Headlines (25 June 2009)

Date: 25 June 2009

Thought for the day

“You never get a second chance to make a good first impression.”

–Will Rogers

GENERAL

1)In a bid to attract foreign funds and overseas tourists, the Government has embarked on a ‘major initiative’ to identify 50 historical monuments in the country to be presented to the United Nations Educational, Scientific and Cultural Organisation(UNESCO) for earning a ‘World Heritage’ tag for them.

Indian Express

ECONOMY

2)India’s growth outlook has been revised upwards by the Organisation for Economic Co-operation and Development(OECD) in the wake of recovery signs in the global economy. Global financial major Citigroup also projected higher growth for the Indian economy due to increased investment inflows expected in 2009-10. In its semi-annual economic
outlook released on Wednesday, the Paris-based organisation projected a growth of 5.9 per cent in the current financial year ending March 2010 and 7.2 per cent for fiscal 2010-11, an upward revision of 160 basis points and 140 basis points, respectively.

BS

CORPORATE / INDUSTRY

3)THE Aditya Birla group, the country’s second largest cement maker, is looking at consolidating its cement business, currently being run by two companies – Grasim Industries and UltraTech Cement – weeks after Larsen & Toubro (L&T) sold its 11.5% stake in UltraTech.

ET

4)ABB, the power and automation technology group, has won orders worth Rs 220 crore from Tata Projects Ltd to provide power products and solutions for a super-critical coal-fired power plant under construction in Andhra Pradesh. The 2×800 megawatt Krishnapatnam thermal power plant will be the first in India to deploy super-critical technology on such scale.

FE

5)Surya Roshni Ltd on Wednesday announced plans to invest Rs 550 crore in the coming year in new plants for both capacity expansion and modernisation. The lighting and steel pipe manufacturer has also forecast a turnover of Rs 2,500 crore for the fiscal.

BL

MONEY & BANKING

6)The rupee was flat on Wednesday after it lost most of its gains in day trade. The domestic currency opened stronger at 48.40 and weakened to close at 48.56, same as the previous day’s close. The rupee opened with gains on the back of the rally in the Asian equities market and the dollar’s weakness against other major currencies in the overseas markets, said a dealer with a public sector bank. However, persistent dollar demand from oil companies and importers led the rupee to shed most of its gains, added the dealer.

BL

7)IT’S a move that could free up crores worth of bank capital for lending to sections of India Inc that are starved of funds. Reserve Bank of India is set to usher in central counterparty guarantee for all interbank currency forward transactions.

ET

8)STATE Bank of India, which accounts for close to one fifth of all bank lending in the country, has reduced its prime lending rates (PLR) by half a percentage point. Following this reduction, the bank’s PLR will come down to 11.75% effective June 29.

ET

9)CITIBANK has become the first foreign lender in the country to generate profits in excess of Rs 2,000 crore. The Indian operations of the US bank clocked a 20% rise in net profit after tax to Rs 2,173 crore for FY09(April-March) up from Rs 1,804 crore in the previous fiscal on the back of a sharp rise in fee income and lower expenses.

ET

INSURANCE

10)Insurance companies will look at standardising the nomenclature for various charges on unit-linked insurance policies (Ulips) and method for calculating premiums to simplify and bring transparency into life insurance business, office bearers of Life Insurance Council told reporters in Delhi on Wednesday.

ET

11)American insurer MetLife is keen on raising stake in its Indian venture to up to 49% as and when the government revises the cap on foreign holding in the sector. “If the Indian government decides to raise the cap on foreign investment in insurance companies, MetLife International would definitely invest more in India.

FE

12)ICICI Prudential Life Insurance has decided to do away with the Third Party Administrator and settle health claims directly. For this purpose, it has launched ‘ICICI Pru ClaimCare’ and set up a network of 2,500 hospitals, providing cashless service to policy holders across 488 locations.

BL

MARKETS

13)Indian equity indices closed the day above the dotted line following strong cues from the Asian markets and short covering ahead of Futures & Option(F&O) expiry of Thursday. The 30-share Sensex of Bombay Stock Exchange(BSE) added 98.72 points, or 0.96%, to close the day at 14,422.73 points. The broader S&P CNX Nifty of National Stock Exchange(NSE) gained 45.95 points, or 1.08%, to end the day at 4,292.95 points. Dealers in the market say, despite, volatility during the intra-day trading, domestic institutional investors (DIIs) were buyers while foreign institutional investors(FIIs) continued selling in the domestic markets. Barring Bankex, all the sectors in the BSE Sectoral indices closed the day in green.

FE

14)Educomp Solutions shares rose 11 per cent to Rs 3,427 on reports that the Pearson group will support its vocational learning venture. Pearson, the UK-headquartered education and information company, will acquire 50 per cent in Educomp’s vocational training business for $17.5 million. The venture will leverage Educomp’s existing network and Peason’s capabilities in the education space.

BS

15)THE Securities and Exchange Board of India(Sebi) is unlikely to alter the pricing formula for qualified institutional placements (QIPs) in the near future, according to an official familiar with the development. Recently, merchant bankers had made a presentation to the regulator, requesting that companies be given more flexibility while pricing QIPs.

ET

IPO / FPO

16)Power Grid Corporation of India plans to raise Rs 3,000 crore by the end of this fiscal or early next year through a follow-on public offer. “It will be through a fresh issue of 15 per cent of the company’s equity,” the Chairman and Managing Director, Mr S K Chaturvedi, told reporters on the sidelines of an industry conference.

BL

MUTUAL FUNDS

17)Retail investors take a longer-term view of mutual fund schemes than high net worth individuals (HNIs), FIIs, banks or financial institutions, according to the Association of Mutual Funds in India(AMFI). The findings of the first numbers released by the AMFI on holding periods of investors for March indicate that 46 per cent of retail investors – by assets – held their equity funds
beyond 24 months; 36.4 per cent of HNIs also had a two-year-plus holding period. However, only about 18 per cent of the banks,financial institutions and FIIs who invested in equity funds
held on beyond 24 months. More HNIs than retail investors held for one to two years. Overall, about 82 per cent of retail assets stayed on for more than a year in equity funds. The report also
indicates that equity funds made up 26 per cent of the total assets managed by the fund industry. Retail investors were the major investors in equity funds, making up 64.8 per cent of equity assets. They accounted for an even higher 68.2 per cent of the balanced funds.

BL

18)Toronto-based Lawrence Asset Management Inc is relaunching the Lawrence India Fund in Canada next month in partnership with Reliance Asset Management. The open-ended mutual fund was launched in January 2008 but stopped operations later because of the economic meltdown. “The India Fund will provide retail investors directly investment access to one of the world’s fastest growing economies through the knowledge and investment expertise of Reliance Asset Management’s team based in Singapore,” said Mr Ravi Sood, President of Lawrence Asset Management Inc, on Tuesday. He said the fund is a long and short-term equity fund that invests directly into the Indian equity market.

BL

19)THE state-owned lender, Bank of India(BoI), is seriously working towards making its foray into the mutual fund business. The bank was already having its MF arm, which was sold off by it to Taurus Mutual Fund few years ago.

FE

COMMODITIES

20)Commodity prices are expected to be stable and is expected to ease in near future. “Institutional investors are at present booking profits in commodities and metals and crude oil are expected to remain stable or may fall in the next quarter,” said Markus Rosgen, managing director and head-regional strategy, Citi Investment Research. China’s demand is also showing signs of slowing down, which supports this view.

BS

21)Gold hit a six-day high of $942 per ounce on Wednesday, tracking a volatile dollar as investors waited for the outcome of a US Federal Reserve policy meeting later in the day. Spot gold briefly spiked to $942.20 in London before paring gains to stand at $935.65 by 1340 GMT, up from $925.15 quoted late in New York on Tuesday.

BL

REAL ESTATE

22)A recent 10-city Crisil Research report on the real estate market indicates that demand in the residential market is expected to turn positive in 2010 owing to improvement in affordability, steady economic growth and greater liquidity. However a decline in the currently over-priced capital values of all the three real estate segments – residential, commercial and retail – will persist through 2009. Further the commercial and retail markets will continue to witness erosion in lease rentals through the next two years.

FE

INFORMATION TECHNOLOGY

23)SWITZERLAND-BASED banking and wealth management firm UBS is considering outsourcing about 5,000 jobs over the next two years, according to people familiar with its plans. This signifies an opportunity to win new business for Indian IT vendors such as Wipro and Infosys that already work with the Swiss bank.

ET

24)Firstsource Solutions has bagged a five-year, Rs 145-crore outsourcing deal from telecom services provider IDEA Cellular. As part of the deal, Firstsource will provide a suite of customer management interaction services on customer service, billing, new product information and plan details to IDEA Cellular’s Kerala and Tamil Nadu customers from its centre in Coimbatore.

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FOR MORE INFORMATION, PLEASE BROWSE THROUGH THE FOLLOWING SITES.

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