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Relook at pre-IPO placement policy
Realtors seek FII status for pre-sale offer

New Delhi, May 21

The government is having a relook at the policy governing pre-Initial Public Offer (IPO) sale of shares by real estate companies to foreign investors, which could see the private placement of equity being classified as investment by financial institutions.

India, Mexico ink trade pact
New Delhi, May 21
India and Mexico signed an agreement on bilateral investment promotion and protection agreement (BIPPA) of investments, aimed at increasing bilateral investment flow, here today.While finance minister P Chidambaram signed the agreement on behalf of India, Mexican minister of economy Eduardo Sojo signed on behalf of Mexico.
Minister of economy of Mexico Eduardo Sojo (left) and union finance minister P. Chidambaram shake hands after exchanging documents of Bilateral Investment Promotion and Protection Agreement between the two countries in New Delhi on Monday.
Minister of economy of Mexico Eduardo Sojo (left) and union finance minister P. Chidambaram shake hands after exchanging documents of Bilateral Investment Promotion and Protection Agreement between the two countries in New Delhi on Monday. — PTI photo

Reliance Cap sells stake in RE
Mumbai, May 21
Reliance Capital today sold its entire stake in Reliance Energy (RE) to other promoters in a block deal on the bourses, booking profits of about Rs 350 crore.



EARLIER STORIES

 
A commercial plane takes off behind business aircrafts with the newly certificated Dassault Falcon 7x (centre) during the 7th Annual European Business Aviation Convention & Exhibition (EBACE), on Monday at Geneva’s international airport in Switzerland. The annual meeting place for the European business aviation community showcases nearly 250 exhibiting companies from around the world. More than 30 aircrafts, including nearly every major business aircraft design in current production, are on display in a special 18,000 sq meter static display area.
A commercial plane takes off behind business aircrafts with the newly certificated Dassault Falcon 7x (centre) during the 7th Annual European Business Aviation Convention & Exhibition (EBACE), on Monday at Geneva’s international airport in Switzerland. The annual meeting place for the European business aviation community showcases nearly 250 exhibiting companies from around the world. More than 30 aircrafts, including nearly every major business aircraft design in current production, are on display in a special 18,000 sq meter static display area. — AFP photo

New FDI norms within two months: Nath
New Delhi, May 21
New Foreign Direct Investment (FDI) norms, aimed to plug loopholes in the existing FDI norms, would be announced in six to eight weeks from now, commerce and industry minister Kamal Nath said here today.

Sun Pharma to buy Taro for $454 m
Mumbai, May 21
Sun Pharmaceutical Industries today said it would acquire Israel-based Taro Pharmaceutical Industries Ltd, a multinational generic manufacturer, in an all-cash deal for $ 454 million dollar.

Airtel slashes ISD rates by 39 pc
New Delhi, May 21
Bharti Airtel today said it would slash international call rates on a global call card from India to the US and Canada by over 39 per cent to Rs 1.99 per minute, setting a price war in the ISD market.

TRAI releases paper on non-CAS areas
New Delhi, May 21
The Telecom Regulatory Authority of India (TRAI) today released a consultation paper on issues relating to tariff for cable television services in non-CAS areas, advancing the plea that there was a need to take stock of the efficacy of existing tariff regime, which was more than two years old.
An employee of Japanese microscope maker Scalar snows off the company’s eyeglasses with attached display and viewer called the “Teleglass T3-F” and its remote controller (bottom) in Tokyo on Monday. When the device is attached to eyeglasses, a user can view images equivalent to a 28-inch screen located two meters away. The new product is priced at $810
An employee of Japanese microscope maker Scalar snows off the company’s eyeglasses with attached display and viewer called the “Teleglass T3-F” and its remote controller (bottom) in Tokyo on Monday. When the device is attached to eyeglasses, a user can view images equivalent to a 28-inch screen located two meters away. The new product is priced at $810 — AFP photo

Wind Energy
NTPC to pump Rs 1,200 crore

New Delhi, May 21
After ONGC, HPCL and Tata Power, NTPC Ltd now plans to foray into wind power with an investment of more than Rs 1,200 crore as it seeks to diversify into renewable energy.

Corporate Results
SAIL net up; declares 31 pc dividend

New Delhi, May 21
Led by strong demand for steel, state-owned SAIL today reported a 72 per cent jump in its net profit for the quarter ending March 31 at Rs 1,902 crore. For the year 2006-07, it recorded a 55 per cent increase in net profit at Rs 6,202 crore and declared a 31 per cent dividend. The company achieved an all-time high annual turnover of Rs 39,189 crore and highest ever profit before tax at Rs 9,423 crore during the year.

M&M open offer for PTL from May 28
Mumbai, May 21
Utility vehicle firm Mahindra & Mahindra today announced new schedule for its open offers to buy 20 per cent stake each in Punjab Tractors and Swaraj Engines.

After US, Indian mangoes go to Japan
New Delhi, May 21
After the USA, India has started exporting mangoes to Japan with the first consignment of one tonne of banganpalli mangoes from Tirupati sent to Tokyo.

 

 

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Relook at pre-IPO placement policy
Realtors seek FII status for pre-sale offer

New Delhi, May 21
The government is having a relook at the policy governing pre-Initial Public Offer (IPO) sale of shares by real estate companies to foreign investors, which could see the private placement of equity being classified as investment by financial institutions.

“The Department of Economic Affairs and Department of Industrial Policy and Promotion have come around to the view that the pre-IPO sale of shares by real estate companies should be given the status of FII investment,” sources said.

The Reserve Bank of India is, however, still to be taken on board as it is sticking to its earlier stand that as pre-IPO placement is made by the promoter on his discretion it must be treated as FDI.

The central bank has argued that Foreign Exchange Management Act (FEMA) needs to be amended if FDI in real estate has to be given the status of portfolio investment.

Real estate companies, which want to encash on the boom in the sector, have been seeking FII status for their pre-offer placement, as many of their existing projects do not meet tough FDI norms.

The change in classification would provide relief to many of them who have lined up IPOs. As per the earlier norms, if the real estate companies had raised funds from foreign financial institutions they would have been classified as Foreign Direct Investment.

To qualify for receiving FDI, all their projects should comply with the regulations on size. At present FDI is only allowed in projects spread over 10 hectares and the minimum investment should be above $ 5 million. — PTI

Centre hopes to slow down external debt: FM

New Delhi, May 21
Couple of days after it issued fresh norms, tightening External Commercial Borrowings (ECBs), the Centre today hoped that it would slow down foreign debt into the real estate sector.

“Now the window has been narrowed down. We hope that the flow of external debt to real estate sector will slow down,” Union Finance Minister P Chidambaram told newspersons here.

Alarmed by sustained price rise in the economy, the government had on Friday took steps to restrict the flow of foreign funds into the country by tightening norms to raise debt abroad.

The new norms have barred realty companies from raising debt in overseas markets for the development of integrated townships. Till date, the government had allowed real estate companies to raise foreign funds for integrated townships developed on a minimum of 100 acres of land.

The government’s move came on the heels of RBI’s measures to curb credit flows to the sector following apprehensions of overheating that could derail the economy.

The Finance Minister, however, refused to comment when asked whether further curbs on overseas funds are likely in the future.

As per the RBI, about $ 20.24 billion have been raised by 812 companies through ECBs during the April 2006-February 2007 period.

Bankers said excessive inflow of dollars due to heavy borrowings by the companies through ECB has created problems for the Reserve Bank to contain inflation as well.

The government is finding it difficult to contain the flow of external debt as majority of the capital raised abroad comes through the automatic route. — TNS

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India, Mexico ink trade pact
Tribune News Service

New Delhi, May 21
India and Mexico signed an agreement on bilateral investment promotion and protection agreement (BIPPA) of investments, aimed at increasing bilateral investment flow, here today.

While finance minister P Chidambaram signed the agreement on behalf of India, Mexican minister of economy Eduardo Sojo signed on behalf of Mexico. The agreement seeks to promote and protect investments with the objective of increasing bilateral investment flow.

The agreement would remain in force for a period of ten years and is expected to serve as a catalyst in boosting investment flows between the two countries.

The term investment includes every kind of asset including intellectual property rights in accordance with laws and regulations of the country in which the investment is made.

Principles of Most Favoured Nation Treatment and National Treatment (NT) have been asserted in the agreement. It also provides for free repatriation of funds of an investor of either country.

Chidambaram said in the last decade bilateral trade has grown almost five times and has reached about $2 billion. The investments in Mexico by Indian investors have crossed $1.5 billion.

He also emphasised that as Mexico is a member of important free trade associations including the NAFTA, this agreement will certainly be remembered as one of the most important treaties which India has signed in recent times.

Sojo referred to the rapid growth of bilateral trade and Indian investments in Mexico and assured that the Indian investors would be provided with all possible incentives.

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Reliance Cap sells stake in RE

Mumbai, May 21
Reliance Capital today sold its entire stake in Reliance Energy (RE) to other promoters in a block deal on the bourses, booking profits of about Rs 350 crore.

Reliance Capital, the financial services arm of ADAG, sold over 1.3 crore shares, representing 5.79 per cent stake in Reliance Energy, market sources said.

At the current price, the deal size amounts to about Rs 725 crore. Sources close to RCL also confirmed the deal.

Besides Reliance Capital, the other promoters of Reliance Energy include AAA Project Ventures, Reliance Innoventures, Hansdhwani Trading Company and members of Ambani family. — PTI

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New FDI norms within two months: Nath
Tribune News Service

New Delhi, May 21
New Foreign Direct Investment (FDI) norms, aimed to plug loopholes in the existing FDI norms, would be announced in six to eight weeks from now, commerce and industry minister Kamal Nath said here today.

“It (new FDI norms) will be announced in six to eight weeks….The new norms would be a prospective change in the FDI regime and not affect existing investments,” Nath said at a function organised by the CII.

The existing FDI norms allow foreigners to effectively own stakes in Indian companies higher than the sectoral caps.

The Centre is expected to tighten norms pertaining to both direct and indirect shareholding in the wake of controversy surrounding the Hutchison-Essar shareholding.

There are, at present, four distinct FDI slabs - telecom sector (74 per cent), aviation (49 per cent), insurance (40 per cent) and real estate and infrastructure (100 per cent).

On the surging rupee affecting severely the competitiveness of Indian exporters, especially small and medium enterprises, Nath said the government would take some measures to help exporters.

He, however, did not elaborate on kind of measures the government would wish to initiate.

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Sun Pharma to buy Taro for $454 m

Mumbai, May 21
Sun Pharmaceutical Industries today said it would acquire Israel-based Taro Pharmaceutical Industries Ltd, a multinational generic manufacturer, in an all-cash deal for $ 454 million dollar.

Sun Pharmaceutical, together with its subsidiaries, has signed definitive agreements to this effect and it would be subject to shareholders approval and other requisite regulatory clearances.

“This is a good opportunity for Sun and Taro to work together to create increasing value and add a complimentary multinational organisation to Sun’s business,” Sun Pharmaceutical chairman and managing director Dilip Shanghvi said.

Sun Pharmaceutical would fund this $ 454 million-acquisition with internal accruals and proceeds from its earlier $ 350 million Foreign Currency Convertible Bonds (FCCBs) issue, Sun Pharmaceutical said in a filing to BSE.

This deal values Taro’s equity at $ 230 million, or $ 7.75 per share, which is at a 27 per cent premium to its May 18 closing price of $ 6.10.

This deal comes in the midst of a motion filed by two of Taro’s beneficial owners of around 9 per cent shareholding Franklin Advisers, Inc and Templeton Assets Management Ltd, to prevent Taro from entering into any transaction, which might result in discrimination against minority public shareholders.

On May 10, Franklin Advisers and Templeton Assets Management had filed a motion in Tel-Aviv District Court to prevent what they allege to be discrimination against minority shareholders.

Later on May 19, Franklin Advisers and Templeton filed a request with the court for a temporary injunction to prevent Taro from entering into any transaction, which might result in discrimination against minority public shareholders.

“Sun Pharmaceutical and Taro believe that the proceedings initiated by Franklin Advisers and Templeton are without merit and are detrimental to the best interests of shareholders and Taro. Taro intends to contest the action vigorously,” Sun Pharmaceutical said.

“We look forward to working with Taro and its employees going forward. With the addition of 170 talented scientists to our team we look forward to increasing number of product filings of higher complexity,” Shanghvi said.

Taro has a strong franchise in dermatology and topical products, in addition to product baskets in cardiovascular, neuropsychiatric and anti-inflammatory therapeutic categories. It has established subsidiaries, manufacturing and products across US, Israel, Canada and North America.

“We intend to build on Taro’s expertise in dermatology and pediatrics, along with specialty and generic pharmaceuticals, and over-the-counter products,” Shanghvi added.

However, as reported on March 20 by Taro, it expects to report a substantial loss for the year ended December 31, 2006.

In a separate filing Sun Pharmaceutical said its Committee of Directors has allotted 5,18,417 equity shares of Rs 5 each at a premium of Rs 724.30 per share upon conversion of 8,400 FCCBs of $ 1000 dollar each. — PTI 

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Airtel slashes ISD rates by 39 pc

New Delhi, May 21
Bharti Airtel today said it would slash international call rates on a global call card from India to the US and Canada by over 39 per cent to Rs 1.99 per minute, setting a price war in the ISD market.

The new tariffs, close on the heels of Reliance’s move of lowering the ISD rates, will come into effect from tomorrow. The revised tariff is applicable on the Airtel STD and ISD calling card of Rs 2,245.

Tata calling card

Shimla: The Tata Teleservices today introduced “India Calling Cards” for its Tata Indicom mobile and walky customers, facilitating STD and ISD calls irrespective of any long distance call facility activated on the connection. The calling cards operate by dialing access number along with a distinctive PIN number, which serves as a numeric code given to every calling card. The calling cards facilitate STD calls at Rs 1.5 per minute with calling card of Rs 500. All the calls to the USA, UK and Canada could be charged at Rs 4.5 per minute and calls made to gulf at Rs 7.2 per minute. — UNI, TNS

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TRAI releases paper on non-CAS areas

New Delhi, May 21
The Telecom Regulatory Authority of India (TRAI) today released a consultation paper on issues relating to tariff for cable television services in non-CAS areas, advancing the plea that there was a need to take stock of the efficacy of existing tariff regime, which was more than two years old.

The TRAI has sought comments from all the stakeholders by June 4 to formulate a policy for cable TV operations in non-CAS areas.

Regulation of tariff for cable television service in non-CAS areas is presently governed by provisions contained in the tariff order of October 1, as amended from time to time.

This principal tariff, inter alia, provided that cable charges payable by subscriber to cable operator, by the cable operator to multi system operator (MSO) and by the multi system

operator to broadcaster would be the same as prevailing as on December 26, 2003.

It also provided a window for increase or decrease in ceiling on account of introduction or deletion of new pay channels under certain conditions. — UNI

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Wind Energy
NTPC to pump Rs 1,200 crore

New Delhi, May 21
After ONGC, HPCL and Tata Power, NTPC Ltd now plans to foray into wind power with an investment of more than Rs 1,200 crore as it seeks to diversify into renewable energy.

“We are looking at wind energy projects with a total capacity of 200-250 MW. This would require an investment of over Rs 1,200 crore,” NTPC chairman and managing director T Sankaralingam said.

The navratna PSU, which has an installed capacity of more than 26,000 MW entirely on coal or gas, has been looking to diversify into other energy sources and is already working on hydroelectric projects, besides a few small bio-mass plants.

Sankaralingam said the company was scouting for sites and it could be set up in a single location. The company would be working with Asian Development Bank and may also rope in a private partner for the new venture, he said.a“We may set up a joint venture. We are in the process of working out details regarding the equity structure,” he said. — PTI 

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Corporate Results
SAIL net up; declares 31 pc dividend

New Delhi, May 21
Led by strong demand for steel, state-owned SAIL today reported a 72 per cent jump in its net profit for the quarter ending March 31 at Rs 1,902 crore. For the year 2006-07, it recorded a 55 per cent increase in net profit at Rs 6,202 crore and declared a 31 per cent dividend. The company achieved an all-time high annual turnover of Rs 39,189 crore and highest ever profit before tax at Rs 9,423 crore during the year.

Parsvnath

Parsvnath Developers’ recorded an over three-fold increase in its net profit at Rs 132.43 crore in the fourth quarter ended March 31. Company’s total income during the quarter grew by 69.7 per cent to Rs 412.23 crore. The board declared a 25 per cent dividend for the year ended March 31. Total income during the year increased to Rs 1,260.98 crore, a 93 per cent rise.

Unichem

Unichem Laboratories today posted a 48 per cent increase in net profit at Rs 20.04 crore for the fourth quarter ended March 31 and the total income grew by 31.5 per cent at Rs 140.38 crore. Income for the year ended March 31 grew by 17.9 per cent at Rs 562.4 crore. The board of directors has decided to consider the 100 per cent interim dividend paid in March 2007 as final.

Jindal Steel

Jindal Steel and Power today posted a 34.58 per cent in net profit at Rs 202.77 crore for the fourth quarter ended March 31 and the total income (net of excise) grew by 57.83 per cent to Rs 1,074.05 crore, Jindal Steel informed the BSE. The board of directors today declared a 240 per cent final dividend. For the year ended March 31, the company recorded a net profit of Rs 702.99 crore.

StanChart India

Standard Chartered Bank (India) has registered a 51 per cent leap in its profit after tax (PAT) at Rs 1,364.3 crore for 2007 and the total income for the year ended March 31, increased by 31 per cent to Rs 5,390.1 crore, while total assets rose to Rs 58,853 crore, up by 28 per cent from the previous year. The bank’s deposits rose by 20 per cent to Rs 34,174 crore while advances climbed 25 per cent to Rs 30,103.7 crore, the bank said in a release here. — Agencies

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M&M open offer for PTL from May 28

Mumbai, May 21
Utility vehicle firm Mahindra & Mahindra today announced new schedule for its open offers to buy 20 per cent stake each in Punjab Tractors and Swaraj Engines.

The timeline for the two separate open offers, which were delayed, have been finalised and the offers would now open on May 28 and close for subscription on June 16, the manager to the offer Kotak Mahindra Capital Company said.

The ‘Letter of Offer’ was being finalised and this led to original schedule (May 3 to 22) being delayed.

M&M, proposes to carry out the transactions along with its subsidiary Mahindra Holdings and Finance, had offered to buy 1.21 crore PTL shares at Rs 360 per share.

Assuming full subscription, M&M would have 63.3 per cent control of the company as it has already agreed to buy 43.3 per cent stake in PTL from private equity firm Actis and Mohit Burman.

The schedule for M&M’s open offer to buy 20 per cent stake, representing 24.83 lakh shares in Swaraj Engines Ltd at Rs 151 per share, would begin and close on the aforementioned days.

Swaraj Engines is a joint venture between PTL and Kirloskar Oil Engines. If fully subscribed, the open offer would cost M&M nearly Rs 37.49 crore.

Reacting to the news, shares of Punjab Tractors surged 6 per cent and was last trading at Rs 309.75, still 5.16 per cent up over Friday’s closing of Rs 294.55 on the BSE.

Shares of Swaraj Engines were last trading at Rs 165, unchanged from last Friday’s closing price.— PTI 

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After US, Indian mangoes go to Japan

New Delhi, May 21
After the USA, India has started exporting mangoes to Japan with the first consignment of one tonne of banganpalli mangoes from Tirupati sent to Tokyo.

“India is exporting mangoes to Japan after a 20-year ban that was lifted for six varieties in June last year,” Minister of state for commerce Jairam Ramesh told reporters today.

The first consignment of mangoes was sent to Japan yesterday.

India would be exporting the six varieties of alphonso, banganpalli, Chausa, kesar, langra and mallika, he said, adding by July-end, India hoped to export about 35-40 tonnes (70,000 mangoes) to Tokyo.

Each banganpalli mango is expected to retail for Rs 200 in Japanese stores, he said. — PTI

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BRIEFLY

Twilight Litaka
New Delhi, May 21
Twilight Litaka Pharma Ltd today said it has signed an agreement with Bangalore-based Sami Labs Ltd to purchase 17 brands. As per the MoU, Twilight Litaka has acquired ownership of these brands, as Semi Labs engaged in nutraceuticals is having proprietary rights over certain patents. It will have the exclusive rights to manufacture and market the nutraceutical products under these brands in India. — UNI

Emaar MGF
New Delhi, May 21
Emaar MGF today announced its tie up with Australia’s Leighton Group to set up a joint venture construction company with an initial investment of up to $150 million. Emaar MGF, a joint venture between Dubai-based Emaar Properties and MGF Developments, will have equal partnership with Leighton. The JV firm would initially offer design and construction services for Emaar MGF projects across the country. — TNS

Media Video
Mumbai, May 21
Media Video today said its recently established real estate division is developing a 124-acre township at Yamuna Nagar in Haryana. The township will include both commercial and residential saleable floor space of about six million square feet. The residential premises will cover a saleable area of 5.5 million square feet and the commercial part of 0.5 million square feet, which will include a shopping mall and a budget hotel. — PTI

Indiabulls
Mumbai, May 21
Indiabulls Financial Services has raised $300 million (over Rs 1,200 crore) through issue of Global Depository Receipts (GDR). The company, which had earlier mopped up $275 million through the GDR issue, allotted another $25 million to Merrill Lynch International. The company has received authorisation from its shareholders to raise additional equity capital. — PTI

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