Unlimited scope for limited mobility
Govt seal on Net telephony
Stocks heave sigh of relief as temple tension eases
Haldia Petro takes first step to debt recast
Supriyo Gupta to head CSE panel
RBI flip-flop on rate cut
Real estate sector to get more govt support
Cure for boardroom boredom
Atlas Copco buyback price saddens market
Foreign Exchange, Bullion, Stock Indices

New Delhi, March 15: 
Reliance and the champions of limited mobility today won the battle as the Telecom Dispute Settlement Appellate Tribunal (TDSAT) dismissed the petition filed by cellular operators who were objecting to the idea of granting fixed line service providers a facility that had the potential of knocking them out of business.

Consumers all over the country can make call at Rs 1.20 per three minutes and will not have to pay for the incoming calls as in case of cellular phones.

At present, Bharat Sanchar Nigam Limited, Mahanagar Telephone Nigam Limited and a few fixed line private operators are offering this limited mobility using an old system that offers mobility within 25 kilometres. After today’s Telecom Dispute Settlement Appellate Tribunal order, these operators can install upgraded equipment that will allow a subscriber to make calls up to 250 kilometres.

The order has opened up a huge market for US-based Qualcomm for its equipment based on code division multiple access (CDMA) technology, which helps to provide limited mobility.

Welcoming the order, S.C Khanna, secretary general of Association of Basic Telecom Operators, said, “It is the right judgement and is in tune with the National Telecom Policy-1999. The march of technology cannot be stopped.”

V.P. Chandan, president of Qualcomm India, said, “Qualcomm India welcomes TDSAT’s decision to allow CDMA-based WLL mobile telephone service. It is a victory not only for the CDMA but for all the new emerging technologies. The tribunal has rightly observed that nothing should be allowed to stand in the way of pursuing the government’s objective of increasing tele density in India. It will now make available affordable and quality services to the common man.”

The cellular operators were peeved at the judgement and have threatened to file a special leave petition (SLP) in the Supreme Court on Monday.

T.V. Ramachandran of Cellular Operators Association of India (COAI) said, “The cellular industry is deeply disappointed with the adverse judgment of the TDSAT in the matter of limited mobility for fixed line operators. We firmly believe that this judgement will deliver a disastrous blow to investor confidence in the telecom sector and will severely impact investments of over Rs 20,000 crore that have been made in the cellular industry.”

The limited mobility issue had been hotly debated for the last two years and today the TDSAT said limited mobility should not be stopped since increasing the tele-density in the country is important.

“There cannot be any legitimate expectation that no new technology will evolve and if any new technology comes, that will not be allowed to be adopted by any competitor of the petitioners (cellular operators). That will be an illegitimate expectation,” stated the TDSAT order passed by S.C Sen, R.U.S. Prasad and P.R. Dasgupta.

“Taking into consideration all these facts we are of the view that this petition must fail and is dismissed,” it added.

IndiaOne licence

Bharti Telesonic (IndiaOne), the country’s first private national long distance operator and a fully-owned subsidiary of Bharti Televentures, has secured the licence for operating services in the international long distance telephony (ILD) sector.


New Delhi, March 15: 
The government today decided to allow internet telephony from April 1.

Accepting the recommendations of the Telecom Regulatory Authority of India (Trai), the government has allowed voice communication over computers using telephone, an official release said here.

The customers of internet service providers (ISPs) would be able to avail this service from their personal computers (PCs) capable of processing voice signals or other IP-based customer premises equipment.

The services would be from PC to PC (both within as well as outside India), PC to telephone (PC in India to telephone outside India) and IP-based H.323/SIP terminals in India to similar terminals both in India and abroad, employing IP addressing scheme of ‘Iana’.

Seeing internet telephony as win-win for all, the Internet Service Providers Association of India (Ispai) said today it would bring a widespread illegal practice into the legal domain resulting in an increase in revenue for the government as well.

“It will not only help in spreading the internet culture throughout the nation, but will also provide a boost to the fortunes of basic operators, internet service providers, cyber cafes and even public call centres,” Amitabh Singhal, Ispai secretary, said in a release.

Internet telephony increases the overall utilisation of basic service operators and national long distance operators networks allowing more conversation per link than otherwise possible, it said.

By restricting internet telephony to PC-to-PC (within and outside India) and PC-to-phone (outside India only), the regulator has proposed measures that will allow all stake holders to benefit without hurting the interests of any particular category, he said.

The Federation of Indian Chambers of Commerce and Industry (Ficci) today welcomed the government’s decision to allow internet telephony from next month.

In a statement here, Ficci said the move will bring in the desired competition in international voice telephony, bring down the cost to customers and cut down illegal call rackets.


Mumbai, March 15: 
Share prices on major bourses soared as Ayodhya turned out to be a damp squib. Marketmen heaved a sigh of relief with the VHP’s controversial shila daan passing off peacefully.

The market barometer—the benchmark 30-share BSE sensex—inched up 1.03 per cent (36.85 points) at 3,617.68 points, on a day marked by volatile price movements.

Gainers far outnumbered the losers on the bourses, 784 to 470, while traded volumes rose to 10.04 crore shares compared with the previous day’s 7.27 crore. The total traded turnover rose sharply at Rs 1574.42 crore from Rs 1266.38 crore on Thursday. Zee Telefilms was the most active counter, with a turnover of Rs 232.38 crore, followed by Infosys Tech (Rs 168.84 crore).

Having crossed today’s hurdle, the market is expected to regain its confidence. In fact, the rise was led by public sector companies.

HPCL rose 3.6 per cent, while its rival BPCL gained 2.9 per cent. Giving them company today was index heavyweight Reliance Industries, the private sector petrochemicals major, which climbed 3.6 per cent. So did PSU telecom major MTNL, which rose 2.7 per cent after the telecom regulator raised rentals for commercial telephone users by 22-33 per cent.

MTNL surged Rs 6.10 to Rs 154.95, HPCL went up by Rs 10.30 to Rs 299.50, BPCL by Rs 9.15 to Rs 319.80. Analysts say that MTNL could earn an additional annual income of Rs 250 crore by this move.

However, it was Infosys’ turn to disappoint today, as the scrip shed values on the back of heavy selling by foreign funds, attributed to the shadow on its principal customer Nortel. Second-rung as well as new economy shares continued to be in the limelight on speculative buying support. Zee Telefilms rose by Rs 13.70 to Rs 171.15 and Reliance by Rs 10.70 to Rs 308.25, SBI by Rs 5.20 to Rs 233.35, while Max India by Rs 18.55 to Rs 122.85.


Calcutta, March 15: 
The arduous task of restructuring the debt burden of Haldia Petrochemicals Limited (HPL) got under way today with the promoters agreeing to convert a Rs 270-crore loan into preference shares. The decision was taken at an extra-ordinary general meeting (EGM) held here today.

The company had taken the loan from three government agencies—West Bengal Industrial Development Corporation, West Bengal Industrial Infrastructure Development Corporation and West Bengal Infrastructure Development Finance Corporation—at an interest rate varying between 13 to 13.5 per cent during the financial closure of the project.

Sources said at today’s EGM, the promoters agreed to issue cumulative preference shares with a coupon rate of 1 per cent redeemable after 10 years, with an option of extending it for another five years.

Simultaneously, HPL’s bankers met today to review its operations and performance, and discussed the company’s working capital limit.

“This is a quarterly review meeting, where banks also decide the working capital limit that they can grant in favour of the company in the following months,” an HPL official said.

In February, the company produced around 43,000 tonnes of polymers and 31,000 tonnes of chemicals.

The company was able to sell about 32,000 tonnes of polymers and only 14,000 tonnes of chemicals.

The official said that sales of chemicals vary each month. “Chemicals sales were lower in February but we feel that the volumes will be higher this month,” he added. However, the company is in a comfortable position since the naphtha prices are hovering around Rs 10,000 per tonne.

Normally, the working capital requirement of HPL varies between Rs 200-230 crore per month. “For April, the working capital requirement will be on the higher side, around Rs 220 crore,” a banker to the company said.

The HPL official said the company’s operating profit was positive from July. “But the high interest burden of Rs 45 crore is eating into its profits,” the bankers present at today’s meeting said.

Senior officials of the Calcutta-based banks said, “Unless HPL’s debt is restructured, it will be difficult for the company to survive. The debt restructuring of the company will have to be taken up by Industrial Development Bank of India, the consortium leader.”

However, till now there has been no progress on this front, except for a fresh debt restructuring package that has been placed before IDBI.

The financial institution feels that the company needs a fresh equity infusion of Rs 1,000 crore, while Purnendu Chatterjee, the majority shareholder, feels that an infusion of Rs 600 crore equity will solve the problem.


Calcutta, March 15: 
The Calcutta Stock Exchange (CSE) today decided to appoint five new public representatives, while designating Supriyo Gupta as the chairman of the management sub-committee.

The CSE board has nine broker-directors and eight public representatives now. Senior Sebi official Dharmistha Rawal put in her papers following the market regulator’s decision to withdraw its officials from the boards of stock exchanges.

Of late, four independent directors have distanced themselves from the exchange. Dipankar Basu, erstwhile chairman of the management sub-committee, resigned recently. Three others — S.S. Ahuja, V.N. Reddy and C.D. Paik — have not been attending board meetings regularly.

The exchange has prepared a shortlist of six people and will seek Sebi’s approval to appoint them as directors. Further, the exchange has requested Basu to continue as a director. The exchange should ideally have nine broker-directors and as many public representatives.

Meanwhile, the brokers on the board of the exchange today considered the proposal to amend the bye-laws of the exchange, but decided to scrutinise the new regulations further.

A committee of three brokers was formed to examine the new laws. The new bye-laws will be discussed at the next board meeting on April 12. Till the new regulations come into effect, Gupta will continue as chairman of the management panel.


New Delhi, March 15: 
The Reserve Bank of India today did a flip-flop on plans to cut the bank rate, stating it was in “no hurry” to do so within days of indicating it could happen “any time”.

“We are not in a hurry (to cut the bank rate). (However, a) soft interest rate bias will be maintained,” RBI governor Bimal Jalan said, trying to play down his deputy Y.V. Reddy’s statement on Monday that “a bank rate cut...can be any day, any time.” Jalan, however, did not get drawn into any explanation of how he would describe a soft rate bias. Reddy’s statement had infused life into an otherwise lacklustre bond market with prices of government securities rising by as much as 50 paise over previous levels in a single day’s trading.

Markets have been abuzz with news of a possible rate cut by about 50 basis points for some time and this had been strengthened early this month when the RBI had reduced the repo rate by half a percentage point to 6 per cent. Finance minister Yashwant Sinha, too, had reduced administered interest rate by half a per cent.

The central bank last year had slashed bank rate thrice to 6.5 per cent. This had been done with the avowed intention of bringing down domestic rates to a level near global interest rates.

Asked whether RBI was considering a bank rate cut during the 2002-03 credit policy, Jalan said, “We will think about it.”


New Delhi, March 15: 
In its bid to give a boost to the real estate sector in the country, the government today said it will frame norms to allow banks to create a second mortgage on housing loans which will be laced with a depreciation benefit that will give them a small tax break.

“The real estate sector has clocked a 28 per cent growth during an extremely recessive phase and deserves all the support that we can provide for them. The second mortgage will not only increase the purchasing power but will also increase the lending capacity of the bank. We will look into the proposal of second mortgage and depreciation allowance as a package,” said Ananth Kumar, Union minister for urban development and poverty alleviation.

At present, second mortgages are not allowed in the country. If it is permitted, the banks will be allowed to claim depreciation on the property as an expense on their balance sheets. This will reduce the profit element and thus the taxation will be lower.

Kumar said, “Stamp duties are still a problem. Many states have yet to revise the urban land ceiling laws. The proposal for an Urban Reform Incentive Fund with Rs 500 crore contribution would effectively cover issues relating to revision of rent control acts, urban land ceiling and regulation act, rationalisation of stamp duties and evolving appropriate building bye-laws should be decided on as early as possible.”


New Delhi, March 15: 
Humdrum board meetings may soon be a little less drab, if technology is allowed to step in and add a dash of excitement, besides bridging time and distances.

The department of company affairs (DCA) has asked the Institute of Company Secretaries of India (ICSI) to examine the prospects of holding board meetings through video-conferencing.

The ICSI recently organised a meeting with major companies, as well as representatives from the ministry of information technology, to discuss the issue. The legal framework, issues of management as well as the problems of technical security were some of the issues discussed at the meeting. The ICSI submitted a draft report and made a presentation on the same to the DCA.

The need for examining prospects of holding board meetings through the video-conferencing route arose when the commerce ministry wrote to the DCA, asking it to make this option available to the Special Economic Zones (SEZs).

According to the DCA, it is not possible under the present circumstances to allow all the meetings through video-conferencing, as some issues will still require physical presence of the persons concerned. Further, some issues such as misuse of the facility, disputes, technical problems and dummy attendance would need to be thoroughly deliberated upon.

Another tricky issue before the DCA is the area that will be considered as the place of meeting, in case all members decide to hold the meeting through video-conferencing. Whether the place where the chairman is present will be considered as for the purpose, has yet to be decided.

Further, the provisions prescribed under the Companies Act, 1956, regarding the powers to be exercised at board meetings only, also need to be looked into. “The modalities for carrying out this novel concept are being worked out,” said ICSI president S. Gangopadhyay.

Meanwhile, the institute has drawn up a comprehensive list of rights and obligations for directors of companies, considered significant in the context of the issue of corporate governance and transparency in disclosures. The idea is to inform directors of every newly incorporated company about his or her responsibilities.

According to Gangopadhyay, the registrar of Companies (ROC) which grants certificates of registration to companies will be required to circulate this list. The DCA, he added, has already approved the proposal.


Mumbai, March 15: 
Atlas Copco AB will increase its stake in Atlas Copco India Ltd through share buyback. The Swedish parent seeks to buy around 25 per cent of the Indian company’s equity at a price not exceeding Rs 150 per share.

The company communicated this to the stock exchanges after a board meeting held today.

However, following the announcement Atlas Copco scrip came under selling pressure in the bourses as market was unhappy with the buyback price announced by the company. Marketmen said that they were expecting the price to be around Rs 170 per share.

The scrip opened at Rs 137.50, touched the day’s high at Rs 138. It started losing ground as the buyback price was announced and hit the day’s low at Rs 125. The counter closed slightly better at Rs 126. It conducted 659 trades with 36,663 shares being transacted at a total turnover of Rs 47.58 lakh.

Atlas Copco (India) Ltd was incorporated in 1960 as a private limited company when it set up a small factory in India for manufacturing and selling compressors and rock drills. It became a public limited company in 1972. The parent company initially held around 44.87 per cent in the Indian outfit and subsequently raised its stake up to 51 per cent with FIPB’s permission.

Atlas Copco AB, Sweden, operates worldwide with manufacturing facilities in 14 countries and sales, service and rental operations in 150 countries.

The Indian company manufactures of air & gas compressors and construction & mining equipment. It has a manufacturing facility in Pune and sales and service offices all over the country. The company employs 500 people directly.

In the last two decades, Atlas Copco Group has developed through internal growth as well as by major acquisitions of companies.



Foreign Exchange

US $1	Rs. 48.71	HK $1	Rs. 6.15*
UK Ł1	Rs. 69.24	SW Fr 1	Rs.29.05*
Euro	Rs. 43.04	Sing $1	Rs.26.40*
Yen 100	Rs. 37.70	Aus $1	Rs.25.15*
*SBI TC buying rates; others are forex market closing rates


Calcutta			Bombay

Gold Std (10gm)	Rs. 4945	Gold Std(10 gm)	Rs.4870
Gold 22 carat	Rs. 4670	Gold 22 carat	NA
Silver bar (Kg)	Rs. 7725	Silver (Kg)	Rs 7795
Silver portion	Rs. 7825	Silver portion	NA

Stock Indices

Sensex		3617.68		+ 36.85
BSE-100		1762.73		+ 16.62
S&P CNX Nifty	1169.75		+ 10.30
Calcutta	 121.31		+  1.58
Skindia GDR	 551.96		-  2.29

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