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Moser Baer to invest $5 bn in Chennai and Hyderabad plantsIn an exclusive interview with CNBCTV18, Yogesh Mathur, Group CFO of Moser Baer India, spoke on the benefits of the National Solar Mission and his companys expansion plans.Source: Moneycontrol Top Headlines | 16 Nov 2009 | 7:59 am Michelin to invest $870 mn in IndiaFrench tyre maker Michelin said on Monday it would invest 40 billion rupees (USD 870 million) to build a tyre manufacturing unit in Tamil Nadu.Source: Moneycontrol Top Headlines | 16 Nov 2009 | 7:34 am Glenmark outlicenses dermatology drug to Medicis PharmaGlenn Saldanha, MD and CEO of the company, speaks about the product.Source: Moneycontrol Top Headlines | 16 Nov 2009 | 6:09 am JLR secures GBP 170 mn loan from GE Capital: Report!Tata group-owned Jaguar Land Rover (JLR) has secured a GBP 170 million (about USD 284 million) loan from GE Capital in a move to strengthen its financial position, a media report says.Source: Zee News : Business | 16 Nov 2009 | 5:17 am Stronger yuan needed for rebalancing: IMF chief!A stronger Chinese yuan is part of the reforms that Beijing needs to implement to increase domestic consumption and help ease global imbalances, the head of the International Monetary Fund said on Monday.Source: Zee News : Business | 16 Nov 2009 | 5:17 am Japan`s economy posts strongest growth since 2007!Japan`s economy grew at the fastest pace in two and a half years in the third quarter of 2009, smashing market forecasts and extending a recovery from the worst downturn in decades, data showed on Monday.Source: Zee News : Business | 16 Nov 2009 | 5:17 am GM to start repaying US govt loan: Report!General Motors Co will announce on Monday it plans to start repaying a USD 6.7 billion loan to the US Treasury by year-end due to modest operating improvements, a source knowledgeable about the situation said.Source: Zee News : Business | 16 Nov 2009 | 5:17 am Glenmark Generics settles litigation with Medicis PharmaGlenmark Generics Inc, the US unit of Glenmark Generics Ltd, said on Monday it has settled all pending litigation with Medicis Pharmaceutical Corporation relating to patent actions regarding Fluocinonide.Source: Moneycontrol Top Headlines | 16 Nov 2009 | 5:05 am Aban Offshore raises $150m: SourcesDrilling contractor Aban Offshore has raised USD 150 million by selling new shares to institutions at Rs 1,224.30 (USD 26.6) each, two sources with direct knowledge of the deal said.Source: Moneycontrol Top Headlines | 16 Nov 2009 | 4:58 am Suzlon gets 21 MW wind turbine orderWind turbine maker Suzlon Energy said on Monday its north American unit had a got an order to supply wind turbines with a capacity to produce 21 megawatts of electricty.Source: Moneycontrol Top Headlines | 16 Nov 2009 | 3:58 am In bingetolerant Japan, alcoholism not seen as diseaseWhen Japanese civil servant Yoshiyuki Takeuchi saw himself lagging behind his peers at work, alcohol was the only thing he felt he could turn to, becoming the latest victim of an addiction poorly understood in Japan.Source: Moneycontrol Top Headlines | 16 Nov 2009 | 3:58 am Reliance eyes shale gas, studying technologyEnergy major Reliance Industries is studying technologies used in producing shale gas and may think of making an investment, the Economic Times reported, citing an unnamed senior company official.Source: Moneycontrol Top Headlines | 16 Nov 2009 | 3:58 am PVR gains 2% on DT Cinemas buy - Business Standard
Source: Business - Google News | 16 Nov 2009 | 3:31 am IOC seeks 23 mscmd of gas from RIL\'s D6 blockIndian Oil Corporation has sought around 23 mscmd of gas from Reliance Industries (RIL) operated KrishnaGodavari Basin D6 block.Source: Moneycontrol Top Headlines | 16 Nov 2009 | 3:25 am Telecom operators want lockin policy relaxedTelecom operators have urged the regulator to relax merger and acquisition laws to encourage consolidation in the sector.Source: Moneycontrol Top Headlines | 16 Nov 2009 | 3:19 am Telecom stocks ring loud - India Infoline.com
Source: Business - Google News | 16 Nov 2009 | 3:16 am Sensex closes at 17000; realty, auto, metals up - Economic Times
Source: Business - Google News | 16 Nov 2009 | 3:14 am BSE Sensex provisionally rises nearly 1 pctMUMBAI (Reuters) - The BSE Sensex provisionally closed nearly 1 percent higher on Monday, led by gains in Reliance Industries and State Bank of India, mirroring the rise in world stocks.Source: Reuters: Money News | 16 Nov 2009 | 3:07 am France-based Tyre group to set up rs 4000 cr facility in TN - Economic Times
Source: Business - Google News | 16 Nov 2009 | 3:06 am Sensex ruling firm, up 202 pointsBuoyed by the positive weekend numbers on industrial output and cues from the government on its divestment plans, Indian equities continued to trade firm Monday afternoon, with a key index ruling 201.89 points above its previous close.Source: IndiaeNews.com: Business News | 16 Nov 2009 | 3:03 am Two years after, Smart City foundation stone gathers mossTwo years after the foundation stone for the Smart City IT park was laid here, the ambitious project is yet to see any progress, thanks to the unresolved issues between the government and the developer.Source: IndiaeNews.com: Business News | 16 Nov 2009 | 3:02 am Madhya Pradesh villagers being cautioned on climate changeWith the the global Copenhagen climate change summit just three weeks away, grassroots efforts are on to raise awareness among Madhya Pradesh tribals about the impact of climate change on rural livelihoods.Source: IndiaeNews.com: Business News | 16 Nov 2009 | 3:01 am Protesters disrupt train services in OrissaThousands of protesters disrupted rail traffic Monday at Bhusandpur in Orissa's Khurda district demanding stoppage of express trains at the town's railway station, an official said.Source: IndiaeNews.com: Business News | 16 Nov 2009 | 3:00 am Emirates to operate 12 flights from KolkataDubai-based Emirates Airline is all set to increase its weekly flights to 12 from the city from Dec 3, a company official said here Monday.Source: IndiaeNews.com: Business News | 16 Nov 2009 | 3:00 am Volvo to sell stake in Chinese joint ventureSTOCKHOLM (Reuters) - Volvo, the world's second-biggest truck maker, said on Monday it was pulling out of a stalled venture with the China National Heavy Duty Truck group, selling its stake in Jinan Huawo Truck Corporation and clearing the way for a Volvo tie-up with another Chinese group.Source: Reuters: Money News | 16 Nov 2009 | 2:59 am Taiwan signs financial MOU with China - sourceTAIPEI (Reuters) - Taiwan has signed a financial service pact with China, allowing its banks to tap China's massive market and paving the way for banks on both sides to invest in each other, a source said on Monday.Source: Reuters: Money News | 16 Nov 2009 | 2:51 am Cabinet to consider stake sales soon - govtNEW DELHI (Reuters) - The cabinet will soon consider selling part of the government's stake in Steel Authority of India Ltd and NMDC Ltd, Steel Minister Virbhadra Singh told reporters on Monday.Source: Reuters: Money News | 16 Nov 2009 | 2:30 am GM plans to start govt loan repayment later this yearNew York: General Motors is planning to start the repayment of a $6.7 billion loan it received from the US government later this year, says a media report. Attributing to a person familiar with the matter, The Wall Street Journal said, GM plans to begin paying back a $6.7 billion loan it owes to the US government starting late this year, which would put it on track to potentially repay the entire loan by the middle of 2011. The report said the move could be controversial and risky as the car maker plans to use other money it received from the government to pay back the borrowing. The daily said that GM’s move, in which it would repay $1 billion per quarter to the Treasury, is likely to be outlined today, when the company reports its earnings for the first time since emerging from bankruptcy. In addition, the company would also start repaying a $1.4 billion loan to Canada at $200 million per quarter. According to the publication, GM outperformed financial objectives during its 40-day stay in bankruptcy and in the months since it emerged from Chapter 11 protection in July. Under the terms of the $50 billion-bailout it received from the Treasury starting last December, GM agreed to repay the government in two forms: a $6.7 billion loan and a 60% equity stake. The Treasury plans to start selling off the equity stake after GM launches an initial public offering, the report added. The WSJ report said, under the government agreement GM can use taxpayer money to repay the loan. GM still has $13.4 billion in an escrow account that came from its bailout, or twice the amount it needs to pay back the government back. Another factor that allowed GM to set up the repayment schedule is the relative health of its parts-supplier base, the report said citing sources. Because fewer supplier disruptions have occurred in a weak economy than were expected, GM didn’t have to bail out as many of its parts makers as it had planned for. GM had been planning to go public in late 2010, but the company’s chairman, Edward E Whitacre Jr said last week it is too early to predict the timetable for GM’s return to the stock market. Source: Home - Livemint.com | 16 Nov 2009 | 2:28 am Oil advances 1.4% to above $77 on dollar weaknessLondon: Oil prices rose a dollar to above $77 a barrel on Monday, regaining most of last week’s 1.4% losses as the dollar drifted lower US crude futures for December delivery rose $1.18 to $77.53 a barrel by 2:39pm, London Brent crude gained $1.09 to $77.40. The US dollar fell slightly by 0.45% on Monday against a basket of currencies, as it heads into a week likely to see increased debate over currencies during US President Barack Obama’s visit to China. “As a result, we do not see traders taking aggressive positions in either direction on the dollar this week, possibly waiting to see what happens at the culmination of the president’s visit,” MF Global commodity analyst Edward Meir said. A weaker dollar typically supports commodities because the dollar-priced contracts become cheaper for buyers using other currencies. Underlining views that global economic imbalances are reflected by the weakening dollar, the head of the International Monetary Fund said a stronger Chinese yuan was part of the reforms Beijing needed to implement to increase domestic consumption. The weaker dollar helped push gold prices to a fresh record high on Monday, while US wheat, corn and soybean futures also advanced more than 1%. There was little impact from comments by Opec’s president, Jose Botelho de Vasconcelos, who said the market was still oversupplied, adding that he was satisfied with current oil prices and compliance, which he put at about 65%. Hopes of a revival in energy demand from Japan supported prices. Japan’s economy grew at the fastest pace in more than two years in the third quarter, as stimulus measures lifted consumer spending and capital spending bottomed out. But with growth in the world’s No. 2 economy largely fuelled by the continued effects of stimulus spending by governments around the world, some analysts warned the recovery may lose momentum in coming quarters due to weak domestic demand. With most corporate results already reported, market watchers will seek the next catalyst to set direction for the dollar, stocks and commodities. That puts this week’s round of economic data in the spotlight, including US retail sales, inflation and housing starts data. Analysts said upside gains to oil prices could be limited, however, with US data pointing to a choppy recovery, while bulging fuel inventories also reflected sluggish energy demand. Source: Home - Livemint.com | 16 Nov 2009 | 2:21 am Competition in agriculture to benefit people: Pranab - Economic Times
Source: Business - Google News | 16 Nov 2009 | 2:15 am India gold traders stay away on new recordsMumbai: India’s gold traders stayed away from the market as the yellow metal powered to its fresh highs, with the flow of scrap easing on expectations of a further rise, dealers and traders said. “Nothing... I haven’t done a single order since morning,” said a dealer with a state-run bullion dealing bank in Mumbai, when asked about the physical off take. Dealers said traders sought lower prices to replenish stocks to meet wedding demand, which will last till December. “I have some orders at $1,120-1,125 an ounce and further buying could happen at $1,080 level,” said another dealer with a private bank. The most-traded December contract continued its record-breaking spree on Monday as a weaker dollar spurred buying in the alternative asset. The contract struck a fresh high of Rs16,919 per 10 grams, before trading at Rs16,894, up 0.56% at 2:35pm. The flow of scrap also eased as sellers sought higher prices, traders said. “I have around 10 people lined outside my shop, most of them are still waiting for higher prices. They want prices above Rs17,200 now,” said Jitendra Kantilal, partner, Jugraj Kantilal & Co, a Zaveri Bazaar-based scrap dealer, that offered to buy scrap at Rs17,100 per 10 grams. Kantilal estimates about 200-250 kg of scrap entered Mumbai’s Zaveri Bazaar last week. Source: Home - Livemint.com | 16 Nov 2009 | 2:13 am India gold traders stay away on new recordsMUMBAI (Reuters) - India's gold traders stayed away from the market as the yellow metal powered to its fresh highs, with the flow of scrap easing on expectations of a further rise, dealers and traders said.Source: Reuters: Money News | 16 Nov 2009 | 2:11 am Gold touches Rs 16,900-mark in early tradeStandard gold prices today reached an all time high at Rs 16,900 in the early trade on the bullion market here on persistent stockists buying on the back of rise in overseas market.Source: India Business News | Business News - Times of India | 16 Nov 2009 | 2:05 am India gold futures at fresh record highIndia gold futures struck a fresh record high of Rs16,885 per 10 gm, bolstered by overseas leads and a weaker dollar.Source: Daily News & Analysis: Money News | 16 Nov 2009 | 1:53 am Satyam scam: SFIO to begin prosecution this month - Times of India
Source: Business - Google News | 16 Nov 2009 | 1:50 am Satyam scam: SFIO to begin prosecution this monthThe government on Monday said the Serious Fraud Investigation Office (SFIO) will begin prosecution into the Satyam scam this month.Source: India Business News | Business News - Times of India | 16 Nov 2009 | 1:43 am Canon to buy Dutch Oce in $2.2 bln dealTOKYO/AMSTERDAM (Reuters) - Japan's Canon said it would buy Dutch copier and printer maker Oce in a deal worth $2.2 billion, as it tries to return to growth after the global downturn crippled demand for office equipment.Source: Reuters: Money News | 16 Nov 2009 | 1:39 am Cox and Kings fixes IPO price band at Rs 316-330 - Economic Times
Source: Business - Google News | 16 Nov 2009 | 1:30 am Power ministry to approach finance ministry for abolition of service taxNew Delhi: Power secretary H S Brahma on Monday said the ministry would soon approach the finance ministry for abolition of service tax on power transmission that could benefit end consumers by way of lower tariff. “We took it up (the issue of abolition of service tax) with the finance ministry once but the response was not great. We are going to take it up soon,” Brahma told reporters on the sidelines of a CII event here. In a meeting with the state power secretaries on Sunday, five states, including Andhra Pradesh, had asked power minister Sushil Kumar Shinde to approach the finance ministry for abolishing the service tax on power transmission. At present, a service tax of 12.36% is charged from power transmission companies. The states, however, have been demanding total abolition of the tax. Source: LatestNews-Home - Livemint.com | 16 Nov 2009 | 1:29 am CMIE revises GDP growth forecast to 6.2%Mumbai: The Centre for Monitoring Indian Economy (CMIE) has revised its GDP growth forecast for the current fiscal to 6.2% from 6% announced last month. The upward revision in the GDP projection comes on the back of a better performance of the country’s economy in HI of the current fiscal (FY 10), the economic think-tank said in its latest report. “The Indian economy’s performance during the first-half of 2009-10 has turned out much better than our expectations. This warrants an upward revision in our real GDP growth for the second consecutive month. The revision this time is from 6% to 6.2%,” it said. CMIE, last month, raised the GDP growth forecast to 6% from 5.8% announced in September. The industrial sector (including construction) is expected to grow by 7.4% while services by 8.5% in FY10, the report said. Last fiscal, the growth in the two sectors was 3.9% and 9.7%, respectively. The economy has emerged much stronger from the global liquidity crisis, the CMIE report said, adding the liquidity condition has improved dramatically in the current fiscal. “RBI has begun withdrawal of refinance and special liquidity measures it had announced (earlier) to overcome the liquidity problem,” the report said. According to CMIE, some sectors such as cement, steel, automobile, coal, gas and railway freight movement have seen a rapid growth in recent months. However, a poor southwest monsoon had some impact on growth, it said. “The only discordant note in this growth story was struck by the poor southwest monsoon this year. Had there been no drought, the economic growth in 2009-10 would have moved much closer to the pre-crisis level,” CMIE said. Source: LatestNews-Home - Livemint.com | 16 Nov 2009 | 1:24 am Obama says Washington not trying to contain ChinaSHANGHAI (Reuters) - U.S. President Barack Obama said he was not seeking to contain China's rise and called for more balanced trade between the two powers, which have sparred over currency and economic policy ahead of a summit.Source: Reuters: Money News | 16 Nov 2009 | 1:14 am Sensex trades above 17,000Indian equities continued to trade in the green on Monday afternoon, with a key index ruling 191.24 points above its previous close.Source: India Business News | Business News - Times of India | 16 Nov 2009 | 1:08 am Kerala tourism smiles after National Geographic ratingKerala tourism needed some good news after being hit by global recession and the Thekkady boat tragedy in September. It has got the pep with the National Geographic rating its backwaters as the world's 23rd best destination, giving the sector a reason to smile.Source: IndiaeNews.com: Business News | 16 Nov 2009 | 1:06 am Is it liqueur? Is it coffee? It's liqueur coffee!Can't make up your mind whether to have a cup of coffee or a shot of liqueur after dinner? Well, you can have both at one go - in the form of liqueur coffee, that is fast gaining in popularity.Source: IndiaeNews.com: Business News | 16 Nov 2009 | 1:05 am Insurance firm asked to pay for stolen truck, with interestUnited India Insurance has been asked by the consumer forum here to pay Rs.400,000 plus interest to a customer who got a truck insured with the company but was not paid when the vehicle was stolen.Source: IndiaeNews.com: Business News | 16 Nov 2009 | 1:03 am Oil higher as dollar stays weakThe dollar remained weak against the euro in Asia trade today, trading at 1.4949 to the European unit compared with 1.4911 in late US trading Friday.Source: Daily News & Analysis: Money News | 16 Nov 2009 | 1:03 am Michelin to invest Rs.4,000 cr near ChennaiFrench tyre major Michelin has signed an agreement with the Tamil Nadu government to set up a manufacturing facility on an investment of Rs.4,000 crore spread over seven years.Source: IndiaeNews.com: Business News | 16 Nov 2009 | 1:01 am Sensex 191 points up early afternoonBuoyed by the positive weekend numbers on industrial output and cues from the government on its divestment plans, Indian equities continued to trade in the green Monday afternoon, with a key index ruling 191.24 points above its previous close.Source: IndiaeNews.com: Business News | 16 Nov 2009 | 1:00 am Glenmark settles patent dispute with Medicis - Press Trust of India
Source: Business - Google News | 16 Nov 2009 | 12:56 am Rupee near 1-month highs on stocks; weak dollarMumbai: The Indian rupee rose to its highest in nearly a month on Monday on the back of gains in local shares and a weak dollar overseas but dollar demand from importers limited a further rise. At 1:05pm, the partially convertible rupee was at Rs46.05/06 per dollar, off a high of 46, its strongest since 20 October and stronger than its previous close of Rs46.31/32. On Friday, the rupee fell to as low as Rs46.75 during trade, its weakest since 6 November. The dollar drifted lower on Monday and the euro edged up as rhetoric over China’s yuan currency policy increased, although market speculation of any near-term yuan appreciation receded. Shares rose more than 1%, to their highest in more than three weeks, led by gains in banks and supported by strength in Asian markets. Foreigners have bought a net $14.9 billion of shares so far in 2009, after selling more than $13 billion last year. The inflows have helped the rupee recover from its record low of 52.2 in early March. In the currency futures market, the most traded near-month contracts on the National Stock Exchange and MCX-SX were both quoting at 46.1025 each, with the total traded volume on the two exchanges at about $1.4 billion. Source: Home - Livemint.com | 16 Nov 2009 | 12:55 am Noon: Sensex regains17k level; banks, Sterlite upMumbai: The BSE Sensex rose more than 1% on Monday morning to its highest in more than three weeks, led by gains in banks and supported by strength in Asian markets. Leading banks State Bank of India and ICICI Bank rose, helped by a view that economic conditions were improving and the long-term outlook for the sector was positive. ”At present, we believe that the operating environment for banks is positive, with sufficient liquidity and low interest rates,” First Global Securities said in a note of Friday. ”Going forward, there will be a pick-up in credit growth, as companies, particularly in the Infrastructure segment, are coming back to banks for their working capital requirements and project finance,” it said. State Bank rose 2.8% to Rs2,362 while ICICI climbed 1.6% to Rs923.75. At 1:21pm, the 30-share BSE Index was trading up 1% at 17046.16, with 26 components gaining. The 50-share NSE index was up 0.9% at 5062.40. The benchmark rose above 17,000 for the first time since 23 October, and has gained more than 7% this month. ”The market has risen in line with global markets. But, we are still cautious as it seems to be purely a liquidity-driven rally,” said Ambareesh Baliga, vice-president of Karvy Stock Broking. The benchmark index is up more than three-quarters in 2009, boosted by net foreign fund buying of nearly $15 billion of stocks. Metals producer Sterlite Industries was up 2.9% at Rs861.90 after a US federal judge issued a ruling supporting a bid by rival Grupo Mexico for Asarco LLC. JPMorgan said in a note that while Sterlite could appeal against the decision, it expected it would not appeal given the extended court process and the likely overhang on the stock. ”This, in our view, is a positive given the company would now focus on other key events in the near term,” JPMorgan said. Top vehicle maker Tata Motors rose 3% to Rs638, after the Financial Times said Jaguar Land Rover was expected to announce it has secured a 170 million pound working capital facility from GE Capital. Export-driven software firms were weaker as the rupee rose to its strongest against the dollar in nearly a month. ”We are cautious on the IT sector on an appreciating rupee and rising cost pressure,” said Baliga. Top software services company Tata Consultancy was down 1%, Infosys Technologies had lost 0.6% and Wipro was down 0.9%. In the broader market, gainers led losers in a ratio of 2.4:1 in volume of 101 million shares. Source: Home - Livemint.com | 16 Nov 2009 | 12:33 am Glenmark settles patent dispute with MedicisNew Delhi: Pharma firm Glenmark on Monday said it has settled all pending patent disputes with US-based Medicis Pharmaceutical Corp over a skin disease drug, besides signing a licensing agreement for new drug delivery system (NDDS). The company through its US-based subsidiary Glenmark Generics Inc has announced the settlement of all litigation pending between Medicis and Glenmark related to the generic version of Vanos and Loprox gel, used in the treatment in dermatology therapeutic area, Glenmark Pharmaceutical spokesperson said. Under the terms of the agreement Glenmark will be able to market and distribute the generic version of Vanos cream under license from Medicis from December 2013. In addition, Glenmark will be able to launch the generic version of Loprox gel in 0.77% strength immediately, he added. Vanos Cream has a total market of $35 million and Loprox Gel has an annual market of $15 million in US. The company has also entered into a license agreement with Medicis Pharmaceutical Corporation to co-develop and commercialise its pateneted NDDS, Glenmark Pharmaceuticals said in a statement. The new patented NDSS is for the dermatology therapeutic segment and pursuant to the outlicensing agreement, Glenmark will receive an upfront payment of $5 million and also eligible to receive additional payments upon achieving certain development milestones and royalty upon commercialisation, it added. “Both Glenmark and Medicis have extensive experience in the dermatological market segment and this collaboration will allow us to bring a promising new treatment alternative to patients,“ Glenmark Pharmaceuticals Ltd managing director and CEO Glenn Saldanha said. Medicis Pharmaceutical Corporation is an independent specialty pharmaceutical company in the US focusing primarily on the treatment of dermatological and aesthetic conditions. Shares of Glenmark Pharmaceuticals were trading at Rs233.25 on the BSE, up 4.97% from its previous close. Source: LatestNews-Home - Livemint.com | 16 Nov 2009 | 12:29 am Taj hotel heritage wing to open doors soonMumbai, Nov. 15 The burning dome of The Taj Mahal Palace was among the most distressing, yet iconic, images of the armed attack on Mumbai, last November.Source: Business Line - Home Page | 16 Nov 2009 | 12:00 am FIIs reduce holding in one-third of BSE 500 stocksBL Research Bureau Foreign institutional investors (FIIs) may have continued to pour money into the Indian markets in recent months, but they weren’t uniformly bullish on all stocks orSource: Business Line - Home Page | 16 Nov 2009 | 12:00 am UltraTech agrees to 4:7 swap for Samruddhi mergerMumbai, Nov. 15 The board of directors of UltraTech Cement has agreed to an exchange ratio of four shares of UltraTech (of Rs 10 each) to every seven shares of Samruddhi (of face value of Rs 5Source: Business Line - Home Page | 16 Nov 2009 | 12:00 am Oman Oil picking up more stake in BPCL’s Bina refineryMumbai, Nov. 15 Oman Oil Company is back as an equity partner with Bharat Petroleum Corporation in the six million-tonne Bina refinery scheduled to be commissioned in the second quarter ofSource: Business Line - Home Page | 16 Nov 2009 | 12:00 am Writing of options involves margin requirementsI have 100 shares of MphasiS and 500 shares of PTC India. Can you please tell me their prospects for the near-term according to F&O indicators? – Mr Ganeshan, Erode, TamilSource: Business Line - Home Page | 16 Nov 2009 | 12:00 am Engg, management grads see clerical job as a ‘stopover’Hyderabad, Nov. 15 Entrance exams for clerical vacancies in State Bank of India are under way. But the bank may perhaps have to start preparing a contingency plan for ‘attrition’ even before the recruitment tests areSource: Business Line - Home Page | 16 Nov 2009 | 12:00 am Telecom operators want lock-in policy relaxedNew Delhi, Nov. 15 Telecom operators have urged the regulator to relax merger and acquisition laws to encourage consolidation in the sector.Source: Business Line - Home Page | 16 Nov 2009 | 12:00 am Day Trading GuideThe analysis and opinion expressed in these columns are based on the technical analysis of the past price behaviour. The stop-loss level provided with the recommendation is important. The original view would stand negated if the stop-loss levelSource: Business Line - Home Page | 16 Nov 2009 | 12:00 am Opto Circuits India (Rs 219.9): BuyWe recommend a buy in Opto Circuits India from a short-term horizon. It is perceptible from the charts of the stock that it has been trending upwards since the December 2008-low of Rs 69.50. The stock’s trend is up in all the time-framesSource: Business Line - Home Page | 16 Nov 2009 | 12:00 am Gold futures may test resistance levelsComex gold futures ended higher once again Friday as the dollar weakened on worries over economic recovery boosting gold’s appeal as a hedge against the dollar. The US Dollar Index, the six-currency basket touched a 15-month low on NovemberSource: Business Line - Home Page | 16 Nov 2009 | 12:00 am Gold hits record above $1,130 on weak dollarTokyo: Spot gold hit a record high above $1,130 an ounce on Monday with investors cautiously preparing for the precious metal to advance towards the psychologically important $1,200 level as the US dollar is expected to remain weak for now. Investors maintained their appetite for bullion as a hedge against currencies as the greenback drifted lower in Asia and the euro edged up as rhetoric over China’s yuan currency policy increased. The United States and China sparred over exchange rates at a meeting of Asia Pacific leaders on Sunday, a move that quashed expectations that China may allow the yuan scope to rise in coordination with US President Barack Obama’s first trip to Beijing. Spot gold was at $1,128.20 an ounce at 11:54am, up 0.9% from New York’s notional close of $1,118.50. It earlier rose as high as $1,130.25, an all-time high. Gold has pierced record highs for 7 days out of the past 10 sessions, during which it has risen more than 6%. The previous record was $1,122.85 marked on Thursday. US gold futures for December delivery stood at $1,129.20 an ounce, up 1.1% from Friday’s settlement. The contract had reached a new record high of $1,130.60. The current uptrend looks sustainable because the market has not felt the “real euphoria” of a daily price jump of more than 3 percent, said Koichiro Kamei, managing director at financial research firm Market Strategy Institute in Tokyo “The yellow light has been on but no red light has been seen on the current course to the $1,200 target since gold broke through above $1,000 in September,” he said. Volatility in gold prices is expected to stay relatively high in coming days as substantial amounts of open positions remain in US December gold futures call options with a strike price of $1,200, whose expiry is due next week. Buying call options has been one strategy for gaining exposure to gold. A rise above $1,150 in US gold futures could bolster further options-related buying, analysts said. Yuichi Ikemizu, Tokyo branch manager for Standard Bank, said buy orders placed soon after Asia’s opening for December gold futures at $1,127.90 per ounce were in substantial lots. “The existence of bullish players who bought in such an aggressive manner itself showed how strong the market’s momentum is,” he said. News on Monday that commodities funds manager Blackrock Investment expected central banks to be net gold buyers in 2009 also helped gold’s rise, now that the precious metal is more sensitive to bullish news than bearish news, traders said. Focus is also on how strong scrap gold selling was in the last quarter in an industry report by the World Gold Council due later this week as gold now has fewer sellers, Market Strategy Institute’s Kamei said. “If the Gold Demand Trends report shows a drop in scrap selling in July-September from the previous quarter, that would be a surprise and further push up the market,” Kamei said. In the currency market, the dollar index fell 0.4% to 75.042. It had fallen on Friday after data showed a wider US trade deficit and weaker consumer sentiment. The dollar was slightly softer against the yen after data showed the Japanese economy grew 1.2% in the third quarter, nearly double forecasts, but that was partly due to stimulus that the previous government enacted. Underlining views that a global economic imbalance is being reflected in the weakening dollar, the head of the International Monetary Fund said a stronger Chinese yuan is part of the reforms that Beijing needs to implement to increase domestic consumption. Spot platinum tracked gold’s gains and rose 0.8% to $1,401.50 an ounce from New York’s notional close of $1,390. It earlier hit a 14-month high of $1,403.50. Spot silver was up 1.3% at $17.62 per ounce. Underling the metal’s firmness, holdings by the world’s largest silver-backed exchange-traded fund hit record levels for the second straight day on Friday. But interest from long-term investors in gold-backed securities was relatively low. The world’s largest gold-backed exchange-traded fund, the SPDR Gold Trust, said its holdings fell 0.61 tonnes to 1,113.833 tonnes on Friday. Source: Home - Livemint.com | 15 Nov 2009 | 11:51 pm Suzlon US arm bags order to supply 10 wind turbinesMumbai: Wind turbine maker Suzlon Energy on Monday said its US-based arm Suzlon Wind Energy Corporation, has received order for supply of 10 wind turbines. A step-down wholly owned subsidiary of the company has bagged an order to supply 10 Suzlon S88 2.1 MW wind turbines that would generate 21 megawatt of energy for the Grant County Wind Farm, in Minnesota, USA, Suzlon said in a filing to the Bombay Stock Exchange (BSE). However, the company has not disclosed the financial details of the project. Construction on the site has already begun and the wind farm is expected to be in commercial operation in the first quarter of 2010, the filing added. Shares of Suzlon were trading at Rs69.65 on the BSE, up 4.42% from its previous close. Source: LatestNews-Home - Livemint.com | 15 Nov 2009 | 11:47 pm Rupee gains to near 1-month high on stocks - Economic Times
Source: Business - Google News | 15 Nov 2009 | 11:45 pm Sensex surges 194 points in early trade on Asian cuesThe Sensex gathered more than 194 points to trade over 17,000 points level, extending previous session's gains on continued buying by funds.Source: Daily News & Analysis: Money News | 15 Nov 2009 | 11:03 pm Washington not trying to contain China: ObamaShanghai: US President Barack Obama said on Monday that Washington was not trying to contain China’s rise but said trade between the two giants needed to be more balanced. Addressing students at a town hall-style meeting in Shanghai on the first full day of his first trip to China, Obama said the notion that Washington and Beijing must be adversaries was not pre-destined. Obama faces tensions with China over trade and Tibet on his visit to the emerging superpower for a summit that will grapple with economic imbalances and the future of the yuan currency. He arrived in Shanghai, China’s commercial hub, late on Sunday. “We do not seek to contain China’s rise,” Obama said before taking questions from the audience as well as from Chinese over the Internet. “On the contrary we welcome China as a strong and prosperous and successful member of the community of nations -- a China that draws on the right strengths and creativity of individual Chinese.” “We do not seek to impose any system of government on any other nation but we also don’t believe the principals we stand for are unique to our nation.” Chinese state-run Internet sites have asked the public for questions to quiz Obama at the youth meeting, and many had urged him to explain if he plans to meet the Dalai Lama, the exiled Tibetan leader whom Beijing brands a separatist. These events will be a warm-up for Obama’s summit with President Hu Jintao in the capital on Tuesday that will cover trouble-spots such as North Korea and Iran, and efforts to forge a new climate pact. Obama has said he will also raise the sensitive subjects of human rights, and sometimes tense trade ties and China’s yuan currency, seen by US industry as significantly undervalued and stoking unsustainable global economic imbalances. Obama noted that in 1979, when Washington established ties with the People’s Republic of China, trade was worth several billion dollars, compared to more than $400 billion now. “This trade could create even more jobs on both sides of the pacific ... as demands becomes more balanced it can lead to even more prosperity,” Obama said. At a gathering of Asia-Pacific leaders in Singapore over the weekend, Hu pointedly ignored international calls for his government to raise the value of the yuan and make Chinese exports relatively more expensive. He and other senior Chinese officials have instead accused other countries -- implicitly including the United States -- of embracing damaging trade protectionism aimed at Chinese goods. A senior Chinese official on Monday made a fresh, thinly veiled criticism of Washington for running lax monetary and fiscal policies that risk undermining the dollar. But having already made their gripes clear before the summit, Obama and Hu may avoid sharp public jabs as they focus on building goodwill between the the world’s biggest and third biggest economies. Obama said both Washington and Beijing must take “critical steps” to tackle global climate change. Other countries are waiting to see what the United States and China will do ahead of a UN meeting in Copenhagen, Obama said. China is considered the world’s biggest annual emitter of carbon dioxide, the main greenhouse gas from human activity. Beijing has said developing countries should not accept internationally binding ceilings on emissions while they focus on economic growth and escaping poverty. China has had a huge trade surplus with the United States, and is also the largest foreign holder of US government bonds. The US trade deficit with China widened 9.2% in September to $22.1 billion, the highest since November 2008, according to US data released last week. Source: Home - Livemint.com | 15 Nov 2009 | 10:53 pm Financial sector reforms: the buck does not stop with RBIAre winds of change blowing through the hallowed portals of India’s central bank, which turned 75 this year? Last month it took quite a few baby steps towards financial sector liberalization. It expanded the scope of currency futures by allowing stock exchanges to offer future contracts in pairs of euro-rupee, Japanese yen-rupee and pound sterling-rupee in addition to dollar-rupee; introduced plain vanilla credit default swaps, or CDS, for corporate bonds; and permitted banks to set up as many branches as they wish to in smaller cities and towns without its approval.  Winds of change: The Reserve Bank of India is slow in opening up the financial sector, but the government, too, needs to walk the talk. Mint Ahead of these measures, in August, the Reserve Bank of India (RBI) introduced interest rate futures and, in September, put up the draft guidelines on repurchase, or repo of, corporate bonds with a commitment to issue the final guidelines by end-November. And now, within a week of Prime Minister Manmohan Singh announcing at the India Economic Summit of the World Economic Forum that his government will carry out large-scale financial sector reforms to push economic growth, RBI has proposed that banks should be allowed to offer plain vanilla cross-currency options to resident Indians. When it finalizes the draft guidelines, importers and exporters will also be allowed to write and sell put options both in foreign currency-rupee and cross-currencies and earn a premium on them.  The credit for shaking the central bank out of a self-congratulatory mode for protecting the Indian financial system from the brunt of the sub-prime crisis and the global meltdown in the wake of the collapse of US investment bank Lehman Brothers Holdings Inc. goes to finance minister Pranab Mukherjee. In July, in his post-budget meeting with the central board of RBI, Mukherjee focused on the need for financial sector reforms. He spoke about better coordination among regulators, bringing all financial market regulations under the capital market watchdog, and setting up a separate public debt office, relieving RBI of its role as the investment banker for the government. He also called for new regulation for supervision of non-banking finance companies and inclusion of financial stability in the Act that governs the Indian central bank. In the past few years, at least three expert panels have looked at what needs to be changed in the Indian financial sector and who should do it. Let me attempt a status report. Also Read Tamal Bandyopadhyay’s earlier columns Regulatory pre-emptions: Indian banks’ investment in government bonds and cash reserve ratio (CRR), or the portion of deposits kept with RBI, is very high compared with other economies. They should come down. They continue to be very high, 30% of banks’ deposits, even though the regulatory minimum limits on such preemptions have been removed. Directed lending: Currently, 40% of bank loans (35% for foreign banks) are to be given to agriculture and small business units and a substantial portion of them at concessional rates, but it has not helped financial inclusion. Ideally, banks should move from a mandated directed lending target to a market-based approach. Suggestions include allowing banks to set their own targets, making mandated loan obligations tradable and offering direct subsidies instead of forcing banks to give loans at low rates. An internal RBI panel has suggested replacement of mandated loan rates by direct subsidy. The central bank is also in the process of setting up a working group to examine the issues involved in the introduction of priority sector loan certificates and trading them on exchanges. Consolidation: Expert panels have been in favour of consolidation in the Indian banking system and leveraging the scale. One panel even suggests selling small underperforming public sector banks to other banks or strategic investors and allowing acquisitions by domestically incorporated subsidiaries of foreign banks. Nothing has happened so far even as the “too big to fail concept” is being challenged globally. Also, no foreign bank has opted for the local subsidiary route as yet. Abolition of branch licensing: Banks should be free to set up branches and ATMs anywhere, except for foreign banks in urban India. Also, sale, closure and exchange of bank branches should be allowed. Substantial progress has been made on this front. Banks are free to set up ATMs and the domestic players are free to open branches in smaller towns with a population of 50,000 or less, provided at least one-third of such branches are in under-banked pockets. Opening of branches in tier 1 and tier 2 centres continues to require RBI permission. Ownership and management of public sector banks: Direct government ownership in these banks should be reduced from 51% and they should be board-managed companies. Large public sector banks should have stronger boards with possibly a private sector strategic investor; they should have the power to appoint and compensate top executives and take all business decisions without any intervention by the government. Nothing has happened so far. Public sector banks continue to run like a wing of the finance ministry. Rural banking: Small, well-governed, private deposit taking institutions should be allowed to focus on specific geographies on the lines of local area banks. Unviable cooperative banks should be closed and well-run cooperatives with a good track record should be allowed to convert themselves into small banks, with their members becoming shareholders. RBI is planning to revive the rural cooperative credit structure by mergers and capital infusion in regional rural banks and changing the regulatory and supervisory framework for urban cooperative banks. Banking correspondents: A wide range of local agents should be employed to extend financial services. While technology can cut costs to improve the viability of the model, they should be allowed to levy user charges to recover costs of services. RBI has allowed banks to appoint grocery stores, medical and fair price shop owners, individual public call operators, petrol pump owners, agents of small savings schemes, retired teachers and members of well-run self-help groups as banking correspondents. Banks can now impose reasonable service charges on customers. Insurance: The Insurance Laws (Amendment) Bill, 2008, which was introduced by the government in the Rajya Sabha in December 2008, provides for enhancement of share holdings by a foreign company, either by itself or through its subsidiary firms or its nominee in Indian insurance companies from 26% to 49%. The Bill is pending parliamentary approval. Tax rationalization to boost long-term savings: A separate tax exemption limit is recommended for long-term life insurance and pension/annuity products. A similar provision may be considered for investment in dedicated close-ended infrastructure mutual funds and long-term bank deposits. Tax arbitrage between debt mutual funds and bank deposits needs to be minimized/eliminated. The direct tax code proposes the removal of most exemptions to reduce tax arbitrage between various investment schemes. Pension reforms: Private sector entities should be permitted to manage pension funds of Central government employees. Besides, all categories of pension and provident funds should be permitted to diversify their investment portfolios. Private sector entities have been invited to manage pension funds of Central government employees. Changes have been proposed by the finance ministry in provident fund guidelines for more flexibility in investments, especially in corporate and PSU (public sector units) bonds, but they are yet to be approved by the ministry of labour. Debt market: The bond market in India remains limited in terms of nature of instruments, their maturity, investor participation and liquidity. Disclosure requirements have been simplified for listed companies and the cap on investment by foreign institutional investors, or FIIs, has been lifted from $6 billion to $15 billion. The final guidelines for repo in corporate bonds will be released later this month. Plain vanilla over-the-counter CDS for corporate bonds for resident Indians are being introduced. Derivative markets: Currency and interest rate derivative market is a key missing link in Indian markets. Besides, banks are not permitted to deal in equity derivatives and commodity derivatives. Exchange-traded interest rate futures were introduced in August and their scope has been increased by permitting currency futures contracts in three other currency pairs beside dollar-rupee. Regulations: The expert panels are divided on the critical issue of single regulator versus multiple regulators. The finance ministry seems to believe that all market regulations and supervision should be consolidated under the Securities and Exchange Board of India, or Sebi. The capital market regulator should oversee trading of currency futures, interest rate futures, government and corporate bonds. RBI has strong reservations on this proposal. There are quite a few other suggestions. For instance, financial houses should be allowed to set up holding companies for various intermediaries that come under different regulators. A financial holding company can raise and allocate resources in various subsidiary companies, depending on their needs, thereby using capital efficiently within the group as well as segregating risks across various financial businesses. Such holding companies should be supervised by a financial sector oversight agency while its subsidiaries will continued to be regulated and supervised by respective regulators. Indeed RBI is slow in opening up the financial sector and withdrawing from certain areas where Sebi should step in, but the government, too, needs to walk the talk. In three most critical areas of reforms—ownership of public sector banks, insurance firms and banking consolidation—the onus is on the government to change the rules of the game. The buck does not stop with RBI. Tamal Bandyopadhyay keeps a close eye on all things banking from his perch as a deputy managing editor of Mint in Mumbai. Please email comments to bankerstrust@livemint.com Source: Home - Livemint.com | 15 Nov 2009 | 10:48 pm UltraTech to buy Samruddhi to form No.1 cement firmSINGAPORE (Reuters) - UltraTech Cement, a unit of conglomerate Aditya Birla Group, is absorbing sister unit Samruddhi Cement, to form India's biggest cement firm, both companies said.Source: Reuters: Money News | 15 Nov 2009 | 10:30 pm GM to start repaying $6.7 bln U.S. govt loan - sourceWASHINGTON (Reuters) - General Motors Co. will announce on Monday it plans to start repaying a $6.7 billion loan to the U.S. Treasury by year-end due to modest operating improvements, a source knowledgeable about the situation said.Source: Reuters: Money News | 15 Nov 2009 | 10:22 pm Asian shares rise on record high goldHong Kong: Gold hit a record high on Monday as investors hedged against a weak dollar while Asian shares edged higher after upbeat reports from US retailers underpinned confidence the global economy is recovering. Gold punched a record above $1,126 an ounce, and sending platinum to its highest level since September 2008, as the dollar dipped 0.3% against a basket of currencies, and on bullish forecast from US investment fund BlackRock. Markets are focused on US President Barack Obama’s visit to China that began on Sunday as he is expected to discuss China’s yuan currency, which the US believes is undervalued, with Chinese leaders. Gold, which has gained 10% in the past 2-weeks, was further supported by forecast from investment fund BlackRock, a manager and advise to the US Federal Reserve, that gold would rise further and central banks would be net buyers of gold this year. “The most recent break-out in the gold price in U.S. dollars has caused most gold prices to start trending higher at the same time,” Evy Hambro, who runs two BlackRock commodities funds which are among the world’s largest commodities funds, said in Sydney. He added that investors were now looking for gold to rise in other commodities as well as US dollars. “When you start to see the price rising in a range of different currencies, it is a clear sign of a very strong market to come,” Hambro said. HITACHI SLUMPS 8 PCT Asian shares picked up after a slow start. The MSCI index of Asia Pacific stocks traded outside Japan and the Thomson Reuters index of regional shares were both up 1%. Japan’s Nikkei average however was flat as investors digested third-quarter growth data, which showed Asia’s biggest economy grew at its fastest pace in more than two years. But it is expected to slow as falling wages will hurt consumption. News of big share issues also dampened investor sentiment after sources said Japan’s biggest bank Mitsubishi UFJ Financial Group would issue about $11 billion in new shares. Shares of electronics giant Hitachi Ltd slumped 8% after sources said the company would raise up to $4.5 billion to shore up its battered capital base.. Mitsubishi shares were down 5%. “But it won’t end here - there are other companies out there in the same situation and we’re likely to see a whole rush of share issuance, raising some supply concerns,” said Nagayuki Yamagishi, a strategist at Mitsubishi UFJ Securities in Tokyo. Investors across the region appeared cautious after a recent rally in Asian shares, which has been driven by increasing evidence the global economy is on a recovery track. That view was reinforced with some upbeat US earnings reports on Friday from Walt Disney and retailer Abercrombie & Fitch and a bullish outlook from retailer JC Penney. They helped push the Dow Jones up 0.7%. The MSCI Asia-Pacific index, however, has already surged nearly 70% this year. Shares in Hong Kong and China outperformed the region, rising nearly 2% as they continue to attract strong fund inflows following bullish Chinese economic data in the past week. Asian currencies were firm and the Korean won hit a near 14-month high at 1,154.3 to the dollar at one point. Currencies in the region have been lifted by expectations China could soon resume appreciation of its yuan currency after an 18-month hiatus, with President Obama’s China visit this week expected to add pressure on China to allow appreciation. The head of the IMF, Dominique Strauss-Kahn, who is also in China, on Monday called for a stronger yuan to increase domestic consumption in China and help ease global imbalances. However, the Chinese Commerce Ministry on Monday said China should maintain a stable exchange rate while a Finance Ministry official made a thinly veiled criticism of the U.S. for undermining the dollar with its policies. The oil price also benefited from a weak dollar and was up nearly 1 percent, rebounding above $77 a barrel. Source: Home - Livemint.com | 15 Nov 2009 | 10:11 pm Rupee up 20 paise at 46.11 a dollarDollar's losses against other Asian currencies too helped the Indian rupee.Source: Daily News & Analysis: Money News | 15 Nov 2009 | 10:11 pm Consolidation of cement business strengthens ultratech Cement - India Infoline.com
Source: Business - Google News | 15 Nov 2009 | 10:06 pm Gap-up opening for equities; Sensex above 17,000All sectoral indices were trading with gains led by realty and metal counters. The broader market posted significant gains as well. Nifty was trading at 5051, higher by 1.04% or 52.05 points from the previous close. Sensex climbed 168.58 points or 1% to 17,017.41.Source: India Business News | Business News - Times of India | 15 Nov 2009 | 9:39 pm Rupee up 20 paise at 46.11 a dollarThe Indian rupee today strengthened by 20 paise to 46.11 against the US currency in early trade, extending gains for the second straight day on expectations of more capital inflows and dollar selling by exporters.Source: India Business News | Business News - Times of India | 15 Nov 2009 | 9:32 pm Labour crunch will be eased, says A'bad expertsGood news is that the textile industry is expected to undergo tremendous mordernisation in the coming year, putting an end to the wait for better technology.Source: Daily News & Analysis: Money News | 15 Nov 2009 | 8:29 pm A'bad: One-stop textile shopThe coming year will see Gujarat's textile industry undergo a major transformation; automation will be introduced at various levels to tackle labour crisis.Source: Daily News & Analysis: Money News | 15 Nov 2009 | 8:27 pm ONGC finds new oil pool at KalolIn just 4 days, new well is producing 500 barrels per day.Source: Daily News & Analysis: Money News | 15 Nov 2009 | 8:20 pm Strong order book, capex will help Era grow 50% a yearEra's construction business enjoys good margins riding on raw material being supplied by clients for most projects.Source: Daily News & Analysis: Money News | 15 Nov 2009 | 2:20 pm Planet alignments suggest bearishness early on this weekThe commitment of the bulls will be on test.Source: Daily News & Analysis: Money News | 15 Nov 2009 | 2:17 pm Nifty set to hit 5100 by expiryIndex to see sideways movement this week.Source: Daily News & Analysis: Money News | 15 Nov 2009 | 2:13 pm Looking beyond the border Two years back, had we suggested that you invest in international funds, you might have jumped at the opportunity. And why not? The year 2007 saw the launch of 12 international funds, eight of which were launched between August and October, when global markets, including India, were touching new highs. In 2007, the Securities and Exchange Board of India (Sebi) raised the overall ceiling for investments in foreign securities by mutual funds to $5 billion (around Rs23,000 crore now).  It did not take long before the fundamental reasons for launching international funds were tossed out of the window. In 2008, markets collapsed in the US on the back of the credit crisis, and Indian markets followed suit. If you had invested in international funds to protect your portfolio from the vagaries of just one market (India), your strategy would not have paid off—almost all the markets tumbled in 2008. So, does investing in international funds still make sense? Read on.  Graphics: Ahmed Raza Khan / Mint Also See What are they? International funds are funds that invest in international markets. Broadly, there are two types. One, that invests in both Indian and foreign markets, such as Fidelity International Opportunities Fund and ICICI Prudential Indo Asia Equity Fund. This lot typically invests at least 65% in Indian securities and the rest in international equities, as income-tax rules mandate investments of at least 65% in Indian securities to retain the equity tax advantage. Some funds invest in only one country apart from India, such as Fortis China India Fund and Mirae Asset China Advantage Fund. The second category is of purely international funds that invest their entire corpus internationally, such as Birla Sun Life International Equity Fund and HSBC Emerging Markets Fund. They can invest either in international schemes run by their foreign parents, which would further invest in international markets, or they can directly buy and sell international stocks. The potential pitfalls Currency risks: While the fund’s success rests on the quality of fund management, much like any domestic mutual fund scheme, the biggest risk for international funds is currency risk. The movement of the rupee versus the US dollar—the currency most international funds solicit investments in—affects the performance of your fund. For example, let’s suppose you invest Rs10,000 in an international fund in India. Assume that your fund invests in US dollars and the exchange rate at the time of investment is Rs50 to a dollar. You will get equities worth $200. Suppose that after a year, the rupee depreciates by Rs2 and stands at Rs52 to a dollar. If your fund redeems its money, assuming that foreign equities have not risen or fallen at all, your $200 would now be worth Rs10,400 (a 4% gain), purely on exchange rate play. Obviously, the exchange rate can also turn against you if the rupee appreciates.  Graphics: Ahmed Raza Khan / Mint The real currency risk comes when the rupee appreciates against the US dollar much more than other global currencies. If this happens, your international funds incur a loss. The trick for fund managers would be to anticipate not just the rupee-dollar equation, but also the equations of the US dollar with other currencies, especially the Asian ones, since a majority of international funds aim to invest in emerging markets. Says Nilesh Shah, deputy managing director, ICICI Prudential Mutual Fund, “Investing in international funds helps to diversify the portfolio but investors should not forget to see the fund manager’s competency and his expertise in managing international funds.” Country risk: Investing in just one foreign country is akin to investing in a sectoral fund that invests in just one sector rather than diversified equity funds that invest across sectors. There are several micro- and macro-economic and geopolitical factors that affect a country’s economic performance. Investing in international funds could be rewarding when certain countries are doing better than Indian markets, and if your fund is invested in any of them. They offer another way to diversity your investment portfolio and a chance to own phenomenal stocks such as Microsoft, Google, Siemens and the like with a tidy sum. The changing equation On the face of it, international funds offer diversification. But is there enough merit in diversifying across countries? We ran two sets of numbers. If you look at the year-on-year returns of major stock market indices across the globe, international funds make sense. For instance, in the sample of emerging and developed economies we have considered, Mexico topped the charts in 2004 and Brazil scored in 2005. Look at China’s returns—while the Shanghai stock market outperformed the lot in 2006 and 2007, it was the worst performer in 2004, 2005 and 2008. But those were annual returns. Typically, though, you invest in equity funds with a long-term horizon. So, had you invested in the Indian markets as against any of the international markets five years back, and held on to your investments, you would not have regretted your move. Between 1 January 2004 and September 2009, the Sensex returned 19.71%. Had you invested in Japan or, say, the Dow Jones of the US, you would have lost your money. Says Surajit Misra, national head, mutual fund, Bajaj Capital: “There should not be more than 15-20% of international fund exposure in your portfolio, and it should be more focused on Asian markets. Also, the time horizon should be longer than for domestic funds, as only then it will serve the purpose of diversification.” Though the fall in 2008 was drastic globally, the recovery in some emerging markets, such as India, has been dramatic. So far, in 2009, the Sensex has returned 68%, followed by China (54%). Market experts say the main reason for India’s fast recovery is strong internal consumption and domestic demand, against China’s reliance on exports. The US and many other countries in Europe, however, are still reeling under unemployment. This also affects consumption. Although the Indian economy received a big jolt in 2008, its resilience to the downturn compared with many global economies is well documented. Experts still believe India is a favourite destination for foreign inflows on reasonable valuations and sound fundamentals. What you should do While conventional investment wisdom calls for diversification, investing in international funds goes beyond the principles of diversification. Once you pass the first level of diversification (investments within India) across sectors and scrips, either directly or through the mutual fund route, you come across a whole set of complicated factors, which may or may not necessitate global diversification. As a thumb rule, avoid country-specific funds as their fortunes depend on the movement of a single country. If you must go for international funds, go for those that invest their entire corpus internationally. Avoid international funds if you are bullish on the long-term India growth story and believe there is enough money to be made in the country. As Pune-based financial planner Veer Sardesai says, “Investing in international funds is more like owning an international brand car, when even an Indian car can serve the purpose.” CONNECT Business loan customer? Now pay less interest Business loan customers have reason to smile. In a bid to check defaults, Barclays Global Retail and Commercial Banking (GRCB) India has introduced a reducing rate of interest for customers who pay their instalments regularly over a period of 12 months. The interest rate would reduce by 1 percentage point after every 12 months of regular payment for the entire loan term. This new concept, called the Drop Down Feature, is one of its kind and has been launched in view of the rising number of defaults in a weak economy. Ponder over The difference between floating rate education loans and fixed rate ones is less than 1% per annum. So, unless you are sure about paying off the loan very quickly after finishing your course, it might be advantageous for you to plump for the relative safety of the fixed interest rate, especially since interest rates are widely expected to have bottomed out and are likely to rise over the next few quarters. In any case, this is not a one-time decision. You need to review it continuously based on changes in the marketplace, and switch if required. Important to know Ordinarily, a loan against property can be obtained against any property that you own. Therefore, you can obtain a loan against property even if you stay in a cooperative society. However, there are some differences in getting a loan against a house that is part of a cooperative society, any other apartment or independent house. In the case of a cooperative society, you will need to inform the bank that placing the house as collateral for the loan has the approval of the housing society. Looking for vehicle insurance, just check the co-payment clause If you are looking for vehicle insurance, look out for the co-payment clause. Also known as “excess” in the policy, it makes you bear a portion of the claim. A higher excess would mean a lower premium since you shift some of the risk from the insurer on to yourself. So, if you agreed on a voluntary deductible of Rs2,500 and there is a claim for Rs7,500, the insurer will pay Rs5,000. Though you cannot take a deductible of more than Rs15,000, the option still makes sense. But if you can’t afford to pay a higher portion of the claim, then don’t bump up your excess. Content provided by Outlook Money Write to us at outlookmoney@livemint.com Source: LatestNews-Home - Livemint.com | 15 Nov 2009 | 12:45 pm ONGC says gas prices likely to go upMumbai: Oil and Natural Gas Corp., India’s largest state-owned oil explorer, said the government is considering a proposal to increase the administered price of natural gas, without saying where it got the information. The gas price for ONGC during the financial year ending 31 March would rise to Rs4,142 per million standard cubic meter as per the proposal, the company said in an emailed statement. The New Delhi-based company said it received a price of Rs2,850 per mscmd for the gas it produced from October 1997 through June 2005. Source: LatestNews-Home - Livemint.com | 15 Nov 2009 | 12:45 pm Essar buys Warid's operationRuias-owned Essar group announced acquisition of majority stake in Dhabi Group's Warid Telecom operation in Uganda and Congo.Source: India Business News | Business News - Times of India | 15 Nov 2009 | 12:41 pm Grupo Mexico beats Sterlite in Asarco raceA district court in Texas has favoured Grupo Mexico's $2.4 billion bid over that of Sterlite Industries, media report said.Source: India Business News | Business News - Times of India | 15 Nov 2009 | 12:37 pm UltraTech, Samruddhi merger okayedThe cement consolidation plan of Aditya Birla group, involving merger of Samruddhi Cement into UltraTech Cement, has got the go-ahead of the respective boards.Source: India Business News | Business News - Times of India | 15 Nov 2009 | 12:34 pm Returns of mid-cap funds declineMid-cap funds which have been the fire flies in the past few months seems to be taking a heavy beating as the markets enter the corrective zone.Source: India Business News | Business News - Times of India | 15 Nov 2009 | 12:23 pm Mukesh ups focus on milk segment with 'Dairy Pure'Milk is industrialist Mukesh Ambani's newest business muscle and his corporate dairy is looking for refrigerator space at mom and pop stores.Source: India Business News | Business News - Times of India | 15 Nov 2009 | 12:20 pm Financial sector reforms: the buck does not stop with RBIAre winds of change blowing through the hallowed portals of India’s central bank, which turned 75 this year? Last month it took quite a few baby steps towards financial sector liberalization. It expanded the scope of currency futures by allowing stock exchanges to offer future contracts in pairs of euro-rupee, Japanese yen-rupee and pound sterling-rupee in addition to dollar-rupee; introduced plain vanilla credit default swaps, or CDS, for corporate bonds; and permitted banks to set up as many branches as they wish to in smaller cities and towns without its approval.  Winds of change: The Reserve Bank of India is slow in opening up the financial sector, but the government, too, needs to walk the talk. Mint Ahead of these measures, in August, the Reserve Bank of India (RBI) introduced interest rate futures and, in September, put up the draft guidelines on repurchase, or repo of, corporate bonds with a commitment to issue the final guidelines by end-November. And now, within a week of Prime Minister Manmohan Singh announcing at the India Economic Summit of the World Economic Forum that his government will carry out large-scale financial sector reforms to push economic growth, RBI has proposed that banks should be allowed to offer plain vanilla cross-currency options to resident Indians. When it finalizes the draft guidelines, importers and exporters will also be allowed to write and sell put options both in foreign currency-rupee and cross-currencies and earn a premium on them.  The credit for shaking the central bank out of a self-congratulatory mode for protecting the Indian financial system from the brunt of the sub-prime crisis and the global meltdown in the wake of the collapse of US investment bank Lehman Brothers Holdings Inc. goes to finance minister Pranab Mukherjee. In July, in his post-budget meeting with the central board of RBI, Mukherjee focused on the need for financial sector reforms. He spoke about better coordination among regulators, bringing all financial market regulations under the capital market watchdog, and setting up a separate public debt office, relieving RBI of its role as the investment banker for the government. He also called for new regulation for supervision of non-banking finance companies and inclusion of financial stability in the Act that governs the Indian central bank. In the past few years, at least three expert panels have looked at what needs to be changed in the Indian financial sector and who should do it. Let me attempt a status report. Also Read Tamal Bandyopadhyay’s earlier columns Regulatory pre-emptions: Indian banks’ investment in government bonds and cash reserve ratio (CRR), or the portion of deposits kept with RBI, is very high compared with other economies. They should come down. They continue to be very high, 30% of banks’ deposits, even though the regulatory minimum limits on such preemptions have been removed. Directed lending: Currently, 40% of bank loans (35% for foreign banks) are to be given to agriculture and small business units and a substantial portion of them at concessional rates, but it has not helped financial inclusion. Ideally, banks should move from a mandated directed lending target to a market-based approach. Suggestions include allowing banks to set their own targets, making mandated loan obligations tradable and offering direct subsidies instead of forcing banks to give loans at low rates. An internal RBI panel has suggested replacement of mandated loan rates by direct subsidy. The central bank is also in the process of setting up a working group to examine the issues involved in the introduction of priority sector loan certificates and trading them on exchanges. Consolidation: Expert panels have been in favour of consolidation in the Indian banking system and leveraging the scale. One panel even suggests selling small underperforming public sector banks to other banks or strategic investors and allowing acquisitions by domestically incorporated subsidiaries of foreign banks. Nothing has happened so far even as the “too big to fail concept” is being challenged globally. Also, no foreign bank has opted for the local subsidiary route as yet. Abolition of branch licensing: Banks should be free to set up branches and ATMs anywhere, except for foreign banks in urban India. Also, sale, closure and exchange of bank branches should be allowed. Substantial progress has been made on this front. Banks are free to set up ATMs and the domestic players are free to open branches in smaller towns with a population of 50,000 or less, provided at least one-third of such branches are in under-banked pockets. Opening of branches in tier 1 and tier 2 centres continues to require RBI permission. Ownership and management of public sector banks: Direct government ownership in these banks should be reduced from 51% and they should be board-managed companies. Large public sector banks should have stronger boards with possibly a private sector strategic investor; they should have the power to appoint and compensate top executives and take all business decisions without any intervention by the government. Nothing has happened so far. Public sector banks continue to run like a wing of the finance ministry. Rural banking: Small, well-governed, private deposit taking institutions should be allowed to focus on specific geographies on the lines of local area banks. Unviable cooperative banks should be closed and well-run cooperatives with a good track record should be allowed to convert themselves into small banks, with their members becoming shareholders. RBI is planning to revive the rural cooperative credit structure by mergers and capital infusion in regional rural banks and changing the regulatory and supervisory framework for urban cooperative banks. Banking correspondents: A wide range of local agents should be employed to extend financial services. While technology can cut costs to improve the viability of the model, they should be allowed to levy user charges to recover costs of services. RBI has allowed banks to appoint grocery stores, medical and fair price shop owners, individual public call operators, petrol pump owners, agents of small savings schemes, retired teachers and members of well-run self-help groups as banking correspondents. Banks can now impose reasonable service charges on customers. Insurance: The Insurance Laws (Amendment) Bill, 2008, which was introduced by the government in the Rajya Sabha in December 2008, provides for enhancement of share holdings by a foreign company, either by itself or through its subsidiary firms or its nominee in Indian insurance companies from 26% to 49%. The Bill is pending parliamentary approval. Tax rationalization to boost long-term savings: A separate tax exemption limit is recommended for long-term life insurance and pension/annuity products. A similar provision may be considered for investment in dedicated close-ended infrastructure mutual funds and long-term bank deposits. Tax arbitrage between debt mutual funds and bank deposits needs to be minimized/eliminated. The direct tax code proposes the removal of most exemptions to reduce tax arbitrage between various investment schemes. Pension reforms: Private sector entities should be permitted to manage pension funds of Central government employees. Besides, all categories of pension and provident funds should be permitted to diversify their investment portfolios. Private sector entities have been invited to manage pension funds of Central government employees. Changes have been proposed by the finance ministry in provident fund guidelines for more flexibility in investments, especially in corporate and PSU (public sector units) bonds, but they are yet to be approved by the ministry of labour. Debt market: The bond market in India remains limited in terms of nature of instruments, their maturity, investor participation and liquidity. Disclosure requirements have been simplified for listed companies and the cap on investment by foreign institutional investors, or FIIs, has been lifted from $6 billion to $15 billion. The final guidelines for repo in corporate bonds will be released later this month. Plain vanilla over-the-counter CDS for corporate bonds for resident Indians are being introduced. Derivative markets: Currency and interest rate derivative market is a key missing link in Indian markets. Besides, banks are not permitted to deal in equity derivatives and commodity derivatives. Exchange-traded interest rate futures were introduced in August and their scope has been increased by permitting currency futures contracts in three other currency pairs beside dollar-rupee. Regulations: The expert panels are divided on the critical issue of single regulator versus multiple regulators. The finance ministry seems to believe that all market regulations and supervision should be consolidated under the Securities and Exchange Board of India, or Sebi. The capital market regulator should oversee trading of currency futures, interest rate futures, government and corporate bonds. RBI has strong reservations on this proposal. There are quite a few other suggestions. For instance, financial houses should be allowed to set up holding companies for various intermediaries that come under different regulators. A financial holding company can raise and allocate resources in various subsidiary companies, depending on their needs, thereby using capital efficiently within the group as well as segregating risks across various financial businesses. Such holding companies should be supervised by a financial sector oversight agency while its subsidiaries will continued to be regulated and supervised by respective regulators. Indeed RBI is slow in opening up the financial sector and withdrawing from certain areas where Sebi should step in, but the government, too, needs to walk the talk. In three most critical areas of reforms—ownership of public sector banks, insurance firms and banking consolidation—the onus is on the government to change the rules of the game. The buck does not stop with RBI. Tamal Bandyopadhyay keeps a close eye on all things banking from his perch as a deputy managing editor of Mint in Mumbai. Please email comments to bankerstrust@livemint.com Source: LatestNews-Home - Livemint.com | 15 Nov 2009 | 12:00 pm Singur renews its date with land protestsThis time over BHELs power project proposal.Source: Business Standard | Front Page Headlines | 15 Nov 2009 | 11:45 am GE sees healthy gains in low-cost medical devicesFrom upgraded portable ECG machines to digital X-ray units, the research lab does them all.Source: Business Standard | Front Page Headlines | 15 Nov 2009 | 11:44 am Sebi plans fresh round of mutual fund reformsAdvisory committee for lower charges, stricter compliance.Source: Business Standard | Front Page Headlines | 15 Nov 2009 | 11:42 am The science of predicting an earthquakeGhuttu, Uttarakhand: Perched at an altitude of 6,000ft, among the scenic peaks of the Lower Himalayas and the verdant Bhilganga Valley, a group of mild-mannered scientists are pottering around their instruments, eagerly awaiting the next big earthquake.  Precursor watch: Researcher Naresh Kumar adjusting a gravimeter. Ramesh Pathania / Mint “At least a 6 (in magnitude) and within a 200km radius,” says Naresh Kumar, a researcher in his mid-30s, with the Wadia Institute of Himalayan Geology (WIHG) in Dehradun. Since 2007, Kumar has been shuttling between his workstation in Dehradun and Ghuttu, a charming hamlet 200 rubbled-and-winding kilometres away. Unknown to even most of its local population, Ghuttu hosts India’s first coordinated attempt at studying earthquake precursors—or warning signals to a coming earthquake. The laboratory, called the Multiparametric Geophysical Observatory, atop an isolated hill, is much more than the six white rooms spread across an area slightly more than half a hockey field. Each of these cramped quarters hosts instruments such as gravimeters, essentially ultrasensitive weighing machines, and specialized magnetometers that measure minute changes in the gravitational force, the ups and downs of the magnetic field surrounding the rocks within a 50km radius, as well as continuously survey the radioactivity of the water table in the vicinity. There are the workhorse seismometers, too, which have long helped scientists pinpoint the intensity and location of an earthquake. But these other instruments, which continuously stream data via a VSAT satellite connection to Dehradun, are helping these scientists create an electromagnetic profile of the rock structure in these parts. “In another decade, we should be able to quantify whether we can record earthquake precursors of earthquakes of magnitude 5 and above,” says Baldev Arora, former director, WIHG, and credited with setting up the laboratory. Since the 1970s, scientists internationally have been mapping prominent earthquake-prone zones such as the San Andreas Fault, which runs across California, for unusual electromagnetic signals, or structural fissures and strains in the rock patterns. Such signals are a sign that pressure, or vast reserves of heat and radiation, are bubbling up over time between tectonic plates that are continually moving and at various times may collide, diverge or slide against one another. These energy vents begin to disturb the rocks that lie on these plates and leave a variety of signatures that are picked up by magnetometers or gravimeters. Current theories say that the Indian land mass, which rests on a plate called the Indo-Australian Plate, is sliding along another massive structure called the Asian Plate, which includes China and Japan. The ensuing energy release from this friction not only created the Himalayas, but also spread along a line called the Main Central Thrust (MCT), a 2,500km long zone that stretches from Bhutan to well beyond India’s western border. This line hosts several tectonic rocks, ones that are perched along one another and by virtue of their unsteady nature are subject to changing gravitational pulls and pressure, that are most likely to trigger earthquakes. Even though India doesn’t see as many significant earthquakes as parts of the US or Japan, it has lost several thousand lives to earthquakes in the 20th century. Though the most vivid earthquakes in India’s memory may be the Bhuj earthquake of January 2001 in Gujarat and the Latur earthquake of September 1993 in Maharashtra, experts say that historically quakes are far more frequent in northern and north-eastern India. The government’s latest seismic zoning maps list Uttarakhand, Sikkim, Himachal Pradesh, Bihar and parts of Delhi as category 4 and 5—making them the most earthquake-prone regions in the country. “In putting up a centre over here, we’ve made a balanced, well-thought-out gamble,” says Arora. That’s because India’s biggest earthquakes in the last century, such as the Kangra quake (7.5 magnitude) in 1905, and the Bihar quakes in 1934 (8.6 magnitude) and 1950, were all along different points in MCT. Given the volatility of MCT, a big earthquake—of at least 6.5 magnitude—within a 50km radius of Ghuttu is imminent. “This region has not seen a big one in 200 years. So it’s only a matter of time,” Arora emphasized, without specifying a time frame. Apart from Ghuttu’s coordinates—it is a mere 5km off the MCT fault line—what worked in its favour was the abundance of so-called hard rock, which makes it easier to record shifts in gravity and the magnetic fields, as well as its relative isolation from human settlements. “In Srinagar, when we were testing some of these instruments, most of the readings on the instruments were from people kick-starting their scooters,” says Arora. Recent significant earthquakes such as the 1991 Uttarkashi and 1999 Chamoli earthquakes are located around MCT, but were of less than 7 magnitude. The vagaries of gravity and magnetic fields apart, scientists here are also looking at the concentration of radon gas—a by-product of uranium decay—in the water table as an earthquake precursor. The metric has gained importance ever since Chinese scientists included such data to accurately predict the 1975 earthquake in Haicheng, China. However, the scientists at Ghuttu are yet to sense success. The researchers add that a “small” earthquake, 60km away, that touched 5 on the Richter scale didn’t generate any unusual early warning signals on the gravimeter that weighs about a tonne and boasts an ultrasensitive niobium sensor bathed in super-cooled liquid helium, and that is even sensitive to footsteps. Still, “there were changes during the earthquake, but the magnetic fields and the radon did show some unusual readings a few days before”, says B.I. Khandelwal, another scientist who does 20-day stints atop the lonely hillock, “at least once in two months”. The researcher, who is responsible for everything from taking readings twice a day on the magnetometers to ensuring a steady power supply for the gravimeter, says he is used to the solitude and the silences. “It does get boring, because the newspapers don’t come here. But now it’s much better,” he says. The comfort comes from power cuts lasting a “mere” 6 hours compared with outages lasting as long as 7-15 days at a time earlier. Also, the newly installed Airtel tower nearby means he can have uninterrupted conversations with his family instead of climbing the nearby water tank and banking on stray, ephemeral signal. But the occasional leopard is still a worry. “I never leave this place without a bat,” Khandelwal says of his occasional nightly trips to the village for provisions and newspapers. Despite several instruments and rigorous monitoring, most earthquake precursors are still iffy. “In 1976, the very next year (after the Haicheng quake), the Chinese completely missed a huge quake, and the radon levels were normal. Similarly, the San Andreas Fault was to throw a major quake in the early 1990s, but all that we got was a 5 magnitude one—that too 11 years later. So, nature always surprises us,” says Arora. jacob.k@livemint.com Source: Tech News - Livemint.com | 15 Nov 2009 | 11:23 am The science of predicting an earthquakeGhuttu, Uttarakhand: Perched at an altitude of 6,000ft, among the scenic peaks of the Lower Himalayas and the verdant Bhilganga Valley, a group of mild-mannered scientists are pottering around their instruments, eagerly awaiting the next big earthquake. Precursor watch: Researcher Naresh Kumar adjusting a gravimeter. Ramesh Pathania / Mint “At least a 6 (in magnitude) and within a 200km radius,” says Naresh Kumar, a researcher in his mid-30s, with the Wadia Institute of Himalayan Geology (WIHG) in Dehradun. Since 2007, Kumar has been shuttling between his workstation in Dehradun and Ghuttu, a charming hamlet 200 rubbled-and-winding kilometres away. Unknown to even most of its local population, Ghuttu hosts India’s first coordinated attempt at studying earthquake precursors—or warning signals to a coming earthquake. The laboratory, called the Multiparametric Geophysical Observatory, atop an isolated hill, is much more than the six white rooms spread across an area slightly more than half a hockey field. Each of these cramped quarters hosts instruments such as gravimeters, essentially ultrasensitive weighing machines, and specialized magnetometers that measure minute changes in the gravitational force, the ups and downs of the magnetic field surrounding the rocks within a 50km radius, as well as continuously survey the radioactivity of the water table in the vicinity. There are the workhorse seismometers, too, which have long helped scientists pinpoint the intensity and location of an earthquake. But these other instruments, which continuously stream data via a VSAT satellite connection to Dehradun, are helping these scientists create an electromagnetic profile of the rock structure in these parts. “In another decade, we should be able to quantify whether we can record earthquake precursors of earthquakes of magnitude 5 and above,” says Baldev Arora, former director, WIHG, and credited with setting up the laboratory. Since the 1970s, scientists internationally have been mapping prominent earthquake-prone zones such as the San Andreas Fault, which runs across California, for unusual electromagnetic signals, or structural fissures and strains in the rock patterns. Such signals are a sign that pressure, or vast reserves of heat and radiation, are bubbling up over time between tectonic plates that are continually moving and at various times may collide, diverge or slide against one another. These energy vents begin to disturb the rocks that lie on these plates and leave a variety of signatures that are picked up by magnetometers or gravimeters. Current theories say that the Indian land mass, which rests on a plate called the Indo-Australian Plate, is sliding along another massive structure called the Asian Plate, which includes China and Japan. The ensuing energy release from this friction not only created the Himalayas, but also spread along a line called the Main Central Thrust (MCT), a 2,500km long zone that stretches from Bhutan to well beyond India’s western border. This line hosts several tectonic rocks, ones that are perched along one another and by virtue of their unsteady nature are subject to changing gravitational pulls and pressure, that are most likely to trigger earthquakes. Even though India doesn’t see as many significant earthquakes as parts of the US or Japan, it has lost several thousand lives to earthquakes in the 20th century. Though the most vivid earthquakes in India’s memory may be the Bhuj earthquake of January 2001 in Gujarat and the Latur earthquake of September 1993 in Maharashtra, experts say that historically quakes are far more frequent in northern and north-eastern India. The government’s latest seismic zoning maps list Uttarakhand, Sikkim, Himachal Pradesh, Bihar and parts of Delhi as category 4 and 5—making them the most earthquake-prone regions in the country. “In putting up a centre over here, we’ve made a balanced, well-thought-out gamble,” says Arora. That’s because India’s biggest earthquakes in the last century, such as the Kangra quake (7.5 magnitude) in 1905, and the Bihar quakes in 1934 (8.6 magnitude) and 1950, were all along different points in MCT. Given the volatility of MCT, a big earthquake—of at least 6.5 magnitude—within a 50km radius of Ghuttu is imminent. “This region has not seen a big one in 200 years. So it’s only a matter of time,” Arora emphasized, without specifying a time frame. Apart from Ghuttu’s coordinates—it is a mere 5km off the MCT fault line—what worked in its favour was the abundance of so-called hard rock, which makes it easier to record shifts in gravity and the magnetic fields, as well as its relative isolation from human settlements. “In Srinagar, when we were testing some of these instruments, most of the readings on the instruments were from people kick-starting their scooters,” says Arora. Recent significant earthquakes such as the 1991 Uttarkashi and 1999 Chamoli earthquakes are located around MCT, but were of less than 7 magnitude. The vagaries of gravity and magnetic fields apart, scientists here are also looking at the concentration of radon gas—a by-product of uranium decay—in the water table as an earthquake precursor. The metric has gained importance ever since Chinese scientists included such data to accurately predict the 1975 earthquake in Haicheng, China. However, the scientists at Ghuttu are yet to sense success. The researchers add that a “small” earthquake, 60km away, that touched 5 on the Richter scale didn’t generate any unusual early warning signals on the gravimeter that weighs about a tonne and boasts an ultrasensitive niobium sensor bathed in super-cooled liquid helium, and that is even sensitive to footsteps. Still, “there were changes during the earthquake, but the magnetic fields and the radon did show some unusual readings a few days before”, says B.I. Khandelwal, another scientist who does 20-day stints atop the lonely hillock, “at least once in two months”. The researcher, who is responsible for everything from taking readings twice a day on the magnetometers to ensuring a steady power supply for the gravimeter, says he is used to the solitude and the silences. “It does get boring, because the newspapers don’t come here. But now it’s much better,” he says. The comfort comes from power cuts lasting a “mere” 6 hours compared with outages lasting as long as 7-15 days at a time earlier. Also, the newly installed Airtel tower nearby means he can have uninterrupted conversations with his family instead of climbing the nearby water tank and banking on stray, ephemeral signal. But the occasional leopard is still a worry. “I never leave this place without a bat,” Khandelwal says of his occasional nightly trips to the village for provisions and newspapers. Despite several instruments and rigorous monitoring, most earthquake precursors are still iffy. “In 1976, the very next year (after the Haicheng quake), the Chinese completely missed a huge quake, and the radon levels were normal. Similarly, the San Andreas Fault was to throw a major quake in the early 1990s, but all that we got was a 5 magnitude one—that too 11 years later. So, nature always surprises us,” says Arora. jacob.k@livemint.com Source: Home - Livemint.com | 15 Nov 2009 | 11:23 am Letters from the war zone Bijapur, Chhattisgarh: Dear Comrade Kavita didi, I send you a lal salaam (red salute). Kavita didi, I don’t know how you are.  Committed to the cause: A 3 July letter addressed to Comrade Kavita is written in longhand on a notebook, later seized by the police in a raid. Even in personal letters, young Maoist guerrillas talk only of their war. Even in personal letters, young Maoist guerrillas talk only of their war. The letter in the Gondi language, signed by “Comrade Kital” of the Indrawati National Park dalam (military unit) was written in longhand on 3 July on a school notebook, later seized by the police in a raid. This, and numerous other letters, give a window into the tough life and resolve of Maoist guerrillas who have for 42 years fought the Indian state, living in the forests. That battle has spiralled now, with its shadow across a quarter of India, and Prime Minister Manmohan Singh calls it the country’s biggest internal security crisis. It has gritty foot soldiers.  “Their military company is equally well trained as the police and paramilitary,” says Vishwa Mohan, director-general of Chhattisgarh police, who has for long studied the Maoist insurgency, and as a student bought a banned 32-book set of Mao’s teachings at the College Street market in Kolkata. The Maoists have a complex structure that rises from the “sangam”, a small village unit that is their eyes and ears on the ground, also arranging meetings of rebels and villagers and arranging food for the guerrillas. The militia, a rank above, is armed with bows and arrows, including those tipped with detonators. The local guerrilla squad (LGS) forms the strongest local base, merging into platoons and companies and divisions. Even police officers have grudging admiration for their adversary. “The beauty is their structure. You can eliminate fighters, but (it is) very hard to kill the structure,” says an officer, speaking on condition of anonymity as he is not authorized to talk on the subject to the media. “He (the Maoist) is very smart, very intelligent, very systematic, very methodical. Every operation could be preceded by months of preparation,” the officer adds. Like the one on 5 June, in Dhanaura village in the Nelnar area. “Dear Comrade Chaitu dada... Policemen used to go for ablutions every day at 5am, so our comrade was waiting in ambush in civil clothes, with a bow and arrow,” says a 20 July letter from Comrade Rita. “They emerged like every day, our comrade got him with the arrow. He was wounded but did not die…we ambushed again on the 8th in civil clothes from three places. One policeman died and another was wounded.” There are accounts of operations, including one that went horribly wrong. “In the Pallamandi area, we carried out an explosion assuming it is policemen, but seven teachers died. In another incident, we have ambushed and killed 15 policemen and seized 16 guns,” says a letter of 14 June from Raju of the Manpur division, operating in the Bastar region in southern Chhattisgarh. He listed details of how they carried out 28 other police killings. There are allegations of police excesses: “In the month of June, policemen came to Benchapal, they burnt down homes. They killed dada in firing, and raped women and killed them.” “Dear Comrade Raju…I am fine, I am working for the party with all my heart and soul,” says another seized letter, the sender’s name is not legible. “During the last assembly elections, the police had forced people of this area to vote. So our party workers have explained to the people that on the day of the Lok Sabha elections, no villager will remain in their village. A committee has been formed to hide the people.” Maoist guerrillas are even transferred, and promoted. The letters give a glimpse of friendships forged on the battleground. “Comrade, please read out my letter to Comrade Chaini, Comrade Mannu, Comrade Budhram, Comrade Ayte and Comrade Sundru, who are with you. Tell them all to write to me,” says a letter signed by Ashok, of the National Park LGS in southern Bastar, near the Andhra Pradesh border. “Dear Comrade Somali…Sukko of my village is also in the Maad dalam. To take forward the revolution, Comrade Supal is also in the Gadhchiroli district—his name has been changed,” says a letter of 14 June from Raju of the Manpur division, operating in the Bastar region. “He is now called Comrade Kishore. If you meet him, tell him Raju sent a red salute.” Source: LatestNews-Home - Livemint.com | 15 Nov 2009 | 11:21 am Quick Edit | Schumpeter in India Hopes of a new wave of economic reforms are once again in the air. There is little doubt that more than 25 years of reforms have lifted growth rates in India and helped pull millions out of poverty. An India that mortgaged gold in 1991 has now bought 200 tonnes of it from the International Monetary Fund. But economic reforms offer another promise: the opportunity for new firms to elbow out incumbents and inject continuous economic vitality. New research by Laura Alfaro and Anusha Chari suggests that this promise has not been met. State-owned companies and firms set up before 1985 continue to dominate the business landscape; the only exception is the growing importance of new private companies in the services sector. Why does India’s business structure continue to be ossified? Is this an indication of oligopolistic capitalism? Do new firms not get access to finance? Does the inspector raj hit start-ups harder than older firms that have learnt to game the system? These are reasons for worry if you believe in Schumpeterian renewal. Source: LatestNews-Home - Livemint.com | 15 Nov 2009 | 11:13 am Tariff war cuts short telecom growth dream New Delhi: It may be early days yet, but numbers gleaned from the second-quarter results of India’s telecom companies suggest the industry could be headed for a plateau as a tariff war erodes their revenue and earnings, offsetting the effect of subscriber additions. Also See Taking A Toll (Graphics) While the second quarter has traditionally been marked by muted earnings, this time around the pace of earnings growth is showing clear signals of tapering. The primary reason for this, according to analysts, is the price competition that is expected to continue for some time till consolidation starts in the sector. Operators, however, don’t see the ultra-low call rates extending beyond two-three quarters. At the India Economic Summit this month in New Delhi, Bharti Airtel Ltd chief executive officer and joint managing director Manoj Kohli said the tariff war wasn’t sustainable beyond the short term. The tariff war was initiated by Tata Teleservices Ltd for its new global system for mobile communications, or GSM, network-based mobile service branded Tata DoCoMo, which launched its one paisa per second call charge scheme in July. The move was quickly followed by Aircel Ltd, MTS, Vodafone Essar Ltd and also Reliance Communications Ltd, or RCom, and the state-owned Bharat Sanchar Nigam Ltd. With mobile number portability, or MNP, “around the corner, subscribers can migrate to a better proposition of a better tariff plan and network without changing their number”, said Lloyd Mathias, chief marketing officer, Tata Teleservices (TTSL). “The sooner we up the ante on that proposition, the better; and the best time for that is now—a couple of months away from implementation of MNP,” he added. Bharti Airtel threw its hat into the ring a few hours after saying that it would not match the lowest common denominator in the market on 29 October, when it announced its results for the second quarter of the fiscal year. For the first time in its history, Bharti Airtel reported a sequential decline in its wireless revenue, while total network minutes growth was only 2% compared with the previous quarter and lower than 3.3% posted by smaller rival Idea Cellular Ltd. Big three Airtel, the country’s largest mobile phone service provider, while recording an increase in its net profit by 13% to Rs2,321.6 crore for the September quarter, from Rs2,050 crore for the same period a year ago, saw its profits fall 9.5% on a sequential basis. Total revenue grew 9% to Rs9,850 crore ($2.1 billion) over the same period last year, but fell almost 1% from the first quarter. Similarly Mumbai-based RCom, Airtel’s closest rival, announced that net profit fell by 54.8% to Rs740 crore for the quarter ended September, from Rs1,531 crore a year earlier. Revenue for the September quarter rose 1% to Rs5,703 crore from a year earlier. Revenue at Vodafone Group Plc’s India arm, Vodafone Essar, the country’s third largest mobile phone firm by subscribers, dropped 7% sequentially to £704 million (Rs5,435 crore) for the September quarter. The company posted a £43 million loss in the first six months of the fiscal against a profit of £7 million for the corresponding period last year. The telco does not provide a quarterly break-up of profits from its Indian operations. According to data compiled by the Telecom Regulatory Authority of India, or Trai, the industry’s gross revenue (excluding fixed-line phones) for the quarter ended September was Rs38,755 crore. This was lower than the sector’s revenue in the quarter ended December 2008, when it recorded Rs39,408 crore, even though it had 125 million fewer customers then. Despite a record addition of just under 45 million new customers, the highest in a quarter, in the January-March period, the sector’s revenue increased only marginally to Rs40,445 crore compared with the corresponding quarter last year. Since then, it has been on a downward spiral—falling to Rs39,108 crore and Rs38,755 crore in the quarters ended June and September, respectively, according to Trai data. ‘Backs to the wall’ “With the stronger incumbents entering the tariff game and bringing their per second cost to one paisa, the new operators will have their backs to the wall. There is very little room to move once you come down to half a paisa a minute, considering the minimum cost for an off-net call is 20 paisa per minute,” an analyst with a Mumbai-based brokerage said. He didn’t want to be named because he is not authorized to speak to the media. “They will bleed for a while, but will be able to sustain for a couple of years,” he added. According to Kunal Bajaj, managing director with strategy consulting firm BDA Connect (India) Pvt. Ltd, the incumbent operators did not need to get into a tariff war. They could have stayed passive spectators, watching the newer operators pile up losses. “It would have been better had they lasted the tough period and then with a strong balance sheet and numbers led the consolidation in the market,” he said. With operators such as Aircel and Tata Teleservices in expansion mode and at least three new operators getting ready to launch, including Etisalat and Unitech Ltd-Telenor SA joint venture Uninor, the incumbent operators seem to have nothing left to do but match the “lowest common denominator” in the market. Sistema Shyam Teleservices Ltd-promoted MTS recently took the tariff war to a new low by announcing its half a paisa per second plan for local calls on other networks and a quarter paisa for calls within its network. Earlier, Anil Ambani-promoted RCom extended its Simply Reliance Initiative, where tariffs are one paisa per second for short duration calls (up to 3 minutes) and Re1 for calls of long duration (extending beyond 3 minutes). RCom also continues its 50 paisa per minute tariff along with these, announced on 5 October. Revenue destruction A recent report on the telecom sector’s revenue market share by Rajiv Sharma, telecom analyst with Mumbai-based HSBC Securities and Capital Markets (India) Pvt. Ltd, said that while wireless revenue for the sector was flat sequentially, companies such as Tata Teleservices had seen their market share go up by 40 basis points whereas Airtel and Vodafone saw their revenue market shares decline by 50 basis points and 30 basis points, respectively. One basis point is one-hundredth of a percentage point. “In Q2FY10 (second quarter of 2009-10), 11 telecom circles saw q-o-q (quarter-on-quarter) revenue deceleration, leading to flat sector revenues,” the report said. “We attribute the lower growth to the poor monsoon, seasonality, increasing competitive intensity and declining revenue realization, largely driven by the per second offering by Tata Teleservices,” it added. Sharma also said his firm would remain cautious on the sector, given the rapidly declining revenue per minute and a move by the entire sector to a per-second billing format, which will be revenue-destructive. The sector is expected to get highly capital-intensive in terms of technology, given the impending 3G spectrum auction, and the need for expansion to enable companies to stay competitive, said Harit Shah, an analyst with Angel Broking Ltd. In a 4 November research report on Indian equities, a Macquarie Group analyst took a negative investment view on the sector and recommended that investors “avoid Indian telecoms as dynamic game of price positioning (is) expected to be played out in the next two-three quarters”. Graphics by Sandeep Bhatnagar / Mint Source: LatestNews-Home - Livemint.com | 15 Nov 2009 | 11:13 am 3 mistakes to avoid when letting someone goFiring someone is awful, both for the person doing the firing and, obviously, for the person being asked to leave. Most good managers find the actual deed incredibly difficult. The person being let go might be having the worst day of his career. So how do you manage a parting of ways with as little pain and damage as possible? The answer is pretty straightforward: Managers need to accept that letting people go is a process that they must fully own and pay careful attention to several dos and don’ts. Usually, the choice to fire someone for non-performance isn’t black and white, since precisely who did what and what went wrong in the lead-up to the finale can be unclear. For this reason, managers often get firings wrong in one of three ways:  My friend addressed these shortcomings with Richard, to no avail. Finally, an important customer called to complain that his shipment was a week late. My friend had had it. Richard had to go. To many, including Richard, the decision came as a surprise. Some staffers felt that he had not been given enough warning and they complained that they could no longer trust their boss or the organization. Also See Jack and Suzy Welch videos It took my friend around three months to restore equilibrium and get her unit moving again. 2. Not being candid enough: Say you’ve got a long-time employee named Gail, who can’t reach her sales quotas no matter how hard she tries. Every time you try to tell her how badly she’s doing, she’s so cheerful and oblivious that you end up hiding your negative feelings behind a mixed message about “working smarter”. The situation culminates when Gail really screws up, and you impulsively fire her. Shocked, she reminds you of all the positive feedback you have given her over the years, and ultimately leaves angry and bitter. This may not be the last you hear of her. Every employee who leaves continues to represent your company. For the next five, 10 or 20 years, they will either bad-mouth or praise your organization. 3. Taking too long: The third mistake occurs when a firing happens too slowly. Everyone knows that a person is about to be fired, including the person himself, but the boss waits a long time to pull the trigger. The result is enormous awkwardness in the office that can lead to a sort of paralysis. Why do bosses allow this to occur? Well, firing is so tough that no one likes to do it, and so the event often gets delayed. But sometimes in this situation a manager lets an employee twist in the wind because he wants the victim’s peers to see the necessity of the decision. In a way it’s cruel, but most bosses would rather be known as careful than quick on the trigger. If there are so many ways that firing can go wrong, how do you avoid making mistakes? 1. No surprises: Very simply, a good performance evaluation process informs and prepares people for what’s ahead in the fairest, most open way possible. If people know where they stand, no one actually gets fired. Instead, when things are not working out, there is eventually a mutual understanding that it’s time to part ways. In some instances, it can take a couple of years for the endgame to become clear to everyone, but along the way, there will have been many candid conversations about performance and career goals. The possibility of parting ways will have been raised and discussed openly. 2. Minimize humiliation: For a boss, finally delivering the bad news elicits relief. “It’s over,” you tell yourself. “I did it kindly, and now I can focus on other work.” However, your employee is probably pretty upset. If you’ve done everything right, he won’t be surprised, but he may still be feeling hurt. The next day and until he departs, you must make sure he doesn’t feel like an outcast in a leper colony. Build up his self-confidence. Let him know there is a good job for him out there—a job that better matches his skills. You may even help him find it. Your goal for the fired employee is a soft landing wherever he goes. Firings are an unfortunate reality of business. Still, if you handle them right, they can at least be tolerable for the people involved. When it’s time to let someone go, do it right. No surprises. No humiliation. 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. ©2009/The NYT Syndicate Adapted from Winning (HarperBusiness Publishers, 2005) by Jack Welch with Suzy Welch.) Source: World Business - Livemint.com | 15 Nov 2009 | 8:51 am
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