Jet Airways board approves raising up to $300 m via NCDs

While the timeline of the fundraising has not been outlined, the move will help Jet Airways bring down its debt.

The board of Jet Airways  has given its nod to raise long-term finance of up to USD 300 million via redeemable preferential shares or non-convertible debentures (NCDs). The fundraising will be its largest after Etihad's USD 330-million investment in the airline.

While the timeline of the fundraising has not been outlined, the move will help Jet Airways bring down its debt.

Meanwhile, the airline has reported its first quarterly profit since 2012 on Friday, thanks to the sale of its frequent flyer business, but the airline continued to lose money once one-off gains were excluded.

Jet, which has struggled to make money amid fierce competition for fares and high operating costs, said net profit totalled Rs 69.8 crore in the three months to September 30 after it banked a Rs 305 crore gain from the sale of its Jet Privilege frequent flyer programme.

Excluding the sale, Jet, which is targeting a return to profitability by 2017, lost Rs 235 crore in the quarter, less than the Rs 833 crore it reported a year earlier after operating income rose and fuel costs fell.

Jet Airways stock price

On November 07, 2014, Jet Airways closed at Rs 251.45, up Rs 7.35, or 3.01 percent. The 52-week high of the share was Rs 354.40 and the 52-week low was Rs 203.50.

The latest book value of the company is Rs -196.11 per share. At current value, the price-to-book value of the company was -1.28.

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TRAI sets Nov 29 as deadline for porting out Loop customers

Loop Mobile's permit in Mumbai is expiring on November 29 as it did not purchase spectrum in February auction which was mandatory for continuing its operations.

Telecom regulator TRAI has fixed midnight of November 29 as deadline for subscribers of Loop Mobile to shift to other networks while retaining their numbers by using the MNP facility.

Loop Mobile's permit in Mumbai is expiring on November 29 as it did not purchase spectrum in February auction which was mandatory for continuing its operations.

The Telecom Regulatory Authority of India today directed Mobile Number Portability service provider "not to process the request for porting in respect of mobile telephone numbers belonging to Loop Mobile...as donor operator after 23:59:59 hours of 29th November".

It has also agreed to the demand of Loop Mobile of providing with bulk MNP codes to transfer its over 10 lakh customer base in Delhi before its licence expires on November 29. TRAI has allowed Loop Mobile to use an additional service provider code 'F' in addition to its existing code 'L' to enable it to generate more than 5 lakh codes at a time.

Telecom major Bharti Airtel  this week called off the deal to acquire business and assets of Mumbai-based Loop Mobile including subscribers for about Rs 700 crore, pending clearances by the Department of Telecom.

DoT estimates that Loop Mobile and its sister concern Loop Telecom owe about Rs 808 crore in spectrum and other charges to the government.

Bharti Airtel stock price

On November 07, 2014, Bharti Airtel closed at Rs 390.50, up Rs 5.20, or 1.35 percent. The 52-week high of the share was Rs 419.90 and the 52-week low was Rs 282.10.

The company's trailing 12-month (TTM) EPS was at Rs 27.40 per share as per the quarter ended September 2014. The stock's price-to-earnings (P/E) ratio was 14.25. The latest book value of the company is Rs 166.93 per share. At current value, the price-to-book value of the company is 2.34.

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Exchanges to suspend trading in Kingfisher, UB Engineering

In a major clampdown for non-compliance of Listing Agreement, top exchanges BSE and NSE today announced suspension of trading in shares of Kingfisher Airlines  and another group firm, UB Engineering , from next month.

Besides, the entire promoter shareholding of these companies have been frozen with effect from today itself. The action follows non-compliance to a Listing Agreement clause relating to timely preparation and disclosure of financial results by a listed company for two consecutive quarters. The results are required to be disclosed by listed companies on stock exchange platform for benefit of investors.

In separate circulars, BSE and NSE said that the trading would be suspended in securities of Kingfisher and UB Engineering -- both parts of crisis-hit UB group headed by Vijay Mallya -- with effect from December 1.

The suspension follows Sebi guidelines with respect to Standard Operating Procedure (SOP) for suspension and revocation of trading of shares of listed entities for non-compliance of the Listing Agreement that a listed company needs to follow pursuant to its shares getting listed and traded on a stock exchange.

Shares of Kingfisher, once touted as most luxurious airline in India, are currently trading below Rs 2 apiece and its market capitalisation now stands at just about Rs 150 crore. At one point of time, before financial troubles began and led to its grounding in October 2012, the company carried a market valuation of close to Rs 10,000 crore.

For the year ended March 2013, the carrier saw its net loss widen to Rs 4,301.12 crore. During that period, the gross income stood at Rs 683.46 crore. A consortium of 17 banks has an outstanding debt of about Rs 6,521 crore from the now-grounded carrier and outside the consortium, there are some other loans also.

In Kingfisher, promoters have just 8.54 percent stake, while public holding stands very high at 91.46 percent. The non-promoter shareholders include more than two lakh small investors, over 6,000 HNIs, over 2000 NRIs and 13 FIIs, among others.

Along with Kingfisher and UB Engineering, NSE has also announced trading suspension for securities of Varun Industries Limited on account of non-compliance with Clause 41 of the Listing Agreement for two consecutive quarters, that is quarter ended March, 2014 and June, 2014.

"Accordingly, the entire promoter shareholding of Varun Industries Limited, UB Engineering Limited and Kingfisher Airlines Limited shall be freezed with effect from November 7, 2014 till further notice."

"In case, Varun Industries, UB Engineering and Kingfisher Airlines complies with respective requirement/s including payment of fines on or before November 25, 2014 (five days before the proposed date of suspension), the trading in securities of the said companies will not be suspended," NSE said.

In UB Engineering, which has a market cap of about Rs 14 crore, public holds 59.26 percent stake while promoter group controls 40.74 percent.

In case these companies fail to comply with the provisions of the Listing Agreement on or before November 25, 2014, then trading in their shares would be suspended from December 1 and the suspension will continue till such time the company complies including the payment of fine.

After 15 days of suspension, trading in the shares of non-compliant companies would be allowed on Trade for Trade basis in on the first trading day of every week for six months, NSE said. BSE has taken similar action against 21 companies, including Kingfisher and UB Engineering.

Others include Nilachal Refractories , Linkson International , Secure Earth Technologies , Ratan Glitter Industries , Bheema Cements , Arvind International , Elegant Floriculture & Agrotech India , Pretto Leather Industries , UT Ltd , Arihants Securities Ltd , Raghava Estates and Properties , Tutis Technologies , Valuemart Info Technologies , Ontrack Systems , A von Corporation , Birla Pacific Medspa , Best & Crompton Engineering , Varun Industries  and Maestros Mediline Systems .

Kingfisher Airlines is already facing a close regulatory scrutiny over suspected lapses in its accounting practices and the Corporate Affairs Ministry is looking into possible violations of Companies Act.

The airline, part of Vijay Mallya-led UB Group, has been grounded for over two years now after being bogged down by huge and mounting losses.

The carrier is yet to submit its annual financial results for the 2013-14 period to the stock exchanges. In a filing to the BSE on August 26, the carrier had said that steps were being taken to appoint directors in order to comply with provisions of the Companies Act, 2013 and listing agreement with the stock exchanges.

"Thereafter, steps will be taken towards publishing the audited results for the year ended March 31, 2014 and for the quarter ended June 30, 2014," it had said.

Back in May, Kingfisher had informed stock exchanges that "there are hardly any employees attending office and the company is currently operating with skeletal staff making it difficult to audit and publish the results in time."

As part of the recovery process, banks in February last year decided to sell a portion of the collateral with them, including shares of its group companies United Spirits Ltd and Mangalore Chemicals & Fertilizers Ltd, Mallya's Goa villa, Kingfisher House in Mumbai and the Kingfisher brand, which was valued at over Rs 4,000 crore at the time it was pledged.

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South India emerges as property hotspot

South India has pipped the north and west when it comes to commercial real estate. From January to September, almost 50 percent of new office space deals were struck in Chennai, Hyderabad and Bangalore. Thanks primarily to the IT/ITeS sector, commercial real estate in south india is building new blocks towards recovery. Nayantara Rai brings you the findings of the latest report by international property consultant CBRE.

Chennai recorded a 50 percent quarterly growth in the July-September period, with some of the bigger transactions involving properties like the Prestige Palladium in the heart of the city, the DLF IT SEZ, approximately 5 km from the airport; and along the city's upcoming it corridor in Sholin-Ganallur where a contract research firm scope international signed up 96,000 sqft

What's also noteworthy is the appreciation in rentals, rising by 25 percent Y-o-Y and 15 percent-plus Q-o-Q in IT SEZs in localities like Velachary, Perungudi and Poonamallee Road. A similar trend is panning out 20 km away from Chennai's city centre at the upcoming it corridor. CBRE concedes this is not sustainable.

Anshuman Magazine, CMD - South Asia, CB Richard Ellis, said: "This may not be sustainable but the fact is we do expect in some of the areas where the supply is limited and some improvement in demand happens there could be marginal increase in rentals."

With the end of the political crisis that had paralysed Hyderabad's property market, CBRE has observed a revival, albeit a gradual one from corporates, especially those from the IT sector and back-end offices for financial services. The action is not so much in the popular Banjara and Jubilee Hills, but in the established it corridor of HiTec city and Gachibowli, where rentals have been slowly inching up.

CBRE says Hyderabad has the potential to emerge as the preferred office destination of corporates. But for that, the city's cheaper and upcoming it corridor—comprising Kukatpally, Manikonda and Nana-Kramguda--have to remain competitive against Bangalore, Chennai and Pune.

India's IT capital Bangalore is still the country's largest office market. A few of large deals inked in the July-September quarter include Mercedes Benz and TCS in Whitefield; Bosch at Sarjapur Marthahalli in Outer Ring Road; Accenture at Mysore road and Wipro again at the Outer Ring Road. These are the future growth corridors identified by CBRE.

"The place to watch out is North Bangalore. We are seeing lot of activity, new special economic zones coming in, airport being in close vicinity, I think in next couple of years North Bangalore will see quite a bit of activity," Magazine said.

And prospects for Bangalore remain bright. In India's largest leasing transaction e-tailing giant Flipkart has signed on the dotted line for a 3 million square foot custom-built campus from local builder embassy. The deal is pegged at Rs 85/sqft. Accenture is believed to be on the lookout for another 1 million sqft.

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Time ripe for US-based cos to invest in India: NRN Murthy

Murthy, who founded Infosys in 1981 with USD 1,150 and grew it into a market capitalisation of USD 38.6 billion, said that he expected the company to continue its upward trajectory.

Time ripe for US-based companies to invest in India.In fact, some of the largest projects that most Indian software companies are doing are in India.

NR Narayana Murthy

Founder member

Infosys

N R Narayana Murthy, the billionaire founder of Infosys, said Thursday that he expects robust growth ahead for India.

"I think there are opportunities outside India, as well as in India," he said. "In fact, some of the largest projects that most Indian software companies are doing are in India."

On CNBC's "Fast Money," Murthy expressed faith that Narendra Modi, India's new prime minister, would lead the country toward creating a more business-friendly climate.

"Till now we had coalition governments," he said. "But this time we have a government which has absolute majority in the parliament. He's also a man of action. He has enunciated a program called digital India where he wants to bring the power of Internet and broadband communications to the benefit of every Indian."

Read More: Investor goes from hedge fund manager to franchisee

Murthy said the time was ripe for US-based companies to invest in India.

"Therefore, I think this is the right time for American companies to add even more value to India," he said. "Already, we have almost every high-tech company there. We have GM. We have Ford. We have lots of American companies there, but we need even more of them because they bring a lot of value to our economy."

Murthy, who founded Infosys in 1981 with USD 1,150 and grew it into a market capitalization of USD 38.6 billion, said that he expected the company to continue its upward trajectory.

Read More: Who's not on the CNBC NEXT List?

 "There is opportunity in India as well opportunity outside of India because right from Day One, we leveraged the part of globalization which is all about sourcing capital from where it is cheapest, sourcing talent from where it is best available, producing where it is most cost-effecting and selling where the markets are without being constrained by national boundaries," he said. "That's how I define globalization, and my company was based on that principle."

Murthy was named No. 13 on the CNBC First 25 List of visionary leaders who shaped the world of business and finance since 1989, the year CNBC started.

Infosys stock price

On November 07, 2014, at 14:10 hrs Infosys was quoting at Rs 4169.35, up Rs 43.35, or 1.05 percent. The 52-week high of the share was Rs 4175.00 and the 52-week low was Rs 2894.00.

The company's trailing 12-month (TTM) EPS was at Rs 203.80 per share as per the quarter ended June 2014. The stock's price-to-earnings (P/E) ratio was 20.46. The latest book value of the company is Rs 733.03 per share. At current value, the price-to-book value of the company is 5.69.

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Ranbaxy loses Valcyte exclusivity: An analysis

Ranbaxy has informed the stock exchanges that the USFDA has revoked tentative approvals granted for generic versions of two drugs - AstraZeneca's heartburn drug Nexium & Roche's antiviral drug Valcyte.

Ranbaxy has first-to-file status, meaning eligibility for six months of generic sales exclusivity for both these drugs. However, the final approvals for these drugs were delayed because of the compliance issues at Ranbaxy's plants.

FDA has said that its original decisions granting tentative approvals were 'in error' because of the compliance status of the facilities referenced in the ANDAs at the time the tentative approvals were granted. As a consequence, in FDA's view, Ranbaxy has forfeited its eligibility for 180-day exclusivity for generic Valcyte.

The USFDA however, has not disclosed the reason for rescinding the tentative approvals. The agency told CNBC TV18 that FDA is prohibited by law from disclosing information about an unapproved application.

But does this mean all opportunities lost for Ranbaxy?

There are two parts to this.

Valcyte is a certainly a missed opportunity for Ranbaxy with the revocation of the tentative approval and a categoric mention of forfeiture of exclusivity. Valcyte is a USD 400 million drug, and analysts were anticipating Ranbaxy had an opportunity to earn USD 60-70 million in the exclusive sale period. This is now lost. It however means positive for other ANDA applicants like Dr Reddys Labs , Cipla, Endo, Aurobindo & Mylan, who have been waiting in line.

USFDA spokesperson told CNBC TV18 that this week ANDAs filed by Endo and Dr Reddys have been approved by the agency. This means Endo & Dr Reddys would be the first entrants, opening the US market for generic versions of valgancyclovir, a drug that lost patent protection in March 2014.

The second part of this story deals with the bigger opportunity of the USD 2.2 billion drug Nexium, which went off patent in May 2014. While tentative approval for this drug granted to Ranbaxy has being rescinded by the USFDA, the agency has not clarified if this exclusivity is also forfeited. This has opened a window of scepticism.

Some analysts say a revocation of temporary approval in turn means revocation of the exclusivity for Nexium as well. And if that is the case then, it will be big opportunity miss for Ranbaxy. It is anticipated that Ranbaxy could garner nearly USD 180 million in sales in the six months exclusivity period. These exclusive drug opportunities have been the pillar of hope for the troubled drug maker.

Remember, during the Q2 earnings call last month, Ranbaxy CEO Arun Sawhney had said that the company believes it retains exclusive rights to the launch of Nexium in the United States.

Ranbaxy, which is awaiting statutory approvals for a merger with country's biggest drug maker Sun Pharmaceuticals , has refrained from providing further clarity. The company just says it was disappointed with the development and was evaluating options to "preserve its rights."
However, some other analysts read it differently. They say the approval revocation, in Nexium's case, relates to procedural requirements.

Since, USFDA has banned Ranbaxy's only API facility at Toansa, the company has reportedly re-filed ANDA with a renewed API source for generic Nexium. Reports say that application is currently under review with the FDA.

HSBC Securities in a report said, "The tentative approval for old ANDA filing had anyway become immaterial and hence cancellation of that approval doesn't impact gNexium FTF status. In fact, we believe Ranbaxy is moving closer with approval of ANDA from new API source and hence remain positive on gNexium launch in few months."

But could that be a plausible explanation?

Four of Ranbaxy's Indian facilities have been banned by the USFDA. The company, in order to secure its opportunities, has in the past also sought for site transfers for other drugs. For example, atorvastatin and valsartan, among others. However, this is the first time that USFDA has sought to rescind a tentative approval, indicating a bigger issue at hand.

Interestingly, while not disclosing the reason for revocation of the approvals, the FDA in its statement to CNBC TV18 said, "In rare circumstances, FDA has rescinded a Tentative Approval."

Does Ranbaxy still hold exclusivity on Nexium? Could this mean there are more compliance issues at Ranbaxy's sites? Has the company been unsuccessful in seeking a site transfer for these drugs? Or more importantly, could the fine print at Consent Decree signed in 2012 be at play, one which demands more exclusivity forfeitures if remediation process is not satisfactory?

Shareholders would be keenly looking out for Ranbaxy to answers these questions.

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Dr Reddy's, Endo get FDA approval to launch generic Valcyte

The US Food and Drug Administration (FDA) said it has granted final approval to Indian drugmaker Dr Reddy's Laboratories and US firm Endo International Plc to make cheaper copies of Roche Holding AG's antiviral Valcyte.

The US Food and Drug Administration (FDA) said it has granted final approval to Indian drugmaker  Dr Reddy's Laboratories  and US firm Endo International Plc to make cheaper copies of Roche Holding AG's anti-viral Valcyte.

The move comes after  Ranbaxy Laboratories Ltd said on Thursday that FDA had stripped the company of its tentative approval to launch the first copy of the drug due to quality control issues at its manufacturing plants.

Ranbaxy, whose all India-based manufacturing plants have been banned by the FDA from exporting to the United States, also lost its rights to a six-months market exlusivity for Valcyte generic.

There are no companies with such sales exclusivity for Valcyte generic anymore, FDA spokeswoman Sandy Walsh said in a statement mailed to Reuters.

A spokeswoman for Dr Reddy's did not immediately respond to a request for comment on Friday. Endo could not be reached outside the US business hours.

Dr Reddys Labs stock price

On November 07, 2014, at 14:10 hrs Dr Reddys Laboratories was quoting at Rs 3409.00, up Rs 155.80, or 4.79 percent. The 52-week high of the share was Rs 3455.00 and the 52-week low was Rs 2250.00.

The company's trailing 12-month (TTM) EPS was at Rs 125.08 per share as per the quarter ended September 2014. The stock's price-to-earnings (P/E) ratio was 27.25. The latest book value of the company is Rs 547.59 per share. At current value, the price-to-book value of the company is 6.23.

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Ashok Leyland back to profit by focusing on lowering debts

The Chennai-based heavy commercial vehicle maker had registered a net profit of Rs 120.69 crore for the July-September 2014 period as against a net loss of Rs 25.05 crore registered during the same period of previous year.

Focus on reducing working capital, lowering debt and increase in sales in the first six months of the current financial year led Hinduja Group flagship company  Ashok Leyland to strengthen its bottom-line, a top company official said.

"We have been sharply focused on reducing working capital and lowering debt. Healthier sales realisations have helped strengthen our bottom-line and not only have we gained market share, we have returned to profitability after five successive quarters", Ashok Leyland Managing Director Vinod K Dasari said in a statement.

The Chennai-based heavy commercial vehicle maker had registered a net profit of Rs 120.69 crore for the July-September 2014 period as against a net loss of Rs 25.05 crore registered during the same period of previous year.

For the six month period ending September 30, the net profit stood at Rs 72.73 crore as against a net loss of Rs 166.80 crore. The company sold 28,290 vehicles during the six month period ending September 2014, from 26,927 units sold during the corresponding period of previous year.

It increased market share in medium and heavy commercial vehicles to 27.1 percent while operations in the overseas market grew by 25 percent, the statement added.

Ashok Leyland stock price

On November 07, 2014, at 14:12 hrs Ashok Leyland was quoting at Rs 47.70, up Rs 0.95, or 2.03 percent. The 52-week high of the share was Rs 49.00 and the 52-week low was Rs 14.90.

The company's trailing 12-month (TTM) EPS was at Rs 0.43 per share as per the quarter ended June 2014. The stock's price-to-earnings (P/E) ratio was 110.93. The latest book value of the company is Rs 15.69 per share. At current value, the price-to-book value of the company is 3.04.

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Govt to further deliberate on tax demand against MTNL

MTNL has already made this payment of Minimum Alternate Tax (MAT), amounting to Rs 492 crore, and had sought relief from the government, which holds 56.25 percent stake in this publicly listed firm.

Government has decided to further deliberate on the issue of tax demand against loss-making MTNL , which had arisen due to a decision to provide pension support and refund of broadband spectrum payments to the state-run telecom firm.

MTNL has already made this payment of Minimum Alternate Tax (MAT), amounting to Rs 492 crore, and had sought relief from the government, which holds 56.25 percent stake in this publicly listed firm.

"Cabinet considered MTNL issue. We have taken a call on it. There was a tax demand and we have accepted that. The loss to MTNL was because of book value. We have not deferred the matter, but further deliberations are required," Telecom Minister Ravi Shankar Prasad told reporters after a Cabinet meeting this evening.

Government in September last year decided to refund about Rs 5,700 crore to MTNL which it has to pay for wireless broadband spectrum in Delhi and Mumbai in 2010.

In December 2013, the government also approved pension support to MTNL for about 43,000 employees who joined the state-run firm from Department of Telecom.

MTNL stock price

On November 05, 2014, Mahanagar Telephone Nigam closed at Rs 31.10, up Rs 1.00, or 3.32 percent. The 52-week high of the share was Rs 39.10 and the 52-week low was Rs 13.00.

The company's trailing 12-month (TTM) EPS was at Rs 132.51 per share as per the quarter ended June 2014. The stock's price-to-earnings (P/E) ratio was 0.23. The latest book value of the company is Rs 80.01 per share. At current value, the price-to-book value of the company is 0.39.

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See $250 bn investment in power sector in 4-5 yrs: Goyal

As India grapples with power shortage problems, Power Minister Piyush Goyal is expecting an investment of USD 250 billion in the next four to five years. Speaking at World Economic Forum's India Economic Summit 2014, the minister said renewable energy will be a feed-in for power sector and government will engage top 250 tax payers to invest in solar and wind projects.

The investments, totaling USD 250 billion for power generation, coal mining as well as electricity distribution and transmission sectors, would help the government increase power generation and ensure electricity supplies to all households in the country by 2019, Goyal said.
"We are expecting around USD 250 billion investments in the next four to five years... About USD 100 billion will be in the renewable energy," Goyal said.

The country's electricity transmission segment is anticipated to see an investment of around USD 50 billion during this period, he added.Stating that power is going to drive the economy, Goyal said that government will focus on long-term bankable Power Purchase Agreement (PPAs) for renewable energy. He expects power demand to double in next five years.

Goyal also stressed that there is a need to increase utilisation of current and stranded power projects while private sector will have an important role in enhancing coal production in India.
The government is pushing ahead with ambitious plans for the renewable sector, especially solar energy, where the generation capacity is to be increased to 1,00,000 MW by 2022, he added.

The government is sincere in its efforts and "will protect investments", the Minister said. To meet the increasing electricity generation requirements, Goyal said, Coal India is expected to double its production to around one billion tonnes by 2019.

The private sector is also expected to play an increasing role in the coal sector and an ordinance issued recently by the government addresses many of the issues, he said. The ordinance related to the coal sector came after the Supreme Court cancelled a large number of coal block allocations.

About 53 million homes in the country are yet to get electricity and many industries depend on diesel generation sets to meet their requirements.

According to Goyal, all households are expected to have electricity access by 2019. In the renewable space, the government expects to nearly double the installed wind generation capacity to more than 40,000 MW by 2019, he said, adding that the government is pursuing the strategy of improving the utilisation of existing assets and freeing up stranded assets.

Efforts are also on to improve the bankability of power projects, he added.

India has an installed power generation capacity of over 2,50,000 MW but many plants are facing fuel supply problems resulting in lower production. Besides, many other issues such as hurdles in getting clearances and poor financial health of power distribution companies are adversely impacting the power sector.

Responding to a query on the health of electricity grid, Goyal said steps are in place to ensure its stability, including heavy penalties for erring entities.

(With additional inputs from PTI)

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Kol, Chennai airports dropped off privatisation map: Source

It is almost certain.  Two of the biggest airports, at Kolkata and Chennai, have been dropped off  Government's privatisation map. CNBC-TV18's Sindhu Bhattacharya reports quoting sources that the much delayed consent of the Government on developing and modernising some airports under the Public Private Partneship (PPP) model may come next week but instead of the earlier six airports, the list may be pruned to four.

"Kolkata and Chennai airports have already seen huge investments by the Airports Authority of India but continue to be poorly managed. In all likelihood, these two airports will not be on the PPP map," the source said.

State-owned AAI is the biggest owner and operator of airports in India. The four airports expected to get a nod for PPP route to modernisation are those at Jaipur, Lucknow, Guwahati and Ahmedabad.

The PPP model being considered now is different from previous models (such as those adopted for Delhi and Mumbai airports) because neither the state and nor the state-owned AAI are to hold any equity stake this time. The airports will be handed over entirely to private parties. In India, all greenfield airports have traditionally been developed by the AAI. The six identifed airports were to become the first such airports where private parties would have been able to acquire 100% equity on a 30-year lease basis, with no AAI participation.

But with Kolkata and Chennai possibly out of the PPP kitty, other problems may arise. Large airport developers like GVK, GMR and others have been keen on participating in the privatisation process till now but will they come forward if two largest airports are not on the table?

An official at a large airport developer had said earlier traffic potential will have to be assessed at the remaining four airports but first, the Government needs to get the model concession agreement and the regulatory framework for revenue sharing model right. A consultant closely associated with the airport privatisation process has said earlier that if Chennai and Kolkata are excluded, the entire privatisation process could be a washout since private sector interest in smaller airports would be minimal.

Some officials in the Government see things differently though. According to them, Ahmedabad and Jaipur should hold enough interest for private bidders since the first is a business hub and the second a tourist hub. There were some reports earlier of Prime Minister Modi exhorting a major port developer from Gujarat to come forward and take the contract at least for Ahmedabad airport, which is expected to have good traffic potential.

Why is the Government hesitant on going the whole hog with a PPP model? A senior official in the ministry of civil aviation had earlier pointed out that the experience with privatisation till now has not been all pleasant. Five of India's largest airports are being run by consortia of private players with AAI working alongside as per a revenue sharing formula. These are Delhi, Mumbai, Bengaluru, Hyderabad and Cochin.

At one of these five airports, the cost of turnaround of a wide body aircraft is USD 6000. This is how much it costs an airline for landing the aircraft, paying for its parking, unloading etc. At the world famous Singapore airport, the same services would cost an airline just USD 2300. Officials in the Ministry of Civil Aviation have been questioning private developers charging airlines and flyers exorbitantly. A senior ministry official has said earlier that such exorbitant charges of private airports in India are bothering airlines and this will be a big consideration in awarding future airport contracts to private developers. The official had also said that the Planning Commission has circulated a new model concession agreement (MCA) with changes. Airport privatisation has been stuck for many months - the process was first initiated during the UPA2 tenure.

At that time, the Planning Commission was pushing for a tariff model which prospective bidders found unviable. The Planning Commission wanted a cap on user fee: basically a model followed by the roads sector where the user fee or toll is pre-determined though allowed an annual small increase. But private airport developers wanted user fee to be determined by costs of the project and did not want any fixed amount. This meant the PPP process and subsequently model concession agreements were interminably delayed.

Sources tell us it is now possible that the second formula, where user fee varies according to project cost and investments sunk into it, will be offered in revised MCAs.
 

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Telecom industry needs more spectrum: Mittal

Bharti group Chairman Sunil Mittal today said the telecom industry wants more spectrum and the government should make it available.

"We want from the government more spectrum. Every country has the same amount of spectrum and it is not that India has less... It needs to be vacated from other places, that is what other countries have also done," Mittal said on the sidelines of the India Economic Summit here.

Telecom Regulatory Authority of India, on October 15, gave its recommendation on spectrum auction for premium 900 Mhz band and 1800 Mhz band that are presently being used for 2G GSM mobile services by Airtel , Vodafone, Idea Cellular and Reliance Communications.

Government has proposed to put for auction about 184 Mhz of spectrum in 900 Mhz band which is held by these companies through their various licences expiring in 2015-16. The four telecom operators will have to buy spectrum afresh to continue their services.

"I would say government should make available enough spectrum so that there is a balance between spectrum pricing" he added.

On being asked if the spectrum auction -- scheduled for February 3 -- should be deferred, Mittal said: "Why should this be deferred. Industry wants more spectrum and the government should make it available to them."

On Bharti Airtel calling off the Rs 700-crore deal to acquire business and assets of Mumbai based Loop Mobile, he said much is being read into this. "Loop mobile is a small issue and I don't know why this is being made into such a big issue. Most of the Loop subscribers have ported to us. It was a small deal, which was basically an experiment for the first time to acquire
customers.

"Its not about the merger but about the renewal of the agreement," Mittal said. Airtel, in a filing to BSE, had said its proposed transaction related to Loop was conditional upon DoT approvals which had not been received till date.

DoT is yet to give clearance to the proposed deal as in estimates that Loop Mobile and its sister concern Loop Telecom owe about Rs 808 crore in spectrum and other charges to the government. Private sector lender Axis Bank has also told the DoT that Rs 215-crore loan to Loop Mobile will be at risk if the deal of the Mumbai-based operator to sell its assets to Bharti
Airtel is not approved.

Airtel had signed the deal with Loop in February this year to buy business and assets of Loop Mobile in Mumbai under a strategic agreement for about Rs 700 crore. Under the agreement, Loop Mobile's 3 million subscribers (at that time) in Mumbai were supposed to join Airtel's over 4 million subscribers, which would have made it the largest network in the metropolitan city.

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Jet expands international services; boosts Gulf link

Private carrier Jet Airways  today expanded its international operations with launch of services to Vietnamese commercial hub, Ho Chi Minh City via Bangkok and additional flights to the Gulf.

The enhanced frequencies from Mumbai to Doha, Colombo and Bangkok will provide guests with the convenience of an additional service, Jet Airways said in a release.

The rollout of a third daily direct service from Mumbai to Bangkok will provide onward connectivity to Ho Chi Minh City from Thailand capital (Bangkok), it said.

The new afternoon service will make Jet the only Indian carrier to operate three flights a day from Mumbai to Bangkok's International Suvarnabhumi Airport as well as providing onward connections to Ho Chi Minh City from the Thai city, the private carrier said.

Passengers from Mumbai will now have the option of connecting to Ho Chi Minh City and to several destinations of their choice in ASEAN region while they transit over Bangkok, the airline said.

The addition of a second frequency from Mumbai to Doha will further strengthen Jet's growing international network and significantly enhance connectivity in the Gulf region, thus complementing the existing flights on the sector.

Doha is currently served by one flight each from Mumbai, Delhi and Kochi. The new flight on this high demand route will not only cater to the growing Indian expatriates but also boost tourism and trade and help in bringing in traffic to and from West Asia, the carrier said.

"Jet Airways is delighted to introduce these additional frequencies from Mumbai to Doha, Colombo and Bangkok that will afford its customers the convenience of seamless travel and unmatched flight options," Senior Vice-President (Commercial) Gaurang Shetty said.

With these new flights, Jet will become the first private airline in India to operate over 40 daily flights to multiple destinations in the Gulf, the release said.

Jet operates daily flights to Abu Dhabi, Bahrain, Dubai, Doha, Kuwait, Sharjah, Muscat, Jeddah and Riyadh, making it the largest operator between India and the Gulf.

Besides adding flights to Gulf, Jet has introduced a second direct service on the Mumbai-Colombo-Mumbai sector, providing onward connections to Dubai and Abu Dhabi to the Gulf, Bangkok, Singapore and Hong Kong in the Far East and to North America via Brussels and London Heathrow with direct and codeshare flights, it said

Jet Airways stock price

On November 05, 2014, at 14:14 hrs Jet Airways was quoting at Rs 248.00, up Rs 7.55, or 3.14 percent. The 52-week high of the share was Rs 357.50 and the 52-week low was Rs 203.50.

The latest book value of the company is Rs -196.11 per share. At current value, the price-to-book value of the company was -1.26.

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Ready to monetise 25-30 acres near Delhi airport: GMR Infra

GMR Infra is one of few infra companies which has managed to meaningfully pare down debt via its Asset Light – Asset Right Model. It has sold stake in a number of its assets and is now getting ready to monetise 25-30 acres of land around Delhi airport, says Madhu Terdal, GMR Infra, in an exclusive interview on CNBC-TV18.

Since the government has considered making changes to Land Act to boost private public partnership or PPP projects, the beleagured infrastructure sector has sprung back to life. GMR Infra , which has fallen over 11 percent YTD, is said to benefit if PPP is exempted from consent clause. The proposed changes to Land Act puts the onus of social and environmental study on to states.

Speaking to CNBC-TV18, Terdal said the company won't be immediately impacted by positive reforms but government's PPP initiatives will help stranded road and power projects. The company's joint venture with Philippines Airport will start making profits from this year and will add around Rs 110 crore in revenue.

Below is the transcript of Madhu Terdal's interview to CNBC-TV18's Latha Venkatesh and Sonia Shenoy

Sonia: How much of a positive this could actually be for the industry and for GMR Infra?

A: For the industry as such of course it will be very positive news but its immediate impact will be quite minimal because most of the infrastructure projects are now suffering because of lack of raw material, coal and also the availability of finance itself. Most of the projects have been completed 80-90 percent and I don't think any infrastructure developer is in a mood to start off new projects immediately.

Of course some of the road projects which have been stranded for want of a small last mile availability of the land, definitely it will be a very beneficial thing.

Couple of things that really distorted the whole thing in the Land Act, they introduced a consent clause whereby we require 85 percent of the people who are being affected. So that was one very difficult clause for the developer to obtain. Now that is likely to be reduced to something around 50 percent or so, the final word is yet to be told on that.

Secondly it was also made with retrospective effect for example if we are developing urban infrastructure where we have already got 1000 acres if I am going to acquire only five acres intermittent land, the whole clause will be applicable and even R&R provisions - in most of our cases we have completed our R&R provisions. So if we have to reopen the whole thing it is going to be adversely affected. Of course we are not really actively considering any investment into this area immediately. So as a group we are not really going to get much impacted but definitely in the urban infrastructure space where we are developing couple of projects but they are couple of years away, we are going to have a beneficial impact.

Latha: We understand that your joint venture with Megawide Construction has now got full control over the Philippines airport, the Cebu Airport. Tell us what this means to your own P&L? How should your investors rejoice?

A: First of all it is going to add profit from the very first year itself. Now we have got another five months to go.

Latha: So this is a constructions contract or a maintenance contract?

A: It is a 25 years PPP project so totally the concession is for 25 years. The best part is the whole process is done in less than 18 months from end to end that is the first thing. We were awarded the reward only in April 2014 and in less than six months time we have taken over even the operation despite that we had faced certain legal challenges in the government. Despite that we have already about two days before the midnight of day before yesterday we have already taken charge of the operations. In a normal one year I think this coming full year only 40 percent we will be accruing to us. So we will be adding around Rs 110 crore of revenue but the EBITDA levels are as high around 75 percent. So this year alone revenue wise we will be adding totally around USD 44 million for full year. But the remaining five months alone, we will be adding close to around Rs 105 crore on the revenue but EBITDA will be almost Rs 80 crore.

Watch video for full interview

GMR Infra stock price

On November 05, 2014, at 14:10 hrs GMR Infrastructure was quoting at Rs 22.70, up Rs 0.10, or 0.44 percent. The 52-week high of the share was Rs 38.30 and the 52-week low was Rs 17.20.

The company's trailing 12-month (TTM) EPS was at Rs 0.21 per share as per the quarter ended June 2014. The stock's price-to-earnings (P/E) ratio was 108.1. The latest book value of the company is Rs 16.76 per share. At current value, the price-to-book value of the company is 1.35.

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Supplies from Sharda mines hinge on environment nod: JSPL

Ravi Uppal, managing director and CEO of JSPL says the plants are being run based on the inventory of iron ore lumps that it had, along with the supplies it is getting from the Tensa mine.

The second quarter results of  Jindal Steel & Power were broadly inline with estimates. Topline came in slightly lower because they deducted captive sales from revenues while margins were slightly higher as operating profit was taken on lower sales.

Ravi Uppal, managing director and CEO of JSPL gave some clarity on its Sharda Mines. He says the plants are being run based on the inventory of iron ore lumps that it had, along with the supplies it is getting from the Tensa mine. It is also sourcing from the neighbouring producing mines.

"When we will get supplies from SMPL will depend on environment clearance. We do not see any reason whatsoever for that mine not to get the environment clearance because the Expert Appraisal Committee (EAC) had given clearance to it in September," he says. However, he refrained from giving exact dates.

On the performance of its first four units of 250 MW, he says the performance has been a repeat of last year. The units have done very well, he adds. Jindal Power Limited (JPL), a subsidiary of Jindal Steel & Power Ltd. (JSPL), has set up a 1000 MW power plant of four units of 250 MW each, the first of which commenced commercial operation in December 2007.

Uppal says a bigger challenge for the company at the moment is making sure that all four units of 600 MW at its Tamnar Phase II project become operational. At the moment, two such units are running. "I am just hoping that before the financial year comes to an end, for the phase II, we should have PPAs for at least about 1,100-1,150 MW of capacity. And then we are going to start focusing on unit number three and four. And there once again we will try for PPA or initially we will be selling the power on a merchant basis," he told CNBC-TV18.

Jindal Steel stock price

On November 05, 2014, at 14:13 hrs Jindal Steel & Power was quoting at Rs 165.30, down Rs 4.85, or 2.85 percent. The 52-week high of the share was Rs 350.00 and the 52-week low was Rs 128.00.

The company's trailing 12-month (TTM) EPS was at Rs 14.86 per share as per the quarter ended September 2014. The stock's price-to-earnings (P/E) ratio was 11.12. The latest book value of the company is Rs 142.79 per share. At current value, the price-to-book value of the company is 1.16.

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Merged Welspun Proj to be profitable in FY15: MD Garg

Sandeep Garg, managing director,  Welspun Enterprises says the company's merged entity  Welspun Projects is expected to be profitable in FY15.

Speaking to CNBC-TV18, Garg says that after this merger, every Welspun Enterprises holder will get 12 sharers of Welspun Projects.

The company has merged Welspun Enterprises, Welspun Infratech, Welspun Plastics, Welspun Infra Projects and Welspun Projects on the recommnetdation of its audit committee.

According to the company's statement the merger will aid capitalise the market opportunities with a consolidated cash of Rs. 800 crore.

Below is the verbatim transcript of Sandeep Garg's interview with Latha Venkatesh and Ekta Batra on CNBC-TV18.

Latha: Can you just take us through what is merging into what?

A: We demerged the Welspun Corp and an entity was formed which was called a mirror image of Welspun Corp as Welspun Enterprises. Under it we had various layers which included Welspun Infratech, Welspun Infra Projects, Welspun Projects Limited. There were various layers within the enterprises and we decided to streamline the whole organisation to gain some fiscal benefits as well as streamlining the operations and accordingly we decided to merge all the entities into Welspun Projects which is the operating company.

Latha: So now Welspun Enterprise and Welspun Projects are both listed. What is the swap ratio?

A: The swap ratio for every share of Welspun Enterprises, the shareholders will get 12 shares of Welspun Projects.

Ekta: Can you give us a sense that after the merger process takes place what will the balance sheet as well as the P&L look like?

A: The balance sheet of the merged entity should be about Rs 2,000 crore approximately. The numbers are still being worked out and in terms of the profitability because these two entities Welspun Enterprises and Welspun Projects are in entirely different arena we expect the entity to break even on the financial year basis.

Ekta: On EBITDA or profit level?

A: At the profit level, at Profit Before Tax (PBT) level.

Latha: Welspun Projects will be the listed stock?

A: Yes, that will be the surviving entity.

Latha: And at the moment they are not both in the black, Welspun Projects and Welspun Enterprises?

A: No, Welspun Projects has made some losses in past.

Latha: The last reported was not a profit, there is a Rs 1 crore profit for the June quarter?

A: Yes, Q1 was profit but as a whole year indication is it will not remain profitable.

Latha: So will the merged entity in FY15 itself be profitable?

A: Yes, it will be breaking even.

Ekta: Can you give us a sense on why are you doing this?

A: There are two reasons that we decided to do it. First was that it gave us a fiscal benefit. Secondly it gave us operational efficiency. There was enough cash trapped within the various entities and there was about Rs 800 crore trapped in with various entities which is something which we want to consolidate and really play for the larger businesses rather than playing with very small balance sheet on smaller businesses on a standalone basis. So that was the purpose which drove us to consolidate.

Latha: Will there be any further changes to  Welspun Corp or Welspun India?

A: At this point in time no. We are contemplating no further corporate actions on those two entities.

Latha: Which one of this is more export dependent of all your listed stocks?

A: Welspun India is the most export oriented and then comes the Welspun Corp. Both are very export oriented.

Latha: This is largely an infrastructure company, Welspun Enterprises?

A: Yes, we are into infrastructure, oil and gas and we were in steel, we recently sold the Maxsteel. So this is the whole restructuring that we are doing in the group to get out of the businesses.

Ekta: Any other hiving off of businesses or maybe any other sort of inorganic plans either way which is lined up for the company?

A: At this point in time we are not thinking of any hive offs from the group. We have structured ourselves reasonably lean and mean at this point in time and fit for the businesses that we want to target. With the cash availability on the consolidated entity we

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Are DDA flats losing charm?

The Delhi government's biggest housing scheme sees a tepid response. Prime Property finds out why?

The Delhi government's biggest housing scheme sees a tepid response. Prime Property finds out why?

Watch videos for more...

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Airtel to hike post-paid rentals by about 12% from Dec

Last week, Bharti Airtel had reported nearly three-fold jump in consolidated net profit at Rs 1,383 crore for the September quarter on growth in mobile data revenues.

Country's biggest telecom operator Airtel has announced an increase in its post-paid monthly charges by about 12 percent in select plans, effective December.

"Eff. (effective) 3-Dec 2014, bill plan rental for your airtel mobile will be revised from Rs 199 per month to Rs 224 per month," Airtel said in a message to its customers.

Industry sources said Airtel has increased rates across low rental plans. Queries send to Airtel did not elicit any immediate reply.

Airtel has a mobile subscriber base of over 20 crore customers, which include both pre-paid and post-paid users.

Last week, Bharti Airtel had reported nearly three-fold jump in consolidated net profit at Rs 1,383 crore for the September quarter on growth in mobile data revenues.

This is the second hike in rates of telecom services by the company within a period of three months. In September, the company had increased mobile internet rates by up to 33 percent and reduced benefit under plans for its pre-paid customers.

An increase in telecom services rates has become more frequent since the last two years after a number of players in the market came down following cancellation of mobile licences by the Supreme Court in 2G spectrum case.

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Oil cos' losses on sale of LPG, kerosene up 35%

State-owned fuel retailers are losing Rs 27.60 on sale of every litre of kerosene through the Public Distribution system (PDS) and Rs 393.50 per 14.2-kg domestic cooking gas LPG, an official statement said.

Losses on sale of subsidised fuel have risen by 35 percent to Rs 188 crore per day even though oil firms have been losing less per unit on LPG and kerosene because of fall in international oil rates.

State-owned fuel retailers are losing Rs 27.60 on sale of every litre of kerosene through the Public Distribution system (PDS) and Rs 393.50 per 14.2-kg domestic cooking gas LPG, an official statement said.

These are lower than Rs 31.22 a litre loss oil firms were incurring on sale through PDS in second half of last month, and Rs 404.64 per LPG cylinder.

Despite the losses being lower, the statement said, the per day under-recovery has risen to Rs 188 crore from Rs 139 crore.

"Oil Marketing Companies (OMCs), effective November 1, 2014, are now incurring combined daily under-recovery of about Rs 188 crore on the sale of PDS kerosene and domestic LPG.

This is higher than Rs 139 crore daily under-recoveries during previous fortnight," it said.

The statement did not explain as to how the daily under-recoveries have increased even through loss on both kerosene and LPG have declined.

After diesel price was deregulated last month, only two products remain subsidised.

The statement said the under-recovery or the revenue loss incurred on selling fuel below cost, in the first half of current fiscal was Rs 51,110 crore. "The figure was Rs 139,869
crore for full year in the 2013-14."

While the government had freed pricing of petrol from its control in June 2010, diesel was deregulated on October 18. Since then, diesel rates have cut twice - first by Rs 3.37 a
litre on October 19 and then by Rs 2.25 per litre from November 1.

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Watch: Mint Annual Energy Conclave 2014

Watch experts debating the issue of energy security at Mint Special Annual Energy Conclave 2014.

Watch experts debating the issue of energy security at Mint Special Annual Energy Conclave 2014.

Watch videos for full discussion.

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Tata Steel proposes to revise package for Gopalpur project

"We have submitted a fresh compensation package to Odisha government. The package will be announced after the government gives its go-ahead," Vice-president of the project Arun Mishra said yesterday.

Tata Steel  has proposed to revise the compensation package for families displaced by its Gopalpur project in Ganjam district.

"We have submitted a fresh compensation package to Odisha government. The package will be announced after the government gives its go-ahead," Vice-president of the project Arun Mishra said yesterday.

In 1996, people of Sindhigaon, Badapaur, Patrapur, Kalipalli and Paikapada villages near Gopalpur were displaced when the company acquired 2,970 acres for the then proposed shore-based mega steel plant. People of eight other villages were affected by the project, officials said.

Tatas later shelved the project and decided to set up an industrial park and multi-product special economic zone (SEZ). Chief Minister Naveen Patnaik laid the stone of the proposed park in August 2010.

The delay in execution of the project has led to the discontent among the displaced. Besides a special package in tune with the Resettlement and Rehabilitation (R&R) Policy, they are demanding permanent job to one member of every affected family.

Tata Rehabilitation Village Development Committee had submitted a memorandum to Tata Group's chairman Cyrus P Mistry during his visit to the area on September 2. It had demanded Rs 15 lakh compensation each to the affected families and fresh enumeration of those displaced by the project.

"The company will formulate a recruitment policy and submit it to the district administration. A skill development centre will be set up in the district to train local youths," Misra said.

He said the Gopalpur project was a priority for the company. "We'll be setting up a ferro chrome plan of 55,000 tonne per annum capacity, as an anchor project in the proposed park at a cost of Rs 400 crore. The plant is likely to start operation by March 2015," said Misra.

Around 350 people would get direct and indirect employment opportunities from the plant, he said.

"Another ferro chorme plant of 2.4 lakh ton per annum capacity will be set up at same place for which environment clearance has been sought," he said.

Tata Steel stock price

On November 03, 2014, at 14:13 hrs Tata Steel was quoting at Rs 490.55, up Rs 1.20, or 0.25 percent. The 52-week high of the share was Rs 578.60 and the 52-week low was Rs 324.25.

The company's trailing 12-month (TTM) EPS was at Rs 75.41 per share as per the quarter ended June 2014. The stock's price-to-earnings (P/E) ratio was 6.51. The latest book value of the company is Rs 629.60 per share. At current value, the price-to-book value of the company is 0.78.

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Doing well to be among 3 global IT service cos: TCS

TCS today ranks amongst one of the best companies with the way we partner with clients, said N Chandrasekharan.

If you really look at the growth rate as well as the absolute revenue that we add, we rank number one.

N Chandrasekaran

CEO & MD

TCS

On the sidelines of the  Tata Consultancy Services (TCS) New York Marathon, which saw a participation of around 50,000 runners, CEO and MD, N Chandrasekharan of the company spoke to CNBC-TV18's Menaka Doshi on the way forward.

It is the company's aim to be strategic partner to their customers. "TCS today ranks amongst one of the best companies with the way we partner with clients, he added.

Below is the trasnscript of that interview

Chandrasekharan: First of all what is more important is to continue to gain mindshare with our customers to be their strategic partners. I think we are doing very well. If you really look at the growth rate as well as the absolute revenue that we add, we rank number one. This is our incremental revenues every year so we seem to be doing things right now; we just have to keep on the momentum.

Q: But I am sure it is part of your ambition to be amongst the top three global IT service players in the world, how long will it take you to get there?

Chandrasekharan:  It is very difficult to predict a timeline but we are doing very well.

Q: Before your third term as CEO?

Chandrasekharan:  Let us see.

Q: The thing about size is it comes with its incumbent issues for instance you may rank sixth or seventh in terms of revenue but when it comes to people you rank number two at around 318,000, and IBM is the only one with a larger manpower than you are. Even Accenture whose revenues are much ahead of yours is far lower in terms of head counts. What is the main in terms of the quality of your growth, the quality of your revenue because you are sixth or seventh in revenue with the second largest workforce, is that efficient?

Chandrasekharan:  I would like to give you two perspectives. The first perspective is that the size of the workforce you have pretty much depends on the geography footprint from where you deliver the services. If your cost base of those locations is lower, that will also reflect in the overall revenue you see, so that has to be taken into account.

But specifically on the quality of revenues, I would say that TCS today ranks amongst one of the best companies with the way we partner with clients. We see the traction with clients, the kind of work we do. If you see the thought leadership engagements that we do, I think we get fair share of revenue.

Q: So are you saying that revenue per employee where you don't rank amongst the top 10 or profitability per employee where even a player like HCL Tech is ahead of you - these are not matrix that you treat important, these are not matrix that we should measure TCS by because they don't tell a very flattering story.

A: All these matrixes are important but you just have to see them in the overall perspective and they are important to the extent that you drive your business and grow your business in a manageable fashion. But at the same time you got to see the revenue per employee in the context of the locations in which you serve and we work with global customers and we want to have a fantastic foot print to be able to serve them in every market in which we operate and they operate.

TCS stock price

On November 03, 2014, at 14:10 hrs Tata Consultancy Services was quoting at Rs 2590.00, down Rs 14.55, or 0.56 percent. The 52-week high of the share was Rs 2834.00 and the 52-week low was Rs 1960.00.

The company's trailing 12-month (TTM) EPS was at Rs 99.52 per share as per the quarter ended September 2014. The stock's price-to-earnings (P/E) ratio was 26.02. The latest book value of the company is Rs 224.90 per share. At current value, the price-to-book value of the company is 11.52.

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Hopeful of further ATF cut; see improved revenues: SpiceJet

Sanjiv Kapoor, COO,  SpiceJet is hopeful of further price cuts in the aviation turbine fuel (ATF) being passed through going forward. However, he says any price cut has been a welcome one and eases the costs pressures. The company sees an impact of Rs 320 crore from this cut.

According to him the ATF prices in India are still significantly high, 40-60 percent higher than rest of the world. Globally the prices have dropped 17 percent from June, whereas in India only 10 percent has been passed through so far.

The price of aviation turbine fuel (ATF), or jet fuel, at Delhi was cut by Rs 4,987.7 per kilolitre, or 7.3 percent, to Rs 62,537.93 per kl, oil companies announced today.

The slew of festive season discounts offered by the airlines has led to improved revenues, and the load factor too improved to 86% in September, said Kapoor.

Below is the transcript of Sanjiv Kapoor's interview to CNBC-TV18's Latha Venkatesh and Sonia Shenoy

Latha: Is it good news at least of ATF price cut or will you have to pass it on?

A: It is good news certainly for the airlines, aviation fuel prices in India have been above 40-60 percent higher than rest of the world, combination of both the base price and taxes. So certainly a 7 percent plus 3 percent reduction that was done earlier, total 10 percent reduction is fantastic for our cost situation which will give us relief.

However, if people are expecting that to be passed on to customers then we already have the lowest fares on average in the world and this is just relief for the airlines on the cost side which was much welcome and much needed.

Sonia: So when you say that there is relief can you quantify that for us, is there any margin positive impact that you would see at all?

A: What I can just state is based on our financials which are public for fiscal 2014, fuel bills for the year was Rs 3260 crore, if you take out 10 percent it is Rs 326 crore, so significant impact but not enough on its own to turn the airline industry around.  However, it would certainly help us substantially on the cost side.

Latha: You are factoring in a 10 percent fall?

A: 3 percent happened earlier in October and 7 percent now.

Sonia: So how much more of a cut would you want to see in order for you to see a greater impact on your margins?

A: Like I said fuel prices in India are 40 to 60 percent higher than rest of the world. Now fuel prices have fallen 17 percent globally since June, and our reduction has been 10 percent. So while that is welcome the gap actually relative to global aviation fuel prices the cut passed on to us is smaller than what global reduction has been.

So in an ideal world we would hope that all of it is passed on to us and another 7 percent could be cut but we are happy with at least what has happened, we are hopeful that more will come in the future.

Latha: You would expect that at least in Q3 you will be able to get into the black at a net level?

A: I cannot comment on that but certainly any cost reduction is welcome.

Sonia: You have announced a slew of low fare offers in the last many weeks and months. Can you tell us what the impact of all this has been in terms of passenger growth and load factor?

A: The low fare offers that we have been offering are essentially to get rid of excess inventory, excess seats. The worst thing an airline can do is to hold on to seats and at the last minute discount it, because last minute passengers tend to be the least price sensitive. So if you have excess seats you want to get rid of them early. So our discounting has been designed by and large to give the deals to passengers willing to plan and book early, around 30-60 days early.

The impact has been very positive on load. In September, normally airlines fly with one third of the seats empty, with 65 percent occupancy or load factor. We ended September with 86 percent load factor.

However, loads alone are of course not the answer because you can easily fill your planes by giving tickets away for free. What you need to look at is has your unit revenue improved. I am happy to say that over the months where we have had the sale, the pricing philosophy that we have been following, our unit revenue measures have improved significantly so that is proof that the efforts to get rid of excess inventory early are positive for us and I believe for the whole industry.

Latha: Capital is also getting cheaper globally as well as you are saying fuel prices and may be an expected turnaround in the economy should all work to your advantage. Will you be looking for capital, strategic partnership? Anything at all that we should hear now that the circumstances are propitious?

A: I cannot comment specifically but of course we do need to recapitalise and efforts are ongoing on that front that is all I can say. You are right that macro indicators are positive and that is certainly good news.

Sonia: For the next quarter what kind of passenger growth will the industry see as a whole and what will SpiceJet do? In a sense what kind of market share are you looking at right now?

A: Well market share is just incidental. Our goal is to return to the black so we will do whatever is necessary whether it is rationalising capacity further etc to get to the black.

I don't want to set any market share goals and in terms of market growth I just want to emphasise that India is probably one of the most price sensitive markets in the world. We have seen that when you drop prices your loads go up sharply, demand just spikes but the opposite is also true.

So unfortunately it is not a cost pass industry, we cannot say look our cost is this therefore let us price above that. If it was that easy then every airline in the world would be making profits. So we need to just somehow maximise the revenues that we can get and then try to minimise the cost and hopefully the equation works in our favour eventually.

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Oct sales good; mkt share may rise to 23% by April: Bajaj

Despite the overall or general weak auto sales data, Rajiv Bajaj, managing director of  Bajaj Auto is pleased that his company's motorcycle market share in the country rose to 20 percent. He expects the market share to rise to 23 percent by April.

He says festive season sales have been good, but not extraordinary. Total sales for October stood at 3.86 lakh units versus 3.99 lakh units month-on-month (m-o-m), with Discover 150cc sales at around 28,000 for the month. The company, however, saw a modest 33,000 motorcycles retailed on Dhanteras day, says Bajaj. Bajaj Auto's three-wheeler sales rose 33 percent at 49,094 units (y-o-y).

The company's exports rose 15 percent at 1.58 lakh units y-o-y. Bajaj Auto is looking at new launches in Platina and Pulsar.

Below is the verbatim transcript of Rajiv Bajaj's interview with Sonia Shenoy and Latha Venkatesh on CNBC-TV18.

Sonia: Could you just take us through what the sales numbers have been this month?

A: It has been a good month. Year-on-year (YoY) it has been a flat month; about 3,86,000 motorcycles and three wheelers. I think for us the highlight of this month is that domestic motorcycle market share has come back now into 20 percent. You would remember that it was typically at 18 percent and in July and August it had slipped further to 15 percent but that was more to do with our internal stock alignment. By September it was up to 17 percent and in October it is little over 20 percent, thanks I would say primarily to new Discover. So, from this point of view particularly it was a very good month for us.

Sonia: What were the exact Discover 150cc sales this month?

A: I would guess about 28,000.

Latha: What is the dealer inventory position at the moment?

A: The dealer inventory position is very comfortable because in September we started by carrying normal stocks which is four to five weeks. At the end of September, in anticipation of the season we had added about 40,000 numbers to that. In October we reduced that by 15,000 numbers. So, we are 10,000 lower than we were on September 1.

Latha: On Dhanteras day or at least couple of days after Dhanteras we had both the HMSI management and Sunil Munjal from Hero telling us that they did some dramatic 1.65 lakh in one case and 1.67 lakh sales in a single day. What has the tally been at your end and has the Diwali month resulted in some market share trimming?

A: In October, as I said, in domestic motorcycles we have come back to about 20.5 percent. So, in that sense there has been a nice turnaround in market share ever since the Discover was launched.

I have to report for Dhanteras day a very modest 33,000 motorcycles retailed and let me comment on that. I think we maybe confusing between two numbers. One is what is actually retailed on that day and second is what is delivered by dealers on that day. A lot of people who want a product whether a bike or something else to be given to them on the auspicious day of Dhanteras do not go and buy it on that day because they are afraid there won't be any product for them to buy. So, most often it is booked for as much as two weeks in advance and the dealers go out and then deliver that.

So, I suspect that Hero and HMSI, when they quote 1,50,000 or whatever and one fellow said 1.50 lakh the other said 1.65 lakh and the first one raised it 200,000 so I don't know what these numbers mean and where are they coming from.

Latha: On Dhanteras day or at least couple of days after Dhanteras we had both the HMSI management and Sunil Munjal from Hero telling us that they did some dramatic 1.65 lakh in one case and 1.67 lakh sales in a single day. What has the tally been at your end and has the Diwali month resulted in some market share trimming?

A: In October, as I said, in domestic motorcycles we have come back to about 20.5 percent. So, in that sense there has been a nice turnaround in market share ever since the Discover was launched.

I have to report for Dhanteras day a very modest 33,000 motorcycles retailed and let me comment on that. I think we maybe confusing between two numbers. One is what is actually retailed on that day and second is what is delivered by dealers on that day. A lot of people who want a product whether a bike or something else to be given to them on the auspicious day of Dhanteras do not go and buy it on that day because they are afraid there won't be any product for them to buy. So, most often it is booked for as much as two weeks in advance and the dealers go out and then deliver that.

So, I suspect that  Hero and HMSI, when they quote 1,50,000 or whatever and one fellow said 1.50 lakh the other said 1.65 lakh and the first one raised it 200,000 so I don't know what these numbers mean and where are they coming from.

Sonia: You said 386,000 this month; that is lower than your own guidance of 400,000 that you had laid out last month. So, is it that the festive season built up has not been as strong as expected? What is the mood like on the ground?

A: I think the festive season has been as expected; it is no secret that it has not been extraordinary but it has gone up as expected. We expected to do about 200,000 motorcycles each in September and October and we have done that both in dealing and retail term. Total motorcycles have been about 145,000 of the Platina platform, about 90,000 of the Discover platform and about a 100,000 from the Pulsar platform. So, those are very good numbers. You are quite right that mathematically we are 14,000 short of 400,000 but I would say that within the range.

Latha: What about exports; that has been your strong point for the past several months. How much did you do in October itself?

A: We did close to 160,000 vehicles in export; again the highest exports for any October if I remember right. A shade lower than the 180,000 we had seen average in the last two months but I did say then that we had a special bonus in terms of a order for 20,000 Discover 125 for Sri Lanka each month for those two months. So, that apart we are maintaining the run rate as of now on export.

Sonia: Are you facing any kind of capacity constraints? We had lower number of working days so were there any capacity constraints on models like the Pulsar, etc?

A: The only capacity constraint that we have is in terms of ideas. We can produce whatever we want to produce.

Latha: Why are you scurrying for ideas at all? Are we going to expect a new launch, a new category launch?

A: The second half of this year we see two launches in two different tracks. One is in Platina and one is the Pulsar all new motorcycle. My own anticipation, I will stick my neck out and say that if you are talking in April we should be up to a good 23 percent or so in terms of domestic market share.

For the next year we have everything nice, very different, very big idea. Essentially it is the marketing idea. We think there is a segment out there for a couple of million motorcycles that doesn't have a product in the market today that is purpose made for it. So, that is what we are going to do, that is what we are going to launch next year and I am very excited that it is going to lead from domestic volumes in market.

Latha: Somewhere near Siddhartha Lal's category?

A: I won't do that to him. Let us not spoil their party.

Sonia: You are a flood of ideas, you just told us you have a dearth of it; this looks like a huge pipeline that you have lined up?

A: We have several launches and I must say that we have some interesting action to take place even under the KTM motorcycles. We are looking forward in January to the launch of quadricycle as well; that will be a new brand as well. So, there are a few things out there.

Sonia: Will it be refreshes, variants in Platina and Pulsar or are you looking at all together new launches?

A: These will be all together new launches, completely new motorcycles, new engine, new frames, new styling. When I said we can take 20 percent market share up to 23 percent, two percent market share in a market that is almost 1 million motorcycles a month is 30,000 bikes, I don't think refreshes will get you there.

Sonia: What would the total volumes be like by the end of the fiscal, what kind of a trajectory would you see?

A: I would like to believe that we can get to about 220,000-225,000 motorcycles domestically which is what would get us to 23 percent market share. Motorcycles are typically going at 130,000 motorcycles so total motorcycles would be about 350,000.

Latha: You didn't give us your three wheeler number?

A: Total three wheelers growth to 50,000. It is a very nice number; in domestic particularly a growth of 30 percent year-on-year (YoY).

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VE Commercial Vehicles sales up marginally in October

The company, which is a 50:50 joint venture between Volvo Group and Eicher Motors, had sold 3,001 units in the same month last year.

Auto maker VE Commercial Vehicles today reported a marginal increase in total sales of its Eicher branded products at 3,052 units in October.

The company, which is a 50:50 joint venture between Volvo Group and Eicher Motors , had sold 3,001 units in the same month last year.

Domestic sales registered a decline of 5.42 per cent to 2,494 units in October this year as against 2,637 units in the same month year ago, VE Commercial Vehicles (VECV) said in a statement.

However, exports of Eicher trucks and buses grew by 53.29 per cent to 558 units last month as against 364 units in October 2013, it added.

Eicher Motors stock price

On October 31, 2014, Eicher Motors closed at Rs 12769.50, up Rs 222.05, or 1.77 percent. The 52-week high of the share was Rs 12837.60 and the 52-week low was Rs 3855.00.

The company's trailing 12-month (TTM) EPS was at Rs 158.68 per share as per the quarter ended June 2014. The stock's price-to-earnings (P/E) ratio was 80.47. The latest book value of the company is Rs 303.07 per share. At current value, the price-to-book value of the company is 42.13.

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Toyota Kirloskar sales down 12% in October

The company had sold 15,576 units in the corresponding month of previous year, Toyota Kirloskar Motor (TKM) said in a statement.

Toyota Kirloskar Motor today reported 11.94 percent decline in total sales at 13,716 units in October 2014.

The company had sold 15,576 units in the corresponding month of previous year, Toyota Kirloskar Motor (TKM) said in a statement.

In the domestic market, TKM sold 12,556 units in October 2014, down 4.6 per cent as compared to 13,162 units in October 2013. During the month, the company exported 1,160 units of Etios.

Commenting on the sales performance, TKM Senior Vice President (Sales and Marketing) N Raja said: "We have maintained the sales volumes as September, in the domestic market and hope to see growth in the next two months".

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TiE The Knot: A platform for early stage entrepreneurs

Catch the second edition of TiE The Knot in partnership with TiE Delhi-NCR. TiE The Knot is a platform where early stage entrepreneurs are battling it out to raise funds from some of India's top venture capitals and angels. Watch how four start-ups strike a deal and will walk away with over Rs 6.5 crore in funding.

Catch the second edition of TiE The Knot in partnership with TiE Delhi-NCR. TiE The Knot is a platform where early stage entrepreneurs are battling it out to raise funds from some of India's top venture capitals and angels. Watch how four start-ups strike a deal and will walk away with over Rs 6.5 crore in funding.

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Hyundai sales up 11.54% in October at 56,010 units

Commenting on the sales performance, HMIL Senior Vice President (Sales and Marketing) Rakesh Srivastava said there was increase in sales in additional and replacement buyers segment with demand led by new models like Elite i20, Xcent, coupled with festival buying.

Hyundai Motor India Ltd (HMIL) today reported 11.54 percent increase in total sales at 56,010 units in October 2014. The company had sold 50,212 units in the same month last year, it said in a statement. In the domestic market, Hyundai sold 38,010 units last month as compared to 36,002 units in October 2013, up 5.57 percent.

During the month, Hyundai's exports grew by 26.67 percent to 18,000 units as against 14,210 units in the same period last year. Commenting on the sales performance, HMIL Senior Vice President (Sales and Marketing) Rakesh Srivastava said there was increase in sales in additional and replacement buyers segment with demand led by new models like Elite i20, Xcent, coupled with festival buying.

"We anticipate that this positive momentum would build up further with increase in sales of entry buyers if there is strong promise of improvement in economic and macro factors in rural and urban markets," he added.
 

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LSE to delist Ranbaxy GDR programme with effect from Dec 15

Drug firm Ranbaxy Laboratories on Friday said Luxembourg Stock Exchange (LSE) will delist the company's Global Depository Receipts programme with effect from December 15.

Drug firm Ranbaxy Laboratories  on Friday said Luxembourg Stock Exchange (LSE) will delist the company's Global Depository Receipts programme with effect from December 15.

In view of the proposed termination of the deposit agreement on December 15, 2014, the LSE will de-list the GDS from the official list and withdraw the trading of GDS on the Euro MTF Market of the LSE with effect from December 15, 2014, Ranbaxy Laboratories said in a filing to the BSE.

The company said it has received a letter from LSE in this regard.

Earlier this month, the company had said that it has notified the Bank of New York Mellon to terminate the Deposit Agreements dated July 7, 1994 and underlying Global Depository
Receipts (GDR) programme.

Ranbaxy shares on Friday closed at Rs 632.10 apiece on the BSE, up 1.34 percent from their previous close.

Ranbaxy Labs stock price

On October 31, 2014, Ranbaxy Laboratories closed at Rs 632.10, up Rs 8.35, or 1.34 percent. The 52-week high of the share was Rs 667.30 and the 52-week low was Rs 306.05.

The company's trailing 12-month (TTM) EPS was at Rs 20.93 per share as per the quarter ended September 2014. The stock's price-to-earnings (P/E) ratio was 30.2. The latest book value of the company is Rs 25.84 per share. At current value, the price-to-book value of the company is 24.46.

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JSW plans to raise USD 500 mn to part-refinance rupee debt

With the aim to refinance a part of its rupee debt, JSW Steel is planning to raise USD 500 million through a bond sale to investors in Asia and Europe, investment banking sources said.

With the aim to refinance a part of its rupee debt,  JSW Steel is planning to raise USD 500 million through a bond sale to investors in Asia and Europe, investment banking sources said.

The roadshows for the bond sale would start next week and the company representatives would visit Singapore, Hong Kong and London to woo investors, they added.

Confirming the schedule of the roadshows, JSW Steel's Joint Managing Director and Group CFO M V S Seshagiri Rao told PTI that the proposed bond sale was aimed at refinancing part of the rupee debt and aimed at reducing the interest outgo.

He, however, did not confirm the amount, tenor and timing of the bond, saying the call would be taken on the movement of the market which is "a little stable" now.

JSW Steel has Rs 35,750 crore net debt out of which 35 percent is in foreign currency.

In a statement to the stock exchanges, JSW Steel said it "is contemplating issuing of debt instruments in the form of US Dollar denominated senior notes. The notes, if issued, will be listed on the Singapore Stock Exchange."

"A preliminary offering circular has been prepared and shall be made available to prospective investors in relation to the contemplated issue of notes. The notes will not be
offered or sold in India or in the US," JSW Steel added.

Meanwhile, the company has been assigned Ba 1 rating with stable outlook by Moody's and BB+ rating with stable outlook by Fitch.

Moody's said JSW Steel's Ba1 rating reflects its large scale and competitive conversion costs and its track record of managing growth, both organic and by acquisition, while at the same time controlling consolidated leverage to moderate levels relative to its steel industry peers.

Fitch assigned JSW Steel a senior unsecured rating of 'BB+' and the company's proposed US dollar denominated notes an expected rating of 'BB+'.

Fitch said JSW Steel benefits from its low cost base due to its low conversion costs. It's efficient operations were reflected in its strong profitability, with EBITDA margin of 17.9 percent in FY'14.

The rating agency expects JSW Steel's profitability to remain strong over the medium term because it would continue initiatives to reduce costs.

JSW Steel stock price

On October 31, 2014, JSW Steel closed at Rs 1261.60, up Rs 13.90, or 1.11 percent. The 52-week high of the share was Rs 1365.35 and the 52-week low was Rs 805.00.

The company's trailing 12-month (TTM) EPS was at Rs 124.82 per share as per the quarter ended September 2014. The stock's price-to-earnings (P/E) ratio was 10.11. The latest book value of the company is Rs 970.48 per share. At current value, the price-to-book value of the company is 1.30.

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Welspun Enterprises completes sale of WMSL to JSW Steel

WMSL's long term loan liability of about Rs 1,095 crore stands fully repaid.

Welspun Enterprises  (WEPL), part of the USD 3 billion Welspun Group, said here today that it has completed the sale of Welspun Maxsteel (WMSL) to  JSW Steel (JSW) in follow up to the definitive agreement between the two companies on August 18.

The deal, which included the sale of the entire shareholding of WMSL held by WEPL to JSW Steel, was cleared by 'the Competition Commission of India' on September 23, the
company said in a release issued here.

The deal concluded with further infusion of about Rs 19.4 crore by WEPL after adjusting the value of net current assets receivable by it to fulfill the gap between the current
long term loan liabilities of WMSL and amount infused by JSW in WMSL.

As a result, WMSL's long term loan liability of about Rs 1,095 crore stands fully repaid.

Welspun Group had earlier identified Welspun Maxsteel, as its non-core business, hence has accordingly exited the same.

Welspun Ent stock price

On October 31, 2014, Welspun Enterprises closed at Rs 203.15, down Rs 5.5, or 2.64 percent. The 52-week high of the share was Rs 288.80 and the 52-week low was Rs 89.30.

The company's trailing 12-month (TTM) EPS was at Rs 0.00 per share as per the quarter ended November 2014. The stock's price-to-earnings (P/E) ratio was 0. The latest book value of the company is Rs 1228.84 per share. At current value, the price-to-book value of the company is 0.17.

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Tata International raises SGD150m in perpetual bond sale

This is the first-ever perpetual bond issuance in the Singapore debt market by a domestic company, as also the largest sole-advisor led transaction from country in recent years, according to the merchant banker HSBC.

The global trading arm of the over USD 103 billion Tata Group, Tata International, has raised 150 million Singapore dollars in an overseas bond sale, priced at 6.65 percent.

This is the first-ever perpetual bond issuance in the Singapore debt market by a domestic company, as also the largest sole-advisor led transaction from country in recent years, according to the merchant banker HSBC.

The issue got close to seven times over-subscription, enabling the company to tighten pricing to 6.65 percent, HSBC said.

The company could not be immediately contacted for a comment.

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