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Addressing shareholders at the annual general meeting (AGM) in Jamnagar today, company chairman Dhirubhai Ambani said RPL meets all conditions laid down by the government and is, therefore, eligible to market a host of petro products once they go off control less than two years from now.
Currently, these items are marketed by state-owned oil companies under the administered pricing mechanism (APM). �As soon as the marketing of controlled products is freed, Reliance Petrochemicals will make appropriate arrangements to ensure that it is ready for it,� Ambani told shareholders.
The RPL chief lifted the spirits of shareholders when he told them that can expect a maiden dividend in the current financial year. If and when that happens, it will be the first company to do so in the very first year of starting operations.
According to him, RPL and Reliance Industries (RIL) will be the top two private sector companies in the country in terms of performance on most financial parameters; they will also be among the top three manufacturer exporters from India in the current year. Reliance Petroleum is already one of the top five private sector companies in India with market capitalisation of over Rs 27,500 crore ($ 6 billion).
Ambani said Reliance Petroleum turned in healthy first-quarter numbers to reaffirm its leadership status despite tough conditions in the industry. It reported sales of Rs 5,983 crore (US $ 1,339 million) and a net profit of Rs 459 crore.
More important, its production saved the country a staggering Rs 1,104 crore ( US $ 247 million) in foreign exchange � an amount that would have otherwise been spent on imports.
RPL currently sells the five controlled products at import parity prices to Indian Oil, HPCL and BPCL.
Others are marketed directly by the company. Between 25 and 30 per cent of its production is absorbed as captive consumption by group companies.
Ambani also indicated that Reliance Petro will now go ahead with the use of risk-management instruments to hedge the price-risks in feedstocks and products. The government recently allowed companies to hedge their oil exposures.
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The change in technology, having already begun in the southern region, will soon be taken to other parts of the country.
�Technologies have a lifespan and need to be replaced. The code division multiple access is the latest one, suited to rural telephony. We have completed field-trials, and intend to install it to deepen the penetration of rural telephones in the country,� sources in Department of Telecom Operations (DTO) said.
Earlier, the government failed to meet its 1997 deadline for providing a telephone each to 6,04,374 villages, home to 65 per cent of the country�s population, but it wants to wrap up the unfinished job in two years. At present though, only 3.5 lakh villages have a telephone.
The target is to bring all villages on the telephone network as part of a larger effort to raise the abysmally low rural tele-density � the ratio that defines the number of telephones per thousand people � from 0.4 per cent to 4 per cent.
N. Vittal, the chief vigilance commissioner (CVC) and a one-time DoT secretary, told a function in the capital today that it would take a joint initiative from the government and private companies to achieve the goal of putting all villages on the country�s tele-network.
�Also, the technology should be made neutral. Who ever wants to set up a public telephone in rural areas, should be able to do so,� he added.
Communications minister Ram Vilas Paswan had recently announced that the 2,11,000 village telephones using MARR will gradually switch over to new technology options. �All attempts will be made to replace at least 1.1 lakh defective village public telephones (VPTs) working on multi-access radio relay system this year with the appropriate technology, including Wireless in Local Loop (WLL),� he said.
According to him, the MARR analogue technology used earlier did not work well, and there were several cases of repeated failures.
The WLL technology was considered more useful given the fact many villages are tucked away in far-flung areas that are at most times inaccessible, even inhospitable.
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Soonawala had served Tata Sons as finance director for 11 years till his retirement on June 27. The board then appointed him as a non-executive director effective June 28.
In a statement, the Tatas said: �The appointment of Soonawala as vice-chairman of Tata Sons is a recognition of the tremendous contribution made by him during his tenure of over 32 years with the Tatas, guiding the financial operations of the group companies with transparency and enabling Tata Sons, the principal investment holding company of the Tatas, to consolidate their holdings in the major operating Tata companies.�
However, corporate observers were surprised by the move, despite the fact that the appointment is non-executive in nature.
Soonawala is deputy chairman of Tata Tea, vice-chairman of Tata Investment Corporation and Forbes Gokak and a member of the board of several Tata companies.
Bombay House observers say that the appointment is a recognition of the services rendered by him during his tenure as finance director in Tata Sons, that saw the Tatas increasing their holdings in almost all their core group companies.
Besides, Soonawala is considered to be a close confidante of Ratan Tata and is always seated next to him at every annual general meeting (AGM).
In fact, today�s move to create the new post of vice-chairman, is explained by his proximity to the Tata boss.
Moreover, Tata observers also point out that during the Ajit Kerkar imbroglio, Soonawala was the main pivot, strategising for the Tatas from behind the scenes, while Nani Palkhiwala was the public face.
Incidentally, Soonawala has always been known to keep a low profile, never being at the helm of any Tata company.
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According to a survey by the National Association of Software and Service Companies (Nasscom) on infotech-enabled service released today, customer interaction services are expected to generate Rs 750 crore in 2000-01 as compared with a revenue of Rs 400 crore generated by this segment in 1999-2000. Other services that have huge potential, are content development and animation, which are expected to grow from Rs 820 crore in 1999-2000 to Rs 1600 crore in 2000-01, whereas back office operations are expected to see a growth of over 40 per cent.
While releasing the survey figures, Nasscom president Dewang Mehta said, �The 66 per cent growth during 2000-01 is the highest ever growth of infotech-enabled services in India and we expect even higher growth rates in the future. According to our survey, two most promising segments this year are customer interaction services including call centres and content development and animation.�
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The shareholders also approved a new employees stock option scheme for senior managers of the company.
The stock split is expected to increase the number of shares of the company, resulting in better liquidity.
Dabur India had earlier reported a 35.8 per cent growth in net profit at Rs 7.15 crore on a sales turnover of Rs 247.90 crore for the quarter ended June 30, up from a profit of Rs 5.27 crore in the previous corresponding period.
The profit excludes non-recurring income of Rs 21.17 crore received from the sale of its stake in General De Confetaria Ltd.
Dabur also inducted former Hindustan Lever chairman S M Datta as an independent director on its board.
Chairman V.C Burman said that the company has set up an audit committee, shareholders� and investors� grievances committee, remuneration committee and compensation committee.
Burman also made a presentation on Dabur�s initiatives in the field of information technology. The company is set to foray into B2B and B2C transactions, he informed.
On the research and development front, he said, �Dabur has taken major strides in the field of development of new chemical entities and new drug delivery systems.�
He added that one of the new molecules is already undergoing clinical trials and another two are in advanced stages of development.
He further informed that Dabur has developed many new products in personal care and health care which are set for launch during this year.
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The tea bigwigs like Tata Tea, Hindustan Lever Ltd, Harrison Malayalam and the Peria Karamalai group are sending more tea this year to Calcutta auctions than they have in previous years.
Even the B.K. Birla group company Mangalam Plantations and Assambrook which joined the league only this year, are sending their produce to Calcutta auctions.
The teas are also fetching higher prices than in the three south Indian auction centres � Cochin, Coimbatore and Coonoor.
While tea prices at south Indian auctions are ruling at Rs 37-40 per kg, the same tea at Calcutta auctions fetches Rs 50-54 per kg.
Senior members of the city-based broking community said, �The big tea companies want to develop north Indian auctions as alternate centres for selling their teas. They are presently testing the waters. Moreover, they get a ready market for the orthodox teas.�
Commenting on the higher price realisation of south Indian teas at Calcutta auctions, the brokers said that they do not mind paying a little more if they get the tea at their doorstep.
�We get export orders for south Indian tea to countries like Russia, Libya and West Asia, but we do not have to go there to buy the tea. The companies also take care of the transport cost and freight charges,� they said.
While in 1999 the offerings of south Indian teas was a paltry 1.4 million kg for the entire year, it has already touched 2 million kg in the first six months of the current year. However, while last year south Indian teas fetched a price of Rs 72 per kg, this year the price hovers around Rs 50-54 per kg.
The tea traders pointed out that demand for south Indian teas is gradually being created in the north Indian markets.
Companies like Tata Tea, HLL are more into packet teas. But the demand in the packet tea segment is not increasing in a manner as was envisaged by the tea industry. �So the big companies like Tata Tea and HLL are trying to promote their south Indian productions in north India,� the brokers said.
HLL has 11 tea estates in south India and Tata Tea has 28 tea estates spread over Kerala and Tamil Nadu.
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US $1 NA HK $1 Rs. 5.75* UK �1 NA SW Fr 1 Rs. 25.45* Euro NA Sing $1 Rs. 25.85* Yen 100 NA Aus $1 Rs. 24.95* *SBI TC buying rates; others are forex market closing rates
Calcutta Bombay Gold Std (10gm) Rs. 4550 Gold Std (10 gm 4490 Gold 22 carat Rs. 4295 Gold 22 carat 4155 Silver bar (Kg) Rs.7875 Silver (Kg) 8005 Silver portion Rs. 7975 Silver portion 8010
Sensex 4702.52 -61.11 BSE-100 2393.7746 -28.18 S&P CNX Nifty 1456.15 -11.50 Calcutta 128.34 -1.24 Skindia GDRNA 765.34 -6.95