Timely Indian Market & Stock News - August 2011

Steel prices likely to go up in October. [Tata Steel Ltd.] was trading at Rs474.25, up by 0.98%

[IFCI Ltd.] gains on plans to buy ICICI Bank’s 17% share. The stock was trading at Rs39.50, up by 1.67%

[Coal India Ltd.] slips as labour union demand 100% hike in salary.

AUM of life insurance companies up by 11.3% in Q1.

FDI inflow to surge sharply to $19.5 billion.

[ITC Ltd] to boost its presence in tobacco segment.

[Infosys Ltd] sees outsourcing rev growing 15%-20% in FY12.

[Tata Chemicals Ltd.] acquires stake in EPM Mining. The stock was trading at Rs353, up by 1.18%

[Kiri Industries Ltd.] spurts on plans to list subsidiary.

[Cupid Ltd.] soars on order win. The stock was trading at Rs7.70, up by 7.09%

[Aventis Pharma Ltd.] to buy Universal Medicare biz. The stock was trading at Rs2,119.95, up by 4%

[Lupin Ltd] soars as Japanese firm in talks to buy stake

1. State Bank of India's rights issue will come out this fiscal itself, but
the bank maintained that it is well capitalised to see through this
fiscal if the government delays giving its go-ahead for the proposed
Rs21,000cr issue.

2. The government has issued notices to operators of Delhi and Mumbai
airports to recover service tax dues amounting to about Rs200cr.

3. Titan Industries, maker of watches and fashion accessories, plans
to enter new verticals every other year and gain leadership in that
market.

4. Indian Bank will defer its follow-on-share sale as market conditions
are not conducive.

5. Software body, Nasscom remains confident about its projection for
16-18% growth of the Indian IT industry in FY2012 despite the
economic uncertainty in the US and European markets.

[Clutch Auto Ltd.] spurts 5% on conversion of warrants.

[Sterlite Technologies Ltd.] bags 2 orders worth Rs225 crore from Power Grid Corp.

[Larsen & Toubro Ltd.] bags new orders worth Rs797 crore.

Gold loses more shine after CME margin hike

Food inflation rises to 9.80% for week ended Aug 13

Inflation to remain elevated for some more: RBI.

Blackstone acquires 7% stake in [Monnet Ispat & Energy Ltd.]

[Infosys Ltd.] secures deal from ANZ Australia

India's urea production up by 4% in FY11

July GSM mobile addition slips to lowest since 2007.

RBI releases draft rules for bank licences for corporates

The Reserve Bank of India released on its website today, the Draft Guidelines for "Licensing of New Banks in the Private Sector". The Reserve Bank has sought views/comments on the draft guidelines from banks, non-banking financial institutions, industrial houses, other institutions and the public at large.

Final guidelines will be issued and the process of inviting applications for setting up of new banks in the private sector will be initiated. After receiving feedback, comments and suggestions on the draft guidelines, and after certain vital amendments to Banking Regulation Act, 1949 are in place.

Key features of the draft guidelines are:

(i) Eligible promoters: Entities / groups in the private sector, owned and controlled by residents, with diversified ownership, sound credentials and integrity and having successful track record of at least 10 years will be eligible to promote banks. Entities / groups having significant (10% or more) income or assets or both from real estate construction and / or broking activities individually or taken together in the last three years will not be eligible.

(ii) Corporate structure: New banks will be set up only through a wholly owned Non-Operative Holding Company (NOHC) to be registered with the Reserve Bank as a non-banking finance company (NBFC) which will hold the bank as well as all the other financial companies in the promoter group.

(iii) Minimum capital requirement: Minimum capital requirement will be Rs 500 crore. Subject to this, actual capital to be brought in will depend on the business plan of the promoters. NOHC shall hold minimum 40% of the paid-up capital of the bank for a period of five years from the date of licensing of the bank. Shareholding by NOHC in excess of 40% shall be brought down to 20% within 10 years and to 15% within 12 years from the date of licensing of the bank.

(iv) Foreign shareholding: The aggregate non-resident shareholding in the new bank shall not exceed 49% for the first 5 years after which it will be as per the extant policy.

(v) Corporate governance: At least 50% of the directors of the NOHC should be independent directors. The corporate structure should be such that it does not impede effective supervision of the bank and the NOHC on a consolidated basis by the Reserve Bank.

(vi) Business model: Should be realistic and viable and should address how the bank proposes to achieve financial inclusion.

(vii) Other conditions:

• The exposure of bank to any entity in the promoter group shall not exceed 10% and the aggregate exposure to all the entities in the group shall not exceed 20% of the paid-up capital and reserves of the bank.
• The bank shall get its shares listed on the stock exchanges within two years of licensing.
• The bank shall open at least 25% of its branches in unbanked rural centres (population upto 9,999 as per 2001 census)
• Existing NBFCs, if considered eligible, may be permitted to either promote a new bank or convert themselves into banks.

(viii) In respect of promoter groups having 40% or more assets / income from non-financial business, certain additional requirements have been stipulated.

BGR Energy bags Rs 444 cr order from Nuclear Power Corp

Engineering, procurement and construction company BGR Energy Systems has bagged Rs 444.48 crore order from Nuclear Power Corporation of India.

The order involves supply, erection, testing and commissioning of main plant electrical systems, including nuclear Island electricals at Kota Rajasthan for 2x700 MW and Kakrapara in Gujarat 2x700 MW has been given to the electrical projects division of city-based BGR Energy Systems, a company statement here said.

The two projects are expected to be completed between September 2015 and March 2016, it said.

"This happens to be the single biggest order for main plant electricals received by BGR Energy so far and would facilitate qualifications in the future," BGR Energy Systems CEO V Balakrishnan said.

BGR Energy Systems designs and manufactures 22 high technology equipment for power, process and infrastructure projects for world markets. As of March 2011, the company achieved a turnover of Rs 4,763 crore, the statement added.