Maruti net rises 24%, exports up 52% despite rupee surge

Rising hatchback sales and a new premium car launch helped Maruti Suzuki India Ltd (MSIL), the country's largest car maker, post a 24% rise in third quarter net profit. The company's profit rose to Rs467 crore in the quarter of December 31, 2007 versus Rs 376.4 crore a year ago. Its exports grew by almost 52% just when its competitors reported negative exports sale. The company's net sales went up by 27.71% to Rs 4,654 crorefromRs3,644.19crore.

The launch of premium sedan SX4 and popular hatchback Swift drove MSIL's total sales by 16.86% to 2.01 lakhunitsfrom1.72 lakh units a year ago. But despite the strong performance, Maruti's shares fell by 0.63% on the Bombay Stock Exchange on Tuesday t ocloseatRs857.20.

In the export market, Maruti notched a 51.59% jump, sell ing13,754 units in the quarter against 9,073 units a year earlier.

This is despite the appreciation of rupee against the dollar.The industry's performance in the export market has been dismal with a negative growth rate.The country's largest exporter, Hyundai Motor India and other players like Tata Motors saw a dip in exports from the rising rupee.

Despite the prevailing high interest rates, the company's domestic sales went up by14.72% to 1.87 lakh units against

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Govt likely to tax companies on forfeited share money

India Incmay soon have to pay tax on capital income that arises for companies from money forfeited as part-payment for their shares.

At present, for subscribing to the share capital of a company, payments can be made in installments by an investor.

For instance, if investors apply for shares, they pay in part and are allotted the shares.But the investors have to pay the remaining amount by a stipulated date.

Any delay will mean forfeiting of the earlier installments by companies. The forfeited money remains with a company and is neither returned to shareholders nor to any government authority.

Companies also do not pay tax on this money, claiming it to be a capital receipt. Tax authorities feel the money should now be taxed because it is not earned through productive activities of companies.

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Article taken from the issue: 28 Jan 2008

Mukesh, Mallya, SRK now IPL team owners

Nothing exemplifies better the appeal of cricket in India than the disparate winning bidders for the Board of Control for Cricket in India's (BCCI's) Indian Premiere League (IPL) teams. They range from infrastructure and private equity firms to film stars.

While the organisers raised a whopping Rs 7,000 crore from the auction, franchisees will now market their individual teams and christen them in consultation with IPL. The rights last for ten years, starting from this year.

While GMR Holdings bagged team Delhi for Rs 336 crore, RIL won Mumbai for Rs 447.6 crore. India Cements snagged Chennai for Rs 364 crore, while UB Group picked up Bangalore for Rs 446.4 crore. Preity Zinta-Ness Wadia-Karan Paul-Mohit Burman won the Mohali team for Rs 304 crore, while UK's Emerging Media won Jaipur for Rs 268 crore. Hyderabad went to Deccan Chronicle Holdings for Rs

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Oil imports will cost 6% of GDP

India is expected to pay $17 billion more this fiscal towards its oil import bill compared with 2006-07. The sum is about the same as the government's plan expenditure for the entire transport sector.

According to data forwarded by the petroleum ministry to the finance ministry, the estimated oil import bill for 2007-08 would be around $73.83 billion (Rs 2,98,432 crore), against an actual import bill of $57.28 billion (Rs 2,59,418 crore) in 2006-07.

The annual oil import bill at $74 billion is over 6% of the country's GDP. The oil economy is therefore a critical component of the annual Budget, which the finance ministry takes into account when deciding receipts and expenditure for the year...

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Article taken from the issue: 24 Jan 2008

Fed moves to staunch bloodbath

After another day of equity markets awash in red, finally some good news.In a surprise development late on Tuesday, the US Federal Reserve announced a 75-basis point rate cut-one of its largest ever-which analysts said would buoy domestic sentiment and may help markets recover on Wednesday,although there are still leveraged positions to be unwound.

The Fed's announcement couldn't have come at a better time. It just took one minute from opening for the BSE Sensex to hit the 10%l ower circuit on Tuesday, as the after effects of Manic Monday continued into Torrid Tuesday and many were calling the bourse's locality Halal Street.

Weakening sentiment worldwide fuelled the selling pressure. The Sensex witnessed an intra-day plunge of 2,272.93 points and the S&P CNX Nifty of the NSE dropped 760 points intra-day, before correcting at the fag end of their sessions, mainly on the back of positive openings in European markets and some short covering at lowerl evels.

The Sensex finally closed at 16,729.94 points, posting its second-steepest fall of 875.41points, or 4.97%. The Nifty posted a loss of 309.5points, or 5.94%. But the Indian market was not the only one reeling under the super sell-off. Japan's Nikkei fell 5.65% while the Shanghai Composite Index fell 7.22%.

Dealers said margin

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BJP slams Left's ‘enemy' remarks

In a bid to unshackle itself from the alleged communal image and enhance its acceptability across the country, the BJP has consistently been trying to reach out to political forces. Taking this forward the party on Monday took exception to the word ‘enemy' attributed to it in CPI(M)'s draft political resolution ahead of the Left's 19th congress. Claiming the Left's expression ‘enemy No. 1' for it as a ‘medieval' political parlance, the BJP said, the document released by CPI(M)'s general secretary Prakash Karat smacks of ‘political arrogance' of its worst kind and that too particularly when ‘‘the Marxists have been pushed to the margins of the national politics with only 6% of vote share.'' Interestingly, the BJP's present criticism could well be seen in the backdrop of what once transpired between party's senior leader LK Advani and Congress general secretary Rahul Gandhi during a chance meeting at Delhi airport. Advani reportedly suggested the Congress' young leader that ‘‘the two-Congress and BJP- are the principal parties in the country and they should not treat each other as enemies. Rather the two at best could be political adversaries...

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Article taken from the issue: 22 Jan 2008

Cellular firms get subscriber check breather

The robust subscriber verification process, taken up by cellular operators, has now earned them a breather. A government-industry committee has decided that no penalty should be imposed on the companies for not reaching the 100% user verification target.

While acknowledging that all service providers were working hard to achieve the target, the committee suggested that companies could set periodic targets but warned them against not meeting those. It said penalty should be considered only if improvements in the verification percentages do not take place even after the warnings.

The development is a welcome relief for the cellular operators. As per a DoT order last year, a penalty of Rs 1,000 per unverified subscriber is applicable...

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Article taken from the issue: 21 Jan 2008

Sebi to curb IPO listing volatility

‘There seems to be a need to consider a price band even on the day of listing of IPOs. This would assist in a more orderly price discovery over a period of time' In order to curb excessive speculation and volatility of a stock at the time of listing, market regulator Securities & Exchange Board of India (Sebi) has proposed a 25% price band on the issue price on the listing day of an IPO up to Rs 250 crore in size. This would not apply in case of recommencement of trading in equity shares of a company on the stock exchange.

Providing the background of the proposal, Sebi said that currently, stock exchangestrading on the derivative segment," a Sebi circular stated. do not apply price bands on the day of listing IPOs. The price fixed by the company in consultation with its lead managers is left open to price discovery and after the day of listing, this process may continue within a price band of 20%. "For IPO issue sizes that are greater than Rs 500 crore, price bands are not imposed even af ter the day of listing if such scrips are available for

Sebi said that recently, it had been noticed that there ...
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Article taken from the issue: 18 Jan 2008

DNC: Trai gets tough on rogues

In what could be a huge reprieve for fixed-line and mobile subscribers, Telecom Regulatory Authority of India (Trai) on Wednesday suggested more stringent financial sanctions on non-compliant operators and telemarketers.

Proposing an amendment to the Telecom Unsolicited Commercial Communications Regulations, 2007, Trai said a telecom service provider not complying with the regulation should attract a penalty of Rs 5,000 for first offence and Rs 20,000 for subsequent offences. So far, the penalty was not levied on service providers but only on telemarketing companies.

It also proposed a revision in the tariff to be levied from a registered telemarketer to Rs 500 for the first unsolicited call and Rs 1,000 for subsequent unsolicited calls.

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Article taken from the issue: 17 Jan 2008

Rs 1-lakh Nano unveiled

Ratan Tata on Thursday finally unveiled his dream car to the world.

Driving onto the podium in a gleam ing Tata Nano at the ninth Auto Expo, the Tata group chairman silenced sceptics with a Rs 1-lakh car featuring rear-wheel drive and powered by a 623cc, 33 bhp multi-point fuel injection petrol engine.

"Despite a steep rise in input costs since the product was conceptualised four years back, we will introduce the car at Rs 1 lakh because a promise is a promise," Tata said.

The Nano, which will be rolled out from the company's upcoming plant at Singur in West Bengal by the second half of this fiscal, will be available in three variants: a standard and two deluxe models.

While the no-frills standard model will be available at a dealer price of Rs 1 lakh (excluding Vat and transportation), the deluxe models with additional features like air conditioning would carry a higher sticker price.

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Article taken from the issue: 10 Jan 2008