|Thursday, April 20, 2000,
Punwire may land PSIDC in trouble
Stanchart lost 280 crore in scam
Polaris, HCL Info profits up spurt
Reliance pact with Hong Kong firm
Airport fee hike likely
Panel on fake notes
Abolish C Form
Punwire may land PSIDC in trouble
CHANDIGARH, April 19 Punwire was once touted as a success story. The company making wireless sets and other gadgetry saw its share price touch Rs 480 in 1995. Thanks to a corrupt and adventurous management, its share has now been delisted. It is only a laughing stock at the exchanges.
And, the real danger right now is that it would also get into a deep quagmire, its promoter, the PSIDC, which has a 42 per cent stake, and the Punjab Government which has stood guarantee for a Rs 50 crore bond issue.
Punwires liability according to documents with The Tribune is Rs 400 crore and its assets are just worth Rs 70 to 80 crore. Anyone who tries to save Punwire on the golden plea that it has bagged defence orders worth Rs 75.90 crore will come to grief, a senior Punjab Government officer admitted. The repayment of Rs 50 crore loan by the Punwire to the PSIDC seems doubtful. The entire burden of redemption of bonds along with the interest would fall on the PSIDC. Its own financial health is precarious.... the State Government must undertake to reimburse this amount if Punwire does not pay, wrote Mr S.S. Brar, Managing Director of the PSIDC on March 10 this year.
While Mr Brar maintained that to sanction the guarantee for the bonds worth Rs 50 crore the board would meet under the chairmanship of the Chief Minister on April 28, the government issued orders on April 17 saying the Governor is pleased to sanction for standing irrevocable and unconditional guarantee of the State Government for Rs 50 crore bonds at Rs 12.4 per cent interest rate to be raised through two private financers. A sum of Rs 1 crore is urgently required to run this arrangement.
The PSIDC has already sunk Rs 55 crore for which there is no hope, and to make matters worse for the PSIDC, the government in order to clear the salary of its employees had withdrawn Rs 50 crore from this prime industrial development corporation. Now it has very little face to go to the financial institutions to get the needed funds. This would be a purely unsecured loan.
Mr Gurpal Singh, Managing Director of Punwire, who set up three subsidiaries for telephony and paging services, is said to be absconding, to quote senior officers. But during the last some months, he had issued post-dated cheques worth Rs 112 crore to the private unsecured creditors, the total unsecured loan was worth Rs 133 crore. Some creditors have gone to court and some senior officers of Punwire face a grave future. They could suffer imprisonment since the cheques are bouncing.
But facts about the Punwire tell a very sad tale is nearly beyond redemption despite best efforts by the Industry Secretary, Mr Ramesh Inder Singh who is the chairman of the Punwire and Director Industries, Mr D.S.Guru.
Some harsh facts: For the last one year its production activities have come to a standstill, thus further adding to the liabilities by way of salaries to its around 2000 employees.
The ad-hoc start-up plan evolved, without carrying out any financial and corporate analysis and keeping away all professionals as also without involving any of the participating financial institutions and banks revolves around only one plea that it has defence orders. Famed institution PriceWaterhouse was asked to investigate. Its final report about the mess up is yet to come. It could show the real picture.
Defence orders of about Rs 40 crore are still valid and the remaining have become invalid.
Out of the unsecured loan of Rs 50 crore from the PSIDC, over Rs 30 crore has to be paid to certain banks and around Rs 5-10 crore has to be diverted for immediate statutory liabilities and partially meeting salary requirements of the employees of Punwire.
If Punwire goes for a
rights issue, PSIDC will be again required to risk and
put its money into the rights issue of Rs 35-40 crore.
Thus, ultimately the PSIDC will sink Rs 90 crore, besides
already having lost its irretrievable stake of Rs 40-50
crore at this point of time.
region to face SAIL jointly
CHANDIGARH, April 19 The small scale industries corporations of (SSIC) Punjab, Haryana, Chandigarh and Himachal Pradesh have decided to jointly take up with the Steel Authority of India (SAIL) the issue of drastically reducing the number of items available to the corporations.
A meeting of the Punjab Small Scale Industries and Export Corporation (PSSIEC), the Haryana State Small Industries and Export Corporation (HSSIEC) and the Chandigarh Industries and Tourism Corporation (CITCO) was held here yesterday to evolve a consensus on the issue. The Himachal Pradesh Small Scale Industries Corporation (HPSSIC) could not attend the meeting convened at a short notice. But its officers have shared the views of the other three corporations and have offered to work in close cooperation with them.
The meeting was presided over by Mrs Surjit Kaur Sandhu, M.D. of the PSSIEC.
According to informed sources, the SSI sector in the four states had been utilising iron and steel material to the tune of over three lakh tonne through the SSICs per annum for the past three years. For the current year the SSI sector in these states had posted higher demand, which should have resulted in a stepped-up supply from various steel majors, the SAIL being the single largest supplier.
However, contrary to the expectations, the SAIL has curtailed the number of items available under the memorandum of understanding to be signed with the SSICs. Now only two items have been made available to the SSICs. Even on these items the SAIL had severely curtailed rebate and other benefits. It has also imposed restrictions on the quantity to be supplied by the steel producers.
The sources say the new SAIL policy will not only adversely affect the development and growth of the SSI sector but would also hit the viability of the SSICs.
It was decided that the MDs of the four corporations would meet the Union Secretary, Steel, and the Chairman and Managing Director of SAIL to highlight the pitfalls enshrined in the new policy. The sources say since the four states are land-locked, these are heavily dependent upon the SSI sector for their industrial development.
The meeting also expressed concern at what it called the increasing bias of SAIL in favour of big traders and market operators. The already existing price structure is not very favourable to the SSI units which need the support of the SSICs. The new policy will prove further detrimental to the interests of the SSI sector. The big players will monopolise the market and squeeze the SSIs.
The sources say concern was also expressed at the meeting over the lack of transparency in working of the field officers of SAIL which did not pass on routine information like availability of material and periodic price changes to their largest customers (SSICs). The field officers, however, were quick to pass on this information to big private parties.
In a decision of
far-reaching consequences, the meeting agreed to have
uniform policy packages of raw material supplies in the
region. The corporations of the four states should work
for achieving a uniformity in prices and they should
create and wider customer base for their own long-term
lost 280 crore in scam
NEW DELHI, April 19 While dismissing the appeal of Hiten Dalal, who was involved in the securities scam, the Supreme Court has partly allowed the appeal of Standard Chartered Bank and affirmed the finding of the Special Court that the Bank had been able to prove a loss of Rs 280.80 crore. The court upheld the strictures passed on the bank by the Special Court.
Mr Justice B.N. Kirpal, delivering the judgement of the bench which included Mr Justice R.P. Sethi, held that the letter dated May 11, 1992, addressed by Hiten P. Dalal to the bank created a pledge in their favour not only of the shares and debentures worth Rs 105 crore, but also on the bonus shares, dividend and interest accrued on the pledged shares and debentures.
The court agreed with the Special Courts findings that the averment of Hiten Dalal that his signatures were forcibly taken on a blank paper and the letter contruted on the same could not be accepted as he did not examine himself or proved the same in the trial court.
In reduction of
Dalals liability to the bank, the bank was entitled
to sell the original shares, rights shares and the bonus
shares and also to retain dividend and interest accrued
on the original shares, the court held while rejecting
the plea of the counsel for Dalal that rights shares
could not be considered as pledged.
POLARIS Software Lab today reported a 154.1 per cent jump in its bottomline to Rs 37.21 crore in 1999-2000 as against Rs 14.64 crore net profit registered in the previous year. The Polaris Board of Directors also declared a 30 per cent dividend, a company statement said here. The company has also approved a stock split following which the face value of each share issued and paid up will change from Rs 10 to Rs five from May 23, 2000. said.
HCL Infosystems today reported a 15 per cent jump in the net profit at Rs 16.2 crore in the third quarter ended March 31, compared to Rs 13.98 crore in the same period last year. The companys turnover rose by 27 per cent to Rs 318.2 crore in third quarter as against Rs 251.4 crore recorded during the same period last year, a company statement said here. During the first nine months, the HCL Infosystems net profit rose by 27.67 per cent to Rs 52.84 crore from Rs 41.39 crore during the same period last year.
Gujarat Ambuja Cements net profit in the third quarter ended March 31, 2000, has shot up by 489 per cent to Rs 271 crore mainly on the back of an extraordinary income of Rs 221.69 crore on account of profit on sale of shares of Ambuja Cement Eastern Limited. The net profit in the first nine months of the year, which includes the extra ordinary income, has risen by 304 per cent to Rs 376 crore on a 7 per cent sales growth of Rs 943 crore.
Sona Koya Steering Systems has decided to pay an interim dividend of 25 per cent for 1999-2000 In 1998-99, Sona had paid a dividend of 22.5 per cent, company statement said yesterday.
Satyam Infoway today announced an agreement with US-based Broadvision Inc to help develop, adapt, sell and support personalised Internet application software. Under the agreement, Satyam becomes Broadvisions first reseller of its wide range of one-to-one software application solutions in India.
The Board of Directors of Sundaram Clayton on Wednesday recommended a 35 per cent interim dividend having registered a 43.5 per cent growth in net profit for the 1999-2000 fiscal.
Its net profit for the January-March quarter was Rs 6.07 crore, up 30.82 per cent from Rs 4.64 crore in the same quarter of the previous year.
MRF Limited has recorded a 26 per cent drop in the net profit for the October-March period to touch Rs 40.93 crore as against Rs 55.72 crore a year earlier. Its sales were Rs 1,118.67 crore during the six-month period, up 1.5 per cent from Rs 1,101.07 crore a year ago.
M&M, CitiBank pact
Mahindra & Mahindra
has tied up with CitiBank for a channel financing
agreement for its dealers. CitiBank has agreed to take an
exposure of Rs 125 crore on a revolving basis and the
facility will be over and above the existing banking
facilities being enjoyed by dealers. M&M said in a
statement here today. agencies
NEW DELHI, April 19 (PTI) Reliance Power Ltd today signed an agreement with Hong Kong-based Consolidated Electric Power Asia Ltd (CEPA), to jointly develop the 3960 mw coal-based thermal power project at Hirma in Orissa.
The pit-head, coal fired 6x660 mw thermal power plant will be commissioned within 51 months of the financial closure with first of the six units becoming operational within 36 months, a company statement said here.
The remaining five units will achieve commercial operation in intervals of three months while the entire plan will start commercial operation within 51 months of the financial closure.
CEPA signed an MoU in September, 1994, with the Power Grid Corporation of India Ltd to develop the project which would source more than 19 million tonnes coal requirements per annum from Ib Valley.
Electricity generated from the station will be sold to the Power Trading Corporation, which in turn will sell it to Madhya Pradesh, Gujarat, Rajasthan, Punjab and Haryana.
The Ministry of Power
and the Power Trading Corporation are reviewing the Power
Purchase Agreement and payment security structure while
tariff approval from the Central Electricity Regulatory
Commission was awaited.
NEW DELHI, April 19 (UNI) Civil Aviation Minister Sharad Yadav has said there is a move to increase passenger service fee at airports around the country because of increased security expenses.
Inaugurating a three-day seminar on safety and security at airports, organised by the Airports Authority of India (AAI), Mr Yadav said the decision to deploy Central Industrial Security Force at almost all domestic airports had resulted in an additional financial burden on AAI.
The Cabinet Committee on Disinvestment will take up tomorrow the issue of offloading the government stake in Air India, Civil Aviation Secretary Ravindra Gupta said here.
NEW DELHI, April 19 (PTI) The Government has appointed a high-level committee to look into the circulation of fake currency notes. The committee includes representatives from the Finance Ministry, RBI, the Home Ministry and the National Security Council Secretariat to investigate the entire issue pertaining to the security dimension of the Indian currency.
In addition, a currency
and coinage division of RBI has also set up a six-member
fact-finding committee comprising experts on note
printing and currency paper for examining the fake notes
seized in the past and take remedial steps, sources said.
LUDHIANA, April 19 The green industry (hosiery garments and knitting) needs to be freed from the clutches of the Pollution Control Board, the compulsion of C Form as well as the imposition of sales tax at first stage, demanded the Readymade Hosiery Manufacturers Association of Ludhiana here today.
Mr Nar Bhushan, General
Secretary, said at a press conference that though the
State and the Central Governments had declared the green
industry as environment-friendly, the department
concerned was taking time for giving clearance to the
unit for expansion and enhancement of electricity
load.The Readymade Hosiery Manufactures Association will
organise its 4th annual award presentation ceremony here
on April 22 and confer the Great Son of
Ludhiana award on Mr Rakesh Bharti Mittal, Managing
Director of Bharti Telecom, and the Udyog
Ratan award on Mr Ram Kumar Jain, Chairman, Shraman
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