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India Inc all set for carbon trading
New Delhi: With more than 112 Indian companies, including Hindustan Lever Ltd and Tata Steel, set to trade in carbon credits, India will be offering the largest portfolio of companies from any country that is signatory to the United Nations Framework of Climate Change Convention (UNFCCC). The UN body certifies countries and companies that can trade in carbon credits under the Kyoto Protocol.

These companies are ready with clean technologies to bring down the emission levels of greenhouse gases and sell certified emission reductions (CERs) to developed countries.

According to World Bank estimates, India is expected to rake in US$100mn annually by trading in carbon credits and Indian companies are expected to corner at least 10 per cent of the global market in the initial years.

Globally, greenhouse gas emissions are expected to come down by 2.5 billion tonnes by 2012. According to industry estimates, Indian companies are expected to generate at least US$8.5bn at the going rate of US$10 per tonne of CER.

By 2007, when actual trading will start, the cost of a tonne of CER was estimated to rise to US$45, according to officials.

Under the Kyoto Protocol, developed countries have to reduce emissions of greenhouse gases to an average of 5.2 per cent below the 1990 level, between 2008 and 2012. They can also buy CERs from developing countries, which do not have any reduction obligations, in case their industries are not in a position to lower the emission levels themselves.

According to analysts it is cheaper for developing countries to reduce emissions than developed countries and as a result, buyers are coming to Indian shores, with Brazil and China emerging as two of India's strong competitors.

The World Bank has also purchased CERs from 10 companies. Tata Steel, HLL, Jindal Vijaynagar Steel, Essar Power and Gujarat Flurochemicals Ltd have specially designed projects to take advantage of the opportunity. Bharat Heavy Electricals Ltd is the only public sector firm, which is planning to approach the ministry for approval.

The projects range from cement, steel, biomass power, bagasse co-generation and municipal solid waste to energy, municipal water pumping and natural gas power.

While the ministry has given the host-country clearance, the CDM projects will have to be approved by the executive board of the UNFCCC. Of the 15 projects approved by the UNFCCC so far, four are Indian. These four are: Gujarat Flurochemicals, Kalpataru Power Transmission Ltd, the Clarion power project in Rajasthan and the Dehar power project in Himachal Pradesh.

India is the world's sixth largest emitter of carbon dioxide with its present share in global emissions estimated at 6 per cent.
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Deccan Herald study: Tata Group has highest market capitalisation
Mumbai: According to a study by conducted by Deccan Herald, the Tata group has come to command the highest market capitalisation among various business groups in the country. With as many as 31 listed companies, the Tata's command a market capitalisation of Rs1,50,914 crore as of August 29, says the study.

Following the Tata group is the Mukesh Ambani-led Reliance pack which has three listed companies in Reliance Ind, IPCL and Reliance Industrial Infrastructure which together have a market capitalisation of Rs1,02,423 crore.

The Anil Ambani led Reliance faction with two listed companies in Reliance Energy and Reliance Capital, bears a market capitalisation of Rs19,687 crore. According to the study, this would suggest that if there was no split between the Ambani brothers, the combined market capitalisation would still have been way behind the total market capitalisation of the Tatas.

The Aditya Birla group, headed by Kumar Mangalam Birla, does boast of some highly rated companies like Grasim, Hindalco, Indian Rayon, Ultra tech Cement etc but the combined market cap of all the nine listed companies of this Group works out to about Rs34,500 crore as of August 29, which is well behind that of Tatas and the Ambanis.

This study, however, was restricted to 'business groups' and thus single companies like Infosys, Bharti Tele, Wipro etc., have not been considered. In case of public sector companies, it is the Oil and Natural Gas Commission (ONGC) which commands the highest market cap worth a staggering Rs1,37,966 crore and seems to have the potential to upset the number one ranking held by the Tata group. Incidentally, ONGC has another listed company in its fold in MRPL, which has a market cap of Rs8,900 crore.

An analysis of the Tata group also reveals that it is mainly the top four or five companies which contribute the most to its total market capitalisation. TCS with a market capitalisation of Rs65,000 crore accounts for about 45 per cent of the total market capitalisation of the entire group followed by other heavyweights like Tata Steel at Rs21,250 crore, Tata Motors at Rs17,500 crore, VSNL at Rs10,600 crore and Tata Power at Rs8,300 crore.

Thus the top five companies account for 80 per cent of the total market capitalisation of the Group.
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Reliance Info may raise US$500mn through syndicated loan
Mumbai: Reliance Infocomm, an Anil Ambani group company, is exploring the possibility of raising US$500mn through a foreign currency syndicated loan. According to reports, the company has held talks with international banks to raise this amount. While US$300-350mn of the proceeds may be utilised to refinance earlier debt, the remaining will be for capital expenditure purposes.

Reliance Infocomm is currently an unlisted company. Reliance Infocomm had raised $300m in October '04 through a seven-year syndicated loan.

Bankers feel that the new norms on unlisted firms, which also require these companies to get themselves listed in the domestic market within three years of a GDR/ADR or FCCB issue, are likely to make several issuers look at the syndicated loan market. FCCBs are quasi-equity issues, which give investors the right to convert their bonds into equity at a pre-decided price.
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Reliance Energy to start work on Dadri plant soon
New Delhi: Work will soon start on the 7,480 mw power plant in the special economic zone (SEZ) near Dadri in Uttar Pradesh with the Cabinet clearing the Anil Ambani promoted SEZ proposal last week.

The formal clearance for the Rs11,000 crore-proposal for setting up a 2,000 hectare-multi-product SEZ by Reliance Energy Generation Limited (REGL) had been delayed with the revenue department objecting to the possible tax loss with the power plant being located in the SEZ.

Reliance is planning to develop a generation capacity of 1,400mw in the first stage. The production is expected to start by 2008-09, when gas supplies begins from Reliance Industry Ltd find in the Krishna-Godavari basin. The company had already agreed to a power sale price of Rs2 per unit with the Uttar Pradesh government, company executives said.

Once it becomes functional, the plant will ease Delhi's power troubles as well. The city, at present, buys power at about Rs3.61 per unit during peak hours (5 pm to 11 pm) and at Rs3.10 off-peak.

Tata Power Ltd is planning a 1,000mw plant in Bawana.

The Dadri plant, being in an SEZ, will have direct tax benefits like exemption from the minimum alternate tax, dividend distribution tax and customs duty exemption.
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Wipro acquires land for IT centre at Bhubaneshwar
Bhubaneswar: Information Technology major Wipro has completed formalities for acquiring 26 acres of land to set up its software development centre in the city.

In December last year, Wipro had signed a memorandum of understanding (MoU) with the Orissa government to set up its software development and a BPO services centre here. The centre is expected to employ around 1,500 people. It will be set up at Infocity, an information technology complex on the outskirts of Bhubaneswar.

Work on the first phase of the centre, comprising at least one unit with a capacity of 1,000-1,500 people would start shortly. It would be completed in two years. The development centre would entail an investment of Rs150-200 crore. In the transit period, the company has its commercial production set-up at Fortune Towers, an IT centre set up by the government.

Tata Consultancy Services earlier signed an MoU with the government to set up a IT development and IT-enabled services centre at Infocity. It would employ 1,000 software professionals in the first phase. Software giants Infosys and Satyam have already announced their plans to enhance operations at their respective software development centres in Orissa.

Wipro's development centre would accord Bhubaneswar with a unique distinction of being the only city in the East to have the presence of the "Big Four" - Infosys, Satyam, TCS and Wipro.

Wipro has also asked the government to take up the issue of a direct flight between Bhubaneswar and Bangalore with the centre. The lack of air connectivity between the two cities has held up several IT majors and upstarts, who want to move away from Bangalore.
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Biocon to invest Rs100 crore every year for next few years
Kolkata: Biocon Ltd is looking at doubling its headcount from around 2,000 now to 4,000 within two years, according to Ms Kiran Mazumdar-Shaw, Chairman & Managing Director.

The biotechnology company has also decided to invest around Rs100 crore every year in new initiatives for the next few years, she said during an interaction with newspersons. Ms Shaw was in the city to receive a Lifetime Achievement award conferred by the ICC Kolkota.

According to her, the company is open to the idea of investing in "strategic acquisitions" abroad with special focus on "product-driven technology companies that have good intellectual property."

Biocon is yet to zero in on any specific acquisition in this regard. However, strategic investments have been made in a few US-based companies.

Biocon is also looking at international listings "based on licensing opportunities and if we feel that it can help us generate better value than that what we can get in India."

She presented the case for a strong regulatory authority for the pharmaceuticals industry in India in order to ensure adherence to quality standards. "The industry needs to build a quality profile, or else we will lose out on global opportunities," she said.

The company, which clocked turnover of around Rs750 crore in 2004-05, is hopeful of "double-digit growth" in operations in the current fiscal.

A faster rate of growth would accrue in 2006-07, when the results of several business initiatives that are being taken now will find reflection in the company's balance sheet, Ms Mazumdar-Shaw said.
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