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  Business News
 Sensex down 264 pts as bank, refinery stocks dip

Mumbai, April 9: The BSE Sensex today fell nearly 264 points to one-week low of 17,222.14 on widespread selling by funds, especially in banking and refinery stocks, amid weak markets in Asia on investor concerns over slow growth in US jobs and global economic recovery.

Besides, investors have been cautious ahead of fourth quarter corporate earning results, industrial growth data and the Reserve Bank’s annual monetary policy next week. Overall, 12 of the 13 sectoral indices closed with losses of up to 3.44 per cent. Only BSE-Healthcare closed with moderate gains.

Besides, 25 of the 30 Sensex stocks closed in the red, with L&T, ICICI Bank, SBI, ITC, HDFC, Infosys, Tata Steel, RIL, TCS, BHEL, Hindalco and ONGC together erasing 200 points from the index.

Sensex resumed lower and remained in the red zone throughout the day. It finally closed at 17,222.14, a drop of 263.88 points or 1.51 per cent. In the previous trading last Wednesday, it had dipped 111.40 points or 0.63 per cent.

The NSE 50-issue index Nifty plunged 88.50 points or 1.66 per cent to 5,234.40. Brokers said metal stocks fell heavily amid fears of a slowdown in the world economy in view of weak jobs growth data in the US. A weak trend in the Asian region fuelled selling trend. European markets were closed for ‘Easter Monday’.

“It was not a very encouraging start to a week that will signal the start of the earning season with bellwether Infosys declaring Q4 numbers on Friday and RBI policy meet on April 17,” said Sharmila Joshi Head Equity Fairwealth Securities.

“We will also deal with inflation numbers and monthly IIP data before the week is out. It was perhaps this nervousness that got reflected in the stocks and the interest rate sensitives took it on the chin and SBI and ICICI Bank ended lower,” she added.

FIIs also seemed to have slowed down their purchases as they picked up shares worth Rs 45.81 crore on Wednesday.

Of the Sensex stocks, Hindalco dropped 5.18 per cent, followed by Sterlite (4.34 pc), Bhel (3.71 pc), L&T (3.50 pc), Jindal Steel (3.46 pc), Tata Steel (3.21 pc), SBI (2.91 pc), NTPC (2.62 pc), Maruti Suzuki (2.59 pc), ICICI Bank (2.29 pc), Gail India (2.21 pc), M&M (2.14 pc), ONGC (1.81 pc), HDFC (1.65 pc), Coal India (1.46 pc), ITC (1.36 pc), TCS (1.34 pc), Hero Motocorp (1.26 pc), Wipro (1.15 pc) and Sun Pharma(1 pc). However, Cipla gained 1.34 pc and Hul 1.06 pc.

Among the sectoral indices, the BSE-Metal fell 3.44 pc, followed Capital Goods - 3.16 pc, Power - 2.49 pc, PSU - 2.05 pc, Bankex - 1.81 pc, Consumer Durables - 1.56 pc, Oil&Gas - 1.49 pc, Auto - 1.13 pc, Teck - 1.13 pc and IT - 1.12 pc.

The total market breadth was negative as 1,640 stocks ended in the red, while 1,179 finished in the green. The total turnover was relatively low at Rs 1,851.14 from last Wednesday’s level of Rs 2,126.50 crore. (PTI)


 India, Qatar sign oil pact, discuss Indians’ welfare

New Delhi, April 9: India and energy-rich Qatar, home to half a million Indians on Monday sealed six agreements in diverse areas, including an overarching pact on cooperation in oil and gas exploration.

Prime Minister Manmohan Singh held talks with Qatar’s Emir Sheikh Hamad bin Khalifa al-Thani, who began a three-day visit to India Sunday, on a range of issues, including boosting trade and investment as well as energy ties between the two countries.

Issues relating to the welfare of Indian workers in the Gulf country were also discussed. During the talks, India is understood to have expressed its keenness to export more oil and LNG from Qatar. The Qatari side is broadly positive towards the Indian proposal, but there are pricing issues that remain to be sorted out.

After the talks, India’s Petroleum Minister S Jaipal Reddy and Qatar’s Energy Minister Mohammed Bin Saleh al-Sada signed a pact on establishing a co-operative framework to enhance bilateral cooperation in oil and gas.

The pact envisages co-operation in the areas of upstream and downstream oil and gas activities. It is expected to encourage and promote investment and co-operation between two Ministries of oil and gas and through affiliated companies.

Qatar, which holds the world’s third-largest natural gas reserves after Russia and Iran, has an LNG (liquefied natural gas) export capacity of 77 million tonnes a year. India buys 7.5 million tonnes of LNG from Qatar under a long-term contract. India imported 5.6 million tonnes of oil from Qatar in 2010-11 and is willing to increase the imports.

Three agreements were signed in the fields of educational exchanges, cultural contacts and promoting tourism. A memorandum of agreement was signed between the Reserve Bank of India and Qatar Central Bank.

The pact will establish an arrangement for sharing of supervisory information and enhancing cooperation in the area of banking supervision. Another pact on exchange of experiences, information and expertize in the field of legal affairs was also signed.

Vice-President Hamid Ansari, United Progressive Alliance (UPA) chair Sonia Gandhi and BJP leader Sushma Swaraj, also leader of the opposition in Lok Sabha, also called on the emir of Qatar.

The visit of Qatar’s Emir underlines India’s burgeoning ties with the Gulf region, which contributes over 50 per cent of India’s oil imports. The region is home to over six million Indians who send $30 billion in remittances. (IANS)


 Kingfisher employees get salaries after 4 months

Mumbai, April 9: A large section of Kingfisher Airlines employees, including pilots and engineers, received their salaries on Monday after a delay of nearly four months, airline sources said on Monday.

“In fact, we paid the salaries of all employees on Apr 4 itself. However, due to some back-end problem in one of the banks, a section of employees could not get it then,” they said. Chairman of the crisis-hit airline Vijay Mallya had last Tuesday assured his employees that their salaries would be disbursed in a staggered manner from April 4 to 10.

The airline has salary accounts in HDFC Bank, Axis Bank and ICICI. Besides, the airline has also paid the second instalment of Rs nine crore towards the TDS as per the directives of the Tax tribunal, the sources said. The airline has outstanding dues of about Rs 349 crore.

Mallya is also understood to have informed DGCA about the payments made, as the aviation regulator had expressed concern that delays in salaries would impact Kingfisher’s operations and affect the air travellers. Facing the heat from employees, particularly the pilots and engineers who had had put the airline on notice by giving a deadline of April 20 to clear all their pending dues, Mallya had issued an e-mail to pacify the agitating staff.

Admitting that the salaries were seriously overdue, Mallya in his letter promised to pay their salaries and other dues in a staggered manner, saying the problem had arisen as its bank accounts were frozen by tax authorities. The tax authorities had last week de-freezed the accounts on March 31 after the airline paid Rs 44 crore to the Income Tax department and another Rs 20 crore to the Service Tax authorities. (PTI)


 Beverage makers set for summer war in $10 bn market

New Delhi, April 9: With the mercury rising and the fizz getting louder, beverage makers are launching new products and campaigns with catchy taglines to grab a share of the $10 billion Indian marked, amid growing consumer base and fierce competition.

PepsiCo, which has started the new year with some product-centric innovations and big brand campaigns, has launched two new flavours of its soft drink Mirinda - Orange Masala and Orange Mango.

“Through this unique local palette-led innovation, we expect to drive consumption frequency and penetration,” Deepika Warrier, executive director, marketing, PepsiCo Beverages, India said.

“We have launched innovative and consumer-focussed initiatives to drive consumption. We are also investing heavily in expanding distribution and have created a state of the art, segmented G2M strategy based on three filters - portfolio class, town class and outlet class,” Warrier added.

Other players have taken the health route to lure customers. Cadbury India, part of US-based Kraft Foods, has launched Tang Mango focussing on the drink’s nutritional value.

“Tang has yummy fruit flavours and is fortified with essential vitamins and minerals -- thereby balancing refreshing goodness for the kids,” said Narayan Sundararaman, director, powdered beverages, Gum and Candy, Kraft Foods.

The firm is also working on a range of flavours to suit local tastes. The focus will also be on sampling for consumer awareness and trial generation.

The soft drinks industry in India is $10-billion-strong, and growing at 6-7 per cent per annum, says the ministry of food processing industries. Yet, per capita consumption of in India is 5-6 bottles  compared to Pakistan’s 17 and Sri Lanka’s 21.

Both players and industry watchers expect the market to explode in the years to come, given the country’s young demographics and rising affluence. They say new drinks in the industry energy drinks, flavoured water, sports drink, mixture of dairy and juice are all coming up because people want them.

Also, there is a cultural shift. Consumers want to buy beverages rather than prepare these on their own. And that’s why companies are working towards expanding the category and promoting them with nice packaging and subliminal advertising. The is also an effort at getting first-time consumers with lower price points, especially in rural areas.

In the juices segment, the company recently launched the range of Minute Maid 100 per cent juices which suitably complements our portfolio of juice drinks such as  Maaza, Minute Maid Pulpy Orange and Minute Maid Nimbu Fresh.

“From a consumer's perspective, our strategy continues to be that of offering a range of products in different packs at varying price points, as per the occasion, brand, price, pack, and channel model,” the spokesperson said.

India figures among the Atlanta-based multinational’s top 10 markets. It has announced plans to invest $2 billion over the next five years starting 2012 to further capture the opportunity in the Indian non-alcoholic, ready-to-drink beverage market.

Home grown Rasna is up to setting up a subsidiary, Rasna Beverages, to make high margin ready-to-drink products like energy drinks, fortified water and premium fruit juices in collaboration with global firms.(IANS)


 Government sets up study group on CTC for common service tax, excise
New Delhi, April 9: The Finance Ministry today set up a study group to look into the possibility of a Common Tax Code (CTC) for service tax and central excise duty. “A Study Team has been set-up by the Government, under the leadership of M K Gupta to examine the possibility of a common tax code for service tax and central excise, which could be adopted to harmonize the two legislations,” a finance ministry statement said. The study group would submit its report to the Finance Minister by September 30, 2012.The government is in the process of coming out with a Direct Taxes Code (DTC) with a view to replace the archaic Income Tax Act. The study group would look at procedural simplification of the existing input tax credit scheme and suggest ways to mitigate cascading effect of taxes. It will also endeavour to make the CTC trade-friendly. “The Study Team may also suggest any other measure that will help in reducing the cost of compliance for business or transition towards a comprehensive Goods and Services Tax (GST),” the statement said. (PTI)


 Sibal to launch Bharti Airtel’s 4G services
New Delhi, April 9:  Communications Minister Kapil Sibal is expected to launch Bharti Airtel’s broadband wireless access (BWA) services based on 4G technology in Kolkata on Tuesday. A successor to the 3G and 2G families, 4G is expected to be five times quicker than 3G services. It would offer services such as high-definition mobile TV and video conferencing. Airtel has selected Chinese telecom equipment maker ZTE to manage its services in Kolkata. The firm bagged BWA spectrum in four circles  Kolkata, Maharastra, Punjab and Karnataka for Rs 3,314.36 crore in 2010 along with other players including Reliance Infotel (earlier known as Infotel Broadband Services), Qualcomm, Tikona, Aircel and Augere. While Infotel became the only player to win a pan-India licence, Qualcomm bagged licences in four circles, Tikona in five circles, Aircel in eight circles and Augere in one circle. The auction fetched the exchequer over Rs 38,500 crore. With this launch Airtel will become the first player to launch the 4G service in India. The company said that launch of the service in other circles will happen soon. The other players are yet to announce plans to roll-out 4G services. (IANS)



Alembic Pharma has target of Rs 80: PN Vijay

Vijay told CNBC-TV18, “Alembic Pharmaceuticals is very old company and not recognized by the market. Alembic is of course probably India’s oldest pharmaceutical company, more than 100 years old, I think the Amin family. Their brands are very famous Glycodin, Zeet and in fact among the top 100, I think they have about 4 which is very good for a company of its size.” He further added, “It is a midcap pharmaceutical company with the main plant in Gujarat and they have recently added capacity in Baddi in Himachal Pradesh to take advantage of tax benefits. They have done wonders to their balance sheet, they have brought down the debt equity, which is now down to 1 and probably coming down.” “Last quarter was excellent for them, the topline grew 15% but the bottomline grew 51% because they are making major forays into Brazil and their export of formulation, some of the few Indian companies that export formulations incidentally and APIs has been pretty good.” “Going forward, I expect the company’s profits to grow at about 30% and the topline about 17-18%. It is trading at a very nice price earnings of about 7 or slightly over 7. It trades at Rs 53, it has gone up a bit in the last few weeks but at Rs 53, I think it is still a compelling buy. It is likely to be re-rated because I see no reason why it should be much lower than Cadila for example and I am giving it a target price of around Rs 80 in the next twelve-fifteen months.”

Book some profits in Ranbaxy near Rs 500: LKP

Bothra told CNBC-TV18, “Ranbaxy in particular looks extremely good. Infact in the last interaction also I had mentioned that it’s a buy on dips candidate very definitely, Rs 500 is a very crucial psychological resistance.” He further added, “After a strong rally which it has seen from Rs 430-428 levels to Rs 500 there would be a level where probably it might just cool off, consolidate, retrace to Rs 470-475. So at this point of time if someone is holding long positions very close to that Rs 500 level you should probably look to part profits and once it comes down to Rs 475-480 levels, you should add on to the stock again but yes it’s a buy and it’s a hold.”

Hindalco Industries has support at Rs 100: LKP

Bothra told CNBC-TV18, “There are three stocks in the entire metal space which look bearish to me - JSW Steel, Sterlite as well as Hindalco. In Hindalco particularly the intermediate term charts are extremely bearish. This candidate looks that it might break that even Rs 100 barrier, it’s too far fetched at this point but the weakness in the charts in the last 4-5 weeks signal that the midterm support lies at Rs 100 levels. So I would be extremely bearish on Hindalco.” He further added, “There is a short-term candidate in JSW Steel because of the descending triangle formation similar to that which has been anticipated on Nifty. If it closes below Rs 690 today you should see a downside of Rs 650-640 on JSW Steel, strict stoploss of Rs 710.”


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