6 PSU banks join Rs 1 lakh cr club

Higher credit offtake combined with robust deposit growth saw six public sector banks cross the landmark Rs 100,000 crore figure in business turnover, which includes net deposits as well as advances, in 2006-07.

The six banks that have joined the major league are Syndicate Bank, Indian Overseas Bank, UCO Bank, Oriental Bank of Commerce, IDBI Bank and Allahabad Bank.

State Bank of India (SBI) tops the chart of large-sized banks, with a total business turnover of Rs 772,858 crore, followed by Canara Bank (Rs 240,887 crore), Punjab National Bank (236,456 crore), Bank of Baroda (Rs 2,08,537 crore), Bank of India (Rs 204,817 crore), Union Bank of India (Rs 147,566 crore) and Central Bank of India (Rs 134,572 crore).

This took the total number of public sector banks that have surpassed the Rs 100,000 crore mark at the end of March 2007 to 13 against seven banks in 2005-06. With the Indian economy growing at a rapid pace, both deposits and advances have increased significantly during 2006-07.

The aggregate business turnover of public sector banks rose almost 26 per cent during the year compared with last year, while the total business volume rose by 7,05,713 crore to Rs 34,34,322 crore as on March 31, 2007.

The aggregate deposits of public sector banks rose 23 per cent to Rs 19,94,200 crore against Rs 16,22,481 crore, while bank credit recorded a robust growth of 30 per cent to Rs 14,40,123 crore compared with Rs 1106128 crore last year.

With rising inflation, interest rates rose across the board during the fiscal. Interest rates on deposits of major public sector banks over one-year maturity increased from 6-7 per cent in March 2006 to 7.5-9 per cent (as per the RBI Weekly Statistical Supplement) in March 2007.

While the increase in lending rates had a moderating impact on credit growth, the jump in deposit rates created favourable conditions for deposit growth.

Vijaya Bank, United Bank of India, Bank of Maharashtra and State Bank of Travancore crossed the Rs 50,000 crore mark to join the league of mid-sized banks.

Source: Business Standard /Swapnil Mayekar / Mumbai June 26, 2007

UTI Bank puts off $600m GDR

Move to give promoters more time to take a call on the issue.

UTI Bank, a mid-sized private sector bank, has deferred its $600 million global depository receipts (GDR) issue as well as the simultaneous preferential offer to its promoters.The bank said the decision to put off capital raising plans was taken in order to provide promoter shareholders - Specified Undertaking of Unit Trust of India (SUUTI), Life Insurance Corporation and General Insurance Corporation - more time to take a call on subscribing to the preferential offer.SUUTI is the largest shareholder in UTI Bank with 27.43 per cent stake. LIC owns 10.38 per cent of the bank’s equity and GIC 2.38 per cent.In a statement released after the bank’s extraordinary general meeting (EGM) here today, UTI Bank said the special resolutions on raising capital have been deferred “to provide promoter shareholders further time for consultation” on the preferential share offer.The shareholders would again meet on July 13 to consider the plans to raise capital. The shareholders, however, passed a resolution increasing the bank’s authorised capital to Rs 500 crore from Rs 300 crore.Banking sources said LIC, which bid in the recently concluded ICICI Bank’s follow-on equity offer for shares worth about Rs 4,000 crore, has asked for more time to arrange for funds as it was currently experiencing a “tight liquidity” situation.SUUTI, which has already obtained the government’s permission, also needs to arrange for funds to subscribe to its portion of the preferential offer.While SUUTI would need to pay about Rs 1,300 crore to subscribe to 20.3 million shares being offered on a preferential basis, LIC requires about Rs 450 crore for 7.6 million shares and GIC around Rs 50 crore for about 0.7 million shares.If the shareholders had passed the resolutions today, the promoter shareholders would have had to subscribe to the preferential offer within 15 days from the commencement of the EGM, in accordance with the Securities and Exchange Board of India (Sebi) guidelines. There is no provision for part payment in a preferential allotment.UTI Bank has already appointed Goldman Sachs and Citigroup as the merchant bankers for the GDR issue. The GDRs are proposed to be listed on the London Stock Exchange.P J Nayak, chairman and managing director of UTI Bank, had earlier said, “We thought making the preferential offer simultaneously with the GDR issue was the fairest way to raise adequate capital and also ensure good corporate governance practice, whereby the existing promoters are given an option to maintain their shareholdings.”

Source: Business Standard BS Reporter Mumbai June 26, 2007

Get online,not in line,to pay tax

2007-06-21 14:41:12
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Paying taxes has never been simpler with the authorities introducing the mechanism of online payment. The use of electronic means to deliver services is not only an efficient and speedy process, but it also facilitates a transparent process for disseminating information and delivering it to the taxpayers of the nation, says the Economic Times.

Online payment of taxes helps you save time, is convenient and is paperless. You could be in office or at home — the facility to pay taxes is just a click away. To use of this facility, all you need is an account with a bank that offers net banking and e-tax payment facility. SBI, HDFC Bank, IDBI Bank, UTI Bank and Union Bank of India are some banks that provide the e-tax payment facility.

The procedure for payment of taxes online is simple and the user-friendly instructions make it even more attractive. To start with, you need to log on to NSDL-TIN website (www.tin-nsdl.com) and click on the ‘e-Tax-online payment’ option. You will then be directed to a list of banks that provide the e-tax payment facility. Click on the option for your bank and choose the applicable tax challan.

If it is a tax deducted at source payment, challan no. 281 shall apply; else challan nos. 280, 282 or 283 shall be applicable. Challan no. 280 is used for payment of advance tax and self-assessment tax. Challan no. 282 is used for payment of miscellaneous taxes like gift tax, wealth tax, estate tax, expenditure tax etc. Challan no. 283 is used for payment of fringe benefits tax or banking cash transaction tax.

On opting for the challan type applicable, particulars such as the permanent account number (PAN) or tax deduction account number (TAN) as may be applicable, name and address of the taxpayer, relevant assessment year, type of payment and name of the bank will be displayed.

These particulars will need to be filled in carefully as an incorrect PAN/TAN (if it does match the records of the income-tax department) will not allow further processing of the payment. The mandatory fields are highlighted and to ensure smooth processing, these fields need to be populated. You will then reach the net-banking site provided by your bank where you hold your account and with the use of the allocated customer ID and password, the payment will be processed.

Once the process is complete and the bank processes the online transaction, you will be issued an acknowledgment indicating the challan identification number (CIN). After a week of making the payment, the status of the payment may be verified at the NSDL-TIN website under section ‘Challan Status Inquiry’.

You can also verify the payment of taxes through an online bank statement. Apart from being relieved of the hassles of visiting the bank for paying taxes and the additional paper work, an added advantage is that online payment does not require attaching the acknowledged counterfoil with your return.

Quoting the challan identification number is sufficient proof for the tax authorities. Imagine, not having to worry about the challan copies and the related paperwork. As for security concerns, the authorities assure the taxpayers that the transmission through the NSDL-TIN website is encrypted and is with the secure socket layer authentication.

SBI, LIC, others to dilute 50% in UTI MF via IPO

UTI AMC will be the country’s first domestic mutual fund to go for an IPO, through which sponsors will make a partial exit

Kolkata: UTI Asset Management Company will float an initial public offer by March-end next year to help its sponsors, SBI, LIC, PNB and BoB, offload up to 50%.
UTI Asset Management Company Ltd chairman and managing director U K Sinha told PTI that the board of the company had recently approved the proposal to offload up to 50% stake held by the four sponsors.
State Bank of India (SBI), Life Insurance Corporation of India (LIC), Punjab National Bank (PNB) and Bank of Baroda (BoB), individually hold 25% stake each in the asset management firm.
Sinha said UTI AMC would probably be the first domestic mutual fund in the country to go for an IPO, through which the four sponsors would make a partial exit.
He said the details on the valuation of the company were being worked out.
The valuation of the firm was last done in November 2005, when the four sponsors bought stake in it.

Source: PTI

Rupee world's favourite currency

NEW DELHI: Sabse bada rupaiya. The Reserve Bank of India is going to find it increasingly tough to prevent the rupee from appreciating, if the growing appetite for the rupee in different parts of the world is anything to go by. For instance, the US-based Inter-American Development Bank (IADB) raised rupee-denominated debt worth Rs 150 crore money in the Japanese market in May. The issue was of 10-year bonds offering an interest rate of 8.25%, with payments to be settled in dollars. It had raised a smaller amount for three years in February at 7.25%. The transaction is only a pointer to the growing strength of the rupee, which is fast gaining the confidence of investors across markets. The IADB floated a rupee-denominated dollar settlement issue after Japanese investors insisted on holding rupee assets, said an official. The dollar value at redemption would depend directly on the valuation of the rupee. This debt issue is significant because it was floated in a mature market, signalling that even investors in developed economies are now betting on the rupee. Says Vineet Gupta, head-local credit analysis, Calyon Bank, “Every investor wants India in his portfolio and the global demand for rupee-denominated assets will continue to strengthen. This comes on the back of high growth in the economy and the appreciating rupee.” The rupee has appreciated by a whopping 8.78% since January this year, from 44.2 per dollar on January 1 to 40.63 per dollar on Thursday. Rupee-denominated debt instruments floated outside India cannot be settled in rupees since the Indian currency is not fully convertible. The underlying valuation of the transaction is driven by the rupee even though the settlement is in dollars. This implies that at the time of settlement of the loan, the borrower will pay back the dollar equivalent of the rupee. Since the expectation is that the rupee would appreciate against the dollar, the lender expects to get back more dollars per rupee lent. For instance, if at the time of the debt issue, the rupee is trading at Rs 41 per dollar and the issue size is $100 million (Rs 410 crore) and at the time of repayment, the rupee is trading at Rs 40 per dollar, then the final valuation of the settlement will vary according to the rupee and the borrower will have to pay back $102.5 million (4100/40). Thus, an investor would opt for a rupee-denominated paper to gain from a higher dollar return at the time of repayment, owing to the appreciation of the rupee. This appreciation has led to increased demand in global markets for rupee-denominated assets. Industry sources said a couple of months ago, there was a similar issue of rupee-denominated bonds, with settlement in dollars in London to finance a takeover deal of a company. In fact, Dubai launched rupee-dollar futures contracts that will be traded on the Dubai Gold and Commodities Exchange (DGCX) on Thursday.

source: Times News Network

Media stocks attract FIIs

FIIs and global investors seemed to have taken an increased interest in media and entertainment sector, which has witnessed growing advertising revenues.
According to analysts, increasing interest rates and rising rupee have impacted sectors such as automobiles, manufacturing and IT, while also favouring interest insensitive sectors. Analysts feel that media companies' that have invested in television, radio and multiplexes are the only ones that don't seem to have been impacted.
Moreover, growing year on year advertising revenues in both print and electronic media have also accounted for these stocks being currently in favour despite volatility.
Analysts feel buyer interest in media stocks is likely to continue as the television industry is expected to grow by 22-23 per cent and print industry by 13-14 per cent in the next two years.
Another positive trigger is that most media companies' profits have more than doubled in the fourth quarter of the financial year 2007, said an analyst who did not wish to be named.

Emaar MGF likely to invest $ 12 bn in India

DUBAI: Emaar MGF, a joint venture between Dubai-based Emaar Properties and India's MGF Developments, is likely to invest about $ 12 billion in India in the next five years for setting up nine special economic zones and 50 hospitals.
Emaar MGF also plans to add 25,000 hotel rooms throughout the country in ten years, besides establishing schools and universities, residential townships and shopping malls.
"It is our vision to change the way modern India lives and toward this goal we have brought into the country the largest ever foreign direct investment (FDI) in the Indian real estate sector," Emaar MGF Executive Vice Chairman and Managing Director Shravan Gupta told Gulf News.
The company started the expansion programme by laying foundation stone for a township project at Mohali Hills, a satellite town of Chandigarh.
The project will have a capital of Rs 16,000 crore and will include residential plots, town houses, villas and shopping malls, in addition to facilities such as hospitals and IT parks.
Meanwhile, Emaar MGF has received approval for nine SEZs, proposed to be located in states including Haryana, Hyderabad, Tamil Nadu, Andhra Pradesh and Karnataka.
In the hospitality sector, the company plans to build 10 luxury hotels and 45-50 business hotels in 10 years. It's joint venture with Accor will result in 100 budget hotels. In all, it will add 25,000 hotel rooms across India in 10 years.

Source: PTI

Sebi to educate investors

Mumbai: Stock market regulator Sebi will launch a nation wide investors' campaign in the next two months to educate people about the securities market, said M Damodaran, chairman, Sebi. This would be with the help of the major stock exchanges and the state governments.
Addressing retail investors at India Investors Show, Damodaran said, "We will reach out not just to people in the Metros, and only to people in the tier-two towns, but wherever investable surpluses are available."
Sebi will work through the National Institute of Securities Market (NISM) for spearheading the investors' education campaign.
Damodaran said, "We have already tied-up with some large institutions in order that our investors' education programme reach much beyond the metros and tier-two towns", he said.
Stressing on the need of the retail investors' participation in the market, Damodaran said that the participation of the retail investors in the market is necessary for the healthy growth of the Indian stock market in the long-term horizon. It will help the market also to give a reasonable return.

Source: Domain-B

Shareholders should question CEOs' salary: Ahluwalia

New Delhi: Shareholders of family-owned companies should question the quantum of emoluments being drawn by the chief executive officers (CEOs) of their companies, said the deputy chairman of the Planning Commission speaking to Karan Thapar in the programme 'Devil's Advocate' telecast on news channel CNN-IBN.
Ahluwalia further added, "If you look at the ten best performing companies in India... Find out the salaries of top CEOs and then consider how many companies that are performing nowhere near as well are paying there CEOs three-four times that salary.
Ahluwalia said regulation of CEOs salary is a shareholder issue and should be decided by the remuneration committee of independent directors.
Defending the Prime Minister's recent remarks on CEO's salaries he said the PM did not mean that skilled and highly- skilled persons getting a good salary in a competitive market is "something to be objected to," Ahluwalia said. He further added that, "if you have a family controlled business and they owe themselves large salaries it is not necessarily the best thing to do."

Source: Domain-B

Google buys Internet news delivery firm FeedBurner

SAN FRANCISCO: Google announced on Friday that it has bought FeedBurner, a firm specialising in delivering podcasts, weblogs, news and advertising to Internet browsers. Chicago-based FeedBurner is a "web feed" firm that lets online publishers constantly send updated news, commentary and other content directly to readers with tools such as Really Simple Syndication (RSS). "We are thrilled with this acquisition," Google vice president of product management Susan Wojcicki said during a conference call with reporters. "We believe the two companies are very complementary and it will enable Google to bring hundreds of thousands of new sites into AdSense network."

Source: www.timesofindia.com

India largest borrower from WB

NEW DELHI: The World Bank's lending to India will touch $3.8 billion in the 12 months period ending June 30, making the country the single largest borrower from the multilateral financial institution. "World Bank's involvement with India has increased tremendously and the $3.8 billion to be extended till June 30 is the largest amount being extended so far," World Bank executive director Dhanendra Kumar said. Out of the total $3.8 billion, $2.32 billion would be 'zero interest' grants and credit provided by the Bank's International Development Association (IDA), Kumar said. The Bank's lending to India last year was $1.4 billion. He added that half of the $3.8 billion would be deployed for development projects in rural areas. The bank is also expected to approve 14 projects by the end of June and would provide additional assistance for two projects already undertaken, he said.

Source : PTI

Markets to correct in June: Anagram Stock Broking

V K Sharma, analyst, Anagram Stock Broking, said we are heading into a bearish market. “If we look purely at the yesterday’s charts, which doesn’t take into account the closer of S&P 500 at an all-time high and Asian markets today, then it’s a bearish market that we are heading into. The market would definitely do a reversal today and open sharply higher,” he added. Sharma feels that the closure of the day in which the settlement ends is only for history and the current month. “A good close today doesn’t mean that the market is headed for a new bullish heights and a fall doesn’t mean that the next month is bad,” he explained. He believes the markets are heading into a correction in June. “We would look at utilizing any opportunity that comes to lighten commitments rather than going long. We are merely exporting the current months problems into June and the areas in which the open interest has actually been built are the weak areas and where the rollover is high,” Sharma added.

Source: Moneycontrol.com

At 9.4%, GDP growth second fastest-ever

NEW DELHI: The dream run continues. The Indian economy continues to grow at a scorching pace, notching up its second fastest growth rate ever, with gross domestic product (GDP) rising 9.4% during 2006-07. The strong performance was pulled off on the strength of double-digit growth rates by manufacturing and most service sectors, which ensured that the economy grew by over 9% for the second year running despite a measly 2.7% rise in farm output. The fastest GDP rise since 1988-89 — when the economy grew 10.5% — also beats the government’s earlier estimate of 9.2% and puts India second only to China in terms of growth in major economies. With GDP at 1999-2000 prices estimated at Rs 28,48,157 crore, the Central Statistical Organisation, which put out the revised estimates on Thursday, projected that the per capita income went up 8.4% to Rs 22,483 during 2006-07. While the government was pleased with the overall numbers, the slow rise in farm output was a worry. Over half the population still depends on agriculture for a livelihood but the sector’s share in economic activity has declined from over 34% in 1990-91 to 18.5% at the end of 2006-07.
Source: TOI, June 1, 2007