Friday, January 28, 2011

28- Jan-2011

ONGC finds maiden shale gas reserves in India

ONGC has struck natural gas reserves in its maiden well drilled to tap shale gas in West Bengal. The breakthrough is significant as India is the first Asian country where gas was discovered from shale. The estimated expenditure is about Rs 168 crore and the total project is expected to be completed within 520 days. (Source: Business Standard)

NTPC, NPCIL form JV for nuclear power projects.

A joint venture company between NTPC and Nuclear Power Corporation of India (NPCIL), Anushakti Vidhyut Nigam, has been incorporated for developing atomic power projects in the country. NPCIL shall hold 51%and NTPC shall hold the balance 49% of the equity. NTPC has set a target of generating 2,000 Mw of nuclear power by 2020. (Source: Business Standard)

Dr Reddy's sees impact from GSK deal in 2-3 yrs

Dr Reddy's Laboratories will start to see the benefits from its tie-up with Britain's GlaxoSmithKline in two or three years. GSK signed a deal with Dr Reddy's in 2009 giving it access to the Indian firm's portfolio and its future pipeline of more than 100 branded generic pharmaceuticals. (Source: Economic Times)

Marico to hike prices by up to 9%; to invest Rs 60 cr in FY'12

Marico will increase the prices of its products by up to 9 % in a bid to offset high input costs. The company is also planning to invest about Rs 60 crore during 2011-12 financial year in its capital assets. (Source: Economic Times)

Cipla promoters in sale talks with global firms

The promoters of Cipla are in negotiations to sell their stake to a global buyer. Cipla with over 5% market share makes a good fit for any company looking for a sweet spot in the Indian Pharma market. The promoter stake in the company is likely to be valued around 8,000 crore. (Source: Economic Times)

Thursday, January 27, 2011

27-Jan-2011

HCL Tech gets one-third revenue from Europe

HCL Technologies is bullish on the Europe, aiming to get one-third of its revenue from the region."The Europeans are finding that their costs structures are not competitive. This is first-time that the Europeans are opening to outsourcing," Vice-Chairman and CEO Vineet Nayar, said on the sidelines of the World Economic Forum annual meeting. (Source: Bussiness Standard)

BOI eyes Rs 90k-cr business in Gujarat by 2015

Bank of India (BOI) has entered into an agreement with the state government to lend Rs 12,000 crore to various customers groups in the state. It will also open 22 new branches in the state by the end of current fiscal. (Source: Economic Times)

Ultratech to invest Rs 10,000 cr in 3 yrs

Ultratech Cement will invest around Rs 10,000 crore over the next 3 years to enhance its annual capacity by 9.2 million tonnes, expecting up to 10growth in demand. It has an annual capacity of 52 million tonnes. (Source: Business Standard)

RVL, IL&FS in pact for Jhajjar

Reliance Ventures Limited (RVL), and Infrastructure Leasing and Financial Services Limited (IL&FS) have entered into an agreement to develop a model economic township and other infrastructure facilities at Jhajjar in Haryana. (Source: Economic Times)

27-Jan-2011

SAIL to set up a 3 million tonne steel plant in Indonesia

SAIL will set up a 3 Mtpa in Indonesia, entailing a likely investment of up to Rs 15,000 crore, according to sources. It has already inked a pact with Indonesian govt. on January 25 for setting up a steel plant and a mineral processing unit besides development of mineral deposits. (Source: Business Standard)

Sesa Goa secures stay order against Bellary sell-off

Sesa Goa has secured a stay order from the Delhi High Court against the decision taken by IFCI on Bellary Steel sell-off in which JSW Steel was declared the highest bidder. Last month, a consortium of lenders led by IFCI had declared JSW Steel as the highest bidder for acquiring the assets of Bellary Steel and Alloys. (Source: Business Standard)

ICICI Bank to open 500 branches every year

ICICI Bank will add 400-500 branches annually over the next three years and focus on financing infrastructure projects in road and power. Presently, it has about 2,500 branches and 5,800 ATMs. Though the bank did not open any new branch in the current financial year, it acquired Bank of Rajasthan that itself meant addition of 500 branches. (Source: Economic Times)

Maruti crosses one million sales mark in 10 months of FY-2011

Maruti Suzuki India became the first company in India to sell one million units in a single year last fiscal, has already crossed the milestone in just ten months this financial year. During the April-December this fiscal the company sold a total of 9, 27,655 units, which includes both domestic sales and exports. (Source: Economic Times)

Praj Industries aims to grow non-core business fivefold in two years

Praj Industries is looking to increase the share of its non-ethanol businesses in its top line from the current 5% to 25% in two years. The company last fiscal decided to diversify into newer areas like water & wastewater management, customized equipment for oil & gas and other industries, and bio-nutrients to derisk operations in the ethanol business. (Source: DNA Money)

Tuesday, January 25, 2011

26-Jan-20011

Larsen & Toubro and Kobe Steel enters into a JV

L&T and Kobe Steel, Japan have entered into a JV for manufacture of internal mixers and twin screw roller head extruders for the tyre & rubber industry for global markets, including India. The JV will invest around Rs 60 crore for setting up of a manufacturing facility and related infrastructure. (Source: Capital Line)

Bharti Airtel to launch 3G services within a week

Bharti Airtel will commercially launch 3G mobile services within a week. Bharti had won spectrum (radio waves) for 3G services in 13 of the country's 22 telecom service areas in the auction held by the Government last year. (Source: Business Standard)

ONGC FPO likely to hit market on March 15

The Rs 13,000 crore public offering of ONGC is likely to hit the market on March 15. A tentative schedule has been drawn for the FPO and the public offer will hit the market on March 15. ONGC will file the red herring prospectus for the FPO by February 25. (Source: Business Standard)

Credit Policy Update

The RBI's rate action today was in line with market expectations. Considering inflation being a key concern once can expect another 50bps hike by Dec11. The key take-away was RBI's guidance for the coming fiscal - in terms of growth (where it expects a moderation), inflation (further upside risks on a/c of food and commodities) and liquidity (where-in the structural factors could dominate).

IMPORTANT TAKE-AWAYS FROM THE POLICY

Repo/Reverse Repo Rates raised by 25bps — Time for catch-up as RBI has been behind the curve....In line with expectations, the RBI in its policy today raised its key policy rates by 25bps. The repo (liquidity injection rate) now stands at 6.50%, and the reverse repo (liquidity absorption rate) at 5.50%. Going forward, RBI could raise rates further by another 50bps in 2011.

Guidance – Growth, Inflation and Liquidity — Not a Great Picture......

1. Growth: The RBI has retained its 8.5% GDP estimate for FY11 with an upward bias; however it is cautious on the outlook for FY12 saying that "growth may decline somewhat" due to agriculture reverting to its trend.

2. Inflation: The RBI has raised its Mar11 estimate of inflation from 5.5% to 7%. While it expects headline inflation to moderate in future, it has warned that "several upside risks are already visible" due to global and domestic factors.

3. Liquidity: The RBI has distinguished between frictional and structural liquidity. While frictional liquidity is likely to ease with govt spending, structural liquidity shortages could persist due to the divergence between credit and deposit trends. In the interim, it has extended its liquidity measures until April.

Inflation – Much more than monetory policy needed.....The RBI said that in the growth/inflation dynamics, the balance of risk has tilted towards ‘intensification of inflation’. However, RBI admitted that given the underlying dynamics, the role of monetary policy is ‘confined to containment and prevention of food and energy prices’ from becoming generalized. To this end it has re-iterated that food price scenario is primarily a reflection of structural constraints…and thus ‘unless meaningful output enhancing measures are taken, inflation could become entrenched and threaten the growth momentum’.

Market Impact – With the rate hike in line with market expectations, yields have remained unchanged with the 10-year bond trading at ~8.17% levels.

Investors can take advantage of existing good yields by parking money in ultra short term, short term bond fund and fixed maturity plans.

Best Regards,

25-Jan-2011

Sun Pharma plans its biggest buy in US

Sun Pharmaceutical is planning its biggest acquisition in the US to boost sales in the world’s largest pharmaceutical market. The buyout will help in expanding Sun’s capacity to sell generic medicines and enable company to gain control of manufacturing sites and sales networks. (Source: Business Standard)

Deccan Chronicle to merge Deccan Chargers, Odyssey with self

Deccan Chronicle will merge its wholly-owned subsidiaries IPL team Deccan Chargers and retail store chain Odyssey India with itself. The appointed date of the amalgamation is April 1, 2010, and is subject to the approval from the High Court of Andhra Pradesh. Since the transferor companies are wholly-owned subsidiaries, no fresh shares will be issued by Deccan Chronicle Holdings upon coming into effect of the scheme. (Source: Business Standard)

Asian Paints to form second joint venture with PPG Industries

Asian Paints will form a second new JV with US-based PPG Industries, besides expanding their existing JV in order to accelerate growth of non-decorative coatings business in India. As per the plan, Asian paints Limited (APL) and PPG will establish a second 50:50 JV. The second JV will service the protective, industrial powder, industrial containers and light industrial coatings markets. (Source: Business Standard)

Bajaj Auto to add 130 new dealers by June

Bajaj will add 130 new dealerships by June that will create about 7,000 new jobs. These new dealerships will commence temporary operations by March-end, with final operations commencing by June. (Source: Business Standard)

Godrej to double fatty acid capacity at Gujarat plant

Godrej Industries will double the production capacity for fatty acids from its plant at Valia in Gujarat, which will entail an investment of Rs 50 crore over the next 18 months. With the expansion, the fatty acid production capacity will be doubled at the plant. (Source: Business Standard)

Tuesday, January 18, 2011

Morning Bell 19-Jan-11

Tata Steel to invest up to Rs 3,000 cr in Europe ops

Tata Steel will double its investments on European operations to Rs 2,900-3,000 crore annually in the next couple of years to increase productivity. The investments are mainly for improving productivity and for various other initiatives being targeted in Tata Steel Europe. (Source: Business Standard)

Petronet in 2-yr deal to buy 1.1 mln T LNG/yr

Petronet LNG has signed deals to source 1.1 million tonnes of liquefied natural gas annually for the next two financial years. It is sourcing LNG from various suppliers in small quantities. These volumes are on top of 7.5 million tonne per year LNG that it gets from RasGas. (Source: Economic Times)

Gail to raise Rs 3,500 cr, to invest Rs 35kcr in 4 yrs

Gail plans to raise Rs 3,500 crore from market as part of its Rs 7,000-crore capital expenditure plan in the next financial year. Gail plans to add 1,500 km pipelines by next year that would raise its gas transmission capacity to 230 million standard cubic meters per day (mmscmd) from current 180 mmscmd. The company is raising $150 million through external commercial borrowings (ECB) next month and applied for a loan of Rs 300 crore from Oil Industry Development Board (OIDB). (Source: Economic Times)

Surya Roshni to expand product range

Surya Roshni has decided to expand its product portfolio due to rise in global and domestic demand. It is gradually adding section pipe (square/rectangle) with full size and ranges in its product portfolio. Surya Group, having a present turnover of Rs 2500 crore, is projected to double it in next two years. (Source: Business Standard)

Reliance Communications raises $255 mn to partly refinance 3G spectrum fee

RCom has raised $255 million through external commercial borrowing (ECB) from consortium of banks to partly refinance the amount paid for 3G spectrum in the auction last year. The loan is funded by a consortium of banks led by Australian and New Zealand Banking Group, BNP Paribas, Credit Agricole Corporate and Investment Bank, DBS Bank Ltd and Intesa Sanpaolo Spa. (Source: Business Standard)

18 Jan 2011

Infosys to appeal tax demand on onshore work

Infosys Technologies will appeal an income tax department order demanding it to pay Rs 457 crore in tax for work done onshore. The tax demand is based on the assessment year 2007-08. (Source: Business Standard)

GAIL scouts for US shale gas assets

GAIL is scouting for shale gas assets in the United States and is willing to invest around $400-$500 million. GAIL is likely to look at an asset that was already in production and would be open to either investing in an asset or picking up equity in specific firms. (Source: Business Standard)

Hindustan Construction Co. down on Environmental Ministry report against Lavasa

The shares of HCC were trading down 5 % on report environment ministry finds violations at Lavasa. A committee set up by the ministry of environment of forests has confirmed 'environmental violations' by Lavasa Corp, a unit of HCC. (Source: Business Standard)

Tata Steel to start construction on Orissa steel plant by month-end

Tata Steel will start the construction on its much delayed Orissa steel plant by the month-end. It has completed the ground levelling at the plant site and is hoping to kick off construction work of the six million tonne per annum (mtpa) plant by January end. (Source: DNA India