Mittal rings in structural rejig at Bharti

Bharti Enterprises on Friday announced a new apex-level organisational structure effective from April 1, 2007, under which it will only play a supervisory role and be the strategic architect of all businesses of the group.

“Bharti Enterprises will now be responsible for evaluating new business opportunities, mergers and acquisitions and strategic alliances for the group,” its chairman and CEO Sunil Mittal told ET.

The group, best known for its cellular services under the Airtel brand, also has interests in diversified business areas including retail, communication and media devices, insurance and financial services, agri, BPO and software.

Read more at The Economic Times

Mittal not doing an Arcelor at Posco

South Korean media reports about the world’s largest steel maker Arcelor Mittal eyeing a hostile takeover bid for Posco, the third largest steel company in the world, have been denied by both companies. A top Arcelor Mittal executive told ET that there was no truth in these reports.
Posco, too, has has denied a Korean newspaper report that a senior Arcelor Mittal executive expressed interest in Posco’s M&A strategy when he visited South Korea last month. “The Arcelor Mittal executive and Posco CEO talked about the consolidation in the global steel industry at that time but the executive did not mention Poscos’s M&A strategy,” a Posco official told news agencies.

The Korea Economic Daily on Friday reported that Arcelor Mittal could be interested in making a hostile takeover of South Korean steel maker. Citing an unnamed Posco executive, the local paper reported that Arcelor Mittal’s interest in the Korean major’s M&A strategy means the firm has put Posco on its M&A target list. Roland Junck, a member of Arcelor Mittal’s management board, had met Posco chief executive Lee Ku-taek last month.


Read more at The Economic Times

Rabobank bullish on Indian telecom

Top Dutch financial conglomerate, Rabobank International, is betting big on the Indian telecom and media segments which it says are on the threshold of an explosive growth over the next two-three year period.

"We are very bullish on Indian telecom," Rabobank International's Global Head for Telecom, Media and Internet Group, Ed Smith, told PTI here.

Given the kind of growth anticipated in telecom over the next few years, "we could be scaling up our exposure to the sector in the next three years. In fact, our exposure could more than double during this period," Smith said.

Read more at The Economic Times

Merrill Lynch to double pvt banking biz

Global financial services major Merrill Lynch is planning to double its private banking business in the country, with an aim to provide financial services for the growing wealthy population.

Merrill Lynch, which provides wealth management advisory service to High Networth Individuals (HNI), is aggressively building the private client business in India with an aim to double the number of its financial advisers this year and is also planning to expand into tier-II cities.

"Merrill Lynch is aggressively building the private client business in India and will invest in people, technology and infrastructure to support expansion plans. We plan to double the number of financial advisers this year, which already doubled from the year before," Merrill Lynch head of India Global Private Client Rahul Malhotra said.

Read more at The Economic Times

Interest rate war to push up cost of deposits for banks

Top bankers here have said the rate war among banks, that has pushed up interests on deposits to as much as 9 and 9.5 per cent, have increased the cost of deposits for lenders.

Anil Khandelwal, Chairman and Managing Director, Bank of Baroda, said higher rates could increase the cost of deposits for banks by 1 to 2 percentage points.

The cost of deposit for many banks worked out to about 4.5/5 per cent last year.

Read more at The Economic Times

Sun Pharma to invest $60-70 mn in research ops

Mumbai-based drug firm Sun Pharma is planning to hive-off its research operations into a separate entity with an overall investment of USD 60-70 million in the next three years.

The new research entity, Sun Pharma Advanced Research Company (SPARC), will invest USD 60-70 million to support research operations over the next three years, Sun Pharma Chairman and Managing Director Dilip Sanghvi said.

Sun Pharma would initially pump in USD 45 million in the new company while the remaining sum would be met through internal accruals of SPARC once it starts generating revenues, a company official said.

Read more at The Economic Times

Ambani Vs Ambani or Ambani & Ambani

It is fashionable for Indian media to describe any bickering in the Ambani household as Ambani vs Ambani. For a moment, spare a thought for Ambani & Ambani. If the net worth of the two Ambani brothers is combined, it will propel them to the fourth slot globally in the Forbes list of billionaires and to the No.1 position among Indian billionaires, even ahead of Lakshmi Niwas Mittal.

Think about it. Their combined wealth of $38.3 billion will make them the second-richest business family in the world, next only to the Waltons of Wal-Mart whose combined wealth tots up to a staggering $83 billion. As Mukesh Ambani gears up to meet the threat of Wal-Mart in India, he might appreciate the irony.

Leave aside the irony, it would have made the legendary Dhirubhai Ambani proud. Strategy gurus around the world may see this as a great opportunity for a Harvard or a Kellogg case study - call it 'Divide And Grow.' It is possible that the emergence of the Ambanis as one of the biggest business families in the world would not have taken place if the two brothers had not split.

Read more at The Economic Times

RIL signs $4.5 bn deal for gas fields

Reliance Industries Ltd has signed contracts worth $4.5 billion to develop its gas fields off India’s southeast coast. The spending will be part of $5.2 bn of investment the company plans for the area, RIL’s president for oil and gas PMS Prasad said here today. Gas production will start on schedule in 2008, he added. “Investment has already been committed to ensure that all suppliers meet their deadlines, which will enable us to start production,’’ Prasad said.

Commercially viable deposits in the fields may help Reliance meet India’s growing requirements for gas for power plants and fertiliser companies. India, Asia’s third-biggest oil market, is promoting exploration to reduce dependence on imports as prices rise to records and output declines from ageing fields. India’s current gas supplies of 85 million cubic meters a day, including imported liquefied natural gas, falls short of the potential demand of 170mn cubic meters, according to estimates by the Oil ministry. Gas consumption may rise to 400 million cubic meters a day by 2025 if the economy grows at the projected rate of 7-8 % a year.

Read more at Financial Express

Overseas bourses take cue from India markets

Often, in the absence of a visible domestic trigger, the behaviour of Indian stock markets is explained as a result of global developments, mainly the rise or fall of overseas markets. Curiously, it will not be far-fetched to state the contrary, that the global stock exchanges follow the Indian markets’ cue.

A study of the movements of world markets since May 2006 by Mumbai-based Man Financial shows that the S&P CNX Nifty recorded its high ahead of all major international indices. It recorded its intermediate top during February 6-12 this year and all-time intra-day high of 4,245.30 on February 8.

This was followed by all major international indices recording their respective highs. The only exception has been the Hang Seng index of Hong Kong, which recorded its high on January 24 this year.

Read more at Business Standard

Beauty mart

The company wants to tap the huge opportunity in the beauty and wellness retail space.

Look good and feel better. That’ll be easy to do once the Rs 2,000 crore Dabur India rolls out its 350 health and beauty stores. With a fairly large portfolio in the health and beauty segment and a wide range in the healthcare category, the FMCG major’s foray into the retail space was almost a given.

Says Sunil Duggal, CEO, “There’s a need for quality service and store environment in the health and beauty retail market in India today and no major player has entered this space so far. We’re looking to tap the growth prospects in both the retail market and the health and beauty segment.” Read more at Business Standard

RIL,OVL to bid jointly for oil blocks in Iraq

In a bid to leverage their oil exploration and production expertise, Reliance Industries (RIL) and ONGC Videsh (OVL), the overseas investment arm of Oil and Natural Gas Corporation (ONGC), are planning to jointly bid for oil and gas blocks in Iraq.

The two companies are already renegotiating for a stake in the Tuba field and the Block-8 in western Iraq.

OVL, Reliance and Algeria’s Sonatrach were in talks with the Saddam Hussein regime before the US took over Iraq in 2000. The UN sanctions that came in after 2000 prevented further talks from talking place.

“We are ready to partner OVL in overseas search for oil and gas exploration blocks. OVL is in the process of getting approval for a joint business with us,” a senior Reliance official said. OVL official declined to comment. Read more at Business Standard

Dow, Reliance JV this week

Dow Chemicals, the US-based petrochem giant, may announce its intent of floating a joint venture with Reliance Industries this week.

Sources close to the development said the foreign company would announce this week, if not Sunday, that it would spin off its underperforming commodity businesses into a separate entity in which Reliance would pick up a majority stake. However, the valuation of the joint venture might be not immediately announced, they said.

It means the announcement may not give a sense of Reliance’s investment for picking up a majority stake in the venture. Dow, perhaps, would announce the appointment of a valuer to ascertain the worth of the venture, they added.

Both the companies are keeping mum on the issue. A Reliance spokesperson declined to comment while an e-mail sent to Dow remained unanswered. Read more at Business Standard

FM confident about reigning in prices, inflation

Expressing confidence about checking soaring prices, Finance Minister P Chidambaram today said inflation would be controlled step by step following a series of measures announced by the Reserve Bank of India.

Admitting that inflation had not come down in the last six weeks, he said: "It is 6.1, 6.3..6.05..6.4 per cent etc... not a big rise in inflation nor a steep fall. It has remained above 6% on an average. I agree it is there."

Inflation surged to 6.46% during the week ended March 3 as against 6.10% in the preceding week.

Similar inflation rates were witnessed in 2000-01 continuously for 48 weeks, and for 22 weeks it even crossed 7%, Chidambaram told reporters at Sivaganga, about 60 km from here, after reviewing various on-going projects in the district.

Read more at Business Standard

China hikes rates to slow inflation, investment

China raised interest rates for the third time in 11 months to curb inflation and asset bubbles in the world's fastest-growing economy, according to a report on the website of Bloomberg.

The one-year benchmark lending rate will be raised to 6.39% from 6.12%, starting tomorrow, the Beijing-based People's Bank of China said today on its website. The one-year deposit rate will be increased to 2.79% from 2.52%. A central bank spokesman confirmed the increases, the report added.

Central bank Governor Zhou Xiaochuan is concerned that cash from a record trade surplus is stoking excess investment, raising the risk of accelerating inflation and boom-and-bust cycles in asset prices. Premier Wen Jiabao said yesterday the nation's economic expansion is unstable and environmentally unsustainable, the report said.

Mkt Outlook: Sentiment weak, but rally possible

The Sensex continued to drift lower for the fifth straight week, and, in the process, has shed 14.5% (2,109 points). The index had last posted weekly gains during the week ended February 9 when the Sensex hit its peak at 14,724 and ended at 14,539.

The Sensex started on a positive note for the week ended March 17, and went on to log gains on three of the five trading sessions but the upmove lacked conviction - the index could not hold gains and ended the week with a significant loss of 455 points at 12,430.

The Nifty rallied to a high of 3781 early in the week, and then dropped to a low of 3574 - down 208 points from the high. The index finally ended with a loss of 109 points at 3609.

Read more at Business Standard

BSNL to invest Rs 4,500 cr for convergent billing system

MUMBAI: Bharat Sanchar Nigam (BSNL) will invest over Rs 4,500 crore for introducing a convergent billing system across India. The PSU telco is close to finalising the winner for what will be one of the world's largest tenders for billing systems.

IT giants Wipro Infotech, HCL Technologies, TCS, Satyam Computers and Tech Mahindra have qualified technical evaluation and financial evaluation is underway. The contract will be split between two players and the winners are likely to be announced next month, sources told ET.

Read more at Economic Times

Outbound air fares to soar 10%

NEW DELHI: Your summer holidays just got costlier. Air travel to international destinations will cost more after March. While airfares dipped by around 10% last year in April, this year they will increase by 10%. Sample this: Jet Airways’ return fare (excluding taxes) to London will go up from Rs 24,000 to Rs 26,800. Air India’s fare to New York will increase from Rs 35,000 at present to Rs 45,000, while a flight to Mauritius will go up from Rs 19,700 to Rs 21,700.

Read more at Economic Times