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THE TRIBUNE SPECIALS
50 YEARS OF INDEPENDENCE

TERCENTENARY CELEBRATIONS
B U S I N E S S

Satyam gets SEBI nod for 51% stake sale
New Delhi, March 6
Having got a clearance from market regulator SEBI for sale of 51 per cent stake in Satyam Computer Services, the company today said the global bidding process for the crisis-ridden corp will begin shortly.

Infra growth drops to 1.4 pc in Jan
New Delhi, March 6
Slowdown continues to show in the infrastructure industries as they registered a slow growth of 1.4 per cent in January. The six core infrastructure industries — crude oil, petroleum refinery products, coal, electricity, cement and finished carbon steel — had registered a growth rate of 3.6 per cent in January 2008.

BoB, ICICI Bank cut lending rates
Mumbai, March 6
Responding to signal from RBI, Bank of Baroda today announced cutting benchmark lending rate by 50 basis points to 12 per cent effective from April 1. The bank has decided to reduce its Benchmark Prime Lending Rate (BPLR) by 50 basis points from existing 12.5 per cent, Bank of Baroda informed the Bombay Stock Exchange.



EARLIER STORIES




Arun Malhotra, senior vice-president, Mahindra and Mahindra, poses with 'New Mighty Muscular Scorpio' at its launch in New Delhi on Friday. The new Scorpio is priced between Rs 7.21 lakh and Rs 9.2 lakh
Arun Malhotra, senior vice-president, Mahindra and Mahindra, poses with 'New Mighty Muscular Scorpio' at its launch in New Delhi on Friday. The new Scorpio is priced between Rs 7.21 lakh and Rs 9.2 lakh. Tribune photo: Mukesh Aggarwal

SC orders status quo on cable TV tariff
New Delhi, March 6
The Supreme Court today asked the multi-system operators and local cable operators to charge fee as per the directions of broadcast regulator TRAI, which has proposed Rs 132-260 for cable services in non-CAS areas.

Himachal industry a worried lot
Expiry of CST notification on March 31
Solan, March 6
With the Central Sales Tax (CST) notification, entailing one per cent exemption to the industrial units in Himachal, expiring on March 31, the industry is a worried lot. Since the general elections have been announced and there is a bleak possibility of its renewal, the CII has expressed concerns about its adverse fallout.

A lion dance troupe performs at the inauguration of The Coca-Cola Company's Global Innovation and Technology Center in Shanghai on Friday. US beverage giant Coca-Cola said it would invest $2 billion in China over the next three years as it looks to dramatically increase its presence in the world's largest market.
A lion dance troupe performs at the inauguration of The Coca-Cola Company's Global Innovation and Technology Center in Shanghai on Friday. US beverage giant Coca-Cola said it would invest $2 billion in China over the next three years as it looks to dramatically increase its presence in the world's largest market. — AFP

RCom offers calls to US, Canada at Rs 1.99
New Delhi, March 6
Telecom service provider Reliance Communications (RCom) today said it has launched an international calling card for the US and Canada through which users can make calls to these countries at a rate of Rs 1.99 per minute.

Over the counter debt market soon
Mumbai, March 6
Indian investors would soon have plenty of opportunities to invest in debt instruments as the debt market in the country is showing signs of maturing, says Chandrashekar Bhave, chairman, SEBI.

Vijaya Bank to expand network
Chandigarh, March 6
Vijaya Bank will now be expanding its base in North India by setting up new branches and ATMs, in order to capture the agriculture and small and medium enterprise (SME) sector. The bank is also moving on the fast track to save the recession-hit SME sector by restructuring their loans.

 





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Satyam gets SEBI nod for 51% stake sale
Tribune News Service

New Delhi, March 6
Having got a clearance from market regulator SEBI for sale of 51 per cent stake in Satyam Computer Services, the company today said the global bidding process for the crisis-ridden corp will begin shortly.

Company's board member Deepak Parekh after meeting the Corporate Affairs Minister P C Gupta, said here, “The bidding process will begin shortly.”

Country’s fourth largest software exporter earlier in the day received market regulator SEBI’s approval to sell 51 per cent of the stake through a global bidding process. Parekh, along with Satyam chairman Kiran Karnik and board member Tarun Das, today met the minister.

Meanwhile, Gupta said the bidding process was being done on a "war footing" and added that a retired Supreme Court judge would be overseeing the whole process, which would ensure that it is done in a transparent manner.

"There is no delay. The whole process is going on and it is being done on a war footing," the minister said while adding that bidders who have doubts on any issue can contact the Satyam board or the government for clarification.

Earlier, the company announced that it has received approval from SEBI to facilitate a global competitive bidding process which enables it to select an investor to acquire a 51 per cent interest in the company.

The process is expected to include a subscription by the selected investor of newly issued equity shares representing 31 per cent of the company’s share capital. Upon a successful closing of the subscription, the investor will be required to make a mandatory open offer to purchase a minimum of 20 per cent of the company’s share capital.

The open offer will be made at the same share price as the price paid by the investor for the subscription.

As of now, global IT giant IBM is understood to be the front-runner to acquire Satyam. Other prominent players interested in acquiring the controlling stake include Larsen & Toubro (L&T), which owns 12 per cent in Satyam, and the B K Modi-owned Spice group.

Satyam was hit by the financial fraud of almost Rs 7,800 crore on January 7 last following disclosure from its founder Ramalinga Raju that books had been tutored for long.

The market value of the assets of the company has been estimated at around Rs 4,000 crore after netting current and long-term liabilities. According to reports, prospective bidders are set to be furnished with the gross market value of assets at around Rs 3,500-4,000 crore.

Meanwhile, in a related development, Larsen and Toubro (L&T), the largest single shareholder in Satyam Computer, said here that it would wait for details of the bidding process and available financial figures before taking any decision on bidding.

Incidentally, the Satyam stock jumped by over 16 per cent to Rs 40.80 today backed by hefty volumes of around 1.60 crore shares on the BSE.

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Infra growth drops to 1.4 pc in Jan
Tribune News Service

New Delhi, March 6
Slowdown continues to show in the infrastructure industries as they registered a slow growth of 1.4 per cent in January. The six core infrastructure industries — crude oil, petroleum refinery products, coal, electricity, cement and finished carbon steel — had registered a growth rate of 3.6 per cent in January 2008.

During the April-January period of this fiscal, the industries posted a growth rate of 3.2 per cent against 5.7 per cent in the corresponding period previous year.

Displaying poor performance, crude oil production declined further to 8.1 per cent in January after a dip of 0.2 per cent in the corresponding month last year. As a result of this, oil refinery production showed a decline of 2.6 per cent against a growth rate of 5.4 per cent in the corresponding period last year.

Coal output and electricity generation registered growth rates of 6.3 per cent and 1.4 per cent, respectively, in January against 7.9 per cent and 3.7 per cent, respectively, in the same month previous year.

Finished steel production registered a growth of 1.2 per cent in January against 2 per cent last year, while cement production grew by 8.3 per cent compared to 5.6 per cent in January 2008.

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BoB, ICICI Bank cut lending rates

Mumbai, March 6
Responding to signal from RBI, Bank of Baroda today announced cutting benchmark lending rate by 50 basis points to 12 per cent effective from April 1.

The bank has decided to reduce its Benchmark Prime Lending Rate (BPLR) by 50 basis points from existing 12.5 per cent, Bank of Baroda informed the Bombay Stock Exchange.

The cut in the bank's prime lending rate will reduce the interest burden in all BPLR-linked advances, including home loans from the bank.

Meanwhile, the country's largest private sector lender, ICICI Bank, reduced its interest rates on new home loans by 0.25-0.50 per cent with immediate effect.

For priority sector home loans below Rs 20 lakh, the new interest rate will 9.75 per cent as against the earlier 10 per cent.

For loans in the range of Rs 20-30 lakh, the interest rate has been reduced to 10 per cent as against the earlier 10.5 per cent, an ICICI Bank spokesperson said.

For loans of above Rs 30 lakh, the interest rate has been reduced to 11.50 per cent against the earlier 12 per cent.

The reduced rates are applicable only to new home loans, the spokesperson said.

Yesterday, another Mumbai-based state-owned lender Union Bank of India had announced a 0.50 per cent cut in BPLR to 12 per cent.

As part of monetary easing measure, RBI cut repo (overnight lending rate) by 50 basis points to 5 per cent and reverse repo (overnight borrowing rate) identically to 3.5 per cent signaling banks to cut rates. — PTI 

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SC orders status quo on cable TV tariff

New Delhi, March 6
The Supreme Court today asked the multi-system operators and local cable operators to charge fee as per the directions of broadcast regulator TRAI, which has proposed Rs 132-260 for cable services in non-CAS areas.

A Bench headed by Chief Justice K G Balakrishnan in an interim order said the tariff, which was in existence at the time when the sectoral tribunal rejected TRAI's order putting a ceiling on cable service charges, will continue for next two weeks.

"Status quo as on the date of the TDSAT order to continue," it said, while adjourning the matter for two weeks.

Broadcast regulator TRAI on October 4, 2007, had issued a circular directing a price band of Rs 132-260 for cable services based on a classification of cities and the number of pay channels provided by multi-system operators (MSOs).

Earlier, the court had asked the broadcasters to work out some interim arrangement (till TRAI completes its exercise of reframing the new tariff order within 4-6 months) on tariff to be charged across the country.

The Telecom Disputes Settlement and Appellate Tribunal (TDSAT) had set aside the Telecommunications (Broadcasting & Cable) Services (Second) Tariff (Eighth Amendment) Order 2007 and held that the regulator had violated principles of transparency.

TRAI had challenged the TDSAT judgement. — PTI 

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Himachal industry a worried lot
Expiry of CST notification on March 31
Ambika Sharma

Solan, March 6
With the Central Sales Tax (CST) notification, entailing one per cent exemption to the industrial units in Himachal, expiring on March 31, the industry is a worried lot. Since the general elections have been announced and there is a bleak possibility of its renewal, the CII has expressed concerns about its adverse fallout.

Anil Sehgal, CII chairman for the HP State Council, while expressing concern over the situation, said this would be a major setback to Himachal where all finished goods have to be marketed outside the state. While this will increase the manufacturing cost, it would reduce the competitiveness of the industry vis-à-vis its counterparts in the non-incentive states. This was more so since all raw materials were being procured from outside the state.

Though the CII would pursue the issue on a priority basis, but there was little likelihood of the notification being renewed in lieu of the enforcement of the model code of conduct.

Sehgal added that this would offset the long-term business agreements of various industrial units which would not augur well for a state like Himachal, where industry was in its nascent stage.

The expiry of this notification would bring the CST at 2 per cent, at par with the non-incentive states, from April onwards and orders would have to be re-scheduled in light of this added levy, confided investors.

Officials in the Industries Directorate, however, said that since the industry failed to raise this demand before the enforcement of the model code of conduct, no respite could be granted now. This incentive had been granted in 1999 for a period of 10 years, which would expire on March 31.

Sources, however, pointed out that the central government was already phasing out this concession and from the earlier 4 per cent it had come down to 2 per cent now.

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RCom offers calls to US, Canada at Rs 1.99

New Delhi, March 6
Telecom service provider Reliance Communications (RCom) today said it has launched an international calling card for the US and Canada through which users can make calls to these countries at a rate of Rs 1.99 per minute.

With a talktime of over Rs 724, the US Canada Card also offers competitive calling rates to other parts of the world, the company said in a statement. On an e-recharge of Rs 799, the card gives a talktime of 350 minutes for calling to the US and Canada to its customers, it added. This offer is available till April 30. — TNS

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Over the counter debt market soon
Tribune News Service

Mumbai, March 6
Indian investors would soon have plenty of opportunities to invest in debt instruments as the debt market in the country is showing signs of maturing, says Chandrashekar Bhave, chairman, SEBI.

Addressing a conference on the industry here, Bhave said debt market was maturing as investors with money were showing signs of investing in debt instruments. "Soon we will have over the counter debt market where debt instruments would be traded..... there are signs that people would be issuing large debt instruments," Bhave said.

Bhave said, "reliable insurers" would have no problems mobilising huge funds by way of debt. "There is a possibility that a debt market is opening up in India," he said.

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Vijaya Bank to expand network
Ruchika M. Khanna
Tribune News Service

Chandigarh, March 6
Vijaya Bank will now be expanding its base in North India by setting up new branches and ATMs, in order to capture the agriculture and small and medium enterprise (SME) sector. The bank is also moving on the fast track to save the recession-hit SME sector by restructuring their loans.

This was disclosed by S C Kalia, executive director of Vijaya Bank, while talking to TNS here today. “We propose to open six new branches in Chandigarh region office, which comprise the states of Punjab, Haryana, Jammu and Kashmir, Uttaranchal and Uttar Pradesh. These branches will be opened at Sirsa, Sangrur, Rourkee, Bhiwani, Pathankot and Hamirpur during this month,” he said.

Kalia said though the bank had a good presence in South India, the future focus of the bank would be on expansion in Punjab, Haryana, Rajasthan and Gujarat. “So far, we have not been able to exploit the huge business potential here. Though we have 107 branches (of a total of 1,067) in North India and we are doing business worth Rs 14,396 crore, the total percentage of business in north region is just 16.61 per cent. By increasing our presence here, we hope to ensure that at least 20 per cent of the bank’s business is from this region,” he added.

Talking about the steps taken to help the recession-hit SME sector, he said banks have restructured loans worth Rs 8,000 crore during the five months ended January 2009. 

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