The Reserve Bank of India left benchmark interest rates untouched in its quarterly credit policy statement, released today. That was as expected. But RBI Governor D. Subbarao, has made it clear that once clear signs of a recovery are evident, and if prices are ruling higher, the RBI will move swiftly to hike rates. At present, it is holding back pre-emptive action, to give room for consumers to borrow and buy and thereby generate demand for industries to grow. Continue Reading →
Economy+Policy
Mini-Budget 2009-10 for the real estate industry
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Companies
Sanofi Aventis to acquire Shantha Biotech, deal valued at 550mn euros
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Sanofi Aventis is acquiring the 80% stake that Merieux Alliance held in Indian vaccine company Shantha Biotech. The Hyderabad-based 90mn euro (Rs 620 crore) turnover company makes vaccines and its flagship product, a hepatitis-B vaccine Shanvac-B brought it fame. The company says this is India’s first WHO-Geneva pre-qualified vaccine. It also makes other vaccines including those used in inoculation of infants.
Economy+Policy
Sebi kills shares with differential voting rights?
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Sebi has introduced a new rule that will effectively kill the desire of companies to issue shares with differential voting rights. The capital market regulator has made a small amendment to the listing agreement that has a wider impact. It has said that a company shall not issue shares that have either superior voting rights or higher dividend entitlements, compared to the ordinary shares listed on the exchange. The rule is effective from July 21, 2009.
Companies
Reliance’s refining business drags down profits
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Reliance Industries chose to focus on margins rather than improve volumes during the June 2009 quarter. Its performance was affected by a mix of factors. Export volumes dipped during a period when the rupee depreciated, which would have normally added extra rupees to RIL’s bottom line. The Jamnagar refinery voluntarily gave up its export oriented tax status as it wanted to focus on the domestic market. Gas production from its KG basin started, contributing to sales and profits, but also upped its depreciation outgo. Continue Reading →
Companies
Other income boosts United Breweries’ net profit
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United Breweries, a company that sells Kingfisher beer, did well on the sales front but operating margins dipped in the June 2009 quarter. The company’s sales during the quarter grew by 17.2% to Rs 556 crore. The company, which sold Rs 1,700 crore worth of the liquid in 2008-09, said that it sold 12% more beer during the quarter over the corresponding previous period, twice the industry average. Strong beer sales grew by 25%.
Companies
Bharti Airtel’s performance dented by rising costs and capex
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Bharti Airtel’s results tell a different story, based on whether you compare it with the previous quarter or June 2008. Its performance seems to have improved compared to March but has deteriorated when compared to a year ago. It does appear that Bharti’s operating performance in 2009-10 will be lower, compared to the previous year.
Companies
Wipro stays true to forecast, hikes September guidance
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Wipro’s performance in the June 2009 quarter was good, with revenues falling between the range it had given in April 2009. The stock markets, however, seemed to have bargained for more, as the stock is down about 2%. Measured in constant currency terms, IT companies have reported modest performances in the June 2009 quarter, but when you translate them from currencies like pounds, euros and Australian dollars to USD and then to rupees, the effect can be quite significant.
Cement
Ultratech’s Q1 net profit up 58%, volumes up 24%
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Ultratech Cement’s sales and profits during the June 2009 quarter grew handsomely. The company is a subsidiary of Grasim Industries, a Aditya Birla Group company. Its net sales grew by 31% to Rs 1953 crore, and net profit rose by 58% to Rs 418 crore. Several factors contributed to its good performance: volume growth (partly due to new capacity), firm prices, excise duty reduction, lower coal prices and power costs.
Companies
Ranbaxy to sell generic Norvasc in Canada
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Ranbaxy Laboratories will start selling the generic version of Norvasc, a drug sold by Pfizer Inc and is used to treat hypertension and angina (a heart condition). The drug’s generic name is amlodipine besylate. Ranbaxy said that the Canadian market for amlodopine besylate is CAD $456mn or Rs 2014 crore (1CAD=Rs 44.2). Ranbaxy’s launch is thanks to the European pharmaceutical company, ratiopharm of Germany.