NEW DELHI: Drug maker Lupin today said it has received tentative approval from US health regulator for its generic Metformin Hydrochloride extended-release tablets, used in the treatment of diabetes, in the American market.
The company's US arm Lupin Pharmaceuticals Inc has received approval from the US Food and Drug Administration for Metformin Hydrochloride extended-release tablets in the strengths of 500 mg and 1000 mg, Lupin said in a statement.
The company's product is generic equivalent of Andrx Labs LLC's Fortamet 500 mg and 1000 mg tablets and is indicated as an supplement to diet and exercise to improve glycemic control in adults with type 2 diabetes mellitus, it said.
Commenting on the approval, Lupin Pharmaceuticals CEO Vinita Gupta said: "This product approval demonstrates our commitment to enhance our generic pipeline, leveraging our development and manufacturing strengths in extended-release dosage forms."
The company believes it is the first applicant to file an abbreviated new drug application for Fortamet 500 mg and 1,000 mg and that could translate into 180 days of marketing exclusivity for its product.
"Upon receiving final approval by the FDA, Lupin believes that the 500 mg and 1,000 mg strengths of its product will be entitled to 180 days of marketing exclusivity," it said.
As per IMS Health data, annual sales for Fortamet in the US stood at USD 83 million for the 12 months ending December, 2010, it added.
Shares of Lupin were today trading at Rs 411.90 on the Bombay Stock Exchange in the late afternoon trade, up 0.99 per cent from its previous close.
Success in my Habit
Wednesday, April 20, 2011
Banking on the future with stem cells
PUNE: How do you improve your child's life quality when she turns 70 by investing Rs 1 lakh now? We are not talking insurance, but about creation of a stem cell bank when the child was young and accessed when she grows old.
Deepak Ghaisas -- former chief executive and finance head of i-flex -- is doing just that with his biotechnology firm Stemade. Stemade banks stem cells from your child's teeth when she is eight - or from the wisdom tooth when she is a little older - and allow it to be used even 50 years later.
A bean counter at heart, becoming a biotech entrepreneur is Ghaisas' third avatar, after starting off as a chartered accountant in a food firm and then moving to a very successful stint in technology services. His holding company is called Gencoval (generating companion value, in short) Strategic Services, which runs three subsidiaries: Stemade, Healthbridge, a business process re-engineering programme for hospitals and GCVLife, that is working on a technology that addresses diseases resulting from sleep apnoea.
He explains the stem cell foray in pure accounting terms: "This is the best kind of derivate product, where the downside is capped at Rs 1 lakh, while the upside is huge," Ghaisas said adding "we are addressing health and disease management using solutions based on stem cells and delivered through hospitals."
Ghaisas' logic for a biotech foray is that India is the market for such therapeutic products, unlike information technology.
"The market for IT remains the US, the Indian IT market is much smaller. However, when it comes to biotech and healthcare, the market is here, in India. The delivery is expensive now but that it should come down," he says. Stemade's products will eventually be delivered through hospitals while Healthbridge is working on improving process efficiencies.
Ghaisas, however, is not focusing on India alone: he plans to offer storage services for stem cells in India for customers in Singapore shortly and later for customers in Middle East too. "India can become the world's stem cell storage centre," he says.
The initial Rs 10-crore investment has been made by Ghaisas himself. And he might need venture capital or private equity of around Rs 40-45 crore when he sets up a research centre for which he is scouting for land in the Pune region.
In the four cities that Stemade has been launched, they have 300 registrations and 100 teeth banked. Ghaisas now plans to take the company to another six cities. "We charge Rs 10,000 at the time of registration and 50% of the total amount, Rs 45,000 at the time of the actual deposition of the teeth.
The balance, which is another Rs 45,000, is paid a month after the extraction, when the certification process is completed. We tell parents that if the child is 10-year-old, it would amount to paying Rs 1,000 a month till the child turns 21, although we take the money upfront. After 21, they pay Rs 6,000 annually" Ghaisas said.
There is another, bigger market that opens up with this, that of genomics. Around 10% stem cells have been found to match parents while the success rate in matching siblings is 30-40% but there is also an opportunity to generate matches for people around the world.
A database is being created under the genetic registry and while there are six types of genes, a match of even four of the six is alright with doctors. Ghaisas said he was looking at office space without divulging more.
For Stemade, the focus is on the autologous stem cell market, where a patient is treated using his/her own stem cells. This strategy is much in sync with the global focus on personalised medicine.
"There has been no blockbuster drug which is worth $1 billion, after Viagra. And there is a drying up of the pipeline for new molecule development in the pharma industry. Pharma companies are now eyeing biotechnology, just look at the acquisitions they are making," Ghaisas says explaining his new bet.
These autologous cells are multipotential stem cells which means that they can create tissue, unlike umbilical cord stem cells which are used to treat blood cell- related diseases. For storage purposes, the teeth are broken under a proprietary technology of French firm, Institute Clinident Biopharma, and stored at LifeCell's lab in Chennai for the next 40-50 years.
Deepak Ghaisas -- former chief executive and finance head of i-flex -- is doing just that with his biotechnology firm Stemade. Stemade banks stem cells from your child's teeth when she is eight - or from the wisdom tooth when she is a little older - and allow it to be used even 50 years later.
A bean counter at heart, becoming a biotech entrepreneur is Ghaisas' third avatar, after starting off as a chartered accountant in a food firm and then moving to a very successful stint in technology services. His holding company is called Gencoval (generating companion value, in short) Strategic Services, which runs three subsidiaries: Stemade, Healthbridge, a business process re-engineering programme for hospitals and GCVLife, that is working on a technology that addresses diseases resulting from sleep apnoea.
He explains the stem cell foray in pure accounting terms: "This is the best kind of derivate product, where the downside is capped at Rs 1 lakh, while the upside is huge," Ghaisas said adding "we are addressing health and disease management using solutions based on stem cells and delivered through hospitals."
Ghaisas' logic for a biotech foray is that India is the market for such therapeutic products, unlike information technology.
"The market for IT remains the US, the Indian IT market is much smaller. However, when it comes to biotech and healthcare, the market is here, in India. The delivery is expensive now but that it should come down," he says. Stemade's products will eventually be delivered through hospitals while Healthbridge is working on improving process efficiencies.
Ghaisas, however, is not focusing on India alone: he plans to offer storage services for stem cells in India for customers in Singapore shortly and later for customers in Middle East too. "India can become the world's stem cell storage centre," he says.
The initial Rs 10-crore investment has been made by Ghaisas himself. And he might need venture capital or private equity of around Rs 40-45 crore when he sets up a research centre for which he is scouting for land in the Pune region.
In the four cities that Stemade has been launched, they have 300 registrations and 100 teeth banked. Ghaisas now plans to take the company to another six cities. "We charge Rs 10,000 at the time of registration and 50% of the total amount, Rs 45,000 at the time of the actual deposition of the teeth.
The balance, which is another Rs 45,000, is paid a month after the extraction, when the certification process is completed. We tell parents that if the child is 10-year-old, it would amount to paying Rs 1,000 a month till the child turns 21, although we take the money upfront. After 21, they pay Rs 6,000 annually" Ghaisas said.
There is another, bigger market that opens up with this, that of genomics. Around 10% stem cells have been found to match parents while the success rate in matching siblings is 30-40% but there is also an opportunity to generate matches for people around the world.
A database is being created under the genetic registry and while there are six types of genes, a match of even four of the six is alright with doctors. Ghaisas said he was looking at office space without divulging more.
For Stemade, the focus is on the autologous stem cell market, where a patient is treated using his/her own stem cells. This strategy is much in sync with the global focus on personalised medicine.
"There has been no blockbuster drug which is worth $1 billion, after Viagra. And there is a drying up of the pipeline for new molecule development in the pharma industry. Pharma companies are now eyeing biotechnology, just look at the acquisitions they are making," Ghaisas says explaining his new bet.
These autologous cells are multipotential stem cells which means that they can create tissue, unlike umbilical cord stem cells which are used to treat blood cell- related diseases. For storage purposes, the teeth are broken under a proprietary technology of French firm, Institute Clinident Biopharma, and stored at LifeCell's lab in Chennai for the next 40-50 years.
Biocon's drug development partner Optimer receives US patent for Fidaxomicin
BANGALORE: Bangalore-based biotechnogy firm Biocon's drug development partner Optimer has received US patent for drug Fidaxomicin. The drug is used to treat diarrhea and intestinal diseases.
"We are the single source of supply of drug substance for Optimer which will certainly boost Biocon's sales this coming fiscal," Kiran Mazumdar-Shaw, CMD of Biocon, said. "I would say that the significant impact will be felt from Q1 FY12," she added.
Analysts expect the company to start the supply within a couple of months.
The closest competitor for Fidaxomicin is vancomycin - an antibiotec injectable manufactured and supplied by Strides Arcolabs . The market size is expected to be around $350 million but the margins for Biocon's drug could be bigger because Fidaxomicin is a novel product while vancomycin is a generic one, analysts said.
A generic drug is produced and distributed widely without patent protection and tends to be cheaper than the discovered product. It contains the same active ingredients as the original formulation. For example, paracetamol is the active ingredient of crocin. Paracetamol can therefore be the generic when sold without the brand name as well. The patent lease for Fidoxamicin is expected to last till March 2027.
Biocon shares rose 3% to end at 330 in a weak market.
"We are the single source of supply of drug substance for Optimer which will certainly boost Biocon's sales this coming fiscal," Kiran Mazumdar-Shaw, CMD of Biocon, said. "I would say that the significant impact will be felt from Q1 FY12," she added.
Analysts expect the company to start the supply within a couple of months.
The closest competitor for Fidaxomicin is vancomycin - an antibiotec injectable manufactured and supplied by Strides Arcolabs . The market size is expected to be around $350 million but the margins for Biocon's drug could be bigger because Fidaxomicin is a novel product while vancomycin is a generic one, analysts said.
A generic drug is produced and distributed widely without patent protection and tends to be cheaper than the discovered product. It contains the same active ingredients as the original formulation. For example, paracetamol is the active ingredient of crocin. Paracetamol can therefore be the generic when sold without the brand name as well. The patent lease for Fidoxamicin is expected to last till March 2027.
Biocon shares rose 3% to end at 330 in a weak market.
Gates Foundation to fund two cos for vaccine research
NEW DELHI: Bill and Melinda Gates Foundation will fund two Indian firms- Serum Institute of India and Bharat Biotech- to develop and sell vaccines for pneumonia and diarrhea that kills thousands of children every year, at less than half the current market price.
"The foundation will fund part of the cost for the clinical trials," Cyrus Poonawalla, chairman and MD of Serum Institute of India told ET. He did not say how much money the foundation will contribute but it costs about $10-20 million and $20-30 million to conduct clinical studies for pneumococcal and rotavirus vaccine, respectively. Both Serum Institute and Bharat Biotech are privately held local firms and will separately develop their vaccines.
Bill Gates, co-chair of the Bill and Melinda Gates Foundation and co-founder of IT giant Microsoft, said on Thursday in a media briefing, "We are giving grants to Bharat Biotech for a new rotavirus vaccine." According to estimates, nearly six lakh children die of rotavirus that causes diarrhea among infants each year globally.
The philanthropic organisation will fund as much as $30 million in the phase III trials for rotavirus vaccine that will allow firms like Serum to offer the vaccine 'at the best possible price'. Gates did not say how much of this money will be separately granted to the two Indian vaccine makers.
Krishna Ella, managing director of Bharat Biotech, said it has already started phase III trials of the rotavirus vaccine being developed from an indigenously discovered human strain. He declined to share details.
While both the local firms will work on developing cost rotavirus vaccines , Serum will also be involved in the vaccine for pneumonia.
Under the agreement with Serum, the country's largest vaccine maker will set up the manufacturing plant on its own and supply the two vaccines globally at an affordable price. The company plans to launch the drug in three years at less than half the prices of exiting brands marketed by American drugmaker Merck & Co and UK-based GlaxoSmithKline sell rotavirus vaccines. Some reports say existing drugs cost about $200-250 per dosage in North America.
"We will have a capacity of 80-100 million dosage for each vaccine," said Serum Institute's Poonawalla. The Pune-based firm has been supplying other vaccines for diseases such as menangitis besides pentavalent vaccines at just about one-fourth the price of its competitors, he said. The vaccines will be supplied to international procuring and supply agencies such as the UNICEF. These sourcing agencies can buy a larger number of such low cost vaccines with the same money and thus supply more dosages for underpriviledged children in other needy countries.
Bill Gates said India will be a source of lot of important innovations because it has great scientists and universities with understanding of the local needs. The Foundation plans to work with partners in India at basic research level, drug and vaccine development, manufacture of drugs and vaccines to leverage its low-cost capabilities.
"The foundation will fund part of the cost for the clinical trials," Cyrus Poonawalla, chairman and MD of Serum Institute of India told ET. He did not say how much money the foundation will contribute but it costs about $10-20 million and $20-30 million to conduct clinical studies for pneumococcal and rotavirus vaccine, respectively. Both Serum Institute and Bharat Biotech are privately held local firms and will separately develop their vaccines.
Bill Gates, co-chair of the Bill and Melinda Gates Foundation and co-founder of IT giant Microsoft, said on Thursday in a media briefing, "We are giving grants to Bharat Biotech for a new rotavirus vaccine." According to estimates, nearly six lakh children die of rotavirus that causes diarrhea among infants each year globally.
The philanthropic organisation will fund as much as $30 million in the phase III trials for rotavirus vaccine that will allow firms like Serum to offer the vaccine 'at the best possible price'. Gates did not say how much of this money will be separately granted to the two Indian vaccine makers.
Krishna Ella, managing director of Bharat Biotech, said it has already started phase III trials of the rotavirus vaccine being developed from an indigenously discovered human strain. He declined to share details.
While both the local firms will work on developing cost rotavirus vaccines , Serum will also be involved in the vaccine for pneumonia.
Under the agreement with Serum, the country's largest vaccine maker will set up the manufacturing plant on its own and supply the two vaccines globally at an affordable price. The company plans to launch the drug in three years at less than half the prices of exiting brands marketed by American drugmaker Merck & Co and UK-based GlaxoSmithKline sell rotavirus vaccines. Some reports say existing drugs cost about $200-250 per dosage in North America.
"We will have a capacity of 80-100 million dosage for each vaccine," said Serum Institute's Poonawalla. The Pune-based firm has been supplying other vaccines for diseases such as menangitis besides pentavalent vaccines at just about one-fourth the price of its competitors, he said. The vaccines will be supplied to international procuring and supply agencies such as the UNICEF. These sourcing agencies can buy a larger number of such low cost vaccines with the same money and thus supply more dosages for underpriviledged children in other needy countries.
Bill Gates said India will be a source of lot of important innovations because it has great scientists and universities with understanding of the local needs. The Foundation plans to work with partners in India at basic research level, drug and vaccine development, manufacture of drugs and vaccines to leverage its low-cost capabilities.
Tata Steel signs pact with Rio Tinto on HIsarna iron smelting
NEW DELHI: Tata Steel today said it has signed a licensing agreement with mining major Rio Tinto for commercial development of environment-friendly direct iron smelting process , called HIsarna.
"The agreement covers how both parties will work together, sharing their existing knowledge of the two technologies that are combined in the new process," it said in a statement.
The HIsarna iron-making process consists of cyclone pre-reduction technology (CCF), owned by Tata Steel, and bath smelting technology (HIsmelt), owned by Rio Tinto.
"This combination offers excellent opportunities for the collection and geological storage of carbon-di-oxide, ability to utilise lower-cost raw material feeds and the prospect of energy savings through the elimination of stages in the ironmaking process," the statement added.
The HIsarna technology has long-term potential to replace conventional blast furnaces, coke ovens and sinter plants and to reduce carbon-di-oxide emissions by more than 50 per cent if combined with Carbon Capture and Storage (CCS).
Funded jointly by the consortium of European steelmakers' ULCOS, the European Commission and the Dutch Economic Affairs Ministry, a HIsarna pilot plant is being commissioned at Tata Steel's IJmuiden steelworks in the Netherlands.
The six lakh tonne per annum plant is intended to allow the two constituent technologies to be tested in combination.
"The agreement covers how both parties will work together, sharing their existing knowledge of the two technologies that are combined in the new process," it said in a statement.
The HIsarna iron-making process consists of cyclone pre-reduction technology (CCF), owned by Tata Steel, and bath smelting technology (HIsmelt), owned by Rio Tinto.
"This combination offers excellent opportunities for the collection and geological storage of carbon-di-oxide, ability to utilise lower-cost raw material feeds and the prospect of energy savings through the elimination of stages in the ironmaking process," the statement added.
The HIsarna technology has long-term potential to replace conventional blast furnaces, coke ovens and sinter plants and to reduce carbon-di-oxide emissions by more than 50 per cent if combined with Carbon Capture and Storage (CCS).
Funded jointly by the consortium of European steelmakers' ULCOS, the European Commission and the Dutch Economic Affairs Ministry, a HIsarna pilot plant is being commissioned at Tata Steel's IJmuiden steelworks in the Netherlands.
The six lakh tonne per annum plant is intended to allow the two constituent technologies to be tested in combination.
L&T to seek shareholders' nod to demerge electrical business
NEW DELHI: Leading private infrastructure firm Larsen and Toubro today said it has sought shareholders' approval to transfer its electrical and automation business to a subsidiary.
"The Board of Directors of the company at its meeting held on April 6, 2011, has approved seeking of shareholders approval for transfer of the Electrical & Automation (E&A) Business to a subsidiary and / or associate company or to any other entity," the company said in a regulatory filing.
The filing added that the restructuring will be done as per the relevant sections and rules of the Companies Act, 1956.
The company in a separate notice to shareholders today said that the proposed restructuring would not include the medical equipment business.
In January, Larsen and Toubro group had announced that it would restructure its operations into nine independent entities, including the electrical and automation business.
According to media reports, the company is planning to sell this division and is in talks with Schneider Electric and Eaton Corporation. The reports also suggested that L&T is looking at valuation of Rs 12,000-14,000 crore for the electrical and automation business.
This could not be verified independently with Larsen. Bank of America Merrill Lynch recently valued Larsen's Electrical and Automation business at about Rs 8,900 crore.
Industry experts said that L&T is trying to sell its non-core businesses and wants to focus more on engineering and construction segment which accounted for more than 85 per cent of sales in 2009-10 at Rs 31,650 crore.
On the other hand, Electrical and Automation's (formerly Electrical and Electronics) gross sales were reported at Rs 3675 crore with profit before interest and tax (PBIT).
The proposed to be demerged business of the L&T, which employs approximately 5328 persons, has manufacturing facilities at Mumbai, Ahmednagar and at several locations abroad, while its portfolio covers a big range of electrical equipments, including low and medium-voltage switch-gears.
Following the announcement of the news, scrips of the company were up by 1.62 per cent today on the Bombay Stock Exchange, at Rs 1,706.80 apiece.
"The Board of Directors of the company at its meeting held on April 6, 2011, has approved seeking of shareholders approval for transfer of the Electrical & Automation (E&A) Business to a subsidiary and / or associate company or to any other entity," the company said in a regulatory filing.
The filing added that the restructuring will be done as per the relevant sections and rules of the Companies Act, 1956.
The company in a separate notice to shareholders today said that the proposed restructuring would not include the medical equipment business.
In January, Larsen and Toubro group had announced that it would restructure its operations into nine independent entities, including the electrical and automation business.
According to media reports, the company is planning to sell this division and is in talks with Schneider Electric and Eaton Corporation. The reports also suggested that L&T is looking at valuation of Rs 12,000-14,000 crore for the electrical and automation business.
This could not be verified independently with Larsen. Bank of America Merrill Lynch recently valued Larsen's Electrical and Automation business at about Rs 8,900 crore.
Industry experts said that L&T is trying to sell its non-core businesses and wants to focus more on engineering and construction segment which accounted for more than 85 per cent of sales in 2009-10 at Rs 31,650 crore.
On the other hand, Electrical and Automation's (formerly Electrical and Electronics) gross sales were reported at Rs 3675 crore with profit before interest and tax (PBIT).
The proposed to be demerged business of the L&T, which employs approximately 5328 persons, has manufacturing facilities at Mumbai, Ahmednagar and at several locations abroad, while its portfolio covers a big range of electrical equipments, including low and medium-voltage switch-gears.
Following the announcement of the news, scrips of the company were up by 1.62 per cent today on the Bombay Stock Exchange, at Rs 1,706.80 apiece.
L&T to hive off electrical & automation business
MUMBAI: Larsen & Toubro will hive off its electrical and automation business as a part of its restructuring, the company said on Tuesday.
According to analysts, the move is a step towards selling off the business. The sale has been widely anticipated for months, with Francebased Schneider Electric and NYSE-listed Eaton Corporation believed to be in the race to acquire the business. ET's business channel, ET Now, reported on Tuesday that L&T is close to sealing the deal with Eaton for around $1.5 billion (around Rs 6,682 crore).
Eaton Corp declined comment. "We do not comment on speculations or rumors. When we have any news, we will use the regular channel to communicate to the media," Eaton Corporation said in a response to ET's query. Earlier, Larsen & Toubro said in a note to its shareholders: "Considering the challenges of operating the electrical and automation business as a part of the business portfolio of a predominantly project and construction company, it is proposed to restructure the business by transferring it to a subsidiary company and/or an associate company or any other entity."
"This restructuring of business is required so that it is able to realise its full potential and participate comprehensively in the growth of the industry," the company said. Shares of L&T rose 1.6% to end at Rs 1,706.80 rupees on the Bombay Stock Exchange on Tuesday, reacting to the company's decision to spin off the business into a separate subsidiary.
"This in our view is part of L&T's move to exit businesses which are dilutive on returns, where it doesn't have clear leadership and re-allocate capital. L&T is set for. 613 billion of capex in infra development businesses, which needs. 184 billion (assuming 30%) as equity," Bharat Parekh, analyst, Bank of America-Merrill Lynch said in a report.
The proposed company would include L&T products and solutions in the electrical distribution and industry automation space. The division clocked sales of. 3,675 crore in 2009-10 (April-March ), with an operating profit of. 390 crore. It accounts for around 7% of the company's total turnover. After the retirement of the division's president RN Mukhija last year, the division has not had a representative on the board of the company. As a strategy, L&T has in the past sold its non-core businesses such as petrol pump vending machines and cement businesses.
It has also exited joint ventures such as L&TCASE Equipment Private and Voith Paper Technology India. "As a part of our strategy, we are continuously looking at our portfolio to determine what action we should take," JP Nayak, wholetime director and president (machinery & industrial products), told ET in a recent interview. "Our objective will be to have a portfolio in those areas where growth and profit potential is better, and try to get out of those areas where it may not be worthwhile for us to spend our valuable resources," he had said.
Deal Street
L&T wants to restructure biz by transfering it to a subsidiary or associate company Schneider Electric & Eaton are believed to be in the race to acquire the business In the past, L&T had sold its non-core businesses such as petrol pump vending machines and cement businesses.
According to analysts, the move is a step towards selling off the business. The sale has been widely anticipated for months, with Francebased Schneider Electric and NYSE-listed Eaton Corporation believed to be in the race to acquire the business. ET's business channel, ET Now, reported on Tuesday that L&T is close to sealing the deal with Eaton for around $1.5 billion (around Rs 6,682 crore).
Eaton Corp declined comment. "We do not comment on speculations or rumors. When we have any news, we will use the regular channel to communicate to the media," Eaton Corporation said in a response to ET's query. Earlier, Larsen & Toubro said in a note to its shareholders: "Considering the challenges of operating the electrical and automation business as a part of the business portfolio of a predominantly project and construction company, it is proposed to restructure the business by transferring it to a subsidiary company and/or an associate company or any other entity."
"This restructuring of business is required so that it is able to realise its full potential and participate comprehensively in the growth of the industry," the company said. Shares of L&T rose 1.6% to end at Rs 1,706.80 rupees on the Bombay Stock Exchange on Tuesday, reacting to the company's decision to spin off the business into a separate subsidiary.
"This in our view is part of L&T's move to exit businesses which are dilutive on returns, where it doesn't have clear leadership and re-allocate capital. L&T is set for. 613 billion of capex in infra development businesses, which needs. 184 billion (assuming 30%) as equity," Bharat Parekh, analyst, Bank of America-Merrill Lynch said in a report.
The proposed company would include L&T products and solutions in the electrical distribution and industry automation space. The division clocked sales of. 3,675 crore in 2009-10 (April-March ), with an operating profit of. 390 crore. It accounts for around 7% of the company's total turnover. After the retirement of the division's president RN Mukhija last year, the division has not had a representative on the board of the company. As a strategy, L&T has in the past sold its non-core businesses such as petrol pump vending machines and cement businesses.
It has also exited joint ventures such as L&TCASE Equipment Private and Voith Paper Technology India. "As a part of our strategy, we are continuously looking at our portfolio to determine what action we should take," JP Nayak, wholetime director and president (machinery & industrial products), told ET in a recent interview. "Our objective will be to have a portfolio in those areas where growth and profit potential is better, and try to get out of those areas where it may not be worthwhile for us to spend our valuable resources," he had said.
Deal Street
L&T wants to restructure biz by transfering it to a subsidiary or associate company Schneider Electric & Eaton are believed to be in the race to acquire the business In the past, L&T had sold its non-core businesses such as petrol pump vending machines and cement businesses.
LandT, Bhel to gain from new PGCIL norm
MUMBAI: Competition for high-voltage power sub-station projects is heating up after state-run Power Grid Corporation of India (PGCIL) altered the eligibility criteria for the bidding process for the segment.
Power Grid, which transmits 45% of the power generated in the country through its over 81,000 circuit-km transmission lines, has separated the circuit breaker and sub-station packages in tenders floated over the past few months. This has paved the way for newer players to join the bidding process.
So far, only leading multinational transmission and distribution companies -such as ABB , Siemens and Areva T&D , which together account for almost 70% of the high voltage 765 kV market in the country-were qualified for the 765 kV circuit breakers, and domestic engineering companies found it difficult to match the price if they procured circuit breakers from foreign vendors.
"PGCIL move to award tenders for sub-stations projects and circuit breakers separately gives new entrants such as Crompton Greaves, L&T and Bhel a chance to participate in this growing market," Lakshminarayana Ganti, research analyst at BNP Paribas Securities Asia , said in a report. High-voltage circuit breakers protect and control electrical power transmission networks.
Sub-stations are installations in the power grid that transform voltage levels and facilitate safe and efficient transmission and distribution of electricity. Power Grid plans to invest about. 55,000 crore during the 2007-12 Plan period to develop transmission systems. Infrastructure based on high voltage 765 kV would account for around 30% of the company's total transformation capacity target.
"International players had a cost advantage in the high voltage market, as they also manufacture some components. But it is a crucial and growing area in T&D space and we have worked towards pre-qualification to make ourselves eligible," KV Rangaswami, president (construction), Larsen & Toubro, said. Crompton Greaves, which acquired high voltage technology through overseas acquisitions, has come up as a strong player in the domestic transmission and distribution market.
"In India, the T&D equipment sector presents opportunities amounting to some $123 billion over the country's 11th and 12th Plan periods. Historically, Crompton Greaves has had a market share of 6-7 %. However, as it moves up the technology curve, and with its head-start over domestic competitors in the 765 kV space, Crompton Greaves could grow its share," Amar Kedia, analyst at Nomura Financial Advisory and Securities (India), said in a report recently.
Analysts say near-term order inflows may remain elusive as order revival from Power Grid is likely only in the second half of 2011, but the competition for these order would continue to increase.
Power Grid, which transmits 45% of the power generated in the country through its over 81,000 circuit-km transmission lines, has separated the circuit breaker and sub-station packages in tenders floated over the past few months. This has paved the way for newer players to join the bidding process.
So far, only leading multinational transmission and distribution companies -such as ABB , Siemens and Areva T&D , which together account for almost 70% of the high voltage 765 kV market in the country-were qualified for the 765 kV circuit breakers, and domestic engineering companies found it difficult to match the price if they procured circuit breakers from foreign vendors.
"PGCIL move to award tenders for sub-stations projects and circuit breakers separately gives new entrants such as Crompton Greaves, L&T and Bhel a chance to participate in this growing market," Lakshminarayana Ganti, research analyst at BNP Paribas Securities Asia , said in a report. High-voltage circuit breakers protect and control electrical power transmission networks.
Sub-stations are installations in the power grid that transform voltage levels and facilitate safe and efficient transmission and distribution of electricity. Power Grid plans to invest about. 55,000 crore during the 2007-12 Plan period to develop transmission systems. Infrastructure based on high voltage 765 kV would account for around 30% of the company's total transformation capacity target.
"International players had a cost advantage in the high voltage market, as they also manufacture some components. But it is a crucial and growing area in T&D space and we have worked towards pre-qualification to make ourselves eligible," KV Rangaswami, president (construction), Larsen & Toubro, said. Crompton Greaves, which acquired high voltage technology through overseas acquisitions, has come up as a strong player in the domestic transmission and distribution market.
"In India, the T&D equipment sector presents opportunities amounting to some $123 billion over the country's 11th and 12th Plan periods. Historically, Crompton Greaves has had a market share of 6-7 %. However, as it moves up the technology curve, and with its head-start over domestic competitors in the 765 kV space, Crompton Greaves could grow its share," Amar Kedia, analyst at Nomura Financial Advisory and Securities (India), said in a report recently.
Analysts say near-term order inflows may remain elusive as order revival from Power Grid is likely only in the second half of 2011, but the competition for these order would continue to increase.
GMR Infra eyes $150 mn private equity cash
BANGALORE: GMR Infrastructure Ltd , which develops airports and power projects, is looking to raise $150 million through private equity for its airport arm, its group chief financial officer said on Tuesday.
The company was in the process of securing final government approvals for the deal, which had already won clearance from the Foreign Investment Promotion Board, Subbarao Amarthaluru told Reuters in an interview, adding it would be difficult to set a timeline for the deal closure.
There would be no immediate equity dilution due to the investment as it would be in the form of compulsorily convertible structured product that will be convertible when the unit goes public, he added.
Last month, Bangalore-based GMR said Macquarie SBI Infrastructure Investments had invested $200 million in its unit, GMR Airports Holding Ltd, which runs the Delhi and Hyderabad airports.
With these private equity investments, Bangalore-based GMR's cash position is likely to touch $1 billion, he said.
Amarthaluru said an initial public offer for its energy unit, GMR Energy, was likely only by end of the current fiscal year to March 2012 or the beginning of the next fiscal year.
"There has to be conducive market conditions," he said. "And as of now we have money, also. There is no point in raising money much ahead of your requirements."
Last year, the company raised $300 million through a private equity sale in GMR Energy.
Earlier on Tuesday, GMR said it had completed the sale of its 50-percent stake in US-based utility InterGen NV to a consortium led by China Huaneng Group for $1.23 billion. The company said $1 billion of this would be used to cut debt.
The company bought the stake for $1.1 billion in 2008.
The company was in the process of securing final government approvals for the deal, which had already won clearance from the Foreign Investment Promotion Board, Subbarao Amarthaluru told Reuters in an interview, adding it would be difficult to set a timeline for the deal closure.
There would be no immediate equity dilution due to the investment as it would be in the form of compulsorily convertible structured product that will be convertible when the unit goes public, he added.
Last month, Bangalore-based GMR said Macquarie SBI Infrastructure Investments had invested $200 million in its unit, GMR Airports Holding Ltd, which runs the Delhi and Hyderabad airports.
With these private equity investments, Bangalore-based GMR's cash position is likely to touch $1 billion, he said.
Amarthaluru said an initial public offer for its energy unit, GMR Energy, was likely only by end of the current fiscal year to March 2012 or the beginning of the next fiscal year.
"There has to be conducive market conditions," he said. "And as of now we have money, also. There is no point in raising money much ahead of your requirements."
Last year, the company raised $300 million through a private equity sale in GMR Energy.
Earlier on Tuesday, GMR said it had completed the sale of its 50-percent stake in US-based utility InterGen NV to a consortium led by China Huaneng Group for $1.23 billion. The company said $1 billion of this would be used to cut debt.
The company bought the stake for $1.1 billion in 2008.
KEC International bags Rs 550-cr orders from India, Brazil
NEW DELHI: RPG Group company KEC International today said it has bagged orders worth Rs 550 crore from India and Brazil for the construction of transmission network.
"The company has secured a turnkey contract for construction of transmission lines from Maharashtra State Electricity Transmission Company Ltd (Mahatransco)," KEC International said in a statement.
Total order value is Rs 367 crore and the completion period is 18 months, the statement said.
SAE Towers, the wholly-owned subsidiary of KEC International has secured Rs 183 crore tower supply order in Brazil.
"We are seeing huge demand for transmission towers in American markets, KEC and SAE Towers have secured total Rs 1,350 crore tower supply orders post acquisition," Ramesh Chandak, MD and CEO, KEC International said.
Shares of KEC International were trading at Rs 88.80 in the afternoon trade on the Bombay Stock Exchange today, up 3.32 per cent from its previous close.
"The company has secured a turnkey contract for construction of transmission lines from Maharashtra State Electricity Transmission Company Ltd (Mahatransco)," KEC International said in a statement.
Total order value is Rs 367 crore and the completion period is 18 months, the statement said.
SAE Towers, the wholly-owned subsidiary of KEC International has secured Rs 183 crore tower supply order in Brazil.
"We are seeing huge demand for transmission towers in American markets, KEC and SAE Towers have secured total Rs 1,350 crore tower supply orders post acquisition," Ramesh Chandak, MD and CEO, KEC International said.
Shares of KEC International were trading at Rs 88.80 in the afternoon trade on the Bombay Stock Exchange today, up 3.32 per cent from its previous close.
Subscribe to:
Posts (Atom)