Corporate Sector News

[ejazr]

Kingdom Holding, Tata mull joint investments

RIYADH: Kingdom Holding, headed by Prince Alwaleed bin Talal, and Indian conglomerate Tata Group are examining unspecified joint investment opportunities, the Saudi firm said on Tuesday.

Kingdom Holding, one of the largest shareholders in Citigroup, said Tata Group’s Chairman Ratan N. Tata, has held a meeting with Prince Alwaleed in Riyadh.

“Mr. Tata said his visit was exploratory in order to find potential investment opportunities between Kingdom Holding and Tata Group. The two also exchanged general strategic ideas related to various areas of investment,” it said.

Tata Group presented “a number of potential investment projects” which will be examined further by the two parties, it added, without giving further details.

 

[NSG_Blackcats]

Bajaj posts record profit, sales in Q2​

Pune, Oct. 15 Bajaj Auto has just had its best quarter ever in its history with net profit up 118 per cent to Rs 402.83 crore from Rs 184.91 crore in the same period last year.

The total income was up 15 per cent to Rs 2,887.51 crore from Rs 2,519.18 crore in the second-quarter ended September 30. The operating earnings before interest, taxes, depreciation, amortisation margin were the highest ever thus far at 22 per cent against 13.6 per cent last year and surpassing the previous record of 19.5 per cent in the preceding quarter.

Exports during the period were again the best ever in a quarter with 2,24,334 vehicles translating into revenue of Rs 799 crore. In contrast, the same period of last fiscal had seen 2,06,930 vehicles exported yielding Rs 714 crore. Bajaj expects to top its annual target of 8 lakh units set for this fiscal.

Full Story

 

[Pintu]

UltraTech net up 53% to Rs 251 crore- Earnings-News By Company-News-The Economic Times

UltraTech net up 53% to Rs 251 crore
17 Oct 2009, 0020 hrs IST, ET Bureau

MUMBAI: UltraTech Cement, which is poised to emerge as the country’s largest company after merger of Grasim’s cement business with itself, on Friday announced a better-than-expected quarterly results with a 53% rise in net profit at Rs 251 crore due to higher sales and lower costs.

For the September quarter, the company’s net sales grew 10% to Rs 1,540 crore, while company’s power and fuel expenditure went down 20% to Rs 316 crore. Volume growth during the quarter was 12%. On outlook, the Aditya Birla group company expects industry demand to grow at 9% in FY10 given the government’s initiatives to boost rural development, infrastructure and housing.

The company’s focus on higher volume growth, captive power generation and capital productivity should offset the negative impact on margins arising out of surplus capacity, said KC Birla, senior executive president and CFO, UltraTech Cement.

EBITDA margin for the September quarter stood at 33%, as against 26% in a year-ago period. But the margins were 38% in the June quarter this year. On this Mr Birla told ET NOW, this paper’s news channel, that there might not be any pressure on margin except for the southern market, which was hit by the excess capacity and which contributed 29% to the company’s sales.

“Even then, we are improving on our operating efficiencies. We have commissioned the power plant and we have some logistic advantages. All these factors will help us to maintain our operating margin,” he added.

Talking on the pricing pressure the cement industry witnessed in the September quarter, Mr Birla said: “Traditionally, Q2 sees price reduction because of the rainy season. But, the industry is growing at 12%, compared to last year’s 9%. If this momentum is maintained, the price pressure will be neutralised.” Cement production of the company was higher by 12% to 3.73 million tonnes in the quarter ended September.

Post merger, UltraTech’s capacity will go up to 49 million tonne. The merger is expected to be over in next few months. Mr Birla said UltraTech, post merger of Grasim’s cement business with itself, would likely to be re-rated. The per tonne valuation of UltraTech is around $112, compared to ACC’s $145 and Ambuja Cement’s $146. The UltraTech stock slipped 2.4% to close at Rs 824.75 on BSE.

 

[Pintu]

TCS net soars on financial sector revival- Earnings-News By Company-News-The Economic Times

TCS net soars on financial sector revival
17 Oct 2009, 0312 hrs IST, ET Bureau

MUMBAI: Tata Consultancy Services bettered expectations to post a 29% jump in net profits for the second quarter as elusive clients returned to its mainstay financial services vertical, triggering hopes of a return to pre-slowdown glory in the industry that had close rival Infosys beating market forecasts last week.

CEO N Chandrasekaran, who took charge of India’s largest technology firm early this month, said the large deal closure this quarter has been very good, across industries and regions such as US, India and Europe, including UK. “We are pursuing more than 20-25 large deals currently,” he said, but the company warned the situation was nowhere near the pre-slowdown days.

Net profit that was up 29% over the previous year stood at Rs 1,642 crore as business picked up and more work moved to cost-effective offshore locations. Revenues rose 7% to Rs 7,435 crore because of the uptick in contracts from its customers in the key financial services segment as well in industries such as retail, government and utilities.

The results came after the markets closed on Friday, but the company scrip went up 2.8% on the BSE at Rs 599.

The company also announced a 150% variable pay payout for its employees. Reflecting the turnaround in the demand environment, the company intends to take on board 8,000 freshers that it already made prior offers to.

“It was a fantastic second quarter on top of very good first quarter. The financial services sector has given them significant growth and they had enough employees to address the demand,” said an IT analyst with a domestic brokerage.

“TCS results, in almost all parameters, make this a blow-out quarter for the company. The most interesting thing in TCS numbers is that banking
and financial services, which forms 45% of TCS revenues has grown the fastest at 8.7%QQ," said brokerage CLSA.

TCS said stability had returned to financial services sector, which was rocked by the collapse some of the biggest global names a year ago. However, it struck a note of caution for the manufacturing, high-tech and telecom sectors. "We would like to watch these very very carefully... Business from our largest telecom customer continues to be under strain. But my feeling is that it has bottomed out," said Mr Chandrasekaran.

Cross currency fluctuations continued to pose a challenge and the company had a forex loss of Rs 113 crore during the quarter under review. TCS CFO S Mahalingam said all the company's recievables were hedged and it would try to defend a rate of Rs 46 against the dollar, the average rupee-dollar rate last year.

The overall sentiment of optimism tempered with caution was also reflected by the Ajoy Mukherjee, Global Head (HR). While the company gave 150% payout in variable pay and hired 5530 people during the quarter, Mr Mukherjee said there was no plan to hike wages across the company. He said the company would firm up the numbers for campus hiring only in November.

 

[Pintu]

Voith in talks with Tatas for JV, to expand India ops- Engineering-Ind'l Goods / Svs-News By Industry-News-The Economic Times

Voith in talks with Tatas for JV, to expand India ops
19 Oct 2009, 0232 hrs IST, Sanjeev Choudhary, ET Bureau

GERMANY: Voith, the e5-billion German manufacturer of paper machines, hydropower equipment and diesel locomotives, is in talks with the Tata group to form a joint venture company intended to manufacture diesel engine in India for the German group’s locomotives.

The company is looking at expanding in India by tie-ups or by acquiring local manufacturers in certain industrial equipment segments and enhance its R&D capabilities.

“We want to have a second source for our diesel engines for our locomotives. Tatas can be a good partner as they have experience in making diesel engines for their commercial vehicles,” said Hinrich Krey, the managing director of Voith Turbo, which manufactures locomotives at Kiel in Germany and currently sources diesel engine from a manufacturer in Turkey. He said the next round of talks with the Tata group is slated for later this year and if the negotiations succeed, the two companies will form a joint venture next year with the Indian group holding the majority stake.

India’s largest automobile manufacturer Tata Motors has a 50:50 joint venture with Cummins Engine Company of the USA to manufacture diesel engines at Jamshedpur for Indian company’s commercial vehicles.

Voith, the 142-year old company held by the Voith family, is also in talks with the Tata group to manufacture hydrodynamic retarders, used to slow down high-speed vehicles, in India, Voith AG president and CEO Hubert Lienhard said.

Another Voith official said the company was working on a new design for retarders that will cost at least 35% less than the usual price. He said this is line with the development of equipment for Tata’s Nano car project, and if the German company is able to achieve the low-cost target set by the Tata group, the two companies will be able to manufacture retarders jointly in India.

Heidenheim, Germany-based Voith, which claims its equipment is used to manufacture around one-third of the world’s paper and generate 30% of the world’s total hydro-electric energy, has long served Indian paper and hydropower companies.

It has a paper machine manufacturing facility in West Bengal, industrial equipment making facility in Hyderabad, and a soon-to-be commissioned turbine wheel making facility in Baroda. The company now wants to go big on India. “India is not big enough for us. We want to change that,” said Mr Lienhard.

Voith, which boasts of 11,000 active patents and files on average 400 patents annually, plans to increase its R&D capability in India. Its one-and-a-half years old R&D facility in Noida that has over a hundred staff will be its main research centre for its global small hydro business.

The company is also in the process of tying up with IIT Roorkee to rope in students and faculty for hydropower project research and also to regularly hire talent from campus.

 

[NSG_Blackcats]

Govt to sell stake in NTPC, more PSUs on the block​

New Delhi: Continuing with the its agenda of PSU divestment, CCEA on Monday, gave a green signal to divest a further 5 percent stake in the profit-making public sector undertaking National Thermal Power Corporation (NTPC) and said more PSUs will follow.

The process will be done through a follow on offer, Anand Sharma, the Union Minister for Commerce and Industry said here on Monday. The 5 percent stake sale by government is likely to raise Rs 8,000 cr and the follow on offer of NTPC is will be executed through an auction.

After NTPC’s follow on offer govt will hold 84.5 percent stake in the PSU. NTPC’s market capitalisation currently stands at Rs 1,72,000 cr.

Full Story

 

[Pintu]

Rel Cap, Daiwa to set up i-banking in India- Banking-Banking/Finance -News By Industry-News-The Economic Times

Rel Cap, Daiwa to set up i-banking in India
20 Oct 2009, 0252 hrs IST, Chaitali Chakravarty & Arun Kumar, ET Bureau

NEW DELHI: Anil Ambani-controlled Reliance Capital, through its subsidiary Reliance Securities, is entering into a strategic alliance with Japan’s second-largest investment bank Daiwa Securities to set up investment banking business in India.

The deal will enable the two firms to share clients in their domestic markets. With Daiwa, Reliance Capital will be able to tap Japan’s pool of high net worth individuals who want a slice of the India story, said an official involved in the deal requesting anonymity as he is not authorised to speak to the media. A Reliance Capital spokesman declined to comment for this story.

“Indian companies that are in the midst of expansion are looking at global capital. Japan, probably, has the largest pool of high net worth individuals looking to invest outside their country. This alliance will marry these two requirements,” he said.

The two companies are in advanced stages of negotiations to finalise the contours of the deal, two other officials involved in the negotiations said.

Indian companies are on a fund-raising spree, tapping QIPs, initial public offers or overseas issues of convertible instruments and equity issues. In the first six months of the current fiscal, Indian companies have raised $9 billion and plan to raise another $15 billion in the next six months.

Potential IPOs would help provide investment avenues to Japanese investors, said a leading foreign banker.

Reliance Money, a wholly-owned subsidiary of Reliance Capital, received a merchant banking licence from Sebi last September. Reliance Capital has interests in asset management, life and general insurance, private equity and proprietary investments, stock broking, depository services, distribution of financial products and consumer finance.

Daiwa Securities, a joint venture in which 40% stake is owned by Sumitomo Mitsui Financial Group, offers investment banking services, mostly to domestic companies and Japan-based multinationals.

Daiwa has advised some Indian institutions such as the Indian Railways Finance Corporation (IRFC) and EXIM Bank to raise debt of around 50 billion yen since March 2005 from the Japanese market.

Anil Ambani, promoter and chairman of Reliance-ADAG, had said at the last AGM of Reliance Capital: “Given the scale and magnitude of our relationships across corporate India and the sheer size and reach of our distribution network, we’re ideally positioned to create a significant presence in this (investment banking) business.”

 

[Pintu]

ITC Q2 net up 26 pc at Rs 1,009.91 cr- Stocks in News-Stocks-Markets-The Economic Times

ITC Q2 net up 26 pc at Rs 1,009.91 cr
23 Oct 2009, 1556 hrs IST, PTI

Mumbai: Diversified conglomerate ITC Ltd today reported a 25.81 per cent growth in net profit at Rs 1,009.91 crore for the second quarter ended September 30.

The company had a net profit of Rs 802.72 crore in the September quarter last fiscal, ITC said in a filing to the Bombay Stock Exchange.

Total income rose to Rs 4,413.72 crore during the July- September quarter of the current fiscal from Rs 3,973.12 crore in the corresponding period last fiscal.

"The reduction in corporate travel, both domestic and international, continued to impact the hotels business. De- growth in occupancies and average room rates persisted during the quarter," the company said.

During the September quarter ITC's net revenue from hotel business declined 24 per cent to Rs 174.04 crore.

The company said it expects the hotel business to gain pace in the second half of the current fiscal on the back of improvement in occupancies.

ITC's net revenue from FMCG business grew 19 per cent to Rs 3,063.02 crore and the agri-business revenue stood at Rs 1,028.28 crore-- also up 19 per cent over the year-ago period.

Shares of ITC were trading at Rs 257.20, up 3.90 per cent over previous close on the BSE.

 

[Pintu]

Indian Bank Q2 net up 31.47 pc to Rs 371.98 cr- Stocks in News-Stocks-Markets-The Economic Times

Indian Bank Q2 net up 31.47 pc to Rs 371.98 cr
23 Oct 2009, 1316 hrs IST, PTI

MUMBAI: Indian Bank today said its net profit rose by 31.47 per cent to Rs 371.98 crore for the second quarter ended September 30, 2009.

Total income rose to Rs 2,174.37 crore in the latest quarter from Rs 1,900.93 crore in the same quarter previous fiscal, Indian Bank said in a filing to the Bombay Stock Exchange.

Shares of Indian Bank were trading at Rs 183 on BSE, up 2.87 per cent from its previous close.

 

[Pintu]

Dr Reddy's Q2 net zooms 107% at Rs 106 cr

Dr Reddy's Q2 net zooms 107% at Rs 106 cr
BS Reporter / Mumbai October 23, 2009, 14:41 IST

City-based pharmaceutical major, Dr Reddy's Laboratories, reported a 106.55 per cent growth in its net profit to Rs 217.3 crore for the second quarter ended September 2009, as compared with Rs 105.2 crore in the corresponding quarter a year ago.

Revenues (including forex gain of Rs 24 crore) during the quarter touched Rs 1,836.8 crore, as against Rs 1,615.1 crore (forex loss Rs 29.6 crore) during the same period last year, reflecting an increase of 13.72 per cent.

The company witnesed a fall of 21 per cent in its revenues from Germany during the second quarter of FY10 to Rs 220 crore, from Rs 280 crore in Q2 FY09. This decrease is on account of the lower sales due to the AOK tender and the pricing pressure in the market.

"Pursuant to the ongoing reforms in the German generics pharmaceutical market, further tenders were announced by several of the public health insurance companies during the period. The company has participated or intended to participate in these tenders through its wholly-owned subsidiary betapharm. The final results of a majority of these tenders are yet to be announced. The results of these tenders may impact betapharm's business," the company said in a press release on Friday.

Revenues from Rest of Europe, however, grew 29 per cent to Rs 65.4 crore in Q2 FY10. The growth is largely contributed by UK with sales of Rs 43.6 crore, while revenues in India stood at Rs 250 crore, from Rs 220 crore in Q2 FY09, representing a growth of 13 per cent led by key brands like Omez, Omez-DSR and Razo, the release added.

Dr Reddy's scrip is currently trading at Rs 952 on the BSE, up 5.30 per cent as against the previous close of Rs 904.10.

 

[NSG_Blackcats]

Maruti's Sept qtr net profit rises 93 pct

India's top carmaker Maruti Suzuki on Saturday reported a 93 percent rise in quarterly net profit, boosted by buying in India's August to October festival season and meeting analysts' forecasts.

Maruti, in which Japan's Suzuki Motor Corp holds a 54.2 percent stake, said net profit rose to 5.7 billion rupees ($122.55 million) from 2.96 billion rupees a year earlier. Net sales in the quarter rose to 70.5 billion rupees from 48.06 billion rupees in the same quarter a year ago.

 

[Pintu]

Maruti to launch Alto, Wagon R with new generation engine- Automobiles-Auto-News By Industry-News-The Economic Times

Maruti to launch Alto, Wagon R with new generation engine
25 Oct 2009, 1735 hrs IST, PTI

NEW DELHI: The country's largest car maker Maruti Suzuki will launch two of its best selling models -- Alto and Wagon R, with a new generation engine as it prepares to meet April 2010 deadline of stricter emission norm.

According to industry sources, the company will discontinue the old F-series engines in both Alto and Wagon R and replace them with its new K-series engine, which is Bharat Stage IV complaint.

When contacted a Maruti Suzuki India (MSI) spokesperson said, "the successful K series engines will be mounted on more models in a phased manner," without specifying details and timeline for the change in engines.

Alto is MSI's best selling model. In November last year it crossed one-million mark in domestic market, while Wagon R also accounted for a good number to its compact car sales.

The company's newer models such A-Star, Ritz and the new Estilo are powered by K-series engines, which the company claims are more fuel efficient and have lesser emission.

With 11 cities in India scheduled to move to stricter Bharat Stage (BS) IV emission norms from the current BS III by April next year, MSI has been preparing itself for the change.

It has already upgraded its mid-sized sedan SX4 to make it BS IV compatible and it will be shortly launched in the market. A similar upgradation for premium compact car Swift and entry-level sedan DZire is also on the cards but the company has decided not to upgrade its oldest model M800 to meet the new emission norms.

 

[Pintu]

Techtree.com India > News > Consumer Electronics > Intex's New Affordable Mobile Phones

Intex's New Mobile Phones

Techtree News Staff, Oct 22, 2009 1350 hrs IST
All priced below Rs. 5,000

Intex has announced four new dual SIM mobile handsets for the Indian market.

The new models, IN4495 and IN4410, support simultaneous two GSM SIM while IN80 and IN20 support one GSM and one CDMA SIM.

The 4495 model features a 6.1 cm QVCA touch screen, Peer Control feature which needs a simple code with which a user can switch off the phone and perform other functions while at a distant location from the phone.

Other features include Motion Sensor, expandable memory up to 8 GB, camera, FM radio, audio and video player, Bluetooth, USB PC connectivity, and auto voice reply. It is available in white and green and black and plum color combinations and is priced at Rs. 4,200.

The INTEX IN 4410 model is priced at Rs. 3,400 and offers 2.0 inch TFT display, VGA camera, wireless FM radio without external antenna, video and audio player and inbuilt memory of 63MB.

The INTEX IN 80 has a big 6.1 cm display with QVGA resolution, up to 153.6 Kbps data download rate, expandable memory up to 2 GB, FM radio, camera, USB PC connectivity, Motion Sensor, Bluetooth, 3.8 mm stereo jack, audio and video player, talk time of 7 hours and standby of 260 hours. It is priced at Rs. 5,000.

The INTEX IN20 is positioned as a musical phone with FM radio, 1.5 CSTN display, a three-hours talk time, 150 hours stand by, one-way call record mobile tracker, phonebook with 500 contacts phonebook memory, sound recorder, etc. It is priced at Rs. 1,600.


Source: CXOtoday

 

[Pintu]

Union Bank of India gains on bargain hunting

Union Bank of India gains on bargain hunting

Capital Market / 11:27 AM , Oct 27, 2009

Union Bank of India rose 3.69% to Rs 257.40 at 11:34 IST after net profit rose 39.7% to Rs 505.10 crore on a 20.8% increase in operating income to Rs 3760.90 crore in Q2 September 2009 over Q2 September 2008.

The result was announced during trading hours on Monday, 26 October 2009, when the stock had plunged 6.78% to Rs 248.25. The stock corrected 8.49% in two sessions to Rs 248.25 on Monday, 26 October 2009, from Rs 271.30 on 22 October 2009.

Meanwhile, the BSE Sensex was down 110.07 points, or 0.66%, to 16630.43.

On BSE, 1.03 lakh shares were traded in the counter as against an average daily volume of 1.97 lakh shares in the past one quarter.

The stock hit a high of Rs 259.90 and a low of Rs 245.65 so far during the day. The stock had hit a 52-week high of Rs 281.75 on 23 October 2009 and a 52-week low of Rs 113.15 on 27 October 2008.

The stock had outperformed the market over the past one month till 26 October 2009, rising 1.85% as compared to the Sensex 0.28% rise. It outperformed the market in past one quarter, rising 5.93% as against 8.85% rise in the Sensex.

The large-cap state-run bank has an equity capital of Rs 505.12 crore. Face value per share is Rs 10.

The current price of Rs 257.40 discounts the company's Q2 September 2009 annualised EPS of Rs 40, by a PE multiple of 6.43.

The earnings beat market forecast, but the economic slowdown is expected to mute bank's growth for the rest of the year.

The bank pruned its advances target for the year from an earlier projected 25% to 18% on the back of the economic slowdown, which has hit industrial growth and consequently, lending activity.

The bank's net interest margin widened to 2.34% during Q2 September 2009 from 2.27% in Q1 June 2009. The bank did not provide figures for its margins from a year earlier.

Quarterly net interest income--the difference between interest earned and interest paid--declined by 11% to Rs 864 crore in Q2 September 2009 over Q2 September 2008.

The bank reported a 33% fall in provisions for bad loans to Rs 135 crore.

Total expenditure rose 22% to Rs 2951 crore, driven by a 9% increase in operating expenses to Rs 609 crore and a 13% appreciation in other operating expenses to Rs 303 crore.

Interest expenses grew 26% to Rs 3206 crore from Rs 2829 crore while tax expenses also rose 26% to Rs 170 crore.

Net bad loans as a percentage of the total loan book grew to 1.25% from 1.12% a year earlier, the bank said. It has, however, hiked its bad loan projection for the year.

The bank's chairman and managing director, M V Nair put a conservative projection of 2% for gross non-performing assets (bad loans) for this year from the earlier projection of 1.75%.

Union Bank of India operates in four segments, namely treasury, retail banking, corporate banking and other banking operations.

The Government of India holds 55.43% stake in the bank (as on 30 September 2009).

 

[Pintu]

Tata Steel Q2 net dips 49% to Rs 903 cr - India Business - Biz - The Times of India

Tata Steel Q2 net dips 49% to Rs 903 cr
PTI 27 October 2009, 03:55pm IST

MUMBAI: Tata Steel today reported a 49.49 per cent decline in net profit at Rs 902.94 crore for the second quarter ended September 30, 2009.

The steel major had a net profit of Rs 1,787.81 crore in the second quarter of FY'09, Tata Steel said in a filing to the Bombay Stock Exchange.

Total income also declined by 18.23 per cent to Rs 5,768.16 crore during the period, from Rs 7,054.33 crore in the corresponding period a year-ago.

The company would announce its consolidated figures, which would include Tata Steel Europe (Corus), for the second quarter and the six months ended September 30 by end of November 2009, it added.

Shares of Tata Steel were trading down 6.09 per cent over previous close at Rs 507.65 on BSE.

 

[Pintu]

Andhra Bank registers Rs 274 crore net profit in Q2 - Earnings-News By Company-News-The Economic Times

Andhra Bank registers Rs 274 crore net profit in Q2
31 Oct 2009, 1657 hrs IST, PTI

KOCHI: Public sector Andhra Bank today said its net profit stood at Rs 274 crore in the quarter ended on September 30, a growth of 70 per cent over Rs 162 crore registered in the corresponding period last year.

Total business of the bank improved to Rs 1,10,460 crore, up by 27 per cent and the operating profit improved to Rs 453 crore, an increase by 63 per cent, Prasanna Panicker, Deputy General Manager, Andhra Bank, told reporters here.

Total deposits rose to Rs 62,279 crore, a growth rate of 23 per cent while the Credit Deposit Ratio had improved to 77.70 per cent.

Gross advances grew by 32 per cent to reach Rs 48,182 crore. The total income grew by 23 per cent and total expenditure had been contained at 14 per cent, she said.

The bank had opened 104 branches during the half year, taking the total number of branches to 1,536.

All braches of the bank were under Core Banking System (CBS) and Online Tax payment (e-tax) was launched along with internet banking, she said.

The bank was aiming to attain a business of Rs 1,30,000 crore by the end of March 2010 at a growth rate of 30 per cent and Rs 1,50,000 crore by September 2010, she said.

Panicker said Current Account and Savings Account (CASA) deposits stood at 32.34 per cent of the total deposits and the bank was targeting to reach CASA percentage of 33 per cent of total deposits by March 2010. "Bank will be rolling out the insurance products of its own Joint Venture for sale by July 2010," she said.

Bank was also planning to start banking subsidiary in Malaysia, jointly with Bank of Baroda and Indian Overseas Bank, which was expected to function next year, she said.

The bank with a business of Rs 600 crore in the state was targeting a business of Rs 750 by march 2010.

She said Bangalore Zone, consisting of Karnataka and Kerala, was aiming to touch a business level of Rs 6,500 crore and also 75,000 clientele by March 2010.

 

[Pintu]

'Need to provide Rs 5,000 crore to increase coverage ratio'

'Need to provide Rs 5,000 crore to increase coverage ratio'
Business Standard / Mumbai November 1, 2009, 21:16 IST

State Bank of India Chairman OP Bhatt addressed a press conference to announce the bank’s results and dwell on his expectations in the months ahead. Excerpts:

Provisioning for bad debt
At the end of September, the provision coverage ratio was 42.87 per cent, compared to 45.15 per cent three months ago. However, the provisions are more than what has been prescribed by the Reserve Bank of India (RBI). To meet RBI’s fresh stipulation of 70 per cent loan-loss coverage, we will need to make an additional provision of Rs Rs 5,000 crore by September 2010. We feel the regulator may give additional time to banks to meet the new norms. Our board will decide once the final guidelines are announced.

Rise in net interest margin (NIM)
The bank’s NIM improved to 2.43 per cent at the end of September 2009 as against 2.30 per cent in the previous quarter. We expect an improvement of 10-15 basis points each quarter. The cost of resources continues to decline and the bank is deploying resources in high-yielding advances, which are further helping us improve margins.

Casa growth
We expect to increase the share of Casa (current and savings accounts) to over 42 per cent from 40.96 per cent at the end of September. With an increase of 126 points in a quarter, we saw the highest increase in the industry. We have retired high-cost debt and high-cost deposits of around Rs 1,50,000 crore are getting repriced at 200 basis points lower rates.

Credit growth
We still feel we can grow 22-25 per cent on a year-on-year basis. There has been a pick-up in demand and the trend continues. This (third) quarter, we have disbursed Rs 21,000 crore. We have a strong pipeline of projects, there is a large amount of loans sanctioned but not disbursed and there is an increase in home loans that we are sanctioning.

Lending rate cut
There is no scope to reduce lending rates unless you lower the cost of deposits. The cost of deposits is very rigid and it takes a year to 18 months to correct it.

Capital requirement
The bank has projected a capital requirement Rs 36,000 crore over the next five years to maintain a capital adequacy ratio of 12 per cent.

 

[Pintu]

SBI board approves swap ratio for State Bank of Indore merger- Banking-Banking/Finance -News By Industry-News-The Economic Times

SBI board approves swap ratio for State Bank of Indore merger
31 Oct 2009, 2039 hrs IST, PTI

MUMBAI: Moving a step further for the amalgamation of State Bank of Indore with itself, the board of State Bank of India today approved the swap ratio for the merger.

"In today's board meeting, the board approved the swap ratio," SBI Chairman, O P Bhatt told reporters here, without disclosing the ratio.

With this, the merger of SBI with State Bank of Indore, which is the smallest subsidiary of SBI, is likely to be completed soon.

The Government had given its in-principle approval to the merger of State Bank of Indore with SBI early this month.

State Bank of Indore, which has 500 branches, posted a net profit at Rs 78.62 crore in Q2FY10. Its total income rose to Rs 776.39 crore from Rs 746.25 crore in the year-ago period.

For the half-year ended September, the bank posted a net profit of Rs 155.97 crore, up 48.31 per cent, from Rs 105.16 crore in the corresponding period last year.

As part of consolidating its operations within the group, SBI had acquired State Bank of Saurashtra last year.

Its other subsidiaries are State Bank of Travancore, State Bank of Mysore, State Bank of Biakner and Jaipur, State Bank of Hyderabad and State Bank of Patiala.

On the merger of other subsidiaries, Bhatt said the matter was being discussed at the Government level and the bank would go ahead with the process once it receives the approval from the Government.

Supported by a healthy growth in net interest income and core fee income, State Bank clocked a 10.19 per cent jump in its Q2 FY10 net profit at Rs 2,490 crore compared to Rs 2,260 crore a year-back.

It's standalone total income, during the quarter, stood at Rs 21,301.04 crore as against Rs 17,909.64 crore in the same period last fiscal.

 

[Pintu]

HUL profit dips 22% on exceptional item loss- Companies-The Sunday ET-Features-The Economic Times

HUL profit dips 22% on exceptional item loss
1 Nov 2009, 0031 hrs IST, ET Bureau

MUMBAI: Hindustan Unilever Limited (HUL), the nation’s largest FMCG company, on Saturday has announced a 22% dip in quarterly profit due to loss in exceptional item. Net profit of the company stood at Rs 429 crore in the September quarter, as compared to Rs 547 crore in the year-ago period while total income grew 4% to Rs 4,269 crore. HUL has also announced an interim dividend of Rs 3 per share.

Although the company’s FMCG sales grew by 7% on account of growth in personal products and foods, total revenues have been affected by a drop in export. HUL’s non-executive Chairman, Harish Manwani said rural India would continue to be a growth driver for the company. “Some of the actions that we have taken in the mass market will start to reflect in the subsequent quarters,” he added.

The loss in exceptional items stood at Rs 135 crore in the second quarter of the current year against a profit of Rs 109 crore in the year-ago period. Excluding the loss in exceptional item, HUL’s net profit grew 9.5% in the period.
Operating margins improved by 1.4% through a combination of carry forward impact of pricing, improved mix, step-up in cost saving programmes and better operating leverage. For the six months ended September, total income grew 5% to Rs 8,772 crore while net profit fell 12% to Rs Rs 972 crore.

In terms of segment growth, soaps and detergents grew 1% to end the quarter at Rs 2,004 crore while personal products was up 13% at Rs 1,190 crore. “About three-quarters of our business grew in double digits. For the other quarter, we have taken corrective action and the results will start showing over time,” said HUL’s managing director & CEO, Nitin Paranjpe.

 

[Pintu]

SBI Q2 profit rises 10% to Rs 2,490cr - India Business - Biz - The Times of India

SBI Q2 profit rises 10% to Rs 2,490cr
TNN 2 November 2009, 12:03am IST

MUMBAI: State Bank of India (SBI) reported a 10% rise in net profit to Rs 2,490 crore for the second quarter ended September 2009, compared to Rs 2,260 crore a year earlier, driven mainly by higher trading incomes and healthy interest income but despite higher provisioning for bad loans. SBI’s net profit was higher than the analysts’ estimates of about Rs 2,330-2,400 crore.

SBI’s net interest income (NII)—the difference between revenue from loans and interest paid on deposits—grew 2.8% to Rs 5,610 crore during the last quarter from Rs 5,460 crore during the year ago period, the bank said. The bank made higher provisions for bad debt at Rs 997 crore compared to Rs 911 crore.

State Bank of India’s trading income jumped 39% during the quarter to Rs 5,990 crore.