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Thursday, June 21, 2007

Tata Motors: Have raised about $ 490 mln via CARS incl greenshoe; Capex plan of Rs 12,000 Cr over next 3-4 years

Praveen Kadle, CFO of Tata Motors says that the company has raised a total of $ 490 million via CARS. The YTM is 5.6% and on conversion, it will be around 5%. The company has capex plans of $ 3 bln (around Rs 12,000 crores) over the next 3-4 years. Kadle says that it is too early to comment on CV slowdown.

Tata Motors has priced the issue of Foreign Currency Convertible Alternative Reference Securities ("CARS") aggregating to $ 450 million excluding green shoe option. Application will be made to list the CARS on the Singapore Stock Exchange. The CARS will be convertible, at the option of the Company, into either Qualifying Securities (which may be in the form of depositary receipts with restricted rights of withdrawal, representing underlying ordinary shares, with differential rights as to dividend or voting) or ordinary shares or American Depositary Shares.

The CARS will be convertible at an initial conversion price of Rs 960.96 per share, which is at a premium of 40% to the company's closing share price on NSE as on June 20, 2007. The CARS are zero coupon and outstanding CARS, if any, at maturity will be redeemable at a premium of 31.82% of the principal amount.

I-flex Consulting announces methodology & self assessment toolkit for Basel IA

i-flex Solutions has informed that i-flex Consulting, a division of the company has announced the availability of a methodology and a self-assessment tool kit for Basel IA which is drawn from i-flex''s enormous experience in Basel II implementation.

This is the industry''s first Basel IA implementation solution and aims to offer a structured mechanism for analyzing the strategic opportunities and challenges underlying the proposed Basel IA reforms and their implications for a bank''s regulatory and business environments, a sound methodology to analyze the current risk systems and risk management processes, and identify gaps with respect to the Basel IA framework and best practices,a detailed implementation plan / roadmap describing the pivotal projects to be executed to achieve compliance along with a comprehensive view of timeframes, milestones, investment, payback schedules and resource / infrastructural requirements.

An understanding of benefits that would accrue to a bank beyond compliance, in terms of business advantage, better risk management and risk based pricing.The self-assessment tool kit and the methodology document are available for roll-outs instantly. Speaking on the methodology, Vijay Sharma, Head, i-flex Consulting said, "i-flex strongly supports the endeavor of the Agencies to develop a more risk-sensitive framework for capital estimation. The i-flex Basel IA framework would enable small to mid-tier and regional banks to transition toward a more effective risk-based capital system within reasonable budgets and a realistic time-frames. This would help remove some of the competitive disadvantage of this segment of banks vis--vis the Basel II banks.As part of this initiative, i-flex Consulting also announces a series of workshops to be conducted in the United States.

The first workshop is scheduled on June 21, 2007 in Midtown Manhattan, New York City. I-flex Consulting has the following offerings for Basel IA:- 1) Strategy and Gap analysis, 2) Implementation management and systems integration, 3) Disclosures and reporting requirements.

PSL hits 52-week high on bagging orders

PSL has touched a 52 week high of Rs 307.70 and an intra day low of Rs 279.40. Currently, the share is quoting at Rs 299.90, up Rs 25.05, or 9.11%. It is trading with volumes of 315,071 shares, compared to its 5-day average of 26,036 shares, an increase of 1,110.14%.

Mumbai-based PSL Ltd, a Rs 1,500-crore pipe manufacturing company, has bagged orders worth Rs 380 crore from Sharjah and Malaysia. The company on Saturday rolled out the first pipe from its newly inaugurated -million Sharjah facility.

"Petronas Malaysia has contracted for million and in Sharjah we have three orders worth million. Pipes for Petronas will be supplied from the Kandla unit in Gujarat while for Sharjah the supply will partially be from the new unit there," said Mr Ashok Punj.

Petronas will use PSL pipes for its Peninsular Gas Utilisation Project - a Malaysian internal gas network. The order will be executed by March 2008.

Apart from supplying pipes, the company's unit in Hamriyah Free Trade Zone, Sharjah, will provide coating services both for onshore and off-shore pipelines and cater to the UAE, Saudi Arabia, Oman, Qatar and Kuwait.

The Sharjah facility has an installed capacity of 75,000 tonnes per annum of spiral pipes with facilities for three-layered polyethylene (3LPE) coating, internal liquid epoxy coating, and concrete weight-coating.

The company is also planning a China venture. "We are in discussion with two separate companies in China and will pick the best among them. The investment will be to the order of $ 50-60 million and we are undecided on the equity holding pattern," Mr Punj said.

The company has received various concessions for its Mississippi venture under the Katrina Rehabilitation Package (KRP). PSL, along with the A&L Group of US, is setting up a pipe manufacturing unit on 156 acres at the Bay St. Louis at a cost of $ 55 million.

The concession package offers a 99-year lease for land at $ 1 a year, tax exemption of $ 10 million and tax-free bond for 20 years worth $ 50 million.

"We will be able to raise funds from the market at lower interest rate through the tax-free bond. Of the $ 55 million US venture, we will be investing $ 20 million for holding 75 per cent equity, A&L will invest $ 5 million for the remaining equity and $ 30 million will deployed from the tax-free bonds. The remaining $ 20 million from the bond will be utilised for working capital and other expenses," Mr Punj said.

The company intends importing steel from China and Korea as prices in the US were on the higher side.

Source-Business Line.

Sangam India ties up with Riopele Texteis SA, Portugal for supply agreement

Sangam (India), one of the largest manufacturer of polyester-viscose dyed yarn, has entered into a strategic supply agreement with Riopele Texteis S.A. Portugal-based Riopele, with an annual turnover of Euro 64 million, is one of the largest manufacturer of high value added polyester-viscose bi-stretch yarns and fabrics company. It has composite production facility and is a leading supplier to various leading retail chain in Europe and USA.

Under the agreement, Riopele Texteis will outsource high value added polyester viscose bi-stretch lycra fabrics from Sangam (India). In turn, Sangam (India) will outsource technical expertise and designing pattern fromRiopele Texteis S.A. Initially, the agreement will be for period of one year and subsequently renewed mutually based on performance.

Explaining the rationale behind the tie-up, R P Soni, Chairman, Sangam said, “This is the first step towards our vision to expand in the global markets with high value added product such as poly- viscose bi- stretch fabrics segment.”

Soni also added, “This tie-up with help us to get the technical know-how and latest trend in designing from the Riopele and in turn give us an opportunity to supply high value added. Going forward, we are targeting around 10-15% revenue of its fabrics division revenue through this tie-up.”

S. N. Modani, Managing Director, Sangam added, “We are looking forward towards long term relationship with Riopele and once we attain desired level of revenue target we would further expand the relationship and set up new facility in joint venture with Riopele.”

Govt okays Lakshmi Mittal's 49% stake in HPCL Bhatinda unit

Govt has approved Lakshmi Mittal's 49% stake in HPCL's Bhatinda unit. It says HPCL Bhatinda refinery would cost Rs 190 billion.

The LN Mittal group had been asked by the government to provide a guarantee to HPCL for the proposed investments ($ 800 million) by its subsidiary in the Bhatinda refinery. The parent company — Mittal Sarl — will have to provide guarantees for all investment commitments by its newly floated subsidiary, Singapore- based Mittal Energy Investments.

The government’s move to ask for a guarantee came after the LN Mittal group decided to change the company through which it would invest in the Bhatinda refinery. The joint venture agreement, giving the LN Mittal Group a 49% stake in HPCL’s Bhatinda refinery, was originally signed between Mittal Investments Sarl, the private investment arm of the Mittal Group, and the PSU oilco. Subsequently, the proposed JV partner was changed to the Singapore-incorporated Mittal Energy, in order to take advantage of tax breaks.

Having burnt their fingers in the Globeleq deal where the parent company decided to sell off the shell subsidiary even before the bid was finalised, the government is now insisting on a guarantee from Mittal Sarl, as Mittal Energy — the subsidiary, is a shell company with no independent source of capital or income.

Praj Industries slips; Jhunjhunwalas sell partial amount of stake

Praj Industries has touched an intra day high of Rs 516.80 and an intra day low of Rs 503.40. Currently, the share is quoting at Rs 506.65, down Rs 7.7, or 1.5%. It is trading with volumes of 275,143 shares, compared to its 5-day average of 339,016 shares, an decrease of -18.84%. Yesterday the share closed down 0.92% or Rs 4.80 at Rs 514.35.

The stock is down after going close to 52-week earlier. HDFC Sec has kept an Outperformer and Alchemy Brokerage also kept a Buy rating. Combined Rakesh and Rekha Jhunjhunwala hold around 10.7% in the company. Yesterday they sold about 4.62 lakh shares (0.6%).

Orchid Chemicals gets US nod for antibiotic Cefepime injection

Orchid Chemicals & Pharmaceuticals has received approval from the US FDA for its ANDA (Abbreviated New Drug Application) for Cefepime injection. The product is available in three dosage strengths, 500 mg/vial, 1 gram/vial, and 2 grams/vial. Cefepime injection is a life saving cephalosporin antibiotic drug used in hospital setting. The brand product has a recorded sale of $ 190 million over a 12-month period.

Commenting on the approval, Orchid’s Managing Director, K Raghavendra Rao said, “Orchid’s Cefepime approval for the US generic market is prestigious given that it is the first ANDA approval received for this product from the US FDA. The product has been supplied to Apotex for distribution by them in the US.”

Orchid has till date filed 40 ANDAs comprising 29 antibiotic and 11 non-antibiotic products. Including the Cefepime approval just received, Orchid has received approvals for 19 ANDAs from the US FDA.

Hindustan Motors to launch of the All New Montero on June 25th in Delhi

Hindustan Motors to launch of the All New Montero on June 25th in Delhi; Kazuyuki Kambayashi GM, Asia & ASEAN Business Group Mitsubishi Motors to be there.

TIL secures Rs 43 Cr order

TIL has informed BSE that the Material Handling Solution (Division) of the Company has secured a Rs 43 crore order for two Manitowoc crawler cranes of 450T. The order includes supply and commissioning and will be deployed at BHEL sites.

Glenmark receives tentative US FDA approval for its ANDA for Terbinafine HCL tablets

Glenmark Pharmaceuticals has informed that the company has received tentative approval from the US FDA for its Abbreviated New Drug Application (ANDA) for Terbinafine HCL 250 mg oral tablets. It is the AB-rated generic equivalent of Novartis's anti-fungal Lamisil tablets with annual sales of over USD 650 million (IMS-Dec-2006) in the US. The company is manufacturing the finished dose formulation at its USFDA approved manufacturing facility in Goa, India. The Company's US subsidiary, Glenmark Pharmaceuticals Inc., USA (GPI) will start marketing the product in the US upon patent expiry (June 30, 2007).

With this approval, GPI now has a portfolio of 16 generic products for the US market and has over 35 ANDAs undergoing US FDA approval process / launch.

Posted by FR at 5:45 PM  


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Investment in equity shares has its own risks. Sincere efforts have been made to present the right investment perspective.The information contained herein is based on analysis and up on sources that we consider reliable. I, however, do not vouch for the accuracy or the completeness thereof. This material is for personal information and I am not responsible for any loss incurred based upon it.& take no responsibility whatsoever for any financial profits or loss which may arise from the recommendations given in this blog.