Vijith Pujari
Friday, January 27, 2006

Steel strikes wings on consolidation hopes

Steel shares spurted in a broad-based rally soon after news trickled into the market that Mittal Steel will announce a bid to buy Arcelor.

Shares of Sail which had dropped about 2% to Rs 53 in mid-afternoon trade, due to dismal Q3 results, staged a solid rebound later. The stock was up 7.6% to Rs 58.40. A staggering 1.2 crore shares changed hands in the counter on BSE.

Tata Steel jumped 7.8% to Rs 392, Lloyds Steel rose 13.7% to Rs 11.25, Essar Steel jumped 10% to Rs 42.20, Uttam Galva Steel rose 10% to Rs 38.80, Jindal Stainless rose 8% to Rs 98, Bhushan Steel surged 6.8% to Rs 152, and JSW Steel gained 5% to Rs 208.

Tata Steel rose on high volume of 23 lakh shares.

In Europe, trading in Mittal Steel and Arcelor was suspended today following reports that Mittal Steel was set to announce a bid for Arcelor. Shares in UK-based steel firm, Corus, jumped 10.7% and those in Germany's Thyssen added 8%.

An expected acquisition at the global level raised hopes of a consolidation in the steel sector which in turn raised hopes that global steel prices will hold firm. It may be recalled that global steel prices had weakened over the past few months. Impact of large-scale production cut taken by European and American producers was negated by high growth in Chinese production, resulting in softening steel prices in the global market.


FII inflow surges

Net inflow of Rs 820 crore on 25 January

FIIs pumped in a net Rs 820 crore on Wednesday (25 January) - as compared to an inflow of Rs 42.10 crore on Tuesday (24 January).

It was the biggest daily inflow since 4 January 2006. On 4 January, FIIs had pumped in Rs 912 crore.

The net inflow of Rs 820 crore on 25 January was a result of gross purchases Rs 2,631.20 crore and gross sales Rs 1,811.10 crore. Sensex jumped 136 points on 25 January on firm global markets and as oil prices slipped from a 4-1/2-month high of $69.20 per barrel.

The cumulative FII inflow till 25 January has reached Rs 3,158.60 crore. This is against an inflow of Rs 9,335 crore in December 2005. The inflow in December 2005 included allotment of Rs 2,300 crore to FIIs in the ICICI Bank public issue.

In January 2005 (till 25 January), FIIs had sold shares worth a net Rs 373 crore.


Bonus issue denial floors United Phosphorus

United Phosphorus plunged 4.6% to Rs 277 after the company denied reports that it may announce a bonus issue.

A total of 96,547 shares changed hands in the counter on BSE.

The stock had spurted 10.6% on Wednesday (25 January) to Rs 290.60 boosted by media reports about the bonus issue. Last couple of months saw a sustained uptrend in the scrip. From a low of Rs 208.75 on 24 January, the stock had surged to Rs 262.70 by 24 January 2006.

At present there is no proposal before the board of directors for issue of bonus shares, the company clarified in a statement to the stock exchanges.

United Phosphorus is a leading manufacturer of crop protection products, with a wide range of products that include fumigants, fungicides, insecticides, rodenticides and herbicides. The company ranks fourth amongst the generic agrochemical companies in the world. It also manufactures chlor-alkali products, industrial chemicals and specialty chemicals.

United Phosphorous is currently among the top five generic pesticides companies in the world. A few months back, it acquired Agvalue Inc in the US, Cequisa in Spain, and SWAL - a small agrochemicals company - in India, with the aim to bolster its position in the respective markets.

UPL reported strong Q2 September 2005 numbers. The consolidated profit after tax jumped 51% at Rs. 47.15 crore. Consolidated sales rose 23% to Rs. 437.07 crore.


Dabur India Board allots 1:1 Bonus Shares

Dabur India Ltd has informed that the Board of Directors of the Company at the meeting held on January 27, 2006, inter alia, have also allotted 28,66,51,392 equity shares of Re 1 each as Bonus Shares in the ratio of 1:1 to the shareholders holding shares on the Record Date of January 20, 2006.

Further the Company has informed that the Board of Directors of the Company have unanimously approved the Scheme of Amalgamation and Arrangement (Scheme) of Balsara Hygiene Products Ltd (BHPL), Besta Cosmetics Ltd (Besta) and Balsara Home Products Ltd (Balsara Home) with the Company and their respective shareholders under Sections 391 to 394 and all other applicable provisions of the Companies Act, 1956.

The Scheme as approved by the Board is subject to such approvals as may be required including that of the Stock Exchanges, Jurisdictional High Courts, shareholders and creditors and the permission or approval of any other statutory or regulatory authorities, which by law may be necessary for the implementation of the Scheme.


Subex Systems to mop up 10 mn dollar via GDR issue

Subex Systems Ltd has announced the issue of GDRs for an aggregate amount of USD 10 Million to finance potential acquisitions.

Commenting on the proposed issue of GDRs, Mr Menon said that Subex is now recognized as a leading global player in the telecom Revenue Assurance and Fraud Management software products market and aims to consolidate its position further. In pursuit of this objective, the company is in the process of expanding and improving the product offerings by acquiring suitable companies in the space. The company believes it is prudent at this stage to raise funds for acquisitions abroad through the issue of GDRs in view of the prevailing market conditions, improved performance of the Company and the positive outlook for the Companys business. Subex is actively exploring acquisitions and the proceeds from this issue will be used to fund the acquisition program, in part or in full.

Further the Board of Directors of the Company have decided to convene an EGM on February 25, 2006, to consider the raising of funds upto USD 10 million by issue of Global Depository Receipts / FCCBs / Securities convertible into equity shares or such other suitable instruments.


ANG Exports, Fuwa Engineering to set up JV company in India

ANG Exports Ltd and Fuwa Engineering Company Ltd., China have entered into Memorandum of Understanding (MOU) and agreed to set up a Joint Venture (JV) Company in India for the Manufacture of Trailers, Trailer Axles and other Components, with an investment of USD 6 millions in next 12 months. The Project is likely to start Commercial Production in next 12 months.

A new Company (subsidiary of the Company) is being incorporated in the name of ANG FUWA Ltd or with any other nomenclature as available in India. FUWA will 10.5% of Equity in the Proposed Joint Venture Company.

Fuwa shall appoint one Director in the Board of the new Company.


What is a demat account & a DP?

AN INVESTOR can hold securities either in the form of physical paper certificates or in electronic form. A demat account helps an investor hold securities in the electronic form. The conversion of securities in to the electronic format from a physical format is called ‘Dematerialisation’, referred to as Demat in short. These securities in electronic format are held on the investor’s behalf by an entity called a Depository. This depository interfaces with investors through its agents called depository participants (DPs). Investors are required to open an account, called the demat account, with depository participants to have their securities held in the electronic format. Holding securities in an electronic form provides many advantages over holding them in the form of physical certificates. The holding of securities in electronic form has been credited with transforming the Indian stock markets.

What is the latest controversy about multiple demat accounts all about?

The scam, referred to as the Demat IPO scam, is about a few investors who opened many accounts in their name with various DPs. They did this so that, they could make multiple applications for shares in a stock IPO to secure more shares in the allotment process. In the retail segment, allotment is made on a proportionate basis. Therefore, the chances of higher allotment increases if the number of shares applied for is high.

Can investors not have multiple demat accounts?

As of now, the law provides no restrictions on the number of accounts that an investor can open with a single DP. There are also no restrictions on the number of DPs one can open an account with. However, some DPs do impose restrictions on their own and limit the maximum number of accounts to five. In fact, in several cases, it becomes necessary to open multiple accounts. For instance, if an individual holds securities in his name alone and also holds some securities jointly with his wife, he will have to open two demat accounts reflecting the ownership pattern.

What was wrong with the alleged scamsters opening multiple demat accounts then?

The opening of multiple accounts is justified only for genuine reasons as those specified above. However, in this case, the multiple demat accounts were opened in order to put in multiple applications in the retail segment of the IPO to get a larger proportion of share allotments. There was also violation of the rules relating to the IPOs. Investors are specifically forbidden from putting in multiple applications. Banks too were hoodwinked in the process. The people being indicted also allegedly opened several bank accounts, cheques were issued from these bank accounts at the time of share application. Opening multiple demat accounts also enabled these people to access funding for IPOs, since an individual cannot borrow more than Rs 10 lakh for a capital market investment, borrowing through fake names enabled them to borrow several times more than Rs 10 lakh. Moreover, in several cases bank accounts were opened in fake names and fake addresses were given.

Why were DPs and banks not able to spot these malpractices?

The investigation is on and the exact details would emerge in time to come. However, prima facie, it does appear that both the banks and the depository participants did not follow what are called ‘Know your client’ (KYC) norms. As per these norms, banks and DPs are supposed to take adequate care and ask for adequate information before opening a customer’s account. Some laxity on their part could have enabled the accused to open and use their multiple demat and bank accounts. It has also been reported that these parties perhaps used fake permanent account numbers to open multiple bank accounts. In the case of demat account, an investor needs to furnish proof of identity, proof of address and a copy of one’s photograph.


Reliance, Bechtel seen in JV for infra projects

THE Mukesh Ambani-controlled Reliance Industries (RIL) plans to foray into the high-end engineering and infrastructure sector. In a significant development, RIL is learnt to have formed a 50:50 joint venture with US-based engineering, construction and project management giant Bechtel to execute engineering and construction projects in the domestic and international markets.
RIL sources said that the RILBechtel JV will bid for largescale construction and engineering projects in oil and gas pipeline, chemical, power and refinery sectors. The JV is currently handling engineering and civil contract work for the mega refinery being built by Reliance at Jamnagar and will soon take up other projects, sources added. Foster Wheeler, Exxon Mobil and UOP are the technical collaborators for RIL’s Jamnagar export refinery. Incidentally, the American engineering giant was also instrumental in setting up RIL’s first refinery project at Jamnagar. The new refinery will crack crude oil that will spew out jet fuel, diesel and gasoline for export in the overseas market where demand exceeds supply. The refinery business has been a huge cash cow for RIL.
Historically, RIL has set up a new company or a joint venture for any new project or business it has planned. Be it the first refinery project at Jamnagar or the telecommunication project. RIL and Canada-based Niko Resources partnered in the oil and gas exploration project at Kakinada off the Andhra Pradesh coast. It also had a JV with British Gas for Panna-Mukta oil fields.
Analysts said Reliance’s move to partner with Bechtel makes sense as infrastructure is a growing sector, with the country likely to witness large projects in the near future. Global brokerage major Merrill Lynch recently said that India is likely to see infrastructure spend of $109bn in the ’06-08 period, a 61% rise over the ’03-05 period. The investment will be in oil and gas, telecom, railways, roads, airports and ports, Merrill Lynch said.
ET had recently reported that RIL is considering a major foray into the special economic zone (SEZ) sector, as part of its core sector expansion. It plans to set up big real estate projects in the SEZs and is considering townships in Delhi and Mumbai.

Reliance open to FII interest in subsidiary’s IPO

RELIANCE Industries, India’s largest private company, is likely to allow foreign investors to take part in the proposed initial public offer of its subsidiary, Reliance Petroleum, media reports from Switzerland said late Wednesday quoting chairman Mukesh Ambani. ”According to Indian rules, 60% of the IPO can be allocated to foreign institutional investors. We are open to considering interest from all investors,” Mr Ambani is reported to have said on the sidelines of the World Economic Forum in Davos.
Reliance Industries earlier said it plans to float a public issue of around Rs 5,000 and Rs 6,000 crore by the first half of ’06-07. The issue would be the second largest public offer by a private Indian company after ICICI Bank’s Rs 8,000-crore issue late last year. The proceeds from the offer will be used to part finance Reliance Industries’ plan to build a new refinery at Jamnagar.
Reliance is building an exportoriented refinery with an annual capacity of 27m tonnes and a polypropylene plant with a capacity of 1m tonnes per annum, in a special economic zone in Jamnagar.
Separately, in a letter to shareholders, Mr Ambani said that work on the new refinery has already started. “As I promised to you in the last AGM (annual general meeting), work has already begun to establish a new refinery at Jamnagar,” he said in the letter which was posted on the company’s website.
“This refinery is proposed to be set up in RIL’s (Reliance Industries) wholly-owned subsidiary, Reliance Petroleum, which will commence operations by ’08-09,” he added. The project cost of nearly $6bn will be financed through loans of $3.5bn and equity of $2.5bn, the letter said.
Referring to Reliance Industries’ growth plans, Mr Ambani said that the company shall aspire for global leadership in the petrochemicals and refining business.
“In these businesses, we shall look at inorganic growth opportunities which are strategic and where RIL is able to unlock greater value for its shareholders,” Mr Ambani said in the letter.
Reliance had earlier announced its plans to participate in the retail sector. It is scheduled to invest over Rs 3,315 crore, or $750m, to build a nationwide retail store chain.
Last edited:


Vijith Pujari
Saturday, January 28, 2006

Bajaj Hindusthan raises $255.6m in overseas issues

MUMBAI: Sugar producer Bajaj Hindusthan said on Friday it had raised $255.6m through a GDR issue and convertible bonds. The company issued 16.7m GDRs, each priced at $8.12, to raise $135.6m, while $120m was raised in convertible bonds, Bajaj Hindusthan said in a statement. The zero-coupon five-year convertible bonds have a conversion price of Rs 465.40 per share. — Reuters


HC stays Federal, Ganesh Bank merger

THE Bombay High Court on Friday ordered a stay on the proposed takeover of Ganesh Bank of Kurundwad by the Kerala-based Federal Bank. Ganesh Bank amalgamated into Federal Bank since January 25. This is the first time that a court has passed a stay order on the merger under a moratorium scheme. Ganesh Bank, based at Kurundwad in Kolhapur district of Maharashtra, had been placed under a moratorium by the Centre on January 7.
The moratorium was placed after Ganesh Bank’s net worth had turned negative and the bank was unable to unveil a credible plan to infuse capital.
In this position, Ganesh Bank could not undertake banking business and disbursal of deposits was limited to Rs 5,000 per depositor during the moratorium period. Subsequently, the RBI came out with an amalgamation scheme for the takeover of Ganesh Bank by Federal Bank.
On January 24, the RBI said that the branches of Ganesh Bank would function as Federal Bank branches from January 25 (Wednesday). Sources said a few employees of Ganesh Bank had moved the court against the moratorium and takover by Federal Bank.
Federal Bank officials said they were planning to approach the Supreme Court against the high court decision. An RBI spokesperson said that the central bank would be able to comment only after getting a copy of the court order. Set up in 1920, Ganesh Bank had 32 branches in Sangli, Kolhapur (Maharashtra) and Belgaum (Karnataka) districts.

Federal Bank prices GDR at Rs 175

FEDERAL Bank on Friday pr-iced its global depositary receipts (GDRs) at $3.97 per GDR, which works out to around Rs 175, reports Our Mumbai Bureau. This was at a discount of 5.7% to Federal’s closing share price of Rs 185 on local stock exchanges. The bank’s overseas float generated a demand of around $600m as against the book size of $80m.
The bank issued 1.8 crore GDRs (each GDR is equivalent to one share), which has raised the paid-up equity capital to Rs 83.4 crore. The stake of the bank’s largest shareholder ICICI Bank has come down to around 8%. In December ‘05, ICICI Bank had brought down its holding from 21% by selling its shares in the secondary market to foreign funds such as Goldman Sachs and Kuroto Fund.
After the sell-off, ICICI Bank still remains the largest shareholder in the bank.
ICICI Bank has signed a deal with International Finance Corporation (IFC) to offload the balance 8% stake for $50m. The GDRs of Federal Bank will be listed on the London Stock Exchange (LSE). The depositary bank for GDR holders is Deutsche Bank Trust Company Americas, while ICICI Bank will be the domestic custodian.
“There was a good demand from the US, the UK, the Middle East and Far East,” said a bank official. Shares of Federal Bank ended 4.3% higher on the bourses. It opened at Rs 178, touched a high of Rs 186 before closing at Rs 185.


Hexaware to invest Rs 350cr in Chennai campus

MUMBAI-BASED software services company Hexaware is building a 1.2m sq ft campus with a capacity for 11,000 people at Chennai with an investment of Rs 350 crore, reports Our Mumbai Bureau. Located at the IT Park in Siruseri, Hexaware Campus will be a state-of-the-art facility spread across 27 acres of land that can accommodate more than 11,000 software professionals. SIPCOT has developed an 800-acre IT park at Siruseri. A world-class six-lane IT corridor is being constructed through a special purpose vehicle with private sector participation to propel investments in IT and ITeS. This campus has also received approval from the Union ministry of commerce granting SEZ status to the facility.
“Chennai has been a very important part of our growth strategy,” said Atul Nishar, chairman, Hexaware Technologies, on the occasion of Bhumi Puja in Siruseri. “We have greatly benefited from the pool of software technology expertise in the region. With the development of our Campus, Hexaware will provide job opportunities for additional 9,000 people in the next five years. We intend to continue our rapid expansion in Tamil Nadu, testimony to which is this prestigious 1.2m sq ft campus,” he added.
The ergonomics for the campus is ‘Inspirational Space’ and will be one of the largest green campuses in India. It will be in compliance with international environmental quality standards and will reduce or eliminate the negative impact of buildings on the environment and occupants.


Perfetti may go for Rs 20-crore expansion of Chennai plant

PERFETTI Van Melle is poised for the biggest expansion plan in India this year. The Italian confectionery major, which has a 30% share of the market, has earmarked Rs 20 crore for expansion of its Chennai plant. “We will be investing one of our biggest amounts in the Indian market this year, and a part of the investment will be used for developing new products and technologies,” Perfetti MD Stefano Pelle told ET. The company is also evaluating the possibility of setting up a new facility in Uttaranchal.
Mr Pelle said the idea was still in the nascent stage and nothing
has been finalised. Perfetti plans to expand its existing capacity of 40,000 tonne by about 20%-25%.
For now, Perfetti is high on local formulations and plans to foray into new segments in ‘06. The company is looking at launching new products and brands to enter into and consolidate its position in the local candy, eclairs and sugar-free confectionery markets.
This may also include Ayurvedic formulations specific to the Indian market. The confectionery major has already tried in Happydent White, Chlormint and Fruit-tella — it has also introduced some innovations in Fruit-tella, exclusively for the south Asian market.
Mr Pelle expects the rechristened version, Foot pop, to do exceedingly well in the Indian market. “There are still some segments where we don’t have a strong presence. In ‘06, we intend to get a foothold in all segments and consolidate our position in other markets,” Mr Pelle, who is also VP & COO of the Russian and South Asia Business Unit, told ET.
The company, which has, till date, invested over Rs 500 crore in India, sees the trend continuing. The company plans to continue with its innovations. In ‘04, Perfetti had launched 13 new products and variants, followed by another seven in ‘05. Right now, the confectionery major has one brand each in the local candy and eclairs market — Chatar Patar and Chocotella, respectively.
At present, Perfetti produces and markets some of the bestselling brands in the Indian market such as Alpenliebe, Center fresh, Cofitos and Chlor-mint. The Rs 500-crore company has two production units, one each in Manesar in the NCR, and Chennai.


ACC firms up under Holcim’s control

ONE year later, the change is palpable at Cement House, the ACC headquarters in Mumbai. It was in January ’05 that Holcim, the world’s No 2 cement player, teamed up with Gujarat Ambuja to buy a majority stake in ACC. Holcim bought 67% of Ambuja Cement India, the holding company of ACC, while Gujarat Ambuja, which held a majority in the company, saw its stake fall to 33%.
ACC, one of India Inc’s prized jewels, and an attractive target for everyone from Nusli Wadia to France’s Lafarge, became a unit of a MNC giant. The change seems to have done ACC a lot of good. There is a new management on board. Gujarat Ambuja Cement (GACL) chairman NS Sekhsaria is the new chairman of ACC, while Holcim’s country representative Paul Hugentobler is the deputy chairman.
New cost initiatives are being undertaken and old, unrelated businesses are being junked. Analysts said Holcim’s emergence as a majority shareholder a year back has worked in favour of ACC’s growth. “ACC, due to its legacy, is not among the most efficient cement producers in India. However, a stream of management initiatives, taken during the past year to modernise plants and improve operating efficiencies, have helped the company to reduce cost,” stated a recent CLSA report on ACC. The management’s ongoing efforts will help save an estimated Rs 50 crore a year from the next year onwards, the report added.
Industry speculation has been mounting that Holcim is close to buying out the Sekhsaria-Neotia family’s stake in Gujarat Ambuja to become India’s largest cement company. Such a move will help ACC as it could learn from Ambuja’s operational efficiencies. Meanwhile, Holcim is seeking more management say in ACC’s daily operations. ACC has already decided to change its financial year-end from March to December to tune in with Holcim’s accounting period. ACC also exited many of its non-core activities.
ACC reported almost a fourfold rise in net profit at Rs 192.5 crore for the quarter ended December 31, ’05, compared to Rs 53.1 crore for the corresponding quarter last fiscal. However, ACC’s power and fuel costs rose 24% in the December quarter and freight costs climbed 56%. Cement sector analysts said that freight cost rise could hit hard unless the truck overloading issue is sorted out. “Logistics play a crucial role in cement business. This is one area where GACL has immense strength. The appointment of Mr Sekhsaria as the chairman of ACC will bring further synergistic benefits to the ACCGACL-Holcim trio,” an analyst with Kotak Securities said.
ACC is working on various cost-saving and efficiency improvement measures in various plant locations which analysts say should see lower total costs in calendar ’06 compared to ’05. Holcim’s management control has accelerated the restructuring process which the No 2 Indian cement firm had undertaken two years ago. The company has hived off the non-core refractory business and its 50% holding in Everest Industries and booked Rs 280 crore exceptional gains. The merger of cement subsidiaries Bargah and Damodar has simplified the company structure.
The next leg of restructuring will involve ACC selling its two engineering arms — ACC Machinery Company and ACC Nihon Casting. ACC officials said that Holcim has a stated alternative fuel and raw material (AFR) policy, under which it has developed expertise in the usage of alternative fuels like rice husk, used tyre and municipal water to replace coal. Holcim’s experience will be implemented in India to benefit ACC. But ACC’s EBITDA per million tonne of cement sold is nearly 30% lower than Gujarat Ambuja, and over a long term, this gap will reduce as ACC uses Holcim’s expertise. ACC’s capacity of 18m tonnes is set to rise by 2.5m tonnes when modernisation and expansion at its plants are completed. Its efficiency levels are lower than those of Gujarat Ambuja, Madras Cement and Shree Cement. These companies have consistently notched up operating margins upwards of 20%, even in tough times for the industry, and 30% when the going is good.


FDI may bloom in farm retail, food processing

THE government is now planning to open up farm retail and food processing to foreign direct investment (FDI). The move is seen as part of a larger strategy to allow phased opening up of the retail sector to FDI.
Apart from FDI, farm retail and food processing are likely to get a lucrative deal during the Budget, said Union minister of state for food processing industries Subodh Kant Sahai.
“We have succeeded in getting 51% FDI in single brand retail. Now, we are pushing for FDI in farm retail as well,” the minister added.
According to ministry sources, the group of ministers (GoM) headed by agriculture minister Sharad Pawar has already worked out details of the taxation treatment, approach to FDI and the government policy for the farm retail and processing industries.
Opening up the sector for 51% FDI seems to be part of the package. The sector that has generated lot of interest and investment from some of the biggest corporate names in India — Reliance, Bharti-Rothschild, ITC, Hero and Tatas – is also likely to get some more attention in the coming session of Parliament.
The Budget might see the government putting all food processing activities in the ambit of ‘infrastructure building’ with similar sops, tax holidays and benefits as are given to projects that invest in roads, bridges etc.
“All food processing activity is likely to be declared as infrastructure activity. Similarly, we are already talking to the VAT panel that all perishables be put in the zero VAT category while other farm produce should not attract more than 4% of the value added tax,” the minister told ET here today.
The ministry for food processing industries is working on a contract farming law, which can work as a model for the states to help create taxation parity for the industry and provide adequate protection to the farmers.
“We also plan to link farming with industry,” he said, adding that the ministry was not only promoting contract farming, but there were also plans to introduce the longawaited Integrated Food Law (IFL) that provides a for unified regulatory authority for agriculture and farm produce.


Ranbaxy mixes bitter pill for Eli Lilly

IN ONE of the high-profile patent disputes, multinational drug maker Eli Lilly’s patent application for erectile dysfunction drug Cialis has been opposed by Ranbaxy at the pregrant opposition stage.
Eli Lilly is facing the patent challenge on Cialis even as it is fighting a legal battle against some of the domestic pharma majors, which have already launched generic copies of this drug.
Sources said that Ranbaxy has filed the pre-grant opposition against Eli Lilly’s Cialis recently. Some other Indian companies, which currently market the generic version of this drug, are also expected to file pre-grant patent opposition against Cialis, sources added. When contacted, a Ranbaxy spokesperson said the company would not like to comment on the issue.
Mumbai-based Ajanta Pharma was among the first companies to introduce a copy of Cialis in the estimated Rs 100-crore Indian erectile dysfunction market, which is growing at 32% a year.
The drug works within 30 minutes of dosing and enables the patient to have a spontaneous sexual act within 36 hours (and hence is also called the weekend pill) unlike sildenafil citrate, the active ingredient of Pfizer’s Viagra, which requires the patient to schedule the act within four hours of dosing, claims Eli Lilly.
Patent rules allow an interested party an opportunity before the controller to block the grant of a patent. This is in addition to the provision to oppose after the grant of patent and the constitutional right of any individual to approach courts against the patent controller’s decision. Earlier, Mumbai -based Cipla and Hyderabadbased Hetero Drugs had reportedly contested a patent application filed by Wockhardt for nadifloxacin — an anti-bacterial drug.


Marico acquires HLL’s Nihar for Rs 300 crore

PERSONAL care major Marico has acquired the hair oil brand Nihar from Hindustan Lever (HLL) for a consideration estimated to be between Rs 250 and Rs 300 crore. The acquisition is expected to help Marico strengthen its distribution in the eastern markets and garner a stronger presence in the perfumed coconut oil segment which offers higher profit margins.
It is also being seen as a pre-emptive move to prevent the brand from being acquired by its rivals, who could pose a threat to Marico’s leadership in the segment, sources said. Marico is currently the market leader with a share of 53-54% in the coconut hair oil segment. Ambit Corporate Finance acted as Marico’s advisors in this transaction.
ET was the first to get a whiff of the deal that Nihar was on the block last December. Nihar, through its brand Nihar Naturals (Jasmine and Rose), has an annual turnover of about Rs 120 crore, spread over two segments — coconut oil and perfumed hair oils — and a market share of around 8-9% in the coconut hair oil segment. The Nihar franchise will add a little over 10% to Marico’s current turnover, which stood at Rs 857 crore for the nine months ended December 31, ‘05. The company had posted a net profit of Rs 62.9 crore for the first nine months of the current financial year.
“The synergy arises because of the complementary nature of the presence of the Nihar franchise, in terms of both geographies and consumer segment. Nihar’s value to Marico lies in the fact that it will bolster Marico’s presence in the East as also in the perfumed hair oil segment,” said a senior Marico official.
HLL had initiated the divestment as a part of its brand rationalisation exercise. The process involved competitive bidding among select FMCG companies. The transaction envisages a transfer of the IPR and other rights associated with the brand in India and other parts of the world. HLL will continue to operate brands in the valueadded hair oil segment. Nihar’s strengths in the eastern markets, especially its distribution reach in West Bengal, Bihar and Jharkhand will provide Marico a platform for its other brands.

Nihar buy to boost Marico’s regional pull

MARICO has bought hair oil brand Nihar from HLL. In the coconut oil segment, Nihar’s regional strengths will complement Marico’s presence in this Rs 800-crore category, reports Our Mumbai Bureau.
Better supply chain efficiencies, larger scale of operations and high focus on coconut oils and hair oils will also enable Marico to drive cost advantages, industry sources said.
“We see significant scope for value creation leveraging Nihar’s equity. This will help us top up our healthy organic growth, as we move towards our target of reaching a Rs 2,000 crore turnover over the next three years,” Harsh Mariwala, chairman and managing director said.
MK Sharma, vice-chairman, HLL said: “This is in line with our portfolio rationalisation strategy, while at the same time, creating value for our shareholders.”


It’s not gas: RIL may have struck oil in KG basin

RELIANCE Industries (RIL) may have hit yet another jackpot in the Krishna Godavari basin, off the Andhra Pradesh coast. After striking the world’s largest gas find in the KG basin in ’02, the company is now set to make one of the biggest oil finds in this region, which has been known for its gas reserves.
RIL is believed to have struck a significant oil reserve in the KG basin, close to its other gas finds in the Dhirubhai series. RIL officials when contacted confirmed that they have struck oil, but added that they are still trying to understand and evaluate the nature of the reservoir.
The company is learnt to be carrying out initial testing and is expected to apprise the director-general of hydrocarbons (DGH) in the coming days. When contacted, DGH VK Sibal said: “We are yet to hear from them. We are called or informed only when the official assessment has to be done.” Analysts said it would be quite some time before a clear picture of the reserve estimates emerges.
Industry sources say the company is drilling more wells to estimate the size of the discovery, which is believed to be fairly substantial. RIL officials were unwilling to share details of the find, but in a presentation to financial analysts after the third-quarter results on January 10, senior executives revealed some information. They said the company has drilled a second exploratory well in KGIII6 and two development wells in KGD6. “This has increased our confidence on the reserves and upside potential on the block,” the presentation said.
Initial estimates of the oil find indicate that this could be a medium-sized oilfield. And this could be just the tip of the iceberg. RIL had recently announced a marginal oil find in the KG basin. Cairn’s discovery of oil in Barmer, Rajasthan, is one of the recent mid-sized oil discoveries in the country.
The development is significant for RIL, and comes as the company seeks to make rapid strides in becoming a major upstream producer. Oil recently began gushing out of its Yemen oilfields — its first overseas venture — with production starting at around 2,000 barrels of oil per day. It recently signed an agreement with Ecopetrol of Columbia for farm-in opportunities in that country. RIL is also believed to have decided to invest about $8bn in Saudi Arabia for a large refinery and petrochemicals complex.


Vijith Pujari
Tuesday, [January 31, 2006]
Market ends at new all-time high

The Sensex ended the day above the 9,900 level, a new all-time closing high as all-round buying propped it up to new heights.

Earlier, the Sensex opened with a positive gap of 43 points at 9892.23 on the back of Rs 719.10 crore inflow from FIIs on Friday.

The BSE Sensex ended the day to close of 9819.89 point, which is 70.86 (0.72%) higher than its previous close.

The NSE Nifty ended on a provisional close of 3001.10, also a new all- time closing high for the index. It added 26.50 points (0.89%) to its previous finish.

The Nifty had hit a new all-time high of 3005.10.

The Sensex marched higher to intra-day hit of 9939.55 as buying continued at higher levels.

The low for the day was at 9873.37.

The BSE Smallcap index ended lower by 0.61% while the BSE Midcap index lost 0.05% due to which market breadth was negative today.

The BSE PSU index firmed 0.75% while the BSE Bankex added 0.15%.

The BSE Capital Goods Index was the biggest gainer among sectoral indices, up 2.26%.

The BSE Metal Index gained 1.99% while the BSE Auto index added 1.11%.

The total turnover amounted to Rs 3,751 crore which is higher than yesterday’s turnover of Rs 3,617 crore.

The advance-decline ratio was negative, 907 shares advancing, 1,598 declining and 57 staying put.

Among the Sensex stocks, 19 traded higher while 11 slipped.

Bhel was the biggest gainer from the Sensex pack, up 6.41% to Rs 1,810 after hitting all-time high of Rs 1,815. Its net profit jumped 78% to Rs 423.19 crore from Rs 237.40 crore in Q3 December 2004. Net sales rose 42.8% to Rs 3,614.64 crore (Rs 2,529.67 crore).

Tata Motors added 3% to Rs 708 while Hindalco gained 3.4% to Rs 165.90.

Maruti Udyog added 1.1% to Rs 761.80 and Tata Power advanced 1.2% to Rs 470.55.

HPCL slipped 1.2% to Rs 307.50 after it reported poor quarterly results while Gujarat Ambuja Cements slipped 2% to Rs 88.60.

RIL was the turnover-topper on BSE, aggregating Rs 219.12 crore, followed by Suzlon Energy with Rs 169.30 crore and ICICI Bank with Rs 164.14 crore.

Side-counters Adlabs Films, Celebrity Fashions, valecha Engineering, Nilkamal Plastics, Jai Corp, Mc Leod Russel, Saha Petroleum and Fem Care Pharma surged.

Simplex Castings, Sirpur Paper, Polaris, Flat Product, Ennore Foundaries, Ferro Alloys, Ultramarine and Haldyn Glass among others.

Dishman Pharma added 2.9% to Rs 191.20 on a huge volume of 16.45 lakh shares, thanks to a block deal of 15 lakh shares that was executed at Rs 190 on BSE in early trade. Dishman Pharma's Q3 December 2005 consolidated net profit has jumped 93.3% to Rs 19.40 crore (Rs 10.03 crore). Consolidated sales declined 1.8% to Rs 61.94 crore (Rs 63.13 crore).

Suzlon Energy spurted 7.5% to Rs 1160 after it reported a 300% surge in net profit to Rs 161.94 crore for the third quarter ended December 31, 2005 as against Rs 37.28 crore in Q3FY05. Total income increased to Rs 881.84 crore in Q3 FY 06 from Rs 290.45 crore in Q3FY05. The company has an order book position of Rs 4,232 crore including Rs 1,613 crore of domestic orders and Rs 2,619 crore of export orders.

Mahindra & Mahindra (M&M) flared 4.5% higher to Rs 561 after its net profit jumped 75% to Rs 233.46 crore for the Q3 ended 31 December 2005 as compared to Rs 133.19 crore for the quarter ended 31 December 2004. Total Income increased 13.8% to Rs 2,247.45 crore (Rs 1794.52 crore).

Ennore Foundries slumped 8.13% to Rs 145.75 after the company reported a fall in net profit for Q3 December 2005. It reported a 13.6% fall in Q3 December 2005 net profit to Rs 3.11 crore, compared to Rs 3.60 crore in Q3 December 2004. Net sales has jumped 43.6% to Rs 81.13 crore from Rs 56.46 crore).

Opto Circuits (India) surged 7.8% to Rs 293.65 on the back of strong Q3 results. It reported 119.7% growth in Q3 December 2005 net profit to Rs 10.02 crore compared to Rs 4.56 crore in Q3 December 2004. Net sales has risen 68.4% to Rs 32.18 crore (Rs 19.11 crore).

Jindal Stainless plunged 4.8% to Rs 90.30 after it reported a sharp fall in Q3 December 2005 net profit. Its net profit dived 68% to Rs 20.94 crore in Q3 December 2005 from Rs 66.38 crore in Q3 December 2004. Net sales has declined 15.9% to Rs 707.36 crore from Rs 841.17 crore.

Zee Telefilms was back in focus today after a long time as it jumped 3.9% to Rs 164.80 on reports that has overtaken Sony Entertainment Television for number 2 slot in Hindi entertainment segment. 8.62 lakh shares changed hands on the counter today.

Polaris slumped 9.22% to Rs 118.10 after it reported a Q3 December 2005 (QoQ) net loss of Rs 5.7 crore (net profit of Rs 13.26 crore). (QoQ) net revenues were down 4.8% to Rs 203.28 crore (Rs 213.55 crore).

Scandent Solutions added 1.5% to Rs 198.50 after its board approved Rs 135 crore preferential issue of convertible bonds at Rs 217 to Merrill Lynch.

United Western Bank jumped 5% to Rs 45.95 after reports that it will go for preferential issue and/or GDR issue.

Jindal Saw flared 5.5% to Rs 417 after its Q1 December 2005 net profit jumped 62.6% to Rs 31.77 crore (Rs 19.53 crore). Net sales jumped 73.7% to Rs 819.79 crore (Rs 471.92 crore).

NTPC added 2.15% to Rs 115.25 after its Q3 December 2005, net Profit increased 30.5% to Rs 1,781.7 crore (Rs 1,365.5 crore). Net sales rose 21% to Rs 6,868.9 crore (Rs 5,698.2 crore).

JP Hydropower slumped 2.2% to Rs 32 after it reported a Q3 December 2005 (QoQ) net loss of Rs 1.35 crore (profit of Rs 45.1 crore). (QoQ) Net sales fell to Rs 57 crore (Rs 108.2 crore).

TVS Motor spurted 6.5% to Rs 117.50 after its Q3 December 2005, net profit increased to Rs 31 crore (Rs 28.2 crore). Net sales rose to Rs 87.1 crore (Rs 80.4 crore).

KRBL added 2.3% to Rs 154.10 after its Q3 Decemeber 2005 net profit surged to Rs 10.5 crore (Rs 5.97 crore). Net sales rose to Rs 214.8 crore (Rs 104.9 crore).

Bharati Shipyard flared 5.5% to Rs 374.80 after its Q3 December 2005 net sales jumped 92% to Rs 75.38 crore (Rs 39.30 crore). Net profit surged 122% to Rs 10.30 crore (Rs 4.63 crore)

Source:- www.capitalmarket.com


Vijith Pujari
Tata Motors in top gear

Tata Motors jumped 3.1% to a lifetime closing high of Rs 709.30 on sustained buying.

As many as 8.2 lakh shares changed hands in the counter on BSE.

The stock has surged since mid-January 2006. From a recent low of Rs 617.45 on 18 January, it has gained 14.8% in just 8 trading sessions to current Rs 709.30.

The flare up in the stock price has materialised even as the global oil prices have surged. US crude oil for March delivery rose 59 cents to settle at $68.35 a barrel on the New York Mercantile Exchange on Monday (30 January), bringing prices within reach of the $70.85 peak hit in late August. High oil prices often weigh on auto stocks on concerns that an increase in fuel prices may impact sales.

The stock has been on the up since June 2005. From a low of Rs 414.15 on 20 June 2005, it has gained a staggering 71.2%.

Analysts remain upbeat on the Tata Motors stocks given the overall buoyant economic scenario. With a bountiful monsoon in 2005 and reservoir levels at 10-year highs, prospects appear bright indeed for the agricultural sector. This, along with the hardening trend in freight rates, augurs well for commercial vehicle sales.

The upward revision in commercial vehicle prices between 2-2.5% in December 2005 would help Tata Motors recover higher input costs.

The strong response to its sub-1 tonne Ace launched in May last has compensated for the drop in sales of heavy commercial vehicles. Tata Motors has already started work on doubling its capacity for the Ace to 60,000 units by the end of this calendar year. Tata Motors' sales of heavy commercial vehicles fell 8% in the April-December 2005 period.

Recently, Tata Motors launched a new version of its small car. Christened Indica V2 XETA, the petrol-powered car with a 1.4-litre engine is said to deliver a mileage of 14 kmpl under standard test conditions.

A significant feature of Tata Motors' business in the last two years has been its increasing international profile. Daewoo's commercial vehicles plant in Korea and Hispano Carrocera's bus business in Spain have been assimilated well into Tata Motors. The company has also been successful in the South African market for commercial vehicles as also in Turkey and West Asia. The growing share of international business would act as a buffer protecting the company from business cycles in the domestic market.

Tata Motors is announcing its Q3 December 2005 results on 9 February 2006.


Vijith Pujari
TCS plans new facility in Gujarat

Tata Consultancy Services Ltd (TCS) has announced plans to develop a new facility at Infocity, Gandhinagar, in the state of Gujarat spread over 35 acres in three phases. The first phase of global software development centre is expected to house 2000 seats once fully commissioned.

The new facility will augment the presence of the Company in the state of Gujarat, where the company is already working with the government as well as other public-sector firms and dairy cooperatives. The company has already recruited over 480 employees in the state during the current financial year.

The Gandhinagar facility will cater to the needs of the government and utility sector clients of the Company as well as focus on ERP projects being executed by the company for the global clients. The facility will be completely operational in 18 months.

At the Bhoomi Poojan ceremony, which was performed by the Honourable Chief Minister of Gujarat, Shri Narendra Modi, the Companys CEO & Managing Director, S Ramadorai said, the companys experience suggests that efforts to develop TCS Infrastructure at various locations has resulted in overall development of the region. TCS plans to play an integral role in the further development of the Gujarat economy by working with corporations and helping train and develop the talent in the state.

The mega facility at Gandhinagar, will add to a number of large, aesthetically designed facilities developed by the Company across the country including Mumbai, Delhi, Chennai, Hyderabad and Thiruvanathapuram.

Source:- www.indiabulls.com


Announcement of Interim Dividend

Fedders Lloyd announces 7% interim dividend for FY 06

Fedders Lloyd Corporation Ltd has informed that the Board of Directors of the Company at the meeting held on January 30, 2006, inter alia, have declared an Interim Dividend at 7% of the paid up Equity Share Capital of the Company for the Financial Year 2005-06.

Kirloskar Brothers announces 100% interim dividend

Kirloskar Brothers Ltd has informed that the Board of Directors of the Company at the meeting held on January 31, 2006, inter alia, have declared an interim dividend of Rs 2/- per share (100%) on equity shares of Rs 2/- each for the financial year 2005-06.

Glenmark Pharma announces 35% interim dividend

Glenmark Pharmaceuticals Ltd has informed that the Board of Directors of the Company at the meeting held on January 31, 2006, inter alia, have declared interim dividend at 35% on the Equity Share Capital of the Company for the financial year ended 2005-06.

Source:- www.indiabulls.com


Q3 -Results

Jindal Stainless declares unaudited results for Q3

Jindal Stainless Ltd has announced the following unaudited results for the quarter ended December 31, 2005:

The Company has posted a net profit after tax of Rs 209.40 million for the quarter ended December 31, 2005 (Q3 FY 05-06) as compared to Rs 663.80 million for the quarter ended December 31, 2004 (Q3 FY 04-05). Total Income (net of excise) has decreased from Rs 8528.30 million in Q3 FY 04-05 to Rs 7116.30 million for Q3 FY 05-06.

Neyveli Lignite Q3 net down to Rs 1370 mn

Neyveli Lignite Corporation Ltd has announced the following unaudited results for the quarter ended December 31, 2005:

The Company has posted a net profit of Rs 1370 million for the quarter ended December 31, 2005 (Q3 FY 05-06) as compared to Rs 2370 million for the quarter ended December 31, 2004 (Q3 FY 04-05). Total Income has decreased from Rs 7760 million in Q3 FY 04-05 to Rs 6880 million for Q3 FY 05-06.



Q3 Results

Mahindra & Mahindra Q3 net zooms to Rs 2334.577 mn

Mahindra & Mahindra Ltd has announced the following unaudited results for the quarter ended December 31, 2005:

The Company has posted a profit after tax of Rs 2334.577 million for the quarter ended December 31, 2005 (Q3 FY 05-06) as compared to Rs 1331.866 million for the quarter ended December 31, 2004 (Q3 FY 04-05). Total Income (net of excise) has increased from Rs 17945.185 million in Q3 FY 04-05 to Rs 22474.566 million for Q3 FY 05-06.

Aurobindo Pharma clocks Rs 261.90 mn net profit in Q3

Aurobindo Pharma Ltd has announced the following unaudited results for the quarter ended December 31, 2005:

The Company has posted a net profit of Rs 261.90 million for the quarter ended December 31, 2005 (Q3 FY 05-06) as compared to Rs 105.90 million for the quarter ended December 31, 2004 (Q3 FY 04-05). Total Income has increased from Rs 3233.40 million in Q3 FY 04-05 to Rs 4169.70 million for Q3 FY 05-06.

Asian Paints Q3 net at Rs 609.59 mn

Asian Paints Ltd has announced the following results for the quarter ended December 31, 2005:

The Audited results for the quarter ended December 31, 2005

The Company has posted a profit after prior period items of Rs 609.59 million for the quarter ended December 31, 2005 (Q3 FY 05-06) as compared to Rs 501.07 million for the quarter ended December 31, 2004 (Q3 FY 04-05). Total Income (net of discounts & excise duty) has increased from Rs 5885.21 million in Q3 FY 04-05 to Rs 6489.11 million for Q3 FY 05-06.

The Unaudited Consolidated results are as follows:

The Group has posted a profit attributable to shareholders of Rs 626.32 million for the quarter ended December 31, 2005 (Q3 FY 05-06) where as the same was at Rs 560.27 million for the quarter ended December 31, 2004 (Q3 FY 04-05). Total Income (net of discounts & excise duty) is to Rs 8261.62 million for Q3 FY 05-06 where as the same was at Rs 7483.73 million in Q3 FY 04-05.

Cummins India clocks Rs 484.734 mn net profit in Q3

Cummins India Ltd has announced the following unaudited results for the quarter ended December 31, 2005:

The Company has posted a net profit of Rs 484.734 million for the quarter ended December 31, 2005 (Q3 FY 05-06) as compared to Rs 328.564 million for the quarter ended December 31, 2004 (Q3 FY 04-05). Total Income has increased from Rs 3240.107 million in Q3 FY 04-05 to Rs 4095.750 million for Q3 FY 05-06.

The Board of Directors have declared an interim dividend of 100% i.e. Rs 2/- per share on equity shares of Rs 2/- each, for the financial year 2005-2006. March 03, 2006 has been fixed as Record Date for the purpose of payment of interim dividend.


GVK Power & Infrastructure Ltd. Issue Open on 2 Feb

Issue Open 02/02/2006
Issue Close 07/02/2006
Issue Size 8275556
Issue Type Book Building
Face Value Rs.10/-
Price Range Rs.260/- to Rs.310/-
Tick Size Re.1/-
Market Lot 20
Minimum Order Qty 20
Listing Stock Exchange NSE, Mumbai

GVK Power & Infrastructure (GVKPIL) is the holding company of the power businesses of GVK and also provides operations and maintenance services to its power assets. G V Krishna Reddy controlled GVK is a diversified business group with interests in power, roads, urban infrastructure, bioscience, hotels and manufacturing. The group has identified power and infrastructure as focus areas.

GVKPIL presently owns a 53.96% stake in GVK Industries (GIL), which has two power plants: (i) the operational 216-MW Jegurupadu Phase I, and (ii) the 220-MW Jegurupadu Phase II project, to be commissioned by mid February 2006.

In addition, GVKPIL currently owns a 47.47% equity stake in Gautami Power (GPL), which is developing a 464-MW combined cycle power plant that is expected to be commissioned by September 2006. GVKPIL will increase its ownership in GPL to 51% by subscribing to the equity of GPL. Once all the three plants become operational, the total capacity of the three plants will be 900 MW. All the three plants are independent power plants (IPP) and supply, or will supply, their output to Andhra Pradesh power distribution companies (APDISCOMs) under their respective long-term power purchase agreements

GVKPIL proposes to utilise the funds raised through this issue to contribute part of the equity required by GPL to establish a 464-MW duel fuel combined cycle plant located in Andhra Pradesh and repay the bridge finance availed for funding the equity of GPL. The equity investment in GPL is estimated at Rs. 95.3 crore and the repayment of loan is estimated at Rs 60 crore.

The initial public offer (IPO) is of 8,275,556 equity shares of Rs 10 each through 100% book-building process. The price band has been fixed at Rs 260 to Rs 310 per equity share of Rs 10 each. The issue opens on 2 February and closes on 7 February 2006. It will constitute 35% of the fully diluted post-issue paid-up capital of the GVKPIL.


Each of GVKPIL’s generation facilities has an assured source of revenue under a take- or- pay power purchase agreement(PPA) with APDISCOMs. The power distribution companies are required to pay for the plant's output at an agreed plant load factor (PLF), regardless of whether or not APDISCOMs actually takes delivery of the power generated. APDISCOMs’ payment obligations to GVKPIL, as per PPAs, are secured by letters of credit, escrow arrangement and the state government’s guarantee covering all of APDISCOMs’ payment obligations. According to GVKPIL’s management APDISCOMs has never defaulted on their monthly payment obligations even by a signal day.
It is expected that GVKPIL will benefit from economies of scale through the use of shared facilities between Jegurupadu Phase I and Jegurupadu Phase II. These shared facilities include using the approach roads to the projects, sharing the use of the demineralised plant capacity, raw water storage reservoir and potable water, staff quarters, and the administrative building and the compound walls.


Currently there is shortage in the availability of gas in Andhra Pradesh. The shortage is likely to persist at least in FY 2007. As a result, operations of the existing Jegurupadu phase I as well as proposed phase II and GPL will be adversely affected.


The FY 2005 EPS of GVKPIL (standalone) stands at Rs 0.7 on post-issue equity. The company’s net profit in the first half of FY 2006 has been inflated by Rs 2 crore by the one-time technical services fees received from subsidiary and interim dividend of Rs 5 crore received form the subsidiary. Thus, the net profit of Rs 4.23 crore in the first half of FY 2006 cannot be annualised. Here it will be more appropriate to consider the consolidated results, which shows a net profit of only Rs 48 lakh. On annualising it, the consolidated EPS is just Rs 0.4. Th offer price band is Rs 260-310. Naturally, the price band factors in the company’s expected full earnings from the two proposed new power projects. However, considering the state of natural gas availability, these projects are likely to fully reflect earning only from FY 2008.




Dividend payout buzz lights up Gail

PSU major Gas Authority of India’s (Gail) counter was on fire. The stock gained over 3% on a day when the broad market was quite weak. There is talk that the company may make a large dividend payout. Also, selling by a leading foreign fund, which had a huge stake in the company, is said to be completed. Gail rose 3.3% to Rs 285.9. Over 2.6 lakh shares were traded on the Bombay Stock Exchange.

Wipro rises on GM order news

LARGE buying was seen in IT major Wipro. The buzz is that the company is receiving a large order from US automaker General Motors. Some foreign funds are said to be active in the counter. Wipro rose 3.2% to Rs 521.9. Over 4.5 lakh shares were traded on the BSE.

Budget expectations lift pharma scrips

MOST of the pharma stocks saw good buying interest. There is speculation that the government may provide some concessions to pharma companies in the coming budget. Dr Reddy’s was a big gainer with the stock rising by 5.3% to Rs 1,130.5. The other pharma scrip that saw heightened action was Ranbaxy, which rose 1.6% to Rs 399.1.



Govt looks to open up corp debt market

THE government on Monday unveiled a large menu to whet retail investors’ appetite for the dormant domestic corporate debt market and make it easy for FIIs to invest in infrastructure debt.
The plan includes giving the same preferential tax treatment for papers at par with government securities, a uniform stamp duty, permitting repo in corporate papers and listing of securitised debt. The recommendations have been made by a highlevel government committee chaired by RH Patil, chairman of UTI-AMC. The committee was set up to stop the dwindling interest of small investors in debt papers, even as the equities market shot up.
The prescriptions put up on the finance ministry website are likely to figure in the forthcoming Budget. The government has also received the Lahiri Committee report on the role of FIIs, which has suggested keeping the FII investment limit in a sector over and above the FDI cap, and permitting a five-year time frame to wind up unregulated participatory notes.
To broaden the market for infrastructure debt funds, Mr Patil has said foreign players should be allowed to invest in them. The rationale was that if corporates could raise ECBs abroad for infrastructure, there was no reason to deny those foreign funds to do so directly in India. “Debt FIIs should be allowed to invest without any upper limit in rupee-denominated infrastructure debt funds registered with the Sebi, along the same lines as that suggested for domestic qualified institutional buyers,” the report says. To develop a primary market for debt, the committee has suggested that the Centre should address the issue of differential stamp duties levied by state governments. This includes making uniform the rates on housing mortgage (partly-secured registered mortgages) and unsecured debentures. The rates should be linked with the tenor of the securities. Also, the government should bring in amendments to make corporate bonds exempt from tax deduction at source.
There should also be ‘stringent disclosure requirements’ for bonds’ public issue at par with those for equities to raise the confidence level of retail investors and Sebi should encourage development of professional trustee firms. “This would remove the information asymmetry faced by small investors vis-àvis the issuers and defaults by firms in servicing debts would become widely known,” said UK Sinha, CEO, UTI-AMC and a panel member. The panel has suggested that Sebi-registered debt funds should receive the same tax treatment as VC funds and specifically ‘pass-through the benefits.’ To resolve uncertainty in taxation issues regarding securitised papers, the Centre should modify MF norms to permit wholesale investors to invest in units of closed-ended schemes. The minimum market lot criteria of Rs 10 lakh for trading in corporate bonds on the stock exchanges should be reduced to Rs 1 lakh to enable better access to small investors.
To encourage bank participation in proposed debt funds, the panel has said investment in debt funds should not be subject to capital market exposure limits set by RBI for banks. It has also asked for allowing repo operations in corporate bonds. NBFCs with a corpus of at least Rs 50 crore should be allowed to invest in security receipts of ARCs.



Apollo to buy Dunlop Int’l for Rs 290 crore

THE board of directors of Apollo Tyres on Monday approved the acquisition of the $200m Dunlop Tyres International (Dunlop South Africa) in an all cash deal for 100% equity worth around Rs 290 crore.
The transaction is subject to regulatory approvals in both countries, including that of the South African Competition Commission, and certain contractual conditions precedent to the closing of the transaction, according to the statement released by the company.
Company officials have been authorised to conclude agreements with the shareholders of the Durban, South Africa-headquartered company which also owns subsidiaries in Zimbabwe and the United Kingdom. Speaking on the acquisition Onkar S Kanwar, chairman & managing director, Apollo Tyres, said: “We have been in close contact with the Dunlop management for some time and have been impressed with their range of products. This acquisition opens up new avenues for us. We will add value to Dunlop South Africa, and the combined entity will become an even stronger force to reckon with in the coming years,” he said. Through the acquisition, Apollo will also gain a substantial shareholding in National Tyre Services (NTS), Zimbabwe — a major tyre distributor and retreading company. NTS has a technology tie-up with Bandag, the worldwide leader in the field of retreading technology.
Mr Kanwar added that the “the synergies between our two companies will add enormous value. Post this acquisition, Dunlop’s know-how will further boost Apollo’s R&D and market reach, enabling us to maintain our technology-driven product and market leadership in all the key segments of the tyre market and open up further global opportunities.” The current management will continue to run the operations at Dunlop Tyres International with appropriate support from Apollo personnel, in accordance to an agreed integration plan jointly. The financial and legal advisors to Apollo Tyres for this transaction were JM Morgan Stanley and Amarchand & Mangaldas, respectively.
Apollo is the first Indian tyre company to undertake an acquisition abroad. This acquisition is Apollo’s first foray in the global arena and is expected to be the springboard to position Apollo Tyres as a global player, and a base for future growth initiatives.
Dunlop Tyres International’s three manufacturing units in South Africa and Zimbabwe producing the entire range of bias and radial products — from high-end truck and bus tyres to industrial, farm, light truck, off-road and mining tyres, high-speed passenger car radials and ultra high performance car tyres. Apart from tyres made under the worldrenowned Dunlop brand, it is also the manufacturer of high-value brands like Regal and India; has exports to Europe, Central Asia, Australia and South America and has contract manufacturing with key international players.
Apollo officials are believed to have visited the country late last year to hammer out the deal with Dunlop Zimbabwe and contracted a Harare law firm, Scanlen & Holderness, to oversee a due diligence check. Scanlen & Holderness, in turn signed up Bulawayo-based legal practitioners Webb, Low and Barry to conduct the exercise on their behalf. The due diligence exercise was completed mid-December, sources said.



Jaypee acquires UP Cement’s assets with Rs 459-crore bid

THE cement industry seems to be in a consolidation mode. The day Holcim announced the acquisition of 14.8% stake in Gujarat Ambuja, domestic cement major Jaypee Associates snapped up the assets of UP State Cement Corporation in a hotly-contested bid. The acquisition of the 2-mt capacity will cost the Gaurs Rs 459 crore.
Besides the Jaypee group, Lafarge and Dalmia Cement also participated in the financial bid, which opened on Monday. Dalmia Cement is learnt to have quoted a price of Rs 376 crore. Sources said the Aditya Birla group company Grasim, which was also in the race, had decided against participating at the last minute.
When contacted, Jaypee Associates MD Manoj Gaur confirmed to ET the acquisition deal. He, however, refused to divulge the details.
The UP State Cement Corporation, currently a sick company, has three plants located at Dala, Chunar and Churk in Mirzapur district. The reserve price for the financial bids was set at Rs 271 crore. The acquisition will make the Jaypee group the first company to have manufacturing facility in the state. The company currently has about 20% market share in UP.
Besides, the acquisition will also help the group to increase its total cement production capacity to 9mt from the existing 7mt. The group has another 3-mt production capacity under implementation.
The Jaypee group will have to pump in a significant amount of funds to restart the operations of UP State Cement Corporation’s plants, which have been lying idle for several years now. The sale of the company, which had been under liquidation, was conducted by an asset sale committee set up under a court order.


Dell Reloaded: Co plans unit here

DELL, one of world’s leading computer makers, has so far failed to excite the Indian market. Not many customers buy online, the way it sells globally. And who wants to wait over three weeks, after placing the order for a PC, to see it on their desks. At least not from a company that prides itself on keeping just four days inventory and shipping the products fast.
Dell today announced plans to set-up a manufacturing base in India. The plan is currently at a conceptual stage and the company plans to hold negotiations with the central and various state government before giving a final go-ahead to its manufacturing facility in India.
No wonder, Dell is trying hard to change the way it looks at the Indian market. In fact, after unsuccessfully trying to sell PCs here, Dell has plans to make them here. When that happens, it will be Dell’s 10th manufacturing facility in the world, seventh outside the US.
At present, Dell meets the demand for the local market by shipping computers from its manufacturing facility in Penang, Malaysia. The company’s market share in India is less than 4%, far behind leaders HCL, HP and Lenovo (earlier IBM). Interestingly, in terms of manpower, India is already Dell’s largest base outside the US with over 10,000 staff in its captive BPO unit.
The decision to set up a manufacturing facility comes in the wake of growing PC sales in India. High costs of shipping the machines from Malaysia and the long time taken — at least three to four weeks — it takes to fulfil customer orders here make Dell less attractive for buyers in India. Also its global model — online booking — has found few takers in India. A manufacturing facility in India will help the computer maker tap one of the fastest growing markets in the Asia-Pacific region.
Vinnie Mehta, executive director of MAIT, says, “The opportunity in India is huge. The PC market is growing at 25-30% a year. In ’04-05, 3.6m PCs were sold in India, and we are likely to close ’05-06 at 4.5m PC sales.” The notebook market, on the other hand, is growing at almost 100%.
Dell’s president and CEO Kevin Rollins expects 10m PCs to be sold in India in the next 3-4 years. “It’s the right time to start manufacturing here,” says Mr Rollins. When asked about Dell’s plans to set up a plant an analyst told ET, “When Dell started selling in India, it hoped to ship machines to customers within a week. That did not happen due to logistics and customs clearance bottlenecks. Being here will bring it closer to the customer. Also, competitors like Lenovo, HP, Acer, HCL already have an assembly or a manufacturing facility here. By not being here, it is losing out share in a fast growing market.”
Interestingly, apart from the manufacturing facility, Dell is ramping up presence in India. It plans to set up another BPO facility in Gurgaon (its fourth in India after Bangalore, Hyderabad and Mohali). Besides, it plans to add 700 to 1,000 staff in Gurgaon in a year and have about 15,000 staff in India in a few years. This will perhaps make Dell the largest captive BPO operation in India. Prior to this, GE’s captive operation was the largest till it sold out to two global equity partners.



FIIs raise GACL & ACC stakes in Dec quarter

AS the buzz about the Sekhsarias selling out to the Swiss major Holcim was doing the rounds, foreign funds were aggressively buying into both Gujarat Ambuja Cements and ACC.
In the December quarter, foreign institutional investors (FIIs) have increased their stake in Gujarat Ambuja by 4.1% to 34.39%. In the case of ACC, foreign funds have jacked up their stake by 3.22% to 23.74% in the past three months.
In Gujarat Ambuja, the FII holding has increased after private equity investor Warburg Pincus sold its stake in the company. On December 16, Warbug Pincus had offloaded a 5.7% stake in Gujarat Ambuja Cements to two FIIs, Capital International and T Rowe Price. The stake sale by Warbug Pincus came when there was speculation in the market that Holcim is taking over Gujarat Ambuja Cement. The GACL stock had risen quite substantially as the market got wind of the development. The stock has risen by over 30% in the past 3 months as there was intense speculation that there could be a change in management in Gujarat Ambuja Cement.
Some of the large foreign funds that have over 1% holding in the cement major including Genesis, Janus, CALPERS, JP Morgan and Capital International. Deutsche Bank group has over 6% in the cement company.
Even ACC, now controlled by Holcim, saw large foreign fund activities during the past quarter. As of September end, FII holding in ACC was 20.52%, which now gone up to 20.5% as on December 31. Some of the FIIs that have large holding in ACC include the HSBC group, JP Morgan and New World Fund Inc.


Sunil Hitech Engineers Ltd.Issue Open on30th Jan.

Issue Open 30/01/2006
Issue Close 03/02/2006
Issue Size 3475000
Issue Type Fixed Price
Face Value Rs.10/-
Price Range Rs.100/-
Tick Size
Market Lot 50
Minimum Order Qty 50
Listing Stock Exchange Mumbai, NSE

Background :

Sunil Hitech Engineers Ltd. (SHEL) was incorporated in the year 1998 as a private limited company. It becomes a public limited company in the year 2005.
The company engaged in the niche segment of Fabrication, Erection & Testing and Commissioning of Bunkers, ESPs, Boilers, TG sets in the Power Plants, both in Private & Public sector. SHEL is amongst very few companies, which are tightly focused, in the ever-growing Power Sector.
SHEL has to its credit many projects executed varying from 30 MW Parli TPS to 500 MW like Korba STPS (Super Thermal Power Station), Chandrapur STPS, Vindhachal STPS, Talcher STPP (Super Thermal Power Plant), Rihandh STPP and also 250 MW Suratgarh, 210 MW Khaperkheda.
Cliental of the company includes National Thermal Power Corporation, Reliance Energy Ltd., Hindalco Industries Ltd, Bharat Heavy Electricals Ltd, Sterlite Industries, Balco apart from a number of state electricity boards.

Object of the Issue :

To meet the Incremental Long Term working capital requirement.
To acquire capital assets for carrying on the existing business.
To partly repay the existing term loan.
To meet the expenses of the issue.
Strengths :
Unexecuted order of the company stood at Rs.178 crore as on 31st November 2005, reflects earning visibility, which is almost two-and-half times of its 2005 revenue. SHEL's healthy order book should offer prospects for growth.
Total Income of the company has increased at a CAGR of 44.14% between FY2001- FY2005. During the same period PAT has increased at a CAGR of 70%.
The company owns the equipment used in operations. This strategy offers potential for margin protection as operations scale up. Operating margins of 8-9 per cent are marginally higher than its peers.
The Indian economy is poised for high growth in the years to come. The economic boom reflects development of industrial and allied sectors, thereby spurring a higher demand for power. Players like Sunil Hitech expects expansion of business opportunities as substantial ramp-up in power capacity is expected both in private and public sector over the next few years.
One of the objects of the issue is part-repayment of loan. This will reduce the interest burden of the company that was Rs.146 lakhs in FY2005.

Weakness :

Sundry debtor at Rs.2300 lakhs as on 30th Sept 2005 is close to 40% of the total assets of the company. Increasing receivables can lead to pressure in working capital management.
The company has to compete with reputed companies like L&T, Simplex Concrete Piles, and Tata Projects, which have more resources than SHEL.
The contracts are awarded through competitive bidding process. In order to acquire the contract and to maintain the market share, companies are compelled to bid at lower price. This competition puts pressure on margin of the company as well as affects its prospects.
The Engineering -Turnkey services construction industry is highly fragmented, wherein large number of players are operating in unorganized sector.

Valuations :

PAT of the company has increased by over 170% from Rs.83 lakhs in FY2004 to Rs.224 lakhs in FY2005.Continuing the trend; the company has recorded a PAT of Rs.229 lakhs in H1 of FY2006.
Total Income of the company has increased by 92% from Rs.3,583 lakhs in FY2004 to Rs.6,884 lakhs in FY2005. In H1 of FY total income stood at Rs.5,943.35 lakhs.
Return on Net-worth of the company at the end of FY2005 stood at 19.86%. NAV per share Was Rs.16.79.
Post Issue EPS works out to be Rs.4.58 based of annualized profit of H1FY2005. The shares are offered at Rs.100, at a P/E multiple of 21.86.


Last edited:


Vijith Pujari
Thursday, February 01 + February 02, 2006


Nalco shines on divestment news

STRONG fund buying in metals and low inventories have boosted aluminium companies, including state-run Nalco. The shares extended their gains on reports that the government plans to sell 5% of its stake in the open market. Nalco rose 7.5% to Rs 305, while 9,13,933 shares were traded on the BSE.

Sirpur Paper Mills soars

PAPER maker Sirpur rose 20% to Rs 42.9 on reports that paper prices will rise sharply due to strong growth in demand. While volumes stood at 710 shares on the BSE, traders expect that buying in the stock will rise in the future.

Prism Cements rises on deal buzz

WHILE cement stocks have been up due to an industry-wise rise in January sales, the recent deal by Swiss major Holcim to buy 14.8% in Gujarat Ambuja has fuelled speculation of similar transactions in other cement companies. The Prism Cements stock, too, climbed 8.5% to Rs 22.2, with volumes at 1.25m shares on the BSE.



DCB plans to raise Rs 345cr through IPO, pref allotment

DEVELOPMENT Credit Bank (DCB) plans to raise Rs 345 crore of fresh equity capital through the combination of an IPO and preferential allotment. DCB CEO Gautam Vir told ET that the bank plans to raise Rs 250 crore through an IPO and Rs 95 crore by selling equity to a group of investors.
“We are hoping to launch the IPO after the Union Budget (in March),” he said. JM Financial and Enam Consultants have been appointed lead managers to the IPO. The bank has submitted a list of investors to the RBI for approval. The bank plans to place 22-25% with financial investors through the private placement.
At present, Aga Khan Fund for Economic Development (AKFED) owns 69% in DCB. AKFED’s holding will come down to around 33-35% after the IPO. As per the RBI guidelines on ownership in private sector ba-nks, a single entity cannot own more than 5% in a private bank. An investor’s holding can go up to 10% only with the RBI’s approval.
A significant part of the new capital will be utilised to writeoff bad loans. The bank currently has gross non-performing assets (NPAs) of 12.5% and net NPAs of 6.7%. It has a paid-up equity capital of Rs 66 crore.
In ’04, the bank had tried to sell a 12.9% equity to ChrysCapital. The deal was not cleared by RBI, after the authorities in Mauritius (where ChrysCapital was based) put an “adverse notice on ChrysCapital”.
DCB had reported a net loss of Rs 163 crore for FY05. The bank’s previous CEO HV Sheshadri resigned in March, after the RBI did not give him an extension. The bank appointed former MD of Infrastructure Development Finance Co Nasser Munjee as chairman. Mr Vir, an ex-Citibanker, who was earlier the CEO of Hebros Bank (Bulgaria), joined DCB as MD in September.



Zip drive: Wipro bags 5-year, $300-m GM deal

THE much-awaited announcement from the world’s largest car maker, General Motors (GM), on the award of its $15bn, IT outsourcing deal, is finally out. Wipro, the only Indian company to make the final short-list, has bagged an order worth $300m spread over a period of five years.
Wipro will be the only Tier 1 offshore service provider to GM. This is the second largest deal to be won by an Indian IT services firm, just short of the one bagged by HCL Technologies ($335m) recently. The others who have got large chunks of the GM deal are EDS, IBM, HP, Capgemini and Compuware Covisint. Of the 43 request for proposals (RFP) put forth by GM, four were bagged by Wipro Technologies. However, Wipro has bagged one project independently while the the other three are in partnership with EDS, the largest winner in the GM contract. EDS, in fact, was the incumbent in this deal.
Sudip Banerjee, president, enterprise solutions, Wipro Technologies, said that this contract has elevated Wipro to Tier 1 global systems integrator partner for GM over the next five years and puts it in a good position to win future business with the auto giant. GM has been a long time partner with Wipro and has generated over $30m revenues in the last four quarters for the company. The pricing of the contract has been in line with average pricing of Wipro and there will not be any dilution in the margins, Mr Banerjee said. The project is in the area of middleware system, while details of the other three projects are yet to be worked out with EDS. GM will spend about $15bn over the next five years.



‘Mukesh wants 20,000 acres for biotech project near Kolkata’

BARELY three months ahead of the assembly elections, West Bengal chief minister Buddhadeb Bhattacharjee dropped a bombshell on Thursday when he announced that Reliance Industries chairman Mukesh Ambani wants a staggering 20,000 acres of land near Kolkata to invest in a mega biotech venture.
Mr Bhattacharjee declined to spell out the proposed Reliance biotech project details, but top state circles close to developments at Reliance said the senior Ambani-controlled RIL was considering development of a sprawling special economic zone (SEZ) in the state where the proposed biotech project will be located. Subsequently, the project may involve the creation of a fullfledged industrial township to spur economic activity in the region.
“Mukesh Ambani has asked me for 20,000 acres of land for a large biotech project in the state,” Mr Bhattacharjee announced in the course of Ficci’s national executive committee meeting on Thursday. The request for a humongous 20,000 acres of land by Reliance is being attributed to the fact that any grandiose biotech project automatically entails the creation of a large botanical garden along with multiple marine laboratories and R&D facilities. Reliance Industries is officially silent on the issue. It is learnt, however, that the proposed biotech project may either be executed by the RIL-controlled Reliance Life Sciences or through a separate subsidiary that may be shortly floated to execute mega biotech ventures.
The latest developments come in the backdrop of RIL’s massive foray into real estate through the setting up of bustling special economic zones (SEZs). The company reportedly proposes to develop world-class townships close to existing metros that will eventually become buzzing zones of economic development over time. State circles are unwilling to comment on the possible investment levels that the Reliance biotech project will entail.
Incidentally, the state CM also indicated that Anil Ambani was scheduled to meet him on February 15 to discuss upcoming projects of the ADAE-controlled Reliance Infocomm in the state.
Not too long ago, the CM had voiced concern over the delay in execution of the much hyped Dhirubhai Ambani Institute of Information & Communication Technology (DAIICT) deemed university venture for which the state government has already offered 50 acres at Kalyani to DAIICT Society.
The project will be along the lines of the existing DAIICT university project in Gandhinagar. Besides the heavyweight Reliance announcements, Mr Bhattacharjee also indicated that the Tatas and Hindujas were close to finalising automotive ventures in the state. “Tatas have finally decided to set up an automotive project in Bengal. Things are also in the final stage for the auto project of the Hindujas,” he said.



Anil misses flight, drives to court over airport bid

THE government’s airport modernisation programme ran into trouble today with Reliance Airport Developers, an Anil Ambani Group company, filing a petition in the Delhi High Court against the selection of GMR-Fraport and GVK-South African Airports as partners for the Delhi and Mumbai airports, respectively. Reliance Airport had, in collaboration with ASA of Mexico, bid for both airports.
The methodology adopted in the selection of private sector partners for modernising the two airports was in violation of the tender conditions, the 155-page petition filed by Reliance said. Since the government and GMR-Fraport had filed caveats in the high court, they have been informed of the petition. It is understood that the petition would be taken up tomorrow in the Delhi High Court.
The case could turn into a long-drawn affair if the petition is admitted. Reliance Airport has named Airports Authority of India (AAI), the government (through the civil aviation ministry), GMRFraport and GVK-South African Airports as respondents. The contention of the ADA group is that, if the original tender process was followed, GMR would have got neither airports let alone definitely getting one, and with an option to choose between the two. It is learnt that Reliance Airport Developers will be represented by advocate Mukul Rohatgi, and is being advised by top-notch legal brain Fali Nariman.
ADA group is basically fighting the battle with the government on two counts: first, after the government has clearly specified tender conditions, it cannot go back and change the terms at the last minute. And that differential standards cannot be applied to GMR and Reliance Airport. After all, GMR has been selected as the partner for Delhi though Reliance’s financial bid was the best. The government had given GMR the chance to match the best financial bid since it was the only technicallyqualified bidder. Reliance Airport has said in its petition that it was the second best in terms of technical qualification. This should have won the Anil Ambani Group the right to match the best offer for the second airport and win the deal, if the government had applied the same criterion for both airports.
However, the government treated all bidders as the same in the case of the second airport since they were all rated as being below the technical qualification benchmark of 80%.

Airport recast: Govt files caveats

Our Delhi Bureau 2 FEBRUARY
RELIANCE Airport Developers has filed a petition in the Delhi HC against the selection of GMR-Fraport and GVK-South African Airports as partners for the Delhi and Mumbai airports, respectively. GVK won the Mumbai airport on the strength of its financial bid even though its technical ranking was far lower than that of Reliance. “The decision-making process in the present case has been completely discriminatory, arbitrary, and has been actuated by mala fides. It is a case of constantly shifting goal posts with the sole intent of benefiting certain parties while excluding the petitioner. The rules of the game have changed mid-course,” reads the petition, a copy of which is with ET.
It is understood that Reliance Airport has also written to the civil aviation secretary alleging a conflict of interest since AAI chairman K Ramalingam and civil aviation ministry joint secretary Sanjoy Narayan, both involved in the evaluation, were board members of Hyderabad International Airport, a joint venture between GMR and AAI. A similar communication has been set to members of the empowered group of ministers (eGOM) headed by defence minister Pranab Mukherjee, it is learnt. The eGOM had approved the selection process before it was cleared by the Cabinet. In a letter to finance minister P Chidambaram and copy to all members of the eGOM, Reliance has said: “These two persons have played an active role in the entire decision-making process.”
Civil aviation secretary Ajay Prasad said the government will go ahead with implementation of the Cabinet’s decision on the selection of partners. “We have received intimation about the petition and will file our reply with the court. Meanwhile, implementation of the policy decision will go on,” he said. While he declined to elaborate, stating that the case was sub judice, current indications are that the government will formally inform GMR and GVK of their selection. Follow-up action like initiation of technical agreements is also likely unless the court issues a stay order. The government has filed caveats in the SC and the Bombay HC, Mr Prasad said.
The 155-page petition chronicles the entire history of the evaluation process to seek scrapping of the selection of partners.



Sensex ends below 9,850 mark

The Sensex ended the day below 9,850 after oscillating 140 points either ways. Extensive selling happened near all-time high levels, preventing the Sensex from breaching the 10,000-mark.

The Sensex had hit an all-time high of 9993.92 on 01 February 2006.

The BSE Sensex advanced sharply by 682 points, from the close of 9237.53 on 18 January 2006 to close at 9,919.89.

The BSE Sensex ended the day at 9843.87 points, which is 15.39 lower than its previous close.

The NSE Nifty also ended the day with a loss of 4 points at 2967.45.

The Sensex opened with a positive gap of 32 points at 9,890.90, buoyed by resumption in FII-buying. On Tuesday (31 January 2006), FIIs lifted shares worth a net Rs 217.40 crore from the market, spreading cheer in opening trade.

The high and the low for the Sensex was at 9,956.10 andat 9,816.01 points respectively.

The total turnover amounted to Rs 3,340 crore while the market breadth was weak at 1:2.1. As many as 803 stocks advanced, 1,696 declined, while 53 remained unchanged.

The BSE Mid-cap index ended 0.30% higher while the BSE Small-cap index lost 0.70%.

The BSE Metal index advanced 1.95% while the BSE Healthcare index flared 2.25%.

Among the Sensex stocks, 14 moved higher as 16 dipped.

Cipla was the biggest gainer from the pack, up 11.35% to Rs 492, on a staggering 20.49 lakh shares, after the company scheduled a board meet for 11 February 2006 to discuss a bonus issue.

Bharti Televentures spurted 4.15% to Rs 365 on speculation of strong new subscription addition for the month of January 2006. HLL flared 1.2% to Rs 193.50

Ranbaxy added 2.3% to Rs 392.65 and Bhel gained 3% to Rs 1,847 on renewed buying after it reported robust Q3 results.

REL lost 1.2% to Rs 604.65 after its consortium failed to get a government contract to modernise the Delhi airport.

MTNL lost 0.4% to Rs 135 after its ADR lost 6% overnight on NYSE.

ONGC lost 2.1% to Rs 1195.95 on 7.69 lakh shares.

SBI was the top-traded counter on BSE, aggregating Rs 125.44 crore followed by Cipla with Rs 99.93 crore and RIL with Rs 98.63 crore.

Side-counters Sirpur Paper, Gujarat Alkali, Titanor Components, National Peroxide, Fortis Financial, Transcorp International, Alchemist, Gateway Distriparks, Jain Irrigation, Madhucon Projects, Amtek Auto, Cheviot and Prism cement among others surged.

KIC Metalics, Shetron, Raj Rayon, Tulip IT Services, Caprihans, Sacheta Metals and Roto Pumps, each slumped 10%

Nitin Spinners debuted today at Rs 28.05 on BSE. It ended at 26.20 – a 25% premium to issue price of Rs 21. It went on to hit a high of Rs 31 while its low was at Rs 25.30. The stock saw a huge volume of 1.82 crore shares.

Hexaware Technologies spurted 5.3% to Rs 130 after its Q4 December 2005 net profit increased 15.4% to Rs 24.75 crore (Rs 21.45 crore).

Commercial vehicles manufacturer, Ashok Leyland, surged 7.3% to Rs 34.45 after it bagged a Rs 230-crore order from the Indian army for supplying 872 specialised water carriers.

National Aluminium Company jumped 8.2% to Rs 307 tracking firm global aluminium prices with LME aluminium price hitting a 17-1/2 year high of $ 2,565 on Wednesday (1 February).

ACC flared 3.3% to Rs 593.90 after it reported a 10% rise in January despatches to 1.65 mt from 1.50 mt.

Jubilant Organosys rose 2.9% to Rs 1,069.90 after it bagged $ 40 million worth of contracts for custom-manufacturing of agrochemical intermediates and fine chemicals. The orders are from players who are leaders in pharmaceutical and agrochemical industry globally.

Mercator Lines closed at Rs 55.45 on 4.83 lakh shares after it went ex-bonus today in 3:2 (3 bonus shares for every two held). The stock had closed at Rs 141.75 yesterday.

JK Paper firmed 1.1% to Rs 60.65 following print media reports that International Finance Corporation (IFC) is likely to buy over 10% stake in the paper company.

United Phosphorous flared 4.7% higher to Rs 290 on reports that the company is eyeing acquisition in Europe in the range of $ 150-200 million.

Sterlite Industries jumped 8.75% to Rs 1,424 after it said its board will meet on 10 February 2006 to consider stock-split and a bonus issue.

Mather & Platt Pumps plunged 5% to Rs 190.05 after the company reported dismal Q3 December 2005 results. It posted a net profit of Rs 0.34 crore for the Q3 December 2005 compared to a net profit of Rs 1.14 crore in Q3 December 2004. Net sales rose 15.5% to Rs 23.64 crore (Rs 20.45 crore).

Jet Airways slipped 1.65% to Rs 921 on 2.62 lakh shares. The stock hit a new all-time low of Rs 891.15. NSE had banned further F&O positions in the stock yesterday.

Today’s Writing spurted 6.25% to Rs 77.35 on 3.20 lakh shares while KEC International jumped 10.54% to Rs 363 on 2.43 lakh shares.



Bharti Tele-Ventures rings in gain

Bharti Tele-Ventures surged today on renewed buying amid expectation of strong new subscription addition for last month..

Bharti Tele-Ventures (BTL) stock rose 4% to Rs 363.50 on 2.18 lakh shares on BSE.

The stock has bounced back from a lower level in the past few days. From a recent low of Rs 330.15 on 18 January, it had edged up to Rs 350.45 on 1 February 2006.

Over the past few months, the scrip has witnessed volatility due to alternate bouts of buying and selling. The scrip moved between Rs 312-373 since late October 2005.

At the beginning of every month, BTLs announces its subscription figure for the preceding month. Expectation of strong growth in cellular services subscribers will continue on the back of new schemes launched by cellular service providers.

BTL has been witnessing a solid growth in its cellular services. In December 2005, BTL added 9.11 lakh new subscribers, taking its total cellular subscription base to 163.27 lakh.

BTL's consolidated Q3 December 2005 net profit rose 25% to Rs 545.20 crore (Rs 436.30 crore). Revenue rose 42% to Rs 3,025.60 crore (Rs 2131.90 crore).



United Phosphorous in demand

United Phosphorous surged 2.8% to Rs 285 amid reports of the company’s acquisition plan in Europe.

As many as 1.17 lakh shares were traded on the BSE.

The scrip was hit by intra-day volatility as it moved between Rs 278- Rs 288.

The stock had spurted 10.6% on Wednesday (25 January) to Rs 290.60, boosted by media reports that it may come out with a bonus issue. But it lost 4.2% the next trading session to Rs 278.15 after the company said there was no such proposal pending before the board.

As per reports, United Phosphorous proposed acquisition deal in Europe could range from $ 150-200 million.

The company had registered a 54% increase in its Q3 consolidated net profit at Rs 23.14 crore. Sales rose 27% to Rs 383.80 crore.

In December 2005, the company’s shareholders had authorised the board to borrow money not exceeding a sum of Rs 3,000 crore and to make an international offering to collect $ 150 million in one or more tranches. The offering may be in the form of FCCBs or GDRs/ADRs or any other financial instrument, which the board may deem fit.

United Phosphorous had recently acquired 100 % stake of an Argentinian company, Reposo, in a deal worth $ 11 million. This includes the entire equity, including assets of the company, product registrations, manufacturing site and all other property rights associated with the businesses of the Argentinian firm.

United Phosphorus is a leading manufacturer of crop protection products with a wide-range that includes fumigants, fungicides, insecticides, rodenticides and herbicides. The company ranks fourth amongst the generic agrochemical companies in the world. It also manufactures chlor-alkali products, industrial chemicals and specialty chemicals.



Sterlite Industries surges on bonus, stock-split proposal

Sterlite Industries jumped 5.5% to Rs 1,382 after informing that its board is considering stock-split and a bonus issue.

As many as 2.1 lakh shares changed hands in the counter on BSE.

Rising global copper and aluminium prices boosted the Sterlite Industries' scrip in recent months. From a low of Rs 698.70 on 28 October 2005, it surged to Rs 1,309.70 by 1 February 2006.

Sterlite Industries' book value was a robust Rs 323.90 per share (face value Rs 5) as on 31 March 2005. A board meeting has been convened on 10 February 2006 to discuss a bonus issue and the splitting of the scrip.

Sterlite Industries is mainly in the copper business. It also has a major presence in aluminium, through its subsidiary Bharat Aluminum Company (Balco), and minerals. It also has major presence in zinc through another subsidiary Hindustan Zinc.

Domestic aluminium makers have raised prices over the past few months tracking firm global prices. On Wednesday (1 February 2006), global aluminium price hit 17-1/2 year high of $ 2,565 a tonne. On the same day, copper price hit a high of $ 4,870 a tonne.

Sterlite's consolidated Q3 December 2005 net profit jumped 68% to Rs 395.04 crore (Rs 235.40 crore). Sales rose 78% to Rs 3,511.38 crore (Rs 1,969 crore).



Dispatches figure inspires buying in ACC

Cement major ACC rose 2.4% to Rs 589 on the back of surge in cement dispatches in January 2006.

The stock reached climbed to Rs 590.40, an all-time high for the scrip. A total of 2.5 lakh shares changed hands in the counter on BSE.

The stock has firmed up in the past few days although its Q3 results did not live up to market expectations. From a recent low of Rs 544 on 23 January, it surged to Rs 575 by 1 February 2006. A strong uptrend was witnessed in the stock during late October-early December 2005, the period of when the entire market rallied strongly.

ACC's dispatches rose 9.5% in January 2006 to 16.48 lakh tonnes. Cement production jumped 10.1% to 16.46 lakh tonnes.

ACC's profit after tax jumped 75.6% to Rs 94.12 crore from Rs 53.58 crore in Q3 December 2004. Net sales rose 12.2% to Rs 1,072.07 crore (Rs 955.33 crore).

Demand for cement from rural housing sector has soared following a good monsoon last year and companies have been hiking prices of the commodity since the past few months. Late in January 2006, top cement producers raised retail prices by an average Rs 2 per bag in the Mumbai market, the country's largest. Retail cement prices have gone up to Rs 185-188 per 50-kg bag.

After exiting from the refractory division, ACC has begun consolidating existing businesses. ACC has also acquired a stake in ready mixed concrete company Tarmac India.

In January 2005, the world's second largest cement maker, Holcim, acquired control over ACC.



Nalco retains lustre

National Aluminium Company jumped 4% to Rs 295 tracking firm global aluminium prices.

As many as 4.2 lakh shares changed hands in the counter on BSE.

On Wednesday (1 February 2006), the stock had gained 3% to Rs 283.80 after it hiked domestic aluminium prices by Rs 5,000 per tonne, taking cue from firm global markets. A day ahead of the announcement (31 January), it had spurted 7.4% to Rs 275.40.

LME aluminium price hit a 17-1/2 year high of $ 2,565 on Wednesday (1 February).

Nalco had hiked prices by Rs 3,500 in the beginning and by Rs 2,500 in the middle of last month.

The world aluminium industry is facing a crisis due to high energy costs and many units have either shut shop or cut down production, causing LME aluminium prices to rally. Buying by hedge funds, too, has helped propel rally in base metals like copper and aluminium.

Nalco's net profit rose 28% in Q3 December 2005 to Rs 393.03 crore (Rs 306.07 crore). Sales rose 22% to Rs 1,324.90 crore (Rs 1,090.05 crore)



Bids sidelined, Reliance Energy hard hit

Reliance Energy lost for the second successive day after its consortium failed to get a government contract to modernise the Delhi airport.

Reliance Energy (REL) scrip was down 1.3% by mid-morning trade to Rs 603.50. As many as 60,314 shares changed hands in the counter on BSE. On Wednesday (1 February), REL stock had lost nearly 4% to Rs 612 following the news of bids of its competitors being cleared by the cabinet after trading hours on 31 January 2006.

After surging during late November-early December 2005, the stock became a bit volatile later. It has moved between Rs 578-Rs 656 since 9 December 2005.

The government has awarded the contract to modernise the New Delhi airport to a consortium led by the GMR group in collaboration with Fraport, a German airport operator. REL's financial bid was the highest but GMR was offered the chance to match REL's financial bid as its bid was deemed to be technically better qualified.

REL, now a part of Anil Dhirubhai Ambani Group, is a leading private sector utility company. The group distributes nearly 21 billion units of power to over 25 million consumers in Mumbai, Delhi, Orissa and Goa. REL generates 941 MW of power, through its power plants located in Maharashtra, Andhra Pradesh, Kerala, Karnataka and Goa.

REL's Q3 December 2005 net profit rose 23% to Rs 164.64 crore (Rs 134.22 crore). Net sales rose 6% to Rs 988.35 crore (Rs 929.13 crore).



Jubilant Organosys jubilant on new orders

Jubilant Organosys rose nearly 3% to Rs 1,069.95 having bagged $ 40 million worth of contracts for custom manufacturing of agrochemical intermediates and fine chemicals.

As many as 2,172 shares changed hands in the counter on BSE.

A major correction took place in the stock from mid-January 2006 despite the company reporting strong Q3 results. From a recent high of Rs 1,190.55 on 10 January 2006, it slipped to Rs 1,039.15 by 1 February 2006. Earlier, the stock had risen, in the run up to the results, from a low of Rs 990.55 on 8 December 2005.

The company said it has bagged the new contracts worth $ 40 million from global leaders in pharmaceuticals and agrochemicals industry.

The company has also signed CRAMS (contract-research and manufacturing) orders worth $ 28 million for calendar year 2007, with various global life sciences firms. The company also said talks are on with several others and expects more such contracts.

The company has over the last year invested around Rs 150 crore on enhancing its capabilities in R&D and manufacturing of advance intermediates and fine chemicals which are used in pharmaceutical and agrochemical industries.

For Q3 December 2005, Jubilant Organosys's consolidated net profit rose 36% to Rs 36.60 crore (Rs 26.90 crore). Operating income jumped 47% to Rs 423.40 crore.



Ashok Leyland revs up on new order

Ashok Leyland jumped 5.6% to Rs 33.90 on high early volume 43 lakh shares on BSE after reports that it has been asked to supply equipment to the defense sector.

A sharp drop in oil price on Wednesday lent further weight to the stock. US crude for March delivery fell $1.36 to settle at $66.56 on Wednesday after a weekly US government data showed rise in crude, gasoline and heating oil inventories. High oil prices often weigh on auto stocks on concerns that it may impact sales.

On Wednesday (1 February) 2006, Ashok Leyland's stock had risen nearly 5% to Rs 32.10 on a high volume of 42.4 lakh shares on BSE.

Earlier, the stock had seen a surge during late October-late November 2005 and became a bit volatile later due to alternate bouts of buying and selling. The volatility in the stock, however, was limited to a narrow range. The stock has moved between Rs 30-33 since late November 2005.

Ashok Leyland (ALL) has bagged an order worth Rs 230 crore from the Indian army for products and spares, say media reports.

After trading hours on 31 January, ALL reported flat Q3 December 2005 results. ALL's performance in Q3 December 2005 was impacted by excessive rains in South India where it has a strong presence, .

ALL's Q3 December 2005 net profit rose 2% to Rs 54.47 crore (Rs 53.66 crore). Turnover rose 22% to Rs 1202.4 crore (Rs 987.11 crore).

ALL plans to invest Rs 550 crore in the next two years on capacity expansion for all its commercial vehicles. This will include setting up of a unit in Dubai to build bodies of buses, a bus manufacturing factory in North India and a unit to manufacture gears for export. The plan is to take the capacity to 1 lakh units from the current 77,000 units per annum.

At present, ALL's product basket is oriented towards medium and heavy commercial vehicles. The company has indicated that it is working on finding the most effective way to strengthen its position in light commercial vehicles (LCVs). The company wants to enter the LCV segment through acquisitions and had zeroed in on a few players.



Nahar Industrial members approve increase in Authorised Capital

Nahar Industrial Enterprises Ltd has informed that the members at the Extra Ordinary General Meeting (EGM) of the Company held on January 30, 2006, inter alia, have accorded to the following:

1. Increase in Authorised Share Capital of the Company from Rs 50,00,00,000/- divided into 4,00,00,000 equity share of Rs 10/- each and 10,00,000 7% Non-Cumulative Redeemable Preference Shares of Rs 100/- each, to Rs 65,00,00,000/- divided into 5,50,00,000 equity shares of Rs 10/- each and 10,00,000 7% Non-Cumulative Redeemable Preference Shares of Rs 100/- each and consequential amendments in Memorandum & Article of Association of the Company.

2. Authority to the Board to issue, offer and allot in the course of an international offering to the eligible foreign investors by way of circulation of any offering circular or prospectus or by way of private placement basis, Foreign Currency Convertible Bonds (FCCBs) / Global Depository Receipts (GDRs) or any other equity linked financial instrument in foreign convertible currency equivalent to the aggregate principal amount upto USD 40 million with an option to retain out of over subscription of additional USD 5 Million (green shoe option), subject to necessary approvals.



Jaiprakash Associates, NMDC may remain in the thick of action

Jaiprakash Associates, subject to requisite approvals, may see action after it launched an FCCB issue of Euro 125 million with an option to increase the size by an additional Euro 40 million on 01 February 2006.

National Mineral Development Corporation is expected to remain in the limelight after its Board of Directors approved a second interim dividend of 115.4%. This is in addition to the first interim dividend of 76.93% paid in November 2005, taking the total interim dividend to 192.33% for FY-06 on the paid-up equity share-capital.

Jubilant Organosys may edge higher after announcing that the company has added to its order-book contracts worth $ 40 million with global life sciences companies for calendar year 2006. The company has also signed annual CRAMS contract worth $ 28 million for calendar year 2007 with various global life sciences companies.

Ramco Industries is expected to move after the Board of Directors at a meeting held on 30 January 2006 declared a second interim dividend of Rs 5 per equity share of Rs 10 each fully paid-up (50%) for the current financial year 2005-06.

Mphasis BFL may edge after the Karnataka High Court sanctioned the scheme of amalgamation and arrangement between itself and Kshema Technologies. The court's order has also been filed with the Registrar of Companies, Karnataka.

Shree Ram Mills may rise after it informed that the Board of Directors will meet 09 February 2006 to consider a bonus issue of equity shares.

Jet Airways may remain in action after it announced yesterday the launching of two new flights. India's largest private-sector airline will operate direct flights on Bangalore-Trivandrum-Bangalore and Chennai-Trivandrurn-Chennai routes with effect from 01 February 2006. The company has strengthened its domestic network by inducting its 53rd aircraft, a Boeing -737, and with it more services on the domestic routes. Jet Airways will also operate an early morning service from Pune to Bangalore and an evening service from Bangalore to Pune, giving day-return facility for passengers from Pune.

Ashok Leyland may edge higher on reports that it has received a Rs 230 crore order from the Indian army to supply products and spares. Ahead of the news, the stock rose nearly 5% on Wednesday (1 February) to Rs 32.10, on heavy volume of 42.4 lakh shares on BSE.

JK Paper may see action on reports that it has decided to place 10% stake with International Finance Corporation at Rs 65 per share through preferential issue of shares. The stock settled at Rs 60 on BSE on 1 February 2006.

United Phosphorus - the largest generic agrochemical company may see action on reports that it is planning an acquisition in Europe. The deal could be in the range of $ 150 million to $ 200 million.

Apollo Hospitals may see action on reports that HDFC may join hands with Apollo Hospitals to set up two-three super specialty hospitals in Mumbai.

Lupin may see action on reports that it is in talks with a manufacturing and distribution company in Australia to float a marketing joint venture. The JV will mark Lupin's maiden entry into Australian markets with its branded generics.



Cipla mulls Bonus shares issue

Cipla Ltd has informed that a meeting of the Board of Directors of the Company will be held on February 11, 2006, inter alia, to consider the following:

1. Issue of bonus shares.

2. Further issue of securities in the domestic and / or international market.

3. Increase in the limit of investment by Foreign Institutional Investors into the paid-up capital / securities of the Company.


Cipla jumped nearly 10% to Rs 485 after scheduling a board meet for 11 February 2006 to consider a bonus issue.

By first few minutes of trade, 1.1 lakh shares changed hands in the counter on BSE.

The market had been agog with rumours over the past two months that Cipla may declare a bonus issue. However, the scrip was quite range-bound since mid-December 2005 following a rally during late October-early December 2005. From a low of Rs 348.25 on 28 October 2005, the stock had edged up to Rs 441.85 by 1 February 2006.

Cipla has a book value of Rs 51.50 per share (face value of the scrip is Rs 2).

Along with the bonus issue, Cipla's board will also consider the raising of FII investment ceiling and issue of securities in the domestic and/or international market.

Cipla reported 39.5% growth in Q3 December 2005 net profit to Rs 175 crore as sales rose 30.1% to Rs 780.62 crore, helped by a 36% jump in exports and 18% domestic sales growth. Cipla also received Rs 72.70 crore in Q3 December 2005 from insurance companies for the damage to its storehouse during floods in Mumbai during July 2005.

Cipla, a strong player in anti-AIDS drugs and anti-asthmatics, has adopted a partnership strategy to penetrate the US market, rather than registering and selling drugs on its own, and it now has eight partners



Steel sector in a twist as future’s not too bright

THE performance of steel companies in the December ’05 quarter is a pale version of the robust performance seen in the same quarter last year. Last year, steel companies were ruling the roost with steel prices at record highs and input prices still not pinching. This quarter has seen a reversal in fortunes, with steel prices down 30-40% Y-o-Y and costs up. Last month saw a slight recovery in global prices. There are also signs of a downward correction in raw material prices. However, the sector can look forward to a brighter future.
China continues to play an important role and a lot hinges on the ability of the Chinese to control output from the domestic steel industry. Numbers from the three largest Indian steel makers are a tad disappointing. SAIL’s net sales declined 18% to Rs 6,334 crore, while its net profit has suffered a steep decline of 55% to Rs 684 crore on account of a dip in its operating profit margins that dropped to 17% from last year’s 36%. Tata Steel has done relatively better with a 1% drop in sales and a 15% drop in profit while operating margins have dropped to 31% from 38% last year.
JSW Steel, the third largest company, recorded a 11% drop in sales and a 35% drop in profits over the past year, while its operating profit margins dropped to 22% from 29%. The drops were largest when volumes growth was muted. The insulation offered by captive sources against market pressures also comes into play, as companies with a higher amount of self-reliance would be better placed in an adverse market. But these numbers do not give the complete picture. The steel makers are struggling as pricing pressures squeeze them from both sides. Steel prices after sinking 30-35% lower than their peaks, have stabilised at much lower levels. Meanwhile, prices of raw materials such as coal and iron ore saw an increase of more than 70%. The full impact of these changes was apparent in the results for the December-ended quarter. What the future holds for the steel industry is more interesting. It is certain that with the fall in steel prices, coal and ore prices will also come down in the near term. Contracts for semi-soft coking coal are being settled in Australia for 30-35% lower than last year’s prices. BHP Billiton has just settled a coking coal contract at 8-16% price cuts for various grades of coal. Prices of almost all input, except for iron ore, have come down in the wake of melting steel prices.
However, it will be premature to expect profits for steel companies to improve. There is still a massive Chinese capacity overhang. Chinese production in December rose 21% over last year and touched 32mt, despite the Chinese claims of a consolidation in their steel sector. The world production of crude steel during December was 6% higher than last year at 96mt.




HDFC powers ahead on growth prospects

THERE was increased buying on the HDFC counter on expectations that the rise in the economy would lead to better growth prospects for the mortgage major. The stock was up 3.3% at Rs 1,385 with 1,51,552 shares changing hands on the BSE.

Thermax counter ticking SHARES of engineering major

Thermax were up 4.9% at Rs 1,196 on Wednesday. Traders said investor interest in the pollution control equipment leader was mainly due to the government’s recent measures on environmental legislation, which could benefit the company most. The stock saw volumes of 68,882 shares on the BSE.


ONGC’s Nigeria plans on hold

ONGC’s plan to acquire oil assets in Nigeria may have to wait a while with the Cabinet deferring a decision on ONGC Videsh’s (OVL) plans to re-enter Nigeria’s exploration sector by taking up interests in two blocks bid earlier. OVL, which had lost out the race to Korean companies despite having put in the highest bid, has sought permission to re-enter the race for two exploration blocks—OPL-321 and OPL-323 in Nigeria. The Cabinet, however, deferred the issue and a decision is slated to be taken later. OVL’s chances of reentering the fray brightened with Korean National Oil (KNOC) delaying the submission of bank guarantees for payment of signature bonus. Sources said the empowered committee of secretaries will be meeting shortly to discuss the matter before it will be referred back to the Cabinet. Some reservations were expressed by some ECS members about the prospects of oil and gas in these fields. The Cabinet’s decision to defer the matter comes close on the heels of an earlier instance when OVL’s plans of buying out the Akpo oilfields in Nigeria for almost $2bn. This proposal, however, was turned down by the government as it was found to be a risky investment. OVL was the top bidder for two exploration blocks but lost to KNOC, as the Nigerian government, has given the first right of refusal to the Korean firm. OVL had earlier sought the government’s permission to pay a signature bonus of $485m to the Nigerian department of petroleum resources.



JK Paper may place 10% equity with IFC, raise Rs 100 cr

IN WHAT could become the third such transaction, the World Bank’s International Finance Corp (IFC), is likely to soon buy over 10% equity stake in JK Paper. In a capital restructuring exercise, India’s fourth largest paper maker said it will generate Rs 100 crore via an equity raising programme that will include allotting Rs 50 crore worth of equity shares each to IFC and the promoter group at Rs 65 a share. In the shareholding pattern, the promoters’ JK Industries and JK Agri Genetics own 12.1% each, investment company BMF Beltings has 2.8%, while JK Lakshmi Cement owns 13.4%. The company has been promoted by the Singhania family. On Wednesday, JK Paper’s shares fell 4.9% to Rs 60 on the BSE, with the volume at 95,966 shares. “The money would be used to part finance our plan to set up a packaging board project in Gujarat,” Harsh Pati Singhania, MD, told ET. “IFC is interested in partnering us and is confident that the paper industry has lot of growth,” he added. JK Paper, which currently makes 180,000 tonnes of paper a year, is planning to build a 60,000 tonne multilayer packaging plant. This is the third time that IFC has expressed interest in an Indian paper company. The multilateral lending agency had recently invested about $40m for part financing a capacity expansion programme in the LN Bangur-owned AP Paper Mill. The amount included the purchase of 9.6% of the company’s equity. IFC is also likely to invest about Rs 150 crore in West Coast’s expansion project that is estimated to cost about Rs 870 crore. The investment is also likely to include the cost of 5% of the company’s equity capital. The Indian paper industry is among the fastest-growing sectors, with demand rising by 6-7% every year, compared with 2.2% in developed countries. As it is linked to the economy, which grew 8.1% in Q2, research companies expect more scope for the sector. Most of the big names in the sector — Blackstone, Chrys Capital, New Vernon — have shown interest.



Growel to get a Spanish partner

AFTER global private equity funds, it’s now the turn of foreign majors to tap the Indian auto component growth story. Spain’s Sid, it’s learnt, ais close to forming a JV with the Mumbai-based Growel group to make high-end chemicals for use in the automotive component sector. Though the Rs 200-crore Growel group has no plans to offer equity participation to the Spanish firm, chairman Umesh More said he isn’t ruling out “such a possibility” . “We’ll decide after seeing the performance of the new JV,” he told ET. The Growel group, with interests in real estate and software, plans to set up a 50:50 JV with Sida. This will allow group company Grauer & Weil to use Sida’s customer base, including auto majors such as Renault, GM, Volkswagen and others. Mr More and his family own about 52% in Grauer & Weil, the public hold the rest. “Sida is among the top-most OEM suppliers in Europe and is convinced of the growth in the Indian automotive market. It’s estimated that the Indian component export market may rise to $25bn in ’15 from the current $1.6bn,” said Mr More. The two partners will initially invest about Rs 90 lakh in the JV. The JV will focus on high-end, chrome-free electroplating products in line with new environmental standards in Europe and the US. Growel plans to develop real estate assets, including 3 acres in Chembur and 5-acre factory land on the Pune-Mumbai highway. It has offered on lease over 65,000 sq feet of its factory land to the Pantaloon-promoted Big Bazaar at Kandivali. Sida’s entry into India comes at a time when global components majors like Magna, Textron, Precision Castparts and Faurecia have expressed interest to set up shop in India. India is an attractive market for such companies as the country boasts of low labour costs and high quality engineering skills. While labour costs in developed countries are about 30-35% of sales, they are just 8-9% in India.



ChrysCap sells 6.5% stake in MphasiS for Rs 130 cr

AMIDST all the hype about Baring’s divestment plans in MphasiS, another private equity player, ChrysCapital, has quietly exited the IT services company. ChrysCapital sold its near 6.5% stake in MphasiS for Rs 130 crore through the secondary market route. According to sources, this transaction took place in late ’05. Consequently, ChrysCapital’s shareholding in MphasiS is now nil. It originally held around 14% in the company, of which around 8% was sold about 18 months earlier. A s h i s h Dhawan, senior managing director, ChrysCapital, however continues to remain on the MphasiS board as an independent director. Sources termed the private equity fund’s move to exit the IT services major as a pure “financial decision”. MphasiS was one of ChrysCapital’s early high-profile investments and the private equity fund has been able to generate a handsome return of five times on its original investment. While ChrysCapital had bought its holding in MphasiS at Rs 31 per share (adjusted for stock splits), the blended sale price across the two sales tranches has been around Rs 150 per share. ChrysCapital recently raised a $550m fund, and now manages $1bn across four funds. With over 30 investments since 1999, it aspires to build a leading investment fund focused on India. Its portfolio of investments includes Yes Bank, the Shriram group, IVRCL, Suzlon, Micro Inks, Balakrishna Tyres, and Intas Pharma.



STCI to acquire UTI Securities for Rs 265 crore

SECURITIES Trading Corporation of India (STCI), one of the largest government bond houses in India, will acquire UTI Securities, the brokerage and investment banking arm of the erstwhile Unit Trust of India. STCI has outbid the British bank, Standard Chartered, and Bank of Baroda, and will pay Rs 265 crore for the transaction. Bank of Baroda and StanChart had made bids Rs 250 crore and Rs 220 crore, respectively, against a reserve price of Rs 150 crore. STCI will be allowed to use the UTI brand for two years. With the acquisition, STCI will get an entry into a well-diversified range of services like equity trading, portfolio management, depository services, merchant banking and commodity trading. G Narayanan, managing director, STCI, told ET, “We were looking for diversification. With our kind of resources, primary dealership Securities has a presence in major cities with 20 branches and 150 franchisees. In terms of the arrangement with STCI to acquire UTI Securities for Rs 265 croreUTI-I, the company has to retain employees for one year, while the managing director has to be retained as a wholetime director for a year. business alone is not sustainable. We are very excited.” A turn in the interest rate cycle, regulatory restrictions and absence of short-selling have made the going tough for most bond market players. UTI Securities will give STCI a greater distribution reach across India. UTI STCI plans to retail UTI-Securities as separate entity STCI managing director G Narayanan said,“We have found the company to have excellent employees and plan to retain them.” STCI plans to retail UTI Securities as a separate entity. “Our plan is to hive off the primary dealership activity into a separate company with STCI becoming a holding company,” Mr Narayanan said. UTI Securities may complement the primary dealership business by helping STCI distribute government securities to high net worth individuals, provident funds and smaller banks.



Sensex retreats from the vicinity of 10,000-mark

The market came within the striking distance of the 10,000 mark today in what was to be a highly volatile trading session. Volatility was high in opening as well as in the last hour of trade.
The Sensex had surged in mid-afternoon trade and had come within striking distance of 10,000 before a sell-off pulled it down by as much as 100 points, at one point of time, in late trade.
In early trade, Sensex had slipped into the red after a firm opening.
The barometer index ended with a loss of 60.63 points (0.6%) to settle at 9,859.26. It moved 174.60 points for the day, between a low of 9,819.32 and a high of 9,993.92. The S&P CNX Nifty lost 29.55 points (0.9%) to settle at 2,971.55.
The market breadth was extremely weak as 1,935 stocks declined on BSE as compared to 561 that rose. A meagre 49 scrips were unchanged. Losers outpaced gainers by a ratio of 3.44:1.
Key Asian markets were subdued after the US Federal Reserve indicated that more interest rate hikes may be needed to curb inflation. The Fed on Tuesday hiked interest rates by 25 basis points from 4.25% to 4.5%. On Wednesday, a sharp fall is expected on Wall Street as Google missed analysts' profit target for the first time.
Banking stocks slipped after the US Federal Reserve raised interest rates by 25 basis points, indicating that more rate hikes may be on cards.
Select construction scrips moved higher even as sugar scrips slipped on profit-taking, after a recent sharp surge in their prices. Stocks edged up selectively; Cummins India, Voltas, Thermax, Bharat Bijlee rallied on the back of strong Q3 numbers.
BSE clocked a turnover of Rs 4,014 crore, higher than Tuesday's Rs 3,965.81 crore.
Reliance Energy dropped 3.8% to Rs 612 after its consortium failed to get a government contract to modernise the Delhi airport.
L&T jumped 5.4% to Rs 2,285 on renewed buying on the back of its strong order book. A humungous 7.7 lakh shares changed hands in the counter on BSE.
Dr Reddy's Lab gained 5% to Rs 1,180 on reports that it had entered into a sales-agreement with US drug-maker Merck & Co. However, Ranbaxy lost 3% to Rs 386.
Zee Telefilms plunged 5.5% to Rs 155 after it reported a 17.5% fall in Q3 December 2005 net profit to Rs 31.70 crore (Rs 38.41 crore). Net sales rose 30.6% to Rs 231.38 crore.
MTNL plunged 5% to Rs 134.60 on 2.6 lakh shares in the counter on BSE.
Bank stocks came under pressure. HDFC Bank lost 3.4% to Rs 736, ICICI Bank lost 3% to Rs 589 and State Bank of India shed 1.9% to Rs 869.
Housing finance major, HDFC, rose 4% to Rs 1,395 after it raised interest rate on housing loan by 50 basis points.
Cummins India jumped 12% to Rs 199.70 on the back of strong Q3 results. The stock rose on heavy volume of 37.9 lakh shares. Cummins India's net profit has jumped 47.54% to Rs 48.47 crore. Net sales has risen 31.3% to Rs 389.79 crore (Rs 296.76 crore).
It was a double-whammy for Jet Airways. The stock plunged 6.8% to Rs 928.70. Oil companies raised aviation turbine prices with immediate effect. Meanwhile, the NSE banned fresh F&O positions in Jet Airways as F&O position in the scrip had crossed 95% of the market-wide position limit.
Patni Computer lost 4% to Rs 464 in volatile after it reported a fall in Q4 December 2005 net profit. Patni Computer has reported a net profit of Rs 34.49 crore for Q3 December 2005 compared to Rs 58.93 crore in Q4 December 2004.
Car major Maruti Udyog (MUL) dropped 1.9% to Rs 742.10. MUL's domestic car sales rose 7.6% to 48,229 in January 2006.
Gujarat Ambuja Cements lost 3% to Rs 85.70 whereas another cement major Grasim rose 2.7% to Rs 1,492.
Index heavyweight Reliance Industries lost 0.8% to Rs 707.55 on 16.2 lakh shares.
PSU aluminium major National Aluminium Company gained 3% to Rs 284 but Hindalco lost 1.2% to Rs 162.70 after the two companies raised aluminium prices with immediate effect. Tracking firm global prices, Hindalco has raised domestic prices of aluminium by Rs 6,000 a tonne with immediate effect. Nalco has hiked prices by Rs 5,000 per tonne. On 31 January, LME aluminium price hit a 17-1/2 years high of $ 2,526 a tonne.
Voltas rallied 7% to Rs 717.50 on the back of strong Q3 results. Voltas reported a 68% spurt in net profit for Q3 ended December 2005 to Rs 11.36 crore (Rs 6.76 crore). Net sales rose 55% to Rs 447.09 crore (Rs 288.42 crore).
Ashok Leyland rose on high volume. It shot up 5.8% to Rs 32.45 as 42.3 lakh shares changed hands in the counter on BSE. Ashok Leyland has reported 1.6% growth in Q3 December 2005 net profit to Rs 54.51 crore (Rs 53.65 crore). Net sales has risen 21.8% to Rs 1,201.43 crore.
Oral care specialist Colgate rose 3.2% to Rs 352.95 on high volume of 10.9 lakh shares. It has reported robust Q3 results which sent the scrip surging on 27 January 2006 following the announcement.



Voltas grabs attention post robust results

Voltas spurted 9.4% to Rs 732.65 on 2.14 lakh shares after reporting robust Q3 results.

The stock witnessed a pre-results' rally from the close of Rs 640.15 on 23 January 2006 to end at Rs 670.30 yesterday, ahead of its results.
Voltas jumped today after it reported a 68% spurt in net profit for Q3 ended December 2005 to Rs 11.36 crore (Rs 6.76 crore). Net sales rose 55% to Rs 447.09 crore (Rs 288.42 crore).
It has also hiked the Foreign Institutional Investors (FIIs) including their sub-accounts upto an aggregate limit of 30% of the paid-up equity share capital.
Voltas is the second-largest player in the Rs 3,000 crore air-conditioner (AC) market. The company's engineering business is reaping profit from the up-tick in the domestic economy as well as a construction boom in the Middle East.
Voltas undertakes mechanical, electrical and plumbing (MEP) projects in the overseas markets. It has a very strong presence in the Middle East and has executed projects in over 26 countries. Its core competency, in the MEP segment, is in project management and it has a proven track record of executing such projects.



Hindalco, Nalco shine on hike in aluminium price

Hindalco and National Aluminium edged higher after they hiked aluminium prices with immediate effect.

National Aluminium Company (Nalco) jumped 5.5% to Rs 290.70 on 4.4 lakh shares in the counter on BSE. Hindalco rose 1.6% to Rs 167.50 on 5.03 lakh shares.
Nalco had jumped 7.4% on Tuesday (31 January) to Rs 275.40 while Hindalco had rallied 2.7% to Rs 164.80 before the price hike announcement.
Tracking firm global prices Hindalco has raised domestic prices of aluminium by Rs 6,000 a tonne with immediate effect. Nalco has hiked prices by Rs 5,000 per tonne. On 31 January, LME aluminium price hit a 17-1/2 years high of $ 2,526 a tonne.
The world aluminium industry is facing high energy prices with many units either closing down gradually or cutting down production. As energy contributes about 50% of the total aluminium production costs, any rise in energy prices hits producers directly.
Last month, Nalco had hiked prices twice. At the beginning of the month it had hiked prices by Rs 3,500 and by Rs 2,500 in the middle of the month.
At the time of announcing Q3 December 2005 results, Hindalco said it expects domestic aluminum metal demand to grow in double digits in 2006, boosted by end-use sectors like construction, power, packaging and automobiles.



Amtek India comes out trumps on Q2 results

Amtek India jumped 4.2% to Rs 107.80 on 73,643 shares after announcing robust quarterly results.

The counter slipped from the peak of Rs 114.50 on 03 January 2006 to settle at Rs 103 on 30 January 2006, ahead of the results.
Amtek India flared higher today after it reported Q2 December 2005, net profit of Rs 18.15 crore (Rs 15.48 crore). Net sales jumped 45.30% to Rs 122.14 crore (Rs 84.04 crore).
Amtek India manufactures machined and casting components for the automobile industry. Its foundry is one of the biggest and one of the most modern foundries in India, with a capacity of 30,000 tpa. The company is a Tier-I supplier for the auto components to OEMs and has an installed capacity of 75 lakh per annum auto components. The product portfolio of the company includes products used in transmission and suspension assembly for all categories of vehicles.
It has an OEM clientele including Maruti Udyog, Kinetic Engineering, New Holland Tractors, Escorts, Carraro Transmissions, John Deere Tractors and M&M Tractors. The company also has good presence in the replacement market.
Amtek India has earlier acquired UK-based Sigma Cast Group, one of the largest suppliers of turbo-charger components for automobiles in the world. Sigma’s 100 % subsidiary, Sigma Cast Iron, is engaged in the business gray iron and spheroidal graphite iron-casting for auto and engineering industries.



'Gold rush' for L&T

Engineering & construction major L&T spurted 9% to Rs 2,373.

A stunning 4.1 lakh shares changed hands in the counter on BSE.
The stock advanced for the second day in a row. It had gained 3% on Tuesday (31 January) to Rs 2,166.75.
The stock has seen extensive buying ever since the company reported strong Q3 results coupled with a strong order-book position. From a recent low of Rs 1,866.05 on 23 January, it has spurted 27% in just 6 trading sessions to the current Rs 2,373.
L&T's strong order flows, diversification in international markets and efforts to focus on core businesses have made the stock favourite among market men. L&T has emerged as one of the key beneficiaries of a boom in industrial capital expenditure and huge investments in the infrastructure segment. The company's qualification in almost all segments of infrastructure work, coupled with the relatively bigger size of its balance-sheet, gives it an edge over other infrastructure players in the country.
L&T Q3 December 2005 net profit excluding gain on sale of glass container business & other divestments, rose 41% to Rs 187.18 crore. Revenue rose 14% to Rs 3666.36 crore.
L&T had an order-backlog of Rs 22,900 crore at end December 2005.
Last week, a consortium of L&T and Samsung Heavy Industries bagged a Rs 2,117 crore ($ 456 million) order from the Oil & Natural Gas Corporation (ONGC) for the Vasai East Development Project to be executed in a little over two years.



Dr Reddy's Lab flies on Merck pact

Dr Reddy's Lab jumped 6.7% to Rs 1,196 on reports that it had entered into a sales-agreement with US drug-maker Merck & Co.

As many as 1.5 lakh shares changed hands in the counter on BSE.
Dr Reddy's Lab (DRL) stock has surged in the past few days on the back of strong Q3 results. From a recent low of Rs 1,028.45 on 20 January, it had surged to Rs 1,119.60 by 31 January. The company has entered into an agreement with Merck &Co as per which it will sell generic versions of the US-based drug maker's Proscar and Zocor drugs, after their patents expire.
DRL's consolidated net profit as per US GAAP surged to Rs 62.80 crore in Q3 December 2005 from Rs 4 crore in Q3 December 2004. Revenue rose 25% to Rs 590 crore. Low-base effect and savings of research and development costs boosted the bottom-line.
Dr Reddy's Lab, an early Indian entrant into the US generics market, has been through a rough patch over the past three years. During this time, it has had no big drug launches to fill the hole caused when its exclusive rights to sell a version of Eli Lilly & Co's blockbuster Prozac anti-depressant ended in the financial year ending March 2002.
The company had also been bogged down by high research-and-development costs for both its generic and new drug programmes. It entered into cost-sharing deals with venture capitalists last year in a bid to reduce its burden.



Zee Telefilms hits a rought patch

Zee Telefilms plunged 4.4% to Rs 157.30 on 5.23 lakh shares after it reported dismal Q3 results.

The stock jumped 3.7% to Rs 164.55 on 8.65 lakh shares following reports that Zee has replaced Sony Entertainment Television (SET) in the second spot in the Hindi language entertainment segment.
The stock recovered from a close of Rs 139.65 on 28 October 2005 to finish at Rs 165.35 on 21 December 2005.
Media major Zee Telefilms came under selling pressure today after its lacklustre performance in Q3 FY-06. The Subhash Chandra-promoted company registered a 20.80% fall in net profit to Rs 31.70 crore for the quarter ended 31 December 2005 (Rs 38.42 crore). Total income increased 30.60% to Rs 240.16 crore (Rs 179.10 crore).
Zee Telefilms is the content supplier and space-selling agent for Zee's broadcasting entities, film-production and distribution, access and education businesses.
It is the largest vertically integrated media and entertainment company in India, beamed into more than 120 countries and reaching out to more than 30 crore viewers across the globe, in seven different languages. The company has built a valuable portfolio of television programming assets including Zee TV, Zee Cinema, Zee Music, Zee News and the regional programming portfolio. During 2005, the company has launched Zee Sports, Zee Smile and Zee Telugu, Zee Business, Zee Kashmir (a one-hour slot on Zee Punjabi). These network channels are now available on India's first Direct-to-Home (DTH) platform, Dish TV.



Patni Computer tanks after shocking results

Patni Computers Systems fell 7.3% to Rs 448 on 3.06 lakh shares after it announced poor results for Q4 December 2005.

The stock witnessed a solid pre-results rally from the close of Rs 445.40 on 18 January 2006 to finish at Rs 492.60 on 27 January 2006, expecting an excellent performance from the company.
Patni Computer Systems reported a sharp 44.22% fall in net profit for the Q4 ended December 2005 to Rs 32.87 crore (Rs 58.94 crore). Net sales, however, increased 27.20% to Rs 238.95 crore (Rs 187.97 crore).
In December 2005, the company issued 61.56 lakh American Depository shares (ADS) in a public offering, representing 1.23 crore equity shares of Rs 2 each fully paid-up at a price of $ 20.34 per ADS. PCS collected an aggregate Rs 57,39,262 from the issue. Each ADS represents two equity shares of Rs 2 each fully paid-up.
Patni Computer Systems is a leading provider of information technology services based in India . It offers services through industry-focussed practices including insurance, manufacturing, financial services, and telecommunications, and through technology-focused practices.
Patni’s service lines include application development, application maintenance and support, packaged software implementation, infrastructure management services, product engineering services, business process outsourcing and quality assurance services.



National Peroxide at dizzying heights after board meeting to consider issue of bonus issue/ sub-division of shares.

National Peroxide, an otherwise ill-liquid stock characterised by thin volumes, surged 10% (max limit) to Rs 7,747.55 after the scheduling of a board meeting to consider issue of bonus issue/ sub-division of shares.

It is also a new all-time high for the counter.

A sparse 3,057 shares changed hands in the counter today on BSE against a two-week average volume of mere 418 shares.

The stock surged from the close of Rs 5,543.05 on 28 December 2005 to close at Rs 7,043.25 yesterday.

Its latest equity capital is a tiny Rs 2.30 crore (23 lakh shares of face value Rs 100 each) while its reserves are Rs 42.07 crore. If declared, this will be the company's maiden bonus issue.

National Peroxide is jointly promoted by Bombay Dyeing & Manufacturing Company and Laporte Industries, UK. The peroxygens division of the company manufactures hydrogen peroxide and persalts. The plastic additives division produces litharge and PVC stabilisers.

Source:- www.capitalmarket.com


TCS gets HCs nod for Scheme of Amalgamation

Tata Consultancy Services Ltd (TCS) has informed that the relevant High Courts have approved the Scheme of Amalgamation of Airline Financial Services (India) Ltd (AFSL), and TCS Business Transformation Solutions Ltd (TCS BTS) and Aviation Software Development Consultancy India Ltd (ASDC) with the Company and all formalities connected therewith have been completed on February 01, 2006.Further the Company has informed that the effective date of the Scheme is February 01, 2006. The Scheme will be operative retrospectively from April 01, 2005, which is the Appointed Date under the Scheme.Since AFSL, TCS BTS and ASDC are wholly-owned subsidiaries of the Company, no shares are required to be issued by the Company upon amalgamation.




Vijith Pujari
Tuesday, February 07, 2006

Recos for Feb. 2006

*Lupin *

Cluster: Apple Green
Recommendation: Buy
Price target: Rs1,130
Current market price: Rs807
*Loop in *

Key points

- Lupin has a vast reach in the domestic formulation segment. The
company is now focusing on high growth lifestyle segments and with
aggressive new launches in FY2006 we expect the revenues from the domestic
formulations segment to increase by 33% from Rs455 crore in FY2005 to Rs608
crore in FY2006.

- The company has received approvals for eight formulation products
from the US Food and Drug Administration (USFDA). As a result of the
successful launches in the high-margin US market we expect the revenues to
increase from Rs19 crore in FY2005 to Rs165 crore in FY2006 representing a
growth of 769%.

- The boost in Lupin's regulated bulk revenues will come in FY2007 as
two drugs—Simvastatin and Pravastatin—go off patent during this year having
a market size of USD5.5 billion in the USA. Overall, we expect the
sale of bulk drugs in advanced markets to increase by 61.7% from
FY2006 to FY2007 on the back of the exports of statins.

- We expect the consolidated net sales to increase to Rs1,741 crore in
FY2007. The foray into the regulated markets and the margin improvement is
expected to boost the net profit to Rs230.6 crore in FY2007 at a
compounded annual growth rate (CAGR) of 61.8% from FY2005. At the
current market price of Rs807, Lupin is trading at 14x its FY2007 earnings
estimate. Lupin's valuation looks very cheap and attractive when compared to
its peers.

- Keeping in mind this overall growth of Lupin in all the areas like
formulations, bulk drugs and research, we initiate a BUY recommendation on
Lupin with an 18-month price target of Rs1,130.


*Cluster: Vulture's Pick
Recommendation: Buy
Price target: Rs216
Current market price: Rs144*
In the army now

*Key points

- *Defence orders: *Nelco is benefiting immensely from its past
initiatives to focus on the niche market of security and surveillance
systems for the defence forces. Given its alliances/tie-ups with leading
global majors, the company has been able to establish itself as a reliable
supplier of superior technology products. On the demand side, the government
has considerably enhanced its spending on electronic communication warfare
systems and is encouraging private participation. Consequently, the
strategic electronic business of Nelco is poised to grow at a compounded
annual growth rate (CAGR) of 40% over the next three years.

- *Robust industrial demand: *In the light of the increased
investments by the key user industries, such as steel, cement and utilities,
the company is witnessing a robust growth in its other businesses of SCADA
and power drive systems. It has built a robust order pipeline, which has
improved the growth visibility of these businesses significantly. Another
key business division of VSAT-based network systems is also growing at a
steady rate.

- *Margins to firm up: *The margins have improved significantly in the
last fiscal to double-digit levels. The operating profit margin (OPM;
excluding the real estate inflow) is likely to improve further and stabilise
around 20-22% on the back of a higher contribution from the high-margin
defence orders and service business.

- *Realty gains: *It will further unlock the value in its real estate
business by developing 50,000 square feet (sq. ft.) of saleable area in each
of the next three years. We estimate the fair value of the cash flows from
the real estate business at Rs10 per share.

- *Attractive valuations: *At the current market price of Rs144, the
stock trades at a discount of 9.9x its FY2007 estimated earnings. We
initiate coverage on Nelco with a Buy recommendation and a 12-month price
target of Rs216.


Sensex settles in a new realm above 10,000

The market's rally continued as renewed buying auto, banking and FMCG stocks took the Sensex beyond 10,000. It had hit 10,000 for the first time yesterday (6 February) but had ended just below it.

The barometer index traded above the 10,000 mark for almost the entire trading session today and also preferred to close above it for the first time in its lifetime.

Strong FII inflows and government estimates of strong GDP growth for the fiscal year through March 2006 lifted the market. Domestic funds too are lending support, sitting on a pile of cash as they are.

MTNL surged on buzz that it will secure a huge income tax refund of Rs 1,233 crore. Bharat Forge, Ashok Leyland, Voltas, Bank of India, Sail, MRF, GNFC and Balrampur Chini Mills rallied.

A huge block deal of 40.75 lakh shares was executed in Gammon India on BSE. Block deals were also executed in Indian Hotels, Corporation Bank and HEG on BSE.

Though the market breadth was weak, select side-counters surged. Stocks of Phillips Carbon Black, Videocon Appliances, Dwarikesh Sugar, Paper Products, Essar Shipping, Emami, Gulf Oil Corporation, Areva T&D, Sona Koyo Steering, IFCI, Jayshree Tea, Amar Remedies, Zandu Pharma, Indian Hume Pipe, NRC and BOC India rallied.

The 30-share BSE Sensex jumped 101.86 points (1.02%) to settle at lifetime closing high of 10,082.28. The barometer index moved 127.15 points for the day, between a low of 9,972.43 and a high of 10,099.58. The S&P CNX Nifty gained 19.65 points (0.65%), to 3,020.10.

BSE clocked a turnover of Rs 4,136 crore, higher than Monday's Rs 3,877 crore.

According to data released today, the government has forecast 8.1% GDP growth for FY-2006. The government said manufacturing was set to grow 9.4% for the year, after an 8.1% gain in the previous fiscal.

FIIs have stepped up buying on the bourses. The latest data showed that FIIs bought shares worth a net Rs 626.50 crore on Friday (3 February). In three trading sessions between 1 February and 3 February, they bought shares worth a net Rs 1,498.70 crore.

Liquidity with local mutual funds remains strong. As per reports, three new mutual fund schemes launched in January 2006 from the stable of UTI Mutual Fund, SBI Mutual Fund and Fidelity Mutual Funds collected over Rs 5,000 crore.

MTNL jumped 5% to Rs 140.75. The stock rose on a high volume of 13.3 lakh shares. MTNL will soon reap a windfall tax refund as the Income Tax department has been asked to return a whopping Rs 1,233 crore to the telecom PSU. MTNL has been fiercely defending its case in the appellate tribunal on allowing licence fee as an expense for running the business.

Auto stocks raced on expectations of strong demand due to a good monsoon this year and on the back of low interest rates. Tata Motors gained nearly 4% to Rs 763.90, tractor & utility vehicle major M&M rose 4.4% to Rs 588 and car major Maruti Udyog rose 2.8% to Rs 757.

Ashok Leyland gained 7.6% to Rs 37.80 as a massive 77 lakh shares changed hands. The company said on Tuesday its vehicle sales in January rose 6% to 5,787 units, from 5,461 a year ago. Domestic sales rose 21% to 5,618 units, from 4,655 a year earlier, while exports fell to 169 units from 806.

Bank stocks rose on strong lending growth. ICICI Bank, which focuses on retail lending, rose 2.6% to Rs 623 on high volume for the second day today as 14.4 lakh shares changed hands in the counter on BSE. HDFC Bank gained 3.8% to Rs 773, UTI Bank rose 3.3% to Rs 346, and Kotak Mahindra Bank gained 4.6% to Rs 258.

Bank of India was the star gainer among PSU banks. The stock jumped 6.4% to Rs 127.75 on 13.8 lakh shares in the counter on BSE.

Cipla rose 3.8% to Rs 514.95 continuing its upward march, ahead of its board meeting on 11 February to discuss a bonus issue.

Cigarette major ITC rose 2.3% to Rs 160.40 as a foreign brokerage put a 'buy' on the stock. An aggregate 17.4 lakh shares changed hands in the counter on BSE. FMCG giant Hindustan Lever gained 1.4% to Rs 197.10.

Index heavyweight Reliance Industries was volatile as the stock moved between positive and negative. The stock 0.1% to Rs 721.25. The stock hit a low of Rs 706.60 and a high of Rs 723.80. 24.2 lakh shares changed hands in the counter on BSE.

Cellular services major Bharti Tele-Ventures (BTL) gained 0.5% to Rs 371.50. BTL added 10.04 lakh new subscribers in January 2006, taking its user base to 1.73 crore.

A massive block deal of 40.75 lakh shares was registered in Gammon India on BSE at Rs 520 in early afternoon trade. The stock ended with down 0.3% at Rs 531.

Phillips Carbon Black spurted 20% to Rs 74.40 following reports that the company expects to end FY 2006 (year ending 31 March 2006) with a net profit despite heavy losses in Q2 September 2005 and Q3 December 2005.

Bharat Forge jumped nearly 9% to Rs 414.50. A huge 5.8 lakh shares were transacted in the counter on BSE.

Tyre major MRF jumped 8.8% to Rs 3,150. Reports suggest that truck- tyre makers are likely to hike prices in the months ahead after a surge in prices of key raw-material, natural rubber.

Aban Loyd Chiles Offshore jumped 14.9% to Rs 714. On Monday, its Singapore unit, Aban Singapore Pte bought 100% of Holland-based West Africa Drilling N.V.

Jayshree Tea and Harrisons Malayalam rose on high volume. Jayshree Tea jumped 7.6% to Rs 136.65 and Harrisons Malayalam rose 7.4% to Rs 140.90. 21 lakh shares got traded in Harrisons Malayalam and 14.4 lakh shares changed hands in Jayshree Tea. Tea shares have surged in the past two days on prospects of increase in exports from Indian companies as a sharp fall in tea production is expected in Kenya. Kenya is one of the leading tea exporters to the UK and Pakistan.

Gujarat Alkalies plunged nearly 4% to Rs 151.40 after the company denied media reports that it is eyeing a large foreign acquisition

Alstom Projects jumped 6% to Rs 294 after it bagged an export order worth $ 28.6 million.

Suzlon Energy gained 3.3% to Rs 1,100 and ABB rose 2.4% to Rs 2,450.



ABG Shipyard hits a sixer

ABG Shipyard surged 6% to Rs 364 on 4.07 lakh shares after declaring a robust order-book position of Rs 1,700 crore.

The stock has seen an upward journey ever since its listing, due to robust performance and consistent order win. From the close of Rs 271.25, it surged to end at a high of Rs 359.85 on 23 January 2006.

ABG Shipyard, is one of the country's largest shipyard companies in the private-sector. It had earlier acquired a ship repair unit at Fujairah, UAE.

The company bagged a contract for construction of two 18,000 DWT geared bulk carriers from ESL Shipping OY of Finland for $ 61.6 million (Rs 277.20 crore).

The company had also bagged a $29.7 million-contract from Cyprus-based Lamnalco for constructing three new vessels.

As per reports, ABG Shipyard is planning to buy ship repair units on key shipping routes including Singapore and China.

ABG Shipyard’s net profit for the Q3 December 2005 surged 99.7% to Rs 20.12 crore (Rs 10.07 crore). Net sales rose 42.5% to Rs 134.29 crore (Rs 94.19 crore).



Wipro allots equity shares

Wipro Ltd has informed that the Administrative Committee of the Board of Directors of the Companys vide their circular resolution effective February 06, 2006, has resolved the following:

1. To issue and allot 3640 equity shares of Rs 2/- each pursuant to exercise of the stock options by the eligible employees under the Wipro Restricted Stock Unit Plan 2004 i.e., RSU Plan 2004.

2. To issue and allot 508750 equity shares of Rs 2/- each pursuant to exercise of the stock options by the eligible employees under the Wipro Employee Stock Options Plans i.e., WESOP 99 and WESOP 2000 Plans.

3. Allotted 18300 equity shares of par value of Rs 2/- to JP Morgan Chase Bank, the Companys depository as underlying shares in respect of ADRs to be issued and allocated to the purchasers, pursuant to the exercise of the stock options granted to the employees under the Companys ADS Stock Unit Plan 2000.




Par 100 posts (V.I.P)
Fri, 24 Feb 2006

1) INOX Leisure ends higher with 49.92%
INOX Leisure, which listed today on the exchanges, ended higher. It closed at Rs 174.75 on the BSE and at Rs 179.90 on the NSE. The stock was issued at Rs 120 per share.
On the BSE, the share closed up 45.63% at Rs 174.75. It touched an intraday high of Rs 200 and an intraday low of Rs 168.05.

2) Reliance Petroleum IPO
Reliance Petroleum, the wholly owned subsidiary of Mukesh Ambani-controlled Reliance Industries, will launch its initial public offer (IPO) in the second week of April. Investment banking sources said the mega issue, which was expected to garner anything between $1.1 billion and $1.3 billion, would hit the primary market in the week beginning April 7.
They said the company had appointed six merchant bankers and the red-herring prospectus was expected to be submitted to the Securities and Exchange Board of India on Monday. Reliance Industries executives declined to comment on the issue.

3) Dynemic Products closes below issue price
Dynemic Products, which listed today on the BSE, closed lower. The share ended down 19.43% at Rs 28.20. It touched an intraday high of Rs 40 and an intraday low of Rs 27.75. It opened at Rs 37.6.The stock was issued at Rs 35. Its BSE ID is 532707.
The company engaged in the manufacturing of food colours, lake colours and blended food colours, entered the capital market on January 18 with its initial public offer to raise Rs 15.47 crore (Rs 154.7 million).


Vijith Pujari
Thursday, February 23, 2006

NSE: Record Rs 38,165 crore turnover in F&O

NSE's futures & options segment clocked a record turnover of Rs 38,165.45 crore. Wednesday's turnover stood at Rs 28,992 crore. F&O turnover often surges towards the expiry of near-month contracts due to rollover of positions to the subsequent month.

The BSE Sensex edged higher but cooled down in late-trading due to the expiry of February 2006 derivative-contracts, after the barometer index had struck a new high at above 10,300 during mid-afternoon trade.

The benchmark index rose 19.72 points (0.19%) to a new all-time closing high of 10,244.05. The S&P CNX Nifty rose 11.30 points to a lifetime closing high of 3,062.10

Weakness in some Sensex constituents in late-trading pulled the Sensex off the higher level. Stocks of Ranbaxy, Bhel, ICICI Bank and Maruti Udyog weakened in late trading.

FMCG stocks, steel shares and refinery scrips were in demand but bank scrips declined and a host of tea scrips dropped for yet another day extending their recent correction.

Stocks like Bajaj Auto, Zee Telefilms, Satyam Computer, NTPC and ONGC edged higher.

INOX Leisure settled at Rs 174.75, attracting a premium of 45.6% over the IPO price of Rs 120. A staggering 1.6 crore shares changed hands in the counter on BSE.

Select side-counters surged. Stocks of GSFC, Venky's India, TIL, Micro Inks, High Energy Batteries, Simplex Casting, JBM Auto, Bajaj Hindustan, 3M India, TRF, Jindal Stainless, Goldiam International, Ugar Sugar Works, Gateway Distriparks, Areve T&D and Amara Raja Batteries surged.

However, the market breadth was quite weak. Losers outpaced gainers by a ratio of 1.73:1. A total of 2,545 scrips changed hands in the counter on BSE.

Japanese markets led rally in Asian stocks following an overnight gains in US stocks and a drop in oil price. The Nikkei 225 average jumped nearly 2% to 16,096.10.

Meanwhile, fears of a bird flu epidemic in the country receded somewhat on reports that 94 of 95 human samples, tested negative for the H5N1 strain of virus. The last sample was being subjected to further tests to conclusively establish its status.

Bajaj Auto jumped 3.2% to Rs 2,625. A decent 2.3 lakh shares changed hands in the counter on BSE. The stock has risen sharply recently after a foreign brokerage put a 'buy' on the stock with a price target of Rs 3,000. As per reports, Bajaj Auto is considering hiving off its treasury operations into a separate company.

FMCG giant Hindustan Lever jumped 3.3% to Rs 249.50. The stock rose on a high volume of 26.3 lakh shares on BSE. The scrip had spurted in mid-February 2006 after it reported strong Q4 December 2005 results. Cigarette major ITC rose 2% to Rs 166.50.

Steel bigwigs Sail (up 7% to Rs 64.85) and Tata Steel (up 1.9% to Rs 419), extended their recent rally triggered by expectation of recovery in global steel prices. Uttam Galva Steel jumped nearly 12% to Rs 38.80 after the company said it had hiked galvanised-steel prices by Rs 2,500 per tonne.

Satyam Computer advanced nearly 2% to Rs 785. The stock is on the upmove since the beginning of this week on reports that it is expected to win some large orders.

NTPC rose 1.5% to Rs 131.50, extending Wednesday's rally on reports that the $300 million bond offer by the company had attracted over $800 million in orders so far. The debt offer is part of NTPC's newly set up $1 billion medium term note programme.

Jagran Prakashan dropped 5.5% to Rs 258.55 after RBI put restriction on fresh FII-buying in the scrip. A huge 36.3 lakh shares changed hands in the counter on BSE

Bank stocks slipped. ICICI Bank lost 1% to Rs 588, Bank of Baroda shed 1.3% to Rs 218.50, State Bank of India shed 1.1% to Rs 857, Canara Bank lost 1% to Rs 255 and Corporation Bank shed 1.5% to Rs 318.


Par 100 posts (V.I.P)
Indian Markets
Tue, 7 Mar 2006

The rally on the bourses took a breather today as investors booked profit in select blue chips and some of the front line stocks. The barometer BSE Sensex eased amid mixed trend in various constituents of the Sensex. While select Sensex constituents were steady to firm, select others eased on profit taking.

Sensex lost 31,35 points or 0.3% to settle at 10,595.43. The S&P CNX Nifty shed 3.35 points to 3,147.35.

Key Asian markets were weak today following overnight weakness in US stocks and rally in oil price. Japan's Nikkei 225 average lost 1.5% at 15,663.

Sensex slipped today after a four days pre-budget and post-budget surge. From a low 10,200.76 on 24 February 2006, Sensex had surged 426.02 points or 4.1% in four trading sessions to a lifetime closing high of 10,626.78 on 2 March 2006. The Union Budget 2006-07 helped maintain the feel good factor triggering a post-budget rally. The landmark Indo-US nuclear pact singed on Thursday further boosted the market sentiment. Continued good Indo-US relations augur well for the market at the macro level, as it would boost bilateral trade.

Tata Motors surged on the back strong sales in February. Cellular service provider Bharti Tele-Ventures (BTL) rallied boosted by a Supreme Court decision on Thursday that states should not impose sales tax on services provided by telecom companies as they could not be equated with goods.

Refiners HPCL and BPCL advanced on reports the Indian government will announce a tax package by the end of March 2006 to help loss-making refiners become profitable

Though the market breadth was weak, select stocks surged as investors' appetite for individual companies remained strong. Buying was conspicuous in construction stocks and select power equipment makers.

Among side counters, stocks like RPG Transmission, Shanthi Gears, Kalpataru Power, Nagarjuna Construction, Hindustan Zinc, GE Capital Transportation, Jyoti Structures, Ansal Housing, Voltas, Mukand, Steel Strips Wheels, Solectron Centum Electronics, Gati, Ruchi Infrastructure, Aban Loyd, Themis Medicare, Ingersoll Rand, PTC India, Century Textiles, Supreme Industries, Essel Propack, Mercator Lines, Hotel Leelaventure and Titan Industries rose between 5% to 20% for the day.

BSE clocked a turnover of Rs 4,214 crore, lower than Thursday's Rs 4,969 crore.

Among the losers of the day were L&T (down 2.7% to Rs 2,407), HDFC (down 2.7% to Rs 1,318.90), Hero Honda (down 2% to Rs 880), ICICI Bank (down 1.9% to Rs 608), ITC (down 1.6% to Rs 174) and NTPC (down 1% to Rs 130.70 ),

IT bellwether Infosys (down 1.2% to Rs 2,816) slipped for the second day in a row after a foreign brokerage downgraded the scrip.

Tata Motors jumped 4.6% to Rs 903. 17.6 lakh shares changed hands in the counter on BSE. Tata Motors said Thursday its total vehicle sales rose 22% in February to 45,114 units from 36,977 units a year earlier. Exports rose 29 percent to 4,257 units from 3,290 units. Tata Motors said sales of commercial vehicles rose 30% to 22,885 units from 17,656 units, while sales of cars and utility vehicles rose 12% to 17,972 units.

Car major Maruti Udyog gained 2% to Rs 923. The stock has spurted since the past few days. Recently, a foreign brokerage put a buy on the stock with a target price of Rs 961.

BTL rose 3.4% to Rs 409.90, a lifetime closing high. 6.04 lakh shares changed hands in the counter on BSE.

Refiners rose on reports the Indian government will announce a tax package by the end of March 2006 to help loss-making refiners become profitable. HPCL gained 2.3% to Rs 327 and BPCL rose 1% to Rs 430.

Tata Power (up 2% to Rs 546.95) which is seen benefiting from the Indo-US nuclear pact singed on Thursday rose for the second day in a row. Reliance Energy rose 2% to Rs 633.75.

Select power equipment makers rallied on expectation of strong order flow. Kalpataru Power jumped 13% to Rs 1,225, Jyoti Structures rose 10% to Rs 442, Bharat Bijlee gained 3% to Rs 983, Thermax gained 3% to Rs 1,292, Alstom Projects rose 2% to Rs 398 and Suzlon Energy rose 3% to Rs 1,175. The Finance Minster said in the budget that about 15,000 megawatt of power-generation capacity would go on stream by 31 March 2007.

Construction scrips rose buying on renewed buying on the reckoning that the government's thrust on infrastructure, power and road project will add to the already burgeoning order book of construction firms. Nagarjuna Construction jumped 11% to Rs 364.55, Ansal Housing gained 10% to Rs 228.15, IVRCL Infrastructures rose 6.7% to Rs 1,138, JMC Projects gained 5% to Rs 137.85, Punk Lloyd rose 3.6% to Rs 1,130, Jaiprakash Associates gained 3% to Rs 496, and Hindustan Construction gained 1.7% to Rs 175.95.

ACC rose 1.3% to Rs 682 on the back of strong dispatches for the month just gone by. ACC's reported 11.8% growth in cement dispatches for February 2006 to 15.34 lakh tonnes.

Tata Steel gained 1.7% to Rs 457 on the back of recovery in domestic steel prices. From early this month, steel makers hiked hot roll coils prices by about Rs 2,000 per tonne.


Par 100 posts (V.I.P)
Tue, 14 Mar 2006

Gujarat Ambuja Cements (GACL) jumped 5.6% to Rs 97.50. The stock rose on heavy volume of 33.5 lakh shares on BSE. ACC gained 2.5% to Rs 732, Grasim rose 2.2% to Rs 1,850 and UltraTech Cement gained 1.4% to Rs 589. South based cement major India Cements rose 2.5% to Rs 162.75.
Among other gainers were Birla Corporation (up 7.8% to Rs 322), Mysore Cement (up 5% to Rs 36.95), Madras Cement (up 4.4% to Rs 2,138), Chettinad Cement (up 4% to Rs 338), Shree Cement (up 2.5% to Rs 816) and JK Cement (up 2% to Rs 164.85).
Cement scrips have risen sharply in the past few days on the back of firm cement prices. The rally in cement scrips was accentuated after Union Budget 2006-07 provided thrust to infrastructure.
In most of the regions, cement prices are ruling at historic highs due to tight demand-supply scenario.
With the government's thrust on roads, ports etc. continuing, demand for cement will continue to be strong. As of now infrastructure accounts for an estimated 20% of overall cement demand.
Another favourable announcement in the budget was reduction in import duty on HDPE to 10% from 15%. HDPE is a key raw material for cement packaging bags.
Analysts feel that cement consumption will growth at a healthy 8-9% per annum. Cement demand remains strong from rural housing and infrastructure projects. Demand for cement from rural housing sector has soared following a good monsoon last year.
Cement companies reported strong dispatches for the month just gone by. ACC reported a 11.8% increase in sales at 15.34 lakh tonnes in February this year as against 13.72 lakh tonnes in February last year. Gujarat Ambuja Cement reported a 16% increase in despatches, which figured at 10.72 lakh tonnes (9.27 lakh tonnes). The Aditya Birla group's (largely Grasim and UltraTech) cement despatches for the month grew by 16.06% to 25.35 lakh tonnes


Par 100 posts (V.I.P)
Bharat Forge likely to buy Thyssen’s overseas unit

Sun, 12 Mar 2006

THE market has been abuzz for months about a jumbo deal in the auto component space. This may be it, if market sources are to be believed. The Pune-based Bharat Forge, India's largest forging company, may be close to acquiring ThyssenKrupp's forging unit in the US and Europe. Though the deal size is not known yet, the speculation is that it could be very large with the final bill probably working out to be upwards of $1.5bn. Some other sources, however, said the valuation is likely to be around $400-500m.
Bharat Forge could probably be tying up with a private equity fund for financing the buyout, but this could not be confirmed. Sources indicated that a possible announcement of the deal is likely early next week. When contacted by ET, Bharat Forge chairman Baba Kalyani said: "I do not want to comment on speculative reports."
Incidentally, there have been rumours that some other Indian component majors — Mahindra & Mahindra and Amtek — are also interested in buying the forging unit, which notched up sales of around
• 6.7bn. According to reports in a website, the entire unit is valued at anywhere between $3bn and $3.5bn. Auto analysts say that if this deal goes through, it will be another ambitious acquisition by an Indian company. There have been reports in the international press that ThyssenKrupp may sell its US automotive division.

ThyssenKrupp may use proceeds for Canada acquisition

"WE will have restructuring costs for automotive in the US again this year. In the worst case, we can't rule out selling one or two units," Ekkehard Schulz, CEO of ThyssenKrupp has been quoted as saying.
Post completion of the merger between Thyssen AG and Krupp AG in 1999, ThyssenKrupp has been selling some of its divisions to focus on steel, auto parts and elevators.
The selloff of the forging unit is likely to help finance ThyssenKrupp's planned acquisition of Canada's Dofasco from Mittal Steel, which is likely to cost the buyer $4.8bn. Mittal, it must be remembered, is bidding for Arcelor SA.
This deal is in line with Bharat Forge's philosophy of inorganic growth. They have been looking for inorganic growth for the past one year, like the JV in China and acquisitions in Sweden.


Par 100 posts (V.I.P)
Tue, 11 Apr 2006
Cement scrips edged higher extending their recent solid surge on firm cement
prices and strong demand.

ACC jumped 4% to Rs 926, Gujarat Ambuja Cements (GACL) rose 3% to Rs 111 and
Grasim gained 1.6% to Rs 2,235. In the past three trading sessions, ACC has
gained 16.3% from Rs 795.95 on 4 April 2006. Grasim has witnessed a
sustained upmove since late December 2005. The upmove in GACL began in late
March 2006 after a correction during mid-March 2006.

`With the double-digit volume growth and a strong 10% plus improvement in
realisations will drive robust performance at the Ebitda (earnings before
interest, tax, depreciation and amortisation) level. However, the earnings
growth will be muted due to the high base effect. The companies had booked
the benefits of deferred tax write backs during Q4 FY 2005,' a foreign
brokerage notes in a latest observation on the cement sector. ACC kickstarts
the earnings reporting season on 12 April 2006.

The booming housing and infrastructure sectors have driven a strong growth
in cement dement in the past few months. The higher real estate prices are
driving a construction boom. Improved volumes, coupled with the rising
prices, have resulted in improved margins for cement firms.

For Gujarat Ambuja, cement dispatches in the month were at 13.29 lakh tonne,
up from 11.79 lakh tonne in the same period last year. ACC, on the other
hand, saw 17.46 lakh tonne of dispatches against 15.72 lakh tonne for the
same period last year. ACC has witnessed highest production and dispatches
ever for March. Aditya Birla Group saw a 10.87% increase in cement
dispatches to 28.6 lakh tonne in March over the last year.

Overall supply of cement is also being dented by the increase in cement
exports, which increased 32% to 5.4 MMT in the April-February '06 period.


Par 100 posts (V.I.P)
Tue, 11 Apr 2006

Satyam Computer rose nearly 3% to Rs 839.35 after the company said it will consider a bonus issue along with Q4 results on 21 April 2006.

The stock had slipped into negative territory by early afternoon trade and had hit a low of Rs 805.40 compared with Friday's closing price of Rs 816.55 before the announcement hit the market. It bounced back soon after the announcement.
As many as 15.4 lakh shares changed hands in the counter on BSE.
After rallying during late March 2006 and early April 2006, the stock had cooled off. From a recent peak of Rs 882.30 on 3 April 2006, the stock retreated to Rs 816.55 by 7 April 2006 ahead of the announcement.
Earlier, in mid-March 2006, foreign fund has raised its holding to 5.03% through acquisition of additional 5,85,136 shares from the market.
Satyam becomes the second IT major after Infosys to consider a bonus issue this year.
Satyam's current book value per share is Rs 99.20 (as on 31 March 2005) on face value of Rs 2. The last time the company issued a bonus was in 1999. It was a liberal 1:1 bonus at that time.
In late March 2006, Satyam won a five-year offshoring contract from Nissan North America to maintain, support and enhance software applications of the automotive major. The $80-billion Nissan was the second major automobile client that the Hyderabad-based consulting and information technology company had won in the three months. In January, Satyam had bagged a $150-million (Rs 650 crore) five-year deal from General Motors through a partnership with Tier-I vendors Hewlett Packard and Capgemini.
For FY 2006 (year ending 31 March 2006), Satyam Computer expects between 37-38% growth in EPS to between Rs 30.31-30.36, over fiscal 2005 EPS of Rs 22. The company expects income from software services to grow between 35.7-35.9%, in the range of Rs 4,780-4,786 crore, over the fiscal 2005 income of Rs 3,521 crore.


New member
hi all
can anyone give me some light on ITC for 15 days time period. thinking of buying a call option of strike price 200.
what do you say ppl



Par 100 posts (V.I.P)
IBCX Merger news out

IBAC Corporation Board of Directors Approve Several Issues at a Meeting Held on Sunday 12/17/06
Dec 18, 2006 1:54:00 PM
Copyright Business Wire 2006
IBAC Corporation (Pink Sheets:IBCX) , a Hospitality Holding Company , yesterday Sunday 12/17/06 announced that its Board of Directors has approved unanimously to spin/sell off its restaurants and food service businesses to another publicly traded company, the Board at the same meeting also approved that the remainder of IBAC Corporation' s assets and company will move to the OTCBB via a merger with an existing fully reporting OTCBB fully trading shell company.
The first action that was approved was the spin/sell off of the company's restaurants and its holdings in its food service businesses, the value of the transaction is expected to be a minimum of $4,500,000 or as high as $5,000,000 dollars with a dividend to be paid to common shareholders in the form of either cash/stock or both. The dividend will be paid to shareholders only and exclude all officers and directors of the company. The company expects the transaction to be ready to close within Thirty (30) days, at that time the company will announce the payment/dividend structure and provide the name and symbol of the new company.
The second action that was approved was the merger of IBAC Corporation and the remaining real estate owned assets and future acquisitions into a fully reporting and trading OTCBB company, the surviving entity will include all of IBAC's real estate holdings and will maintain the IBAC name and share structure. The shareholders will receive equal value in the transaction of shares of the merger.
Edward W. Hayter the CEO of IBAC and the largest shareholder in the company "said that this plan to maximize the company's asset and shareholder value going forward is the best course of action, I believe that the spinning off of non real estate owned properties and recovering as much cash as possible to reinvest in real estate owned property's and moving the company to the OTCBB are the best way to maximize shareholder value."
This press release does not constitute an offer of any securities for sale. This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements involve certain risks and uncertainties that could cause actual results to differ, including, without limitation, the company's limited operating history and history of losses, the inability to successfully obtain further funding, the inability to raise capital on terms acceptable to the company, the inability to compete effectively in the marketplace, the inability to complete the proposed acquisition and such other risks that could cause the actual results to differ materially from those contained in the company's projections or forward-looking statements. All forward-looking statements in this press release are based on information available to the company as of the date hereof, and the company undertakes no obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this press release.
Source: IBAC Corporation

------------ --------- --------- --------- ------- IBAC Corporation Investor Relations 718-891-8188 Fax: 775-320-5437 [email protected] com www.ibaccorp. com


MP Guru
No more curbs on capital inflows: FM

Finance Minister P Chidambaram on Thursday told global investors that no further measures were in the offing to curb capital inflows, even as he said India would ease procedures for foreign institutional investors (FIIs) to register and do business in the country.

"I would urge Sebi (Securities and Exchange Board of India) to meet potential FIIs to explore ways and means to make registration even simpler," he said at an ICICI Securities global investors' meet in New York.

Chidambaram, who took questions after his speech, was repeatedly asked to clarify the intent behind the market regulator's recent proposal to curb participatory notes (P-notes), an offshore derivative instrument used by overseas investors who buy shares anonymously.

"Foreign investors are liquidating their holdings of securities in their countries and putting that money elsewhere. It has therefore become necessary to take some measures to moderate the flow of funds into India. We have no intention of imposing control on capital flows, nor do we intend to keep out certain kinds of funds," he added.

Chidambaram also attributed the sharp fall in the Sensex today to "motivated rumours". "In the morning session, the market gained 400 points; in the afternoon, there were motivated rumours in the Bombay brokers' circle," he said.

He added that Sebi had reserved the right to extend the 18-month deadline, during which time FIIs can roll over derivate exposures through P-notes.

Chidambaram also made it clear that the rupee was not in the "comfort zone" and India was facing an "entirely new situation" in this regard. The Indian currency has appreciated nearly 12 per cent in this financial year.