Ratan Tata meets Anand Sharma post FIPB nod for airline venture

With the FIPB giving approval to the Tata-Singapore Airlines joint venture to start a full-service carrier, Tata Group Chairman Emeritus Ratan Tata on Friday met Commerce and Industry Minister Anand Sharma.

Tata was accompanied by Singapore Airlines (SIA) CEO Goh Choon Phong and Tata SIA Airlines Chairman Prasad Menon.

While Tata declined to comment, sources in the ministry said the meeting was a courtesy call.

On Thursday, Tata along with Phong had also met Finance Minister P Chidambaram after the FIPB cleared the venture.

The Foreign Investment Promotion Board (FIPB) gave its green signal to Singapore Airlines to start a full-service airline in partnership with Tata Sons entailing an initial foreign investment of $49 million.

This is Tatas' second venture in the aviation sector after its tie-up with Malaysian carrier Air Asia in February for a low cost passenger air service.

Economic Affairs Secretary Arvind Mayaram had stated that there were no riders set for the joint venture.

While Singapore Airlines plans to invest $49 million, Tatas would be contributing remaining amount of the total planned $100 million investment in the joint venture.

The joint venture needs other government approvals before it can start operations.

To be called Tata SIA Airlines Ltd, the venture would be headquartered in Delhi.

The two had assured the government that control of their proposed venture would always remain in Indian hands, while seeking approval to offer full-service passenger airways on both domestic and international routes. Of the six directors, four would be nominated by the Tatas.

Wockhardt Q2 net dips 69 per cent to Rs 138 cr

Wockhardt has reported a 69.46 per cent decline in its consolidated net profit for the second quarter ended September 30.

The pharma major posted a consolidated net profit of Rs 138.50 crore for the quarter under review against Rs 453.55 crore in the July-September period of 2012-13.

In a filing to the Bombay Stock Exchange, Wockhardt said net sales during the second quarter stood at Rs 1,196.97 crore against Rs 1,347.44 crore in the year-ago quarter.

The company also said its Board of Directors have declared an 100 per cent interim dividend of Rs 5 per share for the financial year 2013-14.

Shares of Wockhardt closed 0.98 per cent down at Rs 455.35 on the Bombay Stock Exchange on Friday.

Deutsche Bank sees Sensex at a record 22,000 by Dec end

 
A day after the market benchmark sniffed at life-time high, German brokerage Deutsche Bank on Friday raised its year-end Sensex target to a record high of 22,000 points, saying investor pessimism earlier this year is receding amid positive developments like the good monsoons.

"We are raising our December Sensex target from 21,000 to 22,000 premised on our expectation that the pace of negative news flow over the country and excessive investor pessimism may be receding," Deutsche Bank said.

The Sensex hit an all-time high of 21,206.77 on January 1, 2008, while during intra-day on Thursday, it had scaled 21,039.42. While on January 1, 2008, the Sensex was trading at 28.12 times its PE, on Wednesday it was 18.89 times.

The bank said currency stability, lowering gold imports, rising exports and taper postponement have imparted considerable legitimacy to the government's commitment to contain CAD - the main pain-point for the economy.

In addition, the best monsoon in 15 years is expected to lay the foundation for an accelerated recovery in the rural economy which accounts for 56 per cent of total income and 64 per cent of total expenditure.

While stating it is not expecting any imminent turn in private sector investment momentum and remains cautious over near term monetary policy action, the brokerage has based its optimism on macroeconomy, likely withdrawal of extraordinary liquidity tightening measures by RBI, a synchronised global growth recovery and a US Fed that is expected to stay 'looser for longer'.

"At our target the Sensex will trade at a PE multiple of 15 times, in line with its past five trading average," the brokerage said.

The benchmark BSE Sensex fell 0.2 per cent, or 42.45 points, to end at 20,725.43 on Thursday.

On its preferred stocks/sectors, it replaced IT services which it holds as 'neutral' with banks as the biggest portfolio overweight followed by metals, citing receding concerns over tight liquidity and higher short-end interest rates.

"Our top picks include Axis Bank, Bharti Airtel, Bharat Forge, Coal India, Godrej Consumer, ITC, IndusInd Bank, Larsen & Toubro, Maruti, RIL, Tata Steel and Zee.

"We have raised banks as the top overweight in our model portfolio as we believe that excessive concerns over tight liquidity and elevated short-end rates are behind us, and fears of sharp margin compression and treasury losses have waned," it said.

However, it said the three key themes investors will be playing out will be currency stabilisation, rural demand recovery and global growth.

Stating that the overall scene is not as bad as it appeared earlier, it said following fears over the Fed taper in May and the sharp currency depreciation, investors had feared a vicious economic cycle for the country and a protracted return to normalcy.

It also noted that contrary to prevailing pessimism during the currency crisis, the Q2 earnings so far have been above street expectations, assuaging investor concerns over an accelerated earnings downgrade cycle.

Gold, silver prices zoom on seasonal demand

Gold prices surged by Rs 305 to Rs 31,930 per ten gram in the national capital on Wednesday on brisk buying by stockists and jewellers to meet the rising seasonal demand amid strong global trend.

Silver prices too zoomed by Rs 1,190 to Rs 50,200 per kg on increased offtake by industrial units and coin makers for coming festivals led by Diwali and ongoing marriage season.

Silver and gold coins, which are normally used for pooja on Diwali and gifting purpose during marriage celebrations, remained in keen demand.

Firm global trend after payrolls in the US climbed, increasing speculation the Federal Reserve will maintain monetary stimulus to boost the economy, also influenced the sentiment, traders said.

Gold in New York, which normally sets price trend on the domestic front, climbed 2 per cent to $1,342.60 an ounce, nearing the highest level since September 30. Silver also climbed 2.3 per cent to $22.79 an ounce.

On the domestic front, gold of 99.9 and 99.5 per cent purity surged by Rs 305 each to Rs 31,930 and Rs 31,730 per ten gram, respectively, while sovereign held steady at Rs 25,300 per piece of eight gram.

In a similar fashion, silver ready surged by Rs 1,190 to Rs 50,200 per kg and weekly-based delivery by Rs 700 to Rs 50,000 per kg. However, silver coins held steady at Rs 87,000 for buying and Rs 88,000 for selling of 100 pieces.

L&T Finance net up 13.7 per cent to Rs 301 crore

L&T Finance Holdings has reported a 13.7 per cent rise in consolidated net profit in the September quarter to Rs 300.7 crore, driven by a healthy growth in assets.

Loans and advances grew 28.2 per cent year-on-year to Rs 35,458.7 crore compared to Rs 33,309.9 crore.

The growth in net profit in lending businesses has been on account of improvement in margins, offset by an increase in credit cost. For the lending businesses, net interest margin for the quarter improved by 0.1 percentage point to 5.6 per cent, the company said in a statement.

Gross NPAs stood at 2.89 per cent or at Rs 992.9 crore of loan assets compared to 2.54 per cent in the June quarter or Rs 846.4 crore. Net NPAs stood at 1.93 per cent or Rs 654.6 crore of loan assets compared to 1.67 per cent or Rs 551 crore in the June quarter.

The company attributed the rise in gross NPAs to slippage of one account in the infrastructure segment.

Despite a de-growth in the investment management business industry, the average assets under management grew by 9.4 per cent to Rs 15,078.9 crore, resulting in an increase in market share from 1.6 per cent in Q1 to 1.9 per cent in Q2.

The private wealth management business continued to grow momentum with the client base crossing 1,000 and an average assets under service of Rs 3,570 crore.

MTS awaits cheaper spectrum for India expansion

 
Sistema Shyam TeleServices (SSTL), which operates under the MTS brand in India, has launched a high-speed wireless broadband service in an attempt to boost its data revenue.

The new 3GPlus service will offer speed as high as 9.8 Mbps. This is higher than the speed on third-generation (3G) networks, which peaks at 7.2 Mbps, but is lower than 4G speed.

"The margins are higher on data. So we want to be a data company," said Dmitry Shukov, CEO of MTS India.

The company has licences to operate in nine of India's 22 telecom service areas. The 3GPlus service is delivered over evolution-data optimised (EVDO) technology. It will be available over MTS dongles and MTS-branded smartphones. The service will be offered at a starting price of Rs 700 for a month, and goes up to Rs 1,498.

The company aims to increase its share of the Indian dongle market by 50 per cent. It currently has 13 per cent of the Indian dongle market by volume. However, if the nine circles where MTS is present are to be taken, it governs anything between 18 to 20 per cent, said Leonid Musatov, Chief Marketing and Sales Officer at MTS India.

CEO Shukov said the company will expand beyond the nine circles if it gets spectrum at a lower rate. When asked what should be the reserve price for spectrum, he answered: "The right price according to me is zero."

So, at what price does MTS want to go for pan-India expansion? "We have done some calculations but are not ready to talk about them," Shukov said. But he is sure he wants spectrum cheaper than what MTS paid in the last auction - Rs 2,013 crore in addition to Rs 1,626 crore it had paid in 2008.

In early October, MTS received a unified telecom licence from the government, which allows it to offer services through both Code Division Multiple Access (CDMA) and Global System for Mobile communications (GSM) technologies. However, it's not interested in providing GSM services.

"What's the point of thinking about 2G when operators are looking at next-generation [services]," Shukov said.

The company also recently received its third carrier, or tranche, of 1.25 Mhz spectrum for all its circles, taking its total spectrum availability to 3.75 Mhz. But it will still not be able to offer long-term evolution (LTE) technology for 4G services, which it intends to do.

"We need four carriers to do LTE in these circles, but we don't have contiguous spectrum," Shukov said. He, however, remains committed to achieving MTS India's break-even by the end of 2014. Shukov is also waiting for clarity on the Indian government's merger and acquisition guidelines for the telecom sector.

Is MTS looking to make an acquisition? "We are open for discussion [with other operators]," Shukov said

Microsoft says Apple apps going free not a big deal

 
This was expected, but it hasn't taken a long time coming. A day after Apple announced that its new operating system , OS X Mavericks, as well as its office suite iWork -and iLife - would be free from now on , rival Microsoft has retorted by saying that the announcement was "not a big deal".

In a post filed on Microsoft's TechNet blog Frank Shaw, Corporate Vice President of Communications at Microsoft, said both Surface tablets had Office for free. "… Making Apple's decision to build the price of their less popular and less powerful iWork into their tablets is not a very big deal."

In a very cynical note, Shaw, who filed the post from Abu Dhabi, where the Nokia World has just concluded, added: "Seems like the RDF (Reality Distortion Field) typically generated by an Apple event has extended beyond Cupertino."

"Apple announced yesterday that they were dropping their fees on their "iWork" suite of apps. Now, since iWork has never gotten much traction, and was already priced like an afterthought, it's hardly that surprising or significant a move. And it doesn't change the fact that it's much harder to get work done on a device that lacks precision input and a desktop for true side-by-side multitasking," he added in a bid to show that the Surface tablets were superior to the iPad as far as productivity is concerned.

The post does not say much on what Redmond thought about the OS going free, but Shaw went on to highlight that the Surface and Surface 2 "are less expensive than the iPad 2 and iPad Air respectively, and yet offer more storage, both onboard and in the cloud". However, the fact is that Microsoft's tablets are far from popular and not even available in countries like India.

Perched in its position of software superiority Microsoft can afford to play hardball. "So, when I see Apple drop the price of their struggling, lightweight productivity apps, I don't see a shot across our bow, I see an attempt to play catch up," added Shaw in his post.
Now, to see if Microsoft can afford to maintain the hardline for long