HEADLINES (11 SEPTEMBER 2008)

GENERAL

1)The United States on Wednesday announced the sale of two dozen Harpoon II anti-ship missiles to India. The deal, worth over $170 million, was made public as Defence Minister A K Antony began a high-level visit to the U.S. This would be the first sale of American missiles to India.

Hindu

CORPORATE / INDUSTRY

2)JAPANESE spirits giant Suntory has made a surprise entry into liquor czar Vijay Mallya’s plans to divest 10 to 15% stake in United Spirits for about $600 million. Suntory’s approach comes even as USL kicked off initial talks with drinks giant Diageo, Pernod Ricard and Bacardi.

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3)Larsen & Toubro said on Wednesday it has bagged its largest ever order from South America. The heavy engineering division of the company has won a $160-million (over Rs 700 crore) order for manu- facture and supply of 10 hydrotreating reactors and 12 coke drums for Petrobras’ two lakh barrels per day(bpd) Northeast Refinery Project in Brazil, a news release from the company said.

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MONEY & BANKING

4)The rupee depreciated by 26 paise against the dollar on Wednesday, to levels last seen in November 2006. It crossed the psychologically important level of 45 to the dollar, on account of largescale dollar buying by gold and oil importers. There was a huge demand-supply mismatch as inflows were insufficient, said forex dealers. The domestic currency opened weaker at 44.92/94, but strengthened to 44.87. It then depreciated to 45.17 before recovering marginally to close at 45.10/11, against the previous close of 44.84.

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5)In view of inflation moderating slightly in recent weeks, HDFC Chairman, Deepak Parekh, hoped that there would be no further interest rate hikes even though there was a feeling in the market that the peaking interest rates could go up by another 0.5 percent.

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INSURANCE

6)IN the wake of rising terrorist threats across the country, click2insure.in – a portal launched by Optima Insurance Brokers in alliance with New India Assurance Company, a leading public sector non-life insurance provider – is offering a terrorism cover free of cost.

ET

MARKETS

7)Stocks fell for a second day, led by metals producers, as a drop in commodity prices heightened concern that global economic growth is slowing. Tata Steel and Steel Authority of India Ltd both lost at least 5 per cent amid speculation demand will fall. Sterlite Industries (India) Ltd slumped 12 per cent. Stocks also dropped as government figures showed overseas investors sold a net $7.18 billion in Indian equities this year. “Markets continue to be affected by bad news,” San Francisco-based Mr Seth Freeman, chief executive officer of EM Capital Inc said in an interview in Mumbai on Wednesday. “Selling by overseas investors is adding to the declines in the Indian market.” The Bombay Stock Exchange’s Sensitive Index, or Sensex, fell 238.15, or 1.6 per cent, to 14,662.61, adding to yesterday’s 0.3 per cent decline. The S&P CNX Nifty Index on the National Stock Exchange slid 68.45, or 1.5 per cent, to 4,400.25.

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8)The Securities and Exchange Board of India(Sebi) is working on a slew of measures to revive the corporate debt market. The measures include introducing the book-building process for bond issues similar to the one prevalent in the equity market and simplifying various other procedures.

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IPO / FPO

9)Shiv Nadar-promoted HCL Enterprise, which owns HCL Technologies and HCL Infosystems, is planning to form a venture capital (VC) arm and tap the bourses to raise close to $1 billion(Rs 4,400 crore) through an initial public offer(IPO). The venture, on the lines of Kishore Biyani’s Future Ventures India, will focus its investments in the information technology sector, said a source familiar with the development.

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10)NHPC, formally National Hydro Power Corporation, plans a follow-on offer after its proposed public issue in October. The company has got the government’s approval to dilute up to 24% of its stake – 10% through the IPO and another 14% through the follow-on offer. The entire equity dilution is expected to be completed by latest 2012.

ET

MUTUAL FUNDS

11)HDFC Mutual Fund is planning to launch a real estate mutual fund, a top company official said. “We plan to launch our real estate mutual fund within the next few months,” HDFC MF MD Milind Barwe said. Realty MFs would be different from the conventional schemes and the money collected would be invested in real estate projects and mortgage-backed securities.

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COMMODITIES

12)National Commodity & Derivatives Exchange Limited(NCDEX), a leading agri-commodity futures exchange, on Wednesday launched trading in thermal coal futures contract. The thermal coal futures contract will be an addition to its energy products offered for trading. With this launch, NCDEX will now offers 57 different commodities for trading.

FE

13)Gold recovered in Europe on Wednesday after hitting an 11-month low in Asian trade with rising oil prices boosting bullion’s appeal as an inflation hedge and on strong physical demand. Spot gold was at $775.50/776.60 an ounce against $775.80/777.80 in late New York, well off its session low of $762.55 an ounce, its weakest since Oct 2007.

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14)Gold and silver tumbled on the local bullion market on Wednesday on persistent offerings by stockists triggered by a fall in the global market. Standard gold (99.5 purity) fell by Rs 215 per ten gm to Rs 11,465 from Rs 11,680 and pure gold(99.9 purity) also dropped by Rs 225 per ten gm to Rs 11,530 from Rs 11,755. Silver ready(.999 fineness) also finished lower at Rs 19,300 against Rs 19,780, showing a sharp loss of Rs 480 per kg.

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15)Maize prices are expected to remain firm in the new season beginning October after the devastating floods in the largest maize growing state of Bihar is estimated to have destroyed 10 per cent of the country’s crop output, traders and analysts said.

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REAL ESTATE

16)The convergence of infrastructure development, real estate projects and government initiatives is expected to open large business opportunities and spread the benefits of growth across the country. This will be triggered by the unlocking of land value to finance the cost of infrastructure development through cross-subsidisation of projects and collection of betterment charges, says the Ficci-Ernst & Young (E&Y) report Indian Real Estate – Shifting Gears, released on Wednesday at the Ficci International Real Estate Summit 2008. Deepak Parekh, chairman HDFC, Pranay Vakil, chairman Knight Frank, Ganesh Raj, partner & leader real estate practice E&Y and Amit Mitra, secretary general Ficci released the report.

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17)Real estate firm Sobha Developers on Wednesday said it is constructing 40 premium villas at its Sobha City in Kerala at a cost of Rs 100 crore. These villas are the part of second phase of Sobha City in the State and is spread in an area of six acres. Sobha Developers said in a regulatory filing to the BSE.

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COMMUNICATIONS

18)Bharat Sanchar Nigam Ltd’s project for setting up mobile network for 93 million subscribers across the country, the world’s largest, has received bids from 6 vendors – Ericsson, Nokia Siemens, Alcatel Lucent, ZTE, Huawei and Nortel.

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19)BHARTI promoters have acquired an additional 0.5% stake in the telecom arm Bharti Airtel. Given the prevailing market price of the firm, this deal would be valued at around Rs 800-830 crore or about $195 million. Meanwhile, the promoters have also completed the purchase of 5.6% stake held by Vodafone.

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BUSINESS PROCESS OUTSOURCING

20)Indian BPO firms are beginning to see revenues from new pricing models such as outcome-based and transaction-based models as they offer more of non-voice, platform-based services diversifying from the traditional voice-based offerings.

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INFORMATION TECHNOLOGY

21)India’s fourth largest software exporter Satyam Computer Services is scouting for buyouts in Europe and US and will spend anywhere between $50 million(2.25 bln rupees) each on these acquisitions, Chief Financial Officer Srinivas Vadlamani said today. “Big ticket acquisitions are not new to us and there is no serious cap on the budget if we find a right fit,” he said, adding Satyam has short- listed four-five firms as potential acquisition candidates.

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22)IN A transaction representative of the aspirations of emerging Indian companies, Quality Assurance Institute (QAI) India, an operational excellence company enabling companies in the IT and ITES sectors to deliver high performance, has bought out its USA-based parent, QAI Worldwide. The 100% acquisition gives the Indian sub- sidiary established in 1994 an access to the large US market and also the rights over large intellectual property, which rests with the parent company founded in 1980 by William Perry.

ET

INTERNATIONAL

23)US Democratic presidential candidate Barack Obama may be struggling to nudge ahead of his Republican rival in polls at home, but people across the world want him in the White House, a BBC poll said on Wednesday. All 22 countries covered in the poll would prefer to see Obama elected US President ahead of Republican John McCain. And in 17 of the 22 nations, people expect relations between the US and the rest of the world to improve if Obama wins. More than 22,000 people were questioned by pollster GlobeScan in countries ranging from India to Australia, and across Africa, Europe and South America.

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24)After hours of wrangling, OPEC on Wednesday agreed to revise its complex output targets and said the move would effectively cut supplies by half a million barrels per day(bpd). Ministers of the Organisation of Petroleum Exporting Countries(OPEC) had been widely expected to stick to existing production allocations, which have been in place all year. But some voiced concern about a growing supplies of oil on the market and prices on Tuesday sank to a five- month low below $102 a barrel, around 30% below a record hit in July above $157. US crude was trading 65 cents higher at $103.90 at 5:13 a.m. EDT. The price had risen by a dollar immediately after OPEC’s announcement.

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25)Lehman Brothers Holding Inc, the fourth largest US securities firm, reported a $3.9 billion third-quarter loss and said it plans to sell a majority stake in its investment-management unit as it struggles to survive a crisis of investor confidence.

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