Tarun Das is ACC chief
Sensex soars 259 as scrips rebound
Price bands to be widened from May
HLL net in first quarter up 23%
All�s not hunky-dory in family business
Zee to launch 3 regional channels
Wives floored by witchcraft
Decision on FDI caps soon
Wipro net profit leaps 77% to Rs 300.6 crore
Foreign Exchange, Bullion, Stock Indices

Mumbai, April 26 
In a major change of guard at Associated Cement Companies Limited (ACC), Pallonji S. Mistry stepped down as chairman of the cement major and was replaced by Tarun Das, director general of the Confederation of Indian Industry (CII).

Dr S. Ganguly also resigned from the board as its vice-chairman; his post is not being filled up.

At the board meeting held today, the members of the board unanimously decided to induct Tarun Das as an additional director on the board of directors and appointed him as chairman of the board of directors of the company with immediate effect.

Mistry had been a director of the company for over 48 years including over four years as its chairman. Dr Ganguly was associated with the company for the past 11 years in both executive and non-executive capacities.

Corporate mavens said the move was a clear indication that the Tatas had more or less pulled out of the company. Mistry has been very close to the Tatas and is the single largest shareholder in Tata Sons, the holding company for the group.

Apart from N.A. Palkhiwala, the chairman emeritus � a largely ornamental post, the other Tata nominees still on the ACC board are N.A. Soonawala, the legal brain for the Tatas, S.R. Vakil, P.K. Mistry and P.J. Jagus.

However, ACC tried to play down the significance of the development. In a brief press communique, ACC said: �At the board meeting of the Associated Cement Companies Limited held today, Pallonji Mistry indicated his desire to retire from the chairmanship and the board of the company for personal reasons�.

�While reluctantly and very regretfully acceding to his wishes, the board recalled the significant contribution made by Mistry to the development of ACC during his long association with the company,� the statement added.

ACC officials including T.M.M. Nambiar, the managing director of the company, could not be reached as they were closeted in meetings. It was later learnt that Nambiar was briefing the corporate communication officials on how to handle the latest developments.

Speaking to The Telegraph, the chairman of Unit Trust of India, P.S. Subramanyam, maintained that everything was normal at Cement House, the headquarters of ACC. �They (ACC) came up with the consensus candidate and we have accepted the proposal�. In fact, Mistry has been conveying his desire to retire from the board for sometime, he revealed. Even if two nominees of Gujarat Ambuja were inducted in addition to the existing two, the independent directors will be in a majority. Surprisingly, Anil Singhvi, chief financial officer and spokesperson for Gujarat Ambuja Cement Ltd, denied any knowledge of the developments at ACC. �I am not aware of any developments at ACC. I am on a holiday,� he said.

This is surprising as Gujarat Ambuja acquired shares worth Rs 455.10 crore comprising 7.2 per cent of ACC equity at Rs 370 per share last December. Gujarat Ambuja is also said to have acquired another 4 per cent recently. Gujarat Ambuja�s chairman Narottam Sekhsaria was inducted into the ACC board as vice chairman after the company bought the Tatas� stake.

�They are also members of the Ficci,� riposted Subramanyam when his attention was drawn to the coincidence that both ACC and Gujarat Ambuja were members of the CII where Tarun Das was the director general.

Das is not expected to resign from his post of director general of CII in view of the fact that the ACC chairman�s role is a non-executive post. His office also concurred with this view. Das was in the midst of a CII meeting which will see Rahul Bajaj handing over the president�s post to Arun Bharat Ram.

Corporate observers say the appointment of Das may mollify the FIs who have been irked by the sellout of the Tata stake and the way that the representatives of Gujarat Ambuja have come on board. With foreign cement majors covetously eyeing ACC, the director general of CII may play an effective role in fending them off, they said.    

Mumbai, April 26 
The Bombay Stock Exchange (BSE) sensex roared back to 4792.95 in a 258.96-point leap driven by overnight gains on the Nasdaq and additional margins that scared away the bears into their burrows.

There was confusion over the closing figure of the 30-scrip index after a virus attack disrupted the exchange�s computing system. However, at the end of the day, it was confirmed that the key stock barometer had shot up 5.71 per cent over Tuesday�s finish of 4533.99.

Today�s rally covered a range of old-economy companies such as ABB, Larsen & Toubro, Ashok Leyland and BSES, all of which tested their upper-end price filters.

�The momentum picked up in the second half of the session when operators stepped on the gas and made heavy purchases in select counters,� said Dick H Mody, head of sales at ASK Raymond James, a leading broking house in the city.

He said the aggressive buying was a pointer to the fact that the market sentiment was improving and the optimism was back. The recovery also led to the talk that much-desired �decoupling� of Indian markets from the Nasdaq would happen soon enough because of the realisation that the ground realities, and the fundamentals of companies, listed in the two countries are remarkably different.

Among the other factors which fuelled the buying binge was Tuesday�s modest, but significant, rally on the BSE.

That today was the first day of the new settlement on the National Stock Exchange helped matters further.    

Mumbai, April 26 
The Securities and Exchange Board of India (Sebi) today decided to widen the size of circuit filters � artificial plugs designed to check fluctuation in share values � from 8 per cent to 12 per cent from May 2.

This will apply to 200 scrips, including all A group shares and some from the B1 group. The decision was taken at a meeting of the inter-exchange surveillance group (ISG). The list of scrips, now being drawn up by the Bombay and National Stock Exchanges, will be announced on Thursday.

In an effort to put the long-buyers and short-sellers on an even keel, Sebi said a short seller who does not own a share, or has not borrowed it, will not have to pay carry forward charges.

Sebi executive director Pratip Kar said under the new system, once a scrip hits the 8 per cent price band in either direction, trading will be suspended for 30 minutes. After this interval, the price band will be increased by 4 per cent. If the limits are touched in the last 30 minutes of the session, the cooling-off will only be 15 minutes.

If any of the 200 scrips hits the price bands first on the BSE or NSE, the information will be passed on by e-mail to other bourses, which will then relax their own circuit filters.

Sebi chairman D R Mehta said the measure will provide small investors an exit route when a scrip hits the lower end of the filter. He justified the loosening of controls, saying it was needed at a time when the capital markets were growing in maturity.

However, he ruled out the scrapping of circuit filters in the near future because they serve as an important tools to contain volatility and price manipulation, particularly those caused by speculators.    

Mumbai, April 26 
The FMCG giant, Hindustan Lever Ltd (HLL) has posted a 23.4 per cent rise in net profits for the first quarter of the current fiscal ending March 31, 2000. Net profit soared to Rs 262.61 crore against Rs 212.83 crore in the same period of the previous year.

Apart from the strong bottomline growth, HLL showed a modest movement in its topline when its turnover at Rs 2614.07 crore (net of excise), grew by 7.1 per cent over the same period in the previous year. The overall sales growth of 7 per cent comprised an underlying volume growth of about 6 per cent and price increases of under 1 per cent. The export business had a 5 per cent growth in difficult international trading conditions, HLL said.

FMCG analysts were largely disappointed over the results, pointing out that the company�s topline growth was a matter of concern.

�Considering the rise in topline in the first quarter, it is only a question of time for the bottomline growth to dip. As long as it does not post a strong topline growth, the company will find it difficult to maintain strong rise in its profit levels,� an analyst averred.

The sales growth was led by home and personal care (up 8 per cent), beverages (up 32 per cent) and branded staples (up 28 per cent). Further, the packed tea business registered growth, after a difficult period in the past 2 years due to excise duties.

While ice cream and culinary products recorded flat sales, the continued fall in commodity oil prices adversely impacted oils and fat sales, which were down 37 per cent.

Announcing the results, chairman K B Dadiseth said, �In sluggish market conditions, our domestic businesses of soaps, detergents, personal products, beverages and branded staples (75 per cent of total sales) have shown good sales growth.� He added that while ice cream and culinary sales were flat, the oils and fat sales realisations continue to be affected by the downward trend in prices of commodity oils.    

New Delhi, April 26 
Can India produce successful family business houses like the Ambanis, Tatas, Aditya Birlas or do they have to be split into groups to be run professionally?

The issue has seized the attention of the Confederation of Indian Industry�s (CII) annual session. A section of the members seems to think there should be an exit policy that helps the stodgier families to leave the fold while another feels managing the family, rather their businesses, was more important for the survival of third-generation barons.

The central challenge facing these enterprises is this: Can families remain united and succeed in business? Whether they can or not determines, not least of all, the way the stock markets value them. This can been seen from the fact just three groups � Ambanis, Tatas and the Aditya Birla � have a combined market capitalisation of more than Rs 63,000 crore while that of 16 others tot up to a measly Rs 24,000 crore.

Eicher advisor Subodh Bhargava doubts these firms, often run like personal fiefs, can deliver the goods. �What sort of family business are we talking about? Where the management is sleeping, capital is exploiting labour and future is crying ?� He roots for the system of having professional managers, who can tender expert and unbiased advice.

Professional managers in family-run companies, he says, should rise above coteries, show more courage and take fair decisions. He suggests an exit policy for inefficient family members, just as there is one for blue-collared workers. The problem, he told members, is that every member within the family harbours personal aspirations, and their pursuit often affects the overall performance of business.

Bhargava�s diatribe was countered by Sanjiv Goenka � the RPG Enterprises vice-chairman who remains at the vanguard of one of India�s thriving family firms. Pointing out that 90 per cent of the major trade marks in the US were family-owned and the source of employment for 38 per cent of the workforce, he said it was not appropriate to characterise these businesses as dinosaurs.    

New Delhi, April 26 
Zee is planning to launch three regional channels through Asianet, its recently acquired Malayalam channel, by the end of this year.

Speaking on the sidelines of a seminar on �Media in the 21st Century� at the annual session of the Confederation of Indian Industry (CII), Subhash Chandra, chairman, Zee Telefilms said, �These channels would be launched through Asianet.�

He was, however, not willing to reveal the languages in which these channels would be launched.

Chandra ruled out making any changes in the Asianet brand, adding that the channel has a very strong brandname. He also said that Zee proposed to start a sports channel and three additional English channels. The company would also work with third parties to offer a bouquet of channels to audiences.

Addressing the seminar, Chandra said currently 60 channels are available and the number is expected to go up to 250 channels in the next two years. He said in the near future, the triumvirate of media, information technology and e-commerce will dominate the scenes. He said technology had facilitated growth and improved the content of channels.    

New Delhi, April 26 
What do business wives do while their hubbies discuss the state of business? Dabble in the darker side of occult sciences like witchcraft, tantra and hypnotism.

Making a break with the past when CII annual sessions were meant only for serious business and little fun, the chamber has decided to focus on hypnotism and tantra to promote the cause of � guess what ? � women empowerment.

Calcutta�s Ipsita Roy Chakraverti, who floored the ladies in chiffons and diamonds, said witchcraft or, Wicca as it is known, can change situations and circumstances, with positive and negative effects.

She told the sprinkling of business wives that people were not really aware of the positive aspects of witchcraft. �Women are dubbed witches and are often persecuted.�

Chakraverti said a magic occurs when there is a fusion of person�s deeper sub-conscious and the elements of nature. According to her, even inanimate objects, such as rocks or stones, have consciousness, and alignment of such forces leads to magic. Among those who attended the session were the wives of Tarun Das, Subodh Bhargava, D.S Brar, Vinod Doshi, N. Kumar and president-elect Arun Bharat Ram.    

New Delhi, April 26 
The report of the group of ministers reviewing the sectoral equity caps on foreign direct investment (FDI) will be presented before the Cabinet soon, N.K. Singh, secretary in the Prime Minister�s office, said here today. Inaugurating the seminar on �New FDI Policy: Opportunities and Limitations� organised by the Associated Chambers of Commerce and Industry (Assocham), Singh said the government is also giving final touches to the new Convergence Telecom Bill 2000 in order to boost FDI flow in the infrastructure sector. The Bill will be placed before the next session of Parliament, he added.

The government is also framing the new labour policy which will be based on the recommendations of the National Labour Commission and the Employment Committee of the Planning Commission, Singh said.

However, he admitted that the ratio of actual FDI flows to approvals has been disappointing. �Merely setting up an implementing body is not an answer to sectoral problems which have compounded in the last two years. The key to increasing FDI flow lies in speeding up sectoral reforms and the government is committed to push it at a fast pace,� he added. He also attributed the slackening of inflows to political uncertainty in the last 3 years rather than to a slide in the reforms process.

Taking up sector specific issues, he said while he envisaged an increase in FDI flow in sectors like power, roads and ports in the medium-term, he felt an area that needed attention was the civil aviation.    

April 26 
Wipro Ltd, the infotech major, today posted a net profit of Rs 300.6 crore for the financial year 1999-200 compared with Rs 170.2 crore in the previous year, a handsome rise of 77 per cent.

Sales and other income for the year stood at Rs 2312.9 crore, a 28 per cent increase over the previous year.

Announcing the results, Wipro chairman Azim Premji said his company planned to manufacture high-end server in India and �we intend to become a significant player in the global IT market.�

�We are going to invest aggressively in building our brand.�

He said Wipro�s new plant at Pondicherry with a manufacturing capacity of 1 lakh PCs would become operational in the next six months. The company had invested Rs15 crore in the plant.

Premji said at Wipro Technologies, the largest global IT services business in India, sales and other income grew by 65 percent to touch Rs 1042 crore. Profit before interest and tax was Rs 288.7 crore, a 75 per cent growth over the previous year.

About the $ 500 million ADR issue for overseas acquisitions, Premji said his company had already passed the enabling resolution and �we will take the requisite steps in the near future.�

On the volatility in the share prices of high-tech companies, he said it had become a �global phenomenon�, adding, he was unable to attribute any specific reasons for it.

He said the Indian stock market was partly influenced by the volatility at Nasdaq, but denied that speculators were at work �at least in India.�

Premji said he had no immediate plans to either hive off the IT business or go for a joint venture as �there has to be some merit in changing something that we have been doing successfully.� Premji said he did not care much for the �label� as the richest Indian and would rather like to be known as one of the respected industrial leaders in the country. On why he was not sharing his wealth, Premji said his company�s shares were at one time being quoted at Rs9800 and �would we have shared wealth if we had sold then,� with an obvious reference to downward slide in the recent past.

He said his company�s stocks were �liquid enough� and he did not see any reason to offload them.

DRL turnover up

Dr. Reddy�s Laboratories (DRL) has achieved a turnover of Rs 498 crore, an increase of 15 per cent, and a net profit of Rs 60 crore for the 1999-2000 fiscal. The board recommended a final dividend of 5 per cent.

A company press release said the domestic revenue from the finished dosages contributed Rs 240 crore, a 34 per cent increase. Similarly, the international finished dosages grew by 14 per cent at Rs 79 crore. While sales to Russia and Central European markets grew by 6 per cent, that of other markets grew by 39 per cent and the company was exporting a total 374 products cumulatively.

The exports of bulk drugs recorded a mere 7 per cent growth at Rs 62 crore. However, the sale of diagnostics fell by 17 per cent to Rs 12 crore due to restructuring of the trade channels.

Bata Q1 net down 10%

Bata India Ltd today reported a net profit of Rs 3.96 crore for the first quarter of 2000, a decline of about 10 per cent against Rs 4.29 crore in the same quarter of previous year.

Net sales during the quarter increased marginally by 0.7 per cent from Rs 170.71 crore to Rs 171.89 crore, while gross profit decreased by 1.6 per cent from Rs 9.92 crore to Rs 9.76 crore, with interest cost increasing marginally from Rs 1.54 crore to Rs 1.61 crore.

Company sources said after a board meeting today that a lockout in the Peenya (Karnataka) factory from March 8, 2000, following a strike by the union, had an adverse impact on performance.

Consumption of raw materials and finished goods came down to Rs 112.31 crore from Rs 116.56 crore during the quarter, while excise duty payment increased to Rs 11.80 crore from Rs 11.40 crore.

Other expenditure was down to Rs 36.28 crore against Rs 39.49 crore last year while provision for depreciation was higher at Rs 3.38 crore against Rs 3.17 crore last year.

Philips posts Q1 loss

Philips India Ltd (PIL) has registered a loss of Rs 11.86 crore in the first quarter ending March 31, 2000, as against a profit of Rs 4.46 crore posted in the previous year, following a sharp fall in volumes in the consumer electronics and domestic appliances market.

The company suffered a 21 per cent loss in its sales turnover at Rs 326.2 crore from Rs 395.2 crore in the corresponding period last year, according to the company�s unaudited results. The gross profit also nose-dived to Rs 1.03 crore from Rs 17.87 crore in the previous year.    

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