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Indian corporates refute Volcker allegations
New Delhi/Mumbai: Indian companies named by the Paul Volcker committee in its report on the UN's oil-for-food programme for Iraq have denied indulging in illegal activities while being part of the project.

Cipla, Ajanta Pharma, Ranbaxy, Godrej & Boyce, Reliance Industries, Tata International, Indian Oil Corporation and RITES Ltd are among 130 Indian companies that have been named by the report.

The report says that these firms made payments of US$22mn while executing contracts worth US$425mn. The report categorises these payments as after-sales service fees and inland transportation fees.

Meanwhile the Confederation of Indian Industry, actively involved in reconstruction activities in Iraq, has decided to talk to its member companies on the issue. CII Director-General N Srinivasan said, "We will talk to those companies in the list which are members of the CII and get their side of the story."

Executives of both Reliance Industries and IOC said the companies had purchased oil from Iraq under the programme but denied that they paid "commissions". RIL said it was probing the allegations and would issue a statement later. IOC and RIL lifted 42.5 million barrels and 2.8 million barrels of crude oil, respectively, under the programme.

RITES said it executed two small-value contracts under the UN programme, and denied that the independent inquiry committee, headed by Paul Volcker, former chairman of the US Federal Reserve, contacted RITES for its version.
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Assocham study: Rising manpower costs eroding net profits
New Delhi: According to an analysis of Q2 results of 100 companies by Assocham Eco Pulse (AEP), while the net profit and total income of India Inc. is growing at a rate of 18% and 20% respectively, manpower cost is rising much faster, at 22%.

During Q2, the IT and ITeS sectors witnessed the maximum rise in staff expenses, which went up by 36%, against the net profit growth of 29%, and growth in total income by 30.5%.

India's largest software company, TCS, registered a striking staff cost growth of 133%, as compared to a top line and bottom line growth of 28% and 60% respectively. Satyam Computers recorded a staff cost growth of 39.24%, as compared to a net profit growth of 25.7%. Geometric and Flextronics software recorded a 35% and 29% increase in staff costs, respectively.

The pharmaceutical sector registered the lowest growth in staff cost at 13%, but its average net profit showed negative growth, at 29%. With increased spending on R&D, the pharma sector is witnessing a rise in expenditure on manpower.

The automobile sector registered a staff cost growth of 15%, as compared to a 31% growth in net profit.

Financial services and banks also came under huge pressure of increased manpower cost, which went up by 22.4%, as compared to their net profit, which dropped by 2%. Expanding retail business and increased competition led to a high growth in manpower cost.
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BHEL and Alstom in technology transfer agreement for supercritical boilers
New Delhi: State-run Bharat Heavy Electricals Ltd (BHEL) has entered into a technology transfer agreement with French power major Alstom for design and manufacture of large-size supercritical boilers, a move that would enable the PSU to undertake 800 MW power projects.

The agreement with Alstom includes transfer of technology to BHEL for any size of Once-Through Boilers and associated coal pulverisers, the company said in a release.

"During the period of agreement, Alstom will provide training to BHEL engineers in the design, engineering, manufacturing, assembly, testing, erection, commissioning, repair, retrofit and upgradation of the boilers," BHEL said.
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Maruti to increase production of Swift by 30 per cent
Mumbai: India's biggest car maker, Maruti Udyog Ltd, has said that it intends to increase production of its recently launched hatchback, Swift, by 30 per cent in order to meet growing demand.

Maruti, 54.2 per cent held by Japan's Suzuki Motor Corp, would produce 6,500 units of Swift cars from November, up from 5,000 a month till now, a statement from Maruti said.

It has already sold more than 27,000 units of Swift since its launch five months ago.

Maruti is also planning to launch diesel-run cars in 2007, an area where rival Tata Motors Ltd has a head start.
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Ratan Tata: Rs.1-lakh car to enter market in three years
New Delhi: Tata Motors will roll out its Rs1-lakh car in the next three years.

According to Tata group chairman Ratan Tata, ''(the car) will be smaller and will be produced in larger volumes, with all the high-volume parts manufactured in one plant... Targeting the larger part of the income pyramid is an important part of what Tata will be doing,'' the 67-year-old corporate honcho said in an interview to McKinsey, a consultancy firm.

The other cost-cutting devise relates to intensive use of plastics on the body of the car and eliminating the margin of the dealers.

''We're also looking at more use of plastics on the body and at a very low-cost assembly operation, with some use of modern-day adhesives instead of welding,'' he said.

''The car is in every way a car, with an engine, a suspension, and a steering system designed for its size.''

Tata said the small car will meet all the emissions requirements. ''We now have some issues concerning safety, mainly because of the car's modest size, but we will resolve them before the car reaches the market, in about three years' time.''

Tata said in view of the socio-economic dimension in manufacturing the car, the company was looking at small satellite units, with very low break-even points, where the cars would be assembled, sold, and serviced.

''We would encourage local entrepreneurs to invest in these units, and we would train these entrepreneurs to assemble the fully knocked-down or semi-knocked-down components that we would send to them, and they would also sell the assembled vehicles and arrange for their servicing,'' he said.
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SC asks TISCO to go ahead with steel plant in Orissa at own risk
New Delhi: The Supreme Court has allowed TISCO to go ahead with its ambitious Rs15,400 crore mega steel plant project at Dubri in Jajpur district of Orissa which was unable to take off because of the dispute on land allotment with the Kalinga Power Corporation Ltd (KPCL).

While allowing the Tata Group company to construct the six-million-ton plant, a court bench headed by Chief Justice R C Lahoti said the steel company could commence its project at the disputed site at its risk subject to the outcome of the petition pending before it.

KPCL has filed a petition before it claiming right over the 1,000 acres land alloted to Tata Iron and Steel Company (TISCO), which was originally given to it in 1994 and was later cancelled arbitrarily by the Orissa government.
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Corporate results: Sundram Fasteners, Madras Cements, Gridco, Gujarat Industries Power, Hindware

Sundram Fasteners H1 net up at Rs.31 crore
Sundram Fasteners Ltd has recorded total sales of Rs577.79 crore (Rs486.31 crore) for the half year ended September 30.The net profit after tax for the period was Rs31.06 crore (Rs26.34 crore). The company has declared an interim dividend of Rs0.85 per share (of face value Rs1 each), or 85 per cent.

"Operating margins during the period were under strain due to continuous pressure on domestic selling prices, and steep hike in the cost of inputs, especially steel and petro products. The pressure on margins is likely to remain during the rest of the financial year," says a press release from the company.

Interest expense for the period was Rs7.39 crore (Rs3.19 crore) on account of increase in interest rates and higher borrowings. Exchange loss on foreign currency loans amounted to Rs2.99 crore (Rs9.09 crore). Profit before depreciation was Rs60.51 crore as compared to Rs50.80 crore during the same period last year.

Depreciation for the period was Rs3.01 crore (Rs11.26 crore). Provision for taxation including deferred tax and Fringe Benefits Tax was Rs16.44 crore (Rs13.20 crore).

Operating expenses, including excise duty, were at Rs507.42 crore (Rs423.80 crore).

Export sales for the period increased by 27 per cent to Rs155.33 crore (Rs122.23 crore).

Madras Cements net jumps 44 per cent
Madras Cements Ltd has reported a 44 per cent jump in net profit and a 25 per cent increase in sales for the quarter ended September 30, 2005 over the previous corresponding quarter.
The board of directors has recommended an interim dividend of Rs5 a share (50 per cent).

Its profit after tax for the second quarter of 2005-06 was Rs18.81 crore on net sales of Rs246.09 crore compared to a profit after tax of Rs13.08 crore on sales of Rs196.05 crore for the second quarter of last year.

For the first half of this year, the company had a net profit of Rs36.87 crore on sales of Rs465.96 crore compared to a net profit of Rs30.21 crore on sales of Rs371.08 crore for the corresponding period last year.

Gridco net up at Rs.349 crore
Grid Corporation of Orissa (Gridco) has earned a net profit of Rs349 crore with a total sales turnover of Rs2844 crore during 2004-05.

"If this trend continues, Gridco can wipe out its accumulated losses soon," chairman and managing director Suresh Mohapatra said. Accumulated losses, which stood at Rs 1,787 crore on April 1, 2003, had been reduced to Rs1,028 crore in two years.

Gridco had earned a net profit of Rs411 crore during 2003-04 and presently had the highest turn over among the state public sector undertakings, he said.

Guj. Ind. Power net dips 25 per cent
Gujarat Industries Power Company reported a 25.29 per cent dip in net profit at Rs24.22 crore for the quarter ended September 30, 2005, as compared with Rs32.42 crore in the year-ago period. Total income has decreased 4.64 per cent to Rs196.17 crore from Rs205.73 crore in the same period last year.

Hindware net up 93 per cent
Hindustan Sanitaryware has posted an increase of 92.67 per cent in net profit which stood at Rs10.25 crore for the second quarter ended September 30, 2005, as against Rs5.32 crore during the corresponding period last fiscal.

Gross sales increased by 35.88 per cent to Rs99.95 crore from Rs73.56 crore earned during the same period last year, a company statement said.

Operating profit surged by 55.81 per cent to Rs19.32 crore as against Rs12.40 crore earned last year, it said. In the first half of 2005-06, net profit stood at Rs17.23 crore, an increase by 82.71 per cent from Rs9.43 crore in the same period last fiscal, the statement added. Gross sales increased by 37.87 per cent to Rs193.61 crore up from Rs140.43 crore of last fiscal's first quarter.
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