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B U S I N E S S

Hindujas, too, join race to buy Hutch
New Delhi, January 4
Corporate giant Hindujas today announced their interest to acquire Hutch-Essar Ltd, joining Reliance Communications and British telecom giant Vodafone in the race for the country's fourth-largest mobile operator.

Railways throws open container business
New Delhi, January 4
Railway Minister Lalu Prasad today kept his Budget promise of permitting private container trains by giving in principle approval to 14 operators. A concession agreement signed between the Indian Railways and the 14 container operators here today has facilitated the entry of private operators in the container business.

Corus: CSN certain to outbid Tata, say reports
London, December 4
As the deadline in the bidding war for Anglo-Dutch steelmaker Corus draws near, the guessing game is gathering steam on which of the two suitors - India’s Tata Steel and Brazil’s CSN - would walk away with the prized deal.



EARLIER STORIES
 
Bollywood actress Bipasha Basu smiles at a promotional event in Mumbai on Thursday.
Bollywood actress Bipasha Basu smiles at a promotional event in Mumbai on Thursday. — Reuters

Birlas eye retail sans foreign partner
New Delhi, January 4
Corporate giant A V Birla Group, which has kicked off its retail juggernaut with the acquisition of supermarket chain Trinethra, has ruled out partnering foreign firms in its bid to be among the country's top retailers.

Another power equipment unit likely
New Delhi, January 4
Union Power Minister Sushil Kumar Shinde said today the government was considering the formation of a subsidiary of the National Hydroelectric Power Corporation (NHPC) for engineering and manufacturing equipment for the hydro power sector. In video (56k)

Use 5-digit code, orders TRAI
New Delhi, January 4
The Telecom Regulatory Authority of India (TRAI) today instructed access providers to use a five-digit code starting with 5 for allocation of short codes to their content providers.

NHPC to spend Rs 30,000 cr
New Delhi, January 4
The NHPC aims to more than double its generation capacity by the end of 2012 to 10,000 MW and has outlined a capital expenditure plan of Rs 30,000 crore for the purpose.

Hero Group to foray into electric three-wheelers

New Delhi, January 4
The $3-billion conglomerate Hero Group is making a foray into electric three-wheeler segment, expanding its core portfolio of bicycles and two-wheelers. The group is expected to partner UK-based Ultra Motor, its technical collaborator in electric bicycles and scooters, in its three-wheeler venture.



Chairman of the Ultra Motor Company, UK, Ian Woodcock (right) and Managing Director of Hero-Honda, Vijay Munjal pose on newly launched electric cycles in New Delhi on Thursday. — AFP photo
Chairman of the Ultra Motor Company, UK, Ian Woodcock (right) and Managing Director of Hero-Honda, Vijay Munjal pose on newly launched electric cycles in New Delhi on Thursday

RBI signs MoU for revamp of UCBs
Mumbai, January 4
The RBI today signed an MoU with nine state governments to chalk out a mechanism for the revamp of urban cooperative banks (UCBs), which have been plagued by poor financial health.

Textile committee cess to go
New Delhi, January 4
The Union Cabinet today gave its approval for the abolition of textile committee cess to boost the country’s export competitiveness in the international market.

Chidambaram asks investors to stay invested 
New Delhi, January 4
Allaying their fears, Finance Minister P. Chidambaram has asked investors to remain invested in stock markets which, he said, were being closely watched to prevent any undesirable movement. 

A stock broker is glued to the computer screen at the Bombay Stock Exchange on Thursday as Sensex shed 143 points after attaining a  peak of 14,060.35 points. — PTI
A stock broker is glued to the computer screen at the Bombay Stock Exchange on Thursday as Sensex shed 143 points after attaining a peak of 14,060.35 points. — PTI

Dabur launches drug for cancer
New Delhi, January 4
Dabur Pharma today launched nanoxel, a novel drug-delivery system for the widely used anti-cancer drug, paclitaxel, in Indiabeing produced with the application of nanotechnology.

Kazakhstan changes terms for oil block to OMEL
New Delhi, January 4
Kazakhstan has lowered the stake it is willing to give to ONGC-Mittal Energy Ltd (OMEL), the joint venture of ONGC and India-born billionaire Lakshmi Mittal, in the two-billion barrel Satpayev oil block.

Nicholas Piramal forays into health imaging services
Mumbai, January 4
Wellspring, the chain of pathology laboratories promoted by Nicholas Piramal India, has acquired Jankharia Imaging — a radiology and imaging centre in Mumbai.

Nod to FDI proposals worth Rs 2,791 cr
New Delhi, January 4
The government today cleared 20 FDI proposals worth Rs 2,791.72 crore with the largest inflow of Rs 2,500 crore coming in Idea Cellular Ltd.

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Hindujas, too, join race to buy Hutch

New Delhi, January 4
Corporate giant Hindujas today announced their interest to acquire Hutch-Essar Ltd, joining Reliance Communications and British telecom giant Vodafone in the race for the country's fourth-largest mobile operator.

"I have written to Hutchison Telecom asking them if they want to divest their stake in the joint venture. We have shown our interest in acquiring the stake. As a matter of policy we don't seek a stake less than 51 per cent," Hinduja TMT (HTMT) Executive Chairman Ashok Hinduja said from Mumbai.

HTMT had exited Hutch Essar by selling its 5.11 per cent stake for $450 million in June last year.

With this, Hinduja TMT is the third player after Reliance and Vodaone who have confirmed their intentions to acquire Hutchison Essar Ltd, which is being valued in a range of $15-20 billion.

"I am yet to get a response from them. As far as valuations are concerned, we had an internal valuation done recently and when we get a response from them, we will place our bid suitably valued," he said, adding decisions regarding the time-frame, bidding process and merchant bankers would be taken only after a reply from the Hong Kong-based firm.

He did not disclose the valuation Hinduja had pegged, but said it would not be less than the base valuation Hutchison officials have stated in public.

"Funding is not an issue. We have funds and will only disclose on our tie-ups once the response from HTIL comes," he added.

When HTMT sold its stake, Hutchison Essar was valued at around $9.6 billion, but since then the valuation is reported to have nearly doubled.

Mr Hinduja also admitted that in transactions like these, there was always a premium to the market or intrinsic value.

Hong Kong-based Hutchison Telecom International Ltd controls 67 per cent stake in Hutch Essar, while 33 per cent is controlled by India's Essar, a steel-to-shipping group controlled by the Ruia family.

Essar is also reported to be in talks with HTIL, but is yet to confirm it. It has also yet to take a decision on whether to sell its own stake, buy HTIL's stake or stay put in the joint venture telecom firm.— PTI

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Vodafone officials meet DoT Secy

Amid the ongoing tussle to acquire Hutch-Essar, British telecom giant Vodafone's representatives today held talks with senior government officials on the latest position on FDI norms in the telecom sector.

Senior Vodafone officials met Telecom Secretary Dinesh Mathur and made a presentation about the company's plans in the country, official sources said, but denied that issues related to acquisition of Hutch-Essar were discussed.

Vodafone, which has about 10 per cent stake in the country's top mobile operator Bharti Airtel, wanted to know the latest position of the government on foreign investment.

"The topic of Hutch-Essar was not even touched... they enquired about the recently announced Vision statement of the ministry and wanted to know what is the strategy of implementation," the sources said.

However, the meeting assumes significance in the backdrop of Vodafone's interest in acquiring India's fourth-largest mobile firm Hutch-Essar and the delay in finalising the FDI guidelines that will clarify the status of foreign players.

 

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Railways throws open container business
Tribune News Service

New Delhi, January 4
Railway Minister Lalu Prasad today kept his Budget promise of permitting private container trains by giving in principle approval to 14 operators. A concession agreement signed between the Indian Railways and the 14 container operators here today has facilitated the entry of private operators in the container business.

The agreement was signed at Rail Bhawan today in the presence of Railway Minister Lalu Prasad, Finance Minister P. Chidambaram and Deputy Chairman, Planning Commission, Montek Singh Ahluwalia.

The Container Corporation of India is among the 14 private container operators. The new players in the container transport business include Central Warehousing Corporation, Pipapavav Railway Corporation Limited, Reliance Infrastructure Engineers Limited and Container Rail Road Services Private Limited.

After giving a green signal to the 14 private operators, the ministry has invited fresh applications for container transport buisness from private operators with a background of container, logistics and transport business.

Railway Minister Lalu Prasad said every business entails risk, the concession agreement spells out the mutual rights and responsibilites to help operators take bank loans without any difficulty. He said the operators would invest Rs 400 crore for manufacturing more than 200 wagons.

He expressed the hope that the inclusion of private operators in intermodal rail transport will result in substantial increase in the share of rail borne cointainer traffic which is limited to 22 per cent at present. This is likely to result in increase in growth of container traffic from the present 20 million tonnes to over 100 million tonnes at the end of the 11 five-year Plan.

Chairman Railway Board J.P. Batra told TNS that each player will get three years to start the business. He said Bothera Shipping is one of container corporations that have started operations even before the contract was signed.

He said 14 operators had applied and all of them were selected. He said the Railways has already raised Rs 400 crore by way of deposit from the operators. While a container operator who wishes to operate anuywhere in India is required to deposit a refundable amount of Rs 50 crore, an operator who operates on a limited route has to pay Rs 10 crore.

Mr Batra that the operation of the train will be with the Railways. He said that the Railways will levy haulage charges as it will operate the engines and spare its drivers and guards. 

The companies would buy containers from manufacturers, build inland container depots and find customers, while Railways would run the goods trains

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Corus: CSN certain to outbid Tata, say reports

London, December 4
As the deadline in the bidding war for Anglo-Dutch steelmaker Corus draws near, the guessing game is gathering steam on which of the two suitors - India’s Tata Steel and Brazil’s CSN - would walk away with the prized deal.

While speculation continues about Tata Steel set to hike its bid by another 10 per cent to as high as 550 pence a share, reports are also flowing in about Brazilian rival being determined to outbid whatever new offer comes for Corus

British newspaper The Independent’s business editor Jeremy Warner today wrote in a column that Ratan Tata might already have a number in his mind which is the maximum he and his advisers think Corus is worth to Tata Steel.

But, even if that number is 550 pence, it does not mean he will offer it, as he “is only too well aware, whatever he does the Brazilians are almost certain to outbid him.”

CSN Chairman Benjamin Steinbruch is determined to have Corus, almost regardless of the price, the report said.

The Independent article follows another piece by Business Week magazine’s Asia Regional Editor Brian Bremner who wrote yesterday that the Tatas are far from folding in Corus and the “cash-rich Indian steelmaker will likely up the ante against rival CSN to buy the Anglo-Dutch company.”

The Business Week article said that the bidding battle for Corus was expected to go high stakes in the coming weeks when Tata Steel was likely to raise its bid once again to outmanoeuvre its Brazilian rival.

Tata Steel and CSN have earlier bid 500 pence and 515 pence a share, respectively. The two companies must submit revised offers, if any, by January 30 after which the UK Takeover Panel may initiate an auction to decide on who will acquire Corus.

Meanwhile, The Independent report said that Corus was worth more to CSN than to Tata, strategically.

“Corus is, moreover, the only western steel company he (Steinbruch) can buy for cash, thereby remaining in the driving seat of the steel goliath that emerges,” it added.

“If Mr Tata is only going to get outbid, what’s the point in him upping the ante? Well, there’s always the satisfaction of forcing the rival to overpay,” Warner wrote in the article. — PTI

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Birlas eye retail sans foreign partner

New Delhi, January 4
Corporate giant A V Birla Group, which has kicked off its retail juggernaut with the acquisition of supermarket chain Trinethra, has ruled out partnering foreign firms in its bid to be among the country's top retailers.

The A V Birla group aims to become a leading retail player but Chairman Kumar Mangalam Birla has categorically denied any intentions to form partnership or joint ventures with any foreign firms, a top group official said.

Birla Group's decision to go alone comes contrary to other domestic companies such as Bharti Enterprises joining hands with world's largest retailer Wal-Mart.

The country's retail sector, which is being estimated at about $300 billion, continues to attract foreign players with other companies such as UK-based Tesco and French major Carrefour exploring opportunities in India. However, Reliance Industries, India's top private firm, is also going alone and has chalked out a Rs 25,000-crore retail plan.

Without disclosing any financial details of the group's retail business plans, the official said the funding would not come from any of the listed group companies.

The group would operate its retail business under the name of A V Birla Retail Ltd and plans to follow multi-format retail business model, which would consist of both large and small-sized stores.

The group has recently acquired a 90 per cent stake in Hyderabad-based Trinethra Super Retail, which operates a total of 170 stores under the Trinethra and Fabmall brands in Andhra, Tamil Nadu, Karnataka and Kerala.— PTI

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Another power equipment unit likely
Tribune News Service

New Delhi, January 4
Union Power Minister Sushil Kumar Shinde said today the government was considering the formation of a subsidiary of the National Hydroelectric Power Corporation (NHPC) for engineering and manufacturing equipment for the hydro power sector.

Addressing a seminar on ‘Hydropower: Harnessing untapped potential’ organised by FICCI, Mr Shinde said his ministry favoured the setting up of a subsidiary of the NHPC " as at present we are fighting with only one company whose manufacturing capacity was 5000 MW."

Citing the lead taken by China, he said, China was able to address the problem as it had seven companies in engineering and manufacturing of hydro power projects.

The minister said the draft note on the new hydro power policy was likely to be presented to the Cabinet in a month.

Mr Shinde sought the cooperation of all stakeholders to tackle the constraints in the commissioning of hydel projects if the power sector was to contribute to the country’s economic growth.

Currently, out of the 1,50,000 MW of hydro power potential, only 22 per cent had been tapped. "We need to step this up significantly as otherwise we will not be able to increase the per capita availability of power and sustain our rate of growth," the minister said.

Earlier, Power Secretary R.V. Shahi said the government was planning to double the hydel power capacity addition to 18,000 MW in the 11th Plan period at an estimated cost of Rs 90,000 crore.

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Use 5-digit code, orders TRAI
Tribune News Service

New Delhi, January 4
The Telecom Regulatory Authority of India (TRAI) today instructed access providers to use a five-digit code starting with 5 for allocation of short codes to their content providers.

The DoT had recently issued guidelines suggesting the use of a five-digit code starting with level 5 by access providers for the allocation of short codes to their content providers, including SMS-based services within their network. Accordingly, all existing four-digit short codes were to be prefixed by five to convert the same to five-digit codes, a press note said

Further, the existing five and six-digit short codes were to be migrated to five-digit ones by replacing the first digit or first two digits, respectively, by five.

Short codes are being used by service providers or content providers for applications, including downloading ring-tones contests, quiz, polls, information and enquiry services, entertainment, SMS, games, astrology and cricket updates.

TRAI observed that some of these short codes were not in accordance with the national numbering plan-2003 and the DoT's earlier orders on this issue. TRAI has sought compliance of the DoT guidelines by May 31.

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Hero Group to foray into electric three-wheelers

New Delhi, January 4
The $3-billion conglomerate Hero Group is making a foray into electric three-wheeler segment, expanding its core portfolio of bicycles and two-wheelers.

The group is expected to partner UK-based Ultra Motor, its technical collaborator in electric bicycles and scooters, in its three-wheeler venture. It is likely to launch the new vehicles either by the end of the year or early next year.

The group, which has so far invested about Rs 50 crore on the new facilty for electric vehicles in Ludhiana, could expand it further for the three-wheeler venture as well.

He however, declined to comment on the proposed investments.

Ultra Motor Chairman Ian Woodcock said the company has the three-wheeler technology market-ready and it could be rolled out by late this year or early 2008.

The electric two-wheelers, which would be marketed under the brand name 'Hero Electric', come at a price range of Rs 15,000-Rs 20,000 for bikes and Rs 24,000- Rs 28,000 for scooters.

Under the technical collaboration with Ultra Motors, Hero would assemble, manufacture and service the electric vehicles, whereas the former would provide the electric vehicle technology, besides providing marketing support.— PTI

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NHPC to spend Rs 30,000 cr

New Delhi, January 4
The NHPC aims to more than double its generation capacity by the end of 2012 to 10,000 MW and has outlined a capital expenditure plan of Rs 30,000 crore for the purpose.

The state-run enterprise has lined up 14 projects to augment its generation capacity during the 11th Plan. It also aims to add another 12,000 MW during the 12th Plan.

“We aim to become to a 10,000-MW company by the end of the 11th Plan from the present level of 3755 MW,” NHPC Chairman and Managing Director S.K. Garg said here today.

Of the Rs 30,000 crore, internal accruals would account for Rs 4,800 crore and the government would provide a budgetary support of Rs 6,000 crore. The company also planned to raise Rs 1,000 crore through an IPO. — PTI

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RBI signs MoU for revamp of UCBs

Mumbai, January 4
The RBI today signed an MoU with nine state governments to chalk out a mechanism for the revamp of urban cooperative banks (UCBs), which have been plagued by poor financial health.

Under the mechanism, representatives of the RBI, state governments and UCBs would sort out various issues to ensure that the parameters agreed upon in the MoU are met, RBI Governor Y.V. Reddy said today.

As many as nine state governments, including Maharashtra with about 70 per cent of the UCB concentration, have signed the MoU.

Of the UCBs in Maharashtra, only 30 per cent of the banks accounting for 25 per cent of the deposits were weak, he said adding this meant that 75 per cent of the UCB deposits of Rs 70,000 crore in the state were safe.

The main purpose of the MoU was to cleanse the UCBs and once that was done, the good UCBs would be allowed to open new branches and enter new streams of business like insurance, mutual funds, Mr Reddy said, adding that the final decision on allowing them to start new branches could be expected only after March. — PTI

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Textile committee cess to go
Tribune News Service

New Delhi, January 4
The Union Cabinet today gave its approval for the abolition of textile committee cess to boost the country’s export competitiveness in the international market.

The exemption of textiles committee cess under Section 5E of the Textiles Committee Act, 1963, will rationalise the tax burden and ''improve competitiveness of Indian readymade garment sector in global markets,'' Parliamentary Affairs Minister Priyaranjan Dasmunsi said after the Cabinet meeting.

Reacting to the Cabinet decision, the president of the Federation of Indian Export Organisation Ganesh Kumar Gupta said it would also help in removing procedural bottlenecks and thus reducing transaction cost and time.

He said the abolition of cess showed the government’s commitment to insulate exports that Indian textile industry would meet the challenge in the post multi-fibre agreement phase-out and would regain its eminent position in the country’s export basket.

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Chidambaram asks investors to stay invested 

New Delhi, January 4
Allaying their fears, Finance Minister P. Chidambaram has asked investors to remain invested in stock markets which, he said, were being closely watched to prevent any undesirable movement. “All I can say is markets will rise, markets will fall. To a long-term investor, this should not cause any worry, he should believe in India growth story and remain invested unless there are very dramatic changes in the environment,” he said in an interview to NDTV news channel.

However, he refused to give any advice to punters.

“What advice can I give to a punter? I have no advice to give to him,” he said.

Pointing out that the stock market was based on speculation, he said even if there were larger-than-expected numbers of speculators in the market, it should not cause any harm so long as there was no manipulation.

“If 100 persons are speculating on a market, one has to see the fundamental basis of the market,” he said.

Referring to the price-earning (P-E) ratio of 20-21 in the markets, Mr Chidambaram said the level was not stratospheric and depended on the people’s expectations from the market.

“Now, who am I to say the people should not expect price to be 20 times the earnings. People are willing to accept price 20 times the earnings, and that is what they were aiming at when they buy. Why should I second-guess that?” he said.

He reminded the investors that the P-E ratio rose to 35-40 during the scam period. “Nobody paid heed at that time (scam).

Today...we watch it very closely to ensure that there are no undesirable movements,” he said.—PTI 

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Dabur launches drug for cancer
Tribune News Service

New Delhi, January 4
Dabur Pharma today launched nanoxel, a novel drug-delivery system for the widely used anti-cancer drug, paclitaxel, in Indiabeing produced with the application of nanotechnology.

The price of the drug is Rs 16,000 for one cycle of chemotherapy administration. A patient would require at least five or six cycles, the company said.

'The drug will be available for the European and US markets after 18-36 months once the approval is made by the USFDA,'' Dabur Pharma Chairman Anand C. Burman said here today.

It would be made available in neighbouring countries, he said.

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Kazakhstan changes terms for oil block to OMEL

New Delhi, January 4
Kazakhstan has lowered the stake it is willing to give to ONGC-Mittal Energy Ltd (OMEL), the joint venture of ONGC and India-born billionaire Lakshmi Mittal, in the two-billion barrel Satpayev oil block.

"Kazakhstan has changed the terms of offer for the Satpayev block in the Caspian Sea. Instead of 50 per cent stake and operatorship, it is now offering only 25 per cent stake to OMEL," a source close to the development said.

Kazakhstan had in 2005 offered ONGC Videsh Ltd (OVL), the overseas arm of ONGC, 50 per cent stake and operatorship in either Satpayev or Makambet blocks. In October 2006, it wanted Mittal, who has a large steel plant in Kazakhstan, to be included and so OMEL was drafted-in instead of OVL.

Now, Kazakhstan has reduced offer to 25 per cent stake and given operatorship and majority stake in Satpayev block, which was selected by OMEL for participation, to its national oil company KazMunaiGaz.

OMEL, however, is insisting on operatorship and 50 per cent stake in the Satpayev block that is believed to hold two billion barrels of oil reserves, the source said.

Besides the delay in allotment of the block, KazMunaiGaz (KMG) has also demanded an additional bonus besides the signature bonus of about $100 million. Signature bonus is the money paid to the government on allotment of a block.

The source said KMG also wants OMEL to carry its interest in the block. "If agreed, OMEL will have to pay KMG's share of expenditure during exploration phase."— PTI

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Nicholas Piramal forays into health imaging services

Mumbai, January 4
Wellspring, the chain of pathology laboratories promoted by Nicholas Piramal India, has acquired Jankharia Imaging — a radiology and imaging centre in Mumbai.

The new entity would be renamed as Wellspring-Jankharia Imaging and would be the first corporate diagnostic provider to enter into high-end health imaging segment, a company statement from the pharma major to the BSE said.

"The Indian health imaging market is expected to double from the existing $350 million in the next five years.

Hence, we consider the acquisition to be a strategic fit into Wellspring's expansion plans," Nicholas Piramal Director, Strategic Alliance and Communication Swati Piramal said.

Wellspring would aggressively invest for the next two years during which Nicholas Piramal would offer tele-radiology solutions requiring expert radiology opinions across India and abroad. — PTI

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Nod to FDI proposals worth Rs 2,791 cr

New Delhi, January 4
The government today cleared 20 FDI proposals worth Rs 2,791.72 crore with the largest inflow of Rs 2,500 crore coming in Idea Cellular Ltd. The FDI would include maintaining and operating the company's telephone services and will increase the foreign investors stakes in the company to 74 per cent from the present 47.55 per cent.

In addition, the South Korean auto parts maker Daerim Enterprise will invest Rs 60 crore for setting up a wholly-owned venture to undertake manufacture of auto parts and other related products in Tamil Nadu.— UNI

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BRIEFLY

Bio-diesel plant
Chidambaram, January 4
A US-based biofuel company in association with Indian petroleum majors and National Chemical Laboratory (NCL), Pune, would set up the first bio-diesel pilot plant using a solid catalyst by 2008, according to a top scientist.The company, New Century Lubricants, which bagged an exclusive licence to NCLF’s patented invention “solid catalyst” in November, 2006, is expected to tie up with one of the Indian petroleum companies and start manufacturing cost-effective bio-diesel in 2008, Dr Darbha Srinivas, a scientist at Catalysis Division of NCL, said today. — PTI

Zinc price cut
New Delhi, January 4
Hindustan Zinc Limited today decreased the zinc prices by Rs 9,300 per tonne. The company decreased the zinc prices from Rs 221,500 to Rs 212,200, according to a statement by Vedanta Resources Plc, the holding company here. However, there is no change in lead prices, which remained at Rs 86,300, it added.— PTI

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