Mercator Lines plans to raise borrowing limit to Rs 500 cr
Mumbai: Mercator Lines is increasing the borrowing limit to Rs 500 crore from Rs 100 crore in order to facilitate implementation of future expansion plans. A resolution seeking shareholders’ approval for enhancing the borrowing powers of the board of directors has been sought in the forthcoming annual general meeting. "The trend of the past few years will show that the company has been expanding by adding more and more vessels to its fleet. This is being done to explore benefits of varying market conditions. All the expansions have been implemented successfully, which is apparent from the year-to-year financial performance of the company," the notice to the shareholders said. As on March 31, 2003, Mercator Lines had a secured debt of Rs 31.75 crore on an equity of Rs 5.50 crore. The company recently shot to fame after bagging a contract for crude transportation for Mangalore Refineries and Petrochemicals Ltd (MRPL). The MRPL contract for movement of crude for the last four years since its inception was bagged by Great Eastern Shipping Company. This was the first time that Mercator Lines has bagged the contract after MRPL was acquired by Oil and Natural Gas Commission. The estimated value of this contract was Rs 100 crore and the board had approved an expansion programme to add two second hand vessels at a total cost of Rs 70 crore. Meanwhile, Mercator Lines scrip at the BSE had spurted from Rs 49 on July 15 to Rs 153 on August 19, increasing three times in a month’s time following the MRPL order. Analysts believe that the company might be contemplating a right issue to raise funds for its expansion, though company officials continued to be silent on this subject.
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Ispat Industries posts Rs 11 cr profit in Q1
Mumbai: Ispat Industries Ltd has reported a net profit of Rs 10.90 crore for the first quarter ended June 30, 2003 as compared to a net loss of Rs 57.92 crore for the corresponding quarter last year. Total income grew by 35.54 per cent to Rs 773.38 crore as against Rs 570.60 crore last year, an Ispat release said. During the quarter under review, interest costs declined to 71.85 crore from Rs 91.55 crore, while depreciation costs declined to 52.14 crore from Rs 53.04 crore last year. The production of hot rolled coils (3,26,189 MT) was up by 30.6 per cent, while that of galvanised coil/sheet (73,214) was more by 11.4 per cent during the quarter.
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Pepsi to use bottled water from now on, Says Bakshi
New Delhi: Even as the dust raised over alleged pesticides in soft drinks is yet to settle down, Pepsico has decided to use bottled water for its Fountain Pepsi outlets across the country against filtered tap water being used at present. The cola major also plans to launch its Aquafina brand of bottled water in 25 ml jar packs in the city soon. "We have decided to use bottled water only for Fountain Pepsi in India. This decision was taken last week after the pesticide controversy broke out," Pepsico India chairman Rajeev Bakshi said here. He said initially the company will use other bottled water brands available in large-sized packs like 25 ml jars till its own brand is available in the larger packs. At present, the Fountain Pepsi outlets use cuno filters to filter the tap water before using it in the cola served from the Fountain.
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Andhra Pradesh govt’s VST selloff programme in top gear
Hyderabad: The Implementation Secretariat (IS), the nodal agency for selling the Andhra Pradesh government’s PSUs, has sent application forms for the seven companies which have shown expression of interest (EoIs) for picking up AP government’s 4.69 per cent stake in VST Industries on Wednesday. Following the completion of EoI process on Wednesday, the IS has sent bid documents containing prescribed format to submit bids, terms and conditions, specimen bank guarantee, etc. to the seven registered persons, including the last entrant - CD Equisearch Private Ltd of Kolkata. Earlier, IS had sent similar set of documents to the registered persons in case of four listed companies - ACC, HIL, SPML and Telco on August 18. In all the response to the state government’s disinvestment plan has been very encouraging, said the IS release here. According to the IS release, the last date for submission of bids in the sealed envelopes for all the five companies is fixed on August 29 and the IS will open the bids on the same day starting from 4.15 pm onwards at an half-hour gap in between each companies in the chronological order starting from ACC.
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Cobra to invest $15 million for Hyderabad greenfield brewery
Bangalore: Cobra Indian Beer Pvt Ltd, which has been exporting beer to India from the UK, plans to set up a greenfield brewery in Hyderabad at an estimated cost of $10 to $15 million. Speaking to journalists here, Perses Bilimoria, regional director, Cobra Indian Beer Ltd, set a timeframe of two to five years for the Hyderabad venture to be operational. Meanwhile, the company plans to start licensed manufacturing in the country and has shortlisted three breweries in northern, southern and western regions of the country. The company’s plans to manufacture beer in India is due to logistics and cost rationalisation. Bilimoria said, "We are expecting to start production from India by February 2004 and will be upgrading the breweries according to our standards which will require an investment of $2 to $4 million per brewery." "Logistics was the key reason for shifting production from India to the UK years back and we are setting up production here for the same reason," he added.

Cobra is one of the fastest growing beer brands in the UK with a growth rate of over 43 per cent in the past eight years. The company is looking forward to emulating this success on India too, Mr Bilimoria said. Being a mild legar, Cobra will be focusing on marketing the beer as a life style product and health drink, he said. Nearly 70 million cases of beer were sold in India per annum with strong beer accounting for nearly 70 per cent of this volume.
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Berger kicks off recast
Mumbai: Berger International Ltd, which has been acquired by Asian Paints (I) Ltd, has embarked on a major restructuring drive with emphasis on cost reduction. In an effort to improve the group’s performance, the company has borrowed a sum of $23 million from commercial banks at a much lower rate of interest backed by a corporate guarantee from the holding company, Asian Paints. As a result of this refinancing, a net saving of interest to the tune of $0.9 million is expected to be realised in the next 12 months. Jalaj Dani, chairman, Berger International Ltd, said, "In the last eight months, the emphasis has been on reducing cost. Various initiatives undertaken in this direction, are beginning to yield results." He added, "We are still continuing our efforts to reduce costs with particular emphasis on supply chain management, material cost and formulation efficiency. For greater focus, appropriate changes have been made in the organisation structure and all critical positions have been filled across our subsidiaries."
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Indal’s Kochi unit sees solution to power tariff issue at ETRC meeting
Kochi: The Aditya Birla Group’s Indian Aluminium Company (Indal) which closed down its main smelter division here from August 1 owing to steep power bills, has pinned its hopes on the August 28 meeting convened by the Electricity Tariff Regulatory Commission. Sources said the company had made three proposals to the commission. The first was the proposal to allow it to go ahead with the proposal to draw power from Power Trading Corporation (PTC). While PTC was willing to offer power at Rs 2.50 a unit up to Thrisssur via the national grid, the state government and Kerala State Electricity were putting a spoke in the wheel, sources added. The board, which said it was not against Indal drawing power from PTC, was insisting that wheeling charges from Thrissur to the company premises would be 35 paise per unit. Besides, there would be another 42 paise per unit as surcharge. Its transmission loss for wheeling power from from Madakathara in Thrissur was estimated at eight per cent. All these together would jack up the price of a unit by at least Rs 1.30 making the total cost of a unit of power at Rs 3.80. Presently, the company could draw power from KSEB at the rate of Rs 3.50 per unit. Another proposal was to allow Indal to go ahead with its earlier captive power plant plan. The proposal had been lying with the authorities for long, the sources added.
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BPCL in talks to import 1.4-m barrels Iraqi crude
New Delhi: Bharat Petroleum Corporation Ltd (BPCL) will import 1.4-million barrels (0.2 million tonne) of Iraqi Basra light crude oil during September-December. Addressing a news conference here, S Behuria, chairman and managing director, BPCL, said that the company would be importing three million tonne of crude from Saudi Arabia, two million tonne from kuwait, 1.5 million tonne from Abu Dhabi and 0.5 million tonne from Malaysia on government-to-government term contracts for processing at its Mumbai and Kochi refineries during 2003-04. Besides, 2.65 million tonne of crude will be bought on short term tender from the spot market, he said. BPCL CMD S Behuria (left) addressing a press conference in New Delhi on Wednesday "We are in talks with the Iraq’s state oil marketing organisation (SOMO) for importing Basra light crude oil. We expect to get 1.4 million barrels in three cargoes," Behuria added. While two cargoes will be processed at BPCL’s Mumbai refinery, the rest will go to its subsidiary Kochi refinery. "We haven’t yet signed the deal (to import iraqi crude), but this is broadly the quantity Somo has indicated to us," he said, adding, “BPCL will seek at least 1.5 million tonne of Basra light crude during 2004 when the deal comes up for renewal in December."

Earlier this week, Indian oil corporation (IOC) signed an agreement with Somo for importing six million barrels (0.81 m tonne) of Basra light in October-December. Reliance Industries Ltd (RIL) too has contracted over one million tonne of Iraqi crude during the same period. IOC is expected to get three million tonne of Iraqi basra light crude in the year to September 2004. Iraqi Basra light crude is the most preferred crude of Indian refineries as it presents a cheaper alternative to their mainstay imports of Saudi Arabia’s Arab light and medium sour grade Oman. Basra light is normally priced below both.
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Godrej to invest Rs 40 crore in BPO companies
New Delhi: Consumer products major Godrej is planning to invest more than Rs 40 crore in the next 12 months in Business Process Outsourcing (BPO) as part of a major step towards diversification.
Speaking to reporters on the sidelines of a Marketing Summit organised by the Confederation of Indian Industry (CII), Adi Godrej, chairman of Godrej Group said, "Godrej had made investments of about Rs 20 crore in BPO companies in the past year. We are planning to more than double that figure in the next twelve months". Godrej has entered the BPO arena recently and has been investing in companies offering services in this arena. "The companies we are investing in include those offering services in the area of travel, medical transcription and accountancy," Godrej said.
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GNCL in pact with Suzlon for wind farm project
Kolkata: The city-based Gujarat NRE Coke Ltd (GNCL), the largest manufacturer of LAM coke in the non-captive segment in the country, has announced its tie-up with Suzlon Energy for setting up a 1.25 MVA wind farm in Gujarat. The windmill is said to be part of GNCL's concerted efforts towards becoming energy efficient. GNCL will contribute about 30 per cent of the total project cost of Rs 5.5 crore, while the balance 70 per cent amounting to Rs 3.85 crore will be financed by a term loan. According to GNCL sources, the company expects to save in income tax payable this fiscal on the company's profits, which will be exempted in view of the higher depreciation benefit available on the wind farm project. As such, the net cash outflow on account of this project is almost negligible. However, the company will be saving substantially in respect of its power and electricity bills vis-a-vis the outflow of instalment & interest on the term loan to be taken. In addition to this, the company will also be eligible for the various sops offered by the Government of Gujarat to companies generating power using non-conventional energy resources. It may be noted that the company is also in process of initiating steps for the co-generation of power from the waste heat of its chimneys.
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Hi-Tech Carbon to double capacity at TN plant
Chennai: Hi-tech Carbon, a unit of Indian Rayon and Industries Ltd of the Aditya Birla group, is doubling its carbon black manufacturing capacity at its plant at Gummidipoondi, about 50 km from here. The expansion, estimated to cost Rs 80 crore, is expected to be completed by March next, after which the plant's capacity will go up to 80,000 tonnes per annum, according to Anil Kumar, president, Hi-Tech Carbon. He told on Wednesday the expansion, including the working capital requirement, is being funded out of internal accruals. Hi-Tech Carbon manufactures carbon black, which is used in automotive tyres, plastics, paints, pigments and printing ink industries. Carbon black is used as a reinforcing agent in tyres when blended with polymers. Apart from the Gummidipoondi plant, Hi-Tech Carbon has a plant at Renukoot in Uttar Pradesh with a capacity of 70,000 tonnes per annum. Hi-Tech's total carbon black manufacturing capacity is 1,10,000 tonnes per annum. The Renukoot plant exports only 5 per cent of its production and sells the rest in the domestic market. The Gummidipoondi plant, commissioned in 1998, manufactures about 44,000 tonnes per annum against its rated capacity of 40,000 tonnes. It exports half its production and sells the balance in the domestic market, mainly to tyre manufacturers. Along with the expansion programme, Hi-Tech also plans to enter the non-rubber segment - the paints, pigment and printing ink industries, for which the company has set up an R&D centre at the Gummidipoondi plant at a cost of Rs 7 crore to develop products, according to Mr Anil Kumar.
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Essar Oil okays pref issue to ABB Lumus
Mumbai: The board of Essar Oil Ltd on Wednesday approved a proposal to issue equity shares or foreign currency convertible bonds for an amount of up to Rs 1,300 crore on a preferential basis to ABB Lumus, the turnkey contractor for the company's 12-million-tonne refinery project at Vadinar, Gujarat. The board has decided to convene an EGM on September 18 this year for seeking shareholder approval for the same. Wednesday's meeting, which was held to adopt the debt-restructuring proposal agreed to by the lenders to the project, also decided to increase the company's authorised capital from Rs 1,500 crore to Rs 2,000 crore. The board approved the restructuring package subject to seeking certain modifications. Fresh shareholder approval will also be sought for raising $250 million from the international markets for meeting the company's funds requirement.
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Iffco shuts down urea operations in Kalol plant
New Delhi: Skyrocketing international prices of ammonia has forced Indian Farmers Fertiliser Cooperative Ltd (Iffco) to shut down its urea manufacturing operations at Kalol (Gujarat) and divert the entire ammonia produced by the plant to meet the requirement of the cooperative's DAP/NPK unit at Kandla. During 2002-03, Iffco's Kandla unit produced 15.02 lakh tonnes (l.t) of di-ammonium phosphate (DAP), 5.80 l.t of 12:32:16 and 2.80 l.t of 10:26:26, the latter two being complex fertilisers with variable nitrogen-phosphorous-potash content. The plant - which accounts for 26 per cent of the country's DAP production - imports its almost entire requirement of ammonia as well as phosphoric acid. But with import price of ammonia shooting up from about $170 per tonne just a few weeks ago to $238 per tonne as per recent quotes, Iffco has changed tack and decided to source ammonia domestically, from its neighbouring urea unit at Kalol, which produced 3.15 l.t of ammonia and 5.38 l.t of urea last year. "Considering the unreasonable increase in ammonia prices, we have decided to shut down the urea facility at Kalol and operate only the ammonia plant to meet the requirement of the Kandla DAP/NPK unit," said U.S. Awasthi, managing director, Iffco. According to him, demand for DAP/NPK is currently at its peak, following the good monsoon activity in the country and the Kandla unit is also operating at full capacity to meet this requirement. "Any disruption in production is not desirable at this point of time. Already, some production has suffered during the April-May period due to the stalemate prevailing in the finalisation of phosphoric acid prices for the current fiscal. The industry cannot bear the additional financial impact arising from the increase in international ammonia prices and it is therefore in the best interest to shut down our urea plant at Kalol and operate only the ammonia facility to meet the requirement of the Kandla unit. This will hopefully also lead to a reduction in international prices in the coming weeks," he added.
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Bharat Bio gets licence for clot buster drug
Hyderabad: Bharat Biotech International Ltd (BBIL) has obtained manufacture and marketing licence for recombinant Streptokinase, the `clot buster' drug, from the Drug Controller General of India (DGI). Claiming to be the first Indian biotechnology company and second only in the world to manufacture the primary drug for dissolving blood clots through the recombinant technology route, BBIL said the commercial licence was granted by the national regulatory authority last week. By manufacturing Streptokinase indigenously, the costs can be brought down. BBIL's Streptokinase would be much more economically priced compared to the currently imported one. The recombinant version scores over its non-recombinant counterpart on several fronts, the chief among them being its ability to prevent excessive bleeding rapidly, the chairman and managing director of BBIL, Dr Krishna M. Ella, said. BBIL's recombinant Streptokinase is a protein produced from genetically manipulated Escherichia coli. This enzyme is a first line therapy for management of acute myocardial infarction, deep vein thrombosis, arterial occlusion, etc, a company release said. Streptokinase is a plasminogen activator, which is a life-saving drug administered in emergency conditions to save patients with acute myocardial infarction. The Technology Development Board and the Department of Science and Technology provided Rs 30 crore for BBIL's recombinant Streptokinase development project.
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