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B U S I N E S S | ![]() Sunday, October 3, 1999 |
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Graduate from textile to garment
exports: Oswal LUDHIANA, Oct 2 Mr S.P. Oswal, a leading textiles industrialist of the country and chairman of Texcon 99, has emphasised that India must graduate from textiles to garments exports if it wants to survive and claim a significant share of the world trade in this commodity in the next millennium. MTNL launches mobile services in Delhi, Mumbai NEW DELHI, Oct 2 Mahanagar Telephone Nigam Limited today launched its mobile phone services based on wireless in local loop technology in Delhi and Mumbai after having achieved necessary clearances from the Government. Pak floats bonds to raise $ 2.8 bn ISLAMABAD, Oct 2 The Pakistani Government expects to net $2.8 billion (Rs. 150 billion) from six new high value prize bonds that have been put up for sale from today. |
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ST laws need amendments in Haryana Maruti bags gold trophy for export
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Graduate
from textile to garment exports: Oswal LUDHIANA, Oct 2 Mr S.P. Oswal, a leading textiles industrialist of the country and chairman of Texcon 99, has emphasised that India must graduate from textiles to garments exports if it wants to survive and claim a significant share of the world trade in this commodity in the next millennium. Garments have overtaken textiles exports all over the world, he noted in talk with TNS as also during a presentation on the proposed international exhibition on textile technology to be held at Chandigarh from December 2 to 6. In India, it is still the textiles industry which was dominating the exports. We will therefore have to give a big push in the direction of garments exports. In this connection, he mentioned that China had made rapid progress in exports. In the 1960s, Chinas exports constituted only 4 per cent of the world trade while that of India constituted 2.2 per cent Today, Indias exports stood at only 3 per cent while that of China had climbed to 12 per cent. Potential for future of the clothing industry was tremendous. The total world trade in garments today stood at US$ 170 billion. It would rise to US$ 400 billion by the year 2010. Two-thirds of the worlds textiles at present came from the USA and European Union. But in the near future, garments business would be shifting to countries like China, India, Malaysia, Thailand, Sri Lanka etc. If India could grab even 7 per cent of the market, it would translate into annual export earnings of US$ 28 billion from garments alone. In order to make a dent in the world market, the Indian textile industry must come together and work out a strategy for the new millennium. With this end in view, a five-day mega event titled Textech 99 International Exhibition on Textile Technology is being organised at Chandigarh from December 2 to 6 under the auspices of the CII (northern region). It will be inaugurated by the Union Minister for Textile. Spread over an area of 16,000 sqm, Textech99 has been designed as technology show window for the entire textile industry. Spinning machines and accessories for cotton, synthetic, woollen and worsted, yarn processing machines; weaving preparatory machines and looms; knitting lace, braiding and netting machines; fabric processing, synthetic fibre and filament manufacturing machines etc form part of the exhibition scope. Over 150 international and domestic exhibitors have already confirmed their participation. The highlight of the exhibition will be a three-day international conference on textile and clothing titled Texcon 99. The speakers include a galaxy of international experts from Japan, Brazil, Germany, US, Hong Kong, Italy, Bangladesh and Sri Lanka. Besides Mr Shyamal Ghosh, Secretary, Textile, Government of India, Mr G.P. Gupta, Chairman and Managing Director, IDBI and Mr Narasimhan, Chairman and Managing Director, IFCI, will also speak. Woolex 99
an exclusive exhibition on wool and winter wear
will also be held concurrently for the benefit of the
public at large. A unique fashion show is also being put
together by a fashion academy of New Delhi. According to
Mr Piyush Bahl, Senior Director, CII, the northern region
has attracted a fair amount of investment in the textile
sector during the past few years and it is, therefore,
appropriate that this convention is being held in
Chandigarh.
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MTNL
launches mobile services in Delhi, Mumbai NEW DELHI, Oct 2 Mahanagar Telephone Nigam Limited (MTNL) today launched its mobile phone services based on wireless in local loop (WLL) technology in Delhi and Mumbai after having achieved necessary clearances from the Government. The MTNL mobile phone entails a monthly rental of Rs 600 ( Rs 475 from November 1), a tariff of Rs 1.40 for a three minute call. All incoming calls are free and the user will have to give Rs 10,000 as refundable security deposit for the handset. Private cellular operators, however, have criticised the move to allow MTNL to provide mobile services and sought MTNL like conditions. The Government has refuted the charges that the licence provided to MTNL does not provide a level playing field to other service providers and said that MTNL, like any other operator, had the freedom of choice of technology. As specifically provided in National Telecom Policy 99, any cellular mobile service provider (CMSP) can provide any type of network equipment. The Government has also clarified that MTNL will maintain separate accounts and other necessary documentation for its cellular services operations and said that MTNLs entry will be allowed under conditions to similar to those of private cellular operators.Currently , cellular operators are required to share 15 per cent of their annual gross revenues. Interconnect revenue sharing arrangement for cellular services for payment of access charges between DoT and MTNL for STD and ISD traffic will be same as applicable to the other private operators, the Government statement said. Meanwhile, the Delhi Science Forum (DSF) has criticised campaign launched by the Cellular Operators Association of India (COAI) against allowing MTNL to provide cheap cellular services in Delhi and Mumbai. The DSF said that while cellular operators have claimed the capital costs to be Rs 80,000 per line, MTNL has shown that the capital cost per line in cellular services is only Rs 20,000 and therefore comparable to the cost of providing basic services. With both the government and (TRAI) accepting these claims at face value,the TRAI has accepted these costs to set tariff of Rs 4 per unit for airtime along high rentals. Stating that by acceding
to COAIs arguments against MTNLs entry
repeatedly, the DSF said that TRAI is only continuing a
duopoly regime and not helping competition. The
Calling Party Pays (CPP) regime will see the low end
basic service subscriber subsidise the high-end cellular
users, the DSF added.
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Pak floats
bonds to raise $ 2.8 bn ISLAMABAD, Oct 2 The Pakistani Government expects to net $2.8 billion (Rs. 150 billion) from six new high value prize bonds that have been put up for sale from today. Old bonds worth Rs. 81 billion are to be taken out of circulation in a phased programme by the middle of next year and the government is hopeful that despite imposition of wealth tax, this money will be re-ploughed in the scheme. A spokesman for the Central Directorate of National Savings (CDNS) told IANS that an increase in the prize money and number of prizes still make the bonds an attractive and easy scheme. Bankers feel caution is called for. The only thing the government has to ensure is to protect the credibility of the draws and also the bonds against forgeries to avoid multi-claims and disputes, Qayyum Nisar, a retired banker who served in government-owned Habib Bank as senior vice-president, said. The CDNS spokesman said a committee headed by a deputy governor of the State Bank of Pakistan is keeping a close watch over the draw process to protect its credibility and transparency and will gauge the public reactions when the draws are assigned to the computers. Nisar noted that the CDNS has been very sensitive to public reaction to the draws during its 38 years of operation even though the transparency of the draws has not been questioned by a single investor yet. The CDNS spokesman said the new bonds are being printed on special security paper and, except for one series, will be on specially imported paper, making it difficult for forgers to duplicate the government issues. The bonds being phased out were printed on ordinary paper and, because of their success, some expert engravers had forged them. Four cases of forged Rs. 1,000 bonds had surfaced in the State Bank of Pakistan and even the Pakistan Security Printing Works of Karachi had difficulty in separating them from the genuine bonds. One of the
distinguishing features of the new bonds will be a
portrait of Pakistans founder, Mohammed Ali Jinnah,
in watermark that will be different from the one found on
currency notes, making forgery impossible, the CDNS
spokesman said. Unlike the present system where one draw
is conducted and the numbers composed are valid for all
series of the prize bonds, the CDNS will be conducting
separate draws for every block. IANS
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Gujarat attracts UK drug companies GANDHINAGAR, Oct 2 (PTI) Development of infrastructure in the health sector in Gujarat holds a major attraction for many British companies, according to John Lawnds, deputy Head-India desk in the British Government. Lawnds said the areas of particular interest to them included medical education, diagnostic centres, surgical equipments and pathology laboratories. Participating in the discussions on British collaboration in the health care system in Gujarat at a meeting held here yesterday, Lawnds said there was ample scope for middle-level British drug companies to enter into joint ventures with local entrepreneurs for manufacturing latest drugs and pharmaceuticals in Gujarat. G. Subha Rao, Principal Secretary, Industries and Mines Department, said health care was an important sector which the Gujarat Government would develop as part of industrial promotional activities. Mr K.N. Shelat,
Industries Commissioner, and Mr S.K. Nanda, Managing
Director, Gujarat State Financial Corporation, said the
healthcare sector was looking up in Gujarat, adding that
there were many incentives available to those who wanted
to invest in this area, according to an official release
here. |
ST laws
need amendments in Haryana THE recently introduced law in the form of rule 28-B to the Haryana General Sales Tax Rules, 1975, which lays down the procedure for the grant of tax exemption or deferment to the new industrial units, has virtually become the source of undue harassment to the entrepreneurs primarily because of an unreasonable condition imposed by sub-clause (VI) of clause (f) of sub-rule (2). What precisely this law requires of every unit desirous of claiming the benefit of tax exemption or deferment under Section 13-B of the Haryana General Sales Tax Act, 1973 is Permission for the change of land use from the authorities concerned for conversion of agricultural use into non-agricultural use. How to obtain this permission? Who are the authorities concerned within the meaning of this sub-clause? And what is the relevancy of this statutory requirement in the matter of the grant of incentives? Neither rule 28-B nor the authorities entrusted with the job of issuing the eligibility certificates to the eligible industrial units for the purposes of providing the intended benefits provide appropriate answers to these significant questions that naturally arise in everyones mind on perusal of the scheme formulated by the State Government. The process of adjudication of the applications for the grant of eligibility certificates in terms of this rule has practically come to a standstill throughout the State owing to non-compliance of this incompliable requirement of law. Consequently, the units whose applications are locked up in the process, which according to the dates available in the District Industrial Centres in the State are thousands in numbers, are passing through a very critical situation. Despite all this, the State Government appears to be simply maintaining silence over the issue. It is interesting to note in this context that an entrepreneur setting up a new unit in the State is required to approach the respective General Manager of the District Industries Centre twice over. Firstly, for obtaining a provisional certificate of registration to the effect that he intends to establish a unit in the State. Secondly, when the process of installation of plant and machinery etc is concluded, in order to obtain the permanent registration certificate commonly known as PMT. The requirement of obtaining Permission for change of land use from the authorities concerned is never pressed into service upto the stage issuing the permanent registration certificate. It is only when the case relating to the grant of eligibility certificate for the purpose of availing of the benefit of tax exemption or deferment comes up for consideration before the appropriate committee, namely, screening committees that the unit is called upon to bring the permission from the authorities concerned. The question then arises is if a certificate of permanent registration to the unit has been issued under the existing norms why cant the benefit of tax exemption or deferment be provided over in the absence of permission from the authorities concerned as far as change of land use is concerned? Once a unit comes to be permanently recognised by the General Manager, District Industries Centre (a competent authority), there seems to be no logic in the requirement of getting permission from the authorities concerned at a later point of time. More particularly when this requirement serves no purpose to the State except creating irrational impediment in the smooth functioning of the units? It is therefore not understandable as to how this important aspect has not so far been taken up for consideration by the State Government if it really wishes to ensure industrial growth in the State? The authorities placed at the higher position do not satisfactorily explain the relevancy of this particular condition. They why this meaningless requirement continues to exist on the statute book? It may not be out of place to mention here that representations made to the State Government on this point went unheeded which apparently is a unfair treatment to the units in the State. What is more ironic is the fact that certain appeals against rejection of claim of benefit of tax by the lower level screening committees on the ground of non-production of permission from the authorities concerned for change of land use also came up for consideration before the High Level Screening Committee which is known as the apex body. The issue arose in the context of rule 28-A (old rule 28-A) whether the units were entitled to the grant of eligibility certificate in the absence of permission from the authorities concerned. It was announced in the
open that the appeals have been allowed quashing the
condition imposed by the lower level screening committee
as to the grant of the eligibility certificate. However,
the units were taken aback when the copies of the
decisions communicated to them carried the orders to the
contrary in the sense that the appeals stood dismissed.
From these facts one hardly sees seriousness of the State
Government to promote industrialisation in Haryana. |
Maruti bags gold trophy for export NEW DELHI, Oct 2 (PTI) Maruti Udyog has been awarded the gold trophy for export performance in 1996-97 in Star Trading House Category by the Federation of Indian Export Organisations (FIEO). MUL exported 35,031 units of passenger cars in 1996-97, registering a growth of 34 per cent over its export performance in the previous year, a company release said here yesterday. Foreign exchange earnings from exports also grew by 54 per cent to touch Rs 565.1 crore in 1996-97, the highest ever export recorded by Maruti in a single year. The company has also
been granted the Golden Start Trading House status by the
Commerce Ministry. It had earlier achieved the Export
House status in 1991, the Trading House status in 1993
and the Star Trading House status in 1996. |
Hughes Software Systems Hughes Software Systems Limited (HSSL) is the first company in the capital market to issue shares through the book-building route. The offer comprises a book-building portion of 39.38 lakh shares of Rs 10 priced between Rs 480 and Rs 630 per share, besides a Fixed Price Portion of 4.37 lakh equity shares. The final rate arrived at through the book-building route will become the fixed price in the latter portion. The bids are on to be followed by the book-building exercise which is scheduled to close on October 7, 1999 and the fixed price offer which is scheduled to close on October 12, 1999. The financial track record of the group and the company in particular has been fairly impressive and given such a backdrop, there is little reason to downplay its projections. It seems quite likely that the EPS for the current financial year could be close to Rs 16 and were the markets to accord it the kind of P/E multiples that have been accorded to some of the other large software companies, the potential for a sharp price upswing cannot be ruled out especially since the Hughes MNC tag is associated with it. It is also worth nothing here that HSSL has achieved an annualised weighted average return on average net worth of close to 40 per cent over the past 3 years, which is impressive to say the least. The affiliation with the Hughes group and its usage of the Hughes brand name stands the company in good stead and will undoubtedly go a long way towards enhancing its future prospects. HSSL is well-placed to cash in on the inevitable telecom boom in India. Again, it is worth nothing here that HSSLs unique status as a software service vendor to telecom service providers, equipment sellers and telecom consultants gives it a sharp cutting edge over most of its contemporaries in the industry. However, investors would do well to note that nearly three-fourth or 74 per cent of HSSLs revenues for the financial year 1998-99 comprised revenues from Hughes Network Systems. Now, such a client concentration does not augur very well for its potential shareholders. It will be interesting to watch as to what level this dependence will stand at the end of this financial year. Another bothersome point revolves around the potential conflict of interest between HSSL and its largest shareholder, Hughes Electronics whose subsidiary Hughes Network Systems is HSSLs major source of revenue. Like most other promoters entering the primary market, HSSLs promoters too have helped themselves to a bonus issue in the ratio of 3:2 thus skimming off some of the companys reserves. An investment in this issue could provide good returns and is hence recommended. Vintage Cards Issue
opens/closes: 30.9.99/6.10.99 This offer for sale which is being made to the investing public by Blueberry Holdings Mauritius Limited whose post-offer equity stake will stand reduced from 39 per cent to 25 per cent. Vintage Cards & Creations Ltd. (VCCL) USP is obviously the fact that it has a tie-up with Hallmark which has helped it achieve a 40 per cent market share in the premium card segment. It has also chalked up plans to foray into the other three major sub-segments in this industry, which are the lower end, institutional sales and gifts. The fact that it is really the Hallmark brand name that is prominently displayed at all its outlets could effect the company temporarily in the event that the tie-up snaps. However, Hallmarks is not known to have a propensity to snap its tie-ups and furthermore its association with VCCL obviously fits well into its scheme of things and is typical of its international modus operandi. The other two plus points as far as VCCL is concerned is its brand licensing agreement with the Walt Disney group through WD Consumer products and its agreement with the Cancer Patients Aid Association (CPAA). However, its working capital management requires a major overhaul, notwithstanding the fact that the promoters insist that the burgeoning debtors figure can be directly attributed to the extended credit period that they have offered their retailers as part of their sales promotion strategy. Of course, the fact that the promoters helped themselves to a bonus issue in the ratio of 21 shares for every 20 shares held in May, 99 enhanced its equity base resultantly lowering its EPS with retrospective effect. Given such a backdrop, it does seem that VCCL will have to exert itself to achieve its projected bottomline of Rs 5.7 for 1999-2000 which would translate into a projected EPS of approximately Rs 11. Investors with some
propensity for risk-bearing could thus invest in this
issue. |
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