Sinha wants markets to tighten act
Tisco projects record net profit
Bengal industry asked to raise power offtake
Sun Pharma to spend Rs 40 cr on research
TV makers crestfallen
Linked with Indian arm to offer WAP solutions
HDFC romps home with 14% profit leap
CNG-based rural vehicle from Hind Motors stable
Foreign Exchange, Bullion, Stock Indices

Mumbai, Jan. 18: 
Union finance minister Yashwant Sinha today said the stock markets will have to get their act together by plugging all the loopholes in their rules and regulations if they want to win back the confidence of retail investors who have been scalded by the recent flameout in equities and have never quite forgotten how a gaggle of fly-by-night operators took them for a ride back in the early nineties.

“Money from investors will not come until the confidence is established,” Sinha said on a visit to the commercial capital just weeks before the presentation of his budget for 2000-01.

While admitting that the Indian capital markets were a lot safer today, the finance minister said the onus of ensuring investor protection had now become even greater on companies which have been directed to implement the code on corporate governance.

“A lot of volatility has been witnessed on the stock exchanges in India in recent times but no payment crisis has occurred,” the finance minister said.

Speaking at a function organised by the Investors’ Grievances Forum at the BSE to launch its awareness campaign, Sinha said small investors were sworn off the market because they had burnt their fingers too often.

“We should put in place a system where the investor gets the entire amount he has put in or a significant part of it. For this, he should be properly educated,” Sinha added.

Union law minister Arun Jaitley, who shared the podium with Sinha, revealed that the government would shortly unveil its Investors Education & Protection Fund which would provide the necessary cash to provide education and legal assistance in order to improve investor awareness.

He said recent amendments to company laws had made it mandatory for companies to pay any amount due to the investors. If they failed to do so, the Company Law Board would initiate action against the errant company; the provisions also provided for strong penal action against the offenders.

Jaitley also said the government was considering the Justice Irani committee’s recommendation that the time limit for completing the process of winding up companies should be shortened.

Tax parity for insurers

Earlier in the day, Sinha said the government was determined to create a level playing field in the area of insurance by implementing the recommendations of the Eradi committee in order to ensure equity in tax treatment between state-owned insurers and the newly-emerging private players.

“The intention of the committee is to create a level playing field as far as taxation is concerned. We will ensure that the committee’s recommendations are examined quickly and incorporated in the budget this year. The new players will, thus, be assured of a level playing field and uniform application of tax rates across the insurance sector,” finance minister Yashwant Sinha said.

Private insurance players in the country have been calling for a level playing field in the area of personal taxation and group schemes, particularly for long-term pension plans. The demand has assumed significance as new entrants will not be generating any surpluses in the first few years.

The Eradi committee is expected to present this report in the next two days to the government, said Y.H. Malegam, member of the insurance taxation panel.

Selloff target elusive

Sinha also admitted that the government might fail to achieve the budgeted divestment target of Rs 10,000 crore fixed for the current fiscal. After inaugurating the corporate office of HDFC-Standard Life, he told reporters that the divestment moves by the government involved a “lot of work and deliberation”.

He said the disinvestment programme was proceeding according to a plan and the government would not waver on its commitment to sell its stake in the non-core, non-strategic PSUs.


Mumbai, Jan. 18: 
Tata Iron and Steel Company (Tisco) is poised to record its highest-ever net profit in the current financial year, bettering the 1995-96 figure of Rs 565.79 crore.

Managing director J J Irani hinted at the possibility at a press conference organised here today to dispel concerns over lower third-quarter profit. He said the nine-month figure of Rs 375.43 crore — almost 66.35 per cent of the 1995-96 profit — was a pointer to the fact that the steel major was on course to achieve the best bottomline in its history.

The expectations are based on the fact that its cost-cutting efforts are paying off and its one-million tonne cold-roll mill at Jamshedpur, which went on stream last year, is rolling out products valued higher in the market than hot-rolled (HR) items, Irani said.

Efforts are now under way to operate the cold-roll mill at full-pelt as part of a bigger plan that will see the proportion of hot-roll products decline over the years. Hot-rolled coils account for 52 per cent of the total production and cold-roll coils 12 per cent. This will be changed to 28 per and 34 per cent; semis will continue to account for 8 per cent. “What we were selling five years ago was totally different,” Irani said..

Finances will be tightened too. As part of the effort, high-interest Tata Trust bonds worth Rs 500 crore will be redeemed early by using the call option. The total outgo on the bonds, which carry a 17.5 per cent rate of interest, will be Rs 700 crore, Irani said. However, the company has not decided whether it will dip into its internal reserves or borrow from the market at cheaper rates to pay bond-holders.

Meanwhile, Tata Steel’s staff-strength has come down to less than 50,000 on January 1 compared with over 78,000 a few years ago. The number will be reduced further to 48,000 by April.


Calcutta, Jan. 18: 
Faced with crippling fluctuations in load at its power plants, the West Bengal State Electricity Board (WBSEB) has requested the industry to increase its offtake.

The board has spelt out a revised time-frame for giving industrial connections. It held a meeting with the representatives of West Bengal Industrial Development Corporation, Webel and other nodal agencies on Wednesday to discuss the matter. The meeting was also attended by the officials of the Eastern Regional Load Despatch Centre (ERLDC).

Senior WBSEB officials said there is a surplus of nearly 1,000 MW in the evening and night. “This is the time when only commercial and domestic connections are drawing power. There is hardly any demand from the industry,” the officials said.

Electricity cannot be stored and, therefore, has to be generated, transmitted and distributed within standard frequencies round the clock. “For these reasons, power must be supplied at peak efficiency levels to all consumers,” a senior official said.

Apart from its financial woes, the WBSEB and the Eastern Region Grid are plagued by problems of frequency excursion between 53 Hz and 47 Hz. This causes serious damages to industrial units, thermal power plants and their machines.

Due to the highly skewed hydro-thermal ratio of 3:97, compared with the desirable minimum of 40:60, there are steep off-peak surpluses and peak deficits.

The existing thermal plants are not only old, but they have to withstand sharp fluctuations in the consumption of power. This leaves them operating at a very low loads for long periods of time to the detriment of their machines. Load despatch officials made a presentation to the industry on issues related to high frequency at Wednesday’s meeting.

According to the revised formula outlined by WBSEB for industrial connections, joint inspections for consumers below 50 KVA will be carried out within 10 days, above 50 KVA and up to 500 KVA within 15 days and above 500 KVA within 30 days.

Connections below 50KVA will be given within 15 days, above 50KVA and up to 500 KVA within 30 days and above 500 KVA within the same time.


Calcutta, Jan. 18: 
Sun Pharmaceutical Industries has decided to invest Rs 40 crore in the next 18 months for drug discovery research.

Sun Pharma, which had initially set up a research and development (R and D) centre in Gujarat with an investment of Rs 5 crore in 1993, has by now pumped in Rs 100 crore on drug development and patenting and has employed a 190-strong scientific team. Shyamal Ghosh, senior vice-president of Sun Pharma, said this was important as the exclusive marketing rights which will be in force soon, will result in prices of drugs going up as most companies were manufacturing drugs at present using process patents only.

Ghosh said the company, which has launched 25 patents in the current year, plans to introduce about 30 new drugs every year for the next four years before the exclusive marketing rights come into effect in 2005.

The company already has patents for close to 300 formulations, developed mostly through analogue research and drug delivery systems, Ghosh noted.

He said Sun Pharma was hoping to gross close to Rs 600 crore by the end of the current fiscal, against Rs 500 crore last year.


Mumbai, Jan. 18: 
The idiot box stands for entertainment all the way — whether providing information or enlivening a weary evening. Unless of course, you happen to be making one of them.

Dismal growth figures have left manufacturers with little to cheer about. The consumer electronics industry recorded negative growth figures from November 2000 to January 2001, according to the Consumer Electronics and TV Manufacturers Association (Cetma).

In November 2000, the colour TV industry recorded a negative growth of 15 per cent, while for the period from January to November 2000 the growth was at a negative 10 per cent.

Even the black & white TV industry is in bad shape, recording a negative growth for the period as rural markets face a downswing in demand.

Cetma president Rajeev Karwal said the industry achieved a measly growth of two per cent at Rs 11,500 crore during the period.

“Our vision is to propel the industry to touch a turnover of Rs 100,000 by the year 2010, from the current level of Rs 12,000 crore and it should establish itself as a global supply base for consumer electronics and related products.”

Cetma has asked the government to set up a joint task force to define a clear road map to study the converging technologies of the future.

“Putting the electronic hardware industry on the backburner is in conflict with the government’s policy of using the media for mass communication,” Karwal pointed out.

Stating that the Cenvat duty at 16 per cent for a black-and-white TV is on the higher side as it is a poor man’s product, Karwal said the television industry should have different slabs for different products, as is the case with two-wheelers, which has different tax slabs for bicycles and motorcycles.

Pleading for more concessions to survive the slide, the industry has also sought lowering of customs duty for colour picture tubes to 25 per cent.

Colour picture tube (CPT) constitutes 40 per cent of the cost of a CTV set. No component for the electronic industry attracts a customs duty of more than 25 per cent except CPTs, Karwal said.


New Delhi, Jan. 18: 
Linkedwith India, an Indian subsidiary of wireless application protocol (WAP) solution provider Linkedwith GmbH, will offer wireless information technologies in the country.

Following its recent launches in the European and American markets with a range of WAP products/solutions, the company set up its marketing office in the capital today.

Launching its India operations, Kim Onneken, joint CEO and chief technical officer, Linkedwith GmbH said, “We plan to sell our flagship m-commerce solutions to ISPs, media houses, MNCs and major Indian companies in the first quarter of 2001. Linkedwith India is planning to organise a technical presentation in all major cities where a live demonstration of the product will be given.”

Linkedwith services partners and key accounts with first level development and installation support. The company’s products are supported by infotech and telecom companies like ADA, Exodus, Ericsson, IBM-Lotus, Mannesmann Mobilfunk-D2, Magirus, Mobiliser, MC Marketing Corporation AG, MSDN, Microsoft, Nokia, SUN Microsystems, Software AG, SCO, and 3COM.


Jan. 18: 
Housing Development Finance Corporation (HDFC) has reported a third-quarter net profit of Rs 108.6 crore, up 14.12 per cent from Rs 95.16 crore in the same period of the previous financial year.

Income from operations during this period increased 13.75 per cent to Rs 579.62 crore (Rs 509.62 crore in previous Q3 last year), according to unaudited results released here today.

Approvals during the nine-month period ended December stood at Rs 4,716.04 crore, an increase of 31 per cent from Rs 3,608.15 crore during the corresponding period of the previous year. Disbursements during this period amounted to Rs 3,833.64 crore, up 30 per cent from Rs 2,955.34 crore.

Approvals and disbursements in respect of individual loans were higher by 52 per cent and 54 per cent respectively during the nine month period compared with the corresponding period in the previous year, a company release said.

ITC Hotels income up 5%

ITC Hotels today announced that its profit after tax during the third quarter increased by 8.44 per cent at Rs 4.11 crore compared with Rs 3.79 crore in the corresponding period last fiscal.

Total income during the quarter increased by a modest 4.95 per cent at Rs 36.44 crore as against Rs 34.72 crore in the same period last year, company officials said here today.

Profit after tax between April and December, 2000, however, registered a growth of 21.82 per cent at Rs 5.75 crore compared with Rs 4.72 crore in the same period of previous fiscal.

Expenditure increased to Rs 28.25 crore from Rs 26.98 crore, while profit before interest, depreciation and taxes increased to Rs 8.19 crore from Rs 7.74 crore in the same period last year.

Though depreciation remained higher at Rs 2.41 crore (Rs 2.28 crore last year), company managed to cut interest charges to Rs 1.07 crore from Rs 1.17 crore last year. Officials said the company had paid Rs 88 lakh to finance its voluntary retirement scheme (VRS). This amount has been charged to the profit and loss account. Total payment under this head from April to December amounted to Rs 1.71 crore.

Godrej Soaps Q3 net up 42%

Godrej Soaps Ltd has reported a 42 per cent rise in net profit at Rs 18.50 crore in the third quarter ending December compared with Rs 12.98 crore for the same quarter last year. Income showed a 26.49 per cent growth to Rs 244.64 crore during this period (Rs 193.40 crore in Q3 last year), according to unaudited results released here today.

For the nine-month period ending December the net profit was, however, down to Rs 51.37 crore compared with Rs 57.7 crore in the same quarter last year. Income during this period was also up at Rs 649.23 crore (Rs 554.49 crore).

Varun Ship well anchored

Varun Shipping Company has reported a 63.04 per cent increase in its third-quarter net profit at Rs 3 crore compared with Rs 1.84 crore in the same quarter last year, helped by improved earnings on its LPG carriers, product tankers and dry bulk fleet.

Total income went up to Rs 51,04 crore from Rs 42.67 crore for the same period last year, the company said in its unaudited results released today. The net profit for the nine-month period was Rs 9.67 crore compared with Rs 7.24 crore for the corresponding period in the previous year. What is remarkable is that the net-profit for nine months has already exceed that of the last financial year, the release said.

Novartis pales

Novartis India has posted a net profit of Rs 12.19 crore for the quarter ended December 31 compared with Rs 32.38 crore in the corresponding period last fiscal. Net sales stood at Rs 114.1 crore compared with Rs 234.02 crore. Other income shrunk 49.42 per cent at Rs 5.66 crore in the quarter ended December 31 from Rs 11.19 crore ended December 1999.

Meanwhile, the high court has approved the scheme of arrangement for demerger of agribusiness undertaking, comprising crop protection and seeds businesses to a separate entity, Syngenta India, with retrospective effect from April 1 2000. Therefore, the results for quarter ended December 31 pertains only to the remaining health care business and, hence, are not comparable with results of the previous year.

Sonata leaps

Sonata Software has reported a third-quarter net profit of Rs 8.34 crore, up from Rs 6.23 crore in the same period of last year. The jump was recorded despite the fact that its total income declined 30.6 per cent at Rs 29.5 crore from Rs 42.64 crore in the same period last year.

Digital gains

Digital Equipment (India) has reported a net profit of Rs 16.5 crore for the quarter ended December, up from Rs 5.75 crore in the same period last year. Sales increased from Rs 21.1 crore in the same quarter of the last financial year to Rs 52.6 crore in December 2000. Other income stood at Rs 3.52 crore, up from Rs 1.85 crore in the corresponding period of 1999-2000.


New Delhi, Jan. 18: 
Hindustan Motors Ltd (HM) today unveiled a compressed natural gas (CNG) version of its rural transport vehicle (RTV) developed in association with Australia-based OKA Motor Company.

The vehicle is priced at Rs.4.36 lakh (ex-showroom Delhi) and is targeted at the markets in Delhi and other northern states. In Delhi alone, Hindustan Motors expects to sell more than 700 units by December. The company will also sell the RTV in other markets depending upon the demand.

Launching the vehicle, B.K Chaturvedi, Hindustan Motors president, said, the company will market the RTV as the “ideal multi utility vehicle which can carry a variety of body types and is adaptable to multiplicity of purposes.”

“We expect to sell about 100 RTVs every month in this fiscal and about 2,500 units in 2001-02,” he said, adding Hind Motors was at present, selling the RTVs in Madhya Pradesh, Tamil Nadu besides Delhi.

“One of the biggest factors which would influence the consumer demand is the competitive price point and being only one of its kind in this category. The nearest competitor for our RTV is CNG bus which is priced at about Rs. 17 Lakh. Moreover the availability of these buses is also limited.”

The CNG vehicle would be powered by a four cylinder, 1817 CC, dedicated (Isuzu converted) CNG engine as well as five-speed syncromesh gear box.



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