High spectrum payout to bloat telcos' debt ratios: Crisil

"In the near-term their capital structure will be impacted," it said in a note, adding even the part payments for the spectrum will stretch their key capital ratios.

Aggressive spectrum bidding by the top three operators would adversely impact their capital structure in the short-term, though bagging airwaves is good for them in the long-term, ratings agency Crisil said today.

"In the near-term their capital structure will be impacted," it said in a note, adding even the part payments for the spectrum will stretch their key capital ratios. It said the debt to pre-tax profit ratio for these three, which include Bharti Airtel , Vodafone and Idea Cellular , would go up to 3.9 times from the 3.3 times before the auction.

The three leading operators are reported to have already paid Rs 7,690 crore, including Bharti's Rs 4,725 crore, Vodafone's Rs 1,030 crore and Idea's Rs 1,935 crore. The total winning bids for the three stand at Rs 89,396 crore of the overall Rs 1.10 lakh crore in bids. Much of the bids were for renewal of spectrum, while in some cases, the operators have also added fresh spectrum with an eye on the future.

"While the trio has had to cough up a lot of money for this, they also got spectrum for 20 years. Additionally, the spectrum they already hold beyond this does not come up for renewal in the medium-term," it said, expecting the three companies to consolidate their positions in the market. Their debts will "bloat" and it will be a challenge to get the required revenue growth due to stiff competition, which is only going to increase with the entry of Reliance Jio, Crisil said, adding the key monitorable will be the average revenue per minute which the three operators manage.

Bharti Airtel stock price

On April 08, 2015, Bharti Airtel closed at Rs 419.25, up Rs 10.10, or 2.47 percent. The 52-week high of the share was Rs 421.90 and the 52-week low was Rs 304.00.

The company's trailing 12-month (TTM) EPS was at Rs 28.61 per share as per the quarter ended December 2014. The stock's price-to-earnings (P/E) ratio was 14.65. The latest book value of the company is Rs 166.93 per share. At current value, the price-to-book value of the company is 2.51.

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Petrochemical regions attract investment of Rs 1.06 lakh cr

"The target of Modi Government is to achieve an investment of Rs 7,62,000 crore and generate employment for 34 lakh people in PCPIRs in time bound manner. Already there has been an investment of Rs 1,06,000 crore which has generated employment for 2.23 lakh people in various PCPIRs," fertiliser minister Ananth Kumar said.

Petrochemical investment regions in the country have attracted an investment of Rs 1.06 lakh crore so far and the target is to achieve Rs 7.62 lakh crore of investment in time bound manner, Fertiliser Minister Ananth Kumar has said.

Kumar informed this in a meeting of the Consultative Committee of Parliament attached to Fertiliser Ministry held yesterday to discuss the topic of 'Petroleum, Chemicals and Petrochemical Investment Regions (PCPIRs)' and Plastic Parks. "The target of Modi Government is to achieve an investment of Rs 7,62,000 crores and generate employment for 34 lakh people in PCPIRs in time bound manner. Already there has been an investment of Rs 1,06,000 crores which has generated employment for 2.23 lakh people in various PCPIRs," Kumar said in an official statement.

PCPIR is a delineated area of around 250 sq km for setting up manufacturing facilities for domestic and export led production. In March 2007, the Cabinet Committee on Economic Affairs had approved the proposal to set up PCPIRs in four states -- Gujarat, Andhra Pradesh, Odisha and Tamil Nadu.

Anchor tenant in Gujarat is  ONGC promoted OPal, while in Odisha the anchor tenant is IOCL . In Andhra Pradesh and Tamil Nadu, the anchor tenants are  HPCL and Nagarjuna Oil Corp , respectively. In the meeting, Kumar said the present challenge in the sector is value addition.

"For that value addition, milking the crude for further proliferation of the downstream industries is needed." Kumar also informed the members about the government's initiatives to increase the number of plastic parks from 4 to 10 to catch up with the increasing demand. He mentioned that the number of Central Institutes for Plastic Engineering and Technology (CIPET) will be increased from 23 to 100, to create additional capacity for skill development in the area. Kumar said the government is working on reducing the consumption of non-biodegradable plastics, and re-using and re-cycling of other graded polymers.

The government has instituted awards for Green Technology in plastic processing, to promote environment friendly efforts in the industry, he added.

ONGC stock price

On April 08, 2015, Oil and Natural Gas Corporation closed at Rs 312.85, down Rs 5.55, or 1.74 percent. The 52-week high of the share was Rs 472.00 and the 52-week low was Rs 301.00.

The company's trailing 12-month (TTM) EPS was at Rs 21.84 per share as per the quarter ended December 2014. The stock's price-to-earnings (P/E) ratio was 14.32. The latest book value of the company is Rs 159.81 per share. At current value, the price-to-book value of the company is 1.96.

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Glenmark's subsidiary to pay $25mn to settle a pricing case

The company will pay USD 11.25 million each to the US federal government and the Texas state administration in 16 tranches spread over four years, besides paying USD 2.5 million as the cost of litigation.

Pharmaceutical major Glenmark  on Wednesday said its US subsidiary will pay USD 25 million to the federal government there as well as to the Texas state administration to settle a pricing investigation.

The company will pay USD 11.25 million each to the US federal government and the Texas state administration in 16 tranches spread over four years, besides paying USD 2.5 million as the cost of litigation. "Our subsidiary Glenmark Generics Inc., USA has concluded the pricing investigation by the Texas Attorney General, USA.

Under the terms of the agreed settlement, there is no admission of liability. "Glenmark Generics will make a payment in 16 equal tranches of USD 1.56 million each quarter for next 16 quarters to the state of Texas," Glenmark said in a BSE filing.

Commenting on the settlement, Glenmark President, North America and Global API Business, Robert Matsuk said: "The settlement amount will not materially impact the organisation's cash-flow".

He further said: "We remain committed to continuing our mission of providing our customers with the finest generic pharmaceutical products in the US and complying with all applicable state and federal pricing requirements".

Elaborating on the settlement agreement, the company said: "Glenmark must pay the state of Texas a total of USD 11.25 million for the state's general revenue fund.

Because the Medicaid programme is jointly funded by the state and the US taxpayers, the federal government is entitled to a percentage of the settlement proceeds".

"The federal government's share is also USD 11.25 million. Additionally, the Texas Attorney General's Office will receive USD 2.5 million in attorneys' fees and costs," the company added.

Glenmark stock price

On April 08, 2015, Glenmark Pharma closed at Rs 884.00, up Rs 39.60, or 4.69 percent. The 52-week high of the share was Rs 901.20 and the 52-week low was Rs 546.60.

The company's trailing 12-month (TTM) EPS was at Rs 18.02 per share as per the quarter ended December 2014. The stock's price-to-earnings (P/E) ratio was 49.06. The latest book value of the company is Rs 107.12 per share. At current value, the price-to-book value of the company is 8.25.

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March saw $ 4.1bn cross border MA flows: Grant Thornton

The Modi government's Make in India policy has been met with strong enthusiasm and the merger and acquisitions seen in the month are proof of the same, says Prashant Mehra, partner, Grant Thornton.

In an interview to CNBC-TV18, Mehra shares the details of the M&A space and says USD 4.1 billion has come in from cross-border transactions.

IT and pharma continue to rule the roost in the M&A space.

Below is the verbatim transcript of Prashant Mehra's interview with Kritika Saxena on CNBC-TV18.

Q: So the overall deal values to that 8.2 billion, that is around 36 percent growth in terms of volume and 27 percent growth in terms of deal value. How significant is this if you take the year on year (YoY) perspective and of course how much of a contribution was the annual Budget cost of course which was this quarter to actually seeing this pickup?

A: As you rightly said, the year to date has seen 8.2 billion in deal values which is a 26 percent increase in values as compared to the same quarter last year and about 36 percent increase in the volumes as compared to the same period last year. As far as the Budget is concerned, the positive wave is still on. What is very encouraging is the fact that of this USD 8.2 billion, USD 4.1 billion has clearly come from cross border transactions and of the USD 4.1 billion, about USD 3.5 billion has been in relation to the inbound transactions which is a clear indication that the 'Make in India' wave seems to be showing its results.

Q: Can you break up the inbound and outbound deal activity for this quarter?

A: As far as this quarter is concerned, of the 4.1 billion total cross-border transactions USD 3.5 billion has come from inbound transactions and the balance USD 0.6 billion has come from outbound transactions and the outbound transactions will perhaps increase once the listed company results are out and we see the Indian businesses balance sheets coming out of the red, their balance sheets becoming stronger and thus they getting more interested in the outbound transactions.

Q: If you look at the private equity investment, I was taking a look at your report; It is an increase of around 36 percent in terms of values, 67 percent in terms of volume. The sectors are still the typical sectors that we see from IT, healthcare, consumer sectors, e-commerce—what are the other sectors that are now gradually picking up?

A: In terms of the private equity deal activity, what is a little interesting is the fact that the average deals size is come down from USD 15 million dollars to USD 12 million as compared to the same period last year which shows that private equity is taking small bites currently and we are yet to see high volume deals within the USD 50-100 million bracket. As far as the sector spread is concerned, yes pharma and IT, ITES have dominated the P/Es deals as well however we see encouraging trends coming out in real estate and banking and financial services and going forward with the real estate bill perhaps there will be more surge in real estate activity and in the next quarter or two perhaps in the infrastructure sector as well.

Q: Private equity interest in real estate has been quite significant. As you said, now with the recent development with respect to the regulator coming in, do you expect private equity players (PE) players to actively look at expanding within real estate and of course Blackstone takes the cake in that particular area?

A: Yes, absolutely. With the bill coming in place as real estate sector has been slightly notorious in terms of its corporate governance. All these regulations in place give more confidence to organise investors whether it is domestic private equity or international private equity to invest in this sector. Nobody can shy away from the fact that there is demand. There is a lot of potential in this sector and now with the corporate governance factors coming in we will probably see a lot more activity in these sectors.

Q: You also spoke about infrastructure and power. Could you give me a sense about what is the kind of activity in terms of mergers and acquisitions (M&A) be it inbound, be it out bound, of course there is a lot of requirement for investment as far as infrastructure roads, highways is concerned. There are individual road assets being on the block. Lot of debt-laden companies. Do you expect these sectors to see a pick up in the next quarter, because there have an increase in terms of conversation at least.

A: Yes, frankly speaking, the year-to-date has seen nothing significant or fancy to talk about in terms of the infrastructure sector. The recent Budget, the new government has promised and shown its commitment to this sector. But I think we are still to see that being brought into action and real data points coming out. I believe the government will need to all these projects will definitely be with the public-private partnership (PPP) model. But the government will really need to show its commitment in terms of data points in making self investments in this sector which will in the future be partnered with private players. So, perhaps another quarter before we start seeing something real coming in, in terms of announcements of deals.

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CIL allowed to sell more coal via e-auction

"With the approval of the competent authority, it has been decided to revert to the old system (on e-auction)...," the letter said. Under the old system, Coal India was allowed to sell up to 10 percent of coal through e-auction.

In a boost to Coal India Ltd , the government has increased the quantity of coal that the state-owned miner can sell through e-auction. Coal India Ltd had last year sold 7 percent of the total sales through e-auction.

The government had in a letter dated April 1 written to Coal India stating that the modalities of e-auction of coal beyond March 31, 2015 was considered by the ministry.

"With the approval of the competent authority, it has been decided to revert to the old system (on e-auction)...," the letter said. Under the old system, Coal India was allowed to sell up to 10 percent of coal through e-auction. According to the source, Coal India may take a decision of allowing the e-auction of coal up to 10 per cent.

Under e-auction, coal is sold at spot market price. Last year, Coal and Power Minister Piyush Goyal had asked CIL to reduce the quantity offered in e-auctions so that power utilities can get more supplies of the fuel. The company was directed to limit e-auctioning of coal to 25 million tonnes in the last year from 57 MT.

However, according to the sources, in the last fiscal 49 million tonnes of coal was sold through e-auction as it was asked by the ministry to e-auction the surplus coal from those mines that have been facing evacuation constraints. "Coal which is found surplus at the said mines (having serious evacuation constraints) after meeting the requirement ...shall be e-auctioned," the Coal Ministry had earlier said in a letter to CIL. There has been a large accretion of coal during this peak production season at mines which have serious evacuation constraints, the ministry had said.

At the same time, coal needs to be made available to the FSA (Fuel Supply Agreement) holders on priority, it added. Coal India has missed its production target for the financial year 2014-15 by 3 per cent and just achieved an output of 494.23 million tonnes. The company's output target was 507 million tonnes for the fiscal.

Coal India stock price

On April 08, 2015, Coal India closed at Rs 380.00, up Rs 20.60, or 5.73 percent. The 52-week high of the share was Rs 423.85 and the 52-week low was Rs 283.60.

The company's trailing 12-month (TTM) EPS was at Rs 6.97 per share as per the quarter ended December 2014. The stock's price-to-earnings (P/E) ratio was 54.52. The latest book value of the company is Rs 26.04 per share. At current value, the price-to-book value of the company is 14.59.

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Not yet finalised deal to sell Chennai unit: Kansai Nerolac

The Chennai unit which was closed in 2013, the Kansai Nerolac Paints Ltd said it decided to close the factory due to high wages and low productivity and the machinery and the plant have become outdated and unproductive.

Industrial paint manufacturer Kansai Nerolac today said it has not finalised any deal to sell the Chennai unit along with the company's other surplus assets. "...we have intimated that all the manufacturing activities at Perungudi in Chennai has been stopped, as such the assets have become surplus to our requirements. It was also mentioned, the Board has given its in-principle approval to explore various options for monetization of surplus assets of the company," Kansai Nerolac Paints Ltd   said in a BSE filing.

Responding to reports of sale of the Chennai factory, the company said, "At this point of time, no deal has been finalised and no decision on the same has been taken with regard to sale of Company's land at Perungudi, Chennai".

About the Chennai unit which was closed in 2013, the company said it decided to close the factory due to high wages and low productivity and the machinery and the plant have become outdated and unproductive.

"Expansion of the unit was also not feasible.All the workmen of the company opted for voluntary retirement scheme. The assets have become surplus to our requirements," it said. Shares of the company today closed at Rs 225.65 apiece, up 0.69 percent on the BSE. 

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Microsoft to bring more 4G phones

The company, which acquired Nokia's handset division last year for USD 7.2 billion, has only one 4G-compatible device, Lumia 638 (priced at about Rs 6,800), in the Indian market.

Technology giant Microsoft today said it will line up more 4G-compatible devices in India once the infrastructure for the high speed Internet service is ready in the country. The company, which acquired Nokia's handset division last year for USD 7.2 billion, has only one 4G-compatible device, Lumia 638 (priced at about Rs 6,800), in the Indian market.

"There are a number of 4G-compatible devices in our portfolio, we are ready with the handsets.Once infrastructure is ready (in India), we will bring more 4G devices in," Microsoft Mobile Devices Director Marketing Raghuvesh Sarup told PTI.

Many devices makers are now lining up 4G-compatible phones (especially in the sub-Rs 10,000 category) as operators like Reliance Jio gear up to launch the high-speed Internet service in the country. Currently, Airtel  and Aircel are the only two operators offering 4G services in certain parts of the country. 

Lenovo's A6000 and A7000, Yu's Yureka and Xiaomi Redmi Note 4G are some of the devices that hit the Indian market in the sub Rs 10,000 segment recently. Meanwhile, Microsoft today launched two new handsets -- Lumia 640 and Lumia 640 XL -- in India, priced at Rs 11,999 and Rs 15,799, respectively. While both the devices are available in LTE versions, these will not be available in India currently.

"Consumers today are constantly looking for a device to bring them more flexibility to switch easily between work and play. The Lumia 640 XL and Lumia 640 are the perfect devices that are enablers of productivity, busting the 9 to 5 myth by letting you achieve more on your own terms," Microsoft Mobile Devices Director (South) T S Sridhar said. The Lumia 640 will be available on eCommerce portal, Flipkart, while the Lumia 640 XL will be available in physical retail stores.

The dual SIM-Lumia 640 comes with 5-inch HD display, 1.2GHz quad core Qualcomm Snapdragon processor, Windows Phone 8.1 with Lumia Denim operating system, 8 MP rear and 1 MP front facing cameras, 8GB internal memory (30 GB free OneDrive and micro SD support up to 128 GB) and 2,500 mAh battery. The Lumia 640 XL has a 5.7-inch display, 13 MP rear and 5 MP front cameras and 3,000 mAh battery.  

Bharti Airtel stock price

On April 07, 2015, Bharti Airtel closed at Rs 409.15, up Rs 8.15, or 2.03 percent. The 52-week high of the share was Rs 419.90 and the 52-week low was Rs 304.00.

The company's trailing 12-month (TTM) EPS was at Rs 28.61 per share as per the quarter ended December 2014. The stock's price-to-earnings (P/E) ratio was 14.3. The latest book value of the company is Rs 166.93 per share. At current value, the price-to-book value of the company is 2.45.

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Suzuki eyes 5L sales in India in FY16

Japanese motorcycle major Suzuki will focus on niche segment bikes of 150 cc and above in India, targeting young customers, as it chases over 30 per cent rise in sales at 5 lakh units in the current fiscal.

The company's Indian arm, Suzuki Motorcycle India Pvt Ltd (SMIPL) is also aiming for over 40 per cent increase in sales of its super bikes, which includes the likes of Hayabusa and GSX-R, to 400 units this fiscal with plans to launch new global models of above 800 cc bikes like S1000 and S100F.

SMIPL, which today launched a variant of its flagship model Gixxer, priced at Rs 83,439 (ex-showroom, Delhi), had sold a total of 3.74 lakh two-wheelers in 2014-15.

"Going forward, our focus would be on 150 cc and above bikes. Our products will be towards niche segment bikes. We intend to focus on products for young and young-at-heart customers," Suzuki Motorcycle India Executive Vice President Atul Gupta told reporters here.

Elaborating on the company's strategy, Gupta said: "There is a severe competition in the mass segment bikes. Your bottomlines don't get affected while in the niche segment, even though you sell less units, you can earn money." He, however, said that the company will continue to sell its mass segment motorcycle Hayate while stressing that focus would be on niche bikes going forward.

On super bikes, Gupta said: "Last year, we sold 280 units in the country and this fiscal we are looking to sell 400 units." He said SMIPL plans to launch 'a few' more superbikes in the country simultaneously with global launches, including the S1000 and S1000F that are expected to hit markets sometime in June.

The company is also looking to expand its sales network in the country with a target to set up 1,500 touch points by March 2016. "From 600 touch points, we have now touched a figure of 800 outlets now. By March 2016, we aim to take this number to 1,500 outlets," Gupta said.

The company would focus on strengthening distribution network in A and B class cities, he added. Commenting on rural markets, which are performing below par, Gupta said: "Our sales are not impacted as we sell only one mass segment bike." When asked about exports, Gupta said the company is looking at around 50,000 shipments abroad in the current fiscal from 30,000 units it exported in 2014-15. At present, the company exports to various markets, including Latin America, Middle East, Africa and neighbouring countries.

Suzuki Motorcycle India has an installed capacity to churn out 5.4 lakh units annually. The company gets 80 per cent of its sales from scooter segment and the rest from bikes.

Maruti Suzuki stock price

On April 07, 2015, Maruti Suzuki India closed at Rs 3601.00, down Rs 25.75, or 0.71 percent. The 52-week high of the share was Rs 3785.15 and the 52-week low was Rs 1867.00.

The company's trailing 12-month (TTM) EPS was at Rs 106.83 per share as per the quarter ended December 2014. The stock's price-to-earnings (P/E) ratio was 33.71. The latest book value of the company is Rs 694.45 per share. At current value, the price-to-book value of the company is 5.19.

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Xiaomi no more exclusive to Flipkart

Xiaomi which launched its first smartphone in India in July 14, partnered to sell its handsets with Flipkart alone has now added two more partner channels that one can purchase from- Snapdeal and Amazon India.

Chinese handset maker Xiaomi will not be exclusive to Flipkart anymore as the company has decided to start selling its smartphones on other eCommerce sites such as Snapdeal and Amazon as well.

The firm, which launched its first smartphone in India in July last year, had opted for the online route to sell its handsets partnering with online marketplace Flipkart. "Starting tomorrow, 8 April, we're adding two more partner channels that you can purchase from Snapdeal and Amazon India," Xiaomi said in a post on its official Facebook page.

To reach out to more consumers Xiaomi has also ventured into brick and mortar stores by partnering with retail chain The Mobile Store. It has also entered into a partnership with private telecom operator Bharti Airtel.

"This means you can now purchase your favourite Mi products from Flipkart, Snapdeal and Amazon India online, and The Mobile Store and Airtel if you prefer to buy in stores," it added.

Founded in 2010 by serial entrepreneur Lei Jun, Xiaomi is often referred to as the 'Apple of China'. According to research firm IDC, Xiaomi's global market share of smartphone shipments in October-December 2014 stood at 4.42 percent, while the firm a share of 4 percent in India and 13.7 percent in China during the same period.

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May cut 1-year bucket deposit rate by 25 bps: SBI

SBI Chairman Arundhati Bhattacharya refused to get into a debate on whether the 15 bps cut will lead to credit growth getting a fillip.

India's largest lender  State Bank of India lowered base rate by 15 basis points to 9.85 percent. Chairman Arundhati Bhattacharya termed the timing of the cut as 'right'.

Earlier in the day, the Reserve Bank refrained from reducing rates any further in part due to commercial banks failing to pass on the benefits of the previous two rate cuts undertaken this year. In its policy statement, the RBI said: "Transmission of policy rates to lending rates has not taken place so far despite weak credit off take and the front loading of two rate cuts."

Bhattacharya may also cut one-year bucket deposit rate by 25 basis points. She, however, refused to get into a debate on whether the 15 bps cut will lead to credit growth getting a fillip.

Stay tuned for more…

SBI stock price

On April 07, 2015, State Bank of India closed at Rs 271.90, down Rs 2.65, or 0.97 percent. The 52-week high of the share was Rs 335.90 and the 52-week low was Rs 188.01.

The company's trailing 12-month (TTM) EPS was at Rs 16.61 per share as per the quarter ended December 2014. The stock's price-to-earnings (P/E) ratio was 16.37. The latest book value of the company is Rs 158.43 per share. At current value, the price-to-book value of the company is 1.72.

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