IOC to float Rs500 crore bonds towards working capital
New Delhi: The Indian Oil Corporation (IOC) will float Rs500 crore bonds by this month towards meeting its working capital requirements.

IOC officials said that the non-revision of fuel prices had placed a heavy burden on the company's finances and accordingly it was resorting to increased borrowings.

The total borrowing of IOC in a year have shot up by 80 per cent to Rs18,000 crore currently from Rs10,000 crore as of June 2004.
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Mirabaud Cie to launch India-specific fund
Mumbai: Mirabaud Cie, a Swiss-based bank, and the New York-based Neptune Capital Management are jointly planning to launch a hedge fund specifically for India in about eight months. While the fund will initially start with a corpus of $10-20 million, it aims to achieve a target of $100 million.

According to Pierre Mirabaud, Partner Mirabaud Cie and Chairman of the Swiss Banker's Association, the fund will be not be open to the public but will be aimed at foreign investors. The bank already has a $750-million Asia Capital Holding Fund in operation, where the Indian sector accounts for over 20 per cent of the fund's exposure. The exposure has grown from two per cent eight years ago. The fund's investment in India has given a compounded return of 7 per cent over the past 8 years, he said.

In terms of stock markets, Mirabaud said that domestic markets in India are more investor-friendly than the Chinese markets, although acquiring the foreign institutional investor license was a hassle, which should be done away with.
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SBI Caps strategises for IPO market share
Mumbai: Investment banker SBI Capital Markets has initiated a two-pronged strategy for the current fiscal to regain its share in the initial public offering (IPO) market. It intends to expand the network of its retail broking outfit and empanel more foreign institutional investors.

This strategy is expected to strengthen the distribution capabilities of SBI Caps, a subsidiary of State Bank of India, which recently hived off its broking business into a strategic business unit. According to SBI officials the broking unit would open fifty more retail outlets over the next two years. It currently has seven branches.

The company is also looking to expand in the project advisory and knowledge management services segment. The company may even set up a separate division for cross-border projects, as it has evoked a good response, he added. SBI Caps has also entered into strategic alliances with institutions in Bangladesh and Sri Lanka for project advisory functions. These alliances are for 12-18 months and later will be scaled to joint ventures, officials said.

SBI Caps has tied up with Industrial Development Leasing Corporation in Bangladesh for a $50-million water project. In Sri Lanka, it has tied-up with Margin Bank, which is owned by Bank of Ceylon, and is working on two to three projects worth $15-20 million.

SBI Caps has a representative office in the UK and is also looking to expand operations in South East Asia and the US. These offices will be used to tie up with FIIs. For the fiscal 2004-05, SBI Caps posted a net profit of Rs88 crore (Rs63 crore), registering a 40 per cent increase over the previous year.

The company's total income was at Rs174 crore (Rs 138 crore). Fee-based income grew to Rs52 crore (Rs 31 crore), while fund-based income, which includes leasing and hire purchase, grew to Rs41 crore (Rs27 crore).

SBI Caps plans to exit from leasing and hire purchase business in the next two years. Currently SBI Caps is working on the public issues of Bank of Baroda (around Rs1,400 crore), Syndicate Bank (Rs300 crore) and Provogue (around Rs60 crore).
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Jubilant to issue FCCBs for $75 mn
New Delhi: Jubilant Organosys Ltd will raise $75 million through a foreign currency convertible bond (FCCB) issue, which will be listed on the Singapore Stock Exchange.

According to a company statement, the unsecured and zero coupon 5-year FCCB issue has an upsizing option of $25 million. The issue will have a yield to maturity of 6.6 per cent per annum, placed with international investors, it added.

The FCCB has a 50 per cent conversion premium at Rs1,365.32 a share, the statement said.

The company has said that it has already applied for listing the FCCBs on the Singapore Stock Exchange. The proceeds of the issue will be used to fund the capital expenditure for the company's expansion plans, acquisition and any other permitted use, said the company.
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