KEC International wins Rs 130 Crore Project; Current order book at Rs 3300 Cr

KEC International has announced that the company has bagged a contract valued at Rs 130.15 crore from Karnataka Power Transmission Company Ltd for design, fabrication, testing, supply, erection and commissioning of a 400 KV D/C Line. The length of the line is 151.15 kms. This is located in Karnataka.

The project, awarded on a turnkey basis, is to be completed in December 2008.

"This is a significant win for us. Coming, as it does, immediately on the back of our largest single value contract worth Rs 380 crore in Kazakhstan and another Rs 176 crore win in the Middle East, is indeed special," said Mr. Ramesh Chandak, Managing Director, of the Company. The Company's current order book is over Rs 3300 crore.




Govt plans to cut VAT on CFL Bulbs to 4% from 12.5%; Havells says it will act as a demand driver

There are reports that the government may be proposing a cut in the vat rate for CFL bulbs. Sunil Sika, President , Havells India said the move is quite significant. VAT on CFL bulbs may go down to about 5% from 12.5%. CFL bulb comes at Rs 100 per piece. Prices of CFL bulbs may fall as Govt moots VAT cut. The proposal has come in states like Haryana, Chattisgarh and Kerla. However, for pan India it becomes difficult to implement.

The move will not have any significant impact on profit levels, as the benefit will be on passed to customer. Only thing, it will act as a demand driver. As price of a CFL bulb goes down it will help increase demand for the product. Most of the responsible brand owners and marketers will pass it on to customers, Sika further said.

Havells has acquired SLI Sylvania's lighting business for $ 300 million. Sylvania is one of the largest lighting companies globally. Combined turnover of the 2 entities will be around $ 1 billion. Regarding that, Sika said on 31st march we have already done $ 1 billion turnover. It has been just 3 months of acquisition of Silvania.

Total GLS consumption in the country is around 800 million units. Out of that, CFL is only 5% of the marker size. If the penetration level of CFL touches 20-25%, we will have to produce 3-4 times more bulbs than what we produce today, Sika added.






HMT to foray into railways, defence & aerospace, in talks with Polish, German & American firms for technology acquisition in 8-10 areas

HMT is planning to foray into strategic sectors of railways, defence and aerospace and is negotiating with foreign firms to acquire technology for the purpose, reports say. HMT Chairman and Managing Director A V Kamat told that the city-based company is in talks with Polish, German and American firms for technology acquisition in eight to ten areas.

"We have to bring in new technology useful for defence, railways and aerospace. We are going to bring in technology as a joint working partnership with some outside companies," he said.

HMT is trying to acquire technology including high-speed machining centres and special machines for the three strategic sectors. The acquisitions would be done either by way of forging joint venture or entering into technology transfer agreements by paying royalties. Kamat said two-three deals are expected to be signed by the end of the current financial year.

"This year we will be getting orders worth Rs 300 crore from new technologies and partnerships," Kamat said.

HMT, which has six subsidiaries including for machine tools, tractors and watches businesses, clocked Rs 611 crore turnover in 2006-07. The company targets to achieve Rs 900 crore turnover in the current fiscal, he said. It plans to launch at least two tractor variants this year. Its annual tractor sales are around 10,000 units. The company has submitted a Rs 50 crore revival plan for its tractor business, he said.

Kamat said HMT is increasing its product basket. The company also plans to offer voluntary retirement scheme to 3,000 employees - including 1,000 each in machine tools and watches businesses - over the next three years, that would bring down its total headcount to a healthy 7,000.

The company is among 12 other public sector enterprises under the Department of Heavy Industries, which have been sanctioned Rs 77.25 crore by the government last week to liquidate wage and other arrears. HMT is also planning to sell some of its assets to fuel expansion activities, he said.






Reliance Industries spurts to new highs, Mkt cap inches closer to 2.5 lakh Cr; Takes index up almost 240 points

Reliance has touched an intra day high of Rs 1,790.70 and an intra day low of Rs 1,726.25. Currently, the share is quoting at Rs 1,788.10, up Rs 68.75, or 4%. It is trading with volumes of 3,348,270 shares, compared to its 5-day average of 425,207 shares, an increase of 687.44%. Yesterday the share closed up 0.94% or Rs 16.05 at Rs 1,719.35.

The 52-week high for the stock is Rs 1800 on the NSE and Rs 1785 on the BSE. The spurt in the stock has also resulted in the Sensex zooming almost 240 points. The current market cap of the company works out to almost Rs 2.49 lakh crore.





JSW Steel kicks-off expansion project at Vijayanagar facility

JSW Steel Ltd, the country’s fourth largest integrated steel manufacturer, today set in motion the capacity expansion project at its plant in Vijaynagar. Once completed by 2010, this state-of-the-art facility will be able to produce 10 million tons per annum (MTPA). It will involve an investment of Rs 7000 crores.

The completion of this initiative will also make JSW Steel the largest production facility in a single location. The increased capacity would add more value to the company’s strategy in catering to the growing demand from the domestic and export markets.

At present, the Vijayanagar plant has an installed capacity to produce 7 MTPA of steel. The project would involve latest equipment being installed at this facility, it would also include the largest blast furnace in India being set up here.

Mr. Sajjan Jindal, Vice-Chairman & Managing Director, JSW Steel, said, “India’s thrust on infrastructure development will continue to drive the demand for steel in the coming years. The growing fixed asset investments in the emerging economies will see a growing demand for steel. Moreover, the rural markets in India are yet untapped for their potential. We see a huge opportunity for growth in this market.”




Planning to come up with 16 SEZs, have already got approval for 12: Pradeep Jain, Chairman, Parsvnath Developers

Pradeep Jain, Chairman, Parsvnath Developers, said that the company is planning to come up with 16 SEZs and have got approval for 12. The company expects to start 5 SEZs within few months. The company is also going for land acquisition for 7 SEZs is on and will apply for Govt nod soon. In the next 2-3 months, the company proposes to get approval for the same.

He further said that the company is looking at overseas markets aggressively for expansion. For this, the company is exploring Singapore, Mauritius and London markets. The company is in talks with local developers in these countries.

The company has 20 properties in the hospitality sector across the country. The company is to conclude a tie up for the hotel business in next few days. For this, there will be no equity dilution or stake sale in JV.

As on Mar 31 2007 , total land bank of the company is 153 mn sq ft. In this, 170 mn sq ft will be added via SEZs in the next few months. Post SEZ approval, total land bank of the company will be about 320 mn sq ft. There is an uptick in demand seen, he finally added.




Hindalco Industries makes smart gains; Global consolidation helps

Hindalco has touched an intra day high of Rs 177.40 and an intra day low of Rs 167. Currently, the share is quoting at Rs 175.50, up Rs 11.00, or 6.69%. It is trading with volumes of 3,387,267 shares, compared to its 5-day average of 1,925,464 shares, an increase of 75.92%. Yesterday the share closed up 6.16% or Rs 9.55 at Rs 164.50. Analysts are banking on hopes of stronger commodity prices and expectations of consolidations in the industry on reports of a friendly bid from Australia's Rio Tinto for Alcan Inc.

Anglo-Australian mining giant Rio Tinto has tabled an all-cash offer for Montreal-based Alcan Inc. valued at US$ 38.1-billion. The friendly takeover deal will create the world's biggest aluminum producer. Alcan's board of directors has unanimously recommended that shareholders accept Rio Tinto's all-cash offer of US$ 101 per share. The offer represents a premium of 32% over the current share value of US$ 76.03.

The new company will be called Rio Tinto Alcan and will be based in Montreal and headed by Dick Evans -- the current president and CEO of Alcan. In a statement released Thursday, Evans said the merger will create "a new global leader in the aluminum industry.''

"As we move ahead together, we will remain true to our shared values, including commitments to the environment, health, safety and sustainability, and our focus on creating value,'' Evans said. "I am personally delighted and excited by the opportunity of leading the new larger aluminum group, Rio Tinto Alcan."

The deal comes as Alcan had been trying to fend off a hostile US-billion takeover bid from Alcoa Inc., based out of Pittsburgh. Rio Tinto employs about 4,300 people in Canada and has 32,000 workers worldwide. The London-based company plans to take the bid before regulatory authorities before July 23. The deal will need the approval of two-thirds of shareholders to be approved. Alcan has 68,000 employees and operates in 61 countries.




India Infoline to dilute 40% in retail finance firm, retail business is valued at Rs 800-1000 Cr

India Infoline, one of the leading retail brokerage houses, is venturing into the consumer finance business in a big way. The company is looking for private equity funding or a strategic partner for its new venture, India Infoline Finance Holding (IIFH). The newly formed holding company for retail financing business will be valued at Rs 800-1000 crore.

India Infoline will infuse around Rs 200 crore into IIFH directly, and around $ 100 million would be raised either through private equity or stake dilution to the extent of 30-40 per cent. Sources said that negotiations are in an advanced stages with prospective investors. The company is banking on a huge network of 540 branches across the country and a ready retail clientele. Indiainfoline has called off its partnership with DSP Merrill Lynch, which was holding equity in India Infoline. Senior employees of Citi Financial Group, who had joined DSP are now with India Infoline. They include Apul Nayyar, formerly head of mortgage business, Citi Financial and Manoj Viswanathan, former head of branch network at Citi Financial.

India Infoline has four companies – India Infoline Investment Service Company – for margin funding and SME financing, India Infoline Distribution Company for distribution of retail loan products, Moneyline credit for consumer finance and a housing finance company. The holding company is a subsidiary of India Infoline. After the dilution of equity, the holding company’s net worth will be Rs 600 crore, which is more than some of the private sector banks. This amount can be leveraged by six to seven times and even outstanding loans can be securitised to generate further business. Four finance companies whose holdings have been transferred to the holding company will be valued by a chartered accountancy firm. Eventually, the newly created finance company can be listed on bourses. The range of products and areas for financing could be expanded to micro finance, SME finance etc.

India Infoline is not the only company to form a holding company for separate subsidiaries engaged in various financial services. The Tata group and ICICI Bank have already done the same.




Sobha Developers to bid for slum redevelopment

Sobha Developers Ltd, the Bangalore-based high-end luxury apartment and commercial property developer, is planning to bid for slum redevelopment projects in Mumbai. The company, better known for high-profile office complexes for the likes of Infosys Technologies Ltd., plans to tieup with local partners in Mumbai to bid for properties to be developed under the slum rehabilitation scheme.

Mumbai, which has a population of around 20 million, is also home to Asia’s largest slum Dharavi. Sobha is talking to other builders for partnerships as it seeks to bid for projects under Mumbai’s Slum Rehabilitation Authority (SRA) scheme, according to J.C. Sharma, managing director of Sobha, who declined to name the potential partners.“We are looking at developing land in and around Mumbai. We are looking at bidding for SRA as well. The additional floor space index (FSI) which you get under SRA is a good incentive,” says Sharma.

While Sobha has a presence in nine cities and is looking at expanding operations to another 5-6 cities, it does not qualify to bid for SRA projects here on its own as it has not worked on redeveloping slums anywhere in the country.
As per SRA rules, a developer must have successfully completed a minimum of one housing/township development project covering at least 400,000 sq. m and with a minimum built-up area of 70 lakh sq. ft. "Since we don’t qualify on our own, we are talking to many companies to partner with, the company we are looking at partnering with need not be a Mumbai-based company,"says Sharma.

"The only cost a builder has to bear is the construction," says a realty stock analyst with Enam Financial Consultants.

"It does make eminent business sense, especially from the point of view of a luxury project development, such as the Dharavi redevelopment project that falls in a prime locality between Bandra Kurla complex and the Lower Parel mill district. Projects there will cater to high-end property buyers," predicts Anuj Puri, chairman and country head of Jones Lang LaSalle Meghraj.




L&T's Construction Group Bags Contracts Worth Rs 853 crores

Larsen & Toubro Ltd has announced that the Company has bagged contracts worth Rs 853 crores.

The Company has secured an order valued at Rs 366 crores (USD 91 million AED 330 million) from the Abu Dhabi Water & Electricity Authority for Design, Supply Installation and Commissioning of the two 132/22 kV substations at Saadiyat Island, Abu Dhabi with Mott MacDonald as Consultant to the project. Saadiyat is one of the several desert island destinations, which are currently being developed by the Emirates of Abu Dhabi.

Each Substation consists of 132 V Gas Insulated Switchgear 22 kV Gas Insulated Switchgear 63/80MVA 132/22 kV Transformers, Substation Control & Monitoring System, Protection & Telecommunication System, DC System & auxiliaries and Substations. The Contract also encompasses design and construction of the substation buildings together with the associated utilities. The Contract will be completed within 18 months.

In another significant development, has secured yet another order for turnkey construction at 400/220 kV Extra High Voltage Substations valued at Rs 200 crores from the Power Grid Corporation of India Ltd (PGCIL).

One of these major substation is to be located at Gurgaon (Near Delhi) will be 400/220 kV Gas Insulated Substations. The other Air Insulation Substations will be located at Bhinmal and Kankroli in Rajasthan and Zerda in Gujarat.

The scope of work includes supply, erection testing & commissioning of 315 MVA transformers, 400 kV Reactors, Substation Automation & Protection System and total Civil & Air-Conditioning works. The company has a long standing association with PGCIL in their various turnkey ventures involving transmission lines, substations & distribution.

The company is currently doing more than 12 projects for PGCIL at various locations, ECC. The company's Construction Division will execute both of these projects. ECC's Water and Utilities group has also bagged three orders valued at Rs 287 crores.

Tamil Nadu Water Supply and Sewerage Board awarded an order for Rs 195 crores for implementation of comprehensive water supply schemes in Ramanathapuram, Sivagangai and Pudhukottai districts in Tamil Nadu.

The water project in Tamil Nadu includes supply, install, testing and commissioning of Mild Steel and Pre-Stressed Concrete pipelines. Scope also includes construction of storage reservoirs and electro-mechanical works. This project is to be completed in 18 months.

Delhi Jal Board (DJB) awarded an EPC order of value Rs 92.50 crores for design, providing, laying, jointing, testing and commissioning of 22 km of 1200mm Diameter mild steel raw water Transmission Main from Wazirabad Raw Water Pump House to proposed Water treatment Plant at Okhla.

DJB shall be able to pump 22 MGD raw water to the Water Treatment Plant at Okhla and shall be distributed to Outer Delhi and South Delhi. This project is to be completed in 20 months.

Recently, the Govt. of Andhra Pradesh placed an EPC contract valued at Rs 332 crore on the Company and its JV partner for a lift irrigation project in Cuddappah district to be executed in 24 months, taking the total tally of water projects to Rs 561 crore during the current year.

Larsen & Toubro currently has orders worth around Rs 40,000 crores as of June 30. The company had also earlier in the week won a Rs 542 crore order from state-run Indian Oil Corp for construction and upgrade of its motor spirit quality unit to Euro IV norms at its refinery in Panipat, in the northern Indian state of Haryana.