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Govt support in buyouts abroad demanded
New Delhi, January 9
India Inc today sought government support in cross-border acquisitions, a demand considered crucial at a time when the Tatas are fighting it out to acquire UK-based Corus and Videocon for Korea's Daewoo Electronics.
Business tycoon Ratan Tata and Sunil Bharti Mittal deliberate before a pre-Budget meeting with the Finance Minister in New Delhi on Tuesday.
Business tycoon Ratan Tata (right) and Sunil Bharti Mittal deliberate before a pre-Budget meeting with the Finance Minister in New Delhi on Tuesday. — PTI photo

Petro prices may be cut if crude falls below $50
New Delhi, January 9
Petrol and diesel prices may be reduced by the government if the current fall in international oil prices continues and crude declines below $50 a barrel level, Petroleum Secretary M.S. Srinivasan said today.



EARLIER STORIES

 

Ranbaxy eyes Merck’s generic biz
New Delhi, January 9
Ranbaxy Laboratories, India's largest drug firm, has said the bidding process for German drug giant Merck's generics business would begin by the end of this month.

Car loan just a swipe away
Mumbai, January 9
ICICI Bank today announced a new initiative in its car loans segment called LOTS (loan on the spot) for its existing savings account customers.

Vodafone hastens pace of Hutch deal
Unlikely to foster bid war, CEO Arun Sarin coming today
New Delhi/Mumbai, January 9
The battle for acquisition of Hutchison-Essar (HEL) is set to gather steam with UK-based Vodafone's CEO Arun Sarin arriving here tonight to hold crucial discussions with Commerce Minister Kamal Nath and HEL officials.

Indian partner must for Vodafone
New Delhi, January 9
Vodafone will have to partner with an Indian company, even if a dormant front company, if it succeeds in getting majority control of Hutch-Essar, government officials said.

New financial instruments for NRIs promised
New Delhi, January 9
Finance Minister P. Chidambaram today asked the overseas Indian to believe in the country’s growth story, and promised to come out with financial instruments for attracting their remittances for longer duration.

Jet plea for refund rejected
Mumbai, January 9
Jet Airways, which is involved in a tussle with its failed takeover target Air Sahara, today failed to get respite from an arbitration panel on its plea for refund of Rs 500 crore paid as advance.

Section of industry inflating prices, says FM
New Delhi, January 9
Blaming a section of the industry for artificially pushing up product prices, the government today asked them to refrain from such a short-term view of the booming economy as it would only harm their interest by forcing interest rates to rise.

Union Finance Minister P. Chidambaram along with outgoing Ficci President Saroj K. Poddar (left) and newly elected chief Habil Khorakiwala at the 79th AGM in New Delhi on Tuesday. — PTI photo

Union Finance Minister P. Chidambaram along with outgoing Ficci President Saroj K. Poddar (left) and newly elected chief Habil Khorakiwala at the 79th AGM in New Delhi on Tuesday.

SAT dismisses Karvy's appeal in IPO scam
Mumbai, January 9
The Securities Appellate Tribunal (SAT) has dismissed the plea made by Karvy Stock Broking Ltd against SEBI's interim order in the IPO scam where thousands of fictitious demat accounts were used to corner retail portion of shares in 21 IPOs.

Cairn to invest $1.5 b, makes weak debut
Mumbai, January 9
Unruffled by the weak debut on the bourses today, Cairn India Ltd said it would invest $1.5 billion over three years toward exploration and development activities in Rajasthan oilfields.

Honda plans small car for India
New Delhi, January 9
Japan's Honda Motor Co said today it was developing a premium hatchback, keeping in mind Indian conditions, which would be launched within two or three years.





Honda Siel President and CEO Masahiro Takedagawa at the launch of Honda "Accord V6" in New Delhi on Tuesday. — A Tribune photograph
Honda Siel President and CEO Masahiro Takedagawa at the launch of Honda "Accord V6" in New Delhi on Tuesday.

Singapore Stock Exchange eyes stake in BSE
Mumbai/Singapore, January 9
The Bombay Stock Exchange, which is currently in the process of finalising a strategic partner as per its demutualisation scheme, is in talks with Singapore's stock exchange to explore various business opportunities together.

Tap opportunities in services sector, says Satyam chief
Hyderabad, January 9
India should grab the opportunity in services sector available in the global market, Satyam Computers Chairman B Ramalinga Raju said.

TCS topples Infosys as most valued IT firm
Mumbai, January 9
Tata Consultancy Services today toppled IT major Infosys to become the country's most valued IT firm.

 

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Govt support in buyouts abroad demanded

New Delhi, January 9
India Inc today sought government support in cross-border acquisitions, a demand considered crucial at a time when the Tatas are fighting it out to acquire UK-based Corus and Videocon for Korea's Daewoo Electronics.

"We want the government to extend political, social and financial incentives while India Inc engages in acquisitions abroad," Assocham's President Anil K Aggarwal told reporters after captains of corporate India met Finance Minister P.. Chidambaram for pre-Budget deliberations.

Videocon's V. N. Dhoot, whose company is embroiled in a takeover tussle with Daewoo's creditors, said some benefits might be given to Indian companies that were in the process of going global.

"... These benefits could be in proportion to the capital investment being made by them across the world," he said.

According to sources, Tata group Chairman Ratan Tata "nodded when Mr Dhoot raised the matter with the Finance Minister."

In other major demands, the industry said corporate tax rate should be brought down to 25 per cent from 30 per cent.

Also, India Inc sought tax exemptions on research and development beyond 2007, by another 10 years. The industry said the exemptions should be extended to other industries as well, besides pharma and automobiles.

A demand was also made to "rationalise" fringe benefit tax (FBT). "FBT should not be imposed on genuine business expenditure like sales and promotions," FICCI past President Y. K. Modi said. — PTI

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Petro prices may be cut if crude falls below $50
Tribune News Service

New Delhi, January 9
Petrol and diesel prices may be reduced by the government if the current fall in international oil prices continues and crude declines below $50 a barrel level, Petroleum Secretary M.S. Srinivasan said today.

The fall in international crude prices is of much relief to us. We are closely monitoring the emerging scenario... certainly, we will consider a revision if prices fall further, he told reporters here.

In November, petrol and diesel prices were cut by Rs 2 and Rs 1 a litre, respectively, when the basket of crude that Indian refiners buy was at $56.8 per barrel. The Indian basket has since fallen to just under $53 per barrel, the lowest this fiscal.

State-run oil companies are currently incurring a loss of Rs 0.22 per litre on petrol and Rs 1.42 a litre on diesel, he said. Kerosene is being sold at a loss of Rs 13-14 per litre and domestic LPG at a loss of Rs 50 per cylinder.

IndianOil, Bharat Petroleum, Hindustan Petroleum and IBP together are losing about Rs 100 crore a day on fuel sales.

In the first half of 2006-07, the under-realisation on sale of petrol, diesel, LPG and kerosene was Rs 33,200 crore.

Separately, an oil ministry official said the ministry was seeking a shift to specific duties on fuel from the current mix of ad-valorem and specific duties.

The current excise duty on petrol is 8.16 per cent of ex-factory price plus Rs 13.26 a litre, while for diesel it is 8.16 per cent plus Rs 3.32 a litre. The ministry has suggested a specific duty of Rs 15.92 for petrol and Rs 6.08 per litre for diesel in the forthcoming Budget.

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Ranbaxy eyes Merck’s generic biz

New Delhi, January 9
Ranbaxy Laboratories, India's largest drug firm, has said the bidding process for German drug giant Merck's generics business would begin by the end of this month.

"The process for bidding is likely to start by the end of this month," Ranbaxy CEO and Managing Director Malvinder Mohan Singh said here yesterday.

Mr Malvinder Mohan Singh said he did not expect any serious competitor from India, but some global companies and private equity firms could be in the fray.

If the deal goes through, it will be the biggest overseas takeover by an Indian pharmaceutical company, leaving behind Dr Reddy's $570 million acquisition of Betapharm.

Merck is considering sale of its generic business unit in order to relieve its debt from a $13.3 billion acquisition of Swiss biotech firm Serono. — PTI

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Car loan just a swipe away

Mumbai, January 9
ICICI Bank today announced a new initiative in its car loans segment called LOTS (loan on the spot) for its existing savings account customers.

Those aspiring to purchase a car under the new initiative of the bank need to have a savings bank account with the facility of a debit card to get the pre-approved offer from the bank.

ICICI Bank General Manager and head, retail assets, Rajiv Sabharwal said :''With the boom in the country's economy, there is a sudden spurt in the demand for new cars and hence we've launched this offer to facilitate our customers to have a car.

The bank has started the initiative in a few cities, namely Mumbai, Delhi, Kolkata, Chennai, Hyderabad, Bangalore, Pune, Ahmedabad, Chandigarh and Jaipur at the moment, but would soon extend the offer to more than 20 cities.

ICICI Bank's Head of Car & Commercial Vehicle Loans N.R. Narayana said :''We have put separate swipe machines at the dealers' shops for the purpose for the time being to avoid confusion.'' However, the existing swipe machines are equipped with this facility, he added.

General Manager, Technology, of the bank Mukesh Kumar Jain said ''The EDC (electronic data capture) terminals installed at the dealers' outlets eject a printed slip which gives offer details along with a 16-digit unique number generated for the customer.

The dealer can use this pre-approved offer slip to obtain a sanction from the bank within an hour''. — UNI

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Vodafone hastens pace of Hutch deal
Unlikely to foster bid war, CEO Arun Sarin coming today

New Delhi/Mumbai, January 9
The battle for acquisition of Hutchison-Essar (HEL) is set to gather steam with UK-based Vodafone's CEO Arun Sarin arriving here tonight to hold crucial discussions with Commerce Minister Kamal Nath and HEL officials.

While Vodafone, one of the main suitors, was continuing the process of due diligence of HEL, the bankers of Indian partner Essar, too, were gearing to study HEL's books later this week.

Mr Sarin, who is expected to reach here in the early hours of Wednesday, will be meeting Mr Kamal Nath to deliberate on the FDI policy in telecom sector and other regulatory issues.

According to sources, he may also meet Mr Sunil Mittal, in whose Bharti Airtel Vodafone holds about 10 per cent stake, to sort out issues relating to 'non-compete clause'.

Mr Mittal had earlier in the day said that no investor has approached them to buyout Vodafone's stake in Bharti, adding it was too early to talk about disengagement issues.

Sources said Mr Sarin as well as his existing Indian partner Sunil Mittal are scheduled to meet Communications Minister Dayanidhi Maran separately tomorrow evening.

However, though Vodafone is hastening the pace, it is unlikely to enter a bidding war for the acquisition of India's fourth-largest cellular operator. This is aimed at allaying investors' concerns over surging valuation of Hutch-Essar.

While banking sources have indicated that an internal valuation ceiling has been given to Mr Sarin, they did not respond to queries if the target (on the enterprise value for HEL) was set at $20 billion.

When contacted, a Vodafone spokesperson said: "We have made it very clear that any transaction will be within our financial investment criteria." While Vodafone is conducting due diligence, Essar Group's bankers, are likely to start examining from tomorrow the books of Hutchison Essar Ltd in the run-up to its bid for Hutchison Telecom's 67 per cent stake in the joint venture company.

The five bankers — Citibank, Morgan Stanley, Standard Chartered, Merill Lynch and Lehman Brothers — would initiate "confirmatory diligence" for Hutch Essar Ltd in a day or two, sources familiar with the development said.

These bankers have extended funding pledges to the tune of $25 billion to Essar and would study HEL's books before actual flow of credit in case their client succeeds.

RCoM Board  meeting today

Anil Ambani group firm Reliance Communications (RCoM) is likely to finalise tomorrow a strategy, including financial details, for its intended bid to acquire Hutchison Essar Ltd.

The Board of RCoM is scheduled to meet here to consider among other things raising resources from the international market through issue of securities such as FCCBs and ECBs.

Even though the issue of acquiring Hutch-Essar was not on the agenda notified to the bourses last week, sources familiar with the matter said the company would chalk out a roadmap for the proposed takeover. This would include scrutinising the books and putting in a formal bid for HEL.

In the event of HTIL getting a top bid from RCoM, Essar would be given an opportunity to match the offer as it has the right of first refusal (RoFR) in the JV pact. — PTI

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Indian partner must for Vodafone

New Delhi, January 9
Vodafone will have to partner with an Indian company, even if a dormant front company, if it succeeds in getting majority control of Hutch-Essar, government officials said.

Senior DoT officials said under the stipulated regulations, any foreign company such as Vodafone cannot be allowed to keep 74 per cent stake and offer the balance 26 per cent to the Indian public. This is because nobody can keep track of when the Indian public sells that share to foreign investors in secondary market transactions. The Indian partner need not be a service provider in telecom, they said.

The officials said banks and financial institutional investment in telecom is treated as domestic equity while technically the public holding of 26 per cent stake can be taken as part of Indian investment.

But the problem would arise if the public started selling to foreign investors in the secondary market. This in effect could take the foreign equity over the 74 per cent ceiling, which is not allowed. — PTI 

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New financial instruments for NRIs promised
Tribune News Service

New Delhi, January 9
Finance Minister P. Chidambaram today asked the overseas Indian to believe in the country’s growth story, and promised to come out with financial instruments for attracting their remittances for longer duration.

Addressing a pravasi Bharatiya divas seminar here, he said the NRI remittances to India, on an average, were of a three-year duration, and asked them to expand their horizon to bring longer-term money for at least 10 years, as well as their expertise in various fields.

Mr Chidambaram promised NRIs that the government would bring new financial instruments and institutions to help them bring longer-term money and their knowledge base into India.

He particularly asked them to bring their expertise to put agriculture on a sustained growth path of not less than 4 per cent in a year so that fruits of growth could reach every section of society.

He said there was a sacred tie between the tiller and land. That tie can never be broken. Any attempt to snap the relationship between the tiller and the land is bound to face opposition.

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Jet plea for refund rejected

Mumbai, January 9
Jet Airways, which is involved in a tussle with its failed takeover target Air Sahara, today failed to get respite from an arbitration panel on its plea for refund of Rs 500 crore paid as advance.

Jet had sought refund of Rs 500 crore paid by it as advance to Air Sahara along with interest after a takeover deal was reached in January last year, but the arbitration Tribunal declined the plea in its hearing here, sources said.

Jet officials were not immediately available for comment. Justice S. P. Bharucha and Justice B.P. Jeevan Reddy, both retired Judges of the Supreme Court, are on the panel as nominees of Jet and Air Sahara, respectively. —PTI 

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Section of industry inflating prices, says FM

New Delhi, January 9
Blaming a section of the industry for artificially pushing up product prices, the government today asked them to refrain from such a short-term view of the booming economy as it would only harm their interest by forcing interest rates to rise.

Addressing the AGM of Ficci, Finance Minister P Chidambaram also asked the industry to look into the reasons for poor performance of certain sectors like food products, paper, leather, chemical, basic metals and machinery.

He advised industry chambers to set up a knowledge cell of outstanding experts to develop innovative ideas for the industry.

While Indian industry has got certain degree of mastery over acquiring technology, products and raising financial resources, it has yet to learn how to respond to the changing market behaviour, he said.

The Finance Minister said while contribution of primary and fuel items to inflation has declined of late, certain manufacturing items are leading to its rise.

On segments showing poor performance in the economy, he said it might be because of rise in input costs, especially in wheat, milk and sugar for food products.

He said inadequate investment is still a constraint that holds back the economy from sustaining higher growth rate.

On some industrialists' demand for swapping rupee loans with external commercial borrowings, Chidambaram said he could not allow external debt to rise beyond a point.

Meanwhile, Mr Chidambaram said a 9 per cent GDP growth rate in the current fiscal would be a reality and called for a price reduction to contain the ''worrying'' inflation.

''I am confident that the current fiscal year will end up with a growth rate of close to 9 per cent although I do not know where the decimal might fall,'' he told reporters at the Pravasi Bharatiya Divas here. — PTI

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SAT dismisses Karvy's appeal in IPO scam

Mumbai, January 9
The Securities Appellate Tribunal (SAT) has dismissed the plea made by Karvy Stock Broking Ltd against SEBI's interim order in the IPO scam where thousands of fictitious demat accounts were used to corner retail portion of shares in 21 IPOs.

SEBI, through an interim order in April last year, had barred 24 key operators, including Karvy, from participating in the markets for their alleged involvement in the IPO scam.

The regulator had barred Karvy from carrying on several of its businesses including that of depository participant (DP), share registrar and proprietory trading. Karvy had later filed an appeal in SAT.

Later, SEBI had issued a disgorgement order directing depositories NSDL and CDSL along with eight DPs, including Karvy, to cough up Rs 115.81 crore unjustly gained from the market during the IPO scam.

Out of this, Karvy has to pay Rs 40.55 crore, which again is being contested by the company in SAT. — PTI 

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Cairn to invest $1.5 b, makes weak debut

Mumbai, January 9
Unruffled by the weak debut on the bourses today, Cairn India Ltd said it would invest $1.5 billion over three years toward exploration and development activities in Rajasthan oilfields.

The shares of the company got listed at Rs 152 on the National Stock Exchange with a discount of 5 per cent over the issue price and at Rs 140 on the Bombay Stock Exchange with a discount of 12.5 per cent over its issue price of Rs 160.

Commenting on the weak start, Cairn Energy's Ceo Rahul Dhir said "the current price does not reflect the strong fundamentals of the company.

We will increase our production almost five-fold by 2010 and we have very good fields with us." Meanwhile, Mr Dhir said the company would invest another $1.5 billion in exploration and development activities in India over the next three years and $1 billion of this will go for the first phase of the Rajasthan oilfield. — PTI

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Honda plans small car for India

New Delhi, January 9
Japan's Honda Motor Co said today it was developing a premium hatchback, keeping in mind Indian conditions, which would be launched within two or three years.

"It will not be from our existing models. Our plans are to provide the latest global-technology models and this car will most likely be launched in the next 2-3 years," Mr Masahiro Takedagawa, President and CEO of Honda's Indian joint venture Honda Siel Cars India (HSCI), told PTI here.

Asked whether the car was being specially developed for the Indian market, he said, "India will be the lead country though the car will also be sold in other markets. However, we will consider Indian infrastructure and localisation plans while developing it." Honda's Global President and CEO Takeo Fukui had recently said in Tokyo that the company would launch a small car in India in the coming years as it eyed sales of 1.5 lakh units by 2010.

Honda, which sells models like sedans 'City', 'Civic' and 'Accord', is expanding capacity at its Greater Noida plant to 1,00,000 units by 2007 while the new plant in Rajasthan will have an installed production capacity of 2,50,000 units though the company plans to start with 50,000 units.

The company today unveiled an upgraded version of the luxury sedan Accord.

Available in three variants, the base version has been priced at Rs 14.92 lakh while the top-end at Rs 17.32 (both ex-showroom Delhi), a premium of about Rs 38,000 over the price of earlier Accord. — PTI

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Singapore Stock Exchange eyes stake in BSE

Mumbai/Singapore, January 9
The Bombay Stock Exchange, which is currently in the process of finalising a strategic partner as per its demutualisation scheme, is in talks with Singapore's stock exchange to explore various business opportunities together.

The Singapore Exchange (SGX) said in a statement today that it was "in preliminary discussions with the BSE on a number of possibilities".

While sources close to the development said SGX was one of the potential suitors for acquiring a 26 per cent stake in the BSE, the exchange officials declined to comment any further on the talks.

Besides, SGX, the other potential strategic partners are believed to be Nasdaq and the New York Stock Exchange, UK's London Stock Exchange and Germany's Deutsche Boerse.

The BSE's Board of Directors had held a meeting earlier this month, presumably to discuss its strategic partnership with various foreign bourses. — PTI 

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Tap opportunities in services sector, says Satyam chief
Tribune News Service

Hyderabad, January 9
India should grab the opportunity in services sector available in the global market, Satyam Computers Chairman B Ramalinga Raju said.

Speaking at the Gitex-India annual IT exhibition being held at the Hyderabad International Convention Centre here, Mr Raju said the proportion of services globally is two-third of the global economy, which stands at more than $42 trillion.

“Two-third of this economy is in services sector, and at least half of it can be managed and delivered virtually. That clearly establishes the size of the opportunity,” he pointed out.

Mr Raju identified infrastructure, human resources and world trade issues as impacting IT sector. Stressing the need to create world-class infrastructure, he said unless the government did something about it, we would not be able to continue the momentum.

He clarified that what was required for this task was a pro- active government as funding and skills were available in plenty in the country.

Calling the government to help build capacities in human resources, he said while we produced 3 million graduates, engineers and post-graduates every year, only 16 percent got utilised in the industry.

Domestic market is very small as compared to export market in India, Mr Raju said. The size of IT market in China is as large as it is in India; the only difference was that 80 per cent of our industry sustained out of serving global markets. It was the other way round for china.

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TCS topples Infosys as most valued IT firm

Mumbai, January 9
Tata Consultancy Services today toppled IT major Infosys to become the country's most valued IT firm.

The Tata entity moved ahead with a market capitalisation of Rs 1,22,858.34 crore as against Infosys' Rs 1,22,256.21 crore on the Bombay Stock Exchange.

The company has moved to an overall third ranking in terms of market cap charts, which are led by PSU major ONGC and Reliance Industries.

The ONGC's market cap stood at Rs 1.96 lakh crore followed by corporate behemoth Reliance Industries at Rs 1.78 lakh crore today.

Infosys is at the fourth place while the fifth slot is commanded by telecom giant Bharti Airtel at Rs 1.18 lakh crore.

The TCS scrip managed to gain nearly Rs 10 to close at Rs 1,255.45 today whereas Infosys lost about Rs 14 to settle at Rs 2,191.60 at the BSE. — PTI 

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BRIEFLY

Rupee gains 14 paise
Mumbai, January 9
The rupee closed three weeks higher today at Rs 44.38/39 against the dollar as compared to the previous day's closing of Rs 44.52/53, dealers said. The domestic currency appreciated by 0.20 per cent and closed at Rs 44.39. The RBI today fixed the reference rate at Rs 44.47 per US dollar, down by five paise from its yesterday's rate of Rs 44.42. — UNI

Tata Tele
Kolkata, January 9
In a bid to increase its market presence in the eastern region, Tata Teleservices will invest Rs 1,430 crore in the current fiscal in Kolkata, Bengal, Bihar and Orissa circles, Tata Teleservices COO-Kolkata Circle Abhijit Paul said her today. Mr Paul said, ''About Rs 1128 has already been invested in this region till December 31.'' The company would also invest Rs 170 crore in Kolkata circle. — UNI

Punj Lloyd
New Delhi, January 9
Punj Lloyd along with its offshore engineering arm - PT Sempec Indonesia- has bagged a Rs 1289.25-crore order from the ONGC. The company has secured the Heera redevelopment project on an engineering procurement and construction (EPC) basis, scheduled to be completed within 16 months, a company statement said. The Heera field is located about 80 km west of Mumbai in the Arabian Sea. — PTI

Stake in Matrix
Mumbai, January 9
US-based Mylan Laboratories Inc has acquired around 51.5 per cent stake in pharmaceutical company Matrix Laboratories for Rs 306 per share. With the completion of the deal, M. P. Laboratories (Mauritius) Ltd, a wholly owned subsidiary of Mylan, now owns about 71.5 per cent stake in Matrix.— PTI

PLR hiked
Mumbai, January 9
The State Bank of Bikaner & Jaipur today announced a hike in its prime lending rate(PLR) to 12 per cent. The rate has been revised from 11.5 per cent to 12 per cent per annum effective from January 9, the bank said. The bank also increased the interest rates on domestic term deposits of 180 days to less than one year by 0.5 per cent to 7.25 per cent. — PTI

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