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Re fall due to global risk aversion to EMs, no aid from RBIThe rupee has been falling much before the trade data began to show weakness last week. A lot of currencies across the Asian continent fell. This fall in Asian currencies is due to a global risk aversion, with people just moving away from emerging markets and equities in general.Source: Moneycontrol Top Headlines | 2 Mar 2009 | 5:30 pm Experts deconstruct the RILRPL mergerThe timing of this merger has been very appropriate. RIL is a diversified company, and post this merger, it will be among the top10 refiners in the world, Uday Kotak of Kotak Mahindra Bank, said, reacting to the RILRPL mergerSource: Moneycontrol Top Headlines | 2 Mar 2009 | 4:13 pm Orissa Sponge can grow into 4m tn steel plant: Monnet IspatSandeep Jajodia, Executive ViceChairman and Managing Director, Monnet Ispat Energy, said there is a lot of potential to grow Orissa Sponge in the business itself because of the captive raw material. \"We would like to buy more because the potential there is to grow the company into almost a 34 million tonne steel plant.\"Source: Moneycontrol Top Headlines | 2 Mar 2009 | 3:59 pm Merger proposal with RPL has no rating impact on RIL: SPStandard Poor\'s Ratings Services said today that there is no immediate impact on its corporate credit ratings on Reliance Industries Ltd. (RIL, BBB/Negative/) following the merger proposal announced with its 70.38%owned subsidiary Reliance Petroleum Ltd. (RPL, unrated).Source: Moneycontrol Top Headlines | 2 Mar 2009 | 3:58 pm See no order growth next quarter: Gokaldas ExportsRajendra Hinduja, Executive Director, Gokaldas Exports, said there will be no growth in terms of orders next quarter. However, he was quick to add that the company will maintain last years figures.Source: Moneycontrol Top Headlines | 2 Mar 2009 | 3:32 pm India sets dates for April-May general electionNEW DELHI (Reuters) - India will hold a general election between April 16 and May 13, election officials said on Monday, kicking off a mammoth process in which 714 million people will be able to cast their votes.Source: Reuters: Money News | 2 Mar 2009 | 2:07 pm Jain Irrigation plans to raise $45m from IFCJain Irrigation Board today approved allotment of upto 2mn Equity Shares of Rs 10 each to International Finance Corporation, Washington on a preferential allotment basis at a price to be arrived at on the basis of SEBI (DIP) Guidelines, 2000. Investment is subject to necessary approvalsSource: Moneycontrol Top Headlines | 2 Mar 2009 | 2:01 pm RIL, RPL merger: A comprehensive CNBC-TV18 analysis - Moneycontrol.com
Source: Google News India - Business | 2 Mar 2009 | 1:52 pm RIL-RPL merger India's 10th largest M&A deal ever; top in '09The new RIL shares to be issued as part of the merger would be worth Rs 8,478 crore (about 1.69 billion dollar) at the current market price.Source: Daily News & Analysis: Money News | 2 Mar 2009 | 1:49 pm AIG gets new aid after record $61.7 bln lossNEW YORK (Reuters) - American International Group Inc posted a $61.7 billion quarterly loss, the biggest in corporate history, and reached a new government bailout deal after officials concluded the insurer was too big to be allowed to fail.Source: Reuters: Money News | 2 Mar 2009 | 1:42 pm RPL shareholders to gain from diversification: Uday KotakSharing his views on the biggest news of the daythe RILRPL merger, Uday Kotak, VC and MD of Kotak Mahindra Bank, said the timing of merger is appropriate. He pointed that post the merger the company will be among the top10 refiners in the world. RPL shareholders, he said, will benefit from diversification with RIL.Source: Moneycontrol Top Headlines | 2 Mar 2009 | 1:39 pm Tata, Etisalat to launch enterprise network service - Hindu
Source: Google News India - Business | 2 Mar 2009 | 1:38 pm Gold spurts by Rs275 per ten grams on global worriesMumbai: Deepening fears of global recession and weak equity markets, lifted the gold prices by Rs275 per ten grams to Rs15,665 on the bullion market on Monday as safe-haven buying. Silver also firmed up further in line with gold prices. Good demand from local parties in view of marriage session also boosted the the prices of precious metals, a dealer said. Gold prices climbed for the first time in six sessions in London as stock markets tumbled on speculation that economies are worsening, adding the metal’s appeal as a store of value. Gold for immediately delivery rose as much as $16.16 an ounce to $958.51 and was traded at $950.43 an ounce. April futures gained by $9.50 to $952.00 an ounce in electronic trading on the New York Mercantile Exchange’s comex division. The BSE benchmark index ended lower by 285 points or 3.20%. In the local market, standard gold (99.5 purity) rose by Rs275 per ten grams to close at Rs15,665 from the last weekend’s level of Rs15,390. Pure gold (99.9 purity) also strengthened to Rs15,725 from Rs15,460 previously. Silver ready (.999 fineness) shot up by Rs395 per kilo to Rs22,330 from Rs21,935. Source: Home - Livemint.com | 2 Mar 2009 | 1:33 pm Jharkhand sanctions Rs.1.15 bn for airport expansionJharkhand Monday sanctioned a Rs.1.15-billion (Rs.115 crore) investment for expansion of the Birsa Munda airport here, said an official.Source: IndiaeNews.com: Business News | 2 Mar 2009 | 1:31 pm ANALYSIS - Auto woes no death knell for Swedish industrySTOCKHOLM (Reuters) - Sweden's car makers Saab Automobile and Volvo Cars face a grim struggle to survive but manufacturing industry as a whole in the Nordic country remains competitive.Source: Reuters: Money News | 2 Mar 2009 | 1:29 pm Reduce Tata Steel, target of Rs 146: Angel Broking - Moneycontrol.com
Source: Google News India - Business | 2 Mar 2009 | 1:29 pm Rupee to drop to 56/dlr in 3 months - Barclays - Reuters India
Source: Google News India - Business | 2 Mar 2009 | 1:25 pm Rupee hits record low on bearish marketsMumbai: The rupee slipped to a record low on Monday as falling stocks, weak export data, bearish global markets and an arbitrage play with offshore derivatives drained demand despite suspected Reserve Bank of India, or (RBI), intervention. The partially convertible rupee closed at Rs51.90/92 per dollar, sharply down from Rs51.10/12 on Friday. The rupee fell 1.5% on the day, taking its losses to 6.2% in 2009. “It was an out-and-out non-deliverable forwards-related demand. Those with dollar loans, external commercial borrowings, etc. and who are unhedged are scrambling to cover after Rs50.65 broke,” a senior dealer with a private bank said. “At the same time, exporters have gone to sidelines and will hold out unless they get a sense of dollar’s top in place. So the demand-supply has gone totally skewed, with supply only coming from the central bank (RBI),” he added. Dealers said state-run banks likely sold between $500 to $800 million to stem the rupee’s fall. One-month offshore non-deliverable forward contracts were at Rs52.28/38, weaker than the spot rate. That creates an arbitrage opportunity where dollars are bought locally and sold offshore to profit from the price differential. Losses in shares also weighed. Indian stocks fell 3.2% to their lowest close in more than three months, raising concerns of more foreign outflows. The rupee could drop to Rs56 per dollar in the next three months, weighed by an economic slowdown and a balance of payments deficit, Barclays Capital said on Monday. The rupee was not alone in its woes, with the South Korean won falling to an 11-year low as investors shifted away from riskier emerging market assets. Foreign investors sold $1.7 billion of local shares in the first two months of the year, after selling more than $13 billion last year when the rupee fell more than 19%. “The US data on Friday reminded everybody about the extent of the global economic situation and that has triggered a sell-off in markets. And even though India may not have much exposure to the world, it is not an island,” said Nizam Idris, currency strategist with UBS in Singapore. “Forex, whether it is in Asia or elsewhere, is being dictated by the global risk position and right now the outlook isn’t very bright and the rupee is just reflecting its regional peers.” Dealers said a drop in exports added to the poor sentiment. Exports fell 15.9% in January from year earlier, a fourth straight fall as the global downturn bites. Still, the trade deficit narrowed to $6.1 billion in January from $7.6 billion in December as import values dropped 18.2%, mainly due to the sharp fall in oil prices. Source: Home - Livemint.com | 2 Mar 2009 | 1:22 pm HSBC in $18 bln rights issue, slashes U.S. jobsLONDON (Reuters) - HSBC launched Britain's biggest rights issue on Monday, to raise 12.85 billion pounds ($18.3 billion) to help it overcome big losses in the United States and exploit the woes of weaker rivals.Source: Reuters: Money News | 2 Mar 2009 | 1:18 pm TEXT: Joint US Treasury, Fed statement on AIG - Reuters
Source: Google News India - Business | 2 Mar 2009 | 1:10 pm India eases ban on China toys, wants safety stamp - Reuters India
Source: Google News India - Business | 2 Mar 2009 | 1:09 pm India lifts Chinese toy ban, demands safety guaranteesNew Delhi: India’s government lifted a ban Monday on imports of Chinese toys that had stoked trade tensions between the world’s two biggest emerging economies. But it imposed strict demands for product safety guarantees. India announced the six-month ban in January, prompting Beijing to warn that “bilateral trade relations could be seriously impacted”. The Indian trade ministry, which had made the decision on the grounds of “public health and safety”, announced Chinese toys could be imported -- but needed to be certified as safe according to international standards. Chinese toy imports “shall be permitted” if accompanied by certificates showing they “conform to standards prescribed” by safety bodies such as the International Organisation for Standardization (ISO) or the American Society for Testing and Materials (ASTM), the trade ministry said in a statement. The imports will have to be accompanied by certificates from laboratories accredited to the International Laboratory Accreditation Cooperation, the ministry further stipulated. Chinese toys such as dolls, cars, trains and puzzles make up more than 60% of India’s $500 million toy market and the ban sent prices of toys soaring in local markets as imported supplies started running out. Some Indian analysts had seen the ban as a move to protect India’s struggling toy industry, which employs some two million workers, and the media had dubbed the row the “toy trade war”. The Indian toy sector said it had been pushing New Delhi for higher import tariffs on Chinese toys, which are cheaper than those made locally, but not a full-scale ban. China had warned India to take “cautious and prudent trade remedy measures” at a time when “the world economy faces grim challenges”. But India said the toy ban complied with World Trade Organisation rules and would not be lifted until the government was “satisfied” about the safety of the Chinese products. China’s toy industry has come under close scrutiny since millions of goods were recalled globally last year amid fears they were made with toxic lead paints or had design flaws. Thousands of Chinese toy factories have closed because of tighter safety restrictions and falling demand amid the widening global financial crisis. India’s toy ban came amid mounting trade frictions between the Asian neighbours. China is India’s largest trading partner while India is China’s 10th biggest trading partner. Aside from the toy ban, China’s commerce ministry has complained that India has launched 17 trade investigations since October into Chinese products, including 10 anti-dumping probes, and curbed imports of iron and steel, chemicals and textiles from China. Various countries have been moving to shield domestic industries against the worldwide slowdown but India’s commerce minister Kamal Nath has insisted New Delhi opposes any form of trade protectionism. Source: LatestNews-Home - Livemint.com | 2 Mar 2009 | 1:07 pm India lifts Chinese toy ban, demands safety guaranteesNew Delhi: India’s government lifted a ban Monday on imports of Chinese toys that had stoked trade tensions between the world’s two biggest emerging economies. But it imposed strict demands for product safety guarantees. India announced the six-month ban in January, prompting Beijing to warn that “bilateral trade relations could be seriously impacted”. The Indian trade ministry, which had made the decision on the grounds of “public health and safety”, announced Chinese toys could be imported -- but needed to be certified as safe according to international standards. Chinese toy imports “shall be permitted” if accompanied by certificates showing they “conform to standards prescribed” by safety bodies such as the International Organisation for Standardization (ISO) or the American Society for Testing and Materials (ASTM), the trade ministry said in a statement. The imports will have to be accompanied by certificates from laboratories accredited to the International Laboratory Accreditation Cooperation, the ministry further stipulated. Chinese toys such as dolls, cars, trains and puzzles make up more than 60% of India’s $500 million toy market and the ban sent prices of toys soaring in local markets as imported supplies started running out. Some Indian analysts had seen the ban as a move to protect India’s struggling toy industry, which employs some two million workers, and the media had dubbed the row the “toy trade war”. The Indian toy sector said it had been pushing New Delhi for higher import tariffs on Chinese toys, which are cheaper than those made locally, but not a full-scale ban. China had warned India to take “cautious and prudent trade remedy measures” at a time when “the world economy faces grim challenges”. But India said the toy ban complied with World Trade Organisation rules and would not be lifted until the government was “satisfied” about the safety of the Chinese products. China’s toy industry has come under close scrutiny since millions of goods were recalled globally last year amid fears they were made with toxic lead paints or had design flaws. Thousands of Chinese toy factories have closed because of tighter safety restrictions and falling demand amid the widening global financial crisis. India’s toy ban came amid mounting trade frictions between the Asian neighbours. China is India’s largest trading partner while India is China’s 10th biggest trading partner. Aside from the toy ban, China’s commerce ministry has complained that India has launched 17 trade investigations since October into Chinese products, including 10 anti-dumping probes, and curbed imports of iron and steel, chemicals and textiles from China. Various countries have been moving to shield domestic industries against the worldwide slowdown but India’s commerce minister Kamal Nath has insisted New Delhi opposes any form of trade protectionism. Source: World Business - Livemint.com | 2 Mar 2009 | 1:07 pm India may lose $13 bn due to delay in spectrum auction: AssochamIndia may lose up to $13 billion in revenues by 2012 if the third generation (3G) spectrum is not allocated soon to telecom operators, an industry lobby said Monday.Source: IndiaeNews.com: Business News | 2 Mar 2009 | 1:01 pm India relaxes ban on import of Chinese toysIndia Monday relaxed the general ban on the import of Chinese toys imposed over a month ago if such shipments come with certificates from independent agencies saying they meet the prescribed global health and quality standards.Source: IndiaeNews.com: Business News | 2 Mar 2009 | 1:01 pm India pepper futures end up on short-covering - Reuters India
Source: Google News India - Business | 2 Mar 2009 | 12:58 pm Rupee hits record low, more weakness seenMUMBAI (Reuters) - The rupee dropped to a record low on Monday as falling stocks, weak data, bearish global markets and an arbitrage play with offshore derivatives drained demand despite suspected central bank intervention.Source: Reuters: Money News | 2 Mar 2009 | 12:55 pm Blackwater founder steps down as CEOWashington: Blackwater founder Erik Prince is stepping down as the company’s chief executive officer. Prince said in a statement on Monday that he has appointed a new president and a new CEO and that the moves were part of the beleaguered company’s “continued reorganization and self-improvement”. Prince founded Blackwater in 1997 and in February this year the company changed its name to Xe. The company has had a contract to protect US diplomats in Iraq, but last month the State Department said it would not rehire Blackwater after its contract expires in May. The company has one other major security contract, details of which are classified. A report by a House committee in October 2007 called Blackwater an out-of-control outfit indifferent to Iraqi civilian casualties involved in nearly 200 shooting incidents since 2005. Source: LatestNews-Home - Livemint.com | 2 Mar 2009 | 12:47 pm Global cues pull Nifty below 2700 - Economic Times
Source: Google News India - Business | 2 Mar 2009 | 12:40 pm Sensex tanks 247 pts in early trade!BSE benchmark Sensex fell by over 247 points in the opening trade.Source: Zee News : Business | 2 Mar 2009 | 12:40 pm RIL-RPL merger approved; RIL opens down, RPL surges on BSE!Shares of the country`s largest private sector firm, Reliance Industries, on Monday opened in the negative territory, while its refining subsidiary Reliance Petroleum started the day on a bullish note on the Bombay Stock Exchange.Source: Zee News : Business | 2 Mar 2009 | 12:40 pm AIG to get $30 bn aid from US govt!US insurance company AIG will receive an additional USD 30 bn in federal assistance.Source: Zee News : Business | 2 Mar 2009 | 12:40 pm EU rejects eastern Europe bailout!EU leaders ruled out on Sunday a regional bailout plan for eastern Europe despite a Hungarian warning of a "new iron curtain" while rejecting protectionism as a response to the economic crisis.Source: Zee News : Business | 2 Mar 2009 | 12:40 pm RIL, RPL boards give nod to mega merger!The board of Mukesh Ambani-owned Reliance Industries Limited (RIL) agreed to merge with Reliance Petroleum Limited (RPL), making it one of the largest refiners in the world. The merger takes effect from April 1, 2008.Source: Zee News : Business | 2 Mar 2009 | 12:40 pm Rupee falls to 51.55 a dollar in early trade !Continuing its fall for the sixth consecutive day, the Indian rupee today depreciated by 43 paise against the greenback in opening trade.Source: Zee News : Business | 2 Mar 2009 | 12:40 pm RILRPL merger: New entity to emerge stronger, say expertsThe RILRPL merger will strengthen the books and cash flows for Reliance.Source: Moneycontrol Top Headlines | 2 Mar 2009 | 12:39 pm EC announces 5-phase election from 16 April to 13 MayNew Delhi: India will hold a general election between 16 April and 13 May, election officials said on Monday, kicking off a mammoth process in which 714 million people will be able to cast their votes. The chief of the Election Commission, which runs elections in the world’s largest democracy, said counting of ballots will take place on 16 May. The main battle will be between the Congress-led coalition and the leading opposition bloc, headed by the Bharatiya Janata Party (BJP). Chief election commissioner N. Gopalaswami told reporters voting would be held in five phases. “The process of finalising the election schedule takes into account the school examinations ... the local holidays ... festivals, the harvest season and so on,” he said.  Chief election commissioner N Gopalaswami along with election commissioners Navin Chawla (R) and SY Qureshi, at a press conference in New Delhi on Monday. Vijay Kumar Joshi / PTI Analysts so far see no party emerging with a clear majority from the election, which could mean weeks or even months of political uncertainty as parties negotiate for power. If the alliances headed by the national parties -- the Congress and BJP -- fail to win power a loose coalition of smaller parties known as the Third Front could come to office. Chief among these are the communists, who thwarted pro-reform policies while supporting the incumbent Congress-led coalition. India could see a rise in protectionism and few financial reforms if the Third Front comes to power. While the financial crisis and security are seen as national issues, many experts say the vote could be dominated by a myriad of caste and regional alliances and local issues. Economic Slowdown The election comes amid a decline in the economy which is expected to expand 7.1% in fiscal 2008-09, the slowest pace in six years. Domestic demand has slumped and exports have dipped sharply. But it is still unclear how the slowdown will play out with the majority voters in the countryside where government financial help to the farm sector and a landmark jobs scheme have lifted millions out of poverty. Inflation has also fallen. Analysts say the Congress has been able to checkmate opposition criticism over poor security after the Mumbai attacks by introducing a new terror law, improving security, changing the country’s home minister and raising defence spending. But another terrorist strike before the election could put terrorism on the top of the voter agenda. The month-long vote would see about four million election workers -- about half of them security personnel -- manning more than 800,000 polling stations. Around 1.1 million electronic voting machines will be used across the nation to elect 543 members for the 15th Lok Sabha. Gopalaswami said voting would be held in five phases in Jammu and Kashmir and in Uttar Pradesh which sends the single biggest number of lawmakers to Parliament. Elections are staggered in four phases in Bihar which has a history of poll-related violence. With just a month and a half to go, parties are reaching out to each other for pre-election tie-ups. The Congress said on Sunday it was allying with the regional Trinamool Congress Party in West Bengal state, a long-standing communist stronghold. Source: Home - Livemint.com | 2 Mar 2009 | 12:36 pm Maruti Feb sales jump, defying sector woes - Reuters India
Source: Google News India - Business | 2 Mar 2009 | 12:33 pm Manufacturing, exports data show grim Indian outlookMUMBAI (Reuters) - Indian manufacturing activity shrank for a fourth straight month in February and exports fell again in January, showing the economy remained under pressure in early 2009 and bolstering expectations of a rate cut.Source: Reuters: Money News | 2 Mar 2009 | 12:33 pm Mahindra passenger car sales marginally up in FebruaryIndian auto major Mahindra and Mahindra recorded 2.7 percent year-on-year growth in passenger car sales last month, the company said Monday.Source: IndiaeNews.com: Business News | 2 Mar 2009 | 12:31 pm Protest against Jindal Steel, Hindalco projects in JharkhandHundreds of farmers staged a protest here Monday against the acquisition of land for projects envisaged by aluminium major Hindalco, and steel manufacturer Jindal Steel and Power.Source: IndiaeNews.com: Business News | 2 Mar 2009 | 12:31 pm Maruti Feb sales jump, defying sector woesMUMBAI (Reuters) - Maruti Suzuki India Ltd, India's leading car maker, increased sales by nearly a quarter in February from a year, defying a broad downtrend in the industry, but its shares fell marginally.Source: Reuters: Money News | 2 Mar 2009 | 12:28 pm Markets slide 3.2% on economic pessimismNew Delhi: The stock markets closed more than 3% down on Monday on weak overseas trend and the economic pessimism. The Bombay Stock Exchange’s sensitive index, or Sensex, closed 284.53 points down, or 3.2%, at 8.607.08. The National Stock Exchange’s index Nifty ended 89.05 points lower at 2674.60. Government data showed India’s January exports declined an annual 15.9% to $12.38 billion, a fourth straight fall due to low demand of Indian goods because of global slowdown. Country’s economy has slowed to its weakest in almost six years in the December quarter to 5.3%. Reliance Industries Ltd, (RIL) closed 3.15% down at Rs1,225.15, on its move to absorb it unit Reliance Petroleum Ltd (RPL). It announced share swap ratio of 1 share for every 16 shares held in its 70% owned unit. Small cap index closed 56.73 points down at 3040.28, Mid cap index ended 57.31 points lower at 2700, BSE 200 closed 31 points down at 1013.88 and BSE 500 ended 93.02 points lower at 3139.09. Other losers of the day are ONGC at Rs664.05, Rs27.10 low; RCOM at Rs145.35, Rs10.10 low; REL Infra at Rs445.85. Rs44.75 low; SBI at Rs 995.25, Rs31.85 low; Sunpharma at Rs994.20 at Rs20.25 low; Tata Power at Rs711.70, Rs14. 70 low and Tata Steel Rs159. 35, Rs13 low. Source: Home - Livemint.com | 2 Mar 2009 | 12:18 pm Need for cash led to lowering ASARCO bid: SterliteSterlite Industries which is a part of the Vedanta Group has cut its bid for ASARCO. The new bid is in the region of USD 1.4 billion and USD 1.5 billion; earlier, the bid was pegged at a much higher USD 2.6 billion. Explaining the move, Anil Agarwal Chairman of the Vedanta Group, said they have to preserve cash now.Source: Moneycontrol Top Headlines | 2 Mar 2009 | 12:12 pm European stocks plummet, led by AIG lossLondon: European shares were lower at midday on Monday, led by financials after American International Group (AIG) reported a $61.7 billion quarterly net loss and HSBC announced Britain’s largest ever rights issue. By 1143 GMT, the pan-European FTSEurofirst 300 index of top shares was down 4% or 691.05 points trading at a six year low and just off a lifetime low of 681.17 points. “Everyone had lingering hopes that by the time we were moving towards the end of the first quarter there would be signs the banking industry and world economy would be stabilizing and the pace of declines would be lessening. However, it appears the downward trend is picking up pace,” said Jim Wood-Smith, head of research at Williams de Broe. Banks were the biggest fallers on the index. HSBC lost 19.6% as it launched a £12.5 billion rights issue after annual profits more than halved. Sandy Chen, analyst at Panmure Gordon, said: “We interpret HSBC’s move as a signal that management does not expect a recovery in global macro for a long time. In HSBC, we see vulnerability to the collapse in world trade and rising balance sheet risk.” UBS fell 7.1% after its new chief executive was quoted as saying it could take two to three years to bring it back to making a sustainable profit. Banco Santander, BNP Paribas and Credit Suisse were down 7.6 to 9.2%. Insurers were also in the doldrums on concerns they may need to raise capital through rights issues. Axa, Allianz and Swiss Re fell 4.4 to 7.6%. AIG’s $61.7 billion fourth-quarter loss was the largest quarterly loss in US corporate history and is its fifth consecutive quarterly loss, bringing total losses over that period to $100 billion. AIG shares in Frankfurt were up 7.5%, lifted by the bailout news. Oil stocks were under pressure as crude fell 4.8%. BG Group, BP, Royal Dutch Shell and Total were down 1.7 to 3.75%. There were no sectors in positive territory. In individual movers on the upside, Dutch supermarket group Ahold was up 2% after it reported that its fourth-quarter operating profit rose 49%, thanks to its revamped US grocery stores and a solid base in its home market. Amlin was up 3.1% after the group said the outlook for 2009 and 2010 underwriting is improving and increased its dividend (paid and proposed) by 13.3% to 17.0 pence per share. In economic news, Euro zone February inflation staged a surprise rebound and was up to 1.2%, compared to 1.1% in January. Meanwhile, the Euro zone manufacturers had their worst month in at least 12 years in February as a recession showed no signs of easing and firms slashed jobs. “In January there were signs of stabilization and that gave some hope that a bottom may have been reached. This and other surveys cast doubt on that and suggest Q1 growth in the euro zone could be as bad as Q4, which was pretty disastrous,” said Dominic Bryant at BNP Paribas. Across Europe, the FTSE 100 index was down 4.4%, Germany’s DAX was down 3.1%, France’s CAC 40 was 3.6% lower, and the broader DJ Stoxx 600 index was down 3.9%. Source: Home - Livemint.com | 2 Mar 2009 | 11:56 am Edserv IPO: Will 50% allotment to QIBs affect stock ahead? - Moneycontrol.com
Source: Google News India - Business | 2 Mar 2009 | 11:55 am BSE Sensex slides 3.2 pct on economic woesMUMBAI (Reuters) - The BSE Sensex fell 3.2 percent on Monday to its lowest close in more than three months as bleak economic data and sliding world markets added to the gloom, while the rupee slumped to record lows.Source: Reuters: Money News | 2 Mar 2009 | 11:51 am Highlights of RILRPL mergerHighlights from the RILRPL merger: a). RPL shareholders to get 1 Share of RIL for every 16 shares held b). RIL to cancel holding in RPL c). RIL to extinguish 13% treasury stock d). Merger effective retrospectively from April 1, 2008 e). Merger ratio in favour of RPLSource: Moneycontrol Top Headlines | 2 Mar 2009 | 11:41 am Dismal start to trading week, Sensex dives 3.2 percentIndian equities markets pulled down shutters in the red Monday as investors started offloading stocks both in Indian and global markets alike. A key index ended trade 3.2 percent below its previous close.Source: IndiaeNews.com: Business News | 2 Mar 2009 | 11:31 am Birla Tyres resumes production at Orissa plantBirla Tyres, a unit of the BK Birla Group company Kesoram Industries, resumed production at its Orissa plant Monday, a company official said.Source: IndiaeNews.com: Business News | 2 Mar 2009 | 11:31 am Tata Communications, Etisalat jointly launch ethernet servicesTata Communications and the United Arab Emirates (UAE)-based telecom giant Etisalat Monday jointly announced the launch of ethernet services in the emirates.Source: IndiaeNews.com: Business News | 2 Mar 2009 | 11:30 am HSBC to slash 6,100 jobs in USLondon: Europe’s largest bank HSBC will be cutting as many as 6,100 jobs in America, as the entity has decided to close down majority of its business network for consumer finance segment. The job losses come as the bank would cease to write new consumer finance business through the HFC and Beneficial brands in the US. Household Bank is a trading name of HFC Bank Ltd, which is a member of the HSBC Group. “... we will close the majority of the HFC and Beneficial-branded US branch network, regrettably with the loss of 6,100 jobs. This will result in a restructuring charge of $265 million in the first half of 2009,” HSBC today said in a statement while announcing its annual results. The firm has reported a pre-tax profit of $9.3 billion for the full year 2008, a decline of 62% as compared to the year-ago period. HSBC attributed the decision not to write new consumer business, to lack of home equity, the deteriorating outlook for house price appreciation and very limited refinancing opportunities available to this customer segment in the near term. Source: LatestNews-Home - Livemint.com | 2 Mar 2009 | 11:25 am Sahara to invest Rs4,000 cr for hospital-chainNew Delhi: In line with its plans to become a national player in the domestic healthcare sector, diversified business conglomerate Sahara will invest up to Rs4,000 crore over the next 10 years in setting up chain of 217 secondary hospitals across the country. “We are planning to set up a chain of 217 secondary care hospitals in each of our 217 up coming townships (Sahara City Homes). These hospital would come up with an estimated investment of Rs15-20 crore each,” said Sahara Prime City Head Infrastructure and Housing Sushanto Roy. The company had earlier announced its plans for setting up Sahara City Homes at more than 217 locations and the hospitals would come up in these areas. The hospitals would be designed in such a way that they could be linked to three proposed super specialty hospitals of the group through telemedichine technology, Roy said. When asked about details of the investment, Roy said, “Funding for these hospitals would be provided through a mix of debt, internal accruals and private equity.” Real estate arm of the company, Sahara Prime City will be responsible for its healthcare business and has also announced the proposal to set up three superspeciality hospitals, one each in Lucknow and Gorakhpur in Uttar Pradesh and in Mumbai, with an estimated investment of over Rs2,000 crore. It would also build the Sahara City Homes. Source: LatestNews-Home - Livemint.com | 2 Mar 2009 | 11:14 am Boards' nod for RIL-RPL merger;to be among top 20 oil refinersRIL set April 1 for the date for amalgamation with RPL after boards of the two firms at separate meetings agreed on the share swap.Source: Daily News & Analysis: Money News | 2 Mar 2009 | 11:11 am Amazon.com backtracks on Kindle text-to-speechSeattle: Amazon.com Inc. changed course and said it would allow copyright holders to decide whether they will permit their works to be read aloud using the second-generation Kindle electronic reader’s new text-to-speech feature. The move comes nearly two weeks after a group representing authors expressed concern that the feature, which was intended to be able to read every book, blog, magazine and newspaper out loud, would undercut separate audiobook sales. The Kindle can read text in a somewhat stilted electronic voice. Amazon said in a statement that it, too, has a stake in the success of the audiobook market, and pointed to its Brilliance Audio and Audible subsidiaries, which publish and sell professionally recorded readings. “Nevertheless, we strongly believe many rights holders will be more comfortable with the text-to-speech feature if they are in the driver’s seat,” the company said. Amazon is working on the technical changes needed for authors and publishers to turn text-to-speech off for individual titles. The Web retailer also said the text-to-speech feature is legal, and wouldn’t require Amazon to pay out additional royalties, because a book read aloud doesn’t constitute a copy, a derivative work or a performance. Source: LatestNews-Home - Livemint.com | 2 Mar 2009 | 11:09 am Amazon.com backtracks on Kindle text-to-speechSeattle: Amazon.com Inc. changed course and said it would allow copyright holders to decide whether they will permit their works to be read aloud using the second-generation Kindle electronic reader’s new text-to-speech feature. The move comes nearly two weeks after a group representing authors expressed concern that the feature, which was intended to be able to read every book, blog, magazine and newspaper out loud, would undercut separate audiobook sales. The Kindle can read text in a somewhat stilted electronic voice. Amazon said in a statement that it, too, has a stake in the success of the audiobook market, and pointed to its Brilliance Audio and Audible subsidiaries, which publish and sell professionally recorded readings. “Nevertheless, we strongly believe many rights holders will be more comfortable with the text-to-speech feature if they are in the driver’s seat,” the company said. Amazon is working on the technical changes needed for authors and publishers to turn text-to-speech off for individual titles. The Web retailer also said the text-to-speech feature is legal, and wouldn’t require Amazon to pay out additional royalties, because a book read aloud doesn’t constitute a copy, a derivative work or a performance. Source: Tech News - Livemint.com | 2 Mar 2009 | 11:09 am Reliance creates biggest refining opsMUMBAI (Reuters) - Reliance Industries, India's largest listed firm, said it is to absorb its 70 percent-owned Reliance Petroleum unit through a share offer, creating the world's largest refining complex.Source: Reuters: Money News | 2 Mar 2009 | 11:05 am Slowdown may impact social sector allocations: Plan panelThe economic slowdown will impact allocations to social sectors in the 11th Five-Year Plan, said a top Planning Commission official here Monday.Source: IndiaeNews.com: Business News | 2 Mar 2009 | 11:00 am India lifts import ban on Chinese toysIndia on Monday, lifted the ban on importing toys from China provided they conform to international safety norms.Source: Daily News & Analysis: Money News | 2 Mar 2009 | 10:56 am India condemns BDR mutiny, stands by neighbourNew Delhi: Viewing the mutiny in Bangladesh as an effort to destabilize the Sheikh Hasina government, India on Monday expressed solidarity with her dispensation and conveyed readiness to extend whatever support and assistance that Dhaka may require at the present juncture. External affairs minister Pranab Mukherjee wrote to the Bangladesh prime minister expressing “great shock” at the tragedy that has unfolded over the last few days there. In his letter, Mukherjee noted “such barbaric acts (mutiny by BDR men) had no place in a civilised society,” external affairs ministry spokesman Vishnu Prakash said. “He (Mukherjee) unequivocally condemned the same as also all efforts aimed at destabilising a democratically- elected government (in Bangladesh),” the spokesman said. The external affairs minister expressed solidarity with Hasina and her government in “this hour of difficulty” and said “India stands ready to extend whatever support and assistance that Bangladesh may require at this juncture.” Mukherjee also conveyed deepest condolences of the government and people of India and on his own behalf to the government, the Bangladesh Army and the families of those who lost their near and dear ones in the incidents. BDR personnel stormed the force’s headquarters last week and massacred at least 73 military personnel, including their chief, a Major General-rank officer from army, before surrendering. Source: LatestNews-Home - Livemint.com | 2 Mar 2009 | 10:54 am Markets move south, Sensex 284 points downIndian equities markets closed in the red Monday, with a key index ending trade 3.2 percent lower than its previous close.Source: IndiaeNews.com: Business News | 2 Mar 2009 | 10:32 am N Korean satellite launch would trigger UN sanctions: AsoTokyo: Japan’s prime minister Taro Aso signalled on Monday that a North Korean rocket launch, even one carrying a satellite, would lead to UN Security Council sanctions against the communist state. North Korea has said it is preparing to fire a rocket for what it calls a satellite launch, although the United States and South Korea say its purpose is to test a missile that could theoretically reach Alaska. Aso said if the North goes ahead with a launch, “in any case, it will be discussed at the UN Security Council,” local media reported. The premier made the remark after his Foreign Minister Hirofumi Nakasone said in Beijing at the weekend that any rocket launch by Pyongyang would violate a UN Security Council resolution. In 2006, the UN body imposed sanctions on North Korea for a similar missile test that Pyongyang had insisted was a satellite launch. South Korea’s Yonhap news agency earlier said a launch may come in late March or early April, as a US-South Korean military exercise is scheduled for March 9-20 and a US-South Korea summit is set to take place on the sidelines of the 2 April G20 meeting in London. Source: LatestNews-Home - Livemint.com | 2 Mar 2009 | 10:32 am RIL-RPL merger: Who benefits?India’s most valuable company (by market capitalization) – Mukesh Ambani-controlled Reliance Industries Limited (RIL) has decided to absorb its Reliance Petroleum Limited (RPL) unit through a share swap arrangement. RIL said it would issue one share for every 16 held in the unit, giving it direct control of the world’s largest refinery complex. Below is the analysis from top brokerage houses across the country on the deal and who stands to benefit in the scheme of arrangement. Angel Broking RIL currently holds 70.4% stake in RPL, which is likely to increase to 75.4% on account of Chevron selling its stake back to RIL. The merger is likely to strengthen RILs’s cash flow and balance sheet. RPL has incurred huge capex towards commissioning its refinery and is likely to generate positive free cash flow (FCF) going forward. Thus, the proposed merger would help RIL utilise this Cash flows in its other business verticals in a fruitful manner. Alternatively, if RPL would have been maintained as a separate entity and had paid dividend to RIL, it would have attracted dividend distribution tax of 17.99%. Thus, the merger allows RIL flexibility in using RPL’s Cash flows. The proposed merger could benefit RIL in taking advantage of RPL’s depreciation. While calculating book profit, RIL would be entitled to take SEZ benefit for RPL’s refinery unit and while calculating taxable income for the year, RIL could avail the benefit of depreciation tax shield. However, things are still unclear whether RIL would actually benefit from the same. Who benefits from the merger? The beneficiary of the merger would depend on the swap ratio. In mergers the swap ratio is determined based on the intrinsic value of the respective companies, which is in turn decided based on various parameters, ie. market value based swap ratio, book value based swap ratio, etc. As per the 27 February 2009 closing price of RIL and RPL, the swap ratio works out to 1 share of RIL for every share 16.6 share of RPL. However, on book value basis, the ratio works out to be adverse for the RPL shareholders. We believe given that RPL is yet to commence production from its new refinery the book value based swap ratio would not be an ideal indicator for fixing a swap ratio. The case also strengthens from the fact that RPL’s IPO price was fixed at Rs60/share much above the book value of Rs29/share of the company. Thus, a book value based swap ratio does not serve any purpose in this case. We believe swap ratio in the range of 16-17x will be Neutral for both companies. Since RPL’s listing, the hypothetical swap ratio between RIL and RPL has been in the range of 21 - 10x, giving an average of 15.7x and median of 15.3x. However, if the ratio is more than around 18x, it would be adverse for RPL shareholders. While any swap ratio of more than 20x would be beneficial for RIL shareholders. At Rs1,265, the stock is trading at 12.3x FY2009E and 9.7x FY2010E earnings. We maintain a BUY on the stock, with a Target Price of Rs1,440. Merger ratio favours RPL shareholders: BRICS Securities Merger has no rating impact on RIL: S&P Reaffirm ratings on RIL, RPL: Crisil Source: LatestNews-Home - Livemint.com | 2 Mar 2009 | 10:32 am India lifts Chinese toy ban, seeks safety guaranteesNew Delhi: India on Monday lifted a ban on imports of Chinese toys after Beijing warned the move could seriously jeopardize bilateral trade ties. The trade ministry said Chinese toys could be imported but needed to be certified as safe according to international standards. In January the government barred imports of Chinese toys for six months on the grounds of “public health and safety”—drawing strong condemnation from Beijing which warned trade ties could be “seriously impacted.” But on Monday, the ministry said Chinese toy imports “shall be permitted” if accompanied by certificates showing they “conform to standards prescribed” by safety bodies such as the International Organisation for Standardization (ISO) or the American Society for Testing and Materials (ASTM). Source: LatestNews-Home - Livemint.com | 2 Mar 2009 | 10:19 am Chevron to get Rs1,350 cr for offloading stake in RPLMumbai: Reliance Industries Monday said it will buy back US energy major Chevron’s 5% stake in Reliance Petroleum for Rs1,350 crore at Rs60 a share. “The shares will be bought at Rs60 a share, as per the agreement,” RIL’s Chief financial officer Alok Agarwal told reporters here. Chevron had acquired 22.50 crore shares in RPL as part of an Equity Investment Agreement with RIL in April 2006. As per the deal, RPL and Chevron were to enter into agreements on crude supply and product offtake. On executing these agreements and other pacts, Chevron was to purchase an additional 24% stake in RPL from RIL. The Equity Investment Agreement also provided that, in case these agreements were not executed, Chevron would sell and RIL shall buy the former’s 5% holding in RPL. “We are going to exercise that right to buy the shares,” Agarwal said, adding that RIL would continue to have its ongoing business relations with Chevron. An RIL statement had earlier said, “Chevron, RIL and RPL have jointly decided not to proceed with the conclusion of these agreements. Consequently, RIL shall purchase 22.50 crore shares of RPL from Chevron.” Source: LatestNews-Home - Livemint.com | 2 Mar 2009 | 10:11 am Reliance announces share ratio for petroleum unit takeoverMumbai: Reliance Industries on Monday decided to absorb its Reliance Petroleum unit through a share swap, a strategy which will boost its earnings potential without diluting its capital greatly. Reliance Industries, India’s largest listed firm, said it would issue one share for every 16 held in the unit, giving it direct control of the world’s largest refinery complex. Shares in Reliance Industries fell as much as 4.1% as the swap ratio gave a slight edge to Reliance Petroleum shareholders, traders said, but the move to fold the unit into the parent is expected to help the company in the long run. “The merger will unlock significant operational and financial synergies that exists between RIL and RPL,” Reliance Industries said in a statement. ”There will be further gains from reduced operating cost arising from synergies of combined operations.” Also Read Bid to boost cash flow amid crunch Reliance, which owned 70% of the unit, said it would cancel the shares on the absorption. It also said it would buy Chevron Corp’s 5% in Reliance Petroleum. This would give Reliance the unit’s 580,000-barrel-per-day refinery built at $6 billion and commissioned in December for a fraction of the cost on its books. “It ensures the increase in equity is kept to the bare minimum to boost all ratios such as EPS and return on equity,” Ambareesh Baliga, vice president at Karvy Stock Broking, said. Reliance has used this strategy in the past by launching new companies to build large projects and then folding them back in when the projects begin operation. Baliga said this helps to keep risks linked to new projects away from the parent until they began production. The new refinery is located next to Reliance Industries’ 660,000-bpd refinery in Jamnagar. The combined firm would have refining capacity of 1.24 million barrels per day, the largest in the world. Analysts said the amalgamation would provide some savings to Reliance and boost its financial muscle. “Operational synergies are likely in the form of cost optimization and better negotiating ability for buying crude,” analysts Niraj Mansingka and Ruchi Vora at Edelweiss Securities said in a research note. “There could be potential saving on dividend distribution tax,” they said, adding Reliance will also benefit from a bigger balance sheet that would give it muscle to raise funds for expansion. The founders shareholding in Reliance Industries will fall to 47% from 49% following the absorption. At 0607 GMT, Reliance Industries shares were down 2.3% at Rs1,235.90, while Reliance Petroleum was down 0.4% at Rs75.80 after rising 7.6% in early trade, in a Mumbai market that dropped 2.5%. Source: Home - Livemint.com | 2 Mar 2009 | 9:33 am Fidelity ramps up stake in Satyam to 10.17%Fidelity has increased its stake in Satyam Computer to 10.17% through open market deals.Source: Daily News & Analysis: Money News | 2 Mar 2009 | 8:40 am Vedanta to invest in India to become world's 5th largest coNRI billionaire Anil Agarwal-led Vedanta Group will pump in a whopping Rs 70,000 crore in India by 2011-12, a stride that will make it the world's fifth largest metal and mining entity.Source: Daily News & Analysis: Money News | 2 Mar 2009 | 8:37 am Duty cuts to help reduce cement, steel, vehicle pricesNew Delhi: The excise duty cuts announced by the government last week will help lower retail prices for a variety of products such as cement, steel and heavy vehicles, and boost their demand, according to a survey by an industry group. Retail prices of bulk cement can drop by about Rs3 per bag, while steel prices are expected to come down by Rs500-750 a tonne, the survey by Federation of Indian Chambers of Commerce & Industry (Ficci) showed. The tax cuts will help commercial vehicles and cargo goods carriers, whose prices are expected to fall by Rs2000-30,000 in different categories of vehicles, although two-wheeler manufacturers will not benefit much, Ficci said. Textiles, which has been hit by global economic downturn, is also unlikely to see any drop in prices as it doesn’t benefit from the measures unveiled, the survey said. Since December, India has cut excise duties and service tax rates, apart from easing monetary policy stance to lift demand in a slowing economy. The economy grew 5.3% in the December quarter, its slowest annual pace in almost six years, a far cry from annual growth of 9%-plus recorded in the last three years. The government has said it expects the economy to end the current fiscal with a growth of 7.1%, but many economists consider it to be too optimistic. Source: Home - Livemint.com | 2 Mar 2009 | 7:10 am RIL - RPL merger to create largest petrochemical firmsMumbai: The merger of Reliance Industries Ltd (RIL) with Reliance Petroleum Ltd (RPL) will enhance value for shareholders of both the firms and is a major step towards creating one of the largest petrochemical firms of the world, RIL chairman and managing director Mukesh Ambani said. Commenting on the merger, Ambani said, “this merger follows Reliance Industries’ philosophy of creating enduring value for all our shareholders. It is a significant step in our goal to be among the largest global corporations”. The board of directors of RIL and its refinery subsidiary RPL on Monday approved the merger of the two firms, creating one of the world’s largest petrochemical entity and offered the shareholders of RPL one RIL share for every 16 shares held by them. Pursuant to the said merger, RIL’s holding in RPL would be cancelled and RIL would issue 6.92 crore new shares thereby increasing its equity capital to Rs1,643 crore. Besides, this would result in a 4.4% increase in equity base from Rs1,574 crore to Rs1,643 crore. Accordingly, the promoter holding in RIL would reduce from 49% to 47%. Upon the completion of the merger, RIL would have as many as 3,7 million shareholders. Source: Home - Livemint.com | 2 Mar 2009 | 6:55 am Rupee hits all-time low of 51.93/94 vs dollarExtending its losses to sixth day in a row, the Indian rupee on Monday hit a new life-time low of 51.81/82 against the American currency in morning trade.Source: Daily News & Analysis: Money News | 2 Mar 2009 | 6:48 am Sensex plunges by 285 points to 8,607.08Indian bourses witnessed a virtual meltdown with the benchmark 30-share index plunging by 284.53 points to over a three-month low of 8,607.08.Source: Daily News & Analysis: Money News | 2 Mar 2009 | 6:46 am RIL-RPL merger approved by respective boardsThe Board of Directors of Reliance Industries and its refinery subsidiary RPL on Monday approved the merger of the two firms, creating one of the world's largest petrochemical entity.Source: Daily News & Analysis: Money News | 2 Mar 2009 | 6:44 am Merger to create one of largest petrochemical firms: AmbaniThe merger of Reliance Industries with Reliance Petroleum is a major step towards creating one of the largest petrochemical firms of the world, said Mukesh Ambani.Source: Daily News & Analysis: Money News | 2 Mar 2009 | 6:42 am India manufacturing shrinks for fourth month in February: PMIMumbai: Indian manufacturing activity shrank for a fourth straight month in February as the global downturn hurt demand and soured business sentiment, a survey showed on Monday. The ABN AMRO Bank purchasing managers’ index (PMI) , based on a survey of 500 companies, rose to a seasonally adjusted 47.0 in February from January’s 46.7. A reading above 50 signals economic expansion while a figure below 50 suggests contraction. Manufacturing makes up about 16% of India’s gross domestic product. India’s once-roaring economy has slowed much more than expected in recent months, slumping to its weakest pace in almost six years in the October-December quarter as the global financial crisis slashes demand for its exports and prompts consumers to cut spending. Banks have also grown more averse to extending loans, further throttling economic growth. Indian policymakers have responded to the slowdown with a slew of steps aimed at shoring up faltering demand. The Reserve Bank of India (RBI) has aggressively cut its policy rates since mid-October, and expectations of further cuts are growing. The economy grew 5.3% in the December quarter, the government said on Friday, below forecasts of 6.2% and the previous quarter’s growth of 7.6%. Both the central bank’s short-term lending and borrowing rates are at their lowest levels, 5.5% and 4% respectively, since the policy rates were introduced in 2000. Earlier this month, the government forecast the economy would expand 7.1% in the 2008-09 fiscal year ending in March, but signs are growing that global economic conditions have been steadily worsening. The PMI survey, which is compiled by UK-based Markit Group, comes well ahead of official statistics. Government data showed industrial output rose an annual 2.4% in November. Source: Home - Livemint.com | 2 Mar 2009 | 6:04 am HSBC to launch $18 bn rights issue to shore up balance sheetLondon: HSBC will on Monday launch a rights issue to raise up to $18 billion to shore up a balance sheet showing strain from a sharp rise in bad debt in the United States, people familiar with the matter said. The bank’s Hong Kong-listed shares were suspended from trading on Monday before the opening of the market, and the bank moved up a scheduled media briefing by 45 minutes to 0800 GMT. HSBC, which at Friday’s close was worth half the market value of Industrial and Commercial Bank of China Ltd (ICBC), will unveil the cash call early on Monday in London alongside 2008 results that will show profits fell by about a fifth as recession deepens across the world. HSBC will seek to raise as much as $18 billion, one person familiar with the matter told Reuters on Saturday. Goldman Sachs, JPM Cazenove and HSBC will underwrite the offer, sources said. HSBC is also expected to slash its dividend and further shrink its US consumer loans business. The London-based bank declined to comment. HSBC is already running down much of its US loan book, and its US subprime consumer lending operations will be closed to new business, the Financial Times reported, adding HSBC will also write off much of the goodwill on its balance sheet associated with its Household business, the report said. Bad debts are also rising in Europe and Asia. The rights issue would be the biggest in Britain if it surpasses the £12 billion raised by crisis-struck rival Royal Bank of Scotland last April. Several investors told Reuters last week they would support a rights issue, and wanted management to act quickly to remove uncertainty hanging over its share price. “We’re not too worried about the fund raising. The question is the market’s perception of the plan, whether the amount they’re going to raise is enough or not,” said Y.K. Chan, a fund manager at Philip Capital Management in Hong Kong. “The reaction to the plan could be very extreme and there will be a tug-of-war in the market,” he said. Shares are likely to be sold at a discount of 35-40%, one source said. HSBC has traditionally been one of the best capitalized banks in the world and has not raised capital while others scrambled for cash as the credit crisis deepened. But while it may be able to ride out the storm, a delay may make any cash call it needs at a later stage more painful and investors may prefer to raise the cash now. HSBC is expected to report a 22% fall in annual profits to $19 billion, according to a consensus of analysts polled by Reuters Estimates. Its bad debts are forecast to jump to $22-$24 billion from $17 billion, largely due to North American impairments of around $16 billion, analysts estimate. That stems from its troubled acquisition of Household, the US consumer lending business bought six years ago for $14 billion. HSBC’s Tier-1 capital was 8.9% at end-September, above the European average and near the top of its targeted range of 7.5% to 9%. Its fundraising would give the bank one of the strongest capital positions in the world, with a Tier-1 ratio probably of over 10%. Source: World Business - Livemint.com | 2 Mar 2009 | 5:53 am HSBC to launch $18 bn rights issue to shore up balance sheetLondon: HSBC will on Monday launch a rights issue to raise up to $18 billion to shore up a balance sheet showing strain from a sharp rise in bad debt in the United States, people familiar with the matter said. The bank’s Hong Kong-listed shares were suspended from trading on Monday before the opening of the market, and the bank moved up a scheduled media briefing by 45 minutes to 0800 GMT. HSBC, which at Friday’s close was worth half the market value of Industrial and Commercial Bank of China Ltd (ICBC), will unveil the cash call early on Monday in London alongside 2008 results that will show profits fell by about a fifth as recession deepens across the world. HSBC will seek to raise as much as $18 billion, one person familiar with the matter told Reuters on Saturday. Goldman Sachs, JPM Cazenove and HSBC will underwrite the offer, sources said. HSBC is also expected to slash its dividend and further shrink its US consumer loans business. The London-based bank declined to comment. HSBC is already running down much of its US loan book, and its US subprime consumer lending operations will be closed to new business, the Financial Times reported, adding HSBC will also write off much of the goodwill on its balance sheet associated with its Household business, the report said. Bad debts are also rising in Europe and Asia. The rights issue would be the biggest in Britain if it surpasses the £12 billion raised by crisis-struck rival Royal Bank of Scotland last April. Several investors told Reuters last week they would support a rights issue, and wanted management to act quickly to remove uncertainty hanging over its share price. “We’re not too worried about the fund raising. The question is the market’s perception of the plan, whether the amount they’re going to raise is enough or not,” said Y.K. Chan, a fund manager at Philip Capital Management in Hong Kong. “The reaction to the plan could be very extreme and there will be a tug-of-war in the market,” he said. Shares are likely to be sold at a discount of 35-40%, one source said. HSBC has traditionally been one of the best capitalized banks in the world and has not raised capital while others scrambled for cash as the credit crisis deepened. But while it may be able to ride out the storm, a delay may make any cash call it needs at a later stage more painful and investors may prefer to raise the cash now. HSBC is expected to report a 22% fall in annual profits to $19 billion, according to a consensus of analysts polled by Reuters Estimates. Its bad debts are forecast to jump to $22-$24 billion from $17 billion, largely due to North American impairments of around $16 billion, analysts estimate. That stems from its troubled acquisition of Household, the US consumer lending business bought six years ago for $14 billion. HSBC’s Tier-1 capital was 8.9% at end-September, above the European average and near the top of its targeted range of 7.5% to 9%. Its fundraising would give the bank one of the strongest capital positions in the world, with a Tier-1 ratio probably of over 10%. Source: Home - Livemint.com | 2 Mar 2009 | 5:53 am Fidelity raises Satyam stake to more than 10 pctNEW DELHI (Reuters) - Fidelity has raised its stake in embattled Indian outsourcer Satyam Computer Services by 0.27 percent to 10.17 percent through open market purchases, it said in a regulatory filing to the stock exchange on Monday.Source: Reuters: Money News | 2 Mar 2009 | 5:01 am Activity in private equity market picks up after a lullNew Delhi, March 1 Despite the global financial crunch, there’s renewed activity in the Indian private equity (PE) space.Source: Business Line - Home Page | 2 Mar 2009 | 12:00 am Petronet to raise Rs 2,200 cr for captive port project at KochiNew Delhi, March 1 Petronet LNG Ltd (PLL) plans to mobilise Rs 2,200 crore from the domestic and external markets to part-finance its captive port with re-gassification facilities at Kochi.Source: Business Line - Home Page | 2 Mar 2009 | 12:00 am Transaction-based pricing in favour: Infosys BPOBangalore, March 1 Infosys BPO said it was seeing traction with transaction-based pricing model as customers look to convert their capital expenditure to operational expenditure while fighting an economicSource: Business Line - Home Page | 2 Mar 2009 | 12:00 am Lack of trust weighs the markets downOne more week wore on, but the short-term outlook has not changed much for the better. The market’s expectation of stronger signals for interest rate cut remained elusive. Even if it becomes real shortly, it is likely to create anSource: Business Line - Home Page | 2 Mar 2009 | 12:00 am Withstanding the stimulusThe Interim Budget for 2009-10 announced on February 16 was dismissed by India Inc and the markets for its total lack of imaginative stimulating steps. Apparently stung by the reaction, the Finance Minister has now come forward with cuts in exciseSource: Business Line - Home Page | 2 Mar 2009 | 12:00 am Day Trading GuideSource: Business Line - Home Page | 2 Mar 2009 | 12:00 am Gold futures to test support levelsGold futures, ended lower, due to profit-taking and unwinding of long positions after five straight weeks of bullishness. As mentioned earlier, a stabilisation in stocks would likely to lead to profit-taking in the metal. There was resumption ofSource: Business Line - Home Page | 2 Mar 2009 | 12:00 am Kirloskar Brothers (Rs 79.90): BuyWe recommend a buy in Kirloskar Brothers stock from a short-term trading perspective. It is evident from the charts of Kirloskar Brothers that it had been on a long-term downtrend from its January 2008 high of Rs 520 to its January 2009 low of RsSource: Business Line - Home Page | 2 Mar 2009 | 12:00 am e-Bay model portal for small-time recruitersBangalore, March 1 For people like Pradeep Mukherjee, a laid-off recruitment consultant working with a leading placement firm, Zyoin.com has come at an opportune time.Source: Business Line - Home Page | 2 Mar 2009 | 12:00 am Nokia collects 3 tonnes mobile waste in 45 daysWith most Indians changing their mobile handsets every 18 months, the need to find safe ways to dispose of old mobile phones has grown.Source: Business Line - Home Page | 2 Mar 2009 | 12:00 am I made dumb decisions, admits greatest investorWarren Buffett has blamed himself for making certain "dumb" investment decisions last year, which cost his company billions of dollars.Source: Daily News & Analysis: Money News | 1 Mar 2009 | 10:44 pm Ravi Jaipuria to buy Pepsi's Bengal bottling plantBottling, restaurant and foods chain entrepreneur Ravi Jaipuria is expected to buy PepsiCo Indias West Bengal bottling plant in Sonarpur in a deal that will make him the global beverage-to-foods giants single largest bottler in India.Source: Business Standard | Front Page Headlines | 1 Mar 2009 | 6:59 pm Buffett hints at Indian successorAdmits to 'dumb' decisions.Source: Business Standard | Front Page Headlines | 1 Mar 2009 | 6:58 pm Outsource more from India: Airbus parent to suppliersEuropean aerospace major European Aeronautic Defence and Space Company (EADS), parent company of Indias largest aircraft supplier Airbus, has directed its European tier-1 outsourcing partners to direct a larger portion of their outsourcing orders from India.Source: Business Standard | Front Page Headlines | 1 Mar 2009 | 6:56 pm Satyam sale process this weekBid-pack for potential investors sent to CLB, Sebi.Source: Business Standard | Front Page Headlines | 1 Mar 2009 | 6:54 pm CA rules under government lensThe ministry of company affairs has begun a comprehensive review of the legal provisions and regulations governing chartered accountants following the Satyam accounting fraud that covers, among other issues, the operation of surrogate firms in India by large foreign audit firms.Source: Business Standard | Front Page Headlines | 1 Mar 2009 | 6:52 pm Leaders must change when they have to, not fear flip-flop labelAs a veteran of the Vietnam war, I can’t see an end to the conflict in Afghanistan or that our country (the US) has the ability to pay for it. Am I being pessimistic? —Jerry Helmert, Wisconsin We too are perplexed by President Barack Obama’s recent executive order authorizing the escalation of military operations in Afghanistan with the deployment of an additional 17,000 troops. If that country’s history has taught us anything, it’s that conventional warfare doesn’t work very well—to put it mildly—against the guerrilla tactics of “freedom fighters” defending that unfamiliar terrain. That’s why we hope the President will re-evaluate his position in the weeks ahead, and as he does, we hope too that he will not fall prey to the syndrome that afflicts virtually every leader who has ever stood at a podium to make a bold and defining pronouncement on strategy, as Obama promised to bolster the effort in Afghanistan when he was on the campaign trail. Click here to watch video Now, it’s hard to know exactly when “flip-flopping” first became a dirty word in the leadership lexicon. But in recent years this choice epithet has been hurled at political candidates on both sides of the fence, seriously damaging the campaigns, for instance, of John Kerry, the Democratic presidential nominee in 2004, and of Mitt Romney during his run for the Republican presidential nomination in 2008. In those cases, critics made it sound as though revising one’s stance on an issue was some kind of moral failing. What nonsense. Confronting the possibility that a strategy has gone off course or a position has become outdated is the essence of great leadership. And it is the responsibility of all leaders who find themselves in such a predicament to change direction swiftly, widely communicate the change, and move on without undue pandering or emotionality. Change happens. And so a leader’s mindset must change, too—under two broad circumstances in particular. But before we describe those circumstances, a quick caveat. We’re obviously talking here about “revisionism”, but within limits. There’s almost nothing more frustrating than a manager whose opinion changes according to the views of the last person to leave his office. Just as bad is a leader who changes his views depending on his audience, rolling out one set of talking points for the press, another for analysts, and yet another for employees. That’s nothing but weakness, which enervates the organization and soon catches up with any leader who indulges in the practice. Also See Jack and Suzy Welch’s earlier videos No, what we’re talking about is appropriate flexibility—the kind that legitimately occurs when a leader’s perspective is upended by new insights, or when the business environment is upended by unanticipated conditions. For an example of the first circumstance, consider what happened at General Electric Co. (GE) in the 1990s. For at least a decade, the company had an imperative that every product or service had to be first or second in market share, else its managers were to “fix, close or sell” the business. Then a group of managers returned from a leadership-training course—the No. 1 or No. 2 strategy, they said, wasn’t necessarily encouraging GE businesses to grow. More often it was impelling them to define their markets more narrowly. Instead of saying, for instance, “We are No. 1 in Product X,” they were saying, “We’re No. 1 in Product X—with one particular feature”—a winnowing that, for many businesses, could pump market share up into the 40% range.  It was announced that every business had to redefine its current markets so that it had no more than a 10% share. The change opened people’s eyes to a world of opportunities in adjacent markets, products and services, and the company’s growth rates increased dramatically. As for the second circumstance—an upended competitive environment—well we’re living it. Today’s marketplace is changing so rapidly that any leader holding fast to a “defining” strategy is in serious need of a kick in the pants, especially if that strategy is based on pricey brand exclusivity. Starbucks Corp. chief executive officer Howard Schultz is right when he says that the company must reinvent itself and sell items such as low-cost instant coffee and value meals. Granted, Starbucks’ revised strategy could muddy its high-end image, but given the realities of consumer spending, that’s the right sort of flexible mindset the company needs these days. Now, we’ll admit that it might seem like quite a stretch to start a column with the president and Afghanistan and end it with a discussion of strategy at Starbucks. But the underlying point we wanted to make holds true in both situations. For any leader, it’s dangerous to allow the perils of the “flip-flop” label to affect decision-making. In the right circumstances, changing your mind is change you can believe in. ©2009/BY NYT SYNDICATE Write to Jack & Suzy Jack and Suzy are eager to hear about your career dilemmas and challenges at work, and look forward to answering some of your questions in future columns. Jack and Suzy Welch are the authors of the international best-seller, Winning. Their latest book is Winning: The Answers: Confronting 74 of the Toughest Questions in Business Today. Mint readers can email them questions at winning@livemint.com Please include your name, occupation and city. Only select questions will be answered. Source: World Business - Livemint.com | 1 Mar 2009 | 4:37 pm Marissa Mayer: playing a pivotal role at GoogleMountain View, California: In December, Marissa Mayer was vacationing in Africa when her boss, Jonathan Rosenberg, emailed her asking if she was leaving Google Inc. It wasn’t a routine query. As the gatekeeper of Google’s home page, and one of the company’s most ubiquitous and closely watched public faces, Mayer controls the look, feel and functionality of the Internet’s most heavily trafficked search engine. Rumours of her possible departure had lit up the blogosphere and offices across Silicon Valley. None of it, she assured Rosenberg, was true. And Mayer, who is Google Employee No. 20 and the company’s first female engineer, still says she isn’t leaving; she says she has gone out of her way to inform Google’s founders, Larry Page and Sergey Brin, as well as CEO Eric E. Schmidt, that she is staying put. “It could not be further from the truth,” she says of gossip about her departure. “It made me realize that people don’t understand me.”  It girl: Mayer is the rare executive who has become a celebrity. Noah Berger / NYT As such, she has invited attention—and in some cases, derision—in the last year for such actions as creating spreadsheets to find the perfect cupcake recipe, attending lavish ballet, art and fashion galas, paying $60,000 (Rs30.42 lakh) at a charity auction to have lunch with Oscar de la Renta, and hosting breezy, dying-to-get-invited-to parties at her $5 million penthouse in San Francisco. Her live-out-loud lifestyle seems so un-Silicon Valley, but at the same time perfectly in tune with what Google is all about. “I refuse to be stereotyped,” she says. “I think it’s very comforting for people to put me in a box. ‘Oh, she’s a fluffy girlie girl who likes clothes and cupcakes. Oh, but wait, she is spending her weekends doing hardware electronics.’” Yet Mayer, 33, plays a pivotal, serious role at Google. Almost every new feature or design, from the wording on a Google page to the colour of a Google toolbar, must pass muster with her, or legions of Google users will never see it. She is one of the few Googlers with unfettered access to and influence over Brin and Page, and Valley wags wonder whether Google’s familiar white home page will even look the same if she leaves the company. “Knowing Marissa, if she were considering leaving Google, she’d do it in an orderly way,” says Rosenberg, who is Google’s senior vice-president for product management. Others have a different view. Matt Rabinowitz, a close friend who has known Mayer since their days on the Stanford debate team in the early 1990s, says he thinks she might move on. “Her quirkiness aligned beautifully with this moment in history when Google took over the Internet,” he says. “If she keeps growing at Google, she will stay there. There is nothing else like it now. She is in a position of leverage.” “That said,” he adds, “I don’t think she will.” When Mayer joined Google after graduating with a master’s degree in computer science from Stanford in 1999, the company was a shoestring start-up where nobody expected to get rich quick, let alone become billionaires. She started out writing code and overseeing small teams of engineers, carving out a niche for herself by developing and designing Google’s search offerings. An engineer at heart, she also had something that many of her peers did not during Google’s early days: a keen sense of style and design. She adored bold blocks of colour against a white background, much like the Marimekko prints that once hung in her childhood home in Wausau, Wisconsin. Her San Francisco penthouse has a similar, but more expensive, aesthetic. As vice-president for search products and user experience, Mayer has wedded her personal tastes with an ability to manage her bosses, including a capacity to easily communicate and champion ideas with Brin and Page, both of whom are also friends. Since joining Google, she has introduced at least 100 products and features, many of which have thrived: Google News, Gmail and Image Search, for example. Others, such as Orkut, have had a harder time finding an audience in the US. “She is a catalyst for winning ideas,” Rosenberg says. “Marissa has been through the evolution of the Google playbook. She is part author. That is very important because she understands the design aesthetic of Google.” In meetings with subordinates, Mayer comes across as a zealous copy editor or meticulous art teacher correcting first-semester students. With so many new recruits, she reasons, someone has to teach them how Google does things. Students of Google’s culture wonder whether Mayer and her management style would flourish outside the insulated world where her tenacity and curiosity mirror the company itself. “She clearly has what it takes to be a great manager at Google, but I don’t know if that translates into being a great manager at Hasbro,” said John Battelle, author of The Search: How Google and Its Rivals Rewrote the Rules of Business and Transformed Our Culture. Any transition, too, could be particularly challenging as the reputations of Mayer and others who were hired early on are so closely intertwined with the company. “You get comfortable being wealthy, getting attention, living in the bubble,” Battelle said. “It will be interesting to watch at which point they declare ‘who am I?’ by their definition, not Google’s.” Mayer says she is vexed by how some perceive her. “I am not a girl about town,” she says. “It isn’t how I project myself. It is how other people choose to project me.” Perhaps. But it also happens to be true that she enjoys talking about herself. Last summer, in an interview with Yelp, a website that tracks restaurants and other local services, she gushed over her favourite dry cleaner and shoe repair shop, and where to find the best pineapple malts in Palo Alto. Mayer also seems relatively carefree about her privacy. While photographs of her and her fiance Zachary Bogue, a private equity executive, are instant Internet fodder, she says she rarely turns down requests for her picture from Drew Altizer, a photographer she knows and often sees on the party circuit. “Drew is trying to pay me a compliment,” she says. Whatever Mayer chooses to reveal about herself publicly, Craig Silverstein, Google’s director of technology and a close friend, says that none of it is self-serving. “Marissa doesn’t care about the chattering classes,” he says. She likes shopping, fashion. And she is not going to stop just because people don’t like that.” Besides, Mayer says, there are some things that she hasn’t previously revealed about herself and that the media have overlooked. Like her self-described athletic prowess. “It hasn’t shown up anywhere that I am really physically active,” she says. “I ran the San Francisco half marathon this year. I did the Portland marathon. I went skiing just yesterday. I’m going to do the Birkebeiner, which is North America’s longest cross-country ski race. That just shows you how much there are gaps.” ©2009/THE NEW YORK TIMES Source: World Business - Livemint.com | 1 Mar 2009 | 4:37 pm
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