Nik's Diary
The
Indian market opened in the red today mirroring the negative opening trades in
the SGX nifty and most of the Asian bourses. The US markets continued to
perform well throughout the trading session on Tuesday and ended on a positive
note. Positive sentiment on the Wall Street was generated by the release of a
Commerce Department report showing a notable rebound in factory orders in the
month of February. Traders also kept an eye on developments in Europe, where
Cyprus was reportedly given an additional two years to meet the conditions
of its bailout agreement. Most of the European bourses rallied higher on
Tuesday, after returning from their four day Easter holiday weekend. Economic
data from Europe and the U.S. contributed to the positive mood. Meanwhile,
Indian markets rose sharply on Tuesday, extending recent gains after the RBI
rationalized investment limits for foreign investors in bonds in a bid to
attract more foreign flows to plug the widening current account deficit.
Investor sentiments were also improved after Finance Minister asserted that the
government remains committed to reforms.
L&T
Construction bagged `3,700cr orders in March
L&T Construction bagged new orders
worth Rs 3,700 crore under different business segments during March 2013. While
the building and factories business got orders for Rs 1,986 crore for building
residential towers and for commercial development, the power transmission and
distribution business accounted for orders valued at Rs 1,097 crore. A major
order is from the Punjab State Power Corporation for the execution of the
restructured accelerated power development and reforms programme on a turnkey
basis at Amritsar, Jalandhar and Ludhiana city. The work includes construction
of 66/11kV and 33/11kV grid substations, 11kV distribution lines, distribution
transformer centres, underground cabling and substations. An order from Power
Grid Corporation of India is for the construction of a 400 kV station at
Tuticorin. The solar business unit got orders worth Rs 373 crore for construction
of solar PV plants in Rajasthan and Tuticorin in Tamil Nadu, and the balance
orders for Rs 244 crore were for different ongoing projects in infrastructure,
metallurgical and material handling businesses, L&T said in a release. Source:
HinduBusinessLine
Supreme Court refuses closure
for Sterlite’s copper plant; fines `100cr
The Supreme Court Tuesday ordered Sterlite Industries, a
subsidiary of the UK-based Vedanta Group, to pay a record penalty of Rs 100
crore for inappropriately operating its copper smelting plant in Tuticorin and
damaging the environment between 1997 and 2012. The order came
three days after the Tamil Nadu Pollution Control Board ordered the plant shut
following an alleged gas leak on March 23, which left several people ill. "Considering
the magnitude, capacity and prosperity of the company, we are of the view that
it should be held liable for... Rs 100 crore for having polluted the
environment... and for having operated the plant without a renewal of the
consents by the Tamil Nadu Pollution Control Board...," a bench led by
Justice A K Patnaik said. "Any less amount would not have the desired
deterrent effect." Sterlite has three months to pay up. The money
will be used for environment protection in the plant's vicinity. The
bench, however, refrained, in "public interest", from ordering
permanent closure of the plant. It noted that Sterlite had removed 29 of the 30
deficiencies pointed out by experts, and contributed towards copper production
and job creation. Sterlite said it would continue to work in close association
with the state government and regulatory bodies. Source: Indian Express
Mukesh Ambani's 4G arm Reliance Jio inks `1,200cr pact
with Anil Ambani's RCom
In
the first significant collaboration between their companies since they scrapped
a non-compete pact in 2010, the Ambani brothers joined hands Tuesday with a
subsidiary of Mukesh Ambani's Reliance Industries Ltd signing a Rs 1,200
crore-deal with Anil Ambani's Reliance Communicatiaons Ltd (R-Com) to use its
optical fibre cable network. The RIL unit, Reliance Jio Infocomm
Ltd, will ride on the R-Com network across the country to provide the backbone
for its upcoming 4G service launch. The pact is not only the first major
tie-up between the brothers' companies after they resolved their feud and ended
their non-compete pact in May 2010, it is also the first business deal between
them since they split in 2005. The companies Tuesday said they could
cooperate further in the future, including mutually utilising towers and other
related assets. The announcement sparked a rally in their shares, with the
R-Com stock surging as much as 17 per cent and closing 11 per cent higher on
the BSE. Other Anil Ambani group stocks also saw a rally. The RIL stock closed
up 2 per cent. "This agreement is the first in an intended
comprehensive framework of business cooperation between Reliance Jio Infocomm
and Reliance Communications to provide for optimal utilisation of the existing
and future infrastructure of both companies on reciprocal basis, including
inter alia, inter-city fibre, intra-city fibre, tower and related assets,"
R-Com said in a statement. Reliance Jio "will utilise multiple fibre
pairs across R-Com's 1,20,000-km inter-city fibre optic network to provide a
robust and future-proof backbone for rolling out its state-of-the-art 4G
(fourth generation) services," it said. With the government recently
approving norms allowing Reliance Jio to launch calling service using its 4G
spectrum, the company can also launch voice services in the future. Analysts
said the move would offer some relief for debt-laden R-Com, while it is likely
to help Reliance Jio hit the market faster than expected. "I would
wait for agreements that follows this deal. R-Com is looking to sell stake in
Reliance Infrastructure and, going ahead, RIL may buy stake in that company. If
that happens, R-Com will benefit in a big way out of the deal, as the money it
is getting out of the current agreement is a relatively small amount,"
said Ankita Somani, telecom analyst at Angel Broking. The agreement,
however, provides partial relief to R-Com, which had a debt of around Rs 37,360
crore until December 31, 2012. R-Com, the country's third-largest mobile-telecom
company with services in all 22 telecom circles, is reported to have been
looking at selling stake in its tower firm Reliance Infrastructure. The
company has also held discussions with various firms to lower its stake in the
under-sea cable firm Globalcom. After the brothers split their empire in
2005, Mukesh Ambani retained RIL while Anil Ambani got Reliance Communications
and other group business entities in sectors such as power and
infrastructure. The initial agreement between the brothers did not allow
them to compete directly against each other, which was amended in 2010. In the
same year, RIL bought 95 per cent in Infotel Broadband and renamed it Reliance
Jio Infocomm Ltd, which owned frequencies to provide broadband communication
services.
ICEBREAKER
FIRST significant collaboration between the
brothers' companies after the non-compete pact was scrapped in May 2010. Also,
first business deal between them since the 2005 split. COMPANIES said they
could cooperate further in future, including mutually utlising towers, related
assets. MARKET RALLY followed; R-Com shares surged 17%, closed 11% up on
BSE. Other ADAG stocks also rallied. RIL stock closed 2% higher. Source: Indian Express
NALCO
reported FY2013 production numbers
National Aluminium
Company Ltd (Nalco) Tuesday reported record sales of over Rs 7,200 crore and
foreign exchange earnings of Rs 3,400 crore for 2012-13 fiscal. According
to the company site, it had recorded net sales of Rs 6,500 crore and an export
turnover of Rs 2,569 crore in 2011-12. Besides, despite delay in renewal
of mining lease, the company has achieved the highest-ever bauxite production
of 54.19 lakh tonnes, against the previous best of 50.03 lakh tonnes achieved
in previous fiscal. At the same time, Nalco’s Alumina Refinery has
produced 18.02 lakh tonnes of alumina hydrate, which is an all-time record
against the previous best of 16.87 lakh tonnes achieved in
2011-12. However, during the year, the metal production of the company
slumped marginally from 4.13 lakh tonnes to 4.03 lakh tonnes, due to planned
shutdown of pot shells of the smelter. "Besides coal shortage, the
dwindling LME prices of metal, forced the company to cut down its production of
metal to some extent, said Nalco CMD Ansuman Das. "It was not commercially
viable to produce more metal using expensive imported coal," said Das
adding the net power generation by the company’s Captive Power Plant was 6,076
million units during the fiscal. Moreover, during the year, the company
sold 983,191 tonnes of alumina hydrate against 842,396 tonnes in 2011-12.
Aluminium export by the company also increased to 144,161 tonnes this year from
98,399 tonnes achieved in the last financial year. Source: Zeenews
MOIL
raises manganese ore prices by 9% for April-June quarter
State-owned manganese ore producer MOIL Ltd has hiked
prices by nine per cent across its product basket for the April-June quarter to
cash in on rising demand. "It
is to inform that in line with company's business practice of quarterly
revising the prices of manganese ore, the prices of each grade of manganese ore
has been increased for the quarter April-June, 2013 by 9 per cent over the
prices for Jan-March, 2013," MOIL said in a BSE filing. MOIL's Chairman and Managing Director G P Kundargi
attributed the hike to increased demand in the domestic market. It takes around
32 kg manganese ore to make one tonne of steel. The company has hiked the raw material prices in line
with increase in global rates, Kundargi added. MOIL Ltd, country's single largest manganese ore
producer with the capacity of producing 1.1 million tonnes, sells over 60 types
of products. The hike has been effected across the basket with effect from
April 1. Following the hike, price
of first grade lump manganese ore now stands at Rs 13,416 per tonne. Source: Business Standard
HC refuses relief to Mallya, banks free to sell
shares
In a setback to liquor baron Vijay
Mallya , the Bombay High Court today refused to restrain banks from
selling shares of United Spirits pledged as security against loans to
Kingfisher, apparently jeopardising his plans to complete stake sale to Diageo
and to revive the grounded carrier. “Ad-interim relief refused,” said Justice S
J Kathawala after hearing the banks and United Breweries Holdings, Kingfisher’s
parent company, which had filed the suit. The court order would mean that the
consortium of 17 banks would be free to sell shares of the subsidiary companies
of the UB Group which had been pledged with the lenders under an agreement in
2010. During the course of arguments, the banks informed the court that the
process of sale of shares had already begun. Their counsels informed the court
that after the borrower defaulted on repayment, it was decided to sell the
pledged shares as per the agreement between the parties. Even those banks which
are not part of the consortium have also started selling the shares, they said.
Birendra Saraf, Counsel for UB Group, told reporters that the banks had
informed that one crore shares of Mangalore Chemicals and Fertilisers, a
subsidiary of UB Holdings, pledged with the lenders, had already been sold.
“The deal was materialised today,” he said. He had told the court earlier that
23 lakh shares of companies, including United Spirits Ltd and Kingfisher
Airlines, were pledged in exchange for loans. Mallya-owned UB Holdings pleaded
in the suit that the banks be restrained from selling shares of United Spirits
Ltd (USL) and other companies collectively worth Rs 100 crore. The petition
sought a stay after State Bank of India sold a portion of USL shares recently,
prompting the Mallaya-owned group to move the high court for relief. The action
by the banks, led by SBI which is the lead lender to the airline with over Rs
1800 crore dud exposure, is seen as a big jolt to Mallya’s plans of reviving
the airline as well as completing the stake sale in USL to Diageo, announced
last November for over Rs 11,000 crore. The banks decided to sell shares of USL
after Kingfisher failed to repay their dues worth over Rs 7,500 crore since
January 2012. In February, the banks had decided to recall the loans to
Kingfisher by selling a portion of the collaterals with them which included USL
and Mangalore Fertilisers shares, Mallya’s Goa villa and also the Kingfisher
House in Mumbai apart from the brand kingfisher which was valued at over Rs
4,000 crore at the time it was pledged. Finance Minister P Chidambaram appeared
to support such a move when he last month asked state-run banks to take action
against rich promoters of ailing companies. “We cannot have an affluent
promoter and a sick company. Promoters must bring in money… We wish banks take
firm steps to recover non-performing assets,” Chidambaram had said after a
meeting with the bankers. While the consortium leader SBI has an exposure of Rs
1,800 crore to Kingfisher, Punjab National Bank has Rs 800 crore, IDBI Bank (Rs
800 crore), BoI (Rs 650 crore), Bank of Baroda (Rs 550 crore), United Bank of
India (Rs 430 crore), Central Bank of India (Rs 410 crore), UCO Bank (Rs 320
crore), Corporation Bank (Rs 310 crore), State Bank of Mysore (Rs 150 crore),
Indian Overseas Bank (Rs 140 crore), Federal Bank (Rs 90 crore), Punjab and
Sind Bank (Rs 60 crore) and Axis Bank Ltd (Rs 50 crore). The lenders hold 3.5
crore shares of USL as collateral which at today’s closing price is worth over
Rs 6,550 crore. More than 90 percent of promoters stake are pledged with
various banks. USL today closed at Rs 1859.80, down 1.5 percent on the BSE,
while Mangalore Fertilisers closed at Rs 39.30, up 20 percent and Kingfisher
closed Rs 8.71, up 4.06 percent on the BSE, whose Sensex rallied 176 points
today. Source: firstpost
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