NEW DELHI: Japanese auto giant Toyota on Monday drove in Etios Liva compact at Rs 3.99 lakh (ex-showroom Delhi, entry-level model) to mark its presence in the high-volume small car segment in India. In a competitive segment, Liva will have to compete with existing leaders like Swift, Ritz from Maruti Suzuki, i10 (Kappa) of Hyundai and also with new-entrants like Beat from GM, Polo (Volkswagen) and Figo of Ford.
Toyota has been gradually ramping up operations in India as it seeks a larger footprint in the fast-growing emerging markets.
The 1200cc petrol-engine Liva shares the platform with the company's no-frills Etios sedan and will be Toyota's driver model in the crucial small car segment. "Toyota plans to further beef up its presence in the segment, though this would come at a later stage," Hiroji Onishi, president of Toyota Motor Asia Pacific, said.
The Liva comes at a time when Toyota is looking to expand its market share in the passenger vehicle segment to double digits compared to over 3% at present. Onishi admitted that the company was late to enter the compact car segment and competition was intense.
Toyota had earlier planned to launch the Liva in April, but the huge waiting list on the Etios forced it to postpone the plan by two months. Sandeep Singh, Deputy MD at Toyota Kirloskar Motors, said about 20,000 units of the Etios have already been despatched to dealerships and the waiting list had come down substantially, allowing the company to manufacture Liva comfortably. The company hopes to sell about 40,000 units of Etios and 20,000 units of Liva this year. "India is an integral part of our global growth strategy. The Etios project is a milestone not only for Toyota in India but for globally," Onishi said. He said the company's model portfolio in India required further cars. "Definitely, when we look at Toyota's line-up, it is not sufficient in response to the expanding market needs of India." The company could study possibilities with group company Daihatsu for this, though nothing concrete was happening at the moment, he added.
Toyota has plans to launch diesel versions of the Etios and Liva, though Singh refused to give a time-frame for that.
"We are ready with the technology and can launch it within a short period. However, I cannot speak about the timing right now."
The biggest challenge for Toyota, which enjoys a strong brand equity in India, is to fight with small car segment biggies —Maruti Suzuki and Hyundai. The two companies not only have a wide distribution and sales network across the country but also have a multi-model strategy that attracts customers at various price points.
Source- Times of India
steven
management trainee-fundamental analysis
DENIP consultants Pvt Ltd
Tuesday, June 28, 2011
Now, use your VISA debit card to buy Fidelity funds online
In what may give a fillip to online investing in mutual fund schemes, Fidelity Fund Management Pvt. Ltd has made the exercise a wee bit simpler. The company has allowed investors to use their VISA debit cards to buy funds from its website.
As of now, 27 banks with VISA debit cards are on the company’s list. The new facility will be in addition to the existing Internet banking facility, which the company offers to customers of about 39 banks in India.
Fidelity is the first mutual fund company to allow transactions with a debit card. However, all fund houses do allow Internet banking for buying funds online. With the Securities and Exchange Board of India recently indicating that it may introduce incentives for mutual fund distributors, it may make sense for you, the customer, to invest online that does not need an agent interface. And the ease of using a debit card may encourage investors to do so and increase online buying penetration. “Though I don’t have official confirmation, online buying of funds is still in low single digits,” says Rajan Krishnan, chief executive officer, Baroda Pioneer Asset Management Co. Ltd.
Fidelity is of the view that the initiative will help increase its reach beyond metros to tier II and tier III cities, where banks have a larger presence than any distribution network. Said Ashu Suyash, country head and managing director, Fidelity, “It helps expand the reach of online investing to over 100 million Visa debit card holders, many of whom are in locations beyond the top 10 cities. The debit card and Internet banking facilities together give our customers the option to choose from around 45 banks.”
At present the company manages assets under management of over Rs9,100 crore (as on 31 May) and has at least one million customers.
How to invest through debit card
If you wish to invest in Fidelity’s scheme using your debit card, visit the company’s website and register your login. You will get a list of schemes to choose from. Before placing your order to buy units, you will need to provide details of your VISA debit card, including the card number, expiry date of the card, CVV number and the Verified by Visa (VBV) password. Except VBV, all other details are mentioned on the card. In case you do not know your VBV password, you can generate it in a few minutes by going through an authentication process set up by your bank.
Online investing is cheaper, helps save time and enables you to invest anytime, anywhere.
Source:- http://www.livemint.com/2011/06/26224113/Now-use-your-VISA-debit-card.html
Thanks
Ankit Wani
Intern @ DENIP Consultants Pvt. Ltd.
As of now, 27 banks with VISA debit cards are on the company’s list. The new facility will be in addition to the existing Internet banking facility, which the company offers to customers of about 39 banks in India.
Fidelity is the first mutual fund company to allow transactions with a debit card. However, all fund houses do allow Internet banking for buying funds online. With the Securities and Exchange Board of India recently indicating that it may introduce incentives for mutual fund distributors, it may make sense for you, the customer, to invest online that does not need an agent interface. And the ease of using a debit card may encourage investors to do so and increase online buying penetration. “Though I don’t have official confirmation, online buying of funds is still in low single digits,” says Rajan Krishnan, chief executive officer, Baroda Pioneer Asset Management Co. Ltd.
Fidelity is of the view that the initiative will help increase its reach beyond metros to tier II and tier III cities, where banks have a larger presence than any distribution network. Said Ashu Suyash, country head and managing director, Fidelity, “It helps expand the reach of online investing to over 100 million Visa debit card holders, many of whom are in locations beyond the top 10 cities. The debit card and Internet banking facilities together give our customers the option to choose from around 45 banks.”
At present the company manages assets under management of over Rs9,100 crore (as on 31 May) and has at least one million customers.
How to invest through debit card
If you wish to invest in Fidelity’s scheme using your debit card, visit the company’s website and register your login. You will get a list of schemes to choose from. Before placing your order to buy units, you will need to provide details of your VISA debit card, including the card number, expiry date of the card, CVV number and the Verified by Visa (VBV) password. Except VBV, all other details are mentioned on the card. In case you do not know your VBV password, you can generate it in a few minutes by going through an authentication process set up by your bank.
Online investing is cheaper, helps save time and enables you to invest anytime, anywhere.
Source:- http://www.livemint.com/2011/06/26224113/Now-use-your-VISA-debit-card.html
Thanks
Ankit Wani
Intern @ DENIP Consultants Pvt. Ltd.
Grasim Industries moves up on restarting production at its Nagda plant
Grasim Industries is currently trading at Rs 2076.70, up by 6.10 points or 0.29% from its previous closing of Rs 2070.60 on the BSE.
The scrip opened at Rs 2075.00 and has touched a high and low of Rs 2088.00 and Rs 2055.00 respectively. So far 40743 shares were traded on the counter.
The BSE group 'A' stock of face value Rs 10 has touched a 52 week high of Rs 2625.00 on 06-Apr-2011 and a 52 week low of Rs 1740.00 on 30-Jun-2010.
Last one week high and low of the scrip stood at Rs 2112.00 and Rs 1981.20 respectively. The current market cap of the company is Rs 18985.80 crore.
The promoters holding in the company stood at 25.53% while Institutions and Non-Institutions held 41.74% and 21.70% respectively.
Grasim Industries which has temporarily suspended production at its Staple Fibre Plant at Nagda fully and that of Chlor-Alkali Plant at Nagda by half due to water shortage, has now informed that with the onset of monsoon and the arrival of water in the Nagda reservoir, the Staple Fibre Plant at Nagda and the Chlor-Alkali Plant at Nagda have restarted in gradual manner and the production is expected to be restored at their full capacity by June 30, 2011.
The company’s net profit for the fourth quarter has jumped by 36.70% at Rs 395.54 crore as compared to Rs 289.35 crore for the corresponding quarter previous year. Its total income has increased by 29.30% at Rs 1546.71 crore for the quarter under review from Rs 1196.17 crore in the corresponding previous quarter.
Source:- http://money.livemint.com/News/Home/EQUITY/MOVERS-TODAY/141911.aspx
Thanks
Ankit Wani
Intern @ DENIP Consultants Pvt. Ltd.
The scrip opened at Rs 2075.00 and has touched a high and low of Rs 2088.00 and Rs 2055.00 respectively. So far 40743 shares were traded on the counter.
The BSE group 'A' stock of face value Rs 10 has touched a 52 week high of Rs 2625.00 on 06-Apr-2011 and a 52 week low of Rs 1740.00 on 30-Jun-2010.
Last one week high and low of the scrip stood at Rs 2112.00 and Rs 1981.20 respectively. The current market cap of the company is Rs 18985.80 crore.
The promoters holding in the company stood at 25.53% while Institutions and Non-Institutions held 41.74% and 21.70% respectively.
Grasim Industries which has temporarily suspended production at its Staple Fibre Plant at Nagda fully and that of Chlor-Alkali Plant at Nagda by half due to water shortage, has now informed that with the onset of monsoon and the arrival of water in the Nagda reservoir, the Staple Fibre Plant at Nagda and the Chlor-Alkali Plant at Nagda have restarted in gradual manner and the production is expected to be restored at their full capacity by June 30, 2011.
The company’s net profit for the fourth quarter has jumped by 36.70% at Rs 395.54 crore as compared to Rs 289.35 crore for the corresponding quarter previous year. Its total income has increased by 29.30% at Rs 1546.71 crore for the quarter under review from Rs 1196.17 crore in the corresponding previous quarter.
Source:- http://money.livemint.com/News/Home/EQUITY/MOVERS-TODAY/141911.aspx
Thanks
Ankit Wani
Intern @ DENIP Consultants Pvt. Ltd.
Foreigners allowed to invest in mutual funds
Cap of $10 billion proposed; Sebi to notify final rules by August 1.
In an attempt to manage the volatile capital flows, the finance ministry today allowed foreign individuals to invest up to $10 billion in domestic mutual funds.
The Securities and Exchange Board of India (Sebi) will notify the rules by August 1. The move was announced in the Budget.At present, besides resident Indians, only foreign institutional investors (FIIs), sub-accounts registered with Sebi and non-resident Indians can invest in mutual funds in India.
The move will give mutual funds access to more foreign money. The fund industry, however, reacted with caution and said it would wait for the final guidelines.
FRAMEWORK OF THE DIRECT ROUTE FOR INVESTING
* A foreign investor opens a demat account in India
* Places an order to buy MF units directly on the depository participant (DP)
* Remits money directly to DP, which is mandated to report to the custodian on a daily basis
* MF deposits the units according to the investor’s instructions in the demat account
* MF units can be sold and foreign exchange remitted by the MF to the DP
FRAMEWORK OF UNIT CONFIRMATION RECEIPT (UCR) SYSTEM
* A foreign investor goes to an overseas depository and hands over foreign currency
* Places an order with the depository to buy units of Indian MFs
* The depository receives cash and remits it to the custodian bank in India, which buys MF units according to the investor’s instructions
* The depository issues UCRs against underlying units to foreign non-institutional investors
* UCRs can be surrendered for cash with the depository
The move comes at a time the government is finding it difficult to fund its current account deficit due to volatile capital flows and higher imports. Foreign retail participation in mutual funds may address the balance of payments problem by bringing in more stable funds and reducing the dependence on FII inflows, which are volatile.
The entry of foreign investors may add another Rs 45,000 crore ($10 billion) to mutual funds’ assets under management of Rs 7,31,448 crore. Out of this, Rs 1,92,087 crore is invested in equity.
The investment limit could be increased if inflows were good and did not fluctuate much, said officials.
“We are willing to review the limit after six months, if required. It will be a guard against volatility as retail investors stay invested for the long term. So, it will increase the depth of the market,” said Thomas Mathew, joint secretary, capital markets, finance ministry.
The new class of investors, called qualified foreign investors (QFIs), will be able to invest through the depository participant (DP) route as well as the unit confirmation receipt (UCR) system, which will involve custodians.
In the first option, a QFI will open a demat account with a depository in India and buy units. In the second option, an investor will place an order with an overseas depository, which will then transfer it to a custodian bank in India for buying the units.
QFIs can be individuals and bodies, including pension funds. Fund houses will be responsible for deducting tax at source.
The industry reacted with caution. Executives said the move could be a game changer but added they would have to first see the final guidelines to judge its impact.
Sundeep Sikka, chief executive officer, Reliance Mutual Fund, said, “It’s a step in the right direction and will contain volatility. It is not only good for asset management companies but also for the capital markets.”
Arindam Ghosh, chief executive officer, Mirae Asset Global Investment (India), said, “The government has kept a reasonable limit. This has an explosive potential, but we are waiting for the final guidelines.” He said the move would lower the volatility in fund flows. “The churn ratio in India is higher than the global figure. We have to see how stable funds from foreign individual investors are,” he said.
A section of fund managers said the decision to put a cap was premature. “It is not possible for domestic fund managers to sell products overseas given the regulatory hurdles in other countries,” said the chief investment officer of one of the top ten fund houses in the country.
“It will not give a major boost to domestic fund houses. I suspect this route will be used by Indians to bring black money into the country,” said an industry veteran.
The chief executive of a mid-sized fund house said the industry was likely to see a lot of volatility in fund flows, leading to underperformance of mutual funds. He added the decision could impact other investors too.
Source:http://www.business-standard.com/india/news/foreigners-allowed-to-invest-in-mutual-funds-/440734/
Thanks & Regards,
Monindro Saha
Summer Intern @ DENIP Consultants PVT LTD.
In an attempt to manage the volatile capital flows, the finance ministry today allowed foreign individuals to invest up to $10 billion in domestic mutual funds.
The Securities and Exchange Board of India (Sebi) will notify the rules by August 1. The move was announced in the Budget.At present, besides resident Indians, only foreign institutional investors (FIIs), sub-accounts registered with Sebi and non-resident Indians can invest in mutual funds in India.
The move will give mutual funds access to more foreign money. The fund industry, however, reacted with caution and said it would wait for the final guidelines.
FRAMEWORK OF THE DIRECT ROUTE FOR INVESTING
* A foreign investor opens a demat account in India
* Places an order to buy MF units directly on the depository participant (DP)
* Remits money directly to DP, which is mandated to report to the custodian on a daily basis
* MF deposits the units according to the investor’s instructions in the demat account
* MF units can be sold and foreign exchange remitted by the MF to the DP
FRAMEWORK OF UNIT CONFIRMATION RECEIPT (UCR) SYSTEM
* A foreign investor goes to an overseas depository and hands over foreign currency
* Places an order with the depository to buy units of Indian MFs
* The depository receives cash and remits it to the custodian bank in India, which buys MF units according to the investor’s instructions
* The depository issues UCRs against underlying units to foreign non-institutional investors
* UCRs can be surrendered for cash with the depository
The move comes at a time the government is finding it difficult to fund its current account deficit due to volatile capital flows and higher imports. Foreign retail participation in mutual funds may address the balance of payments problem by bringing in more stable funds and reducing the dependence on FII inflows, which are volatile.
The entry of foreign investors may add another Rs 45,000 crore ($10 billion) to mutual funds’ assets under management of Rs 7,31,448 crore. Out of this, Rs 1,92,087 crore is invested in equity.
The investment limit could be increased if inflows were good and did not fluctuate much, said officials.
“We are willing to review the limit after six months, if required. It will be a guard against volatility as retail investors stay invested for the long term. So, it will increase the depth of the market,” said Thomas Mathew, joint secretary, capital markets, finance ministry.
The new class of investors, called qualified foreign investors (QFIs), will be able to invest through the depository participant (DP) route as well as the unit confirmation receipt (UCR) system, which will involve custodians.
In the first option, a QFI will open a demat account with a depository in India and buy units. In the second option, an investor will place an order with an overseas depository, which will then transfer it to a custodian bank in India for buying the units.
QFIs can be individuals and bodies, including pension funds. Fund houses will be responsible for deducting tax at source.
The industry reacted with caution. Executives said the move could be a game changer but added they would have to first see the final guidelines to judge its impact.
Sundeep Sikka, chief executive officer, Reliance Mutual Fund, said, “It’s a step in the right direction and will contain volatility. It is not only good for asset management companies but also for the capital markets.”
Arindam Ghosh, chief executive officer, Mirae Asset Global Investment (India), said, “The government has kept a reasonable limit. This has an explosive potential, but we are waiting for the final guidelines.” He said the move would lower the volatility in fund flows. “The churn ratio in India is higher than the global figure. We have to see how stable funds from foreign individual investors are,” he said.
A section of fund managers said the decision to put a cap was premature. “It is not possible for domestic fund managers to sell products overseas given the regulatory hurdles in other countries,” said the chief investment officer of one of the top ten fund houses in the country.
“It will not give a major boost to domestic fund houses. I suspect this route will be used by Indians to bring black money into the country,” said an industry veteran.
The chief executive of a mid-sized fund house said the industry was likely to see a lot of volatility in fund flows, leading to underperformance of mutual funds. He added the decision could impact other investors too.
Source:http://www.business-standard.com/india/news/foreigners-allowed-to-invest-in-mutual-funds-/440734/
Thanks & Regards,
Monindro Saha
Summer Intern @ DENIP Consultants PVT LTD.
FM seeks support for easing rate hike impact
Finance minister Pranab Mukherjee sought state governments’ support in reducing the impact of the steep hike in prices of diesel, kerosene and liquefied petroleum gas (LPG) on the common man even as some top officials claimed that the rise will only have a temporary effect on inflation.
In a letter to state chief ministers on Monday, Mukherjee asked them to reduce levies on diesel, kerosene and LPG in line with the duty cuts undertaken by the Cental government.
An empowered group of ministers (eGoM) headed by Mukherjee on Friday had raised the price of diesel by Rs.3 per litre, LPG by Rs.50 per cylinder, and kerosene by Rs.2 per litre. It also slashed customs and excise duties on petroleum products, which will result in a total revenue loss of about Rs.49,000 crore to the government this year.
On Monday, a few states announced measures to ease the burden on the consumers by cutting levies. The states include Delhi, Kerala, Uttarakhand and Punjab.
The Congress party government in Delhi announced that LPG cylinders in Delhi will cost Rs.40 less for the below poverty line (BPL) families and diesel Rs.0.37 less for all consumers. Diesel will now cost Rs.40.75 a litre in Delhi for all consumers while LPG will be priced at Rs.355.35 a cylinder for families covered under the BPL and Antyodaya schemes.
Delhi became the third state after West Bengal and Haryana to announce reduction in prices of oil products. The Congress party-led government in Kerala also lowered the price of diesel by Rs.0.75 a litre forgoing the additional tax, which would have accrued to the state exchequer after the recent price increase.
The Bharatiya Janata Party (BJP) government in Uttarakhand also announced that it would waive the value-added tax (VAT) on kerosene, and would not charge VAT on the amount recently increased for diesel and LPG. Similarly, the Shiromani Akali Dal-BJP coalition government in Punjab exempted VAT on the hiked amount of diesel and LPG making diesel cheaper by Rs.0.25 a litre and LPG by Rs.2.50 per cylinder.
Planning Commission deputy chairman Montek Singh Ahluwalia said the Centre’s decision to cut duties on other petroleum products will have a negative impact on the fiscal deficit but maintained that the increase in prices will only have a temporary effect on inflation.
In his letter, Mukherjee said the Union government has so far been resisting an imminent increase in the prices despite high prices of crude oil in the international market, which had led to mounting losses of the state-owned oil marketing companies.
“Even though the Central government has been under compulsion to maintain its fiscal and budgetary resource management targets and find additional resources to finance various welfare schemes, it has sacrificed its revenues from the oil sector on account of customs and excise duty in order to minimize the impact on the common man,” the official release said citing the finance minister’s letter.
The Congress party defended the government saying that it was done in the national interest. “When prices rise, it affects common people. We are sensitive towards it. But sometimes hard decisions have to be taken in national interest”, party spokesman Manish Tewari said. However, senior BJP leader Murli Manohar Joshi alleged that the government’s move is intended to contain the fiscal deficit which was “going awry due to high corruption and faulty economic policies”.
Source:-http://www.livemint.com/2011/06/28021539/FM-seeks-support-for-easing-ra.html?atype=tp
Thanks
Ankit Wani
Intern @ DENIP Consultants Pvt. Ltd.
In a letter to state chief ministers on Monday, Mukherjee asked them to reduce levies on diesel, kerosene and LPG in line with the duty cuts undertaken by the Cental government.
An empowered group of ministers (eGoM) headed by Mukherjee on Friday had raised the price of diesel by Rs.3 per litre, LPG by Rs.50 per cylinder, and kerosene by Rs.2 per litre. It also slashed customs and excise duties on petroleum products, which will result in a total revenue loss of about Rs.49,000 crore to the government this year.
On Monday, a few states announced measures to ease the burden on the consumers by cutting levies. The states include Delhi, Kerala, Uttarakhand and Punjab.
The Congress party government in Delhi announced that LPG cylinders in Delhi will cost Rs.40 less for the below poverty line (BPL) families and diesel Rs.0.37 less for all consumers. Diesel will now cost Rs.40.75 a litre in Delhi for all consumers while LPG will be priced at Rs.355.35 a cylinder for families covered under the BPL and Antyodaya schemes.
Delhi became the third state after West Bengal and Haryana to announce reduction in prices of oil products. The Congress party-led government in Kerala also lowered the price of diesel by Rs.0.75 a litre forgoing the additional tax, which would have accrued to the state exchequer after the recent price increase.
The Bharatiya Janata Party (BJP) government in Uttarakhand also announced that it would waive the value-added tax (VAT) on kerosene, and would not charge VAT on the amount recently increased for diesel and LPG. Similarly, the Shiromani Akali Dal-BJP coalition government in Punjab exempted VAT on the hiked amount of diesel and LPG making diesel cheaper by Rs.0.25 a litre and LPG by Rs.2.50 per cylinder.
Planning Commission deputy chairman Montek Singh Ahluwalia said the Centre’s decision to cut duties on other petroleum products will have a negative impact on the fiscal deficit but maintained that the increase in prices will only have a temporary effect on inflation.
In his letter, Mukherjee said the Union government has so far been resisting an imminent increase in the prices despite high prices of crude oil in the international market, which had led to mounting losses of the state-owned oil marketing companies.
“Even though the Central government has been under compulsion to maintain its fiscal and budgetary resource management targets and find additional resources to finance various welfare schemes, it has sacrificed its revenues from the oil sector on account of customs and excise duty in order to minimize the impact on the common man,” the official release said citing the finance minister’s letter.
The Congress party defended the government saying that it was done in the national interest. “When prices rise, it affects common people. We are sensitive towards it. But sometimes hard decisions have to be taken in national interest”, party spokesman Manish Tewari said. However, senior BJP leader Murli Manohar Joshi alleged that the government’s move is intended to contain the fiscal deficit which was “going awry due to high corruption and faulty economic policies”.
Source:-http://www.livemint.com/2011/06/28021539/FM-seeks-support-for-easing-ra.html?atype=tp
Thanks
Ankit Wani
Intern @ DENIP Consultants Pvt. Ltd.
Greek Unions Strike as Papandreou Seeks Support
Greek unions shut down government services, halted public transport and disrupted flights as Prime Minister George Papandreou urged lawmakers to obey their “patriotic conscience” and back tougher austerity measures.
Unions began their fourth general strike of the year at midnight, protesting Papandreou’s five-year plan of budget cuts and asset sales. The 48-hour walkout will be accompanied by rallies and marches to Parliament in Athens today.
“Voting for the medium-term plan means we can close this chapter of uncertainty for the Greek people,” Papandreou told lawmakers at the start of a three-day debate late yesterday. “From the brink of catastrophe we are securing, colleagues, the great opportunity to change our country.”
Papandreou faces his second survival test in a week tomorrow when lawmakers vote on the package that’s needed before the cash-strapped nation can tap a fifth loan payment from last year’s 110 billion-euro ($157 billion) rescue. Failure to pass the government’s 78 billion-euro plan may lead to the euro area’s first sovereign default.
“I am fully aware of the reality, fully aware of the risks for the average Greek,” Finance Minister Evangelos Venizelos said in Parliament in the same debate, defending the planned tax increases and state asset sales. “We have to stabilize the situation. But we must first survive on a fiscal basis to be able to improve this situation.”
Vote Looms
With 155 votes in the 300-seat legislature, Papandreou needs to unite his lawmakers in two votes this week on budget cuts and asset sales. Two ruling-party lawmakers have said they may vote against the legislation, in part due to their opposition to plans to sell a stake in Public Power Corp. SA.
Workers at the former electricity monopoly have held rolling 48-hour strikes for the past week, leading to power cuts around the country.
Air traffic controllers will cease work for eight hours today and tomorrow, according to a statement on the union’s website, which has caused the cancellation of all flights into and out of the Athens International Airport, the country’s biggest, between 8 a.m. and midday and 6 p.m. and 10 p.m. today, according to an airport statement.
Aegean Airlines SA (AEGN) will reschedule 97 flights and cancel 26 today while Olympic Air will cancel and reschedule 52 flights.
Recession Impact
Implementing more austerity measures threatens to deepen a three-year recession and complicate efforts to boost government revenue and has stoked discontent among Greeks.
The economy contracted 4.4 percent in 2010 and will shrink a further 3.8 percent this year, according to a report from EU and International Monetary Fund inspectors in June. The nation’s debt load will peak at 166 percent of gross domestic product next year, and is already the biggest in the euro region’s history.
Papandreou’s plan includes higher taxes on restaurants and bars, higher heating-oil taxes and lowering the tax-free threshold to 8,000 euros from 12,000 euros presently. Greek newspaper To Vima calculated the additional burden for an average Greek family of four at 2,795 euros a year, about the same as one month’s income.
Source: www.bloomberg.com
Ravi Jhawar
Summer Intern-Technical Analyst
DENIP Consultants Pvt. Ltd.
Unions began their fourth general strike of the year at midnight, protesting Papandreou’s five-year plan of budget cuts and asset sales. The 48-hour walkout will be accompanied by rallies and marches to Parliament in Athens today.
“Voting for the medium-term plan means we can close this chapter of uncertainty for the Greek people,” Papandreou told lawmakers at the start of a three-day debate late yesterday. “From the brink of catastrophe we are securing, colleagues, the great opportunity to change our country.”
Papandreou faces his second survival test in a week tomorrow when lawmakers vote on the package that’s needed before the cash-strapped nation can tap a fifth loan payment from last year’s 110 billion-euro ($157 billion) rescue. Failure to pass the government’s 78 billion-euro plan may lead to the euro area’s first sovereign default.
“I am fully aware of the reality, fully aware of the risks for the average Greek,” Finance Minister Evangelos Venizelos said in Parliament in the same debate, defending the planned tax increases and state asset sales. “We have to stabilize the situation. But we must first survive on a fiscal basis to be able to improve this situation.”
Vote Looms
With 155 votes in the 300-seat legislature, Papandreou needs to unite his lawmakers in two votes this week on budget cuts and asset sales. Two ruling-party lawmakers have said they may vote against the legislation, in part due to their opposition to plans to sell a stake in Public Power Corp. SA.
Workers at the former electricity monopoly have held rolling 48-hour strikes for the past week, leading to power cuts around the country.
Air traffic controllers will cease work for eight hours today and tomorrow, according to a statement on the union’s website, which has caused the cancellation of all flights into and out of the Athens International Airport, the country’s biggest, between 8 a.m. and midday and 6 p.m. and 10 p.m. today, according to an airport statement.
Aegean Airlines SA (AEGN) will reschedule 97 flights and cancel 26 today while Olympic Air will cancel and reschedule 52 flights.
Recession Impact
Implementing more austerity measures threatens to deepen a three-year recession and complicate efforts to boost government revenue and has stoked discontent among Greeks.
The economy contracted 4.4 percent in 2010 and will shrink a further 3.8 percent this year, according to a report from EU and International Monetary Fund inspectors in June. The nation’s debt load will peak at 166 percent of gross domestic product next year, and is already the biggest in the euro region’s history.
Papandreou’s plan includes higher taxes on restaurants and bars, higher heating-oil taxes and lowering the tax-free threshold to 8,000 euros from 12,000 euros presently. Greek newspaper To Vima calculated the additional burden for an average Greek family of four at 2,795 euros a year, about the same as one month’s income.
Source: www.bloomberg.com
Ravi Jhawar
Summer Intern-Technical Analyst
DENIP Consultants Pvt. Ltd.
Nuclear supply may top NZ meet agenda
India is likely to discuss with New Zealand a recent decision by the Nuclear Suppliers Group (NSG)—which controls global nuclear commerce— that can affect India’s ability to source crucial technology for its ambitious civil nuclear power generation programme from the global market, two government officials said on Monday.
Given its topicality, the issue could come up in the talks between visiting New Zealand Prime Minister John Key and Manmohan Singh when they meet for talks on Tuesday, said one of the two officials. Both spoke on condition of anonymity.
New Zealand is one of the 46 NSG members, who on Friday passed new rules for the sale of nuclear enrichment and reprocessing (ENR) technologies. The second government official said India was studying the NSG’s new criteria.
Indian officials led by foreign secretary Nirupama Rao had met representatives from New Zealand and two other NSG members in May to lobby support for India’s case.
The new NSG criteria includes one that says ENR technology transfers will be allowed only if the recipient nation signs the nuclear Non-Proliferation Treaty. This has the potential to directly hit the special exception granted to India in 2008 by the NSG.
That special waiver had allowed India to buy power plants, equipment and technology from the international market without signing the NPT and open all its reactors to international scrutiny.
The exemption was also part of a process that saw the removal of three-decade-old embargoes against nuclear commerce between India and the world—despite the country having conducted nuclear tests in 1974 and 1998.
The NSG waiver was pushed through by the US, with which India worked out a significant bilateral pact in 2008 that opened the doors for the sale of US atomic plants to India. The energy-deficient South Asian nation has plans to ramp up production of nuclear power from 5,000MW currently to 20,000MW by 2020.
Other issues expected to figure during Key’s visit include a free trade agreement that would reduce high tariffs on a range of exports from New Zealand. Key said he expected the pact to be “signed by March 2012”, according to PTI. Bilateral trade now stands at just $1.0 billion, a figure that Key wants to double by 2014.
Commerce minister Anand Sharma, who visited Auckland in May, had said that the two countries can cooperate in several segments, including agriculture, pharmaceuticals, dairy products, research and development, tourism and films.
“Dairy and agriculture are two of focus areas for New Zealand,” Indian foreign ministry spokesman Vishnu Prakash said. New Zealand sees a huge and growing demand for milk and milk products in India given that India has 20% of the world’s population of children.
Indian investments in New Zealand were in the areas of forestry, mining and information technology, Prakash said. Some Indian firms with a presence in New Zealand include Mahindra and Mahindra, Satyam and Wipro, he said, adding Indian banks and insurers too had offices there.
New Zealand is also fast developing into a destination for Indian students, with almost 10,000 going there for various courses, Prakash said. This was up from 163 Indian students in that nation a decade ago.
Source:-
http://www.livemint.com/2011/06/28021659/Nuclear-supply-may-top-NZ-meet.html?atype=tp
Thanks
Ankit Wani
Intern @ DENIP Consultants Pvt. Ltd.
Given its topicality, the issue could come up in the talks between visiting New Zealand Prime Minister John Key and Manmohan Singh when they meet for talks on Tuesday, said one of the two officials. Both spoke on condition of anonymity.
New Zealand is one of the 46 NSG members, who on Friday passed new rules for the sale of nuclear enrichment and reprocessing (ENR) technologies. The second government official said India was studying the NSG’s new criteria.
Indian officials led by foreign secretary Nirupama Rao had met representatives from New Zealand and two other NSG members in May to lobby support for India’s case.
The new NSG criteria includes one that says ENR technology transfers will be allowed only if the recipient nation signs the nuclear Non-Proliferation Treaty. This has the potential to directly hit the special exception granted to India in 2008 by the NSG.
That special waiver had allowed India to buy power plants, equipment and technology from the international market without signing the NPT and open all its reactors to international scrutiny.
The exemption was also part of a process that saw the removal of three-decade-old embargoes against nuclear commerce between India and the world—despite the country having conducted nuclear tests in 1974 and 1998.
The NSG waiver was pushed through by the US, with which India worked out a significant bilateral pact in 2008 that opened the doors for the sale of US atomic plants to India. The energy-deficient South Asian nation has plans to ramp up production of nuclear power from 5,000MW currently to 20,000MW by 2020.
Other issues expected to figure during Key’s visit include a free trade agreement that would reduce high tariffs on a range of exports from New Zealand. Key said he expected the pact to be “signed by March 2012”, according to PTI. Bilateral trade now stands at just $1.0 billion, a figure that Key wants to double by 2014.
Commerce minister Anand Sharma, who visited Auckland in May, had said that the two countries can cooperate in several segments, including agriculture, pharmaceuticals, dairy products, research and development, tourism and films.
“Dairy and agriculture are two of focus areas for New Zealand,” Indian foreign ministry spokesman Vishnu Prakash said. New Zealand sees a huge and growing demand for milk and milk products in India given that India has 20% of the world’s population of children.
Indian investments in New Zealand were in the areas of forestry, mining and information technology, Prakash said. Some Indian firms with a presence in New Zealand include Mahindra and Mahindra, Satyam and Wipro, he said, adding Indian banks and insurers too had offices there.
New Zealand is also fast developing into a destination for Indian students, with almost 10,000 going there for various courses, Prakash said. This was up from 163 Indian students in that nation a decade ago.
Source:-
http://www.livemint.com/2011/06/28021659/Nuclear-supply-may-top-NZ-meet.html?atype=tp
Thanks
Ankit Wani
Intern @ DENIP Consultants Pvt. Ltd.
PE funds flow to smaller cities
Two recent private equity (PE) deals show how capital has begun flowing to companies in low-income states and smaller cities.
In November 2010, Aureos Capital, a mid-market PE firm, invested $10 million (Rs.45.1 crore today) in Apollo BSR Hospital, based in Bhilai, Chhattisgarh. A month earlier, Fidelity Growth Partners invested $20 million in Shreem Electric Ltd, a power equipment and turnkey solutions provider in Sangli, Maharashtra.
Aureos, with $1.3 billion under management globally, is looking to make similar investments in low-income states.
Balaji Srinivas, managing director of Aureos India Advisors Pvt. Ltd, said: “We are looking for deals in places like Bihar and Orissa. Fifteen per cent of our investment in the new fund will go to such areas.”
Chhattisgarh is the 17th largest Indian state by population and accounts for 1.6% of national gross domestic product. Aureos has plans to raise a new PE fund.
In order to help it look for such deals, Aureos—apart from its own India team scouting for transactions—appointed a boutique investment bank to bring transactions on an exclusive basis. Apollo BSR was a transaction sourced through such an initiative. Srinivas declined to disclose the name of the bank.
Explaining the PE firm’s strategy for such deals, Srinivas of Aureos said: “There are markets where there is no competition. These markets have enough opportunities, so you have got to go to places where others don’t go and look for deals.”
Harshal Shah, chief executive, Reliance Technology Ventures Ltd, said: “A lot of deals will originate from such places. That’s where the action will be in the next 5-10 years.”
According to him several factors have contributed to companies coming up in low-income states. “It has become a lot easier for people to commute between places. In addition the policy at the centre has encouraged competition between states.”
“The deal was also interesting as we were not competing with other PE funds due to the fact that it is not located in a major city that typically attracts a lot of PE interest,” said Srinivas.
According to Avinash Gupta, head, financial advisory, Deloitte Touche Tohmatsu India Pvt. Ltd, to put a small amount of money, say $10-15 million, to work, PE firms need to go to such places. However, Gupta cautions that it is important to plan the exit from such deals. “Investors have to make sure that the company has a pan-India reach to achieve growth because the fund eventually has to exit.”
Aureos has already deployed 80% of its $100 million South Asia investments. Of the investments made, eight are in India, four in Sri Lanka and one in Bangladesh.
“We are in exit mode now as we have been investing since 2006 in India. By the end of 2011, if all goes well, we would have exited eight out of our 13 fund investments,” said Srinivas.
In the past six months, Aureos sold a part of its stake in Continental Warehousing Corp. (Nhava Seva) Ltd to Warburg Pincus India Pvt. Ltd. It had invested $16 million in the company in 2009 alongwith ePlanet Ventures. It also sold its stake in Accutest Research Laboratories to UK-based PE firm Greater Pacific Capital in October. It had invested $4 million in the company in 2006.
Aureos is also looking to exit its take in Hind High Vacuum Co Pvt. Ltd, a Banglore-based integrated vacuum and solar equipment company that the firm had invested in 2006. “It (Hind High Vaccum) is currently raising further funds for expansion, and we may look at an exit at the right price,” said Srinivas.
On a median basis, the fund has made 2.5-3 times returns on their exits, he added.
Deals India, published jointly by Mint, Dow Jones Newswires and The Wall Street Journal, is a one-stop destination for investment professionals following deal flow, deals news, private equity and venture capital activity in India.
Source:- http://www.livemint.com/2011/06/28015635/PE-funds-flow-to-smaller-citie.html?atype=tp
Thanks
Ankit Wani
Intern @ DENIP Consultants Pvt. Ltd.
In November 2010, Aureos Capital, a mid-market PE firm, invested $10 million (Rs.45.1 crore today) in Apollo BSR Hospital, based in Bhilai, Chhattisgarh. A month earlier, Fidelity Growth Partners invested $20 million in Shreem Electric Ltd, a power equipment and turnkey solutions provider in Sangli, Maharashtra.
Aureos, with $1.3 billion under management globally, is looking to make similar investments in low-income states.
Balaji Srinivas, managing director of Aureos India Advisors Pvt. Ltd, said: “We are looking for deals in places like Bihar and Orissa. Fifteen per cent of our investment in the new fund will go to such areas.”
Chhattisgarh is the 17th largest Indian state by population and accounts for 1.6% of national gross domestic product. Aureos has plans to raise a new PE fund.
In order to help it look for such deals, Aureos—apart from its own India team scouting for transactions—appointed a boutique investment bank to bring transactions on an exclusive basis. Apollo BSR was a transaction sourced through such an initiative. Srinivas declined to disclose the name of the bank.
Explaining the PE firm’s strategy for such deals, Srinivas of Aureos said: “There are markets where there is no competition. These markets have enough opportunities, so you have got to go to places where others don’t go and look for deals.”
Harshal Shah, chief executive, Reliance Technology Ventures Ltd, said: “A lot of deals will originate from such places. That’s where the action will be in the next 5-10 years.”
According to him several factors have contributed to companies coming up in low-income states. “It has become a lot easier for people to commute between places. In addition the policy at the centre has encouraged competition between states.”
“The deal was also interesting as we were not competing with other PE funds due to the fact that it is not located in a major city that typically attracts a lot of PE interest,” said Srinivas.
According to Avinash Gupta, head, financial advisory, Deloitte Touche Tohmatsu India Pvt. Ltd, to put a small amount of money, say $10-15 million, to work, PE firms need to go to such places. However, Gupta cautions that it is important to plan the exit from such deals. “Investors have to make sure that the company has a pan-India reach to achieve growth because the fund eventually has to exit.”
Aureos has already deployed 80% of its $100 million South Asia investments. Of the investments made, eight are in India, four in Sri Lanka and one in Bangladesh.
“We are in exit mode now as we have been investing since 2006 in India. By the end of 2011, if all goes well, we would have exited eight out of our 13 fund investments,” said Srinivas.
In the past six months, Aureos sold a part of its stake in Continental Warehousing Corp. (Nhava Seva) Ltd to Warburg Pincus India Pvt. Ltd. It had invested $16 million in the company in 2009 alongwith ePlanet Ventures. It also sold its stake in Accutest Research Laboratories to UK-based PE firm Greater Pacific Capital in October. It had invested $4 million in the company in 2006.
Aureos is also looking to exit its take in Hind High Vacuum Co Pvt. Ltd, a Banglore-based integrated vacuum and solar equipment company that the firm had invested in 2006. “It (Hind High Vaccum) is currently raising further funds for expansion, and we may look at an exit at the right price,” said Srinivas.
On a median basis, the fund has made 2.5-3 times returns on their exits, he added.
Deals India, published jointly by Mint, Dow Jones Newswires and The Wall Street Journal, is a one-stop destination for investment professionals following deal flow, deals news, private equity and venture capital activity in India.
Source:- http://www.livemint.com/2011/06/28015635/PE-funds-flow-to-smaller-citie.html?atype=tp
Thanks
Ankit Wani
Intern @ DENIP Consultants Pvt. Ltd.
Cement makers face multiple adversities
Cement firms have a problem of plenty. With capacity additions continuing, the industry surplus is expected to rise until fiscal 2013. This is assuming a demand expansion that at least equals the anticipated growth in the country’s gross domestic product of around 8%.
But concerns are building up as the demand growth had halved to 5% compared with the past three years. May saw scant growth in demand with the forthcoming monsoon further worsening the situation. An Alchemy Share and Stock Brokers Pvt. Ltdreport indicated that cement prices fell by 8-10% across regions in April and May.
A bigger negative is the rising clinker (from which cement is made) inventory with most cement firms, which adds to holding cost. Besides, for the want of storage space, cement firms may be forced to shut operations if clinker stock rises.
In other words, the buoyancy seen in cement prices and higher realizations during the last six months were perhaps a flash in the pan. No wonder, shares of both large-cap firms such as UltraTech Cement Ltd, ACC Ltd and Ambuja Cements Ltd, along with mid-cap firms such as Madras Cement Ltd have run downhill since May.
Aggravating the situation was the hike in excise duty and the increase in coal prices that threaten to negate the benefits of higher realizations in the last few months. Raw material costs are estimated to have surged by one-and-a-half times in the last five years. Also, the diesel price hike is expected to affect freight costs and also fuel costs for firms that use generators to back their power requirements.
A report from Centrum Broking Ltd estimates that the recent Rs3 per litre hike in diesel prices will have a direct impact (transportation of end products) of 0.85 percentage point on the earnings before interest, tax, depreciation and amortization margin—a key measure of profitability—of cement makers, besides an indirect impact of 0.62 percentage point in procuring limestone and coal.
Cement firms seem to have exhausted efficiency improvements by setting up captive power plants and making blended cement. Given these odds, it’s a long way to recovery. A report by Macquarie Equities Research Ltd sees a two-year wait for a bull cycle for cement.
Only huge spending in infrastructure and housing will churn demand growth and stir the sector from its inertia.
Source:- http://www.livemint.com/2011/06/27234124/Cement-makers-face-multiple-ad.html
Thanks
Ankit Wani
Intern @ DENIP Consultants Pvt. Ltd.
But concerns are building up as the demand growth had halved to 5% compared with the past three years. May saw scant growth in demand with the forthcoming monsoon further worsening the situation. An Alchemy Share and Stock Brokers Pvt. Ltdreport indicated that cement prices fell by 8-10% across regions in April and May.
A bigger negative is the rising clinker (from which cement is made) inventory with most cement firms, which adds to holding cost. Besides, for the want of storage space, cement firms may be forced to shut operations if clinker stock rises.
In other words, the buoyancy seen in cement prices and higher realizations during the last six months were perhaps a flash in the pan. No wonder, shares of both large-cap firms such as UltraTech Cement Ltd, ACC Ltd and Ambuja Cements Ltd, along with mid-cap firms such as Madras Cement Ltd have run downhill since May.
Aggravating the situation was the hike in excise duty and the increase in coal prices that threaten to negate the benefits of higher realizations in the last few months. Raw material costs are estimated to have surged by one-and-a-half times in the last five years. Also, the diesel price hike is expected to affect freight costs and also fuel costs for firms that use generators to back their power requirements.
A report from Centrum Broking Ltd estimates that the recent Rs3 per litre hike in diesel prices will have a direct impact (transportation of end products) of 0.85 percentage point on the earnings before interest, tax, depreciation and amortization margin—a key measure of profitability—of cement makers, besides an indirect impact of 0.62 percentage point in procuring limestone and coal.
Cement firms seem to have exhausted efficiency improvements by setting up captive power plants and making blended cement. Given these odds, it’s a long way to recovery. A report by Macquarie Equities Research Ltd sees a two-year wait for a bull cycle for cement.
Only huge spending in infrastructure and housing will churn demand growth and stir the sector from its inertia.
Source:- http://www.livemint.com/2011/06/27234124/Cement-makers-face-multiple-ad.html
Thanks
Ankit Wani
Intern @ DENIP Consultants Pvt. Ltd.
IRDA not keen on introducing solvency II norms for companies in India
The Insurance Regulatory and Development Authority (IRDA) is not too keen on introducing solvency II norms for covering companies in India although insurers the world over are moving over to the new regime.
Indian insurers are still following solvency I norms.
"Our country does not have the required statistical database to adopt solvency II norms that have been devised by the European community. Domestic insurers use factor-based process for arriving at solvency margins and we are comfortable with it. It has a set formula and there is no scope of variation while arriving at capital requirements," RK Nair, member IRDA (finance & investment) told reporters in Kolkata. He was here to attend the 4th Indian Chamber of Commerce Summit 2011.
IPO norms for life insurance companies are likely to be finalised in the next few months, said Mr Nair.
Solvency II is the new regime for all insurers and reinsurers in the European Union . It will come into effect from December 31, 2012. Solvency II aims to implement solvency requirements that they feel will better reflect all kinds of risks that companies face. It aims to ensure understanding by insurers of the inherent business risks in the industry and the allocation of sufficient capital to cover them.
"The challenge for India, however, is that evaluation of risk can throw up different figures for regulators, insurers and valuers because there are no proper systems of evaluation or calculation of such risks in India," said Mr Nair.
On IPO norms for general insurance companies, Mr Nair said: "The norms will be similar to life insurance companies but exposure norms will be different. The way business is done by general insurers is different from the methods used by life insurers, and therefore, a different set of exposure norms will be required."
He also said general insurers may have to complete 10 years of operations before accessing the capital markets. The embedded value of an insurer will also have to be double the equity based of the company. Embedded capital is the present value of future profits.
Mr Nair added that the World Bank and the International Monetary Fund are currently evaluating accounting rules laid down by IRDA for domestic insurers to find out if they adhere to international standards.
"They will be meeting us in 3-4 rounds and are likely to submit a report early next year. The last assessment by World Bank was done during 2001," he said.
Source: The economic times
Vivek Agrawal
Summer Intern-Fundamental Analysis
DENIP Consultants Pvt. Ltd.
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