City cellular twins on dues trail
Strike call to jam telecom corporatisation
Reliance sets sights on JCT polyester unit
Accor set to check in at Great Eastern
Consolidators to replace A-I general sales agents
Sensex gains 73 points on local, FII buying
Computech plans Rs 47 cr private placement
Foreign exchange, Bullion, Stock Indices

Calcutta, June 19 
The city’s cellular service providers are joining forces to get truant subscribers to cough up their bills.

Usha Martin Telekom (which provides service under the Command brand name) and Modi Telstra (MobileNet), the two companies which have had no love lost for each other in their long-running turf war, have built up a common front in the battle against customers who dodge payments.

The increase in outstanding arrears from people who the companies call ‘unscrupulous subscribers’ has gnawed away at their revenues, and they feel this gives them strong reasons to cast their professional rivalries aside and fight defaulters who are threatening the viability of their operations and putting a question mark on the credibility of all subscribers.

Confirming the development, Command’s vice-president (business operations) S. Chowdhury said the two cell-phone providers — which have 1,11,000 customers between them — have decided to share information on defaulting customers. They hope it will prevent subscribers who do not pay up from switching firms to dodge their bills.

Chowdhury refused to disclose the exact amount of the outstanding arrears, but indicated that it would run into crores if the books of two companies were taken into account. Of the 1.1 lakh subscribers who use the services of the two companies, around 12,000 have defaulted on payments.

“This problem exists in other cities, but it is more acute and peculiar to this city. What the defaulters do not realise is that non-payment of dues affects the credibility of all subscribers at large and makes companies cautious in taking new customers on board,” Debashis Sur, general manager, (customer care) of Modi Telstra, toldThe Telegraph. Already, there are signs that the defaults have made companies wary. Command, for instance, has also devised a ‘credit verification system’ to assess the credit-worthiness of subscribers.

“This does not mean that we are delaying new connections. We are giving them as soon as we get the applications. But, we send our people to customers’ houses. We give the services on the basis of the reports they file about the prospective subscriber,” says Chowdhury. The company, he said, can discontinue services or stop providing STD and ISD facilities if the financial position of the applicant is not ‘encouraging.’

Modi Telstra, the company with a larger customer base of 61,000 compared with UMTL’s 50,000, has gone a step further — it is now commissioning specialised agencies to recover dues.

“We send bills once a month. Customers have 15 days to pay up. If they fail to do so, a tele-calling agency takes the charge of reminding them about the payment,” Sur said, adding the services of ‘chase agencies’ are requisitioned if all these efforts to persuade defaulting subscribers to clear their bills do not succeed.

Then, there is the legal option — something both companies are doing now — to recover their money. To tackle the problem better, the two cellular service providers are contemplating a wider information network in which the credit profile of a particular person is readily available.

“We are talking to the credit card, car and housing finance companies to get them to share the information they have about customers — many of whom also use mobile services —with us.

“The network will ensure that a person who defaults on his phone bills finds all doors closed on him,” Sur said.    

New Delhi, June 19 
The Union minister of communications Ram Vilas Paswan is likely to face a stormy reception when he returns from a US trip on Thursday. The joint action committee of associations & unions of Indian telecom sector has called a nationwide strike on June 28.

The committee is protesting against the proposed corporatisation of department of telecom services (DTS).

The striking employees have rejected the claim by Paswan that the free phone has been offered after a compromise was reached between the unions and the government.

O. P. Gupta, the chief convenor of the agitation and president of National Federation of Telecom Employees (NFTE) said, “There was no agreement between us and the government about corporatisation. When the issue of free telephone and bonus was raised by the finance minister with the Prime Minister, the communications minister, we believe, had said that the agreement was finalised in consultations with the unions. He had also agreed to complete the corporatisation within four months.”

“In order to remove any misunderstanding on the terms of the agreement, on behalf of the three federations, we have asked the DTS to treat the agreement as cancelled and negotiate on the issue of bonus. We had not agreed for reduction in three days bonus in lieu of corporatisation,” he added.

Meanwhile, a senior official in the department of telecommunications said, that the minister has been briefed about the developments and is expected to meet the unions on June 23.

According to the joint action committee, the basic issues of job security and pension are yet to be resolved. Further, the recommendations of the Fifth Central Pay Commission is still pending with the government.

“What will happen to these two issues? Once the DTS is corporatised, all of us will technically retire and re-recruited. Then we will not be able to go for any arbitration. So we have decided that if the government fails to spell out about these two issues we may go for arbitration,” said Gupta.

The committee also claimed, that while today DTS is under staffed, a corporatised DTS may declare surplus staff, if it decides to do away with some of the functions.

“Today we have 22 employees per 1000 subscribers from 120 employees per 1000 subscribers in 1983. So there is no question of surplus today. But if tomorrow a corporatised DTS decides to privatise a few functions performed by class three and four employees, the question of surplus will automatically come up,” cautions Gupta.    

Mumbai, June 19 
Reliance Industries Ltd is on the prowl again. Not content with a huge polyester capacity of around 8 lakh tonnes per annum, the giant is believed to be in negotiations with the Thapars of JCT Ltd to acquire the latter’s polyester capacity of over 50,000 tonnes.

Industry sources said while talks between the two companies have been on for some time now, a deal is likely to be consummated within the next couple of months. The move to acquire JCT’s capacity is widely being seen as part of Reliance’s plan to raise its polyester capacity to more than 1 million tonnes annually. RIL had, in the previous year, announced its intention to raise its total polyester capacity in phases over the next three years through a combination of acquisitions, fresh capacity creation and de-bottlenecking of existing capacities.

However, when contacted, a Reliance spokesperson pointed out that it was not the company’s policy to ‘comment on market speculations.’

JCT Ltd, which is an M. M. Thapar group company, also has a nylon fibre yarn capacity of 8,000 tonnes in addition to a recognised suitings brand. The company, which is restructuring its activities, had earlier initiated discussions with the Polysindo group of Indonesia for the sale of its polyester plant based in Rajasthan. However, the talks fell through.

The acquisition of JCT’s polyester capacity by Reliance, if it does take place, would be the fifth such take-over in the polyester segment after the likes of producers like Raymond Synthetics, India Polyfibres, Orissa Synthetics and DCL Polyesters.

While these acquisitions have made RIL a clear leader in the segment, its polyester yarn capacity alone has risen to 3.60 lakh tonnes from 3.20 lakh tonnes. With the addition of DCL’s facilities, Reliance has become the fourth largest producer of polyester fibre yarn in the world and its local market share has risen over 38 per cent. Industry circles aver that with the increase in its capacity to more than 1 million tonnes, the company would command more than a 50 per cent share of the country’s polyester market.

A major advantage for RIL is that it is the only fully integrated producer with captive supplies of all key raw materials, including paraxylene, purified terephthalic acid (PTA) and mono-ethylene glycol (MEG). The company now plans to bring about a corresponding increase in capacities of feedstocks such as PTA and MEG besides focusing on enhancing the production of speciality polyester products.    

Calcutta, June 19 
The West Bengal government has taken an in-principle decision to hand over Great Eastern Hotel to French company Accor Asia Pacific.

Accor has presented the state government a package for the planned takeover. The firm says it is ready to take the hotel on a Rs 1-crore lease for a period that is now being finalised by the state government. However, not all the 450 employees will be retained by the company which, sources say, is ready to invest Rs 15 crore in a voluntary retirement scheme. “Majority of the workers will be offered a VRS. The company will retain very few people,” the sources added.

Accor will clear the hotel’s dues, which include arrears in income tax, sales tax and electricity charges. These payments will be adjusted with the state government at an unspecified time in future.

Sources said the four-member committee set up by the state government to look into the privatisation of the Great Eastern Hotel is considering the different options in which the adjustments could be achieved.

The government has said it is committed to take immediate steps to revive Great Eastern, but it has done precious little so far. “We have been told that a final decision will be taken after the municipal elections are completed,” employees said. However, neither the state government nor Accor Asia Pacific has held talks with the employees on privatisation.

As the privatisation process at one the city’s oldest hotels limp ahead, its business has taken a beating. The occupancy rate has fallen to a poor 10-20 per cent, the sources said.

In the last few years starting 1993-94, the hotel has been suffering massive operational losses; accumulated losses on March 31, 1998 had piled up to Rs 3.57 crore. In the absence of any fixed and working capital, the hotel is meeting all types of expenditure, including development expenditure, from day-to-day earnings and cash credit raised from Uco Bank and Central Bank of India against its fixed deposits. Salaries are being paid from grant-in-aids given by the state government.

“If business deteriorates at the current rate, it may increase financial difficulties and lead to the closure of the hotel. We have written several times to state tourism minister Manab Mukherjee to hold a discussion on the present condition of the hotel but, he has not done so till now. In the meantime, the hotel is being renovated by the government. We are all extremely confused,” the employees said.    

New Delhi, June 19 
In order to widen its marketing base, Air-India today decided to replace the network of general sales agents (GSAs) with consolidators in important markets to have more transparency in the marketing policy.

“This exercise will be carried out in stages after conducting a cost-benefit analysis keeping local laws in mind,” said a spokesperson for the airline.

In order to ensure continuity, the present GSAs would be considered as consolidators, she said.

This decision has been taken based on the recommendations by the parliamentary committee on public undertakings which had sought a review of Air-India’s policy on appointments of GSAs. The airline has been asked by committee to adopt established procedures for periodic appointment of such agencies.

The eligibility criteria for the consolidators would be announced shortly. It would be based on revenue potential, market size and agent characteristics.

With the appointment of consolidators Air-India will directly save three per cent overriding commission which is currently being paid to GSAs, besides a wider market coverage and consequent increase in its market share.

The airline will be able to market net fares bringing in more transparency. The appointment of more than one consolidator in each territory will help protect consumer interest, offer competitive fares and ensure that unreasonable premiums are not charged from the consumer.

The airline had earlier appointed GSAs to secure business from International Air Travel Association (IATA) and non-IATA agents in markets where agency network were yet to get fully automated. Also, the airline needed financial security to cover business risks.

Leasing deferred

Air-India has put off by a day the opening of the financial bids for the lease of Airbus and Boeing aircraft.

“One member of the committee set up for this purpose, which includes the commercial, engineering and finance directors, was not available today and hence we have put it off till 1600 hours tomorrow,” AI sources said here.    

Mumbai, June 19 
Profit booking by local operators and investment funds towards the end of the session today stonewalled an impressive rally in front-line ICE and other old-economy stocks. As a result, the 30-share BSE sensex retracted from its highs and closed at 4837.24, still a gain of 72.57 points.

Earlier in the day, several new economy stocks, including HFCL, Satyam Computers, Zee Telefilms, led a rally on buying by operators and foreign institutional investors that saw the sensex breaching the crucial 4,800 level.

Brokers said that the renewed buying interest in these stocks were due to positive expectations about the forthcoming first quarter results. Market feels that though the bourses can be volatile as it is the last day of settlement at the National Stock Exchange, the bull-run is likely to continue. “The buying should continue from now on as first quarter results of top companies such as Infosys, Satyam, Reliance is being eagerly awaited,” said a broker.

A smart rally in the index could be gauged by a strong upsurge in the 21 out of 30 index-based scrips. Earlier in the day, operators entered into fresh commitments on the first day of the new settlement mainly in technology shares. A persistent increase in badla charges in the last couple of weeks and a sharp rise in net outstanding positions to Rs 2,347 crore showed bullish sentiments, dealers said.

Mirroring the trend, the BSE-30 share sensitive index opened firm at 4,808.25 and immediately touched a low of 4,788.94. But sustained buying took the sensex to the day’s peak of 4,884.89.

However, the profit-selling, which emerged after midsession in the index-based software counters such as Infosys, Satyam and NIIT, pruned these gains, resulting in the sensex closing at 4,837.24 as against last weekend’s close at 4,764.67, registering a rise of 72.57 points or 1.52 per cent.    

Calcutta, June 19 
Computech International Ltd (Computech), will raise Rs 47 crore through private placement of equity. The proceeds will be used to retire high-cost debt and part finance the company’s investment plans in the computer hardware and software sectors.

Addressing a press conference here today, Computech chairman S.K. Rateria said the company was talking with several companies in India and abroad in this regard.

The private placement process, which would dilute the promoters’ holding by five to seven per cent, should be over in the next three-four months, he said.

The company made a profit of Rs 16.8 crore in 1999-2000 on a turnover of Rs 72.38 crore.

Rateria said the company needed Rs 17 crore to retire its entire debt in order to achieve a savings on interest of Rs 2.3 crore per annum.

The company will invest Rs 14 crore in the software sector while Rs 8 crore will be pumped into hardware manufacturing.

Computech has also emerged as an internet service provider for which it has drawn up a Rs 200 crore investment plan.

Computech has already set up a wholly-owned subsidiary — Worldwide Ltd — which will look after its internet businesses.

“We have plans to introduce our internet services in Calcutta within two months. Subsequently we will go to Guwahati, Siliguri and Rourkela,” Rateria said.

Rateria indicated that the new company might tap the capital market or rope in a venture capital fund to finance its ISP plans.

Further, the company has chalked out an ambitious plan to triple its sales of personal computers from last year’s 12,000 units.

“We have decided to offer personal computers at as low as Rs 15,000 to suit every household customer,” Rateria said, adding the company had tied up with Bell International to source micro-processors for these lower end PCs.

Rateria assures that the company will continue to supply computers at cheaper prices although configuration will upgraded.    


Foreign Exchange

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*SBI TC buying rates; others are forex market closing rates


Calcutta		Bombay
Gold Std (10gm)	Rs. 4625	Gold Std (10 gm)	Rs. 4560
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