Hedge funds allowed to register as FIIs
Mumbai: The Securities and Exchange Board of India (Sebi) has allowed four hedge funds to register as foreign institutional investors (FII) category.

These hedge funds comprise, Milan, Italy-based Aletti Gestielle Societa, Toronto-based DGAM Emerging Markets Equity Fund, Karma Capital Management and Blackrock Advisors, which are known for using hedge fund investment strategies, have been granted FII registration by the regulator in recent weeks.

Sources said the regulator was looking at the applicant's track record, general reputation of fairness and integrity and more importantly, whether the applicant was registered by a recognised regulatory authority in other markets.

Sources said, the decision was aimed at making the practice adopted by hedge funds to invest in the Indian markets indirectly through the participatory notes (PN) route less attractive.

Other India-focused hedge funds are India Capital Fund, Atyant Capital India Fund, Boyer Allan India Fund and Avatar India Opportunities Fund. Boyer Allan India manages about $1 billion worth investments in India.
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Hindalco shareholders' approve Rs 2,600 cr pref allotment
Mumbai: Shareholders of Hindalco Industries Ltd (HIL), part of Aditya Birla Group have unanimously approved preferential allotment of shares to promoters up to Rs 2,600 crore to fund its capex programmes.

Post-issuance, the promoters' stake in the company will go up to 36 per cent from the present level of 26.5 per cent, a company spokesperson said.

While the majority of shareholders were supportive of the company's bid to acquire the Canada-based Novelis at the extraordinary general meeting held here, a small number expressed the view that the price sought to be paid for the acquisition was on the higher side.

Group Chairman Kumar Mangalam Birla, however, assured shareholders that the acquisition will catapult the company into the largest flat rolled products producer in the world.
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Short selling allowed in F&O stocks
Mumbai: All the 159 stocks available for derivatives trading will become eligible for the proposed short-selling of stocks in the first phase, Securities and Exchange Board of India (Sebi) Damodaran addressing the press said there were 159 stocks in the futures and options (F&O) segment and to start with short-selling is being allowed in the scrips that are in the F&O segment. At a later stage, short-selling will be allowed in more stocks. The new system of Stock Lending & Borrowing mechanism will be through the stock exchange.
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Large blue chips score over small, mid-cap for FIIs
New Delhi: Foreign Institutional Investors (FIIs), prefer to invest in large blue chips over smaller and madcap stocks.

Out of the total FII inflow into the country last year, the top 100 companies accounted for 80.34 per cent of their investment, while their exposure in the top 150 companies was even more than 88 per cent, according to the National Council of Applied Economic Research.

However, the exposure of FIIs in blue chip stocks has seen a modest decline over the past four years, NCAER said in its latest monthly report.

This implies that not all enterprises have been able to attract inflows, and investments are going mostly into companies with strong fundamentals.

Investments in strong companies means that the threat of capital flight and volatility of flows is smaller than what would have been the case if the investments were in weaker opportunities, it said.
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SEBI to set up separate system for tackling serious market offences
Mumbai: The Securities and Exchange Board of India (SEBI) is planning to set up a separate system to separately handle serious offences in the capital market and is also working on regulation of investment advisors.

The regulator says it wants to ensure that very serious offences in the capital market are dealt with differently from those that are numerically larger but not that significant or disruptive.

It has decided to introduce consent orders for all matters which are pending regulatory action or pending before Securities Appellate Tribunal/courts.

SEBI has appointed a committee to look at expanding the derivatives market which will be headed by Prof Rammohan Rao of the International School of Business, Hyderabad. The committee will decide on what needs to be done to introduce new products and processes for more sophisticated investors.
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Best fund awards received by Indian MFs
New Delhi: Indian mutual funds received as many as 22 awards for best performance across various categories in the Gulf region. Of these the Anil Ambani Group's Reliance MF received the highest number of awards.

Franklin Templeton was named as the overall best fund house by globally acclaimed fund tracking firm Lipper Inc among all the mutual fund companies doing business in the Gulf region, while HDFC was selected as best company in the mixed-assets categories in terms of three-year returns.

Reliance MFs have bagged best fund awards in 6 categories, while the country's largest fund house ICICI Prudential managed to get just one award.

Franklin Templeton grabbed the second slot among Indian funds with five awards, followed by HDFC and UTI with three each and DSP Merrill Lynch and Birla Sunlife MF getting two awards each.
The awards were presented at Lipper Fund Award Gulf 2007 ceremony in Dubai late on Monday night, criterion for which was to recognise best performing funds registered for sale in the Gulf States.
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Magma Leasing to raise $15 m via private placement
Mumbai: Leading non-banking finance company Magma Leasing said that the board has approved placement of $15 million (approx Rs 65 crore) of Redeemable Preference Shares to The Netherlands Development Finance Company (FMO). The fresh investment, as per RBI guidelines, would be treated as Tier-2 capital in the firm, Magma informed the BSE.

This follows an earlier investment of Rs 21 crore by FMO in preference shares of Magma during February 2006, it added.
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