Bajoria keen to sell stake in Bombay Dyeing to Wadias
Kolkata—Arun Bajoria wants to offload his residual 4.9 per cent holding in Bombay Dyeing & Manufacturing to Nusli Wadia but at the price he wants. And he wants a price of Rs 100 a share.
Bajoria says he will expose "financial irregularities within Bombay Dyeing" to the shareholders in case the Wadias do not respond to his offer.
The Wadia camp, of course, did not respond.
To add insult to injury, the Wadias took legal action against the jute baron and have also recently announced plans to buy back the company’s equity shares.
Bajoria acquired Bombay Dyeing shares at an average cost of Rs 62-69 a share. He has in the last couple of months sold off nearly 10 per cent holding at Rs 92-93 on the stockmarket, booking a cool profit of Rs 9-10 crore (excluding his interest cost) on his investment.
Bombay Dyeing closed Friday at Rs 37 on both the National and the Bombay Stock Exchanges.
Bajoria is engaged in a protracted legal battle with the Wadias of the Bombay Dyeing. A petition has already been filed before the Company Law Board under Sections 397, 398 and 399, among others.
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Loans to Usha Ispat recalled by FIs
Mumbai—The Industrial Development Bank of India (IDBI) has recalled loans amounting to Rs 480 crore disbursed to Usha Ispat. Other term-lenders with a total Rs 300 crore exposure also are expected to follow suit.
The term lenders took this decision after a review came up with the finding that the project is a long way from taking off even after six years of the first appraisal.
IFCI, Unit Trust of India, General Insurance Company and Life Insurance Company will issue the recall notice after they receive consent from their respective boards.
IDBI is also planning to file a case against the company in the Debt Recovery Tribunal within the next few days.
These moves will result in the proposed integrated steel plant of Usha Ispat receiving a severe setback.
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Amul finds extraordinary success in pizzas
New Delhi—Amul has found extraordinary success in pizzas and far away from the pizza parlours of the metros, in remote Surat, Amul is brewing an ambitious plot without much ado having has just opened 10 pizza parlours in Gujarat.
In six months, Amul plans to scale up operations and plans to set up 2000 parlours in 100 Indian cities.
As with ice creams crucial to Amul’s strategy is its price policy. It is test-marketing a basic capsicum, onion, tomato pizza at just Rs 20, which could well change the contours of pizza consumption in the country.
With Domino’s similar fare at over Rs 90 or Nirula’s Rs 60 upwards this may change the contours of the business.

Company officials say that the response to the pilot project is pretty good and each parlour is selling over 100 pizzas a day. Even in remote areas of Mehsana and Palanpur in Gujarat -- where pizzas are virtually unknown -- the parlours were selling 50 pizzas every day, he said.
The pizza parlours would not be very big in size and an ordinary well- located retail shop could also get into an arrangement with Amul as the project is based on the franchisee model.
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Euclid closes operations in India
New Delhi-- California-based web infrastructure company Euclid Network Solutions is shutting its Indian operations.
Euclid is estimated to have invested between Rs 15 crore and Rs 20 crore in its operations in India which included three offices in Bangalore, Hyderabad and Delhi, all of which are now closed. Most of the 40-50 strong staff has been retrenched. A handful of them have been relocated to the US including chief executive officer Andra Delip Kumar.
Euclid was set up by two US-based non-resident Indians - Sateesh Andra and Rao Cherukuri. The company which turned its US office into the holding company and made India a wholly-owned subsidiary in 1999, raised $15 million in a second round of funding in February this year.
Incidentally, closure of Indian operations has come at a time when the company is using its second round of funding by Leapfrog Ventures and Bay Partners to expand sales and marketing activities in the US and to accelerate development of solutions and services framework. The company had received $5 million in the first round.
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AMP Australia picks up 4 percent stake in Gujarat Pipavav
New Delhi-- AMP Australia, which is among the world’s largest infrastructure investment fund managing about $200-billion investments, is acquiring close to four per cent equity stake in Gujarat Pipavav Port (GPPL) India’s first private sector port.
According to sources, AMP and GPPL have already finalised the stake acquisition deal at a price of a little over Rs 80 a share. The stake acquisition will cost AMP a total of about $12 million (close to Rs 60 crore).
Recently the Danish shipping major, Maersk acquired about 14 per cent stake in GPPL at Rs 70 per share for its stake.
Sources close to the company said Mearsk’s agreement with GPPL has a provision under which the shipping major could increase its stake in the port venture to 26 per cent within a timeframe of two years.
AMP also has investments in the Pradip Shah-promoted IndAsia fund.
Commonwealth Development Corporation of UK also holds 3.5 per cent stake in GPPL, while the rest of the equity holding is with the Indian financial institutions.
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RPL loses Rs 515cr on petrol, diesel on forced export
New Delhi—Reliance Petroleum (RPL) lost Rs 515 crore on "forced" exports of 2.725 million tonnes of petrol and diesel during 2000-01 fiscal as "it was denied fair access to the domestic controlled market".
RPL lost Rs 468 crore on "forced" exports of 1.597 million tonnes of diesel, while it lost Rs 47 crore on export of 1.128 million tonnes of petrol in 2000-01, the company said in a recent presentation to petroleum minister Ram Naik.
RPL said capacity expansion of national oil refineries by 22 million tonnes, after commissioning of its 27 million tonnes Jamnagar refinery in Gujarat in July 1999, had resulted in an oversupply situation due to which product offtake from its refinery was adversely affected.
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ICICI Lombard insurance JV gets clearance
Mumbai--ICICI has received clearance from the Reserve Bank of India clearance to enter non-life insurance business through its joint venture subsidiary ICICI Lombard General Insurance.
The central bank while providing the approval has asked ICICI to bring down its non-performing assets to below 5 per cent. This was one of the reasons why ICICI did not receive an immediate clearance from RBI last fiscal when first submitted the proposal.
Since then the company decided to bring down NPAs through an accelerated provisioning exercise and as per its March balance sheet NPAs were down to 5.2 per cent.
The other concern raised by RBI was the large number of subsidiaries. With 31 subsidiaries, the central bank felt that the number of arms were getting too unwieldy from the regulation point of view.
ICICI has given a commitment that it will bring down the number of subsidiaries to 21 by September," said a senior official at ICICI.
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IA divestment cast in gloom
Mumbai--The government's decision to bar the two bidders -- the Hindujas and Videocon International – and indefinitely defer Indian Airlines' divestment will adversely impact the disinvestment of Indian Airlines (IA) in particular and the overall divestment programme in general, merchant bankers said here on Saturday.
The government may now have to alter the mode of divesting its stake in the public sector undertakings (PSUs) that have been put on the block, and seriously consider the possibility of selling its stake directly to the financial institutions (FIs) and the public, they said.
Again with only one player left in the fray for Air-India now, the government's reserve price will now come under question. Even if the process is completed in a fair manner now, there will be political problems over the sale," they added.
The Cabinet decision to debar the Hindujas and Videocon was prompted by security concerns over the Hindujas' involvement in the Bofors issue and Videocon International's involvement in alleged price-rigging activity in the capital markets.
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Kopran extends Smyle brand
Mumbai--Kopran Pharmaceuticals has decided to extend the Smyle brand to a whole range of cosmoceuticals that will be launched in India by October 2001.
The company's cosmoceuticals range includes talc, soaps, hair oil and shampoos under the brand name Dr Shyne and Smyle.
The company recently test marketed its products in Dubai and Adarsh Somani, managing director of Kopran Pharmaceuticals, said, "The response from the Dubai market has been encouraging and we would like to increase the Smyle brand value to Rs 100 crore in the next two years." The Smyle brand of products contributed Rs 22 crore to the company's sales revenue during the last fiscal. Kopran Pharmaceuticals has set a sales target of Rs 45 crore for the Smyle range for the current fiscal, he added. The company currently sells herbal medicines, mainly in the cold and cough category, under the Smyle brand and allopathic medicines under the Dr Smyle brand name.
The company posted a Rs 14.41 crore profit for the year ended March 31, 2001, against Rs 9.58 crore in the corresponding period last year. Sales were also up at Rs 230 crore as compared with Rs 166 crore for the previous period of 9 months.
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Reckitt Benckiser phases out Dettol prickly heat powder
Mumbai--Reckitt Benckiser India has phased out the Dettol prickly heat talc powder, as its sales were stagnant. The company had launched the product just a year ago.
However, company officials said the company will relaunch Dettol prickly heat powder by summer next year, as it has confidence in the product and in the Rs 240 crore Dettol brand name.
Dettol prickly heat powder was earlier marketed by Reckitt Piramal, the joint venture between the Piramals and the Reckitt Benckiser group. However, with the joint venture no longer in existence, Reckitt Benckiser (India) will market the flagship brand Dettol.
During the year ended December 31 2000, Reckitt Benckiser (India) notched a total income of Rs 591.02 crore, up from Rs 510.11 crore during the previous year. Profit before tax too grew to Rs 30.01 crore, as against Rs 20.48 crore.
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Suvidha from Citi suffers from stiff competition in metros
Mumbai--Citibank's Suvidha scheme faces a tough time in Mumbai and Delhi in the face of stiff competition put up by new generation private sector banks and a few public sector banks, even it prepares to roll out the scheme in Kolkata and other major cities.
This is because new private sector and come public sector banks are aggressively putting up ATMs all over metro cities.
Citi’s Suvidha scheme, which targets the middle class, requires the account holder to maintain a minimum balance of Rs 1,000.
The customers can access their Suvidha accounts through ATMs, phone banking and Internet banking. However, customers who approach the branches are required to pay Rs 100 for a transaction. This is because Citi wants to discourage branch banking -- a move not liked by the customers.
Also other banks have started snatching its customers offering more ATMs as well as branches," said an industry observer.
When Suvidha was initially launched in Bangalore in 1998, it was a success due to its large ATM network. Now private sector banks have beaten Citi having managed to roll out ATMs and branches across the country.
Citibank has around 130 ATMs across the country compared with ICICI Bank's 550, UTI Bank's 350 and HDFC Bank's 253 ATMs.
These banks are expanding their ATM network at a rate of more than two a week. Even public sector banks such as the State Bank of India (SBI) and the Corporation Bank are on an aggressive ATM push. SBI is planning to put up around 1000 ATMs by the end of the year. These banks have a very wide brick and mortar presence across the country.
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MSEB says DPC power a necessity
Mumbai--Maharashtra faces the bleak prospect of load shedding and blackouts after the monsoons end unless the ongoing talks to resolve the Dabhol Power Company tariff imbroglio are successful.
A senior Maharashtra State Electricity Board (MSEB) official said once the monsoon season was over, the state will start experiencing an acute shortfall of around 1,200 mw in the evening peak period and a shortfall of around 500 mw during the rest of the day... unless power from the first phase of DPC is restored.
This effectively translates into three-hour blackouts becoming the norm in most of rural Maharashtra, as was the case in August-September last year.
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StanChart Bank sets up Net trading arm
New Delhi--Standard Chartered Bank is setting up a new wholly owned subsidiary in India for operating Internet portal and online trading operations. Last week, the company approached the Foreign Investment Promotion Board (FIPB) for this. According to the application, the subsidiary will establish and operate an Internet portal and engage in online trading.
Sources said, the bank is planning an initial investment of Rs 14 crore and the entire equity will be subscribed to by the bank’s UK-based principal, Standard Chartered Bank, UK.
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BSNL may not extend low intra cell tariffs to private operators
New Delhi--Bharat Sanchar Nigam Ltd (BSNL) is thinking of withdrawing the low tariffs for intra circle calls if it has to extend the benefits to private operators.
Recently the Telecom Regulatory Authority of India directed BSNL to offer a concessional tariff to private operators so that they could extend the benefits to their subscribers.
If BSNL withdraws the concessional tariff callers between two cities within the same circle would have to pay STD charges for calls. For instance, a three-minute call from Lucknow to Kanpur will cost Rs 14.40 against Rs 1.80 now. Thus more than 29 million customers of BSNL may get affected due to the ongoing feud between the PSU and private telecom operators over the issue of extending concessional tariffs for calls made within the 50 to 200 km range.
Early this year BSNL introduced concessional tariffs for intra circle calls ranging between 50 to 200 Kms, making STD calls almost as cheap as local calls and at present, BSNL customers pay Rs 1.80 for a three minute call made over a distance of 51 to 100 km. A call of the same duration over 101 to 200 km costs Rs 7.20. Customers without an STD connection can also make calls within a 200 km radius.
It all started when private cellular and basic operators made representations to TRAI that BSNL should extend the benefit of lower call charges to them. TRAI issued a directive to BSNL stating that the revised tariffs must also apply to inter network calls ie calls made from BSNL network to mobile network or to other private basic network.
BSNL responded to the directive requesting the regulator to review its directions but on February 9, the regulator reiterated its order and directed BSNL to implement the order by February 20.
BSNL then filed a case with the TDSAT seeking its intervention against the TRAI order.
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ONGC Videsh raises $115 m through FCNR (B)/rupee deal
Mumbai—The international arm of Oil and Natural Gas Corporation (ONGC), ONGC Videsh has raised $115 million through the first-ever FCNR(B)/rupee composite structured deal arranged by SBI Caps.
Sources say, the structured deal is an innovative instrument designed by SBI Caps to syndicate the amount from participating banks so as to give the borrower the advantage of using both dollar and rupee funds as per its time of requirement.
The banks lending in consortium include the Union Bank of India (UBI), which has offered funds at 45 basis points above Libor, State Bank of Travancore, which has parked funds at 48 basis points above Libor, Bank of India and State Bank of Patila both of which have lent at 50 basis points over Libor, sources added.
These funds, to be deployed by ONGC Videsh to commence oil exploration in Vietnam on a production sharing basis, has been raised at an average floating rate of 49 basis points above Libor which comes to 4.3 per cent with the current six month Libor ruling around 3.8 per cent.
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