Rupee ends lower
Mumbai: The rupee though remaining range bound for the major part of the day ended lower as exporters booked profits. The rupee opened lower at 46.85/86 and touched 46.98 on dollar buying. It recovered towards the close due to intervention by the Reserve Bank of India, said dealers.

Dealers said traders were waiting for tomorrow's quarterly monetary review and have factored in a 25-basis point hike.

Forwards: The forward premia were steady with the six-month premium closing at 1.01 per cent (0.87 per cent) and the one-year closing at 1.13 per cent (1.1 per cent).

Bonds: Bond prices inched up as a reaction to the postponement and reduction of the Government securities auction, which will now be held on July 27.

Call rates: The call rate was unchanged at 5.75-5.85 per cent.

Reverse repo: In the first one-day reverse repo auction under LAF, the Reserve Bank of India received and accepted 24 bids amounting to Rs23,860 crore and in the second one-day reverse repo auction, 26 bids for Rs13,165.

CBLO: The CBLO market saw 305 trades aggregating Rs17,611.55 crore in the 5.40-5.80 per cent range.
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Industry survey optimistic about Q2
Mumbai: Ahead of its monetary policy review, the Reserve Bank of India's (RBI) has released its latest industry outlook survey, as a part of the central bank's first-quarter review of macroeconomic and monetary developments.

The survey has suggested further improvement in the overall business environment, including profit margins, during July-September 2006. The RBI said its survey respondents expected the financial situation to show an improvement during July-September, amid corporates increasingly availing of working capital finance.

Industry production maintained its momentum during April-May 2006, with a growth figure of 9.8 per cent. The manufacturing sector, with double-digit growth of 10.9 per cent, remained the key driver of industrial activity, contributing almost 92.5 per cent of growth in the industry.

The buoyancy in manufacturing and services sectors, and the positive business confidence suggested that the recent growth momentum in the Indian economy was likely to be maintained in 2006-07. The RBI has projected a GDP growth rate of 7.5-8.0 per cent for 2006-07.
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SBI to consider rights issue to increase Tier-I capital
Kolkata: State Bank of India is considering a rights issue as one of the ways of increasing its Tier-I capital and has taken its case before the Government, the single-largest shareholder controlling close to 60 per cent. A rights issue will require a big investment by the Government.

The bank has ruled out a merger of subsidiaries, especially because these are already on a common technology platform and follow a similar set of regulations.
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PNB appoints E&Y as consultants for cards biz
New Delhi: Punjab National Bank has decided to sign up Ernst & Young (E&Y) as its consultant for its proposed foray into credit card business.

Ernst & Young will, in the next six months, formulate a business plan for PNB's credit card business and also help the bank in identifying a joint venture partner for the card business. The bank will set up a joint venture subsidiary that would exclusively deal with all aspects of credit card business. Currently, PNB has a co-branding tie-up with HSBC in which the latter is the card issuer and plays the dominant role. Indications are that PNB would withdraw from the co-branding tie-up with HSBC as soon as the new joint venture company takes off.
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SBI, Softbank to set up $100-m VC fund
Kolkata: State Bank of India and Softbank of Japan will set up a $100 million venture capital (VC) fund. SBI's tie-up, through SBI Capital Markets, will lead to a fund aimed significantly at investments in the pharmaceutical sector. This is expected to be followed up by other funds, each with a special focus.

SBI Capital Markets has already underlined the need to enable start-up entrepreneurs with VC support.
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Deutsche Bank reports FY06 net up 63.29 pc
Mumbai: Deutsche Bank has reported a 63.29 per cent rise in net profit from its Indian operations for FY06. The net profit of the bank stood at Rs125.9 crore when compared with Rs77.1 crore, in FY05.

Its total income in FY06 was Rs1,164 crore, up 45.82 per cent from 798.2 crore a year earlier.

The interest income from the German bank's Indian branches increased 55 per cent to Rs603.7 from Rs390.1 crore. Interest expenses however, showed only a marginal increase to Rs368.2 crore from Rs304.7 crore a year earlier. Its net interest income was Rs213.6 crore.

The deposits of the bank, which began retail banking operations earlier this year, increased 23.10 per cent to Rs4,379.8 crore from 3,557.8 crore. Its advances marginally increased to Rs2,581.7 crore at the end of March 2006 from Rs2,540 crore a year earlier.
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IDFC Q1 net profit up 20 pc
Mumbai: Infrastructure Development Finance Company (IDFC) has reported a 20 per cent increase in net profit at Rs131 crore for the first quarter of the current fiscal, as against Rs109 crore in the corresponding quarter of last fiscal. The gross approvals during the quarter reached Rs2,640 crore involving 28 projects (Rs1,911 crore), reflecting an increase of 38 per cent. The gross disbursement was Rs1,332 crore (Rs778 crore). While the net interest income from infrastructure loans during the quarter was Rs108 crore, the net interest income from treasury operations was Rs6 crore.
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Inflation remains with forecast range: RBI
Chennai: The Reserve Bank of India in its first quarter review of Macroeconomic and Monetary Developments said inflation remained within the indicative trajectory during the first quarter of fiscal 2006-07 despite higher oil and food prices. The RBI had indicated in its Annual credit policy in April 2006 that inflation would be in the 5 - 5.5 per cent range.

The wholesale price inflation was 4.7 per cent on July 8, 2006 as compared with 4.5 per cent a year ago. Consumer price inflation was at about 6.4 per cent at the end of May 2006.

The report said that while core inflation (i.e. rate of inflation excluding food and oil prices) and inflation expectations had so far remained benign, both had started edging up in recent months. High oil prices had forced several central banks to tighten their monetary policies recently. The report indicates that oil prices are expected to remain firm (probably closer to $69 per barrel).
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