Month: May 2018

Ex-Tata boss Mistry hits back at R Venkataraman for dragging his name in CBI probe

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

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Former Tata Group chief Cyrus Mistry on Thursday hit back at Tata Trust boss R Venkataraman for dragging his name in the AirAsia India case, saying it was a “ridiculous attempt” to question the Central Bureau of Investigation’s  independence and hide his “alleged misadventures” at the airline.

On Wednesday, Venkatraman had said the accusations against him find their root in “baseless allegations made by former Tata Group chairman Cyrus Mistry and Shapoor Pallonji Group against the trustees of Tata Trusts, including him, and Tata Sons.”

Mistry, who was ousted from Tata Group after an acrimonious boardroom fight and is engaged in a long-running legal battle with Tatas since then, said the board of Tata Sons and the Tata Trustees should concern themselves over the decline in governance standards at the budget carrier.

He denied the allegations levelled against him by Venkataraman as “malicious” and “defamatory.”

Venkataraman is a  non-executive director at AirAsia India and figures among those against whom the CBI has filed a case in the Air Asia case.

The CBI has registered a case against AirAsia Group CEO Tony Fernandes, Venkataramanan and other officials for allegedly trying to manipulate government policies through corrupt means to get international licence.

“It is well documented that Mr R Venkataraman was intimately involved in the affairs of AirAsia India right from its inception. He has had many roles including that of Executive Assistant to Mr Ratan Tata at the time of the formation of the company (AirAsia India), Tata Sons’ nominee on the board, as well as that of a shareholder with a 1.5 per cent stake in the company,” Mistry said in a statement today.

The budget carrier is majority-owned by Tatas and Venkataramanan has around 1.5 per cent shareholding in the joint venture with AirAsia Berhad.

“His weak excuse that he was only a non-executive director without any responsibility is totally without any merit…the board of Tata Sons and the Tata Trustees need to concern themselves over the decline in governance standards at AirAsia India that this shameful case reveals,” Mistry added in the statement.

Venkatraman had said he was “wrongly named” by the CBI in relation to the Air Asia case, and that he had “little or no role to play” in his capacity as non-executive director of AirAsia India Limited.

“R Venkataraman, as the Managing Trustee of the Tata Trusts, should know better than to drag the name of such a remarkable institution into an investigation by the CBI over his alleged personal integrity and alleged corrupt business dealings,” Mistry said in the statement.

“This ridiculous attempt to question the independence of the CBI and to cloak his alleged misadventures by using my name is treated with the contempt it deserves,” he added.

Venkataraman’s alleged actions, which are under investigation, raise grave public concerns over his credibility and ability to be the custodian of India’s largest public charitable trust, Mistry said.

On Tuesday, the Central Bureau of Investigation (CBI) launched a case against low-cost airline AirAsia India, its Malaysian parent AirAsia Bhd, and senior executives, including group chief executive officer Tony Fernandes, among others.

CBI has charged the entities and executives with allegedly entering into a criminal conspiracy with the previous UPA government to secure rights to fly abroad.

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

India’s 2017/18 fiscal deficit at 3.5% of GDP

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

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India’s fiscal deficit in the year ended March 2018 came in at 3.53% of gross domestic product, in line with the revised estimates, government data showed on Thursday.

India revised its fiscal deficit target in February to 3.5% of GDP from 3.2% of GDP for the 2017/18 fiscal year. For the current fiscal year, the government estimates to trim the deficit to 3.3% of GDP.

The shortfall for the 2017/18 fiscal year was 5.9 trillion rupees ($87.53 billion), the data showed.

New Delhi got 12.4 trillion rupees in net tax receipts during the fiscal year.

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

HDFC Bank shares up over 4%; mcap rises by Rs 23,577 crore

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

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Shares of private lender HDFC Bank rose by over 4% today, adding Rs 23,577 crore to its market valuation, amid reports that the window for foreign investors to pick up stake in the company will open tomorrow.

The stock gained 4.36% to end at Rs 2,136.15 on BSE. During the day, it jumped 5% to Rs 2,150 — its 52-week high.

At NSE, shares of the company went up by 4.44 per cent to close at Rs 2,139.45.

Led by the rally in the stock, the company’s market valuation zoomed Rs 23,576.96 crore to Rs 5,54,752.96 crore.

In terms of equity volume, 2.85 lakh shares of the company were traded on BSE and over 99 lakh shares changed hands on NSE during the day.
The bank’s ADRs rallied 7 per cent in New York yesterday.

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

SAIL confident of supplying 12 lakh tonne of rails to railways in FY19

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

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This year, we are quite confident that we will supply 12 lakh tonne of rails to railways, said PK Singh, Chairman, Steel Authority of India Ltd (SAIL).

“Last year, we supplied nearly 9 lakh tonne of rails through railways, which fetched us better price,” said Singh to CNBC-TV18.

Watch: SAIL aiming for 18 mt in volumes for FY19

Singh said the company has reduced manpower cost by nearly Rs 700-800, which is nearly 10%.

Talking on employee cost, he said for 2017-2018, it was reduced to Rs 5,800.

Edited Excerpts:

This time, the sales growth was good 34% in this quarter. I just want to know what the sales volumes were in this quarter and what are you targeting for FY19? The last time we spoke with you, you said that you will do approximately 16 million tonne for FY19, would you still hold on to that guidance?

This is not the last quarter, we have made the profit. In fact, in third quarter also we have shown a modest profit of Rs 82 crore. I have told that time only, that fourth quarter results are going to be much better. Fourth quarter is the nearly ten times more than that. Despite taking a hit of one-time provision, our profits are more than nearly Rs 1,200 crore.

We had seen the physical parameters, the growth is there almost 7 to 8% physically we have improved. There is almost more than 30% improvement in the turnover. For FY19, we have taken a very challenging target. Let me tell you, the growth this year has to be tremendous because all of our modernisation facilities, like blast furnace eight at Bhilai has been commissioned. Rourkela one blast furnace we have added. This is going to give us nearly more than three million tonne of added production. The complete benefit, we will be getting this financial year.

Can you give us some concrete volume numbers? What is the volume in FY18 that you did and now with all your blast furnace plans working what is the expected volume in FY19?

See, the volume that we have planned is nearly 18 million tonne for the FY19. But there are some problems on the logistic front. So, I do not see any reason why we slip more than 1 million tonne. Between 17 and 18 we should finish.

FY18 how much was it?

It was 14.07 million tonne. Last year also, we had suffered production, because of the logistic problems and there is a lot of improvement on the logistic front. Losses that we have suffered last year, it should not happen this year.

What are you targeting in terms of an earnings before interest, taxes, depreciation, and amortization (EBITDA) per tonne? What do you think would be reasonable target for FY19?

See, the fourth-quarter EBITDA that we have achieved, if you take purely the operational parameters, it was nearly Rs 8,000 per tonne and already in month of April and May, there is an increase in prices of nearly Rs 2,000. Our average net sales realisation (NSR) was Rs 40,000 in the fourth quarter. In the last two months, average increased to Rs 2,000. So taking that forward, there has to be an EBITDA increase of nearly Rs 2,000 that means Rs 10,000.

But, even if we take Rs 8,000 for the whole year, because you cannot expect the similar prices, which we are having right now, so Rs 8,000 is quite reasonable. Let me also tell that our cost of production because of the manpower cost, there is a tremendous improvement on the manpower cost. We have reduced our manpower cost by nearly Rs 700-800 which is nearly 10%. So that will be carried forward.

Also, we will see a substantial reduction in the manpower of cost also. There is no reason why our EBITDA should not increase by Rs 2,000 more. If we take the fourth quarter EBITDA Rs 8,000, I mean more than Rs 12,000 crore, very reasonable target FY18.

You have the highest number of employees anyway what are your employee plans, any rationalisation?

Our employee cost was around Rs 6,500 per tonne for the year 2016-2017 and for 2017-2018 the cost has reduced to Rs 5,800. There is a substantial reduction of Rs 700, which is 10% on absolute term also this has reduced.

What is the plan in FY19 in terms of employee costs?

Our employee cost two years back was 22% of the manufacturing cost that we were taking and we had taken a very ambitious target of reducing it to 15% in two years time. I am happy to declare that we have already done it. In the next three to four years, this cost has to further come down and we should be somewhere around 10 to 11%.

Any a distressed assets that SAIL is looking at and anything that we can expect to hear in this calendar year itself?

The few products, which are high-value product for us like rail production last year, we had seen a substantial jump. Whatever we have supplied to railways was nearly 40%. Last year, we supplied nearly 9 lakh tonne of rails through railways, which fetched us better price. This year, we are quite confident that we will supply 12 lakh tonne of rail to railways.

Second, we should see a substantial jump of nearly 15% production in cold rolling products, which is again a high value-added product for us. Third, plates that we produce at Rourkela and there we have especially for this pipe making and all that this particular plate we have already taken trials and we are going to have commercial production this year. A substantial growth will happen this year and that will add to our kitty.

Fourth most important thing is that, we have already reduced our semi sale, which is typically a low price sale. There also nearly 15% reduction has taken place last year. This year also, we are planning similar 10-15% reduction in semi sale which will again increase my NSR.

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

US to impose tariffs on EU steel, aluminium

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

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Washington will announce plans to impose tariffs on EU steel and aluminium imports, two sources said, while a magazine reported US President Donald Trump was now focused on pushing German cars from the country.

US Commerce Secretary Wilbur Ross was due to hold a news briefing at 9 a.m. (1300 GMT) to announce “Section 232” national security-related tariff modifications, the US Commerce Department said.

German magazine Wirtschaftswoche reported on Thursday that Trump had told French President Emmanuel Macron he wanted to stick to his trade policy long enough that Mercedes-Benz cars were no longer cruising through New York, news that dented share prices in BMW, Daimler and Volkswagen.

The Trump administration launched a national security investigation last week into car and truck imports, using the same 1962 law that he has applied to curb incoming steel and aluminium.

French Finance Minister Bruno Le Maire met Commerce Secretary Ross on Thursday hoping to end the stand-off.

“It’s entirely up to US authorities whether they want to enter into a trade conflict with their biggest partner, Europe,” Le Maire told reporters after the meeting.

Europe did not want a trade war, he said, but Washington had to back down from “unjustified, unjustifiable and dangerous tariffs“. The European Union would respond with “all necessary measures” if the United States imposed them.

Ross hinted that tariffs were coming. “If there is an escalation it will be because the EU would have decided to retaliate,” he told French daily Le Figaro.

“The next question would be: how will the president react? You saw his reaction when China decided to retaliate.”

When China targeted key US imports in retaliation against US tariffs on $50 billion of Chinese goods in April, Trump ordered US officials to identify a further $100 billion of Chinese products the United States could hit.

German Chancellor Angela Merkel said the European Union would give a “smart, determined and jointly agreed” response to new US tariffs that she said would break World Trade Organization rules.

US Bourbon, Harleys on EU list

Trump’s decision would come either before markets opened or after they closed, Ross said. The two sources briefed on the matter said the announcement was planned for the morning in Washington but that the timing could still change.

The European Commission, which coordinates trade policy for the 28 EU members, has said the bloc should be permanently exempted from the tariffs since it is an ally and not the cause ofsteel and aluminium overcapacity.

EU countries have given broad support to the Commission’s plan to set duties on 2.8 billion euros ($3.4 billion) of US exports, including whiskey and motorbikes, if Washington ends the EU tariff exemption. EU exports potentially subject to US duties are worth 6.4 billion euros ($7.5 billion).

Germany, whose car exports to the United States are more than half the EU total, has previously been at odds with EU partners, suggesting a softer approach.

However, Economy Minister Peter Altmaier appeared with Le Maire in Paris on Wednesday, pledging a unified line.

“We are prepared to react in a united and clear way whatever the decision of the (US) president,” he said.

The tariffs, which have prompted several challenges at the WTO, are aimed at allowing the US steel and aluminium industries to increase their capacity utilization rates above 80% for the first time in years.

The Trump administration has given permanent metals tariff exemptions to several countries including Australia, Argentina and South Korea, but in each case set import quotas.

Friday’s deadline for exemptions also affects Mexico and Canada, which are in negotiations with the United States on the North American Free Trade Agreement that Trump has said he wants to revamp, or abandon if the talks fail. ($1 = 0.8575 euros)

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

Indian economy grows 7.7% in March quarter: Experts react

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

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India’s economy grew 7.7% in the three months through March from a year earlier, government data showed on Thursday, faster than a revised 7.0% in the previous quarter.

The annual pace for the latest period beat a Reuters poll forecast of 7.3% growth.

For the 2017/18 full fiscal year ended in March, growth was 6.7%.

Shilan Shah, India Economist, Capital Economics

“The acceleration was in large part due to a rise in household consumption growth, which tallies with other consumption indicators such as vehicle sales strengthening last quarter.”

“Looking ahead, growth should remain strong. The recent manufacturing PMIs have been upbeat. Government consumption growth is also likely to strengthen further this year as the 2019 general election comes onto the horizon.”

Teresa John, Economist, Nirmal Bang Institutional Equities, Mumbai

“Broadly the recovery remains on track and should sustain for at least the next four to six quarters. For FY19, we are expecting a growth of 7.5%.”

“As a crude importer, higher oil prices are negative, but we don’t expect a significant downturn in the economy. We have cut our FY19 GDP forecast by 20 basis points taking into account rising oil prices and potential global trade wars.”

“In terms of RBI’s outlook, we expect a rate hike soon. There’s a 50% chance of a rate hike happening in June.”

From FY14 and FY2018, people moved from banks to commercial paper markets and corporate bond markets because the market yield was lower than the bank lending rate. But now, the situation has reversed, so you will see a growth in banks’ credit growth.”

Garima Kapoor, Economist and Vice-President, Elara Capital, Mumbai

“A  $10/bl increase in crude prices can impact growth by ~ 20-30 bps. The impact works through two channels – decline in demand owing to rise in prices and higher cost of borrowing as interest rates increase with upside risks to inflation.”

“Apart from high oil prices, another factor that could potentially add downside risk this year is a possible moderation in global trade growth amid continuing tensions.”

“We expect RBI to revise its policy stance in June and follow it up with a hike of 25 bps in Aug policy. Of the factors that RBI mentioned as risks in its April policy, an increase in global crude oil prices has come to fruition.”

“We expect FY19 credit growth to improve marginally to 12-13% with private sector banks leading the improvement, with public sector banks being constrained by capital requirements and resolution of stressed corporate loans.”

Tushar Arora, Senior Economist, HDFC Bank, New Delhi

“There are some bad bugs in the form of rising oil prices, higher bond yields and lingering non-performing asset issues, affecting the overall sentiment related to the Indian economy. However, today’s GDP number is very comforting and should put a lot of concerns to rest. (It) Seems like we have moved beyond the teething troubles related to GST implementation. The pick-up in investment activity (fixed capital formation) is also a good sign. If the government can provide some impetus to the exports sector, the main drag at the moment, we could soon see the headline number inching close to 8%.”

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

Nokia sells digital health venture, executive to leave

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

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 Nokia said on Thursday it had sold its small digital health business, including activity trackers and smartwatches, and the executive who wound down the company’s consumer ventures will leave Nokia after less than a year in the job.

Digital health was one of the areas the Finnish company had been counting on for future growth opportunities amid a tough market for its mainstay telecom network equipment business.

But Gregory Lee, a former Samsung executive who took the helm of Nokia‘s Technologies unit last year, pulled Nokia away from the business as well as a virtual camera venture, leaving the unit to focus on patent and brand licensing.

The health business was sold to Eric Carreel, co-founder and former chairman of the operation, for an undisclosed price. Nokia had announced plans to sell the business earlier this month.

“Gregory came to Nokia… and took the bold decision to refocus Nokia Technologies on licensing… We have agreed that his work at Nokia is done,” Nokia CEO Rajeev Suri said in a statement.

Chief Legal Officer Maria Varsellona will take over the Technologies unit, Nokia said. The licensing business, highly profitable, includes royalties from handset vendors for the use ofNokia‘s brand and smartphone patents.

As an initial move into the health market, Nokia in 2016 bought France’s Withings for 170 million euros ($199 million). An internal memo from February showed that the business failed to meetNokia‘s growth expectations.

Nokia has not given exact sales figures for the business, but digital health and virtual camera products in total generated 52 million euros of sales last year, compared to Nokia‘s total revenue of 23.2 billion euros.

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

Impact of price control on stents, knee caps pegged at Rs 11 crore, says Apollo Hospitals

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

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Impact of price controls on knee-caps and on stents for fourth quarter is pegged at Rs 11 crore, said Suneeta Reddy, Managing Director, Apollo Hospitals.

Speaking exclusively to CNBC-TV18’s Latha Venkatesh and Sonia Shenoy, she said revenue from new hospitals grew by about 24% and from the mature hospitals grew about 7%.

Watch: Expect Navi Mumbai hospital to break even this quarter, says Apollo Hospitals

She said company’s standalone revenue grew by 15% to Rs 1,863 crore, out of which the healthcare services grew by 8%.

Edited Excerpts:

First, if you could take us through the overall performance this quarter. As you see it, what are the highlights?

Overall, our standalone revenue grew by 15% to Rs 1,863 crore out of which the healthcare services grew by 8% and standalone pharmacies grew by 20%, actually 25%, but it is adjusted for Goods and Service Tax (GST). Our earnings before interest, taxes, depreciation, and amortization (EBITDA) grew by 26% to Rs 214 crore, whereas our total healthcare services, EBITDA showed a 24% growth to Rs 174 crore. Our SAP EBITDA grew by 32% to Rs 40 crore.

What was the impact of price controls on knee-caps and on stents in this quarter?

This quarter was about Rs 11 crore.

Could you break up the performance of both, the matured hospitals and the new hospitals for us and what is expected as you head into the new year?

New hospitals grew by about 24% and the mature hospitals grew about 7% and this is on a larger base. So, you must think of 7% on a larger base.

What were the occupancies if you can tell us, the average revenue per beds, the average length of the stay in the hospitals compared to what we saw last quarter; I am just trying to gauge if the trends have improved compared to last few quarters?

The operational beds are 7,176, occupancy is at 65% and should average length of stay is at 4.4.

How much did the recently commissioned Navi Mumbai hospital contributed this quarter and what is the bottomline contribution now from that project?

In Navi Mumbai, we have opened 150 beds. Currently, 128-130 beds are occupied. Last year, it was 98 beds. For the last year, it was Rs 23 crore negative EBITDA, but we are now moving to a positive EBITDA. For the whole year, there was a loss of Rs 35 crore.

When do you expect the Navi Mumbai property to break even since as you said it is still sitting on a loss?

This quarter.

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

US weekly jobless claims fall more than expected

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

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New applications for US unemployment benefits fell more than expected last week, but claims for several states including California and Virginia were estimated.

Initial claims for state unemployment benefits dropped 13,000 to a seasonally adjusted 221,000 for the week ended May 26, the Labor Department said on Thursday. Claims data for the prior week was unrevised.

Economists polled by Reuters had forecast claims falling to 228,000 in the latest week. The Labor Department said claims for California, Kansas, Virginia, Maine, Hawaii, Puerto Rico and the Virgin Islands were estimated last week because of Monday’s Memorial Day holiday.

The labor market is viewed as being close to or at full employment. The jobless rate is near a 17-1/2-year low of 3.9%, within striking distance of the Federal Reserve’s forecast of 3.8% by the end of this year.

The four-week moving average of initial claims, viewed as a better measure of labor market trends as it irons out week-to-week volatility, rose 2,500 to 222,250 last week.

The claims report has no bearing on May’s employment report, which is scheduled for release on Friday. According to a Reuters survey of economists, nonfarm payrolls probably increased by 188,000 jobs after rising by 164,000 jobs in April.

Job growth is slowing, with employers struggling to find qualified workers.

The Federal Reserve’s latest Beige Book report of anecdotal information on business activity collected from contacts nationwide showed labor market conditions remained tight across the country in late April and early May.

The Fed said contacts continued to report difficulty filling positions across skill levels. There were notable shortages of truck drivers, sales personnel, carpenters, electricians, painters, and information technology professionals, the US central bank said in its report published on Wednesday.

The claims report also showed the number of people receiving benefits after an initial week of aid fell 16,000 to 1.72 million in the week ended May 19. The four-week moving average of the so-called continuing claims dropped 8,500 to 1.74 million, the lowest level since December 1973.

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