Rupee appreciates further by 13 paise against dollar

The rupee on Wednesday appreciated by 13 paise against the U.S. currency on sustained dollar selling by exporters.

At the Interbank Foreign Exchange (Forex) market, the local unit closed 13 paise lower at 45.09/10 a dollar. The rupee had gained 25 paise on Tuesday.

Dealers attributed further rise in the rupee to continued dollar selling by exporters and some banks.

Weakness in dollar in European market on Wednesday also helped the rupee rally. The dollar index, gauging of six major currencies, was down by 0.26 per cent.

The rupee opened nearly steady at 45.23/24 a dollar and it immediately touched a low of 45.26 a dollar. However, it recovered later to the day’s high of 45.07 before concluding at 45.09/10 a dollar.

The rupee premium for the forward dollar remained firm on sustained paying pressure from banks and corporates. The benchmark six-month forward dollar premium payable in May closed up at 128-1/2-130-1/2 paise from 127-129 paise on Tuesday.

Far-forward contracts maturing in November also finished higher at 236-1/2-238-1/2 paise from 230-232 paise previously.

The Reserve Bank of India fixed the reference rate for the dollar at Rs. 45.13 and the euro at Rs. 59.32.

The rupee shot up further to Rs. 69.66/68 against the pound sterling from Tuesday’s close of Rs. 70.06/08 and also hardened to Rs. 59.27/29 per euro from Rs. 59.49/51 previously.

It too improved further against the yen to Rs 54.03/05 per 100 yen from its last close of Rs 54.08/10.

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Posted in: BUSINESS NEWS

Rupee appreciates further by 13 paise against dollar

The rupee on Wednesday appreciated by 13 paise against the U.S. currency on sustained dollar selling by exporters.

At the Interbank Foreign Exchange (Forex) market, the local unit closed 13 paise lower at 45.09/10 a dollar. The rupee had gained 25 paise on Tuesday.

Dealers attributed further rise in the rupee to continued dollar selling by exporters and some banks.

Weakness in dollar in European market on Wednesday also helped the rupee rally. The dollar index, gauging of six major currencies, was down by 0.26 per cent.

The rupee opened nearly steady at 45.23/24 a dollar and it immediately touched a low of 45.26 a dollar. However, it recovered later to the day’s high of 45.07 before concluding at 45.09/10 a dollar.

The rupee premium for the forward dollar remained firm on sustained paying pressure from banks and corporates. The benchmark six-month forward dollar premium payable in May closed up at 128-1/2-130-1/2 paise from 127-129 paise on Tuesday.

Far-forward contracts maturing in November also finished higher at 236-1/2-238-1/2 paise from 230-232 paise previously.

The Reserve Bank of India fixed the reference rate for the dollar at Rs. 45.13 and the euro at Rs. 59.32.

The rupee shot up further to Rs. 69.66/68 against the pound sterling from Tuesday’s close of Rs. 70.06/08 and also hardened to Rs. 59.27/29 per euro from Rs. 59.49/51 previously.

It too improved further against the yen to Rs 54.03/05 per 100 yen from its last close of Rs 54.08/10.

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Posted in: BUSINESS NEWS

JSW launches open offer at Rs 20.54 a share for 20% in Ispat

MUMBAI: JSW Steel today launched an open offer to buy 20 per cent additional equity in Ispat Industries at Rs 20.54 a share, over three per cent lower than closing price on BSE yesterday.

After the public announcement of open offer, Ispat scrip today ended at Rs 23.60 a piece, 11.32 per cent higher than its previous closing of Rs 21.20m on the Bombay Stock Exchange (BSE).

JSW yesterday announced the Rs 2,157-crore deal to acquire 45 per cent stake in Mittal brothers promoted Ispat Industries.

According to Market regulator SEBI's guidelines, any company buying more than 15 per cent in another firm will have make an offer to buy 20 per cent additional stake.

"Today we have made public announcement to launch open offer at Rs 20.54 a share for Ispat shareholders," JSW Steel's Joint MD and CFO Seshagiri Rao M V S said.

The open offer would cost Rs 1,329.43 crore to the JSW, which post acquisition would be largest domestic steel producer.

Asked when the the open offer would hit the market, Rao said that "JSW has 14 days time to announce the dates of open offer, which is also subject to SEBI approval".

On the other hand, the JSW scrips closed at Rs 1202.90 per piece, down 0.75 per cent.

Enam Securities , who is managing the open offer on behalf of Sajjan Jindal-led company, said in a public announcement that JSW Steel proposes to acquire 64.72 crore shares of Ispat, representing 20 per cent (at a face value of Rs 10 each) of the total shares at a price of Rs 20.54 per share in cash.

The Sajjan Jindal-led company had said on Tuesday that it will buy a 41.29 per cent stake in Ispat through a preferential issue of fresh shares, which will reduce the Ispat promoters' stake to 26 per cent.

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Posted in: BUSINESS NEWS

JSW launches open offer at Rs 20.54 a share for 20% in Ispat

MUMBAI: JSW Steel today launched an open offer to buy 20 per cent additional equity in Ispat Industries at Rs 20.54 a share, over three per cent lower than closing price on BSE yesterday.

After the public announcement of open offer, Ispat scrip today ended at Rs 23.60 a piece, 11.32 per cent higher than its previous closing of Rs 21.20m on the Bombay Stock Exchange (BSE).

JSW yesterday announced the Rs 2,157-crore deal to acquire 45 per cent stake in Mittal brothers promoted Ispat Industries.

According to Market regulator SEBI's guidelines, any company buying more than 15 per cent in another firm will have make an offer to buy 20 per cent additional stake.

"Today we have made public announcement to launch open offer at Rs 20.54 a share for Ispat shareholders," JSW Steel's Joint MD and CFO Seshagiri Rao M V S said.

The open offer would cost Rs 1,329.43 crore to the JSW, which post acquisition would be largest domestic steel producer.

Asked when the the open offer would hit the market, Rao said that "JSW has 14 days time to announce the dates of open offer, which is also subject to SEBI approval".

On the other hand, the JSW scrips closed at Rs 1202.90 per piece, down 0.75 per cent.

Enam Securities , who is managing the open offer on behalf of Sajjan Jindal-led company, said in a public announcement that JSW Steel proposes to acquire 64.72 crore shares of Ispat, representing 20 per cent (at a face value of Rs 10 each) of the total shares at a price of Rs 20.54 per share in cash.

The Sajjan Jindal-led company had said on Tuesday that it will buy a 41.29 per cent stake in Ispat through a preferential issue of fresh shares, which will reduce the Ispat promoters' stake to 26 per cent.

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Posted in: BUSINESS NEWS

BSE Sensex seen higher; metals watched

The BSE Sensex is expected to climb on Monday, supported by robust foreign fund demand and firmer Asian peers.
Foreign funds have pumped more than USD 21 billion into Indian equities so far in 2010, driving the main stock index nearly 16% higher.

Metals producers such as Sterlite Industries will be in focus after base metal futures rallied in Shanghai buoyed by expectations of more stimulus from the US Federal Reserve.
NMDC will be on the radar after the Economic Times reported China's Sinochem has approached the Indian state-run miner for a joint bid to buy Canada's Potash Corp.
The chairman of NMDC denied any such plan, the paper said.
The MSCI's measure of Asian markets other than Japan was up 0.8% by 0303 GMT, while the Japanese market was closed for a holiday.
The Nifty India stock futures in Singapore were up 0.6%.
Last week the 30-share BSE index logged its first weekly loss in six, but the benchmark that closed at 20,250.26 is only around 1,000 points from a record high.

Stocks to watch
Fortis Healthcare after the hospital chain's controlling owners said they have agreed to buy the healthcare assets of Hong Kong-based Quality HealthCare Asia Ltd for HK$1.52 billion (USD 195 million).
Bharat Forge after the Mint reported the firm's joint venture with Paris-based Alstom SA had emerged as the lowest bidder for the largest order for supply of power generation equipment in India.
Procter & Gamble Hygiene Health Care Ltd after the personal care products maker said it would consider a stock split in its upcoming board meet.
Hindustan Motors Ltd after the company's board proposed to write off the securities premium account which was worth Rs 3.17 crore as of March 31.
State Bank of Travancore after the company said it would raise its base rate to 8 percent from 7.75% effective October 11.

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Posted in: BUSINESS NEWS

BSE Sensex seen higher; metals watched

The BSE Sensex is expected to climb on Monday, supported by robust foreign fund demand and firmer Asian peers.
Foreign funds have pumped more than USD 21 billion into Indian equities so far in 2010, driving the main stock index nearly 16% higher.

Metals producers such as Sterlite Industries will be in focus after base metal futures rallied in Shanghai buoyed by expectations of more stimulus from the US Federal Reserve.
NMDC will be on the radar after the Economic Times reported China's Sinochem has approached the Indian state-run miner for a joint bid to buy Canada's Potash Corp.
The chairman of NMDC denied any such plan, the paper said.
The MSCI's measure of Asian markets other than Japan was up 0.8% by 0303 GMT, while the Japanese market was closed for a holiday.
The Nifty India stock futures in Singapore were up 0.6%.
Last week the 30-share BSE index logged its first weekly loss in six, but the benchmark that closed at 20,250.26 is only around 1,000 points from a record high.

Stocks to watch
Fortis Healthcare after the hospital chain's controlling owners said they have agreed to buy the healthcare assets of Hong Kong-based Quality HealthCare Asia Ltd for HK$1.52 billion (USD 195 million).
Bharat Forge after the Mint reported the firm's joint venture with Paris-based Alstom SA had emerged as the lowest bidder for the largest order for supply of power generation equipment in India.
Procter & Gamble Hygiene Health Care Ltd after the personal care products maker said it would consider a stock split in its upcoming board meet.
Hindustan Motors Ltd after the company's board proposed to write off the securities premium account which was worth Rs 3.17 crore as of March 31.
State Bank of Travancore after the company said it would raise its base rate to 8 percent from 7.75% effective October 11.

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Posted in: BUSINESS NEWS

SBI raises deposit rates by 75 bps; base rate unchanged

MUMBAI: State Bank of India (SBI) has said that it will raise deposit rates by 25-75 basis points with effect from October 1, but the bank has kept the minimum rate of interest on loans unchanged at 7.5 per cent.
“The bank revises upwards the deposit rates by 25-75 bps in various maturities, effective October 1, 2010,” SBI said in a filing to the Bombay Stock Exchange.
The deposit rates of SBI are in the range of 4 per cent to 7.75 per cent. The bank said that it reviewed the base rate — the minimum lending rate below which bank cannot offer loans — at the existing level of 7.5 per cent. Thus, the base rate will contin ue to remain at 7.5 per cent per annum for the present.

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Posted in: BUSINESS NEWS,SBI

SBI raises deposit rates by 75 bps; base rate unchanged

MUMBAI: State Bank of India (SBI) has said that it will raise deposit rates by 25-75 basis points with effect from October 1, but the bank has kept the minimum rate of interest on loans unchanged at 7.5 per cent.
“The bank revises upwards the deposit rates by 25-75 bps in various maturities, effective October 1, 2010,” SBI said in a filing to the Bombay Stock Exchange.
The deposit rates of SBI are in the range of 4 per cent to 7.75 per cent. The bank said that it reviewed the base rate — the minimum lending rate below which bank cannot offer loans — at the existing level of 7.5 per cent. Thus, the base rate will contin ue to remain at 7.5 per cent per annum for the present.

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Posted in: BUSINESS NEWS,SBI

Indian millionaires zoom by 42,800

India added more than 42,800 US dollar millionaires last year, taking the total number in the country to more than 127,000 — and the phenomenon is only going to grow further as high economic growth is sustained.

What’s more, India, China and other Asia-Pacific regional economies are collectively set to outpace developed countries in spawning high net-worth individuals (HNIs), wealth manager Merrill Lynch and consulting firm Capgemini said in a report released on Tuesday.
“Moving forward, China and India will lead the way in the region with economic expansion and HNI growth likely to keep outpacing more developed economies” it said.
The Asia-Pacific Wealth Report 2010 noted that the total amount held in assets by Indian millionaires accounted for more than $477 billion last year, up 53.6 per cent on the year. That is R21.5 lakh crore.
“The increasing confidence by Indian HNIs facilitated by the strength of the underlying economy which grew 6.8 per cent in 2009 has resulted in a surge in HNI wealth in the region,” said Pradeep Dokania, chairman, Merrill Lynch, Wealth Management, India.
Asia-Pacific as a whole outpaced Europe in the amount of wealth on play as the invested/investible corpus totalled $9.7 trillion, compared with Europe’s $9.3 trillion, it added.
“Asia-Pacific’s HNI population matching Europe’s for the first time highlights the region’s growth potential, with China and India at the forefront and Japan remaining an important market,” said Dokania.
The share of real estate dropped in 2009, while fixed-income investments went up. Equities and cash assets remained stable.

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Posted in: BUSINESS NEWS,Moneycontrol

Indian millionaires zoom by 42,800

India added more than 42,800 US dollar millionaires last year, taking the total number in the country to more than 127,000 — and the phenomenon is only going to grow further as high economic growth is sustained.

What’s more, India, China and other Asia-Pacific regional economies are collectively set to outpace developed countries in spawning high net-worth individuals (HNIs), wealth manager Merrill Lynch and consulting firm Capgemini said in a report released on Tuesday.
“Moving forward, China and India will lead the way in the region with economic expansion and HNI growth likely to keep outpacing more developed economies” it said.
The Asia-Pacific Wealth Report 2010 noted that the total amount held in assets by Indian millionaires accounted for more than $477 billion last year, up 53.6 per cent on the year. That is R21.5 lakh crore.
“The increasing confidence by Indian HNIs facilitated by the strength of the underlying economy which grew 6.8 per cent in 2009 has resulted in a surge in HNI wealth in the region,” said Pradeep Dokania, chairman, Merrill Lynch, Wealth Management, India.
Asia-Pacific as a whole outpaced Europe in the amount of wealth on play as the invested/investible corpus totalled $9.7 trillion, compared with Europe’s $9.3 trillion, it added.
“Asia-Pacific’s HNI population matching Europe’s for the first time highlights the region’s growth potential, with China and India at the forefront and Japan remaining an important market,” said Dokania.
The share of real estate dropped in 2009, while fixed-income investments went up. Equities and cash assets remained stable.

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Posted in: BUSINESS NEWS,Moneycontrol

R-Power unveils investment plans of Rs 1.20 lakh crore

Bullish on India’s power sector, Anil Ambani Group company Reliance Power today unveiled its massive expansion plans entailing an investment of a whopping Rs 1,20,000 crore on thermal and hydro projects in the next seven years.

The company plans to pump about Rs 80,000 crore in coal—based power projects of 20,000 MW capacity in the next five years. Another Rs 30,000 crore would be invested to execute hydro power projects.

Reliance Power is also planning to set up gas—based projects in full steam and has plans to add 10,000 MW capacity in the future.

With this, the company’s total generation capacity from all sources of energy would touch 35,000 MW by 2017.

“Reliance Power will have operational capacity of 5,000 MW by 2012 and commission another 20,000 MW over the next three years (by 2015),” ADA Group Chairman Anil Ambani said, addressing the company’s Annual General Meeting here.

The cost of generating one megawatt of electricity from coal is about Rs 4 crore and for hydro is about Rs 6 crore, taking the total investment needed to Rs 1,20,000 crore.

The company has already raised funds to the tune of Rs 50,000 crore for financing its expansion plans.

The company operates two units (2x300 MW) of Rosa thermal power project (1,200 MW) at Shajanpur in Uttar Pradesh.

“Post Supreme Court judgement the development of 10,000 MW of gas—based generation has commenced,” Ambani said.

Construction of the 2,400 MW gas—based plant at Samalkot, Andhra Pradesh, has started and the project outlay is to the tune of Rs 10,000 crore.

Reliance Power has over 2 billion tonnes of domestic coal reserves that can support power generation to the tune of 20,000 MW capacity, Ambani said.

Three coal mines acquired by the company in Indonesia would support up to 10,000 MW electricity generation capacity.

In totality, the captive coal reserves in India and Indonesia are sufficient to support 30,000 MW of coal capacity for 25 years.

Reliance Power CEO J P Chalasani said that the company’s ultra mega power projects of 4,000 MW capacity each at Sasan (Madhya Pradesh) and Krishnapatnam (Andhra Pradesh) are on track.

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Posted in: BUSINESS NEWS,SPECIAL NEWS

R-Power unveils investment plans of Rs 1.20 lakh crore

Bullish on India’s power sector, Anil Ambani Group company Reliance Power today unveiled its massive expansion plans entailing an investment of a whopping Rs 1,20,000 crore on thermal and hydro projects in the next seven years.

The company plans to pump about Rs 80,000 crore in coal—based power projects of 20,000 MW capacity in the next five years. Another Rs 30,000 crore would be invested to execute hydro power projects.

Reliance Power is also planning to set up gas—based projects in full steam and has plans to add 10,000 MW capacity in the future.

With this, the company’s total generation capacity from all sources of energy would touch 35,000 MW by 2017.

“Reliance Power will have operational capacity of 5,000 MW by 2012 and commission another 20,000 MW over the next three years (by 2015),” ADA Group Chairman Anil Ambani said, addressing the company’s Annual General Meeting here.

The cost of generating one megawatt of electricity from coal is about Rs 4 crore and for hydro is about Rs 6 crore, taking the total investment needed to Rs 1,20,000 crore.

The company has already raised funds to the tune of Rs 50,000 crore for financing its expansion plans.

The company operates two units (2x300 MW) of Rosa thermal power project (1,200 MW) at Shajanpur in Uttar Pradesh.

“Post Supreme Court judgement the development of 10,000 MW of gas—based generation has commenced,” Ambani said.

Construction of the 2,400 MW gas—based plant at Samalkot, Andhra Pradesh, has started and the project outlay is to the tune of Rs 10,000 crore.

Reliance Power has over 2 billion tonnes of domestic coal reserves that can support power generation to the tune of 20,000 MW capacity, Ambani said.

Three coal mines acquired by the company in Indonesia would support up to 10,000 MW electricity generation capacity.

In totality, the captive coal reserves in India and Indonesia are sufficient to support 30,000 MW of coal capacity for 25 years.

Reliance Power CEO J P Chalasani said that the company’s ultra mega power projects of 4,000 MW capacity each at Sasan (Madhya Pradesh) and Krishnapatnam (Andhra Pradesh) are on track.

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Posted in: BUSINESS NEWS,SPECIAL NEWS

Assets under wealth management div to cross Rs 1,000 cr: SBI

State Bank of India (SBI), which forayed into wealth management services earlier this year, aims to bring assets over Rs 1,000 crore under management by March, 2011.

Financial Planning and Advisory Services, the wealth management division of the bank launched this year, is now available in 924 branches through Relationship Managers, a senior SBI official told PTI.

Asset Under Management (AUM) was at Rs 104 crore at the end of June 2010, and is expected to cross Rs 1,000 crore by the end of the current fiscal, the official said.
    
The wealth management division guides customers on meeting their financial goals through a suite of products, including mutual funds, fixed deposits and insurance, the official added.
    
Country's largest lender SBI is aiming at 20 per cent growth this fiscal in net profit, which was at Rs 9,166.05 crore last financial year.
    
"Quarter one was 25 per cent. We can do 20 per cent (this fiscal). That is what we would try to achieve...We will try to maintain this growth as far as possible," SBI Chairman O P Bhatt had said.
    
The bank had reported an over 25 per cent growth in net profit to Rs 2,914.20 crore for the first quarter ended June 2010, despite an increase in bad debts.
    
The rise in net profit was mainly due to a three-year high net interest income and a decline in the cost of deposits and savings.
    
Net interest income rose by 45.35 per cent during Q1, compared to the same quarter a year ago. Growth in net income was 4.30 per cent in June, 2009.
    
In addition, SBI's operating profit zoomed by 66.97 per cent in the first quarter. It had declined 7.28 per cent in the corresponding quarter of the previous year.

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Posted in: BUSINESS NEWS

Assets under wealth management div to cross Rs 1,000 cr: SBI

State Bank of India (SBI), which forayed into wealth management services earlier this year, aims to bring assets over Rs 1,000 crore under management by March, 2011.

Financial Planning and Advisory Services, the wealth management division of the bank launched this year, is now available in 924 branches through Relationship Managers, a senior SBI official told PTI.

Asset Under Management (AUM) was at Rs 104 crore at the end of June 2010, and is expected to cross Rs 1,000 crore by the end of the current fiscal, the official said.
    
The wealth management division guides customers on meeting their financial goals through a suite of products, including mutual funds, fixed deposits and insurance, the official added.
    
Country's largest lender SBI is aiming at 20 per cent growth this fiscal in net profit, which was at Rs 9,166.05 crore last financial year.
    
"Quarter one was 25 per cent. We can do 20 per cent (this fiscal). That is what we would try to achieve...We will try to maintain this growth as far as possible," SBI Chairman O P Bhatt had said.
    
The bank had reported an over 25 per cent growth in net profit to Rs 2,914.20 crore for the first quarter ended June 2010, despite an increase in bad debts.
    
The rise in net profit was mainly due to a three-year high net interest income and a decline in the cost of deposits and savings.
    
Net interest income rose by 45.35 per cent during Q1, compared to the same quarter a year ago. Growth in net income was 4.30 per cent in June, 2009.
    
In addition, SBI's operating profit zoomed by 66.97 per cent in the first quarter. It had declined 7.28 per cent in the corresponding quarter of the previous year.

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Posted in: BUSINESS NEWS

Food inflation dips to 8-month low of 12.92%

New Delhi: Annual food inflation in India dropped sharply to 12.92%, an eight-month low, in the third week of June from 16.9% in the previous week on the back of a high base effect. But, with the week-on-week inflation figures showing marginal uptick of 0.3%, markets and economists expect the central bank to go for a sharp hike in the key policy rates on or before the quarterly monetary policy review that falls on July 28. The yield on government bonds across all maturities closed lower on expectation of hike in the key policy rates.

“The pace of rise in food prices is showing some signs of easing on the back of expectations of a good monsoon. However, if the prices do not drop from the current levels and core inflation eases, there is a possibility of classic wage price upward spiral scenario playing out,” country’s chief statistician Pronab Sen told FE.

On back of a high base effect, the annual inflation in potato prices showed a drop of 40% while price of onion fell by 7% in the week ended June 19. Cereals, vegetables and fruits showed single digit inflation while pulses showed a 31% annual increase in prices.

“Provided the monsoon is good, we are expecting the food price inflation to come down to 5%-6% by the December,” Plan panel member Abhijit sen had told FE in an earlier interview.” The prices of dairy products, which is showing no signs of easing so far, will also move down as a good monsoon brings down fodder costs,” Abhijit Sen had said. The price of milk showed an annual inflation of 15% in the week under consideration.

Although the Met department is projecting above-normal rains in the current year, according to the latest official data there was a 16% deficit in the monsoon rains in month of June. Last year, the worst monsoon rains in more than 30 years had pushed annual food price inflation to a high of 21%. Annual inflation for fuel items dropped to 12.9% from 13.18% in the previous week. But the annual inflation for fuel items will be showing a sharp spike in coming weeks as last week the government has hiked the prices of petrol, diesel, kerosene and cooking gas.

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Posted in: BUSINESS NEWS

Food inflation dips to 8-month low of 12.92%

New Delhi: Annual food inflation in India dropped sharply to 12.92%, an eight-month low, in the third week of June from 16.9% in the previous week on the back of a high base effect. But, with the week-on-week inflation figures showing marginal uptick of 0.3%, markets and economists expect the central bank to go for a sharp hike in the key policy rates on or before the quarterly monetary policy review that falls on July 28. The yield on government bonds across all maturities closed lower on expectation of hike in the key policy rates.

“The pace of rise in food prices is showing some signs of easing on the back of expectations of a good monsoon. However, if the prices do not drop from the current levels and core inflation eases, there is a possibility of classic wage price upward spiral scenario playing out,” country’s chief statistician Pronab Sen told FE.

On back of a high base effect, the annual inflation in potato prices showed a drop of 40% while price of onion fell by 7% in the week ended June 19. Cereals, vegetables and fruits showed single digit inflation while pulses showed a 31% annual increase in prices.

“Provided the monsoon is good, we are expecting the food price inflation to come down to 5%-6% by the December,” Plan panel member Abhijit sen had told FE in an earlier interview.” The prices of dairy products, which is showing no signs of easing so far, will also move down as a good monsoon brings down fodder costs,” Abhijit Sen had said. The price of milk showed an annual inflation of 15% in the week under consideration.

Although the Met department is projecting above-normal rains in the current year, according to the latest official data there was a 16% deficit in the monsoon rains in month of June. Last year, the worst monsoon rains in more than 30 years had pushed annual food price inflation to a high of 21%. Annual inflation for fuel items dropped to 12.9% from 13.18% in the previous week. But the annual inflation for fuel items will be showing a sharp spike in coming weeks as last week the government has hiked the prices of petrol, diesel, kerosene and cooking gas.

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Posted in: BUSINESS NEWS

BK Birla's daughter to be Kesoram vice-chairman

A change is in the wings, though perhaps not right now, for Basant Kumar Birla's Kesoram Industries . Birla, who is 90 and the chairman, says his daughter, Manjushree Khaitan, will manage Kesoram, but under his grandson, Kumar Mangalam Birla.

"Manjushree will look after the company and will be in constant touch with Kumar Mangalam Birla. I would want Kumar Mangalam to be the chairman of the company; Manjushree can be the vice-chairman," said Birla, on the sidelines of the Kesoram annual general meeting.

Last year, a shareholder suggested Khaitan be made vice-chairman. While Birla said he would consider, he was clear that Kumar Mangalam would inherit the company.

"All my companies will go to Kumar Mangalam, but my daughters will get a part of it," he said, when asked whether there was any change in the succession plan. Birla does not plan to retire at present. Though Birla did not make clear today if his statements meant another change in the inheritance of Kesoram, it was a departure from earlier indications. His statements today cleared the position regarding his views on Khaitan's role.

And, she addressed the shareholders for the first time and outlined a vision for the company, the most aggressive road map in recent times. "Kesoram would go beyond Rs 10,000 crore," she said while emphasising the need for a strategic long-term view.

Kesoram ended 2010 with a turnover in excess of Rs 5,000 crore. The board today approved an expansion plan entailing an investment of Rs 1,125 crore.

Birla's will, made in July 2004, said each company of his would be inherited by the person who was in charge of it and overseeing its day-to-day affairs. Under the formula, Manjushree Khaitan and the other daughter, Jayshree Mohta, were to get Kesoram Industries and Jay Shree Tea & Industries, respectively.

However, he later changed it, and said all the major companies Century Textiles, Century Enka and Kesoram Industries would go to Kumar Mangalam Birla.

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Posted in: BUSINESS NEWS

BK Birla's daughter to be Kesoram vice-chairman

A change is in the wings, though perhaps not right now, for Basant Kumar Birla's Kesoram Industries . Birla, who is 90 and the chairman, says his daughter, Manjushree Khaitan, will manage Kesoram, but under his grandson, Kumar Mangalam Birla.

"Manjushree will look after the company and will be in constant touch with Kumar Mangalam Birla. I would want Kumar Mangalam to be the chairman of the company; Manjushree can be the vice-chairman," said Birla, on the sidelines of the Kesoram annual general meeting.

Last year, a shareholder suggested Khaitan be made vice-chairman. While Birla said he would consider, he was clear that Kumar Mangalam would inherit the company.

"All my companies will go to Kumar Mangalam, but my daughters will get a part of it," he said, when asked whether there was any change in the succession plan. Birla does not plan to retire at present. Though Birla did not make clear today if his statements meant another change in the inheritance of Kesoram, it was a departure from earlier indications. His statements today cleared the position regarding his views on Khaitan's role.

And, she addressed the shareholders for the first time and outlined a vision for the company, the most aggressive road map in recent times. "Kesoram would go beyond Rs 10,000 crore," she said while emphasising the need for a strategic long-term view.

Kesoram ended 2010 with a turnover in excess of Rs 5,000 crore. The board today approved an expansion plan entailing an investment of Rs 1,125 crore.

Birla's will, made in July 2004, said each company of his would be inherited by the person who was in charge of it and overseeing its day-to-day affairs. Under the formula, Manjushree Khaitan and the other daughter, Jayshree Mohta, were to get Kesoram Industries and Jay Shree Tea & Industries, respectively.

However, he later changed it, and said all the major companies Century Textiles, Century Enka and Kesoram Industries would go to Kumar Mangalam Birla.

Read more »

Posted in: BUSINESS NEWS

Split CFTC approves box-office futures

WASHINGTON — Federal regulators on Monday allowed a new online exchange to proceed to trade future box-office receipts for movies.

A divided Commodity Futures Trading Commission approved the proposed futures contracts for the new Trend Exchange. That means the movie futures trading can proceed; it is expected to begin sometime in the third quarter.

Major Hollywood studios strongly oppose the idea. They say rival studios could sabotage films by betting against them.

In giving its approval, the CFTC said it found that box-office receipts fit the law's definition of a commodity, that the Trend Exchange contracts aren't "readily susceptible" to manipulation, and they provide a way of managing risk.

The agency's vote was 3-2. Two CFTC commissioners, Democrat Bart Chilton and Republican Jill Sommers, voted against approving the contracts for the Trend Exchange.

"Popcorn prediction markets would serve no national public interest" and don't meet the law's requirements on how commodities are defined, Chilton said in a statement.

Chilton said he also was troubled by whether the new futures trading would provide a legitimate way for the movie industry to hedge against risk, since the agency's approval limits the use of the new contracts by movie studios.

Allowing future box-office receipts to be traded like crude oil or pork bellies would give people who finance movies a way to make money even when a film doesn't. It also could be used for speculation.

The first proposed contract for the Trend Exchange is for opening-weekend receipts for "Takers," being released Aug. 20, with Matt Dillon.

"We are pleased that the staff of the CFTC and a majority of the commissioners recognized the legitimate economic risk-management benefits that these products will provide to the entertainment industry," Robert Swagger, CEO of the Trend Exchange, said in a statement.

Trading would be based on the amount of money a movie takes in during its opening weekend. The exchange would set the initial odds for contracts, but those odds would change based on bidding of investors. An investor who buys a contract with longer odds takes on greater risk and the potential to earn more money.

For example, an investor thinks a movie will make at least $75 million in its first weekend. The exchange finds an investor who thinks the movie will fall short of that mark and the two investors enter the contract together. When the movie receipts come in, the one who is correct gets a percentage on top of his investment based on the odds received. The other loses his investment.

The CFTC previously approved the establishment of the Trend Exchange and the Cantor Futures Exchange. The proposed futures contracts, establishing rules for trading, have now gained the agency's approval for the Trend Exchange. For the Cantor exchange, the deadline for approving the contracts is June 28.

Supporters, led by investor groups that put up the money to make films, say the concept would help generate new capital for the movie industry. A tougher economy has made it harder to finance films and trading futures on box-office receipts would help offset risk.

Opponents, led by big Hollywood studios, warn that complex trading brought down the housing market and this idea could do the same to the movie industry.

In Congress, the Senate version of the financial regulatory overhaul would ban futures trading on movie revenues. It's unclear if that ban will survive House-Senate negotiations on the final legislation.

The studios' lobbying group, the Motion Picture Association of America, urged Congress Monday to put the ban in the final bill that will be signed by President Barack Obama.

"It is unfortunate that the CFTC has now given the go-ahead to a new gambling platform that could be plagued by financial irregularities and manipulation," MPAA President and interim CEO Robert Pisano said in a statement. The new box-office contracts "pose real possible economic damage to an industry that employs over 2.4 million men and women working in virtually every state in the country," he said.

Also opposed are the National Association of Theatre Owners, the Directors Guild of America, and the Independent Film and Television Alliance.

Swagger said his exchange "regrets that a special-interest group of Hollywood industry insiders chose to politicize the issue (and) we will fight attempts by this group to overturn the CFTC outcome in Congress."

from The Associated Press.

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Posted in: BUSINESS NEWS

Split CFTC approves box-office futures

WASHINGTON — Federal regulators on Monday allowed a new online exchange to proceed to trade future box-office receipts for movies.

A divided Commodity Futures Trading Commission approved the proposed futures contracts for the new Trend Exchange. That means the movie futures trading can proceed; it is expected to begin sometime in the third quarter.

Major Hollywood studios strongly oppose the idea. They say rival studios could sabotage films by betting against them.

In giving its approval, the CFTC said it found that box-office receipts fit the law's definition of a commodity, that the Trend Exchange contracts aren't "readily susceptible" to manipulation, and they provide a way of managing risk.

The agency's vote was 3-2. Two CFTC commissioners, Democrat Bart Chilton and Republican Jill Sommers, voted against approving the contracts for the Trend Exchange.

"Popcorn prediction markets would serve no national public interest" and don't meet the law's requirements on how commodities are defined, Chilton said in a statement.

Chilton said he also was troubled by whether the new futures trading would provide a legitimate way for the movie industry to hedge against risk, since the agency's approval limits the use of the new contracts by movie studios.

Allowing future box-office receipts to be traded like crude oil or pork bellies would give people who finance movies a way to make money even when a film doesn't. It also could be used for speculation.

The first proposed contract for the Trend Exchange is for opening-weekend receipts for "Takers," being released Aug. 20, with Matt Dillon.

"We are pleased that the staff of the CFTC and a majority of the commissioners recognized the legitimate economic risk-management benefits that these products will provide to the entertainment industry," Robert Swagger, CEO of the Trend Exchange, said in a statement.

Trading would be based on the amount of money a movie takes in during its opening weekend. The exchange would set the initial odds for contracts, but those odds would change based on bidding of investors. An investor who buys a contract with longer odds takes on greater risk and the potential to earn more money.

For example, an investor thinks a movie will make at least $75 million in its first weekend. The exchange finds an investor who thinks the movie will fall short of that mark and the two investors enter the contract together. When the movie receipts come in, the one who is correct gets a percentage on top of his investment based on the odds received. The other loses his investment.

The CFTC previously approved the establishment of the Trend Exchange and the Cantor Futures Exchange. The proposed futures contracts, establishing rules for trading, have now gained the agency's approval for the Trend Exchange. For the Cantor exchange, the deadline for approving the contracts is June 28.

Supporters, led by investor groups that put up the money to make films, say the concept would help generate new capital for the movie industry. A tougher economy has made it harder to finance films and trading futures on box-office receipts would help offset risk.

Opponents, led by big Hollywood studios, warn that complex trading brought down the housing market and this idea could do the same to the movie industry.

In Congress, the Senate version of the financial regulatory overhaul would ban futures trading on movie revenues. It's unclear if that ban will survive House-Senate negotiations on the final legislation.

The studios' lobbying group, the Motion Picture Association of America, urged Congress Monday to put the ban in the final bill that will be signed by President Barack Obama.

"It is unfortunate that the CFTC has now given the go-ahead to a new gambling platform that could be plagued by financial irregularities and manipulation," MPAA President and interim CEO Robert Pisano said in a statement. The new box-office contracts "pose real possible economic damage to an industry that employs over 2.4 million men and women working in virtually every state in the country," he said.

Also opposed are the National Association of Theatre Owners, the Directors Guild of America, and the Independent Film and Television Alliance.

Swagger said his exchange "regrets that a special-interest group of Hollywood industry insiders chose to politicize the issue (and) we will fight attempts by this group to overturn the CFTC outcome in Congress."

from The Associated Press.

Read more »

Posted in: BUSINESS NEWS