Reliance net up 41% at Rs 2403 crore
Supreme Court upholds verdict against Dalal
Sensex slides 135 on infotech selloff
Investors immature, feels BSE official
Bengal drive to reclaim unused industrial land
Infosys warming up for mobile commerce splash
Guj Ambuja Cement net surges to Rs 376 crore
Bengal drive to reclaim unused industrial land
Foreign Exchange, Bullion, Stock Indices

 
 
RELIANCE NET UP 41% AT RS 2403 CRORE 
 
 
FROM OUR CORRESPONDENT
 
Mumbai, April 18 
Cashing in on its usual strength of robust volume growth which was aided by higher product prices, Reliance Industries Ltd (RIL) beat market expectations to post a 41 per cent rise in net profits at Rs 2,403 crore against Rs 1,704 crore in the previous year.

Reliance Industries also became the first company in the domestic corporate sector to record a turnover of over Rs 20,000 crore: its sales turnover vaulted 39.5 per cent to Rs 20,301 crore from Rs 14,553 crore in the previous year.

The rise in both the topline and bottomline was far above market expectations, which had predicted a modest rise of around 30 per cent.

A significant contributor to the robust show was the improved performance in the fourth quarter. During this period, net profit jumped by 72 per cent to Rs 654 crore against Rs 381 crore, sales rose 83 per cent to Rs 6,594 crore as compared with Rs 3,607 crore in the corresponding period of the previous year.

“Apart from a strong volume growth and higher product prices, there was also a robust growth in domestic demand,’’ Anil D Ambani, RIL’s managing director, told newspersons here today. He added that the sales revenue growth was possible because of the positive impact of a 22.1 per cent growth in sales volume and a 17.4 per cent increase in product selling prices during the year.

Expressing optimism for the new fiscal, Ambani said the stability in the prices of crude oil (which is RIL’s key raw material) has provided some respite in terms of cost. He said there was a strong upside potential for product prices even though most items were below their peak 1995 levels. “We are optimistic about petrochemical prices and margins. Many people expect prices to firm up,’’ he said.

“With its expanded production capacities, the unique degree of integration, RIL will benefit significantly from the return of a greater measure of stability to feedstock prices and the improving outlook for the global and regional petrochemicals industry,’’ he added.

Talking about the company’s expansion plans, Ambani said capital expenditure in the the current fiscal had been fixed at Rs 1,000 crore. RIL has drawn up plans to double its existing polyester capacity over the next three years and enhance the capacity from its naphtha cracker to over 1 million tonnes of ethylene. The company is also contemplating to debottleneck the polyethylene and polypropylene plants.

On the Bombay Stock Exchange today, the Reliance scrip closed the day at Rs 298.50, gaining Rs 1.65.

During the year, RIL’s production volume was put at 8.92 million tonnes, an increase of 26 per cent. It has set a production target of 9.5 million tonnes for the current year.

Sales included inter-divisional transfers of Rs 4,454 crore, against Rs 3,929 crore whereas export revenues including deemed exports increased 164 per cent to Rs 1,811 crore. This included Rs 333 crore towards merchant exports, representing exports of products resulting from long term arrangement with Reliance Petroleum Ltd.

Telecom investment

Reliance Industries has lined up investments of around Rs 1300 crore in its basic and cellular ventures after identifying telecommunications as a major area for growth.

RIL managing director Anil D Ambani said today that in the area of basic telecom, the company has drawn up a capital expenditure programme of Rs 600 crore over the next 12-18 months in Gujarat.

The company is in the process of setting up a 3,000 km optical fibre backbone for the whole state which would be a “digital highway’’, he revealed.

This highway, according to Ambani, would be available for not only for internet, but also cable operators and other services.

Apart from the mammoth investment in basic services, RIL has plans to invest Rs 700 crore in the cellular business.    


 
 
SUPREME COURT UPHOLDS VERDICT AGAINST DALAL 
 
 
FROM R.VENKATARAMAN
 
New Delhi, April 18 
The Supreme Court today upheld the decision of the special court that stock broker Hiten P Dalal caused a loss of Rs 280.80 crore to the Standard Chartered Bank (SCB).

In a major judgment in the 1992 securities scam, a division bench of Justices B. N. Kirpal and R. P. Sethi said the bank is entitled to sell not only the original shares pledged with it but also to retain the dividends and interest accrued on them.

Dalal’s contention that the shares were ‘taken away forcibly from him’ was dismissed after Stanchart produced a letter that showed the shares had been pledged voluntarily.

“Stanchart’s claim that Dalal inflicted a loss of Rs 280 crore is upheld. Therefore, the ruling of the Special Court to award it Rs 30 lakh in costs cannot be regarded as incorrect,” the judges said.

The apex court treated a letter written by Dalal to Stanchart as a pledge admissible in a court of law. The letter, furnished in court by the bank, knocked the bottom out of his argument that the shares had been taken away from him forcibly.

“I am aware that you are in the process of reconciling your purchases/sales of government and other securities made through me. But, while the reconciliation is in progress, you have ascertained that purchases worth Rs 1,258 crore are not supported by deliveries of stocks and bank receipts,” stated Dalal’s letter, and a document that ended his legal options.

“We agree with the Special Court’s conclusion that Dalal’s argument about the shares being taken away from him forcibly is not correct,” the bench said.

The court also ordered that Cantriple units worth Rs 205 crore should be kept with the custodian till the claims to these instruments are settled.

However, the judges said the harsh observations made against the bank by the Special Court were justified. The special court had observed that Stanchart was creating false records and ‘in the greed for profits, was flouting rules and regulations laid down by the Reserve Bank of India’.

The fund diversions from banks and financial institutions to brokers’ accounts lay at the heart of the 1992 securities scam after which the Centre promulgated an Ordinance for the setting up of Special Courts to try the offences.    


 
 
SENSEX SLIDES 135 ON INFOTECH SELLOFF 
 
 
FROM OUR CORRESPONDENT
 
Mumbai, April 18 
A mild recovery was stifled by a selloff in infotech bellwethers today as the Bombay Stock Exchange (BSE) sensex slid another 135.24 points to close at 4745.47.

Market sentiment, strengthened in early-hour trading by Monday’s gains on the Nasdaq and Wall Street, flagged in the face of skittish operators and investors who swarmed select counters like Infosys, Satyam and Zee Telefilms — all index heavyweights — with sell orders.

What was different about today’s trading was that even old-economy stocks like Telco, Tisco, ACC, which had gained in Monday’s mayhem, also came under selling pressure. Broking circles attributed part of the selloff to redemption pressures faced by funds exposed heavily to new-economy shares.

In Monday’s trading on the Nasdaq, Infosys and Satyam Infoway registered gains of $ 2 and $ 1 respectively. However, this was not enough to build confidence in local tech stocks, a dealer said.

Analysts said the market is in a phase of consolidation and ruled out any possibility of the sensex falling below the support level of 4600.

A rally on most East Asian bourses, including Hang Seng’s 515 point surge in Hong Kong and mild 30-point loss in Tokyo’s Nikkei index, has raised hopes of a rebound in local markets on Wednesday.

Also, the fact that FIIs pumped in Rs 2226.4 crore this month will fortify the feel-good factor and dispel pessimism.

In the specified group, six counters, including four index heavyweights like ITC, Telco, Zee Telefilms and Satyam Computers, were locked in their lower-end circuit filters at the close.

Unlike yesterday, the volume of business was good at Rs 3150.36 crore. Himachal Futuristic (HFCL) was the most active scrip with a turnover of Rs 757.11 crore followed by Satyam Computer (Rs 298.18 crore), Infosys Technologies (Rs 286.65 crore), Zee Telefilms (Rs 251.95 crore) and Reliance (Rs 213.22 crore).    


 
 
INVESTORS IMMATURE, FEELS BSE OFFICIAL 
 
 
FROM OUR CORRESPONDENT
 
New Delhi, April 18 
The bloodbath on the country’s major bourses yesterday was because of immature investors who could not differentiate between the fundamentals of the two exchanges—the Bombay Stock Exchange (BSE) and the Nasdaq, according to a senior official of the BSE.

Reacting to the ripple effect on the stock exchanges in India, BSE director (corporate development) Manoj Vaish said, “Indian companies have registered on the Nasdaq only recently. Hence any movement there—upward or downward—will influence our stock exchanges. This is because our investors are immature and can’t differentiate the fundamental of one economy from the other.” With time the rebound effect will diminish considerably, he added.

Spelling out the exchange’s future agenda, Vaish said trading in index futures, based on sensex, will begin by May and derivatives trading initiatives will be taken at strategic international exchanges.

Other plans of BSE include, rolling settlements in all stocks, carryforward facility in rolling settlement, Indian depository receipts and market-making in illiquid scrips.    


 
 
BENGAL DRIVE TO RECLAIM UNUSED INDUSTRIAL LAND 
 
 
BY A STAFF REPORTER
 
Calcutta, April 18 
The West Bengal government has reclaimed unutilised land from 12 entrepreneurs in the Salt Lake and EM Bypass areas and also issued notices to those who are yet to set up industries on the land allotted to them. Addressing members of the Merchants’ Chamber of Commerce (MCC), Ashok Bhattacharya, the municipal affairs and urban development minister, said that these lands will be re-allotted to other aspiring entrepreneurs.

“The land has been kept unutilised for over 10 years. Some allottees are yet to submit the project plan. Some government undertakings had applied for land but did not show further interest. Already there is a shortage of land in and around Calcutta. So we have taken the land away from them,” Bhattacharya said. Regarding the validity of the transfer of the lease-hold land in Salt Lake to free-hold land, the minister said, “We are against this sort of transfer. But we are examining the conversion policy that has been adopted by the Delhi Development Authority.”    


 
 
INFOSYS WARMING UP FOR MOBILE COMMERCE SPLASH 
 
 
FROM VIVEK NAIR
 
Mumbai, April 18 
After consolidating its strength in e-commerce, Infosys Technologies Ltd, the information technology major, has now turned its attention towards M-Com (mobile commerce) in order to tap the convergence boom.

Senior officials from the company said Infosys was now moving towards providing the software for third generation wireless activities.

“The third generation of wireless will provide the transfer of both data and voice as an integral platform. We are aggressively looking at that segment, for which the company is working with leading solutions providers,” Rajiv Kuchhal, who heads Infosys’ telecom activities, told The Telegraph.

Kuchhal said Infosys has decided to concentrate only on providing the required software needs for various companies in the areas of both wireless and broadband. “Infosys has primarily been in the services business as a solution provider. We would therefore service the software needs of companies, staying completely out of the hardware segment,” the official added.

That Infosys was giving prime importance to the telecom sector, sources said, could be gauged from the fact that around 700 staff are working on different projects, providing solutions to several clients. Infosys has already projects from notable companies, including Nortel.

Though company officials refused to set a revenue target from this business for the current fiscal, sources said it could touch around 18 per cent.

For the current year, Infosys has maintained its growth target at around 55 per cent compared with the projected industry growth of 45-50 per cent.

A significant chunk of this growth will come from the company’s traditional strength in customised software application development, maintenance and re-engineering services apart from e-commerce and telecom.    


 
 
GUJ AMBUJA CEMENT NET SURGES TO RS 376 CRORE 
 
 
FROM OUR CORRESPONDENT
 
Mumbai, April 18 
An extraordinary income of Rs 221.69 crore boosted the net profits of Gujarat Ambuja Cements Limited for the first nine months of the fiscal year ending June, 2000 to Rs 376.03 crore as against Rs 92.73 crore in the corresponding period of the previous year. In a press statement issued today, the company said it is continuing with its drive to par costs which has helped it ratchet up profits during the year. Net profit for the nine months from the ordinary course of the business is substantially higher at Rs 154.34 crore as against Rs 92.73 crore, an increase of 66 per cent.

The profit has been arrived after charging interest of Rs 66.94 crore (Rs 81.76 crore for the previous period) and depreciation of Rs 92.62 crore as against Rs 90.04 crore last year.

For the period under review, the company incurred tax of Rs 25 lakh as against Rs 62 lakh in the previous period.

Explaining the huge jump in net profits, the company said the extraordinary income of Rs 221.69 crore after a tax of Rs 27.40 crore was on account of profit from the sale of shares of Ambuja Cement Eastern Limited. After including thus extra-ordinary income, the net profit for the nine month period is Rs 376.03 crore as against Rs 92.73 crore in the previous period.

During the first nine months, the company produced 41.25 lakh tonnes of clinker as against 37.79 lakh tonnes in the previous period. Total sales of cement including clinker during the first nine months amounted to 42.01 lakh tonnes as against 42.11 lakh tonnes in the previous period.    


 
 
BENGAL DRIVE TO RECLAIM UNUSED INDUSTRIAL LAND 
 
 
BY A STAFF REPORTER
 
Calcutta, April 18 
The West Bengal government has reclaimed unutilised land from 12 entrepreneurs in the Salt Lake and EM Bypass areas and also issued notices to those who are yet to set up industries on the land allotted to them. Addressing members of the Merchants’ Chamber of Commerce (MCC), Ashok Bhattacharya, the municipal affairs and urban development minister, said that these lands will be re-allotted to other aspiring entrepreneurs.

“The land has been kept unutilised for over 10 years. Some allottees are yet to submit the project plan. Some government undertakings had applied for land but did not show further interest. Already there is a shortage of land in and around Calcutta. So we have taken the land away from them,” Bhattacharya said. Regarding the validity of the transfer of the lease-hold land in Salt Lake to free-hold land, the minister said, “We are against this sort of transfer. But we are examining the conversion policy that has been adopted by the Delhi Development Authority.”    


 
 
FOREIGN EXCHANGE, BULLION, STOCK INDICES 
 
 
 
 
Foreign Exchange
US $1	Rs 43.64	HK $1	Rs 5.55*
UK £1	Rs 69.06	SW Fr 1	Rs 26.05*
Euro	Rs 41.50	Sing $1	Rs 25.30*
Yen 100	Rs 41.90	Aus $1	Rs 25.50*
*SBI TC buying rates; others are forex market closing rates

Bullion

Calcutta		Bombay
Gold Std (10gm)	Rs 4520	Gold Std (10 gm)	Rs 4500
Gold 22 carat	Rs 4270	Gold 22 carat	Rs 4160
Silver bar (Kg)	Rs 7925	Silver (Kg)	Rs 8125
Silver portion	Rs 8025	Silver portion	Rs 8130

Stock Indices

Sensex	4745.47	-135.24
BSE-100	2566.19	-28.75
S&P CNX Nifty	1414.80	-28.75
Calcutta	120.07	-0.77
Skindia GDR	NA	NA
   
 

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