. Sales Tax on first stage means only additional cost which shall surely make the product uncompetitive. This proposal is a sure recipe to wipe out the notified industry and shall weaken the already beleaguered industry as a whole.

The Government has proposed some draft rules vide notification dated, June 7, 1999. These shall make the already complicated working more complex. If a manufacturer purchases ingredient or component from another manufacturer it does not attract sales tax but the same purchase from trader attracts sales tax. Is it fair or workable? People have started purchasing things from Chandigarh or other places to avoid extra cost. Is it a healthy decision to promote business in Punjab?

Industrial plot holders in focal points who were allotted plots decades ago are being involved in CBI enquiry. For what fault? This is yet to be known. It is presumed that in some case before Punjab & Haryana High Court a reference came about the constructions and other activities in allotted plots. The case was referred to the CBI. The Punjab Government should have clarified the position at its own level.

The government through its industrial policies of 70’s had promised residential accommodation in the focal points. But this was never fulfilled. Entrepreneurs had to accommodate various activities with in the allotted space. Due to non availability of plots to take care of the expanding businesses entrepreneurs had to make do with in the space available in the existing plots. In view of this all constructions should be authorised and court informed accordingly.

Ludhiana Municipal Corporation had proposed sharp hikes in octroi rates in its annual Budget. On protest the Punjab Government promised to keep them in abeyance. Like sales tax these rates were enforced in a most clandestine way.

CII suggests plan for Y2K compliance

NEW DELHI, June 27 (PTI) — As adverse fallouts of the ‘Y2K problem’ are staring in the face with time running out, there is need for planned national efforts to ensure that India enters the new millennium without hassles, CII has said.

Calling for co-ordinated efforts involving industry and the government for Y2K compliance, CII said while some firms and governments have initiated steps to manage the problem, a vast majority of organisations have yet to take the Y2K problem seriously.

To attack the problem squarely, CII has suggested a national and organisational level action plan for facilitating Y2K compliance in Indian industry.

While the problems associated with the date change were real, there was a need for separating hype from reality, the Chamber said, adding Y2K problem has been blown out of proportion by some and the crux of managing the problem was to take adequate steps at the earliest.

The companies need to be transparent and should share information about steps they have taken or were taking for Y2K compliance, CII said.

This way, the Chamber said the corporate sector will be able to build public confidence as their was unnecessary panic about the status of several sectors preparedness to face Y2K problems.

The decision to grant 100 per cent deduction on Y2K-related expenditure by corporates was a welcome step but such benefits should also be extended to those who have undertaken Y2K related-expenditure at any time, not just before April 1, 1999 as provided by law now, CII said.

The Chamber said, companies should prioritise their pending compliance related work as very little time was left for them to fully solve problems.

50 pc subsidy for tea cultivation
Tribune News Service

SHIMLA, June 27 — The Himachal Government has fixed a target for production of 17.02 lakh ton of food grain during the year 1999-2000. The production targets for vegetables and potato have been fixed at 5.20 lakh ton and 1.55 lakh ton respectively.

It has announced a number of incentives and subsidies to achieve these targets.

Improved seeds, plant protection chemicals, equipment and improved agriculture implements will be supplied at 50 per cent cost to Scheduled Castes, Scheduled Tribes and poor farmers and those in identified backward areas. These inputs will be supplied to other farmers at 30 per cent subsidy. Besides transport subsidy on all kinds of decontrolled fertilisers from factory to warehouse to retail sale points on actual basis is being provided.

To encourage tea cultivation 50 per cent subsidy is being provided on chemical fertilisers, plant protection and other equipment. Under integrated foodgrain development programme, Rs 200 and Rs 400 per quintal subsidy is being provided for paddy and maize respectively. The government is also providing 50 per cent subsidy and maximum of Rs 1500 for animal operated and hand operated agriculture equipment.

During the current year 30,000 improved equipment will be distributed at 50 per cent subsidy to the farmers belonging to weaker sections. A sum of Rs 66.8 lakh has been provided for the same.

BIFR rebuffs Videocon plea in Uptron case

NEW DELHI, June 27 (UNI) — The Board for Industrial and Financial Reconstruction (BIFR) has brushed aside the plea of Videocon International Limited (VIL) to participate in the revival of the sick Uptron Colour Picture Tubes Limited (now known as BPL Display Devices Limited BDDL) following non-fulfilment of its obligations.

Dismissing VIL’s plea, the Bench comprising members Mr N R Banerji and Mr G. Narayanan concluded that VIL failed to comply with its obligations as laid down in the sanctioned revival scheme within the time prescribed.

Hence, the Bench said it would not interefere, at this stage, on the prayer of VIL to invest Rs 7.5 crore in equity in BDDL nor to appoint two directors of VIL in the Board of Directors of the sick company.

The board said, “it is incumbent on each and every party to comply on its accord all the obligations cast on them in terms of sanctioned scheme i.e. where any party (in this case VIL) was indicated to take equity should have brought the funds without waiting for any letter, intimation or demand from UCPTL or BPL etc.”

Endorsing BPL’s stand that it was not obligatory on its part to remind VIL to play its role as laid down in the sanctioned scheme, the Board said the scheme did not cast any specific duty or responsibility on the company (BDDL) or BPL or any other party to be the instrument for ensuring follow up of such subscription or demand or allotment.

Though VIL has now denied that it is considering any kind of strategic tie-up with BPL in formulating a revival package for the sick BDDL, it pleaded for just the opposite in a review hearing of BIFR recently.

Bisleri targets 500 cr sales

NEW DELHI, June 27 (PTI) — Bisleri is targeting to double its sales from Rs 250 crore in current year to Rs 500 crore by next year, a top company official has said.

“By 2000, we will achieve sales worth Rs 500 crore and in the next five years we hope to cross sales of Rs 1000 crore”, Chairman of Acqua Bisleri Pvt Ltd (ABL) Ramesh J Chauhan told PTI here.

The company is also planning to strengthen its position in the rapidly growing mineral water market augmenting capacity by setting up new units.

“There is no need for diversification when you can do a good job by concentrating on a single product”, Chauhan said.

Bisleri has introduced its product in several segments like 500 ml, one litre, two litres, five litres, twenty litres and 300 litres.

3 cos restrained from using ‘Ceat’ brand

NEW DELHI, June 27 (PTI) — The Delhi High Court has restrained three companies manufacturing and selling tyres and tubes from using the “Ceat” brand name and appointed local commissioners to take into custody the offending goods.

Acting on a petition filed by Ceat Ltd, Justice M.S.A. Sidiqui said the use of word “Ceat”, logo “Rhino” and slogan “born tough” by Bestyear Rubber Industries, Dashmesh Rubber Industries and Gobind Rubber Industries amounted to infringement of the petitioner’s trade mark.

Ceat counsel Man Mohan Singh submitted before the court that the respondent companies were trying to pass off their inferior quality goods as those of Ceat Ltd and sought appointment of local commissioners to seize the offending goods.

by K.R. Wadhwaney
Let airlines take own decisions

TECHNICAL details of aircraft machinery are as sophisticated and intricate as instruments and equipment needed for heart surgery. In the event of faulty surgical equipment, a few patients may suffer. But in the case of a wrong choice of aircraft, many may perish in one crash.

The buying of aircraft should be the responsibility of pilots and engineers, as buying of medical equipment is the prerogative of doctors, surgeons and experts.

If purchase of aircraft is entrusted to little knowing bureaucrats, the landing will not be smooth. So the decision for the purchase of aircraft should be left to the pilots and engineers.

A quantum of foreign exchange is required for buying aircraft for two national carriers which, if left alone to take their own guards, will be able to fly smoothly. But there are kick-backs and more involved resulting in the aviation industry and airlines suffering in bargain.

The inaccessible regions of North-East must be catered to with utmost zeal and enthusiasm. But the care-taking government should not take any decision in haste only to regret after the elections.

The survey shows that every minister has hummed his own tune. While singing his own song, he has shown utter disregard in implementing decisions taken by his predecessor. This has, sadly, been the scenario during the last decade or about. The result is that the aviation industry takes one step forward and two steps backward. No wonder Indian aviation industry and airlines continue to suffer from the enormous impact of foreign carriers.

Two national carriers are two “airline arms” of the government. Why cannot officialdom of these two carriers be left alone to decide on flying international routes instead of ministry needlessly interfering.

What is wrong if Air India diverts its fleet to operating flights to more profitable routes than flying to Germany (Frankfurt) and South Africa (Johannesburg)? A number of foreign carriers have stopped operating through this country because of low returns. Their decision is based merely because of commercial considerations. Their respective governments have not questioned these airlines as to why they have discontinued operations through India.

Similarly, two national carriers should be left alone to safeguard their interests instead of criticising them. This leads to demoralisation and foreign operators and private carriers make a capital out of it.

by Ashok Kumar

Q: Is it worth considering an investment in the shares of Gestetner (India)?

— Luv Lakhanpal, Solan

Ans: A 51 per cent subsidiary of Gestetner, UK, Gestetner (India) Ltd (GIL) is atop the ladder in the duplicators segment, boasting of a market share of 70 per cent. The parent has the distinction of being a leader in the global market. Prior to 1994-95, the company’s performance was far from satisfactory. However, fortunes took a turn for the better after an increase in the equity stake by the parent and the launch of new and upgraded products. Since then, the company has started performing exceptionally well. Financially, the company has been registering satisfactory results. The acquisition of the parent company by the Japanese giant, Ricoh (a Fortune-500 company), could prove beneficial to GIL, as Ricoh is a larger and more profitable group.In February 1997, the company launched new models of copy printers. Now that the parent is Ricoh, GIL, can take advantage of the former’s technology expertise and can introduce models of superior quality. All signs point toward excellent growth in the future. Thus, discerning investors could consider investing in this scrip.

Q: Would you recommend holding or selling the shares of Kalpataru Power Transmission?

— Shamsher Singh, Bathinda

Ans: A prominent player in the power transmission industry, Kalpataru Power Transmission Ltd (KPTL) which presently has a capacity of 54000 TPA, now plans to commence activities in the construction business with investments in land development. On the financial front, the company’s track record has hitherto been satisfactory. The company recently bagged a contract for the construction of a 400 KV transmission system for the Vindhyachal Power Project. The entry of foreign players in the domestic arena, has rendered the industry highly competition intensive and could affect smaller players adversely. Yet, in view of KPTL’s track record and fundamental strength, its long term prospects appear satisfactory considering which one could hold on to this scrip.

Q: Kindly comment on the prospects of Ballarpur Industries?

— Vicky Dev, Chandigarh

Ans: Although Ballarpur Industries, which is the largest player in the domestic paper industry has been experiencing tough times on account of the problematic scenario prevalent in its segment, it has the potential to bounce back. The company is setting up a new pulp mill with a capacity of 150 tonnes per day to produce pulp of international quality, and also going in for a major paper machine along with upgradation of paper finishing facility. It has signed an MoU with Ahlstrom Paper Group, OY, Finland, for transfer of technology to manufacture speciality products like automotive filter papers, cores and core boards etc. It has also initiated R&D projects to develop high yielding pulpwood trees through clonal technology, to boost the production of plantations. Its performance for the year is expected to be better and it being a net foreign exchange earner, the depreciation of the rupee will enhance its revenues. At the same time, its being less dependent on import for its raw material (65 per cent of its requirements are met indigenously) would mean that its cost would not go up much. Those with a long term perspective could watch this scrip closely.

Q: How would you rate the prospects of BFL Software?

— Neel Gajjar, Shimla

Ans: BFL Software has set up a dedicated development centre in collaboration with Lanier Worldwide Inc. of the USA. The centre, located in Bangalore will focus on developing technology solutions for the healthcare industry with an emphasis on process improvement for the DOCutivity family of products marketed by the Lanier Healthcare division. It also has a dedicated centre for All-Data Corporation of the US in Bangalore. The company has shifted its operations to Bangalore from Calcutta, and are currently operating from five locations in this city. In 1995, the company acquired ISO 9001 by BVQI of UK and has been re-certified later on. It has now taken the initiative of moving toward the internationally acceptable quality standards of Capability Maturity Model level 4 to of the Software Engineering Institute (SEI) of Carnegie Mellon University. This is surely, another move in the right direction. Overall, the prospects of this company seem quite bright.

Q: Is there any improvement in the prospects of Can Fin Homes, of which I am a shareholder?

— Karl Datur, Chandigarh

Ans: Can Fin Homes, as the name itself suggests is a Housing Finance Company sponsored by Canara Bank and co-promoted by HDFC and UTI. Like many others, Can Fin Homes has also been affected by the slump in the market. Unlike LIC Housing, Can Fin seems more independent in terms of sourcing its funds. NHB refinance and the company’s own funds. With average cost estimated at about 14 per cent, the company seems to be operating on a spread of 1.5 per cent. The company is understood to be now focusing on line to credit to employers and corporates where recovery is easy and workoad less. The company operates through fully computerised 34 service locations. Loans are offered to individuals for various purposes like construction, purchase, renovation, repairs and extension of a house. Corporates can also avail the line of credit facility and rental housing scheme. The prospects of this company appear to be improving.

FII panic

UNLIKE our domestic financial institutions and market operators who are secure in the knowledge that the Pakistan army’s bark is worse than its bite and that our armed forces will retrieve the situation within the shortest possible time, the FIIs seem nervous about their recent additional exposure to the Indian markets. Little wonder then that the Sensex has begun slipping! Time to buy, is it?

ABCL

An erstwhile superstar of the silver screen was made to believe that his name alone had immense brand value in the Indian market and that when his company forayed into the capital market, a hefty premium would be his for the asking? Alas, see what the erstwhile superstar has been reduced to. As for ABCL, the less said the better. But what about the high profile merchant banker who had played up to the erstwhile superstar’s ego. There are no prizes for guessing that he is averse to getting into any conversation involving ABCL.

Sri Adhikari Bros

For those who missed the ‘Zee Telefilms’ party at the bourses when its share-price skyrocketed from a modest Rs 150 to a not so modest Rs 1500, an industry expert has a suggestion. Board the Sri Adhikari Brothers bandwagon, he advises. Join the party?

ICICI

ICICI’S new office in Mumbai at the Bandra-Kurla complex is probably the best office premises in the whole of India. However, there are marketmen who are desirous of knowing the costs involved and whether ICICI considers the expenditure productive enough. Perhaps, the excellent work environment will compensate the expenditure and justify its cost effectiveness. Again, perhaps!

Sensex upswing

The grapevine has it from the BSE bigwigs that the Sensex will tough an all time high, which is 5600 points plus by Divali this year. The rationale? Well, even a war like scenario has not dampened the market sentiment which has turned distinctly bullish, and so imagine what will happen in better times. Amen!

‘Brand-equity’

Taking the cue from the MNCs who have built solid brand names and ruled the roost in the vast Indian market, some of the Indian companies too seem ready to follow suit and have succeeded in building their own brand-equity. Little wonder then that Marico, Pidilite and Dabur rank in the same rung as some of the MNCs.

Indian Oil
NEW DELHI, June 27 (UNI) — The Indian Oil Corporation (IOC) has taken up an ambitious Rs 1467.30 crore expansion-cum-modernisation programme for its Haldia Refinery complex in West Bengal.

Essar
MUMBAI, June 27 (PTI) — Financial Institutions (FIs) are likely to look into the “conditionalities and terms mentioned in the memorandum of understanding” reached between the Essar Group and the US-based Marathon Power following the sale of Essar Group’s 515 MW Hazira power plant.

Shoe fair
NEW DELHI, June 27 (PTI) — About 170 exhibitors, comprising India’s leading international shoe and shoe component exporters and manufacturers, will take part in the four-day International Shoe Fair ‘99 to be held here from July 1.

Archies
NEW DELHI, June 27 (PTI) — Archies Greetings and Gifts Ltd will shortly launch sunglasses under Archies brand name as part of its brand extension exercise.