The acquisition of the European company will enable RCom set up fresh WiMax network in these countries and scale up the existing network. This would be company’s second acquisition in the WiMax space. In February, the company had acquired a significant stake in a French WiMax chip manufacturer Sequans Communications. The worldwide interoperability for microwave access (WiMax) is a telecommunications technology that provides wireless data over long distances in a variety of ways. RCom has set up WiMax networks in 18 cities in the country. As per RCom’s `Vision 2012’, the company intends to use undersea cables and WiMax-enabled last mile access in a similar number of geographies. It intends to provide highspeed broadband services, voice, video and data suite and 4G services, in the global market. The company intends to connect over 2.5 billion individuals over WiMax networks by then.
Wednesday, March 19, 2008
Reliance Communicationsplans WiMax services in 50 countries
Reliance Communications (RCom) is planning to set up WiMax networks across 50 countries in the next three years. To get a head start, RCom is planning to acquire a European WiMax operator that has WiMax licences in 20 countries across Eastern Europe, Africa and Latin America, in a $300-400 million (Rs 1,200-1,600 crore) deal.
The acquisition of the European company will enable RCom set up fresh WiMax network in these countries and scale up the existing network. This would be company’s second acquisition in the WiMax space. In February, the company had acquired a significant stake in a French WiMax chip manufacturer Sequans Communications. The worldwide interoperability for microwave access (WiMax) is a telecommunications technology that provides wireless data over long distances in a variety of ways. RCom has set up WiMax networks in 18 cities in the country. As per RCom’s `Vision 2012’, the company intends to use undersea cables and WiMax-enabled last mile access in a similar number of geographies. It intends to provide highspeed broadband services, voice, video and data suite and 4G services, in the global market. The company intends to connect over 2.5 billion individuals over WiMax networks by then.
The acquisition of the European company will enable RCom set up fresh WiMax network in these countries and scale up the existing network. This would be company’s second acquisition in the WiMax space. In February, the company had acquired a significant stake in a French WiMax chip manufacturer Sequans Communications. The worldwide interoperability for microwave access (WiMax) is a telecommunications technology that provides wireless data over long distances in a variety of ways. RCom has set up WiMax networks in 18 cities in the country. As per RCom’s `Vision 2012’, the company intends to use undersea cables and WiMax-enabled last mile access in a similar number of geographies. It intends to provide highspeed broadband services, voice, video and data suite and 4G services, in the global market. The company intends to connect over 2.5 billion individuals over WiMax networks by then.
Federal Reservecuts rates by 75 basis points
The Federal Reserve on Tuesday slashed a key interest rate by three-fourths of a percentage point, moving aggressively to contain a credit crisis threatening to push the country into a severe recession. The latest action brought the federal funds rate -- the interest that banks charge each other -- down to 2.25 percent, the lowest point since late 2004. It marked the second back-to-back cuts of three-fourths of a percentage point. It is the sixth cut in the past six months and comes at a time when the Fed is trying to keep the economy from slipping into recession - although many think it's already entered one.
The Fed cited a weakening labor market and a slowdown in spending by consumers, as well as a continued crisis in financial markets and tight availability of credit to justify the cut. The Fed acknowledged in its statement that inflation pressures have grown more than expected. However it still believed that the greater risk to the economy was that of slowing growth, not a spike in prices.
The Fed cited a weakening labor market and a slowdown in spending by consumers, as well as a continued crisis in financial markets and tight availability of credit to justify the cut. The Fed acknowledged in its statement that inflation pressures have grown more than expected. However it still believed that the greater risk to the economy was that of slowing growth, not a spike in prices.
The reduction in the funds rate was designed to lower borrowing costs and boost spending by consumers and businesses and thus increase economic activity. Economic growth slowed to a near standstill in the final three months of this year as the economy was hit by a series of blows including the credit crunch, a prolonged housing slump, rising unemployment and surging energy prices.
Q4 Advance tax figures: Growth momentum likely to continue
The Q4 advance tax figures, a bellwether of corporate profitability, announced yesterday indicate that the growth momentum is likely to continue amidst the global concerns looming in the backdrop. Expected slowdown in economic growth has not yet impacted corporate bottom line. It may be noted that the companies are required to pay the tax in four quarterly installments, the last being on March 15 every year.
Two companies saw the highest growth in terms of advance tax payout. Financial Services Company HDFC more than trebled its payout, while diversified conglomerate Reliance Industries saw the tax outgo nearly treble for the quarter.
United States Industrial production decelerate
Industrial production in United States eased by 0.5% in February 2008 from January 2008 levels. Infact, the country has been witnessing fall in the pace of growth from 0.4% in November 2007 to 0.2% in December 2007, which came down to 0.1% in January 2008 and finally a fall by 0.5% in February 2008, on a sequential basis over the previous month. On a y-o-y basis, the industrial production grew by 1% in February 2008 over February 2007 levels.
Much of the decrease in February 2008 has been attributed to a drop of 3.7% in the output of utilities. On the positive side, the mines output went up by 0.4% but on the flipside, the output of manufacturing sector decreased by 0.2%. As a result, the capacity utilization rate for total industry in February fell 0.6 percentage point, to 80.9%, which is the lowest rate since November 2005.
Much of the decrease in February 2008 has been attributed to a drop of 3.7% in the output of utilities. On the positive side, the mines output went up by 0.4% but on the flipside, the output of manufacturing sector decreased by 0.2%. As a result, the capacity utilization rate for total industry in February fell 0.6 percentage point, to 80.9%, which is the lowest rate since November 2005.
Tuesday, March 18, 2008
NTPC’s generation capacity close to 30,000 MW
National Thermal Power Corporation Ltd (NTPC) has commissioned a 500-MW unit of a thermal power plant in Bihar, taking its total generation capacity in the country close to the 30,000 MW-mark. NTPC’s second unit of 500 MW of Kahalgaon Thermal Power Project - Stage II located in Bihar has been successfully test synchronized on March 16. With the commissioning of this unit, the commissioned capacity of Kahalgaon project is 1,840 MW and the company’s total installed capacity stands at 29,144 MW.
BHEL bags Rs 2,030 cr Bihar order
Bharat Heavy Electricals Ltd (BHEL) has bagged a Rs 2,030-crore contract from Bhartiya Rail Bijlee Company (BRBCL) a joint venture company of NTPC Ltd and Indian Railways for the supply and installation of the main plant package for the upcoming 1,000 MW Nabinagar thermal power project in Bihar. BHEL’s scope of work includes design, engineering, manufacture, supply, erection and commissioning of steam generators with electrostatic precipitators and associated auxiliaries and so on. Slated for synchronization during the Eleventh Plan, these units will add 24 million units every day to the grid on commissioning.
REL may join hands with Indiabulls for Raigad SEZ
Reliance Energy (REL) is close to inking an agreement with Indiabulls Real Estate (IBREL) to jointly develop a 6,000-acre multi-product special economic zone (SEZ) in Maharashtra’s Raigad district, as per sources.
This move is part of REL’s aspirations to enter the real estate and infrastructure development. The 22-km Mumbai Trans Harbour Link (MTHL) project from Sewree to Nhava-Sheva, bagged by REL, would service this SEZ. The proposed SEZ will consist of an industrial processing area of 2,100 acres, a commercial area of 900 acres, a residential area of 1,500 acres, and open space of 1,500 acres. It will comprise of a central core with various industry hubs.
Facilities in the central core will include convention centres, business incubation facilities with ready-to-move-in office space and laboratories, R&D facilities and contract research, data centres and quality analysis and data retrieval facilities. Industry hubs will include institutions of learning and innovation, design and transportation facilities. The proposed residential space will comprise of residential developments and landscaped parks with central recreational facilities such as club houses, a tennis academy and green zones. The commercial space will include provisions for hotels, shopping facilities, office space, entertainment facilities and healthcare.
JSW in $2 bn deal with Japan’s Kawasaki Kisen Kaisha Ltd.
JSW Group has signed a $2 billion (Rs 8,160 crore), 10-year deal with Japan’s third biggest shipping firm by sales, Kawasaki Kisen Kaisha Ltd (or K Line), for transporting coal that will be used to fire the company’s steel and power plants, an arrangement that will ensure that the company is not affected by an increase in freight rates. As per the deal, K Line will deploy 10 dry bulk carriers to ship coking and thermal coal from mines owned by the OP Jindal group in Indonesia and Mozambique, as well as coal from mines in Australia and China.
The contract with K Line will start later in 2008 with two panamax ships. Five capesize ships and three more post-panamax ships will be deployed from 2011-12. By 2015, when all the ships enter service, JSW will be importing about 12 million tonnes of coal. JSW had earlier concluded ship charter contracts with K Line for three vesselsa panamax starting 2008 and two post-panamaxes starting 2009. Thus, the total volume of coal K Line will transport for JSW by 2015 is expected to be around 15 million tonnes per annum, which will be more than 40% of the total volume of coal to be imported by the two companies JSW Steel and JSW Energy. JSW Energy is the power generation outfit which plans to expand to 15,000MW by 2015 (including coal thermal and hydropower plants).
For JSW, the deal is beneficial as it will insulate the company from any escalation in freight rates. Dry bulk shipping rates have been rising mainly due to demands for shipping raw materials into China and India.
The contract with K Line will start later in 2008 with two panamax ships. Five capesize ships and three more post-panamax ships will be deployed from 2011-12. By 2015, when all the ships enter service, JSW will be importing about 12 million tonnes of coal. JSW had earlier concluded ship charter contracts with K Line for three vesselsa panamax starting 2008 and two post-panamaxes starting 2009. Thus, the total volume of coal K Line will transport for JSW by 2015 is expected to be around 15 million tonnes per annum, which will be more than 40% of the total volume of coal to be imported by the two companies JSW Steel and JSW Energy. JSW Energy is the power generation outfit which plans to expand to 15,000MW by 2015 (including coal thermal and hydropower plants).
For JSW, the deal is beneficial as it will insulate the company from any escalation in freight rates. Dry bulk shipping rates have been rising mainly due to demands for shipping raw materials into China and India.
Monday, March 17, 2008
JP Morgan buys Bear Stearns for $240 million
JP Morgan said on Sunday that they've bought Bear Stearns for $240 million. This is a tenth of its value. 85 years of independence was finished for Bear. It had grown to the fifth largest securities firm at Wall Street. Shareholders of Bear will get cash worth $2. This was valued at $30 just three days ago on March 14th. The highest this share had ever seen was $159. The embarassment was total after Bear's clients pulled $17 billion from it last week and that could've forced Bear into winding up. Bear Strearns had 14,000 employees. Their profits in 2006 were $1.2 billion, yet JP Morgan are paying less than one fourth the value of Bear Stearns' 1.2 million square feet 45 storied office building in Manhatten, New York valued at $1000 a sq.ft which makes it worth about $1.2 billion !At the peak last year, their share was at $159, one month ago at $80, at $60 on Thursday and $30 at close on Friday.
R-Power to acquire 100% in Indonesia coal mine
Reliance Power, has struck a deal to buy out a coalmine in Indonesia located in South Sumatra. The valuation of the coalmine, based on its reserves, is estimated to be around Rs 20,000 crore. The company is expected to announce its acquisition in a day or two.
This coalmine has resources of 2 billion tonnes and is spread over 100,000 acres. It will be the prime source of fuel for Reliance’s power project in Krishnapatnam in Andhra Pradesh. It is estimated that the Krishnapatnam ultra mega power project would require about 14 to 15 million tonnes of coal every year. Reliance Power is understood to have acquired the coalmine for about Rs 1,000 crore. It has acquired 100% interest in this coalmine. However, Reliance officials declined to comment on the development at present stage. This coalmine could be compared to one of the largest coalmines in India. The Gevera coalmine in Chhattisgarh has reserves of 1.2 billion tonnes and is producing around 35 million tonnes annually. Given that the acquired mine has resources of 2 billion tonnes, it is expected that the production from this mine should be more than the largest mine in India.
Although, the coal from this mine would be brought in for the Krishnapatnam project, it would also fuel other coal based power projects of the company. The acquisition is significant as it India is competing with energy hungry countries like China to acquire stakes in oil and coal blocks and secure energy security. Indonesia presents an attractive market for Indian companies due to its proximity to country's shores. Besides, Indonesian better in quality than Indian coal having less of ash content and higher calorific value.
This coalmine has resources of 2 billion tonnes and is spread over 100,000 acres. It will be the prime source of fuel for Reliance’s power project in Krishnapatnam in Andhra Pradesh. It is estimated that the Krishnapatnam ultra mega power project would require about 14 to 15 million tonnes of coal every year. Reliance Power is understood to have acquired the coalmine for about Rs 1,000 crore. It has acquired 100% interest in this coalmine. However, Reliance officials declined to comment on the development at present stage. This coalmine could be compared to one of the largest coalmines in India. The Gevera coalmine in Chhattisgarh has reserves of 1.2 billion tonnes and is producing around 35 million tonnes annually. Given that the acquired mine has resources of 2 billion tonnes, it is expected that the production from this mine should be more than the largest mine in India.
Although, the coal from this mine would be brought in for the Krishnapatnam project, it would also fuel other coal based power projects of the company. The acquisition is significant as it India is competing with energy hungry countries like China to acquire stakes in oil and coal blocks and secure energy security. Indonesia presents an attractive market for Indian companies due to its proximity to country's shores. Besides, Indonesian better in quality than Indian coal having less of ash content and higher calorific value.
Jindal Stainless plans Rs 6,000 crore expansion, also plans entry into logistics and power
Aiming to become one of the largest stainless steel makers in the world, Jindal Stainless plans to spend Rs 6,000 crore over the next two years to expand its manufacturing capacity which would take the total capacity to 2.5 million tonne by 2012. The company has already spent Rs 2,250 crore for 0.8 million tonnes capacity in phase-I at Jajpur. With new capacity being planned in two phases of 0.8 million tonnes each in Orissa, the total capacity of the company would be 2.5 million tonnes by 2012, making Jindal one of the largest integrated stainless steel manufacturers in the world.
Jindal Stainless Ltd also plans to set up an independent power project and a foray into the logistics sector. The company is setting up a separate firm named Jindal Infrastructure & Utility Ltd, under which both the power and infrastructure divisions will function. It will also provide stainless steel designs for projects such as airport up gradation.
Additionally, Jindal Stainless also plans to invest $100 million in a wholly owned mining and metal subsidiary in Singapore for buying mineral resources. In order to strengthen raw material supplies, it would be looking for chrome, nickel, manganese, coking and thermal coalmines. The Singapore subsidiary would be the holding company for the special purpose vehicles formed for acquiring mining assets.
Jindal Stainless Ltd also plans to set up an independent power project and a foray into the logistics sector. The company is setting up a separate firm named Jindal Infrastructure & Utility Ltd, under which both the power and infrastructure divisions will function. It will also provide stainless steel designs for projects such as airport up gradation.
Additionally, Jindal Stainless also plans to invest $100 million in a wholly owned mining and metal subsidiary in Singapore for buying mineral resources. In order to strengthen raw material supplies, it would be looking for chrome, nickel, manganese, coking and thermal coalmines. The Singapore subsidiary would be the holding company for the special purpose vehicles formed for acquiring mining assets.
Power ministry planning to establish three more ultra mega power projects
Power ministry is planning to establish three more ultra mega power projects (UMPPs), with a capacity to produce 4,000 MW of electricity each, in Orissa, in addition to the nine projects already being planned. There are coal blocks in Orissa, where the projects were to come up on direct bidding. These projects could be stretched further through a special purpose vehicle to be promoted by the Power Finance Corporation.
UMPPs are projects with a capacity of 4,000 mw or more. Three UMPPs have already been awarded on the basis of competitive bidding. The contract for the Mundra UMPP in Gujarat has been awarded to Tata Power while the Sasan contract in Madhya Pradesh and Krishnapatnam contract in Andhra Pradesh have been awarded to Reliance Power. Each UMPP is estimated to cost Rs 15,000 crore. The cost of generation per unit is estimated at under Rs 2.
UMPPs are projects with a capacity of 4,000 mw or more. Three UMPPs have already been awarded on the basis of competitive bidding. The contract for the Mundra UMPP in Gujarat has been awarded to Tata Power while the Sasan contract in Madhya Pradesh and Krishnapatnam contract in Andhra Pradesh have been awarded to Reliance Power. Each UMPP is estimated to cost Rs 15,000 crore. The cost of generation per unit is estimated at under Rs 2.
BHEL to acquire Bharat Heavy Plates & Vessels
Bharat Heavy Electricals Ltd (BHEL) plans to acquire Bharat Heavy Plates and Vessels Ltd (BHPVL) to augment its power-equipment manufacturing capacity. The decision is likely to be taken by the first half of next fiscal. Visakhapatnam-based BHPVL manufactures combustion systems, including industrial boilers and fired heaters, cryogenic systems, multi-player vessels, LNG import terminals and other utility systems to be used by power-generation units.
BHEL is looking for more domestic acquisitions in the engineering space. India plans to add about 78,000 MW of electricity in the 11th plan period. The country currently generates 141,000 MW of electricity annually through the use of coal, water, gas and other means. BHEL will spend Rs 4,200 crore to augment its capacity to make equipment to generate 15,000 MW of electricity by 2009, from the current 10,000 MW.
BHEL’s current order book is valued at Rs 82,000 crore, which is to be executed over the next three years. The company is also exploring international markets like West Asia and Africa for selling gas turbines and transformers.
BHEL is looking for more domestic acquisitions in the engineering space. India plans to add about 78,000 MW of electricity in the 11th plan period. The country currently generates 141,000 MW of electricity annually through the use of coal, water, gas and other means. BHEL will spend Rs 4,200 crore to augment its capacity to make equipment to generate 15,000 MW of electricity by 2009, from the current 10,000 MW.
BHEL’s current order book is valued at Rs 82,000 crore, which is to be executed over the next three years. The company is also exploring international markets like West Asia and Africa for selling gas turbines and transformers.
Government to fully bear Rs 60000 crore farm loan waiver, but over three financial years
The estimated farm loan waiver is about Rs 60314 crore, inclusive of total waiver amounting to Rs 50524 crore to small and marginal farmers and Rs 9790 crore as OTS to other farmers. Of the total, 55% will be for borrowings through cooperatives, 35% for borrowers from scheduled commercial banks (SCB) and 10% for borrowers from Regional Rural Banks (RRB).
The government will provide funds to the lending institutions over a period of 36 months from July 2008 to June 2011. Between July 2008 and June 2009, the government will provide Rs 25000 crore. The balance Rs 35000 crore will be provided in the next three budgets at Rs 15000 crore in Budget 2009-10, Rs 12000 crore in Budget 2010-11 and Rs 8000 crore in Budget 2011-02.
The Government will disburse Rs 25000 crore to lending institutions in July-August 2008 and another Rs 15000 crore in June-July 2009. In the process, about Rs 40000 crore, representing two third of the relief package will be released by August 2009. But the payment package would frontloaded in favour of cooperative institutions and RRBs that are typically more liquidity constrained than scheduled commercial banks. The amount will be funded by government from Tax revenues, non tax revenues, non debt capital receipts and additional borrowing, in the same order. Banks may actually stand to gain, atleast on books, to the extent of NPAs provided, as these can now be written back, as it will be paid by the government.
The government will provide funds to the lending institutions over a period of 36 months from July 2008 to June 2011. Between July 2008 and June 2009, the government will provide Rs 25000 crore. The balance Rs 35000 crore will be provided in the next three budgets at Rs 15000 crore in Budget 2009-10, Rs 12000 crore in Budget 2010-11 and Rs 8000 crore in Budget 2011-02.
The Government will disburse Rs 25000 crore to lending institutions in July-August 2008 and another Rs 15000 crore in June-July 2009. In the process, about Rs 40000 crore, representing two third of the relief package will be released by August 2009. But the payment package would frontloaded in favour of cooperative institutions and RRBs that are typically more liquidity constrained than scheduled commercial banks. The amount will be funded by government from Tax revenues, non tax revenues, non debt capital receipts and additional borrowing, in the same order. Banks may actually stand to gain, atleast on books, to the extent of NPAs provided, as these can now be written back, as it will be paid by the government.
52-Week Low on 18th March 2008
| Symbol | Company Name | 52-Week Low | Last Trade | Change |
| ORCHIDCHEM | Orchid Chemicals & Pharmaceuticals Ltd | 120.00 | 127.30 | -79.95 |
| ICICIBANK | ICICI Bank Ltd | 744.00 | 759.95 | -117.00 |
| HIMACHLFUT | Himachal Futuristic Communication Ltd | 16.60 | 16.95 | -1.50 |
| DISHTV | Dish TV India Limited | 42.10 | 43.00 | -5.15 |
| AMBUJACEM | Ambuja Cements Ltd | 96.00 | 118.05 | -1.90 |
| MTNL | Mahanagar Telephone Nigam Ltd. | 95.65 | 96.80 | -3.55 |
| NORTHGATE | Northgate Technologies Limited | 311.60 | 315.50 | -74.00 |
| ORGINFO | ORG Informatics Limited | 32.00 | 32.60 | -2.05 |
| DSKULKARNI | DS Kulkarni Developers Ltd. | 138.55 | 143.40 | -23.05 |
| ORIENTPPR | Orient Paper & Industries Ltd | 35.00 | 35.70 | -3.00 |
| RUCHINFRA | Ruchi Infrastructure Ltd. | 21.80 | 23.25 | -0.40 |
| PARSVNATH | Parsvnath Developers Limited | 200.00 | 200.60 | -13.80 |
| OMAXE | Omaxe Limited | 175.25 | 200.10 | -12.30 |
| MEGH | Meghmani Organics Limited | 17.00 | 18.90 | 0.85 |
| MOSERBAER | Moser-Baer (I) Ltd | 135.15 | 138.25 | -11.55 |
| AFTEK | Aftek Limited | 35.05 | 36.90 | -4.80 |
| DHAMPURSUG | The Dhampur Sugar Mills Ltd | 42.95 | 43.95 | -3.70 |
| IOLN | IOL Netcom Limited | 211.15 | 227.50 | -33.20 |
| GRAPHITE | Graphite India Limited | 43.15 | 43.90 | -5.50 |
| PRITHVI | Prithvi Information Solutions Limited | 139.45 | 139.45 | -34.85 |
| SPENTEX | Spentex Industries Ltd | 18.00 | 18.25 | -1.40 |
| VIDEOIND | Videocon Industries Limited | 278.00 | 280.60 | -21.95 |
| FINANTECH | Financial Technologies ( | 1410.30 | 1429.70 | -105.45 |
| FCH | Future Capital Holdings Limited | 460.00 | 528.55 | 48.05 |
| CCL | CCL Products ( | 139.00 | 143.00 | -10.30 |