Bharti tops fourth cellular bids
Market exit route for US-64 may be widened
JPC may summon UTI brassas witness
Satyam net leaps 141% to Rs 121cr
Hughes net profit doubles
CMC told to account for CSE software snag
Enron chief rounds off trip on an upbeat note
Winter date for turnaround
Foreign Exchange, Bullion, Stock Indices

New Delhi, July 11: 
Financial bids worth only Rs 2,229.93 crore were tabled in the first of the three-stage bidding process for the 17 circles thrown open to the fourth cellular operator.

Bharti Cellular forged ahead in the race, throwing its hat in 11 circles with bids that added up to Rs 722.43 crore.

In doing so, the Sunil Bharti Mittal-promoted company elbowed Reliable Internet services Ltd to the second spot. The Reliance-promoted firm is vying for 15 circles with combined bids of Rs 515 crore.

Mumbai emerged to be the most prized market with Bharti quoting Rs 203.65 crore for the Mumbai circle. It was followed by Barakhamba Sales and Service Ltd — a joint venture between C. Sivasankaran’s Sterling group and Hutchison — which is ready to shell out Rs 150.4 crore for the Karnataka circle.

The Calcutta circle drew only two bidders: Bharti Cellular quoted Rs 77.85 crore while Reliable Internet Services Ltd (a Reliance group company) filed a bid worth only Rs 25 crore.

In the Delhi circle, Reliable Internet Services was the highest bidder at Rs 90 crore. Trailing it were Birla AT&T with Rs 80.5 crore and Escorts Telecommunications Ltd with Rs 61 crore.

The lowest bid for a Category A circle was Rs 20.5 crore. It was filed by Birla AT&T for the Chennai circle.

Barakhamba Sales and Services has quoted Rs 473.9 crore for 14 circles while Escorts Telecommunications is ready to pay Rs 292.1 crore for the eight circles it is interested in. Birla AT&T has bid Rs 121.5 crore for three circles while Ind Mobile is willing to fork out Rs 105 crore only for Punjab. Madhya Pradesh and Himachal Pradesh attracted only one bid each, and there are growing indications that the government will fix the reserve price in these two circles. In Rajasthan, Escotel’s bid was the highest at Rs 18 crore followed by Bharti at Rs 17.45 crore.

The six telecom service providers — Bharti, Reliable Internet Services Ltd, Barakhamba Sales and Services Ltd, Escorts Telecommunications Limited, Birla AT&T and Ind Mobile — now move to the second round of financial bidding.

The final stage of bidding will be held on July 19 and the announcement of successful companies made on July 19. The fresh licences are expected to be issued by the end of August. The technical bidding for the non-exclusive 20-year licences, which can be extended by 10 years, closed on June 29.

Successful bidders will have to deposit 20 per cent of the bid amount — the entry fee — upfront and pay 80 per cent by July 30. The letter of intent will be issued the next day along with the signing of licence agreements by service providers.


Calcutta, July 11: 
Investors of US-64, Unit Trust of India’s (UTI) flagship scheme, may soon be able to sell units in the stock markets without having them dematerialised.

At present, up to 500 units can be traded through the odd-lot window in the physical mode, but the facility is limited to original purchasers.

In view of the ban on sale and repurchase on the scheme, the Securities and Exchange Board of India (Sebi) may take US-64 off the compulsory dematerialised trading list so that it can be traded in the physical mode without curbs.

A formal request has been sent to the market regulator on the issue. UTI executive director BG Daga said the application was made at the end of last month, but there has been no word from Sebi so far.

“We have not had the time to look into the issue since we are busy preparing our presentation to the Joint Parliamentary Committee (JPC). We will look into UTI’s proposal after that. Any proposal which benefits small investors will be considered favourably,” Sebi chairman DR Mehta told The Telegraph.

US-64 is listed on the National Stock Exchange, Delhi Stock Exchange, Ahmedabad Stock Exchange, Bangalore Stock Exchange and the OTCEI.

Though the secondary market for the scheme appears to be reviving, retail investors have not gained since most of them hold units in the physical form.

The Delhi Stock Exchange has opened an odd-lot window to enable investors to trade in US-64 in the physical mode. Other exchanges are expected to follow suit. However, transactions at the odd-lot windows of bourses have been poor.

Withdrawing the scheme from compulsory dematerialised trading will give it greater liquidity, but there is also a fear that this could lead to a glut of units in the stock market. If that happens, analysts say its market price could plunge.


Mumbai, July 11: 
The Joint Parliamentary Committee (JPC) probing the stock market scam is likely to summon top officials of mutual fund major, Unit Trust of India (UTI), to ascertain if the trust had any role to play in the entire episode.

Speaking to newspersons here today, JPC chairman P. M. Tripathy said officials of the mutual fund major would be “called as witnesses”. “A probe into UTI’s involvement in the stock market scam is on the cards,” he said.

Tripathy clarified the JPC would largely look into developments pertaining to the stock market scam. The committee initially plans to summon the trio — the Reserve Bank of India (RBI), Securities and Exchange Board of India (Sebi) and UTI — as witnesses.

The JPC team, in the city on a two-day visit, met senior RBI officials led by governor Bimal Jalan earlier in the day, and later visited the National Stock Exchange (NSE).

Giving details on the panel’s deliberations with the RBI top brass, the JPC chief said the meeting largely dealt with the Action Taken Report on the 1992 share market scam. Tripathy observed the RBI has taken a “good deal of action” in several areas.

The committee was also briefed about developments pertaining to Madhavpura Bank, apart from the exposure of other private sector banks to the capital market.

New index

The Bombay Stock Exchange (BSE) today launched BSE TECk Index which is India’s first free-float based index tracking the technology, media and telecom (TMT) sectors.

The index has 21 constituents covering around 90 per cent of the TMT universe and is positioned as a TMT benchmark. It also decided to shift 14 scrips from Z to B2 group with effect from July 16.


Hyderabad, July 11: 
Satyam Computer Ltd has posted a robust 141.15 per cent growth in net profit for the first quarter ended June 30 this year, over the previous comparable quarter.

The Hyderabad-based company registered a net profit of Rs 121.46 crore as against the previous year’s Rs 50.37 crore, a leap of Rs 71.09 crore. Sales stood at Rs 421 crore, an increase of 75 per cent in the first quarter of 2001-02, while total expenditure has gone up from Rs 151.02 crore to Rs 262.98 crore this quarter.

“The earnings per share shot up to Rs 3.91 per share of Rs 2 value on an enhanced equity base (consequent to the ADS issue), an 118.44 per cent increase over the previous corresponding period,” chairman B. Ramalinga Raju said.

Income from software exports registered a growth of Rs 171.63 crore, with the current quarter figure showing Rs 400.74 crore as against the Rs 227.91 crore during the previous comparable quarter.

Satyam had projected a 40 per cent increase in income from software services, an operating margin of 34-35 percent, and an EPS of Rs 14.75-15.25 per scrip for the year 2002.

While the internet and e-commerce provided 19.70 per cent of the revenues, the traditional maintenance business mopped up 29 per cent, ERP business 7 per cent, telecom 8 per cent and open systems at 31.60 per cent. There was a marginal 3 per cent dip in time and material contracts to 71 per cent, whereas it had contributed to 74 per cent of the revenues in the corresponding period last year.


New Delhi, July 11: 
Hughes Software Systems Ltd (HSSL) today reported a 101.07 per cent rise in net profit at Rs 18.7 crore for the first quarter of 2001-02 as against Rs 9.3 crore during the same period previous year.

The board, which met in Maryland, USA, also raised the foreign institutional investors (FII) limit to 49 per cent from the current 24 per cent.

Hughes has recorded a 77.09 per cent rise in net sales at Rs 63.4 crore as against Rs 35.8 crore, with other income rising from Rs 2.6 crore to Rs 3.2 crore, according to a company statement issued here.

HSSL chairman P Kaul said while the overall market continues to be difficult, the company remains optimistic about meeting its historic growth targets.

“Our ability to help our customers (major telecom equipment manufacturers) bring their products to market faster and at a lower cost continues to be the key to our success in this market,” he said. The new order input during the quarter kept pace with revenues and the company closed the quarter with an order backlog of about $ 22 million, he added.

UTI Bank net up 58%

UTI Bank Ltd has posted a 57.61 per cent rise in net profit at Rs 25.36 crore for the first-quarter ended June 30, 2001 compared with Rs 16.09 crore for the same period previous year. Total income for the quarter was higher by 85 per cent at Rs 367.27 crore as against Rs 198.57 crore for the quarter ended June 30, 2000.

Exide Q1 net dips 48%

Exide Industries Limited (EIL) has suffered a 48 per cent decline in net profit to Rs 3.64 crore during the first quarter of the current financial year. Gross sales, however, increased by 11.6 per cent to Rs 219 crore. The operating profit dipped by 8.5 per cent to Rs 30.3 crore, mainly due to a sharp increase in raw material cost, staff costs and other expenditure.

EIL chairman S B Ganguly said in a statement that the auto battery sales recorded a drop during the first quarter, although the sale of industrial batteries compensated for the decline.

“The setback in the auto battery performance was primarily due to the influx of low cost imports which have eaten into our share this quarter,” he said.

The growth in the industrial battery segment was primarily confined to the low margin original equipment sector, which has affected the profitability for the quarter. The situation, however, was expected to be reversed in the next quarter when the adverse impact of low cost imports was likely to be contained as a result of the interim order of the Anti-Dumping Authority, he said.


Calcutta, July 11: 
The Joint Parliamentary Committee (JPC) probing the recent stock scam has asked CMC, which runs the trading platform for the Calcutta Stock Exchange (CSE), to quantify the cumulative shortfall in collection of gross exposure margin caused by a bug in the margin software. According to CSE executive director Tapas Datta, eight to 10 brokers used the bug, which was found to have existed since December 1999, to dodge margin payments during the boom. The probe will aim to identify the brokers who exploited it, and the amount not collected from them since December 1999.

Investigations by Sebi and CSE authorities had revealed that the gross exposure margins payable by brokers was reported zero whenever the actual amount exceeded Rs 2.14 crore, as a result of the software snag. Brokers are required to pay 5-10 per cent of their total outstanding positions as gross exposure margin on a daily basis.

CMC officials, however, say the exchange’s surveillance and margin departments should have detected the error if they had closely examined reports generated by the software. The error was eventually detected when reports generated by it were compared with data obtained from other sources. The JPC feels lapses in margin collection were largely responsible for the build-up of massive positions by operators, which, in turn, led to the payments crisis. The panel and Sebi are trying to quantify the volume of outside market badla, which was responsible for bringing CSE to its knees.


Mumbai, July 11: 
A hectic round of meetings with state government officials and politicians later, Enron Corp chairman Kenneth Lay was confident that a solution to the Dabhol imbroglio would soon be found. “I did not want to leave the country this time without reaffirming my interest in, and support for India, and my strong belief that there is great potential in this country,” Lay said before leaving for the US.

He said the face-off involving the Maharashtra State Electricity Board (MSEB) and Enron subsidiary Dabhol Power Company (DPC) over the latter’s $ 3-billion power project in India, had international ramifications, and “he was interested in seeing the challenges associated with the project speedily resolved, so that it can move forward.”

“India needs to have a well-developed infrastructure, diversified resources and more foreign investment to move forward,” Lay said, adding the DPC project had the ability to and would contribute towards realising India’s potential of becoming a leading economy. The Enron chief said after his meetings with several political leaders, officials and businessmen, he felt there appeared to be a sincere interest to find a solution to the problem.

At his meeting with Shiv Sena supremo Bal Thackeray this afternoon, Lay sought the Centre’s intervention to resolve the energy major’s dispute with the MSEB. “Maharashtra will have to live up to its contract signed with DPC and a significant part of the obligations will have to be fulfiled by the MSEB,” he added.


New Delhi, July 11: 
Union finance minister Yashwant Sinha today said the Indian economy may see a turnaround before the end of the year, thanks to higher tax collections, lower interest rates and a likely uptrend in the global economy.

Addressing the 17th All India Conference of the Chief Commissioners and Directors General of Income Tax here, Sinha said tax collections have to be boosted sharply in the coming years so that the tax-to-GDP ratio goes up.

On the need for widening the tax base in the country, Sinha said the government proposes to double the number of tax assessees in the next three years.

“We are looking at doubling the number of tax assesses in the next two-three years, so that income tax collections touch Rs 60,000-70,000 crore, which should contribute to approximately 1.5 per cent of GDP,” he said.

Regretting the income tax department’s inability to meet the revenue collection target for 2000-01, Sinha hoped that collections will improve this year on better tax administration and extension of the one-by-six rule to the entire country, which has enlarged the tax base.

The one-by-six norm makes it compulsory for people travelling abroad, owning a car, house, credit card or a telephone, or holding membership of a reputed club, to file returns.

The minister said the low GDP growth rate of 5.2 per cent in the last fiscal, as against estimates of over 6 per cent, was due to factors like higher international oil prices and the drought in some parts of the country.

On the GDP growth projections of 6.3 per cent made by the Centre for Monitoring of the Indian Economy (CMIE), Sinha said he would not hazard any guess.

“I am not hazarding a guess on the growth rate this year as there are uncertainties, but the finance ministry has initiated a number of steps to boost revenue collections which will enable us to tide over the problem,” he said.

Sinha, however, saw signs of improvement in the global economy and several other positive factors, which have led him to believe that the Indian economy too will turn around by the end of this calendar year.

Any improvement in the global situation, he said, is expected to have a positive impact on Indian exports, aiding overall GDP growth.



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