Rupee gains marginally
Mumbai: The rupee marginally gained against the dollar on Friday on the back of inflows into the market. The rupee currency opened at 44.60/62 and slipped to 44.65. It finally closed at 44.61/62, down from 44.69 on Wednesday.
Forwards-In the forward premia market, the 6-month closed at 2.05 per cent (1.87) and the 12-month at 1.85 per cent (1.74).

Bonds: The bond market ended the last day of the fiscal on a weak note with the prices of some G-Secs touching levels last seen in May 2005, said dealers. There was lack of interest among market players to take fresh positions, as it was the last day of the financial year.

G-secs: The 8.07 per cent-11-year-2017 paper opened at 103.95 (7.53 per cent YTM), touched a low of Rs103.7 (7.55 per cent YTM), and closed at Rs103.9 (7.53 per cent YTM). The 9.39 per cent-5 year-2011 paper opened at Rs109.1 (7.27 per cent YTM), touched a low of Rs108.8 (7.33 per cent YTM), and closed at Rs108.96 (7.3 per cent YTM) against the previous close of Rs109.27 (7.23 per cent YTM).

Call rates: Call rates ended at 6.75-7 per cent against Wednesday's close of 6-6.2 per cent.

Repo auction: In the three-day reverse repo, under the liquidity adjustment facility, RBI received and accepted five bids, amounting to Rs2,305 crore and 12 bids amounting to Rs8,470 crore in the repo auction. In the second auction, the central bank accepted 10 bids for Rs3,275 crore through the reverse repo and five bids for Rs1,140 crore through the repo auction.

CBLO: The CBLO market saw 284 trades, aggregating to Rs14,391.90 crore in the rate range of 3.05-7.1 per cent.
Back to News Review index page  

STPI units to be given IT sops
New Delhi: According to the Finance Ministry, Software Technology Park of India (STPI) units should not be denied tax exemption under Section 10 A of the income-tax law merely on the grounds that approval to such units have been granted by the directors of the STPIs and that such parks have not been approved by the Central Government.

The Central Board of Direct Taxes (CBDT) has given instructions to this effect to its field formations but it has made it clear that deduction under Section 10A would be subject to fulfilment of all other conditions spelt out in that provision.

For cases where assessments have already been completed and the claim under Section 10A has been disallowed only on the grounds that the approval to the STPI has not been granted by the Inter-Ministerial Standing Committee, the Finance Ministry has now said that the demand so arising should be kept in abeyance until further orders.

Section 10A of the income-tax law provides for 100 per cent deduction for 10 years of export profits derived by units set up in any STPI. The STPI scheme notified in April 1995 by the Commerce Ministry required approval of the STPI by the Inter-Ministerial Standing Committee of the Department Of Electronics.

However, a large number of units have been registered or approved only by the STPI directors and were claiming deduction under section 10A.

The IT industry has termed the CBDT's move to streamline the tax exemption regime for STPI-registered software units as a welcome move.
Back to News Review index page  

GE Money to finance Motorola handsets
New Delhi: GE Money and mobile handset major Motorola have tied up for a handset financing deal according to which GE Money will finance the purchase of high end Motorola handsets at zero per cent interest rates. This will enable consumers to buy mid and high-end Motorola handsets at monthly instalments.

"This is the first time that a finance company and a handset manufacturer have allied to offer zero per cent mobile handset financing to consumers. To begin with the facility will be available in 10 major cities through 200 Motorola dealers," said Allen Burnes, corporate vice-president, Motorola.

Vishal Pandit, president and CEO of GE Money, said the company would be offering up to 75 per cent of the handset price and for a period ranging between nine to 12 months. Handsets available under the scheme are mid and high-end devices, including six feature rich current models including Motoslim, Motorazor V3 and newly launched PDA phones.

The scheme will be available across 70 major cities across the country by the end of 2006.
Back to News Review index page  

Chidambaram tells PSBs to consolidate
New Delhi: The Finance Minister, P Chidambaram, has exhorted public sector banks to consolidate operations. Inaugurating the 2,000th centralised core-banking solutions (CBS) branch of Punjab National Bank (PNB) in the Capital, Chidambaram said,"Consolidation will make Indian banks stronger. If computerisation, competition, convergence have not posed a threat to you, then consolidation should also not pose a threat. I am willing to wait. I want you to embrace consolidation and convergence as you did embrace computerisation," Chidambaram said.

Mr Chidambaram said that PNB would become a giant bank dominating the northern States if consolidation were to take place. He highlighted that PNB, after consolidation, would become as big as State Bank of India (SBI) and would give the latter a run for its money.
Back to News Review index page  

PNB plans buyout
New Delhi: Punjab National Bank (PNB) is working on acquiring a strong bank to propel its growth and is eyeing banks with business size of over Rs25,000 cr - Rs30,000 cr.

In terms of size we are looking at banks with business size of over Rs25,000-30,000 crore," said S C Gupta, chairman, PNB said. The earlier proposal to merge IFCI with PNB has been put on the back burner.

Gupta said PNB was keen that their should be synergy in terms of employee rationalisation and technology. "We would need more and more capital and the acquisition should not be a drain on bank's resources," Gupta added. He did not specify anytime frame for the acquisition.

On being asked if there was a branch network size that the bank was looking for, Gupta said," We are not averse to bank with a branch size of 200-250."
Back to News Review index page