Headlines (06 September 2008)

GENERAL

1)As it awaited the Nuclear Supplier Group’s (NSG) decision on a waiver, India on Friday pointed at the possibility of occupying the high table of suppliers some day. The point was made by an indirect reference to India’s large reserves of thorium, an ore that can replace uranium as fuel for nuclear reactors. The reference was tucked into the statement External Affairs Minister Pranab Mukherjee issued in Delhi while the NSG was meeting in Vienna, debating whether restrictions on the sale of nuclear fuel and equipment for India should be lifted.

Indian Express

CORPORATE / INDUSTRY

2)The Petroleum Minister, Mr Murli Deora, on Friday said that he hoped that the acquisition of the London Stock Exchange-listed Imperial Energy Corp Plc by ONGC Videsh Ltd(OVL), the overseas investment arm of ONGC, will be concluded in 4-5 weeks.

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3)BEML has received a Rs 31-crore development contract from the Indian Rail Board to design and develop the country’s first stainless steel AC EMU coaches. A BEML release said the contract covers design, manufacture, supply, testing and commissioning of two rakes or 18 units SS EMU coaches over the next two years.

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MONEY & BANKING

4)The rupee depreciated by 30 paise on Friday against the greenback due to sustained demand for the dollar. The currency opened lower at 44.58, but strengthened to touch an intra-day high of 44.28. How- ever, it then weakened to touch an intra-day low of 44.73, a level not seen since December 2006. It recovered partially to close at 44.65, against the previous close of 44.35/36.

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INSURANCE

5)The private sector life insurer, Birla Sun Life Insurance(BSLI), has launched its latest product Birla Sun Life Insurance Freedom 58 Retirement Solutions. It is a simple hassle free retirement product with flexible investment option to enable a secure future for its policyholders.

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MARKETS

6)Key Indian equity indices declined for the second straight trading session on Friday. Taking a cue from the weak US and Asian mar- kets, the 30-share Sensex of Bombay Stock Exchange(BSE) plum- meted 415.27 points, or 2.79%, to close at 14.483.83 points. The broader S&P CNX Nifty of National Stock Exchange(NSE) lost 95.45 points, or 2.15%, to end at 4,352.30 points. Dealers said intense selling by foreign institutional investors(FII) in the past two sessions portends trouble for the Indian markets.

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7)Oil marketing companies saw their stocks rise through the week as crude oil prices weakened. Over the week, these stocks have gone up by between 11 per cent and 18 per cent. BPCL rose 18 per cent, HPCL gained 17.72 per cent and Indian Oil Corporation went up by 11.25 per cent.

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8)The Securities Appellate Tribunal(SAT) on Friday allowed Bangalore based Sasken Communication Technologies Ltd to proceed with buyback of shares worth Rs 40 crore. The buyback had been pending the permission of capital market Securities and Exchange Board of India(Sebi).

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RIGHTS ISSUE

9)Tata Motors today said it has fixed September 16 as the record date for determining shareholders entitled for the Rs 4,147-crore rights issue, the company said in a filing to the Bombay Stock Exchange. Tata Motors would allot shares in the ratio of one piece for every six equity shares of Rs 10 each held in the company.

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MUTUAL FUNDS

10)DBS Chola Mutual Fund announced the launch of its close-ended fund, DBS Chola Fixed Maturity Plan Series 10 – Quarterly Plan II(91 days) on Friday. The fund seeks to generate regular returns and capital appreciation by investing in debt, corporate bonds, government and money market securities maturing in line with the time profile of the respective plans. The benchmark for the fund will be Crisil Liquid Fund Index.

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MERGER & ACQUISITION

11)Merger and acquisition(M&A) activities India are expected to slow down in FY09 owing to lack of financing due to liquidity crunch and poor conditions of primary markets. In addition, the challenge faced by industry in leveraged buyouts (LBOs), given stringent measures taken by the Reserve Bank of India(RBI) in the past few months, has become equally grave. The RBI hiked the Repo rate and Cash reserve Ratio (CRR) recently which led to an increase in prime lending rates by various banks. This has impacted mergers and acquisitions, felt experts gathered at a merger and acquisition event organised by Dun & Bradstreet. Indian M&A activity totaled $19.80 billion in FY08 as compared to $33.1 billion in FY07. The decline of M&A activity was in line with the global activity. The average size of deals in FY08 was $23.4 million, far lower than the $70.5 million level seen in FY07.

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COMMODITIES

12)The three national commodity exchanges – the Multi Commodity Exchange (MCX), the National Commodity & Derivatives Exchange(NCDEX) and the National Multi Commodity Exchange(NMCE) – recorded a 45 per cent rise in turnover in August 2008 as compared to last year. The rise was brought about primarily by renewed investor interest in commodity trading. However, the turnover witnessed a 20 per cent decline compared with July.

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13)With crude falling to five-month low on Wednesday, the aviation industry is not willing to repeat its mistake. All the airline companies have begun examining seriously the option of trading in aviation turbine fuel(ATF) futures on the multi-commodity ex- change(MCX).

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14)Ahmedabad-based National Multi-Commodity Exchange of India (NMCE), the third-largest commodities exchange in the country, will launch futures trading in coffee robusta estate pounded bulk from Tuesday, Chief Executive Officer Anil Mishra said on Friday.

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REAL ESTATE

15)Real estate developer Parsvnath Developers has announced the launch of Parsvnath Premier, a group housing project in Parsvnath city, Indore. The group housing project, spread over 6.3 acres, is located in Indore. The realisation from the project is about Rs 60 crore and it is scheduled to be complete by the end of 2011, the company announced in a release to the Bombay Stock Exchange.

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COMMUNICATIONS

16)STATE-owned BSNL has opened talks with private telcos for roaming agreements. If the talks are successful, subscribers of private operators will finally be able to roam on BSNL’s nation-wide network. While all private telcos have roaming agreements with each other, BSNL, till date, has not opened up its networks for roaming deals. At present, only subscribers of state-owned MTNL (whose services are restricted to Delhi and Mumbai) are allowed to roam on BSNL’S net- work.

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BUSINESS PROCESS OUTSOURCING

17)SINCE the business started, BPO agents have been put through American, Italian, French or British voice and accent training. Now it’s Indian languages like Bhojpuri, Marathi or Tamil which the BPO agents are trying to master. With a boom in the economy, the $1.6-billion domestic BPO market is all set to offer better customer service in regional languages. BPOs are spreading to small towns like Surat, Bidar, Pondichary, Ranchi, Raipur, Patna, Kochi or Hassan. Also, BPOs servicing customers from metro cities like Delhi or Mumbai are tapping into cultural associations and congregations around festivals to hire regional language talent.

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18)UK-based $2.6-billion services major Serco Group is in talks to acquire Indian BPO player InfoVision Group. The deal size is learnt to be Rs 200-250 crore. Industry sources say InfoVision, which is talking to a couple of IT-BPO firms including Serco for a sell-out, could finalise a buyer in the next 3-4 weeks.

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INFORMATION TECHNOLOGY

19)A slowdown in the global economy and sub-prime crisis the banking, financial, and insurance services(BFSI) sector, its major revenue earners, force the domestic IT industry to take a relook at its hiring strategy. Domestic IT firms such as Zensar, Polaris and to some extent Infosys, are now adopting concepts like just-in-time for hiring process to offset hiring costs. IT biggies such as Tata Consultancy Services, Infosys Technologies, Wipro and Satyam Computer Services hiring numbers tapered a bit on a year-on-year basis. Meanwhile, midsized firms like Hexaware even also deferred their hiring plans by nearly two quarters. Till date, the IT sector was known for hiring hundreds of employees every quarter. Stock analysts, too, evaluated domestic IT firms on this “growth” para- metre.

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20)As many companies try to cut down on expenses, video conferencing is becoming a preferred alternative to corporate travel. IT major Tata Consultancy Services said it has asked employees to use IP telephony, video conferencing and other Web 2.0 communication tools more extensively and travel only when there is a need.

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21)ACCESSING your desktops from remote locations is catching on among the Indian internet community. Nivio, India’s first online Windows desktop, is one such software that allows users to access data and applications stored on a PC from another remote PC in the world. However, analysts are sceptical about the immediate future of this in the domestic market due to low PC penetration.

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INTERNATIONAL

22)Crude oil fell more than $1 a barrel after a government report showed employers in the US cut more jobs last month than economists forecast, a signal that demand may drop. The euro strengthened against the dollar after the report. Crude oil for October delivery fell $1.05, or 1%, to $106.84 a barrel on the New York Mercantile Exchange.

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