Govt plans to withdraw Companies Bill
New Delhi: It is time for India Inc to unfurl the victory flag, with the Union Cabinet on Tuesday deciding to withdraw the Companies (Amendment) Bill, 2003. A revised Bill that would take into account the concern raised by industry would be introduced "at the earliest". This decision to pull the Bill out of Parliament has been taken due to numerous objections and suggestions received on it from industry association, professionals, institutions and individuals. "On examination of these objections and suggestions, it was decided to withdraw this Bill and introduce a new revised Bill," informed sources were quoted as saying.

The Bill that was introduced in May 2003 drew largely from the recommendations of the Naresh Chandra Committee on corporate audit and governance and the Joint Parliamentary Committee on stock market scam, besides some left over items of the Companies Bill, 1997. Sources said that it was felt that the issue was becoming "very confusing" since further amendments were being proposed to the Companies (Amendment) Bill. The subsequent amendments were being proposed to assuage the feelings of industry. While the May 2003 Bill contained about 174 clauses, the subsequent amendments proposed were upwards of 40.
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Private airlines allowed to fly to Sri Lanka
New Delhi: The government on Tuesday took yet another step in liberalising the domestic aviation regime by allowing the scheduled domestic private airlines to fly to airports in Sri Lanka. The announcement to this effect came as part of a joint statement issued at the conclusion of the three-day visit of the Sri Lankan prime minister, Ranil Wickremesinghe. "With a view to increasing tourist flow and connectivity it was also decided to encourage private scheduled airlines of India, who operate only in the domestic sector at present, to extend their operations to airports in Sri Lanka," the joint statement said.

The move comes almost a decade after the Indian government opened the Indian skies for private sector airlines in 1993. In effect, the announcement means that three scheduled private sector airlines - Jet Airways, Air Sahara and Deccan Air - will be now able to apply to the Government for designated status to fly to airports in Sri Lanka. India also offered to Sri Lanka the facility of operation of daily air services by its designated airlines between Colombo and Delhi, Mumbai, Chennai, Hyderabad, Bangalore, and Kolkata. The Sri Lankan national carrier, Srilankan, operates 45 flights a week connecting eight Indian cities. However, the airline offers a daily service only to Chennai and Thiruvananthapuram.
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Indian Rayon net spurts on Indo Gulf deal
Mumbai: Indian Rayon and Industries Ltd (IRIL) has reported a net profit of Rs 53.59 crore for the second quarter ended September 2003 against Rs 32.38 crore in the year-ago period. However, this net includes an exceptional item of Rs 19.95 crore, which is capital gains accruing out of disposal of its holding in Indo Gulf Fertilizers Ltd. At the profit before tax (PBT) level, IRIL's profit is higher by 20.4 per cent at Rs 48.05 crore (Rs 39.90 crore). This is primarily on better operating efficiencies.

The viscose filament yarn business continues to be a major contributor to the company's earnings along with carbon black and garments business. The company has chalked out a capital expenditure plan of Rs 234.6 crore over this fiscal and the next fiscal. During 2003-04, the capex is at Rs 175.1 crore and for 2004-05, it will be Rs 59.6 crore, Mr Aadesh Gupa, Chief Financial Officer of the company, said. Net sales during the quarter rose 14 per cent to Rs 426.34 crore (Rs 373.29 crore). Higher volumes across the businesses have contributed to improved sales. The rayon division brought in revenues of Rs 96.23 crore, higher by 11 per cent. The company has planned a capex of Rs 70.01 crore on this segment. The garments division has recorded 25 per cent increase in revenues at Rs 112.53 crore. Improved consumer sentiment, new launches and a partial benefit of the festive season have helped the business.
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Reliance Jamnagar refinery unit shut down
Mumbai: Reliance Industries Ltd on Tuesday informed stock exchanges that it has shut down the fluidised catalytic cracker (FCC) unit at its Jamnagar refinery because of leakage. The shutdown is not expected to have "any material adverse impact on the company's performance", the notice added.

All other units of the refinery are operating normally. The company also said that a team of technical experts was assessing the situation and normalcy was expected within two weeks. The leakage was discovered on Monday. According to industry sources, repairing the FCC unit, a primary part of the refinery, may take more than two weeks.
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Hind Motors plans new models next year
New Delhi: Hindustan Motors (HM) is planning to launch a car in the D-segment next year with a new model from the Mitsubishi portfolio. The company also intends to roll out the new generation model of its popular sports utility vehicle (SUV), the Mitsubishi Pajero next year. "We have not decided yet whether the new model introductions will be in completely built unit (CBU) or completely knocked down (CKD) format. It will depend on the volumes. The models would be launched in the next 18-24 months," G Shyam Sundar, vice-president (automobile division), Hindustan Motors, said.

Meanwhile, the company said that it had cut the price of the base model of its premium mid-size car, `Mitsubishi Lancer' by Rs 70,000 to Rs 6.5 lakh (ex-showroom Delhi) to meet growing competition in the segment. The company said that sales had been affected by launches of models from the General Motors and Toyota stable. Sundar added the new price of the base `GL' model without power windows would be offered for two months, and the company would especially be targeting the fleet and taxi operators. The company said the price decrease was also as a result of increasing localisation. The localisation content of the Lancer had increased to 70 per cent from about 27 per cent five years ago.
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Bharat Forge bags orders from Ford, DaimlerChrysler
Pune: Bharat Forge Ltd (BFL), the flagship company of the Rs 2,500-crore Kalyani group, has bagged major orders from Ford and DaimlerChrysler for supplying components for their global car programmes. Announcing this here on Tuesday, Baba N. Kalyani, chairman and managing director, Bharat Forge, said Ford Motor Company of the US had initiated development of crankshaft forgings with BFL. Similarly, DaimlerChrysler has chosen BFL to supply crankshaft and camshaft forgings for its passenger car engines in Germany.

As a part of this multi-year sourcing initiative, the programme has been launched and shipments are expected to commence from mid 2004. The company has also won an order to supply control arm forgings to a global passenger car company in Australia and a new multi-year order to supply steering knuckle forgings to Dana in the US. "The contract for passenger car components is a major breakthrough for BFL and a large new market segment has opened up to grow its business. We have accelerated the installation of the 6,000-tonne press and it is now ready for production,'' Kalyani said.
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Sterlite to raise $50 million via FCCB issue
Mumbai: Sterlite Industries (India) Ltd has approved an issue of Foreign Currency Convertible Bonds (FCCB) for $50 million. The bonds carry a coupon rate of one per cent, payable annually and have a maturity of five years. The issue was arranged and underwritten by JP Morgan. The bonds are unsecured and are convertible at the option of the bondholder into equity share of the company at a conversion price of Rs 1,100 per share.

The bonds are redeemable in October 2008 at 118 per cent of the principal amount, if not converted into equity share earlier. On full conversion of the bonds, a maximum of 2.06 million equity shares of Rs 5 each of the company will be issued. The closing and payment date for the bond issue is October 27. The proceeds of the bonds will augment the long-term resources of the company and will be used for general corporate purpose including the acquisition of and additional stake in Hindustan Zinc Ltd from the Government.
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Timex to replace $10-m term loan with ECB
New Delhi: As part of its strategy to achieve operating break-even by the end of this fiscal, Timex Watches Ltd is planning to replace its existing term loan of $10 million with the external commercial borrowings of the same amount at lower coupon rate. The matter would come up for the approval of the board of directors of the company at the board meeting on October 29.
According to V Wadhwa, vice-president, Timex Watches, the company is paying interest at the rate of about 7.65 per cent on its existing loans.

"We are currently negotiating the new rates, but they will be much lower. In fact, there may be a saving of about 3-4 per cent," he said. Back-of-the-peg calculations show that this might result in substantial savings of about Rs 2 crore for Timex. Timex had recently also charted out a capital restructuring strategy in order to emerge in the black.
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Cummins to source K-38 engines from Indian plant
Pune: Cummins India Ltd (CIL) on Tuesday flagged off the first Cummins K-38 power generation engine made at its plant in Pune. This is the second engine being sourced from the Indian plant, the first being the V-28 engine. Talking to presspersons, Joe Loughrey, president (Engine Business), Cummins Inc, said the annual global demand for K-38 is estimated at 300 engines and the value of the annual order is over Rs 45 crore. Demand for this product is generated mainly in Africa, the Asia-Pacific, Australia, Europe and the US. He said Cummins Inc had decided to shift its K-38 manufacturing to India from Daventry as India had proved to be a high-quality low-cost manufacturing base.

"This is a strategic move as the engine business is highly competitive and we have to bring down costs," he said. He said Cummins Inc was also evaluating options for more outsourcing from the Indian plant and added that it was also evaluating India as a location for business process outsourcing (BPO). Vinod Dasari, joint managing director, CIL, said the aim was to produce one engine per day as many of the components had to be imported. He said about four engines would be kept in stock at any given point of time. He added that CIL is also looking at becoming a source for the components such as cylinder head, connecting rods and crankshafts for exports. Cummins India, in Pune since 1962, has produced more than 1,67,000 engines to date and manufactures on an average nearly 10,000 engines per year.
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Vesuvius India net up 38%
Kolkata: Vesuvius India Ltd has registered a 38 per cent increase in net profit during the quarter ended September 30, 2003. In the period July-September 2003, the company recorded a net profit of 5.08 crore, up from Rs 3.67 crore recorded during the same period of last year. The company's total income during July-September 2003 stood at Rs 34.50 crore (Rs 27.23 crore), a rise of 27 per cent. The board of directors of Vesuvius India Ltd met here today to take on record the company's unaudited financial results for the quarter ended September 30, 2003.

Speaking to newspersons after the board meeting, Dr S.K. Gupta, chairman of Vesuvius India Ltd, said the refractory maker's growth had been fuelled by the upturn in the domestic steel sector. He was optimistic that the projected growth in the steel sector would continue to drive Vesuvius India's growth as well. Despite the optimism, however, the company has decided not to be entirely dependent on the steel sector and diversify its product range. It has acquired a monolithics plant at Visakhapatnam where unshaped refractories for non-steel applications are manufactured.
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Jindal Stainless eyes $200-m exports
Mumbai: Jindal Stainless Ltd hopes to register exports of $200 million by the close of the current fiscal. It has already exported $94 million in FY04 as against $133 million in the whole of FY03. China is expected to account for over 80 per cent of the exports, South-East Asia, 10-12 per cent and Italy and US, 7-8 per cent. Currently exported as hot rolled-material to China, customers for the company's stainless steel include large tube manufacturers and disparate cold rolling mills.

Jindal Stainless has plans to raise its own cold rolling capacity. For the just ended quarter, Jindal Stainless had reported a 71 per cent rise in net profit to Rs 38.42 crore on total sales of Rs 580.86 crore. The strong trend is expected to continue for the rest of the fiscal. According to Ratan Jindal, vice-chairman & managing director, while increase in raw material prices particularly nickel's saw a price hike in the 300 series stainless steel (which uses nickel) by Rs 7,000 per tonne, input cost gains do not necessarily imply margin pressure because they are passed on to the consumer.
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