13 August 2008

GENERAL

1)India and Britain on Tuesday agreed to undertake a joint study on ways to remove non-tariff barriers in bilateral trade following talks between Finance Minister P.Chidambaram and the Chancellor of  the Exchequer, Alistair Darling in London as part of the ministerial- level India-U.K. Economic and Financial Dialogue.

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ECONOMY

2)INDUSTRIAL production grew 5.4% in June 2008, higher than 4.1% (revised) growth in May 2008, but well below the 8.9% growth in June, 2007. Industry’s slower pace has intensified apprehensions that the economy’s growth rate could slip below 8% in the current fiscal, and raises the importance of a good monsoon this year.

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CORPORATE / INDUSTRY
 
3)German pharmaceutical major Fresenius Kabi, which had recently acquired Dabur Pharma, is planning to invest up to e30 million in  the next 2-3 years in the Indian company. The investments will go primarily into doubling production capacity of Dabur Pharma’s active pharmaceutical ingredients(API) manufacturing facility in Kolkata.

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4)Larsen and Toubro-led consortium has bagged orders totalling Rs 3,816 crore from customers in the metal industry. L&T in association with Outotec, GmbH of Germany, and Paul Wurth bagged orders  totalling Rs 2,545 crore from Tata Steel for a 6 million tpa(tonnes per annum) pellet plant and a blast furnace at Jamshedpur.

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MONEY & BANKING

5)The rupee depreciated by about 20 paise on Tuesday as the dollar strengthened against other major currencies in the global markets. The currency opened at 42.18/20 and weakened to touch an intra-day low 42.44/45. It partially recovered to close at 42.37/38, against the previous close of 42.16/17.

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6)Union Bank of India, the fifth largest public sector bank, on Tuesday launched two services. These services, which are expected to enable faster transfer of funds, are Online National Electronic Fund Transfer(NEFT) and Quick Collection of Cheques(QCC).

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7)ABN Amro, India which will be soon rechristened as Royal Bank of Scotland (RBS) is actively considering an acquisition in India in  a bid to expand its footprint in the country. Meera Sanyal, country executive, ABN Amro India said, “We have decided to acquire a bank in India only after March 2009 and are waiting for the regulatory re- gime to become more conducive to do so. Altough we have not yet identified a potential bank for the proposed takeover, such a buyout is very much on our agenda.”

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INSURANCE
 
8)AEGON Religare Life Insurance began its operations in Mumbai on Tuesday with the launch of four products and two riders. They are level term plan, protect gain plan, star child plan and premium gain plan. The company CEO, Rajiv Jamkhedhar, told the media on the occasion that his company will be having an initial capital of Rs 370 crore and all the branches of his company were looking at break-even in three years.

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MARKETS

9)Even though the Index of Industrial Production(IIP) numbers were in line with expectation, key Indian equity indices succumbed to profit- booking and snapped its five-day winning streak on Tuesday. Tracking positive cues from the global markets, Indian markets opened in higher but profit booking coupled with weak cues from the European markets dragged the indices into the red. The 30-share Sensex of BSE, after opening with a slight positive bias, traded in the negative for the  entire trading session to end at 15,212.13 points, posting a loss of 291.79 points, or 1.88% on Tuesday. The wider S&P CNX Nifty of National Stock Exchange(NSE) closed at 4,552.25 points, losing 68.15 points, or 1.47%.

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10)TRENT, the Tata Group’s retail arm, jumped 10 per cent today to close at Rs 545.85 after Tesco, the UK’s biggest supermarket chain, chose its subsidiary, Trent Hypermarket,as its exclusive partner for a chain of wholesale stores in India.

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11)Biotech major BIOCON today surged 5.18 per cent to close at Rs 403.05 after the company fixed September 12 as the record date for issue of bonus shares in the ratio of 1:1. After opening the day flat of Rs 382, the stock touched an intraday high of Rs 405.50 and  a low of Rs 379.05.

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12)NSE will add 39 stocks to its existing list of futures and options contracts from August 21. Stocks added to the list are Akruti City, ABG Shipyard, Asian Paints, Balaji Telefilms, Container Corporation, Core Projects, Deccan Chronicle, Dish TV, Everonn Systems, First source Solutions, GSPL, GTL Infra, GVK Power & Infra, HCL Infosystems, Indiabulls Real Estate, KLG Systel, KS Oil, MIC Electronics, Mindtree, Mercator Lines, Monnet Ispat, MRF, Nava Bharat Ventures, Noida Toll Bridge, Opto Circuits, Orbit Corporation, Prism Cement, PTC India, Reliance Infrastructure, Sintex Industries, Srei Infra, Thermax, Tor- rent Power, TV-18 India, UCO, UTV Soft, Voltamp Transformers  and Walchandnagar Industries.
 
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13)National stock Exchange(NSE) has received in principle approval  from the regulators for starting trading in the Exchange Traded Currency Futures, according to informed sources in the markets. The NSE performed road shows in major metros and received good response from both banks and the broking community, they added.

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IPO

14)Avesthagen’s initial public offering plan, of at least two years, appears to be on track. The biotechnology company has said it proposes to file a draft red herring prospectus with the Sebi – and that it likely in the near future.

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MUTUAL FUNDS

15)After a breather, domestic mutual funds are back in market to tap investors’ appetite by floating new equity fund offers with various portfolio strategies. Persistent weakness in share market led to a  slowdown in new equity plan offers since April. However, with signs of some positive trend in July, these schemes have made a gradual comeback. Five fund houses – JP Morgan Mutual, JM Financial Mutual, ICICI Prudential Mutual, Sahara Mutual and Escorts Mutual – have  floated equity-oriented funds.

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16)In one of the most innovative product launches globally, domestic fund houses are gearing up to roll out funds that will invest in  frontier markets. Distressed by the falling spree of Indian equities, fund managers are looking at various avenues of diversification. At a time when emerging markets, including India, are vulnerable to global cues and are more coupled, frontier markets show less or almost no correlation. Franklin Templeton was the first to spot an opportunity and has already filed for a MENA fund(Middle East North Africa Fund), which will invest in some of the frontier markets. Morgan Stanley Mutual Fund is also firming up plans for a  fund based on frontier markets. Frontier markets includes countries such as United Arab Emirates, Qatar, Bahrain, Egypt, Jordan and  Morocco among others. They are described as smallest, less developed less liquid countries that make up a chunk of emerging markets. According to a Merrill Lynch report on Frontier markets. “Frontier mar-kets appear to be less volatile than other equity markets. They have strong external balances and economic growth, particularly in Asia and the Gulf.”
 
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COMMODITIES

17)Gold prices plummeted to 8-month low on Tuesday as the dollar’s rally triggered a massive sell-off, hitting oil and industrial metals as well. Spot gold touched $801.90 an ounce, its lowest level since late December, and was at $810.60/811.60 at 1016 GMT compared with $819.25/820.85 late in New York on Monday. The precious metal is down more than 20 per cent since hitting a record high of $1,030.80 on March 17.

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18)Pepper futures market on Tuesday moved up on speculative activities by the bulls. August contract increased by Rs 89 a quintal while the rise in other contracts was from Rs 43 to Rs 102 a quintal from the closing price of Monday.

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19)Gold and silver prices plunged further on panic-selling by stockists owing to distinctly weak global cues. The yellow metal ended at a 3- month low and the white metal at a 7-month low. Standard gold(99.5 purity) crashed by Rs 515 per ten gm to end at Rs 11,300, the level not seen since May 2, 2008, from Rs 11,815. Pure gold (99.9 purity) also collapsed by same margins to Rs 11,365 from Rs 11,880. Silver ready(.999 fineness) too, plummeted by Rs 995 per kg to Rs 21,445, the level not seen since February 8,2008, from Rs 22,440.

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REAL ESTATE
 
20)Kachiguda is one of the oldest localities in twin cities. Being a middle-class area, the locality is dotted with lanes that houses small residential complexes. The area houses Kachiguda Railway Station and it is also near to one of the main bus stations in the Hyderabad city. The area is also known for Badi Chowdi, an old shopping destination for clothes, jewellery and vegetables. Besides, Kachiguda may soon witness the opening of a multiplex with one of the best-known theatres Maheshwari-Parameshwari getting a makeover. It is also home to many music schools and Badruka College of Commerce is located there. Estimates by Jones Lang LaSalle Meghraj(JLLM) suggest that the capital value of commercial property including retail and office in the region ranges from Rs 4,200-7,500 per sq ft depending on the floor. While the second to fourth floor space is quoted at Rs 4,200 first floor space is quoted at Rs 6,000 and ground floor is around Rs 7,500. The rental value of commercial space also ranges from Rs 36-65 per squre feet. The capital value for residential property in the area is around Rs 2,800-3,000 per sq ft.

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COMMUNICATIONS

21)The country’s largest mobile operator Bharti Airtel is set to become the country’s largest telecom operator (both fixed line and mobile), beating the state-owned BSNL in a month’s time. BSNL, which is today the largest telecom operator, has a total subscriber base of 73 million in June compared to Bharti’s 71.7 million. Given the average growth of the previous months, Bharti should be well ahead of BSNL by a margin of one million subscribers within a month’s time.

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BUSINESS PROCESS OUTSOURCING
 
22)The Hinduja Group-promoted business process outsourcing (BPO) firm HTMT Global Solutions has set aside Rs 400 crore to close two acquisition deals in the US by the end of this year. Both US companies, with a headcount of 4,000 plus each, offer services in the finance and accounting(F&A) and remote infrastructure management (RIM)  space in US and Canada.

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23)GREATER Pacific Capital (GPC), a London-based strategic investment firm, will acquire 38% stake in Ahmedabad-based BPO Azure Knowledge Corporation for a consideration of $32.5 million, the company said on Tuesday. GPC will instantly subscribe to around 26.4% share-holding for $10 million in the first phase, while the balance will be invested in fiscal 2010 based on Azure’s performance evaluation.

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INFORMATION TECHNOLOGY

24)BANKING software major i-flex has bagged a deal valued at $90 million from National Australia Bank(NAB), one of its largest wins ever and a first for its main banking solution in the Antipodean nation. The five-year contract is part of a larger deal awarded to Oracle, which owns a majority stake in i-flex.

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INTERNATIONAL

25)CRUDE prices slid further on Tuesday, even as Russia attacked a key strategic oil pipeline in its battle with Georgia and the International Energy Agency forecast a steep drop in energy demand. The  IEA, publishing its monthly report, painted a global picture of  sharply falling demand for oil because of high prices and economic slowdown, and a cutin the use of cars and increased crude production. Oil prices fell as the dollar hit a six-month peak against the euro, traders said. A stronger dollar tends to dampen demand for dollar- denominated commodities as they become more expensive for buyers  holding weaker currencies. London’s Brent North Sea crude for September delivery lost $1.56 to $111.11 per barrel on Tuesday. New York’s  main contract, light sweet crude for September delivery sank $1.35 to $113.10.

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FOR MORE INFORMATION, PLEASE BROWSE THROUGH THE FOLLOWING SITES.

Karvy Consultants Ltd www.karvy.com
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 www.indiacorporateadvisor.com
 www.karvycomtrade.com (Commodities)
KARVY Global Services Ltd www.KARVYGlobal.com
KARVY Realty (India) Limited www.karvyrealty.com
Economic Times www.economictimes.com
The Financial Express www.financialexpress.com
Business Line www.businessline.in
Business Standard www.business-standard.com
The Times of India www.timesofindia.com
The Hindu www.hindu.com
Deccan Chronicle www.deccan.com
The New Indian Express www.newindpress.com