Grand hotel group scouting for property in London
Mumbai: The Grand group of hotels is on the look out for a suitable property in London. "It will be an outright purchase," Lalit Suri, chairman & managing director of the group, said here on Tuesday. He declined to estimate the likely investment or specify a time frame for the acquisition, but confirmed West End as likely location. "We are not looking at a big hotel, about 200 rooms," he said. Targeted return on investment is 10 per cent.

In similar plans elsewhere abroad, he said an earlier property managed by the group in Dubai has emerged as candidate for prospective joint venture. On the domestic scene, Mr Suri who owns seven properties, four of them managed in league with Intercontinental, said, he will be bidding under the disinvestment process for the Centaur, Delhi and the Ashoka, Jaipur.

Suri is upbeat on prospects for the hospitality sector, describing occupancies across major cities as choc-a-block. In a brief conversation at `Intercontinental The Grand', a new hotel from his group in the North Mumbai region, Mr Suri said the sector must "forget Average Room Revenue of $250" (approximately Rs 11,480) and reconcile itself to figures in the range of $100-$150 (approximately Rs 4,592-Rs 6,880). Though this reality was portrayed as relevant to major cities, North Mumbai area in particular had seen a sudden onset of hotel rooms, causing a crash in room rates.
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Castrol in talks with RIL, EOL to sell lubes
Mumbai: Castrol India Ltd (CIL) has entered into talks with Reliance Industries Ltd (RIL) and Essar Oil Ltd (EOL) to sell its lubricants through their petrol pumps. CIL is in talks with the two private players since they do not have any interest in the lubricants segment and are planning a large number of retail outlets in the near future. Commenting on the development, Ravi Pisharody, director-marketing, CIL, said that details such as revenue-sharing arrangement and the tenure of the agreements are being worked out. "The tenure of the agreement would be about two to three years," he added.

A formal agreement with EOL is believed to be round the corner. "We have not yet finalised the agreement with Castrol, but we expect the agreement to be a long-term synergistic tie-up," an Essar spokesperson said. The focus of the agreement will not be on revenue sharing but on promotions and synergistic marketing efforts, which would be done jointly by Castrol and Essar, he added. CIL's range of lubricants is already available at the three petrol pumps launched by EOL and would be extended to others as and when they are rolled out. At present, CIL sells its lubricants through the bazaar route. Mr Pisharody added that it hopes to increase sales of its lubricants by about five per cent over the next couple of years once the lubricants are made available at these petrol pumps. The ratio of lubricants sold through the bazaar and the petrol pumps stands at 70:30. While EOL is planning 1,700 petrol pumps, RIL is planning 1,500 petrol pumps in the first phase. The first petrol pump of RIL is expected to be launched in the first half of next year. Castrol, which has a presence in the Indian market for over eight decades, sold about 13,000 million litre of lubricants last year. The company is leveraging the power of its two brands Castrol and BP.
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Timex eyes 25% operating profit margin
New Delhi: Following the approval of its financial restructuring scheme (FRS), Timex Watches Ltd, a group company of Timex Corporation USA, is aiming to secure operating profit margins of 25 per cent in calendar year 2004 and emerge as a dividend-paying company by fiscal year March-ending 2005. The Indian subsidiary's FRS was approved by Delhi high court on November 5, 2003. As per the FRS, Timex' entire cumulative losses of Rs 127 crore, including net loss of Rs 19 crore in fiscal '02-03, have been wiped out against its networth. Post-FRS, Timex' paid-up equity capital comes down to Rs 10 crore from Rs 40 crore when the firm was established in 1993. Timex sources said that the company's paid-up capital of Rs 10 crore was adequate enough to make a fresh beginning as it had no capex investment plans for next two years. Timex's last capex was in 1996 when it invested Rs 18 crore towards the setting up of a case plant at Noida near New Delhi.

As a preparation for FRS, the company had earlier retired its high-interest debt from Hong Kong and Shanghai Corpora-tion Bank (HSCB) with the parent company's three-year ECB (external commercial borrowings) of $10 million. The company will now service parent company's ECB at an interest rate of two per cent against 7.65 per cent for HSCB. The new arrangement will give Timex savings of 5.5 per cent on $10 million, which is around Rs 2.5 crore a year. The savings are expected to be bolster its botttomline. "We're beginning with a clean slate," said a high-ranking Timex executive. "The shareholders have decided to take a write off on our entire cumulative losses," added.

The Timex source added, "We hope to secure operating profit margin of 25 per cent in the year 2004 - for the last 18 months we've been posting operating margins of around 20 per cent." Post-FRS, Timex will operationally break-even in March-ending fiscal '03-'04 and emerge as a dividend-paying company in '04-'05. Around 15 per cent of the equity is currently with the public while the remaining with Timex.
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Mudra Comm bags Electrolux account
New Delhi: Electrolux Kelvinator Ltd (EKL) has ended the sweepstakes for its Rs 40 crore advertising account and appointed Mudra Communications to handle the brand. Mudra Communications will develop advertising campaigns for the company's entire product range. "Mudra's extensive experience in the industry and their outstanding track record of developing strategies for a number of leading brands were important considerations during the selection," said Sanjeev Wadhwa, GM (marketing), Electrolux Kelvinator.
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Sanmar Properties to merge with Chemplast
Chennai: Chemplast Sanmar has informed the stock exchanges of its decision to amalgamate Sanmar Properties and Investments Ltd with the company. Prior to the amalgamation, SPIL would de-merge its investment and shipping businesses into a separate company, Sanmar Holdings Ltd.

After this move is completed, SPIL would receive equity shares of Chemplast Sanmar in the ratio of one share of Chemplast for every one equity share held by them in SPIL. "The Amalgamation would provide Chemplast with a resource base which would put it in a comfortable position to implement its new projects under consideration," says the company's notice to the stock exchange.
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IVRCL net rises
Hyderabad: IVRCL Infrastructures & Projects Ltd posted a turnover of Rs 193.09 crore and a net profit of Rs 7.08 crore for the quarter ended September 30. The company recorded a 138 per cent growth in turnover and 155 per cent increase in profit when compared to the turnover of Rs 81.10 crore and profit of Rs 2.77 crore registered during the corresponding period in the previous year.
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Open offer for 36.42 pc of SRF Polymers
Mumbai: Stratcap Securities India Pvt Ltd has informed the Bombay Stock Exchange that it has (on behalf of Narmada Farms Pvt Ltd and Bhairav Farms Pvt Ltd (the acquirers) entered into a share purchase agreement with Mr T.V. Narayanaswamy to acquire 1,54,264 fully-paid equity shares of SRF Polymers Ltd (representing 2.39 per cent of the voting capital of SRF Poly) at a price of Rs 40 per share payable in cash.

With the proposed acquisition, the promoter group would cumulatively acquire 4,76,835 equity shares (representing 7.39 per cent of the voting capitalof SRF Poly) in fiscal 2003-04. The acquirers are making an open offer to the public shareholders of SRF Poly to acquire 23.5 lakh fully-paid up equity shares (representing 36.42 per cent of the voting capital) at Rs 40 per fully paid-up equity share. The specified date is December 8, 2003. The offer opens on January 5, 2004 and closes on February 3, 2004.
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Tata postpones Indigo Station Wagon, Indica Sport launches
Pune: Vehicle manufacturer, Tata Motors, has postponed the launch of its Indigo Station Wagon and Indica Sport variants, both of which are ready for launch having completed extensive trial testing. Top company sources told Business Line the company has decided to freeze plans for any new platform or variant till it is able to ramp up production at its facilities to meet the demand for existing vehicles. Sources said the company's supplies of its popular mid-segment offering, the Indigo, to the national market has been affected over the last month with dealers across western India seemingly the most affected with waiting list of 5-6 weeks at some locations. The shortage of supplies has also hit the petrol model of the Indica. While company officials refused to comment, sources said production of the Indigo has slowed down over the last couple of months with the company now stepping up production of the CityRover model for MG Rover , UK.Tata Motors will supply one lakh units of the car to MG Rover the next five years.Sources attributed the shortage in supplies of the Indigo and the Indica petrol to the fact that the company is now diverting most of the petrol engines available with it towards production of Rover vehicles.

The company is now manufacturing around 10,000 vehicles every month of which between 1,500-2,000 units are the models being supplied to Rover.For the company's dealer community the glitch in supplies comes as a double whammy. At a time when car owners are trying to upgrade and first time buyers aspiring to directly opt for a larger car, they find themselves without stock of the Indigo which is the most affordable option in its segment. "Customers now come into dealerships with impatient feet and don't hesitate to opt for another brand since they don't like waiting to take possession of a new car,'' sources said. The irony for the dealer community also comes from the fact that sales of the petrol Indica had increased significantly over the Dassera-Diwali period as a result of an intensive promotional campaign they undertook in collaboration with the company. With the results of the campaign now translating into sales, the dealers find themselves unable to fulfil the demand for the same thanks to inadequate supply from the manufacturer.

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