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Global stocks tumble
l MSCI world equity index down 1.7 per cent  
l
GM, Chrysler concerns and banking woes hit shares
l
Government bonds, yen rally; oil falls

London, March 30

A man looks at a branch of savings bank Caja Castilla La Mancha (CCM) in central Madrid World stocks hit a one-week low and government bonds rose on Monday after General Motors and Chrysler edged closer to bankruptcy as their turnaround plans were rejected and tensions rose in Europe's banking sector.

A man looks at a branch of savings bank Caja Castilla La Mancha (CCM) in central Madrid on Monday. The Bank of Spain will bail out regional savings bank Caja Castilla la Mancha, the government said on Sunday, as a slumping property market forced the first banking rescue in Spain since the financial crisis began.— Reuters

Sensex loses 480 points
Mumbai: Snapping the longest rally of 2009, for five days, the benchmark Sensex today tumbled by a whopping 480 points to close below the 10,000-mark at 9,568.14 following distinctly weak global cues amid political uncertainty.



EARLIER STORIES



Growth above 8 pc sustainable: RBI
Mumbai, March 30
The Reserve Bank of India expects the economy's growth rate to bounce back above 8 per cent once the current global economic and financial turmoil passes, Deputy Governor Rakesh Mohan said on Monday.

General Motors’ CEO quits
Washington, March 30
General Motors' Rick Wagoner today said he has stepped aside as the chief executive officer of the company after US White House officials asked him to leave the ailing auto maker. "On Friday I was in Washington for a meeting with Administration officials. In the course of that meeting, they requested that I 'step aside' as CEO of GM, and so I have," Rick Wagoner said in a statement.

Reliance halts oil output at KG-D6 
New Delhi, March 30
Reliance Industries Ltd (RIL) has once again shut down crude oil production at its predominantly gas-rich KG-D6 block to hook up more wells that will raise the output to a peak of 40,000 barrels per day.

Global M&A deals down 42%
New Delhi, March 30
The global merger and acquisition (M&A) sphere witnessed 42 per cent decline in its value reaching $482 billion so far this year, a report by global deal tracking firm Dealogic said. "Global completed M&A volume reached $482 billion in 2009 year-to-date (YTD), down 42 per cent from $829.3 billion in 2008 YTD," Dealogic said.

DoT seeks FinMin’s views
New Delhi, March 30
Going a step ahead on the suggestion of telecom regulator TRAI on barring promoters of new telecom companies from selling their equity stake for a period of three years, the Department of Telecom (DoT) has sought the views of the Finance Ministry on it.

US-based TalentTrove to foray into India
Chandigarh, March 30
TalentTrove Inc., a US-based media firm that offers an online platform to people for showcasing their talent, is now making its entry into India. The company, promoted by an Indian, Devinder Singh, will invest $30 million in India by 2011.

Air India launches flights to NY, Chicago
Frankfurt, March 30
Air India, owned by National Aviation Co, has expanded its international operations with the launch of two daily flights from Mumbai and Delhi to New York and Chicago via here and opened a European hub at the Frankfurt Airport.

‘India Inc stops fresh hiring’
New Delhi, March 30
Indian corporates have virtually stopped fresh recruitments to cut costs in the wake of global credit crunch, says a study by industry body Assocham. Out of 150 Human Resource professionals interviewed, 90 per cent said: “There is a virtual ban on fresh recruitments in the private sector as attrition rate has almost subsided in all sectors of economy”.

Cap on wheat stock limit lifted
New Delhi, March 30
With abundant wheat in stock and bumper crop, the government on Monday decided to dispense with the wheat stock limit order, through which states can impose a cap on the quantity that traders can keep with them.





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Global stocks tumble
l MSCI world equity index down 1.7 per cent l GM, Chrysler concerns and banking woes hit shares l Government bonds, yen rally; oil falls

London, March 30
World stocks hit a one-week low and government bonds rose on Monday after General Motors and Chrysler edged closer to bankruptcy as their turnaround plans were rejected and tensions rose in Europe's banking sector.

The Obama administration's autos task force rejected multi-billion dollar pleas from the two US automakers for more funds and warned both could be put through bankruptcy to slash debts. The auto industry woes are putting more pressure on Group of 20 leaders as they meet in London this week to discuss measures to tackle the crisis.

In the latest sign of global stress, Spain was forced to bail out regional savings bank Caja Castilla la Mancha, its first banking rescue since the financial crisis began.

"Today's main negative trigger is the GM-Chrysler news. Add to this the Spain bailout and it's clear that the markets are falling," said Giuseppe-Guido Amato, strategist at Lang & Schwarz in Germany.

MSCI world equity index fell 1.8 per cent, having risen 4.5 per cent last week. The FTSEurofirst 300 index fell 2.3 per cent.

Banking sector concerns intensified also after Germany and Britain acted to shore up lenders.

Germany's government has agreed to take an 8.7 per cent stake in stricken Hypo Real Estate as a prelude to acquiring full control. Britain helped orchestrate the takeover of building society Dunfermline by Nationwide.

US stock futures were down around 2.3 per cent, pointing to a weaker start on Wall Street. GM shares fell 18 per cent in pre-market trading.

US crude oil fell 3.2 per cent to $50.70 a barrel.

The low-yielding yen, which rises in times of risk aversion, gained 1.4 per cent to 96.67 per dollar. The euro was down a third of a per cent at $1.3181 while the dollar rose 0.6 per cent against a basket of major currencies.

G20 focus

Investors are looking to this week's G20 summit to see if the leaders can further bolster confidence in equity markets, which are on track for the biggest monthly gain in nearly 9 years despite Monday's losses.

The Financial Times newspaper, quoting a draft communique, said the G20 leaders hope to restore global growth by the end of 2010 but much depends on when the United States pulls out of its economic tailspin.

"It is `make or break time' and politicians and central bankers have to decide to agree or disagree, to find a global policy response or to continue uncoordinated isolated national approaches eventually leading to financial and market protectionism making this crisis even worse," BNP Paribas said in a note to clients. — Reuters

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Sensex loses 480 points

Mumbai: Snapping the longest rally of 2009, for five days, the benchmark Sensex today tumbled by a whopping 480 points to close below the 10,000-mark at 9,568.14 following distinctly weak global cues amid political uncertainty.

Wall Street saw a fresh fall last Friday as Washington rejected the restructuring plan for automakers and there were expectations of weak earnings. The Dow Jones Industrial Average and the Nasdaq Composite Index dropped by nearly 148 points and 42 points, respectively.

The Bombay Stock Exchange 30-share barometer resumed sharply lower at 9,902.35 from last Friday's close of 10,048.49 and gradually moved down further to settle the day at 9,568.14, a steep decline of 480.35 points or 4.78 per cent. The index had gained 1,081.81 points or 12.06 per cent in the bull run last week.

Similarly, the 50-issue of the National Stock Exchange also dipped by 130.50 points or 4.20 per cent to 2,978.15 as against the previous close. — PTI

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Growth above 8 pc sustainable: RBI

Mumbai, March 30
The Reserve Bank of India expects the economy's growth rate to bounce back above 8 per cent once the current global economic and financial turmoil passes, Deputy Governor Rakesh Mohan said on Monday.

"Our overall assessment is that an 8 per cent-plus growth is sustainable in the medium term. We can expect to come back to 8 per cent-plus growth once this interregnum is over," Mohan told a news conference.

The government expects the economy to grow about 7 per cent in the fiscal year that ends on March 31, well below rates of 9 per cent or more in the previous three fiscal years.

Mohan said India would be cautious in moving towards fuller capital account convertibility for the rupee currency. "We have also looked at the fuller capital account convertibility and concluded its desirable, but we need to move with caution," he said. — Reuters

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General Motors’ CEO quits

Washington, March 30
General Motors' Rick Wagoner today said he has stepped aside as the chief executive officer of the company after US White House officials asked him to leave the ailing auto maker.

"On Friday I was in Washington for a meeting with Administration officials. In the course of that meeting, they requested that I 'step aside' as CEO of GM, and so I have," Rick Wagoner said in a statement.

Announcing rejiging of the corporate officers and the board of directors, GM in a separate statement said "Rick Wagoner is stepping down as chairman and CEO, effective immediately." Wagoner, 56, was named president and CEO of the auto company in 2000 and assumed the role of chairman in 2003.

Fritz Henderson, GM president and chief operating officer, would serve as CEO. Henderson, 50, was named to his current position in 2008. He was previously vice-chairman and chief financial officer, GM said.

Obama denies addl funds

Meanwhile, the United States rejected rescues for General Motors and Chrysler, rekindling concern the automakers could go bankrupt, while three European governments were forced to help struggling lenders.

A White House task force rejected restructuring plans and pleas for billions in funding from the two automakers on Monday, calling for GM chief executive Rick Wagoner to step down, which he did.

US President Barack Obama said at the weekend the two companies had not done enough to save themselves since receiving a $17.4-billion bailout in December.

GM will get funds to keep operating for 60 days but up to $30 billion in new loans it is seeking are on hold until it reworks its restructuring plan.

Chrysler, controlled by Cerberus Capital Management, was told to complete a planned alliance with Italy's Fiat within 30 days or risk liquidation. — Agencies

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Reliance halts oil output at KG-D6 

New Delhi, March 30
Reliance Industries Ltd (RIL) has once again shut down crude oil production at its predominantly gas-rich KG-D6 block to hook up more wells that will raise the output to a peak of 40,000 barrels per day.

Reliance shut down production at the MA field on the midnight of March 22 for 45 days to connect more oils that will raise the output, a source said.

The MA field was producing about 18,000 barrels per day of oil from three wells when it was shut down. Two-three more wells would be hooked up in the planned shutdown period.

"Output is expected to rise to 40,000 bpd before the end of the April-June quarter," the source said.

The Reliance spokesperson did not return calls for comments.

The MA field in KG-D6 off the Andhra coast, which began pumping out oil in September 2008, had produced 7,90,000 barrels of oil till December 9 last year, when output ceased due to equipment failure. It had resumed production earlier this month after the three-month shutdown.

RIL, the source said, sold a second cargo from the MA field to Chennai Petroleum Corp Ltd (CPCL). A 4,50,000-barrel cargo was delivered to CPCL's refinery near Chennai last week. The billionaire Mukesh Ambani-run firm had sold the first cargo of over 4,30,000 barrels of oil to Hindustan Petroleum Corp Ltd's Vizag refinery in November.

The source said three more wells are likely to be brought into production during the 45-day planned shutdown period.

RIL was producing about 10,000 barrels of oil per day from two wells before the December 9 shutdown and it added one more well to raise the output in March.
— PTI

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Global M&A deals down 42%

New Delhi, March 30
The global merger and acquisition (M&A) sphere witnessed 42 per cent decline in its value reaching $482 billion so far this year, a report by global deal tracking firm Dealogic said. "Global completed M&A volume reached $482 billion in 2009 year-to-date (YTD), down 42 per cent from $829.3 billion in 2008 YTD," Dealogic said.

The number of such deals has also come down with only 6,693 deals registering so far this year, against 10,182 deals in 2008 YTD. However, there has also been a significant rise in large-sized deals over $217.6 billion.

"There have been 10 deals valued at over $10 billion announced in 2009 with the total volume of $217.6 billion, accounting for 27 per cent of volume in 2009 YTD compared with 25 per cent in 2008 YTD," the firm said. According to the report, financial sector led the pack with 266 deals above $120 billion, followed by healthcare with 196 transactions. Utility & Energy Industry bagged the third slot with 1,044 deals in the range of $40-60 billion.

Other industries where M&A activities were prominent so far this year include mining (449 deals), real estate and property (356 deals), auto and truck (231 deals) and computers & electronics (237 deals) among others.

In terms of global M&A Advisor Rankings 2009, JP Morgan topped the list with 70 deals aggregating $207.2 billion, followed by Morgan Stanley which advised 61 deals totalling $198.5 billion, Dealogic said.

However, in terms of completed M&A deals in 2009, Goldman Sachs led the advisory ranking, with transactions valued at $173.4 billion, followed by Citi with $143.9 billion and Bank of America-Merrill Lynch with $138.6 billion, it added.

The top M&A deals in 2009 YTD includes Switzerland-based Roche's acquisition of a 45.61 per cent stake in Genentech for $46.8 billion. — PTI 

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Stake Sale by Telcos
DoT seeks FinMin’s views
Tribune News Service

New Delhi, March 30
Going a step ahead on the suggestion of telecom regulator TRAI on barring promoters of new telecom companies from selling their equity stake for a period of three years, the Department of Telecom (DoT) has sought the views of the Finance Ministry on it.

The move, within weeks of the TRAI’s suggestion that a three-year lock-in period should be implemented to ensure that the startup firms do not sell their stakes at staggering profit margins, could mean end of the road for companies looking at making a fast buck.

Two of the startup firms have ended up with huge profits following selling of their stake in their telecom arms to foreign companies looking to make an entry into India. Initially, it was Swan telecom and then Unitech which sold their stakes to Etilisat and Telenor, respectively.

DoT has asked the Finance Ministry to give its views on the issue by April 6. There were also concerns raised over new private telecom players making windfall gains allegedly at the cost of the national exchequer.

However, it has come out that the deals announced by new players have been structured in such a way that the promoter’s equity in the company does not get diluted. These companies have brought in a strategic partner by issuing fresh equity.

Officials point out that while no company can be stopped from issuing fresh equity, the objective of the new rule is to prevent promoters from making direct profit from any stake sale.

On March 12, the regulator said promoters of telecom companies, which had recently obtained licences, should be asked to give the government half of the profits earned from selling their equity if they diluted their stake within three years of taking the licence.

There should be a lock-in of the equity share capital of promoter(s), whose net-worth has been taken into consideration for determining the eligibility for grant of UAS licence, for a period of three years from the effective date of licence, it said.

TRAI would, however, permit the promoters to sell their equity share even during the lock-in period with prior written approval of the licensor (DoT) and on fulfilment of rollout obligations on the condition that it shares 50 per cent of profit with the government.

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US-based TalentTrove to foray into India
Ruchika M. Khanna
Tribune News Service

Chandigarh, March 30
TalentTrove Inc., a US-based media firm that offers an online platform to people for showcasing their talent, is now making its entry into India. The company, promoted by an Indian, Devinder Singh, will invest $30 million in India by 2011.

The firm will launch a reality talent hunt television channel in India, venture into live talent shows, content production, film making and film distribution. The three-year old company in the US, which boasts of 1.8 millon hits per month, owns the biggest global multimedia platform for talent and talent seekers/agents who scout such communities to find the next big star. The company is now working to make India as its Asian hub for seeking talent.

Talking to TNS here today, Jatinder Singh, vice-president, of the company, said TalentTrove was started with true artists in mind. “From singing to advanced needlework, magic to sporting talent, we have categorised talent into 30 kinds of art. At TalentTrove, one can surround your uploaded talent with others sharing common interests. The web portal acts as a virtual stage/gallery/studio/TV station, where artists of every type, from anywhere, can get a real shot and meet some contacts and friends in the process,” he said.

He said they had decided to enter India because of its vast pool of untapped talent, growing online community and largest internet audience in the world.

He informed that of the $30 million investment in India, they were planning to raise $15 million through external borrowings, while the remaining would be invested through internal accruals. “We propose to create country-specific online talent communities in Asia. Those who upload their talent will be judged by a panel of eminent artistes, and the winners will be given a chance to be part of either our television shows or a part of film production,” he added. 

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Air India launches flights to NY, Chicago

Frankfurt, March 30
Air India, owned by National Aviation Co, has expanded its international operations with the launch of two daily flights from Mumbai and Delhi to New York and Chicago via here and opened a European hub at the Frankfurt Airport.

India's national air carrier's new US-bound flights, which left Mumbai and Delhi Saturday night, in accordance with the airline's new summer schedule, landed at the Frankfurt Airport on Sunday morning and continued their journey to New York (Newark) and Chicago after transferring their passengers travelling to different destinations in the US and Europe.

Shortly afterwards, flights from New York and Chicago stopped over at Frankfurt to enable passengers to board connecting flights for Mumbai and Delhi.

The carrier's new services to the US and Europe and the opening of its operational hub for west-bound flights in Frankfurt are part of a major initiative to strengthen the airline's global network by acquiring new aircraft, adding new routes and increasing the frequency of existing routes, Air India regional manager for Central Europe Ratan Bali said.

The launch of the new services doubles the total number of Air India's flights operating from Frankfurt to 28. This will be raised to 35 when Air India launches another daily service between Frankfurt and Ahmedabad, possibly in June, he said. — PTI 

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‘India Inc stops fresh hiring’

New Delhi, March 30
Indian corporates have virtually stopped fresh recruitments to cut costs in the wake of global credit crunch, says a study by industry body Assocham. Out of 150 Human Resource professionals interviewed, 90 per cent said: “There is a virtual ban on fresh recruitments in the private sector as attrition rate has almost subsided in all sectors of economy”.

The study said as the global slowdown was getting deeper, HR professionals were under severe pressure for working out innovative ways and means to cut unnecessary organisational frills and reduce fringe benefits such as bonus and other allowances, besides curtailment in administrative costs.

In order to avoid layoffs, HR professionals have advised managements to cut wages in the range of 10-15 per cent at middle and senior-middle levels and 25-35 per cent at senior levels, it said. — PTI

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Cap on wheat stock limit lifted
Tribune News Service

New Delhi, March 30
With abundant wheat in stock and bumper crop, the government on Monday decided to dispense with the wheat stock limit order, through which states can impose a cap on the quantity that traders can keep with them.

The Cabinet extended the notification which was to lapse on April 30 till September for pulses, leaving out wheat. It decided to extend the validity of Central orders on imposition of stock limits in respect of pulses, edible oils, edible oilseeds, rice and paddy for the period up to September 30. Home Minister P. Chidambaram said due to comfortable availability in case of wheat, the stock limit on commodity was being withdrawn.

In August 2006, the Centre had allowed states to put stock limit on wheat and pulses to check their spiraling prices. The notification, initially valid for six months, was being extended from time to time.

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BRIEFLY

SBI Gold Exchange Traded Scheme
Mumbai:
SBI Funds, a JV between the State Bank of India and France-based Societe General AMC, on Monday announced the launch of its SBI Gold Exchange Traded Scheme. The passively managed open-ended mutual fund would invest in gold and endeavour to track the price of the yellow metal. The new fund offer is open till April 28 and the net asset value (NAV) would be disclosed on every business day.

Allahabad Bank, UAE firm in pact for remittance facility
Kolkata
: City-based Allahabad Bank signed a pact on Monday with the Gulf-based money transfer and exchange house UAE Exchange and Financial Services for promoting its own money transfer services, the company said here. According to the bank's CMD K.R. Kamath, the association would "create enormous scope" for providing remittance facilities to the bank's customers and augmenting its fee-based income.

Rupee plunges 60 paise
Mumbai:
The Indian rupee today plunged by 60 paise to end below 51 to the greenback after a gap of six trading days, at 51.18/19, following a sharp decline in equity markets amid month-end dollar demand. A firm dollar overseas against its major rivals also put pressure on the rupee.

Eicher Motors net down 35%
New Delhi:
Eicher Motors on Monday reported a 35 per cent decline in its net profit for the October-December quarter. The company reported a profit after tax of Rs 11.65 crore in the third quarter as against Rs 15.76 crore in the corresponding period last fiscal. The company has declared a dividend of Rs 5 per, share subject to shareholder approval.

OBC opens office in Dubai
New Delhi:
Oriental Bank of Commerce opened its representative office in Dubai on Monday. The office was inaugurated by Arun Ramanathan, Finance Secretary, in the presence of Talmiz Ahmed, Ambassador of India to the UAE. Speaking on the occasion, Alok K Misra, CMD of the bank, informed that the office at Dubai was bank's first overseas establishment.

Source: Agencies, TNS

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