Bajaj Auto net inches up to Rs 116.3 crore
Reliance Petro maiden Q1 net at Rs 324 crore
Call for stricter norms to regulate mutual funds
RBI to set up forex shops at tourist spots

Mumbai, July 29 
Bajaj Auto Ltd, the two-wheeler major, has reported a 4.7 per cent rise in net profit for the first quarter of the current fiscal ending June 30. The profit is Rs 116.32 crore as against Rs 111.09 crore in the same period of the previous year.

Total sales and other income of the company during this period rose by 16.2 per cent to Rs 1,017.96 crore as against Rs 876.02 crore in the previous year.

Commenting on the results, Bajaj Auto said that rationalisation of state sales tax on vehicles to 12 per cent done in May has resulted in the increase of sales tax by 5-7 per cent approximately. This has reduced the scooter sales.

Due to a slowdown in demand of scooters, the company�s plant at Akurdi, near Pune is working a five day week from June 30, 2000. The position will be reviewed from time to time, it added.

The company disclosed that production of two and three wheelers during the quarter under review was 3,27,075 as against 3,32,974 during the corresponding months in 1999-2000.

Bajaj Auto sold 3,25,360 two and three wheelers in the quarter as compared to 2,97,237 during the corresponding period of last year.

The company Bajaj said that while the sales of scooterettes rose to 19,564 (11,004) with the market share rising to 28 per cent (21 per cent), that of scooters declined to 1,43,303 over 1,69,134, thus showing a decline of 15 per cent. During this period, the company�s market share marginally declined to 63.9 per cent from 65.2 per cent in the previous year.

The three-wheelers� sales rose to 39,440 (37,158). Total vehicles sold by the company rose by 9.5 per cent to 3,25,360 (2,97,237).

Thus barring the scooter segment, the company recorded �growth in volumes and market share in all the segments. The sales of vehicles excluding scooters during the quarter April to June is 1,82,057 as compared to 1,28,103 vehicles sold in the corresponding period last year, a growth of 42 per cent,� Bajaj Auto said.    

Mumbai, July 29 
Reliance Petroleum Ltd (RPL), today declared its maiden operating results. In the first quarter of this fiscal it posted net profit of Rs 324 crore on a sales turnover of Rs 5,983 crore. Based on full year operations, the company is expected to meet the targeted turnover of over Rs 22,000 crore and join the rank of its parent Reliance Industries Ltd as India�s top two private sector companies in terms of sales and profit.

Reliance Petroleum said that the performance has been achieved in a challenging environment with the overall crude oil prices ranging from $ 21 to high levels of $ 31 per barrel during the quarter.

RPL is the seventh largest refinery in the world. With the first quarter performance, it has become the seventh largest private sector company in India in terms of sales and eighth largest in terms of net profit.

During the period under review, RPL processed 5.8 million tonnes of crude. It posted an operating profit of Rs 631 crore and a cash profit of Rs 459 crore.

Commenting on the results, Anil Ambani, managing director, RPL, said, �The performance in the very first quarter of commercial production is encouraging, considering the high crude prices and sharp volatility during the quarter.�

The project cost of RPL was Rs 14,250 crore. Reliance group holds around 64 per cent of the equity, international investors 7 per cent, domestic financial institutions around 9 per cent and retail public almost 20 per cent in the project. Demand for petroleum products in the domestic market is encouraging, said the company. Against over 95 million tonnes of consumption of petroleum products in 1999-2000, demand for the current year is estimated at around 105 million tonnes.

Among the petroleum products manufactured by the company, naphtha, reformate and propylene are captively consumed, ensuring assured offttake. It is estimated that captive consumption by group companies will account for around 25 to 30 per cent of the total production.

During the quarter, while the company provided Rs 172 crore as interest, depreciation was put at Rs 135 crore. The earnings per share for the quarter was Rs 0.75. Based on the quarterly reports, exports of RPL products was Rs 479 crore, placing it among the top 10 manufacturer exporters from the country.

Birla Yamaha Q1 net Rs 2.27 crore

Yash Birla group firm, Birla Yamaha Ltd posted 10 per cent growth in net profit to Rs 2.27 crore as against Rs 2 crore in the corresponding quarter last year. The net sales of the company stood at Rs 19.59 crore (Rs 18.14 crore). The profit before tax was Rs 3.96 crore. The company provided for Rs 31.50 lakh (Rs 32 lakh) as interest, Rs 58 lakh (Rs 52 lakh) for depreciation and Rs 80 lakh (Rs 90 lakh) towards provision for tax.

ICCL revenue up 54%

Indian Charge Chrome�s revenue for the first quarter of the current fiscal is up 54 per cent to Rs 38.05 crore compared with Rs 24.68 crore in the corresponding period last year. The company has reported an operating profit of Rs 3.15 crore for the quarter ending June 30.

Ramco Systems earnings up 72%

Ramco Systems earned Rs 27.06 crore in the first quarter of the current fiscal, 72 per cent higher than the corresponding period last year. Global revenue of the company has shown a 60 per cent growth from the corresponding last quarter�s $ 9.76 million.    

Calcutta, July 29 
Industrial Investment Bank of India (IIBI) chairman Basudeb Sen today recommended tightening the mutual fund regulations as a booster to the industry.

Addressing a seminar on �Mutual Funds: Shaping the Future Indian Financial System� organised by the Bharat Chamber of Commerce, here today, Sen said, �The mutual funds have a bright prospect and can play a vital role in reshaping the financial system of the country in the future.�

At present only 2 per cent of the population invest in the mutual funds as compared to 35 per cent in developed countries like the US.

Sen pointed out that the growing presence of mutual fund has influenced changes in the established market practices like corporate governance which has undergone radical changes.

Product innovation is a key to strengthen the mutual fund industry, he added. Currently, the domestic mutual fund industry offers a wide range of products to the investor.

While admitting that a number of changes have taken place to accommodate the needs of this nascent industry, Sen said that a lot remains to be done.

The upcoming new businesses can pose a threat for the mutual fund industry if the required changes are not accommodated by the policy makers, said Sen. �A symbiotic relation between the various players in the financial market , corporate and the policy makers is critical for the survival and growth of this industry.�

Unit Trust of India will shortly put in place an inter-connectivity facility that will bring the services to the door step of the customers, revealed M M Kapoor, executive director of UTI, at the conference.

He emphasised the need for innovative technology and quality customer service for meeting the growing demands of the customers.

The biggest threat facing UTI and other mutual funds is the competition among the major banking institutions. UTI will invest in technology upgradation to counter this threat, Kapoor said.    

Hyderabad, July 29 
Foreign exchange business in the country is set to undergo a change with the Reserve Bank of India planning to set up liberal foreign currency exchange outlets across the country.

RBI executive director P.R. Gopala Rao told reporters here today that the central bank would issue two categories of licences for money changers�full fledged money changers (FFMC) and restricted money changers (RMC). While the entry level capital requirement for FFMCs was fixed around Rs 25 lakh, for RMCs it was nil.

�We aim to allow operation of all such bureau at all tourist spots to facilitate foreign tourists,� Rao said.

According to Rao, RBI has decided to start retail marketing of government securities to involve individual investors instead of banks and financial institutions. It will take the help of primary dealers to boost the confidence of retail investors. The 13-member Primary Dealers Association of India will be expanded to create an awareness and also provide easy access to individual and corporate investors to government securities.

At present, the government securities (gilts) market was dominated by banks and financial institutions, he said.

�The banks held 67 per cent while insurance companies retained 20 per cent of the total volume of Rs 4,50,000 crore in gilts. Retail investors hold only 10 per cent,� he said.

Market borrowing

Quelling apprehension that the recent liquidity-tightening measures of the Reserve Bank of India would affect the government�s market borrowing programme, Rao said the recent experience in private placements reveals that there is still an underlying appetite for long-term loans.

Given such a conducive environment, the government would continue to focus on elongating the maturity profile of its securities and achieve a balance between short-term and long-term papers in a cost-effective manner.

The central bank, as the debt manager of the government, would pursue appropriate policies to help the government achieve this objective, Rao said.

The executive director said the net market borrowing programme for the current fiscal was budgeted at Rs 76,383 crore. With repayment obligations at Rs 41,321 crore, the gross borrowing requirements of the central government amount to Rs 1,17,704 crore.

So far, the government had raised Rs 56,683 crore, which is 48 per cent of the total targeted borrowing.

According to Rao, in all likelihood market borrowings would not exceed the budgeted amount as the relative budgetary variables had been estimated pragmatically making it possible for the government and the Reserve Bank to continue with its policy objectives.

On the recent hike in Bank Rate and the cash reserve ratio (CRR) by RBI, he explained that the measures were warranted by technical factors to address what were otherwise construed as transitory developments in the market.

He said there was an uptrend in the yields of government paper even before the measures were announced. He urged the market participants to rationalise the developments systematically.

Dwelling on the role of primary dealers, Rao said primary dealers should pay a role in stabilising the markets for government securities.

Pointing out that adequate support was extended by RBI to primary dealers, he advised them to gradually become self-dependent and explore additional sources of funds. Rao urged primary dealers to enhance their lending and borrowings through the repo market. Apart from imparting liquidity, this would help enlarge the secondary repo market.    


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