Breaking News & Stocks

Tatas pick up 60% stake in Spanish firm

Mumbai, April 04: Sealing its second acquisition in a week, Tata group company, Telcon, on Friday said that it has signed a deal for acquiring a 60 per cent stake in Spanish company, Comoplesa Lebrero SA.

An agreement was signed with existing shareholders of Comoplesa, a construction equipment company, to acquire 60 per cent stake in the company, Telcon said in a press release issued here.

The balance 40 per cent will be retained by the existing shareholders who will continue to be associated with the venture, the release said.

Telcon (Telco Construction Equipment Company), a subsidiary of Tata Motors, had acquired over 79 per cent stake in another Spanish company, Serviplem SA, last week. Tata Motors had also acquired the British luxury brands Jaguar and Land Rover on March 26.

Tata Motors holds a 60 per cent stake in Telcon with the remaining 40 per cent held by Japan`s Hitachi Construction Machinery Company.

Telcon, Hitachi and Lebrero would work together to identify opportunities and leverage their presence in the global market, Telcon Managing Director Ranaveer Sinha said in the release.

The acquisitions would not defocus Telcon from its core business in India, he added. It would help Telcon strengthen and add relevance to last week`s Serviplem deal, Sinha added

Cricket enters NY’s school system

NEW YORK, April 3: Although Pakistani, Indian and West Indian communities have been playing cricket in New York City for years, it was never accepted as a recognised team sport here until Wednesday when it was incorporated in the city school system.

The New York City’s Department of Education made cricket its newest league sport, with about 600 high school students playing on 14 teams during a 12-game season.

A spokesman for the education department said New York’s was the only public school system in the United States to offer competitive cricket as a team sport like popular games of baseball, basketball and football.

The first cricket matches were played in the borough of Queens school district, a hub of the South Asian communities.

The New York state’s department of parks and creation is also holding a cricket tournament in June at a park in Brooklyn.

China asks US for level playing field

Beijing, April 4: China has asked the US to lift trade and investment barriers targeted at it, including restrictions on export of high-tech products.

Trade imbalance has been a sticky point in US-China economic ties. Beijing also says that US curbs on exports of a number of high-tech products to China citing security reason was a major factor for the US trade deficit.

During a meeting, Chinese Premier Wen Jiabao told US Treasury Secretary Henry Paulson that Beijing hoped Washington would loosen restrictions on exports to China and would lift other economic barriers to promote sound and stable bilateral economic and trade relations, the state media reported.

The two had a meeting on Thursday as Paulson, the first American top official to visit China after the unrest broke out in Tibet, wrapped up his two-day trip to prepare the ground for the next round of Strategic Economic Dialogue between the two countries in Washington in June.

Wen said the bilateral cooperation in the areas of trade, investment and finance had developed to a very high level. China had taken "active measures" to address its trade imbalance with the US and they had already shown "some positive effects", the Chinese Premier said, according to official Xinhua news agency. During the 40-minute meeting, Paulson also briefed Wen on the US Economy, the state-run China Daily said.

HSBC exec sees need for common bank rules: Report

Milan, April 04: The chairman of HSBC Holdings Plc, one of the world's biggest banks, said common rules among regulators would help them deal better with crises like the one that had struck banks in recent months.

In an interview published in Italian business daily Il Sole 24 Ore on Friday, Stephen Green said the case of Britain's Northern Rock showed how a single regulator was not capable of supervising a bank with international activities.

"The lesson from the credit crisis is that supervision by a national regulator is not enough," he was quoted as saying.

But Green did not see the need to create a transnational regulatory body to supervise banks whose activities stretch across borders, as suggested by Charlie McCreevy, the European Union's internal market commissioner.

"I don't think there is a need for special new law on banks," he said. "I think it is enough that the regulators adopt common policy standards (and) talk periodically to each other about big banks.

"This model (already) works and could serve as reference point for the continental banking system."

European Union finance ministers and central bankers meet in Slovenia on Friday and Saturday to discuss what regulatory changes are needed in light of the credit crisis. Earlier this week, banks UBS and Deutsche Bank took a combined USD 23 billion hit on their risk assets.

Green said the credit crisis was not a failure in corporate governance but errors taken by managers. He said central banks had done a good job in dealing with the crisis but banks had to clear up their accounts without hesitation.

Any attempt to find a short cut to the crisis only risked prolonging it, he said.

"There are no magic formulas and the quality of a bank's accounts is measured by concrete parameters," he said, citing capital ratios and liquidity.

Green also supported the U.S. Federal Reserve's rescue of Bear Stearns, a move that Chairman Ben Bernanke had to defend before a Washington committee on Thursday.

"It was a responsible move. An inevitable decision," he said.

Stocks Mostly Rise After Jobs Report
Friday April 4, 9:09 pm
Most Stocks Up After Report of 80,000 Jobs Lost in March; Some Investors Feared Bigger Decline

NEW YORK (AP) -- Wall Street showed some reassuring signs of stability Friday, closing mostly higher despite the biggest monthly decline in jobs in five years. The major indexes ended the first four sessions of the second quarter with a healthy advance.++
While some nervous investors fled to government bonds, the report, showing the economy gave up 80,000 jobs last month, appeared to simply confirm many investors' assumptions of a widespread economic slowdown.

Although the job losses, the most since March 2003, are indeed a significant sign of economic weakness, a lackluster report was widely expected, and some investors were relieved the total was not higher. Thomson/IFR had projected 15,000 jobs were lost in March, but some economists expected 150,000 cuts.

Payrolls for January and February were revised lower by a total of 67,000 and the unemployment rate shot up to 5.1 percent, the highest since September 2005. The economy has given up about 232,000 jobs in the first three months of this year, and the latest report adds fuel to the belief of many economists that the U.S. is already in recession.

"The economic data is negative, but I think what the market's telling us is we've priced in a lot of the bad news already," said Arthur Hogan, chief market strategist at Jefferies & Co. "You could make the argument that we've thrown a lot of difficult news at this market and it's reacted very well."

The market's next big test is likely to come with the release of first-quarter earnings reports in the coming weeks. Investors will be particularly keen to know what companies' outlooks are for the rest of this year -- if they are disappointing, Wall Street could see a return of the punishing volatility of the past few months.

The Dow Jones industrial average slipped 16.61, or 0.13 percent, to 12,609.42, in part because of a decline in General Motors Corp. stock.

Broader stock indicators edged higher. The Standard & Poor's 500 index added 1.09, or 0.08 percent, to 1,370.40, and the Nasdaq composite index advanced 7.68, or 0.32 percent, to 2,370.98.

Though the major indexes showed modest moves, advancing issues outnumbered decliners by about 3 to 2 on the New York Stock Exchange, where consolidated volume came to 3.59 billion shares compared with 3.77 billion traded Thursday.

For the second quarter, which began Tuesday, the Dow is up 2.83 percent, the S&P 500 gained 3.61 percent, and the Nasdaq added 4.03 percent. For the entire week, the Dow rose 3.22 percent, the S&P 500 added 4.20 percent and the Nasdaq gained 4.86 percent.

Treasury prices jumped after the jobs report, as investors often seek the safety of government-backed bonds amid uncertainty about the economy. The yield on the benchmark 10-year note, which moves opposite its price, fell to 3.47 percent in late trading from 3.59 percent late Thursday.

The dollar was mixed against other major currencies, while gold prices rose.

Light, sweet crude rose $2.40 to settle at $106.23 a barrel on the New York Mercantile Exchange. Retail gas prices, meanwhile, surged to a new record above $3.30 a gallon, and appear ready to rise further as supplies tighten ahead of the summer driving season.

Investors' assessment of the economy comes after a strong week for Wall Street. Monday brought the welcome end to a downbeat first quarter. While the S&P 500 fell nearly 10 percent during the first three months of the year, stocks had managed to pull off their lows by quarter's end.

On Tuesday, the Dow surged nearly 400 points as investors snapped up shares of financial companies, which have fallen sharply in recent months on concerns about bad debt on balance sheets. The quiet sessions since, including Friday's modest moves in the face of bad economic news, appeared to buoy some hopes that the market is carving a bottom after five months of declines in the S&P.

Friday's advance followed a gentle rise on Thursday in response to Federal Reserve Chairman Ben Bernanke's remarks that the Fed expects to recover most, if not all, the $29 billion worth of loans it made to keep struggling Bear Stearns Cos. from collapse. Bernanke's comments to the Senate Banking Committee, in which he defended the central bank's decision to aid JPMorgan Chase & Co.'s takeover of Bear Stearns, were calming to investors hoping that demand is returning to the tight credit markets.

Other central bankers and business leaders appearing before the committee indicated they were able to avert a financial catastrophe with Bear Stearns sinking quickly toward bankruptcy.

Remarks by Bernanke earlier in the week left the door open to another interest rate cut from the Federal Reserve.

"This (jobs) number still supports the notion that there's likely going to be more monetary policy easing by the Fed," said Michael Strauss, chief economist at Commonfund, noting that investors appear to be considering that the central bank's steps often take time to filter into the economy.

Figures like employment numbers also lag, noted Hogan. "The unemployment rate will go higher before the recession is over," he said. "I think the market is trying to tell us we understand that, we've seen this before"

"I think there are market participants who are looking through the valley and saying they're seeing the other side," he added.

In corporate news, GM fell after a private equity group said it terminated its agreement to invest $2.55 billion in the company's largest auto parts supplier, Delphi Corp., which has been trying to emerge from bankruptcy protection. GM fell $1.01, or 4.7 percent, to $20.58.

On Friday, the Russell 2000 index of smaller companies rose 0.16, or 0.02 percent, to 713.73.

Overseas, Japan's Nikkei stock average fell 0.72 percent. Britain's FTSE 100 finished up 0.95 percent, Germany's DAX index rose 0.32 percent, and France's CAC-40 added 0.27 percent.

Associated Press Business Writer Eileen AJ Connelly in New York contributed to this report.

The Dow Jones industrial average ended the week up 393.02, or 3.22 percent, at 12,609.42. The Standard & Poor's 500 index finished up 55.18, or 4.20 percent, at 1,370.40. The Nasdaq composite index ended the week up 109.80, or 4.86 percent, at 2,370.98.

The Russell 2000 index finished the week up 30.55, or 4.47 percent, at 713.73.

The Dow Jones Wilshire 5000 Composite Index -- a free-float weighted index that measures 5,000 U.S. based companies -- ended Friday at 13,823.80, up 568.66 points, or 4.29 percent, for the week. A year ago, the index was at 14,595.10.

news heard ? south africa declared inning. india will bat. mistake again now by smith .he has to pay for it.

Union Bank launches "Union Reverse Mortgage Scheme"

Bangalore, April 04: The Union Bank of India on Friday launched its "Union Reverse Mortgage Scheme", a loan product designed exclusively for the benefit of senior citizens.

The bank is the fourth in the country to launch the scheme through which the loan seeker need not worry about re-payment and be assured of monthly income, the bank's Bangalore zone field General Manager L N V Rao said to a press meet here.

The loan will be available to homeowners who are 60 years of age or more and can be availed jointly with the spouse, provided he or she is more than 55 years old, he said.

Unlike other loan products, there is no income criteria to be met for availing loan. On the demise of the last surviving owner, the legal heirs have the right to repay. If they do not wish to do so, the bank will sell the property, set off the loan outstanding. The surplus, if any, will be given to legal heirs.

The minimum loan amount that can be availed is Rs one lakh and maximum Rs 50 Lakh, Rao said. Seventy per cent of the assessed value of the building would be the loan amount.

The maximum tenor of a loan under this scheme is 15 years. The loan carries a fixed interest of 10 per cent per annum.

Typically, for a loan of Rs 10 Lakh, the monthly pay off to the onwer on ten year loan will be Rs 4880 and on a 15 year loan, it will be Rs 2410, Rao said.

The property is revalued every five years and adjustments will be made to the monthly payments accordingly, he said.

Rao said the borrower has to comply with certain conditions which include that he bear the cost of property insured against fire, earthquake and other calamities.

If the borrower ceases to stay in the house which has been mortgaged, the loan will be cancelled.

Deora to meet Pak, Iran officials on gas pipeline issue

Mumbai, April 05: Union Petroleum Minister Murli Deora on Saturday said he would be discussing the Iran-Pakistan-India gas pipeline issue with both Iranian and Pakistani officials soon.

The minister, while addressing reporters, said he would be meeting officials of both countries on April 23.

"We hope to resolve the issue soon," Deora said, adding that the meeting is expected to take place in Pakistan.

According to him, there were not many differences between the parties concerned.

"There are only some pricing and cess issues to be discussed," Deora said.

Steel price hike could affect Nano's Rs 1 Lakh tag
5 Apr, 2008, 0348 hrs IST

MUMBAI: Hit by a 30-40% hike in auto-grade steel prices, vendors of Tata Motors' Nano are seeking higher rates for their parts from the company, a move that threatens to put the car's celebrated 1-lakh tag in jeopardy. Tata Motors, on its part, insists the car's standard version would cost Rs 1 lakh.

As steel comprises 60-65% of a car's value-industry estimates that an entry-level model consumes 500 kg of the metal-even a marginal increase could have cascading effects on auto part costs. Vendors say rising input costs have offset the already wafer-thin margins they were working on. "It will no more be a viable proposition for us if prices for components are not re-negotiated. Steel prices have escalated enough to erode all our profits," said Sriram Pistons (a Nano supplier) chief executive Ashok Taneja.

If vendors do have their way, Tata Motors could end up with a higher bill for component buys, which it will have to recover anyhow.

But the company is steadfast on its Rs 1-lakh tag. A Tata Motors spokesperson told ET: "On January 10, Mr Ratan Tata had publicly announced that the price of the Nano would be a hundred thousand (Rs 1 lakh). And it would be that. We will not go back on our word, whatever be the market situation."
Tata Motors could also be helped by its conscious decision at the time of the Nano's conceptualisation to use other materials instead of steel in building the car. The company has also used a lighter variety of steel and plastics or aluminium, wherever possible, to cushion the impact of ballooning prices. Also, only the standard or base (non-AC) version of the Nano would cost Rs 1 lakh.

Key vendors, meanwhile, have begun hectic parleys with the Tatas. Says Surinder Kapur of Sona Koyo Steering Systems, which is supplying steering systems for the car: "Steel prices will affect costs of our supplies for Nano. We really wouldn't want the car's price to escalate. But in the given scenario, we are talking to Tata Motors."
The Nano project, incidentally, has 100-odd vendors.

Many are working on sheer margins to help the company meet its goal of launching the lakh car. These firms are hoping that a lower price tag will translate into a huge demand for the world's cheapest car, helping them make bigger profits.

But that is easier said than done. If the vendors do hike prices, it will impact Nano's tag too. And if the Tatas decide against passing on the increase to the customer to keep its promise, it will take a hit on its own profitability. And it's not just components, even Nano's body is made of steel.

Said Dilip Chenoy, director-general of the Society of Indian Automobile Manufacturers (SIAM), "The rise in the steel prices by 30-40% would negate the 8-9% excise reduction announced in this Budget. As per our estimates, the rise in steel would surge the prices of vehicles too."

There are three categories of steel used by the automotive industry. Long (used for making forged components), flat (hot/cold rolled and plates for making bodies of vehicle) and pig iron (used by foundries for making cast components). While the flat and long products saw a 25% price hike since February, pig iron rates have surged 40%.
An analyst said he expected prices could rise around 10% by April- end. "Around 70% of the cost for the automotive industry goes for bought out items. Steel accounts for most of it."

According to the SIAM figures, steel content in an entry-level passenger car is about 500 kg. So even a marginal price hike impacts the automotive industry significantly.

Plastics is another key input. Deepak Jain, director of Lumax Industries, which is supplying light system for the Nano said: "Increasing steel prices would affect all companies across the auto segment. If one has to keep orders feasible, prices have to be increased. There's no other way."

Rail ride to Chandigarh from Delhi in 50 mins flat?
4 Apr, 2008, 1302 hrs IST............

NEW DELHI: Imagine reaching Chandigarh after a only a 50-minute train ride. If the Indian Railways are to be believed, this might soon be possible. The railways have released the ‘request for proposal’ (RFP) for the appointment of a consultant for pre-feasibility study on the construction of the High Speed Rail Corridor between Delhi and Amritsar through Chandigarh. The RFP, released on Tuesday, states that ‘‘ the need of the hour is faster movement of both passenger and goods.

In the case of passenger traffic, the boom in the airline sector... reflects upon the premium paid to the shorter transit times between cities. A high speed passenger railway system will thus usher in a new transport product... and also fill up a vacuum in the current passenger scenario.’’

According to officials, the consultant will prepare a report to evaluate the financial viability and technical feasibility of construction, maintenance and management of facilities on the corridor. It will be built through public private partnership .‘‘ We have fixed on April 24 for our prebid conference and the proposal due date will be May 5. The letter of award will be given within the next 40 days,’’said a ministry official
According to railway officials , once the high speed corridor is operational, it will allow trains to travel as fast as 250-300 kilometres per hour. ‘‘ Our system will become comparable with the best in the world. At present, the Rajdhanis and Shatabdis have a maximum speed of around 110-120 kilometres per hour. The fastest train in India, the Bhopal Shatabdi, has a maximum speed of only 150 kilometres per hour. We now have to change the existing tracks and import new coaches that can run on such tracks,’’ added the official.

The official said that the project needed to involve private players as the cost was too high. The railways have also received the green signal from state governments that will chip in. Other corridors in the pipeline are Pune-Mumbai- Ahmedabad and Chennai-Bangalore-Coimbatore-Ernakulum and Howrah-Haldia . Officials have also warned of the existing fares almost being tripled.