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THE TRIBUNE SPECIALS
50 YEARS OF INDEPENDENCE

TERCENTENARY CELEBRATIONS
B U S I N E S S

Down 435: Sensex registers big fall
Mumbai, June 17
After a brief mid-session recovery, sluggish European stocks and sustained sell-off by foreign funds today dragged the market down with the benchmark Sensex plunging by 435 points, registering the fourth-biggest single-day fall of the year.

Jet, Kingfisher hike air fares
New Delhi/Mumbai, June 17
Air travellers will have to shell out more for their tickets from today with Jet Airways, Kingfisher Airlines and their no-frill subsidiaries hiking fuel surcharge by Rs 400 each on all domestic sectors and Air India indicating it will soon follow suit. The rise in fuel surcharge came in the wake of a 33 per cent increase in the prices of air ATF over the past three months, the airlines said.

Punjab: New SEZ Act on anvil
Chandigarh, June 17
Punjab will bring out an act in the forthcoming Budget session to promote special economic zones (SEZs) in consonance with the ground realities in the state. While the state wants to facilitate SEZ promoters by giving them the facility of single-window clearance, it also wants to take up the issue of lowering the amount of land necessary to create SEZ.



EARLIER STORIES



Fiat launches Grande Punto
New Delhi, June 17
Fiat Grande Punto car at its launch in New Delhi on Wednesday Looking to grab a share from the hatchback segment in the country, Italian car major Fiat today launched its much-awaited premium small car Grande Punto. With plans to position the car in the premium hatchback segment along with Maruti Suzuki's Ritz, Hyundai's i20, Skoda's Fabia and just launched Honda Siel's Jazz, the company has come out with the model in both petrol and diesel variants priced between Rs 3.99 lakh and Rs 6.11 lakh (ex-showroom, Delhi).

Fiat Grande Punto car at its launch in New Delhi on Wednesday. Tribune photo: Mukesh Aggarwal

RNRL may intervene in RIL-NTPC case
Mumbai, June 17
Close on the heels of the Bombay High Court's gas supply judgment in its favour, Anil Ambani group firm Reliance Natural Resources Ltd (RNRL) is all set to intervene in another case related to gas supply between Mukesh Ambani-led RIL and state-run power producer NTPC.

HC to decide on amendment plea
The Bombay High Court today said it would decide whether to allow RIL to amend its plea in its suit with NTPC on the gas supply contract after two weeks.

MFs should step up retail participation: Sebi chief
Sebi chairman CB Bhave at the Mutual Fund Summit 2009 in Mumbai on Wednesday.Mumbai, June 17
In a bid to increase retail participation in the stock markets, the Security Exchange Board of India (Sebi) is urging asset management companies (AMCs) that own various mutual funds (MFs) to concentrate on the retail investor instead of corporate houses.

Sebi chairman CB Bhave at the Mutual Fund Summit 2009 in Mumbai on Wednesday. — PTI

Havells target: Rs 500 cr exports from Baddi unit
Baddi, June 17
Consolidating its switchgear manufacturing unit at Baddi, Havells India Limited today announced plans to perk up its investments to Rs 150 crore here with the initiation of an export-oriented unit. It is the second unit of the group in Baddi.

DLF Pramerica Life Insurance eyes small cities
Ludhiana, June 17
DLF Pramerica Life Insurance Co — a joint venture between DLF Limited and Prudential International Insurance Holdings Ltd - has started expanding its footprint in Punjab with the opening of new branches in Patiala, Ludhiana and Amritsar.





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Down 435: Sensex registers big fall

Mumbai, June 17
After a brief mid-session recovery, sluggish European stocks and sustained sell-off by foreign funds today dragged the market down with the benchmark Sensex plunging by 435 points, registering the fourth-biggest single-day fall of the year.

The bellwether index had fallen by 749.05 points on January 7, 480.35 points on March 30 and 437.63 points on June 8 this year.

In a high level of volatility, the Bombay Stock Exchange settled the day at a two-week low of 14,522.84, netting a fall of 435.07 points or 2.91 per cent from its previous close.

The Sensex touched the intra-day low of 14,447.02.

The market spiralled downwards in afternoon trade as European stocks extended losses to a fourth day after a sharp fall in the American market yesterday.

The dramatic selling pressure surfaced after a leading brokerage Kotak Securities reportedly lowered RIL's rating.

SMC Capitals Equity head Jagannadham Thuguntla said: “The market is showing signs of fatigue because of valuation concerns; besides, there is a apprehension that the Budget may not have that many sweeteners.”

Market sentiment also was adversely affected by sustained pullout by foreign institutional investors, which were believed to be aggressive sellers during the day.

The broader 50-share Nifty of the National Stock Exchange also tumbled by 161.65 points or 3.58 per cent to close at 4,356.15 from its last close.

FIIs sold shares worth about 1,140 crore in the last two days after their aggressive purchases since May.

Except Shanghai Composite and Nikkei, other Asian indices ended in the red, extending losses to the fourth straight day.

Selling was so intense and widespread that the smallcap and the midcap indices too fell by 3.74 per cent and 3.92 per cent, respectively.

India's largest private sector firm Reliance Industries dropped by 4.24 per cent.

Other major losers include Tata Steel (7.52 per cent), Tata Motors (7.36 per cent), Jaiprakash Associates (6.28 per cent), Reliance Comm (5.92 per cent), DLF (5.66 per cent), ONGC (5.36 per cent), Hindalco (5.25 per cent), Sterlite (4.89 per cent), NTPC (4.68 per cent), Wipro (4.62 per cent), Ranbaxy Lab (4.42 per cent) and L&T (3.93 per cent).

Of the 30 shares in the Sensex pack, only Tata Power ended in the green with a minor upside variation.

The market breadth was extremely negative with 1,990 stocks showing losses while 686 others finished with gains. — PTI 

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Jet, Kingfisher hike air fares

New Delhi/Mumbai, June 17
Air travellers will have to shell out more for their tickets from today with Jet Airways, Kingfisher Airlines and their no-frill subsidiaries hiking fuel surcharge by Rs 400 each on all domestic sectors and Air India indicating it will soon follow suit. The rise in fuel surcharge came in the wake of a 33 per cent increase in the prices of air ATF over the past three months, the airlines said.

For Jet Airways, the hike would take the total fuel surcharge on a ticket below a distance of 750 km to Rs 2,450 and beyond that to Rs 3,400. For its no-frill subsidiaries Jet Airways Konnect and JetLite, it would be Rs 2,150 and Rs 3,100 respectively.

A Kingfisher Airlines spokesperson said the hike would apply uniformly for flights across all distances and all classes of travel, including subsidiary Kingfisher Red.

The increase has been made effective by all these carriers for bookings from today.

An Air India spokesperson said: “We are also seriously contemplating an upward revision in fuel surcharge in view of the continuous increase in ATF prices” and a decision was expected in a couple of days.

Air India currently levies fuel surcharge of Rs 1,950 and Rs 2,700 on air tickets up to and beyond 750 km respectively.

Officials of no-frill carriers IndiGo, SpiceJet and GoAir were mulling their options saying they were yet to take a decision. These carriers currently charge Rs 2,000 as surcharge.

The increase in fuel surcharge comes following an over 12 per cent rise in ATF prices by state-run oil firms on June 15 and over 33 per cent since March. The international crude oil prices have firmed to a seven-month high of $72 per barrel on hopes of demand revival in the US. — PTI 

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Punjab: New SEZ Act on anvil
Jangveer Singh
Tribune News Service

Chandigarh, June 17
Punjab will bring out an act in the forthcoming Budget session to promote special economic zones (SEZs) in consonance with the ground realities in the state.

While the state wants to facilitate SEZ promoters by giving them the facility of single-window clearance, it also wants to take up the issue of lowering the amount of land necessary to create SEZ.

Industries principal secretary SS Channy said there was a demand for SEZs, but investors were disappointed due to costly land and difficulty in hiring large chunks.

He said recently the state had received a demand for establishing two food processing SEZs at Amritsar and Rajpura. He said the promoters, however, had only 10 hectares each in their possession and wanted their projects to be cleared.

Salient features of the proposed SEZ Act provides for the notification of the SEZ by the state after the approval by the Centre.

At present, the Centre notifies the projects after they have been approved by the state. The state has approved 18 SEZs, but the Centre has approved only 16. Out of these, the Centre till now has notified only two projects of Quark City with proposed investment of Rs 500 crore in Mohali and Ranbaxy-sponsored pharma SEZ with an investment of Rs 260 crore.

At present, SEZ developers have to take permission from revenue, town planning and other departments separately. Under the proposed act, promoters will apply to the Industries Department that will circulate the application to the departments concerned. Following it, case of approval will come up before the project approval committee.

The committee can give in-principle approval to the project even if the land is not in the possession of the promoter and final approval will be given after land possession.

The act also proposes exempting the SEZs from stamp duty, registration fee and social security cess on purchase of the land. All SEZ units will be given public utility status under the proposed act. The new act also provides for provisions to override other state laws.

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Fiat launches Grande Punto
Tribune News Service

New Delhi, June 17
Looking to grab a share from the hatchback segment in the country, Italian car major Fiat today launched its much-awaited premium small car Grande Punto.

With plans to position the car in the premium hatchback segment along with Maruti Suzuki's Ritz, Hyundai's i20, Skoda's Fabia and just launched Honda Siel's Jazz, the company has come out with the model in both petrol and diesel variants priced between Rs 3.99 lakh and Rs 6.11 lakh (ex-showroom, Delhi).

“The launch of Grande Punto marks a new milestone for Fiat in India as we bring the quintessentially Italian designs to Indian shores,” Fiat India Automobiles Ltd (FIAL) chief executive officer Rajeev Kapoor said.

Grande Punto, which was first launched in the European market in 2005, would be rolled out from the company's plant at Ranjangaon in Maharashtra in four variants each in both petrol (1.2 litre an 1.4 litre) and diesel modes (1.3 litre).

The petrol variants would cost Rs 3.99-5.61 lakh, while the diesel cars would be offered at Rs 4.85-6.11 lakh. FIAL, a 50:50 joint venture between Italy-based Fiat SpA and domestic auto major Tata Motors, believes that the small-car segment is under-tapped and customers are increasingly looking forward to international brands on Indian roads.

The company officials said with competitive pricing and backing of Tata’s in after-sale service, the model would be able to grab a share for itself in the hatchback segment. Grande Punto would be retailed through over 100 Tata-Fiat dealers network across the country.

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RNRL may intervene in RIL-NTPC case

Mumbai, June 17
Close on the heels of the Bombay High Court's gas supply judgment in its favour, Anil Ambani group firm Reliance Natural Resources Ltd (RNRL) is all set to intervene in another case related to gas supply between Mukesh Ambani-led RIL and state-run power producer NTPC.

“RNRL will intervene in the RIL-NTPC High Court matter,” a source familiar with the matter said.

Earlier this week, the Bombay High Court asked RIL to honour a 2005 family agreement to supply 28 million cubic meters per day of gas from its Krishna-Godavari basin fields at $2.34 per mmBtu for 17 years to RNRL.

As per the ruling, RIL has been asked to supply gas at a price 44 per cent lower than rates approved by the government.

The price for RNRL was derived from the 2004 agreement between RIL and NTPC. However, this RIL-NTPC contract is also a subject matter of case before another bench of the Bombay High Court as RIL has said the contract was not concluded.

Amid the two legal battles, the government has referred the pricing formula to empowered Group of Ministers (EGoM), which notified a price of $4.20 per mmBtu.

The Bombay High Court, in its interim order, had allowed RIL to sell gas at EGoM notified price but subject to the final ruling in the case.

RNRL’s decision to become party to RIL-NTPC case assumes significance as the MoU between RIL and RNRL specified that the terms for RIL-RNRL contract should not be less favourable than that of NTPC.

The court, in its ruling earlier this week, also upheld RNRL’s stand that under the MoU, terms of RIL-NTPC contract (which was entered into before demerger) would be a “general guidance” for RIL-RNRL contract. — PTI

HC to decide on amendment plea

The Bombay High Court today said it would decide whether to allow RIL to amend its plea in its suit with NTPC on the gas supply contract after two weeks.

RIL and NTPC negotiated a contract for supplying gas from RIL's KG basin reserves in 2003-04, but RIL later took the stand that the contract was not yet concluded.

NTPC then moved High Court, saying the contract was sewn up, and RIL should implement it.

Supposedly RIL is supposed to supply 12 mmscmd of gas to NTPC at USD 2.34 per mmBtu for 17 years.

RIL now wants to amend its petition to take a fresh stand that even if it had a valid contract with NTPC, because of the government's latest decisions regarding KG basin gas, the contract would be "frustrated".

The Central government had filed an affidavit in the high court in the RIL-RNRL case in January, stating the decisions of the Empowered Group Of Ministers on KG gas pricing and allocation.

The EGoM had said KG basin gas won't be sold for less than $4.20 per mmBtu. RIL wants to rely on this affidavit in its case with NTPC. — PTI

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MFs should step up retail participation: Sebi chief
Shiv Kumar
Tribune News Service

Mumbai, June 17
In a bid to increase retail participation in the stock markets, the Security Exchange Board of India (Sebi) is urging asset management companies (AMCs) that own various mutual funds (MFs) to concentrate on the retail investor instead of corporate houses.

SEBI chief CB Bhave warned AMCs that excessive reliance on corporate investors could leave them susceptible to redemption pressures. “I think the industry must learn this lesson seriously. If you rely on corporate money to build your assets under management?, you are making a mistake because corporate under given circumstances will tend to give all in one direction. Either they will all pour money into a scheme or they will all want to withdraw?,” Bhave said at the CII Mutual Fund summit here today.

Mutual funds, he said, should concentrate on liquid and individual-oriented portfolios. “They must go to the retail investor because that is what they need. It is in their interest that retail investors have a larger portion of their scheme,” Bhave said.

HE further added that the stock market regulator was also pushing for a strong debt market in the country. Debt markets, Bhave said, needed to become more liquid. “There is a need to make more efforts to see that, if not exactly equity markets, we get them somewhere on that path and make sure that we are able to generate the same confidence in the debt markets that exists in the equity markets today.”

Meanwhile, SEBI will hold its board meeting on Thursday to decide on a number of important issues pertaining to capital markets.

The body is likely to arm itself with more teeth and emerge as a judicial body to police the stock markets.

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Havells target: Rs 500 cr exports from Baddi unit
Ambika Sharma

Baddi, June 17
Consolidating its switchgear manufacturing unit at Baddi, Havells India Limited today announced plans to perk up its investments to Rs 150 crore here with the initiation of an export-oriented unit. It is the second unit of the group in Baddi.

Sunil Sikka, president, Havells India Limited, said this while interacting with the media here today. Optimistic of the market, which had earlier suffered a slowdown in the housing sector, he said with 67 per cent hike in the capacity, a proportionate hike was expected in the revenue. He did not disclosed growth for the last fiscal.

Sikka, however, added that the sudden meltdown of metals in terms of value in October last year had impacted total revenue growth though results of March 2009 were better than that of the corresponding period last year.

The group estimated to touch a target of Rs 500 crore in exports in a period of three years while expecting a 50 per cent growth in its domestic markets as well. This expansion is slated to generate five crore poles per annum of domestic switchgear from the present three crore.

Terming the prevailing recession as beneficial to developing nations, company president opined that the phase had provided ample business opportunities to countries like China and India as business had shrunk in the developed nations owing to high manufacturing costs. 

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DLF Pramerica Life Insurance eyes small cities
Shivani Bhakoo
Tribune News Service

Ludhiana, June 17
DLF Pramerica Life Insurance Co — a joint venture between DLF Limited and Prudential International Insurance Holdings Ltd - has started expanding its footprint in Punjab with the opening of new branches in Patiala, Ludhiana and Amritsar.

Maninder Sood, senior vice-president (head, agency sales), DLF Pramerica Life Insurance, said the company was interested in targeting small cities like Pathankot, Ferozpur, Faridkot, Batala, Jagraon and Moga as such cities were ignored and masses could not be made aware on life insurance policies by many companies.

“Since our foray into Punjab early this year, customers’ response to DPLI’s products has been encouraging and we are confident of building on this momentum. Our aim is to make customers understand that the primary role of life insurance is protection and not just investment. Therefore, the advice we give them is geared towards helping them make the best decisions to achieve long-term financial security, for themselves and their families,” he said.

DLF Pramerica Life Insurance has developed several flexible life insurance and pension products, including DLF Pramerica Wealth+ and DLF Pramerica Golden Age — a unit-linked pension plan with many advantages like built-in safety measures to help safeguard individual’s retirement investments, Sood said. 

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BRIEFLY

IOC wins Readers Digest award
NEW DELHI
: IndianOil has been adjudged the ‘Most Trusted Brand’ in the petrol station category in the country in a survey by Readers Digest in collaboration with the reputed research house Nielsen Media Research. The award was received by HS Bedi, executive director (retail sales), IOC. The emphasis of the survey was on trust as the key attribute in the customers’ relationship with the brand. — TNS

Max to sell stake to New York Life
NEW DELHI:
Max India on Tuesday said it would sell additional 23 per cent in Max New York Life to its life insurance venture partner New York Life, subject to regulatory condition. "It is clearly agreed and understood between New York Life and us that Max India will sell, subject to FDI guidelines, a 23 per cent stake in Max New York Life to NYL," said Max (India) chairman Analjit Singh. Currently, NYL holds 26 per cent in Max New York Life. As per the present regulatory guideline a foreign partner cannot have more than 26 per cent in an insurance venture. — PTI

Rupee tumbles 39 paise
MUMBAI:
The rupee on Wednesday closed above the crucial 48 level against the dollar for the first time in five weeks in tandem with a sharp slide in local stocks, raising fears of capital outflow from equity. Resuming lower at 47.84/85 a dollar, the domestic unit later moved in a range of 48.16 and 47.81 before ending the day at 48.13/14 against the dollar, cheaper by 39 paise from its last close of 47.74/75 a dollar. — PTI

SS ChopraAppointed
CHANDIGARH
: SS Chopra, circle head, Punjab National Bank (Chandigarh circle) and deputy general manager, field GM office, Chandigarh, has been promoted as field general manager, patna. He has vast experience in various fields of banking and served PNB in various capacities. — TNS

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