Author: PTI

Tata Steel Europe explores potential sale of non-core businesses

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Tata Steel Europe on Tuesday said it is seeking buyers for its non-core business units as the company looks to strengthen its focus on strategic strip products and markets.

Tata Steel Europe has recently conducted a detailed portfolio review of all its businesses to assess the strategic fit and the future potential, the company said in a statement.

“Based on the above review, Tata Steel Europe has begun a process of seeking buyers for business units which supply products to niche markets, allowing the company to continue to strengthen its focus on strategic strip products and markets,” it added.

Outlining the details, the company said the sale process will cover five business units.

These include Cogent (electrical steels maker), Kalzip (aluminium roofing and cladding business based primarily in Germany), Firsteel (which coats steel for kitchen bakeware based in the UK), Tata Steel Istanbul Metals (coil coating company) and Engineering Steels Service Centre.

“As a responsible seller, Tata Steel is committed to seeking the best and most sustainable future for all the businesses,” the statement said.

Hans Fischer, CEO of Tata Steel’s European operations, said these potential sales follow the successful sale of other non-core businesses in recent years, such as Long Products Europe and Speciality Steels.

“Under new ownership, these former Tata Steel businesses have found the focus to secure a more sustainable future. In turn, these divestments have allowed us to focus resources on making significant improvements to the core strip business, as part of our ambition to develop the most sustainable steel business in Europe…” Fischer added.

Fischer noted that the customer bases for the businesses being sold were distinct from the rest of Tata Steel Europe.

“We want to find the best owner for each of these business units who can focus on their needs to help them realise their full potential… These potential sales would enable Tata Steel Europe to focus investment and management resource on its core strip products business and strategic markets,” Fischer said.

Post the potential sale of these business units, which employ a total of 1,100 people, Tata Steel Europe will continue to employ about 20,000 people manufacturing advanced products for the automotive, construction, engineering and packaging sectors.

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Suresh Prabhu seeks early operationalisation of 56 new airports under UDAN

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Civil Aviation Minister Suresh Prabhu on Tuesday said early operationalisation of 56 new airports under the regional connectivity scheme would be among his focus areas.

His remarks also come at a time when nearly half of the 128 routes awarded to various operators in the first phase of the scheme — UDAN — March 2017 are yet to be operational.

Five airlines — Alliance Air, SpiceJet, TruJet, Air Odisha and Air Deccan — had bagged 128 routes connecting over 30 unserved airports under the first phase. UDAN (Ude Desh ka Aam Nagrik) seeks to connect unserved and under-served airports as well as make flying more affordable for the people.

As many as 70 airports, including 31 unserved and 12 under-served ones, were to be connected under UDAN in the first phase.

In a statement, Prabhu said improving passenger amenities, promoting cargo handling facilities and early operationalisation of 56 new airports under UDAN would be his focus areas.

The minister also said that he would be simultaneously working on improving regional connectivity and improving passenger services in a big way.

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Carlyle sells 4.8% stake in PNB Housing for Rs 1,024-crore

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Quality Investment Holdings, an arm of private equity giant Carlyle, today sold 4.8% stake in PNB Housing Finance for Rs 1,024 crore through an open market transaction.

According to bulk deal data available with BSE and NSE, Quality Investment offloaded 80 lakh shares, amounting to 4.8% stake in the housing finance company, for a total of Rs 1,024 crore.

The shares were sold at Rs 1,280 a piece, higher than PNB Housing Finance’s closing price of Rs 1263.55 today.

Meanwhile, General Atlantic Singapore Fund picked up 17.3 lakh shares of PNB Housing Finance for over Rs 221 crore.

As of March this year, Quality Investment held 37.33% stake in PNB Housing Finance, while General Atlantic Singapore owned 8.52% in the company.

Following the deal, the shares fell 8.05% to close at Rs 1263.55 apiece.

The mortgage lender is the fifth largest largest housing finance company with the asset under management of Rs 62,252 crore as on March 31, 2018

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Eyeing opportunities beyond steel also, says L N Mittal

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Looking beyond steel, ArcelorMittal is evaluating opportunities that complement its existing business and asset base, Chairman Lakshmi N Mittal has said.

The world’s largest steelmaker has already inked a pact with carbon recycling company LanzaTech and technology provider Primetals Technologies to construct Europe’s first-ever commercial scale production facility to create bio-ethanol from waste gases produced during the steel-making process.

“ArcelorMittal is the world’s leading steel company… But to maintain this we have to work hard and continually ensure we are evaluating the competitive landscape not just in steel but also in other materials and also taking into account the mega-trends that will shape the future of the economy,” Mittal told PTI.

This is an era of fast-paced times, the steel tycoon said, adding that in the world of manufacturing, continued impact of digitisation will be seen besides that of artificial intelligence.

“Our customers’ demands are continually evolving and we have to stay ahead of that and continually develop our product offering. We are always evaluating opportunities that complement our existing business and asset base,” Mittal said.

Citing the example of company’s plant at Gent in Belgium, Mittal said, they are implementing “an incredible technology” there that will enable it to turn waste gases into ethanol and then sell that ethanol and potentially plastics as well.

At its Dunkirk site, which is the largest in Europe, the company produced close to 7 million tonnes of steel in 2017, and heat recovered at the sinter plant has been feeding the municipal heating network, benefitting 6,000 homes, hospitals and swimming pools.

Due to this, the company officials said, the city avoids 4,50,000 tonnes of CO2 the equivalent of 50,000 people’s yearly CO2 emissions.

Plans are afoot there for large production of bio-ethanol, officials said, adding that the blast furnace slag is recovered and recycled there as it is used in cement.

Talking about the diversification plans of the company, Mittal said, “We have also recently invested in a solar panel technology company as this is a growing market for us. We are very excited about the future and we hope that India will be part of that”.

At present, ArcelorMittal is in the race to acquire debt-laden Essar Steel, currently undergoing insolvency proceedings as it owes more than Rs 45,000 crore to over 30 banks.

The Committee of Creditors (CoC) on May 2 had met representatives of ArcelorMittal and Numetal regarding their eligibility for Essar Steel and a decision is awaited.

Mittal, who has been trying to get a foothold in India for over a decade, has said: “India is important to us. Of course for me personally I would like us to have a presence in my home country…India is a strategic growth market and if you look at steel industry growth then the majority of growth in the coming years is going to come from the developing economies ex China and that includes India”.

He has said under present circumstances there is a strong strategic rationale for the company to establish a presence in India.

ArcelorMittal has presence in 60 countries and an industrial footprint in 18 countries. It is a leading supplier of steel in major global markets.

In 2017, ArcelorMittal had revenues of USD 68.7 billion and crude steel production of 93.1 MT, while its own iron ore production reached 57.4 MT.

It is listed on stock exchanges of New York, Amsterdam, Paris, Luxembourg and Spain.

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Mallya loses $1.55 billion assets case in UK court

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Embattled liquor tycoon Vijay Mallya, undergoing an extradition trial in a UK court over fraud and money laundering charges by Indian authorities, today lost a lawsuit filed by 13 Indian banks in the UK High Court seeking to collect from him more than $1.55 billion.

Judge Andrew Henshaw refused to overturn a worldwide order freezing Mallya’s assets and upheld an Indian court’s ruling that a consortium of 13 Indian banks were entitled to recover funds amounting to nearly $1.55 billion (1.145 billion pounds).

The victory for the banks will enable them to enforce the Indian judgement against Mallya’s assets in England and Wales. The worldwide freezing order prevents him from removing any assets from England and Wales up to that value or to in any way dispose of, deal with or diminish the value of his assets in or outside of this jurisdiction, up to the same value.

The claim brought by 13 Indian banks against the 62-year-old businessman was heard in the High Court last month.

The litigation in the Queen’s Bench Division of the commercial court in England’s High Court of Justice lists the State Bank of India, Bank of Baroda, Corporation bank, Federal Bank Ltd, IDBI Bank, Indian Overseas Bank, Jammu &a Kashmir Bank, Punjab & Sind Bank, Punjab National Bank, State Bank of Mysore, UCO Bank, United Bank of India and JM Financial Asset Reconstruction Co. Pvt Ltd as the applicants.

Mallya and related concerns Ladywalk LLP, Rose Capital Ventures Ltd and Orange India Holdings are listed as respondents.

The claim relates to a judgement of the Debt Recovery Tribunal (DRT) in Karnataka, which concluded that Mallya was “liable” to the banks in the sum of Rs 62,033,503,879.42 plus interest.

The “freezing order” involves Mallya and related concerns being “restrained until further order, from removing from the jurisdiction any of their assets in the jurisdiction up to a limit of 1,145,000,000 pounds and in any way disposing of, dealing with or diminishing the value of any of their assets whether they are inside or outside the jurisdiction up to the same value”.

The UK court had earlier upheld the Indian court’s injunction and given Mallya’s lawyers more time to respond due to the ongoing extradition trial at Westminster Magistrates’ Court in London, which is now set for a hearing on July 11.

Meanwhile, Mallya remains on a 650,000-pound bail bond since his arrest on an extradition warrant by Scotland Yard in April last year.

The Crown Prosecution Service (CPS), representing the Indian government, has claimed that the evidence they have presented confirms “dishonesty” on the part of the businessman, who acquired the loans through misrepresentation and had no intentions of repaying them.

Mallya’s defence team has been deposing a series of expert witnesses to try and establish that the default by Kingfisher Airlines was the result of business failure within a wider context of a global financial crisis and that its owner had no “fraudulent” intentions.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Banks’ corporate loan book may plunge to 27% by FY22 from 39% now

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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With the increased focus on retail loans, revenue share of corporate lending in banks’ overall loan pie is set to come down to just over a fourth by FY22, says a report.

The share of corporate lending in the overall revenue pie will slide to 27% by FY22 from 39% now, consultancy firm BCG said in a report today.

But retail lending will see an increase to 35% from the present 28%, it said.

In FY12, corporate lending contributed 50% of banks’ revenue pool from advances or interest income.

The report attributes this to lingering bad debt issue which has resulted in lower appetite for corporate loans, pressure on margins and also movement away from bank borrowings by the better-rated corporates.

Elaborating on the vexed issue of non-performing loans, it said high corporate NPAs have increased pressure on corporate banking and that it is the large and mid-corporate segments which have been hit the most.

There is also an increase in the fraud instances with banks losing Rs 46 crore per day to frauds, it said, attributing it to the Reserve Bank.

The report comes a fortnight after the central bank flagged concerns on the increasing preference to retail loans by banks.

“Retail loan book is not a risk-free segment and banks should not see it as the grand panacea for their problem- riddled corporate loan book. There are risks here too that should be properly assessed, priced and mitigated,” deputy governor N S Vishwanathan had said.

Meanwhile, the BCG report, done in association with the global financial messaging cooperative Swift, said corporate clients are unhappy with banks’ offerings.

“Corporate clients are not satisfied with the current offerings from their bankers,” it said.

The report offers a seven-point corrective action programme, including offering industry-specific solutions, rebooting the relationship manager-based model, exploiting analytics and better pricing.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Dubai’s Relam Investment to invest $300 million in India

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Dubai-based Relam Investment LLC today announced its entry into the Indian market with an initial commitment to invest USD 300 million in the real estate and technology sectors over the next five years.

The company will make India as it’s hub for investments in Southeast Asian markets, its chairman and managing director Sultan Ali Rashed Lootah said.

“We have allocated an investment portfolio of USD 50 million to fund emerging technology companies and another USD 250 million into the real estate sector,” Lootah said, adding the investment will be done over a period of next five years.

The company is investing in three technology companies – Oya, Bricx and T-Hub, according to him.

“In the real estate sector, we would be looking at investment in commercial as well as affordable, energy-efficient and sustainable housing projects,” he said.

The company is open to either invest directly in a real estate project or partner with any domestic company to invest, Lootah added.

Relam Investment LLC, a joint venture between UAE-based Vault Investment and Vietnamese MIG Holding, today also signed a co-operation agreement with Mumbai-based RRP S4E Innovation to set up renewable energy plants in the country.

Besides real estate and technology sectors, the firm will also focus on investments into energy, oil and gas, trading, healthcare, retail and agriculture sectors.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

US dollar ends cheaper against rupee

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The US dollar ended cheaper against the rupee at Rs 67.08/09 per dollar and the pound sterling also finished lower at Rs 90.58/60 per pound at the close of the Interbank Foreign Exchange (forex) market here today.

Following are the Interbank forex and RBI rates :

(In Rs per unit) Unit Interbank RBI Reference US Dollar 67.08/09

US Dollar Rs.67.0809 Pound Sterling 90.58/60 EURO Rs.80.0074 Euro 79.60/62 Japanese yen (100) 61.55/57

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Dewan Housing seeks Sebi’s nod to raise up to Rs 15,000-crore via Non Convertible Debentures

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Dewan Housing Finance has sought markets regulator Sebi’s approval to raise up to Rs 15,000 crore through debentures to support its lending activities.

This NCD issuance will be in one or more tranches, according to the draft paper filed with Securities and Exchange Board of India (Sebi).

NCDs are loan-linked bonds that cannot be converted into stocks and usually offer higher interest rates than convertible debentures.

In the draft papers, Dewan Housing said it has proposed public issue of “up to 15 crore secured redeemable non-convertible debentures (NCDs) of face value of Rs 1,000 each aggregating up to Rs 15,000 crore”.

Proceeds of the issue will be utilised towards onward lending, financing, and for payment of existing borrowings of the company and for other general corporate purposes.

Edelweiss Financial Services, A K Capital Services, Axis Bank, Green Bridge Capital Advisory, ICICI Bank, ICICI Securities, IIFL Holdings, IndusInd Bank, SBI Capital Markets, Yes Securities and Trust Investment Advisors will mange the public issue.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

‘FMCG topline may rise by 300-400 bps in FY19 on rural demand’

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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A revival in rural demand may help boost the topline growth of the Rs 3.4-trillion fast moving consumer goods (FMCG) sector by 300-400 basis points to 11-12% this financial year, said a report.

The FMCG sector is likely to report 11-12% rise in revenue in fiscal 2019, up 300-400 basis points from 8% in fiscal 2018, driven by revival in rural demand and new product launches, domestic rating agency Crisil said in a report today.

This will lead to a significant improvement in their operating performance and benefit credit profiles, it added.

The rural economy may get a leg-up from the higher minimum support prices (MSP) announced by the Centre and also a favourable monsoon rainfalls, more non-agriculture rural employment, which in turn will increase farmers’ disposable income, leading to consumption demand.

From the marketers’ side, continuing product launches and greater acceptance of ayurvedic and herbal products will also help.

“Therefore, revenue growth from the rural segment which contributes 40-45% of the total income of the sector, will improve to 15-16% in fiscal 2019 compared to 10% estimated for fiscal 2018,” the report said.

Growth had recovered partially from the 5-percentage point range during fiscals 2016 and 2017, according to Crisil, a period that saw sluggish rural demand resulting from weak monsoons, intense competition and demonetisation.

On the other hand, revenue growth from the urban segment is expected to stay steady at 8% in FY19.

While mid-sized and medium-sized firms will have an edge because of better operating efficiencies in the GST regime and may clip at 15-17%, according to the report, large firms are seen growing topline by 300-400 bps to 11-12%.

On the other hand, smaller firms will continue to be buffeted by competition and GST, and register modest growth.

“Given the prospects, we see large and mid-sized firms augmenting growth through two flanks: acquisitions and new launches,” said Anuj Sethi, senior director, Crisil Ratings.

“Small regional players with established brands are likely to be acquired by larger peers, even if such deals are expensive, to reduce time to market,” he added.

Operating profit of large and mid-sized firms is expected to sustain at double-digits but rising cost and higher promotional spend will largely be offset by savings on logistics, transportation and from supply chain efficiencies.

On improvement in credit profile of these companies, the report expects the positive trend in credit ratio to sustain for large and mid-sized firms driven by improving business profiles.

According to Amit Bhave, director, Crisil Ratings, healthy cash generation and prudent working capital management, along with deep pockets will allow for higher spend on acquisitions.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow