MUMBAI: Lodha Developers, one of India’s biggest realtors, is taking a tall bet on Mumbai’s top-end residential property market as home continue to surge in the country’s financial capital. The company is negotiating with foreign as well as local financiers to fund what it claims would be the world’s tallest residential tower.
The Lodhas are learnt to have tapped leading Singapore funds GIC and Temasek, and a property fund of mortgage giant HDFC for over Rs 1,000 crore, said a banker.
According to sources in the Mumbai property market, the tower will come up on the 17.5-acre plot of the defunct Shrinivas Mill in Lower Parel, central Mumbai, that the Lodhas got control of after purchasing the shares of Shrinivas Cotton—which owned the land title— some years ago.
When contacted, Abhishek Lodha, managing director of Lodha Developers, confirmed that the company would build the world’s tallest tower in Mumbai, but refused to share further details. The Lodha group is scheduled to make an announcement on the project next week.
But the realty market has got a whiff of the project. “What we understand is that the tower may have 117 floors, and the company is talking to a famous name in the fashion world for the design... A project of this scale will take not less than three years to complete. It should have air evacuation facility and proper fire escape routes. As far as I know, the layout has been approved by state government authorities,” said a senior official of a leading property brokerage. “We don’t know when the booking will start, but the price should be around Rs 22,000 per sq ft,” he said.
The height of the world’s tallest residential tower—Queensland Number One in Australia—is 322.5 metres. While construction on some of the grand projects has been put on hold in the West following the market downturn, there’s some activity on in the Middle-East. Pentominium, the supertall skyscraper that’s under construction in Dubai, will be 516 metres with 120 floors.
The Lodhas are hiring the services of New York-based architect Pei Cobb Freed and Partners, which has completed nearly 200 architectural marvels across the globe, including Louvre Pyramid in Paris, Bank of China Tower in Hong Kong, and John Hancock Tower in Boston.
The group was recently in the news for having bagged a 22.5-acre property in Mumbai after bidding Rs 4,050 crore in the country’s biggest land deal
Success in my Habit
Friday, June 4, 2010
Wednesday, June 2, 2010
Etisalat says in India talks, Reliance Comm surges
ABU DHABI/MUMBAI (Reuters) - Abu Dhabi's Etisalat could decide within weeks whether to take a stake in an Indian telecoms operator, its chairman said on Wednesday, after a newspaper said it was in talks with Reliance Communications (RCOM.NS : 154.85 +16).
Shares in Reliance rose as much as 10 percent after the earlier newspaper report said Etisalat, which is the Gulf region's biggest provider of telecoms services by market capitalisation, was in advanced talks to buy a quarter of the Indian cellular operator for 180 billion rupees ($3.8 billion).
"We are talking to several Indian operators and are evaluating several Indian operators but have not reached a final decision," Mohammad Omran, chairman of Etisalat, also known as Emirates Telecommunications Corp, told Reuters.
Omran declined to comment specifically about the Reliance report and said that Etisalat had not taken any final decisions. "It may take a few weeks or it may take a few months," he said.
A day earlier another media report linked Reliance Communications to possible tie-up talks with South Africa's MTN.
A person close to the Indian firm who declined to be identified said both reports were speculation.
Reliance Communications is controlled by billionaire Anil Ambani, who recently ended an agreement not to compete in businesses with his long-estranged brother Mukesh, freeing him to bring outside investors into India's second biggest mobile operator.
That surprise announcement has prompted market speculation about the plans of both brothers now that their conglomerates are free to compete on each other's turf.
Two years ago Mukesh Ambani thwarted a planned tie-up between Reliance and South Africa's MTN by asserting a right of first refusal on the Indian carrier's shares.
If a deal is finalised Etisalat would make an open offer to acquire an additional 20 percent stake in Reliance Communications from the public, the Times of India said on Wednesday, citing market sources.
The equity capital of Reliance would expand by 25 percent if a deal is done and would reduce the stake of Anil Ambani to about 55 percent from 67.58 percent, the paper said.
A Reliance Communications official declined to comment.
CONSOLIDATION PRESSURE
India's cellphone market is fiercely competitive, with 15 operators locked in a price war that has destroyed margins and prompted talk of consolidation.
"We think the Indian market is ready for consolidation," Omran said.
A recent auction of third-generation network radio spectrum was far more costly than expected, with Reliance Communications forking out about $1.8 billion for its licences.
Indian carriers are expected to spend billions more dollars building 3G networks.
Reliance Communications shares gave up some of their early gains and traded at 142.30 rupees, up 6.3 percent, at mid-morning.
Etisalat already has a stake in an Indian mobile venture, Etisalat DB Telecom, which launched operations in March.
Indian rules prohibit a company from holding a more than 10 percent stake in two operators competing in the same telecom zone, which might force Etisalat either to sell its holding in the startup or merge it with Reliance Communications.
India's telecoms regulator in May recommended ending the restrictions on companies selling out, a move, once accepted by the government, would help paving the way for consolidation in the world's fastest growing mobile services market.
Shares in Reliance rose as much as 10 percent after the earlier newspaper report said Etisalat, which is the Gulf region's biggest provider of telecoms services by market capitalisation, was in advanced talks to buy a quarter of the Indian cellular operator for 180 billion rupees ($3.8 billion).
"We are talking to several Indian operators and are evaluating several Indian operators but have not reached a final decision," Mohammad Omran, chairman of Etisalat, also known as Emirates Telecommunications Corp, told Reuters.
Omran declined to comment specifically about the Reliance report and said that Etisalat had not taken any final decisions. "It may take a few weeks or it may take a few months," he said.
A day earlier another media report linked Reliance Communications to possible tie-up talks with South Africa's MTN.
A person close to the Indian firm who declined to be identified said both reports were speculation.
Reliance Communications is controlled by billionaire Anil Ambani, who recently ended an agreement not to compete in businesses with his long-estranged brother Mukesh, freeing him to bring outside investors into India's second biggest mobile operator.
That surprise announcement has prompted market speculation about the plans of both brothers now that their conglomerates are free to compete on each other's turf.
Two years ago Mukesh Ambani thwarted a planned tie-up between Reliance and South Africa's MTN by asserting a right of first refusal on the Indian carrier's shares.
If a deal is finalised Etisalat would make an open offer to acquire an additional 20 percent stake in Reliance Communications from the public, the Times of India said on Wednesday, citing market sources.
The equity capital of Reliance would expand by 25 percent if a deal is done and would reduce the stake of Anil Ambani to about 55 percent from 67.58 percent, the paper said.
A Reliance Communications official declined to comment.
CONSOLIDATION PRESSURE
India's cellphone market is fiercely competitive, with 15 operators locked in a price war that has destroyed margins and prompted talk of consolidation.
"We think the Indian market is ready for consolidation," Omran said.
A recent auction of third-generation network radio spectrum was far more costly than expected, with Reliance Communications forking out about $1.8 billion for its licences.
Indian carriers are expected to spend billions more dollars building 3G networks.
Reliance Communications shares gave up some of their early gains and traded at 142.30 rupees, up 6.3 percent, at mid-morning.
Etisalat already has a stake in an Indian mobile venture, Etisalat DB Telecom, which launched operations in March.
Indian rules prohibit a company from holding a more than 10 percent stake in two operators competing in the same telecom zone, which might force Etisalat either to sell its holding in the startup or merge it with Reliance Communications.
India's telecoms regulator in May recommended ending the restrictions on companies selling out, a move, once accepted by the government, would help paving the way for consolidation in the world's fastest growing mobile services market.
Monday, May 31, 2010
GDP growth at 7.4 per cent: FY10
New Delhi: According to the estimates by the Ministry of Statistics and Programme Implementation, the Indian economy has registered a growth of 7.4 per cent in 2009-10, with 8.6 per cent year-on-year (y-o-y) growth in its fourth quarter. The growth is driven by robust performance of the manufacturing sector on the back of government and consumer spending. GDP growth rate of 7.4 per cent in 2009-10 has exceeded the government forecast of 7.2 per cent for the full year.
According to government data, the manufacturing sector witnessed a growth of 16.3 per cent in January-March 2010, from a year earlier. The farm output rose at an annual rate of 0.7 per cent during the quarter on the back of a good winter harvest. The expansion in the March quarter was driven by government spending, manufacturing and services.
The government estimates the economy to grow at a rate of 8.5 per cent in 2010-11 driven by better farm output and a global recovery. The Finance Minister, Mr Pranab Mukherjee said that growth would exceed the government's estimate for the current fiscal. The farm sector, which constitutes nearly 17 per cent of the economy, is expected to perform well on the prediction of normal monsoon this year
According to government data, the manufacturing sector witnessed a growth of 16.3 per cent in January-March 2010, from a year earlier. The farm output rose at an annual rate of 0.7 per cent during the quarter on the back of a good winter harvest. The expansion in the March quarter was driven by government spending, manufacturing and services.
The government estimates the economy to grow at a rate of 8.5 per cent in 2010-11 driven by better farm output and a global recovery. The Finance Minister, Mr Pranab Mukherjee said that growth would exceed the government's estimate for the current fiscal. The farm sector, which constitutes nearly 17 per cent of the economy, is expected to perform well on the prediction of normal monsoon this year
Neeraj Patil elected Mayor of London Borough of Lambeth
New Delhi: Neeraj Patil, a leading NRI doctor, currently working as a consultant with A&E and a governor of Guys and St Thomas Hospital in central London, has been elected Mayor of the Borough of Lambeth.
Dr Patil, born and brought up in Kamalapur in Gulbarga district in Karnataka, completed his MBBS from M R Medical College, Gulbarga in 1992. He served in the Osmania Medical College for some time before he came to the UK for higher studies.
He has worked as an Accident and Emergency Consultant and a doctor for 14 years in over 25 National Health Services hospitals across UK.
Dr Patil, born and brought up in Kamalapur in Gulbarga district in Karnataka, completed his MBBS from M R Medical College, Gulbarga in 1992. He served in the Osmania Medical College for some time before he came to the UK for higher studies.
He has worked as an Accident and Emergency Consultant and a doctor for 14 years in over 25 National Health Services hospitals across UK.
Neeraj Patil elected Mayor of London Borough of Lambeth
New Delhi: Neeraj Patil, a leading NRI doctor, currently working as a consultant with A&E and a governor of Guys and St Thomas Hospital in central London, has been elected Mayor of the Borough of Lambeth.
Dr Patil, born and brought up in Kamalapur in Gulbarga district in Karnataka, completed his MBBS from M R Medical College, Gulbarga in 1992. He served in the Osmania Medical College for some time before he came to the UK for higher studies.
He has worked as an Accident and Emergency Consultant and a doctor for 14 years in over 25 National Health Services hospitals across UK.
Dr Patil, born and brought up in Kamalapur in Gulbarga district in Karnataka, completed his MBBS from M R Medical College, Gulbarga in 1992. He served in the Osmania Medical College for some time before he came to the UK for higher studies.
He has worked as an Accident and Emergency Consultant and a doctor for 14 years in over 25 National Health Services hospitals across UK.
Reinsurance
Reinsurance
Reinsurance is a contract between the insurance company (insurer) and a third party (re-insurer), wherein the latter will protect the former by paying losses sustained by it under the original contract of insurance.
Re-insurers from London, as well as other parts of Europe, see significant potential in the re-insurance market in India. Top four global re-insurers, Lloyds, Swiss Re, Munich Re and Berkshire Hathaway are amongst those eyeing India.
Bancasssurance
Private insurers have adopted bancassurance in a much bigger way than the state-owned Life Insurance Corporation (LIC) in the recent years. Bancassurance is distribution of insurance products through a bank's network.
In 2008-09, private insurers forked out US$ 44.4 million as commission for banassurance, while the payout by LIC for this distribution model was US$ 25,948.
Investment Policy
The FDI limit in the insurance space for foreign players is capped at 26 per cent—permissible under the automatic route subject to a licence from the official regulator, IRDA—but the government is planning to raise it to 49 per cent and a bill to give effect to the proposal is pending in the Rajya Sabha.
IRDA has stipulated that the mandatory ceding by every general insurer in the country to the national reinsurer – General Insurance Corporation (GIC), would continue to remain at 10 per cent as under current regulations.
IRDA has also allowed insurance companies to offer 'Health plus Life Combi Product', a policy that would provide life cover along with health insurance to subscribers.
Pension Fund Regulatory and Development Authority (PFRDA) would launch a low-cost pension scheme on April 1, 2010, to provide social security cover to economically weaker sections like rickshaw pullers, barbers and daily-wage labourers.
The Road Ahead
Saturation of insurance markets in many developed economies has made the Indian market more attractive for international insurance players, according to 'Booming Insurance Market in India (2008-2011)”. Further, according to the report,
Total life insurance premium in India is projected to grow US$ 266 billion by 2010-11
Total non-life insurance premium is expected to increase at a compound annual growth rate (CAGR) of 25 per cent for the period spanning from 2008-09 to 2010-11
The home insurance segment is set to achieve a 100 per cent growth as financial institutions have made home insurance obligatory for housing loan approvals
In the next three years, health insurance is poised to become the second largest business for non-life insurers after motor insurance
Reinsurance is a contract between the insurance company (insurer) and a third party (re-insurer), wherein the latter will protect the former by paying losses sustained by it under the original contract of insurance.
Re-insurers from London, as well as other parts of Europe, see significant potential in the re-insurance market in India. Top four global re-insurers, Lloyds, Swiss Re, Munich Re and Berkshire Hathaway are amongst those eyeing India.
Bancasssurance
Private insurers have adopted bancassurance in a much bigger way than the state-owned Life Insurance Corporation (LIC) in the recent years. Bancassurance is distribution of insurance products through a bank's network.
In 2008-09, private insurers forked out US$ 44.4 million as commission for banassurance, while the payout by LIC for this distribution model was US$ 25,948.
Investment Policy
The FDI limit in the insurance space for foreign players is capped at 26 per cent—permissible under the automatic route subject to a licence from the official regulator, IRDA—but the government is planning to raise it to 49 per cent and a bill to give effect to the proposal is pending in the Rajya Sabha.
IRDA has stipulated that the mandatory ceding by every general insurer in the country to the national reinsurer – General Insurance Corporation (GIC), would continue to remain at 10 per cent as under current regulations.
IRDA has also allowed insurance companies to offer 'Health plus Life Combi Product', a policy that would provide life cover along with health insurance to subscribers.
Pension Fund Regulatory and Development Authority (PFRDA) would launch a low-cost pension scheme on April 1, 2010, to provide social security cover to economically weaker sections like rickshaw pullers, barbers and daily-wage labourers.
The Road Ahead
Saturation of insurance markets in many developed economies has made the Indian market more attractive for international insurance players, according to 'Booming Insurance Market in India (2008-2011)”. Further, according to the report,
Total life insurance premium in India is projected to grow US$ 266 billion by 2010-11
Total non-life insurance premium is expected to increase at a compound annual growth rate (CAGR) of 25 per cent for the period spanning from 2008-09 to 2010-11
The home insurance segment is set to achieve a 100 per cent growth as financial institutions have made home insurance obligatory for housing loan approvals
In the next three years, health insurance is poised to become the second largest business for non-life insurers after motor insurance
Health Insurance
Health Insurance
The health insurance market stood at around US$ 1.5 billion in 2008-09 and is expected to grow to US$ 9 billion by 2016-17. While health insurance policies are mostly provided by general insurance companies, life insurers contribute about five per cent to the overall health insurance business.
Apollo DKV Health Insurance has renamed itself Apollo Munich Health Insurance as a part of its five-year strategic plan to gain a five per cent market share. Apollo Munich is a joint venture between Asia’s largest integrated healthcare provider, The Apollo Hospitals Group, and Germany-based Munich Re's segment, Munich Health.
Max India is planning to invest US$ 43.25 million in its health insurance joint venture (Max Bupa) and will launch a product over the January–June 2010 period.
Star Health and Allied Insurance expects to invest US$ 38.9 million during the current financial year to grow its health insurance business, taking the total invested capital to US$ 67 million.
US-based health insurer CIGNA is looking at entering the Indian market.
The health insurance market stood at around US$ 1.5 billion in 2008-09 and is expected to grow to US$ 9 billion by 2016-17. While health insurance policies are mostly provided by general insurance companies, life insurers contribute about five per cent to the overall health insurance business.
Apollo DKV Health Insurance has renamed itself Apollo Munich Health Insurance as a part of its five-year strategic plan to gain a five per cent market share. Apollo Munich is a joint venture between Asia’s largest integrated healthcare provider, The Apollo Hospitals Group, and Germany-based Munich Re's segment, Munich Health.
Max India is planning to invest US$ 43.25 million in its health insurance joint venture (Max Bupa) and will launch a product over the January–June 2010 period.
Star Health and Allied Insurance expects to invest US$ 38.9 million during the current financial year to grow its health insurance business, taking the total invested capital to US$ 67 million.
US-based health insurer CIGNA is looking at entering the Indian market.
Project Insurance
Project Insurance
Insurance companies are also witnessing increasing demand for project insurance in the last few months. Corporates are beginning to demand project insurance across sectors such as power generation with the cover beginning right from the start of the project till it is declared ready for commercial use. Some of the big projects also take cover for financial loss arising out of delay in completion.
Industry players estimate that premiums collected from project insurance will be around US$ 216.2 million for the industry as a whole and is expected to increase significantly.
Oriental Insurance Company Ltd will be offering comprehensive project insurance for the Tata Power Project at Mundra in Gujarat.
Insurance companies are also witnessing increasing demand for project insurance in the last few months. Corporates are beginning to demand project insurance across sectors such as power generation with the cover beginning right from the start of the project till it is declared ready for commercial use. Some of the big projects also take cover for financial loss arising out of delay in completion.
Industry players estimate that premiums collected from project insurance will be around US$ 216.2 million for the industry as a whole and is expected to increase significantly.
Oriental Insurance Company Ltd will be offering comprehensive project insurance for the Tata Power Project at Mundra in Gujarat.
General Insurance
General Insurance
The total number of general insurers registered with IRDA has gone up to 22, with the registration of SBI General Insurance Company Limited, a joint venture general insurance company promoted by State Bank of India and Insurance Australia Group, Australia, as a general insurer in December 2009. Moreover, L&T General Insurance is readying to launch its operations in the next three to five months.
The Gross Premium underwritten by public sector non-life insurers for the April-December 2009 period posted year-on-year growth of 11.37 per cent as compared to the year-on-year growth of 7.93 per cent posted by private sector non-life insurers. Overall, the non-life insurance sector grew 9.95 per cent in April-December 2009, compared to the corresponding period last year. According to IRDA data, out of the US$ 5.46 billion premium underwritten by the industry during the April-December 2009 period, US$ 3.24 billion came from the four public sector companies as compared to US$ 2.91 billion during the same period in 2008.
Moreover, in the 2010-11 budget, Finance Minister, Mr Pranab Mukherjee, has decided to roll back the government’s decision to tax the unrealised gains of non-life insurance companies. “The appreciation in the value of investments, being in the nature of unrealized gain is not taken into account for determining profit or loss of non-life insurance business as per the IRDA regulations. It is, therefore, proposed that the unrealized gains due to appreciation in the value of investments will not be included in the total income,” according to the budget documents.
According to data from the IRDA (Summary Reports of Motor Data of Public and Private Sector Insurers - 2008-09), in 2008-09, nearly 30 million vehicles were registered and a total premium worth US$ 2.03 billion was collected.
The total number of general insurers registered with IRDA has gone up to 22, with the registration of SBI General Insurance Company Limited, a joint venture general insurance company promoted by State Bank of India and Insurance Australia Group, Australia, as a general insurer in December 2009. Moreover, L&T General Insurance is readying to launch its operations in the next three to five months.
The Gross Premium underwritten by public sector non-life insurers for the April-December 2009 period posted year-on-year growth of 11.37 per cent as compared to the year-on-year growth of 7.93 per cent posted by private sector non-life insurers. Overall, the non-life insurance sector grew 9.95 per cent in April-December 2009, compared to the corresponding period last year. According to IRDA data, out of the US$ 5.46 billion premium underwritten by the industry during the April-December 2009 period, US$ 3.24 billion came from the four public sector companies as compared to US$ 2.91 billion during the same period in 2008.
Moreover, in the 2010-11 budget, Finance Minister, Mr Pranab Mukherjee, has decided to roll back the government’s decision to tax the unrealised gains of non-life insurance companies. “The appreciation in the value of investments, being in the nature of unrealized gain is not taken into account for determining profit or loss of non-life insurance business as per the IRDA regulations. It is, therefore, proposed that the unrealized gains due to appreciation in the value of investments will not be included in the total income,” according to the budget documents.
According to data from the IRDA (Summary Reports of Motor Data of Public and Private Sector Insurers - 2008-09), in 2008-09, nearly 30 million vehicles were registered and a total premium worth US$ 2.03 billion was collected.
Life Insurance
Life Insurance - FEB 2010
The US$ 41-billion Indian life insurance industry is considered the fifth largest life insurance market, and growing at a rapid pace of 32-34 per cent annually, according to the Life Insurance Council. Since the opening up of the insurance sector in India, the industry has received FDI to the tune of US$ 525.6 million. The government is likely to reintroduce the Insurance Bill which proposes to increase the FDI cap in private sector insurance companies from 26 per cent to 49 per cent.
The total number of life insurers registered with the Insurance Regulatory Development Authority (IRDA) has gone up to 23, with registration of the India First Life Insurance Company Limited, a joint venture life insurance company promoted by Bank of Baroda and Andhra Bank, India and Legal & General Middle East Limited, UK. The Life Insurance Corporation (LIC) posted a 50 per cent growth in new premium collection in the first nine months of the 2010 fiscal, increasing its market share to 65 per cent from 56 per cent a year ago.
LIC’s new premium collection touched US$ 9.58 billion in the April-December 2009 period while the combined business of the 22 private insurers grew to US$ 5.07 billion from the previous year, as per data collated by the Insurance Regulatory and Development Authority (IRDA). Overall the industry grew at 29 per cent in the April-December period of the fiscal year 2010.
The life insurance industry had earlier been expected to grow by 15 per cent in the 2010 fiscal year and cross the US$ 54.1 billion mark in total premium income by the end of March 2010, according to industry body, Life Insurance Council.
However, industry experts now believe that India's life insurance industry is likely to grow by around 10 per cent in 2010 over the previous year, mainly due to increased efficiency but also due to expansion in small towns and villages.
In order to support the aggressive growth in premium income in the current financial year, Future Generali India Life Insurance (a joint venture between the Future Group and the Italy-based Generali Group) has proposed to infuse an additional equity of US$ 32.55 million before the end of March 2010.
The US$ 41-billion Indian life insurance industry is considered the fifth largest life insurance market, and growing at a rapid pace of 32-34 per cent annually, according to the Life Insurance Council. Since the opening up of the insurance sector in India, the industry has received FDI to the tune of US$ 525.6 million. The government is likely to reintroduce the Insurance Bill which proposes to increase the FDI cap in private sector insurance companies from 26 per cent to 49 per cent.
The total number of life insurers registered with the Insurance Regulatory Development Authority (IRDA) has gone up to 23, with registration of the India First Life Insurance Company Limited, a joint venture life insurance company promoted by Bank of Baroda and Andhra Bank, India and Legal & General Middle East Limited, UK. The Life Insurance Corporation (LIC) posted a 50 per cent growth in new premium collection in the first nine months of the 2010 fiscal, increasing its market share to 65 per cent from 56 per cent a year ago.
LIC’s new premium collection touched US$ 9.58 billion in the April-December 2009 period while the combined business of the 22 private insurers grew to US$ 5.07 billion from the previous year, as per data collated by the Insurance Regulatory and Development Authority (IRDA). Overall the industry grew at 29 per cent in the April-December period of the fiscal year 2010.
The life insurance industry had earlier been expected to grow by 15 per cent in the 2010 fiscal year and cross the US$ 54.1 billion mark in total premium income by the end of March 2010, according to industry body, Life Insurance Council.
However, industry experts now believe that India's life insurance industry is likely to grow by around 10 per cent in 2010 over the previous year, mainly due to increased efficiency but also due to expansion in small towns and villages.
In order to support the aggressive growth in premium income in the current financial year, Future Generali India Life Insurance (a joint venture between the Future Group and the Italy-based Generali Group) has proposed to infuse an additional equity of US$ 32.55 million before the end of March 2010.
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