Hitachi Ltd plans to sign a joint venture agreement with an Indian firm early next year to assemble rail cars, Japanese business daily Nikkei reported.
The conglomerate plans to export India-made rail cars to Southeast Asian nations, such as Thailand and Vietnam, where it now sells cars made at its Yamaguchi plant, the newspaper said.
To bank on opportunities in India, which is aggressively investing in railway infrastructure, Hitachi wants to wrap up partnership talks early next year and start building a factory as soon as possible, Nikkei said.
The company will also set up a manufacturing base in the UK and plans to build a joint venture factory in Brazil, the business daily reported.
Hitachi expects to boost railway-related sales to 320 billion yen in 2015 from 133.1 billion yen in 2010, with 60 percent of that sales coming from overseas over this period, Nikkei said.
Success in my Habit
Saturday, December 10, 2011
Bullet train between Hyderabad and Chennai in the offing
HYDERABAD: If Indian Railways has its way, commuting between Hyderabad and Chennai in a few years will be just a little over two hours and terribly cheaper as compared to a flight. Hinting at such a possibility, a senior railway ministry official said in New Delhi on Thursday that a Japanese consortium has bagged the contract for a pre-feasibility study for running a bullet train on the Hyderabad-Vijayawada-Chennai corridor.
If it works out, at a speed of 300 km per hour, the train will cover the 664 km distance between Hyderabad and Chennai in just little over two hours. South Central Railway (SCR) officials became jubilant over such a development, though they indicated that they are still awaiting the details of the project. "Besides reducing the travel time between the two cities by almost 12 hours, the bullet train will transform the economy of the region as well as greatly contribute to the economic growth of both Hyderabad and Chennai," SCR chief PRO K Sambasiva Rao told TOI.
Japan External Trade Organisation (Jetro) and Oriental Consultancy along with Parsons Brinkhoff India has bagged the contract to conduct the pre-feasibility study on the proposed route for running the high speed train, a senior Railway Ministry official said.
Japan's high speed trains Shinkansen operate at a speed of up to 300 km per hour and are known for their punctuality, comfort, safety and efficiency.The consortium will submit the report in seven months. The study is expected to cost the railways about Rs 3. 5 crore. There were 13 bidders for the high speed rail project.
In order to expedite the bullet train project, Railways is in the process of constituting the National High Speed Rail Authority on the lines of the National Highways Authority.
According to an estimate, it will cost about Rs 100 crore to construct a one-km dedicated high speed corridor. As per the preliminary report, ridership revenues would be able to cover the operating cost of the project. State governments and financial institutions are expected to be stakeholders of the high speed rail corridor project as these projects will be executed through PPP mode.
If it works out, at a speed of 300 km per hour, the train will cover the 664 km distance between Hyderabad and Chennai in just little over two hours. South Central Railway (SCR) officials became jubilant over such a development, though they indicated that they are still awaiting the details of the project. "Besides reducing the travel time between the two cities by almost 12 hours, the bullet train will transform the economy of the region as well as greatly contribute to the economic growth of both Hyderabad and Chennai," SCR chief PRO K Sambasiva Rao told TOI.
Japan External Trade Organisation (Jetro) and Oriental Consultancy along with Parsons Brinkhoff India has bagged the contract to conduct the pre-feasibility study on the proposed route for running the high speed train, a senior Railway Ministry official said.
Japan's high speed trains Shinkansen operate at a speed of up to 300 km per hour and are known for their punctuality, comfort, safety and efficiency.The consortium will submit the report in seven months. The study is expected to cost the railways about Rs 3. 5 crore. There were 13 bidders for the high speed rail project.
In order to expedite the bullet train project, Railways is in the process of constituting the National High Speed Rail Authority on the lines of the National Highways Authority.
According to an estimate, it will cost about Rs 100 crore to construct a one-km dedicated high speed corridor. As per the preliminary report, ridership revenues would be able to cover the operating cost of the project. State governments and financial institutions are expected to be stakeholders of the high speed rail corridor project as these projects will be executed through PPP mode.
Global financial assets, including India's, to be worth $317 trillion by 2020: McKinsey
EW DELHI: The value of financial assets worldwide is expected to touch $ 371 trillion by 2020, with emerging economies including India, accounting for about one third of the total amount, says global consultancy McKinsey.
The projected worth of financial assets in 2020 would be nearly double the value of around $ 198 trillion witnessed last year.
These projections are part of a report prepared by the McKinsey Global Institute (MGI), the business and economics research arm of McKinsey & Company.
In 2010, emerging economies made up for 21 per cent of the global financial assets worth $ 198 trillion.
"Depending on economic scenarios, we project that emerging market financial assets will grow to between 30 and 36 per cent of the global total in 2020, or $ 114 to $ 141 trillion.. China's financial assets could be as much as $ 65 trillion by then, and India's could reach $ 8.6 trillion," the report said.
As per MGI, financial assets are equities, bonds, other fixed-income securities, cash, bank deposits and alternative assets. The value of real estate, derivatives, physical assets such as gold and equity in unlisted companies are excluded.
The report noted that emerging market financial assets grew 16.6 per cent annually over the past decade -- about four times the rate in mature economies.
"These assets stood at about $ 41 trillion in 2010 and constituted 21 per cent of the global total, up from 7 per cent in 2000," it added.
In terms of allocation, investors might put in just 22 per cent of their financial assets in equities by 2020 as compared to 28 per cent in 2010.
"The rise of wealth in emerging nations is the largest factor in this shift, followed by ageing populations and growth of alternative investments," the report pointed out.
Regarding India, MGI said that households are the largest investor class -- holding 42 per cent or accounting for $ 835 billion of the country's financial assets worth $ 2 trillion.
Noting that Indian household investors prefer gold and real estate to financial assets, the report said the government holds more than a quarter of all financial assets.
"This $ 560 billion portfolio is largely invested in bonds and the listed equity of corporations. Banks are also investors, with $ 280 billion in securities...," it said.
The projected worth of financial assets in 2020 would be nearly double the value of around $ 198 trillion witnessed last year.
These projections are part of a report prepared by the McKinsey Global Institute (MGI), the business and economics research arm of McKinsey & Company.
In 2010, emerging economies made up for 21 per cent of the global financial assets worth $ 198 trillion.
"Depending on economic scenarios, we project that emerging market financial assets will grow to between 30 and 36 per cent of the global total in 2020, or $ 114 to $ 141 trillion.. China's financial assets could be as much as $ 65 trillion by then, and India's could reach $ 8.6 trillion," the report said.
As per MGI, financial assets are equities, bonds, other fixed-income securities, cash, bank deposits and alternative assets. The value of real estate, derivatives, physical assets such as gold and equity in unlisted companies are excluded.
The report noted that emerging market financial assets grew 16.6 per cent annually over the past decade -- about four times the rate in mature economies.
"These assets stood at about $ 41 trillion in 2010 and constituted 21 per cent of the global total, up from 7 per cent in 2000," it added.
In terms of allocation, investors might put in just 22 per cent of their financial assets in equities by 2020 as compared to 28 per cent in 2010.
"The rise of wealth in emerging nations is the largest factor in this shift, followed by ageing populations and growth of alternative investments," the report pointed out.
Regarding India, MGI said that households are the largest investor class -- holding 42 per cent or accounting for $ 835 billion of the country's financial assets worth $ 2 trillion.
Noting that Indian household investors prefer gold and real estate to financial assets, the report said the government holds more than a quarter of all financial assets.
"This $ 560 billion portfolio is largely invested in bonds and the listed equity of corporations. Banks are also investors, with $ 280 billion in securities...," it said.
75mn households in India are ecommerce ready but less than 10mn actually transact
According to a study released by Internet and Mobile Association of India (IAMAI) and Intelink Advisors, there are around 75 million households (150 million people) in India, who are ready for ecommerce transactions today but, less than 10 million are engaged in active ecommerce. Citing the key reasons for this mismatch between potential and actual ecommerce consumers, the study states holds lack of trust, fulfilment issues, shopping experience as major impediments.The study adopted criteria of income, education and occupation to arrive at the number of household capable of ecommerce.
According to IAMAI, the current size of ecommerce market in India is about US$ 10bn and the size of ecommerce in India by 2024-2025 can reach between US$ 70 billion – US$ 150 billion and the potential is between US$ 125 billion – US$ 260 billion. The ‘Core’ potential of for consumer ecommerce is likely to increase to around 230 million households or 460 million individuals by 2024-2025, as the ‘Low SEC’ is set to increase at lower rate with about around 174 million individuals capable of ecommerce.
According to IAMAI, the current size of ecommerce market in India is about US$ 10bn and the size of ecommerce in India by 2024-2025 can reach between US$ 70 billion – US$ 150 billion and the potential is between US$ 125 billion – US$ 260 billion. The ‘Core’ potential of for consumer ecommerce is likely to increase to around 230 million households or 460 million individuals by 2024-2025, as the ‘Low SEC’ is set to increase at lower rate with about around 174 million individuals capable of ecommerce.
IBM to buy DemandTec for $440 million
ARMONK, New York: IBM says it is buying DemandTec, a price-management software company, for $440 million in cash to expand its commerce service offerings.
International Business Machines Corp. said Thursday that it is paying $13.20 per share for San Mateo, California-based DemandTec Inc. That's a 57 percent premium to DemandTec's closing stock price of $8.43 on Wednesday.
International Business Machines Corp. said Thursday that it is paying $13.20 per share for San Mateo, California-based DemandTec Inc. That's a 57 percent premium to DemandTec's closing stock price of $8.43 on Wednesday.
Facebook IPO sparks dreams of riches, adventure
Travelling to space or embarking on an expedition to excavate lost Mayan ruins are normally the stuff of adventure novels.
But for employees of Facebook, these and other lavish dreams are moving closer to reality as the world's No. 1 online social network prepares for a blockbuster initial public offering that could create at least a thousand millionaires.
The most anticipated stock market debut of 2012 is expected to value Facebook at as much as $100 billion, which would top just about any of Silicon Valley's most celebrated coming-out parties, from Netscape to Google Inc.
But for employees of Facebook, these and other lavish dreams are moving closer to reality as the world's No. 1 online social network prepares for a blockbuster initial public offering that could create at least a thousand millionaires.
The most anticipated stock market debut of 2012 is expected to value Facebook at as much as $100 billion, which would top just about any of Silicon Valley's most celebrated coming-out parties, from Netscape to Google Inc.
Alibaba seeks $4 billion financing to buy stake held by Yahoo, say sources
Alibaba Group is seeking up to $4 billion in debt financing, sources familiar with the matter said on Thursday, in a deal expected to help the Chinese e-commerce giant buy back a 40 percent stake in the company owned by Yahoo Inc.
Sources close to the situation said Rothschild, which is acting as debt adviser to Alibaba, had sent out term sheets to banks requesting underwritten proposals for the debt financing. The tenor of the debt expected to be up to three years. Reuters was unable to obtain a copy of the term sheets.
Alibaba Group, founded by entrepreneur and former English teacher Jack Ma, declined to comment. Alibaba, as a parent company, holds a 73.12 percent stake in Hong Kong listed Alibaba.com Ltd.
A Rothschild representative was not immediately available for comment.
Sources close to the situation said Rothschild, which is acting as debt adviser to Alibaba, had sent out term sheets to banks requesting underwritten proposals for the debt financing. The tenor of the debt expected to be up to three years. Reuters was unable to obtain a copy of the term sheets.
Alibaba Group, founded by entrepreneur and former English teacher Jack Ma, declined to comment. Alibaba, as a parent company, holds a 73.12 percent stake in Hong Kong listed Alibaba.com Ltd.
A Rothschild representative was not immediately available for comment.
Green energy to be made mandatory for powering cell towers
New Delhi: The Department of Telecom will make it mandatory for mobile companies to tap into renewable sources of energy for powering their towers.
Under the new rules, at least 50 per cent of towers and 20 per cent of the urban towers are to be powered by hybrid energy sources (renewable +grid) by 2015.
This will have to be scaled up to 75 per cent of rural towers and 33 per cent in urban areas by 2020.
The move is aimed at reducing the carbon emissions due to increased dependence on diesel. India has around 3.5 lakh telecom towers of which about 70 per cent are in rural areas. At present, 40 per cent power requirements are met by grid electricity and 60 per cent by diesel generators.
The diesel generators are of 10-15 KVA capacity and consume about 2 litres of diesel an hour and produce 2.63 kg of CO2 a litre, according to the Telecom Regulatory Authority of India. The total consumption is 2 billion litres of diesel and 5.3 million litres of CO2 is produced. For every KWH of grid electricity consumed, 0.84 kg of CO2 is emitted. Total CO2 emission is around 5 million tonnes of CO2 due to diesel consumption and around 8 million tonnes due to power grid per annum. To provide incentive to the tower companies, DoT sources said that there will be support from the Universal Services Obligation fund to meet the initial cost.
According to the telecom regulator, India's current renewable energy base is 18,455 MW (11 per cent of total installed base). Market analysts said that the Government should evolve a system whereby tower companies can directly withdraw power from Renewable Energy Service Companies (RESCOs) instead of the grid. “This is a win-win proposal because the RESCOs are assured of steady revenues and for the tower companies, it means lower dependence on diesel,” said the analyst.
Under the new rules, at least 50 per cent of towers and 20 per cent of the urban towers are to be powered by hybrid energy sources (renewable +grid) by 2015.
This will have to be scaled up to 75 per cent of rural towers and 33 per cent in urban areas by 2020.
The move is aimed at reducing the carbon emissions due to increased dependence on diesel. India has around 3.5 lakh telecom towers of which about 70 per cent are in rural areas. At present, 40 per cent power requirements are met by grid electricity and 60 per cent by diesel generators.
The diesel generators are of 10-15 KVA capacity and consume about 2 litres of diesel an hour and produce 2.63 kg of CO2 a litre, according to the Telecom Regulatory Authority of India. The total consumption is 2 billion litres of diesel and 5.3 million litres of CO2 is produced. For every KWH of grid electricity consumed, 0.84 kg of CO2 is emitted. Total CO2 emission is around 5 million tonnes of CO2 due to diesel consumption and around 8 million tonnes due to power grid per annum. To provide incentive to the tower companies, DoT sources said that there will be support from the Universal Services Obligation fund to meet the initial cost.
According to the telecom regulator, India's current renewable energy base is 18,455 MW (11 per cent of total installed base). Market analysts said that the Government should evolve a system whereby tower companies can directly withdraw power from Renewable Energy Service Companies (RESCOs) instead of the grid. “This is a win-win proposal because the RESCOs are assured of steady revenues and for the tower companies, it means lower dependence on diesel,” said the analyst.
Media, entertainment revenue to hit $25b by 2015: Ernst & Young
Mumbai: The Indian Media and Entertainment (M&E) industry registered revenues of $16.3 billion in 2010 and is expected to be in excess of $25 billion in the next four years, according to an Ernst & Young report ‘Spotlight on India's Entertainment Economy.' Growing digitisation, media consumption and improving demographics are leading drivers for industry growth.
Enticed by economic liberalisation, near double-digit annual growth, fast-growing middle class and a huge volume of demand for leisure and entertainment, global media companies have stepped up investment in India. . The Indian media and entertainment industry now finds itself at a new turning point — digital media. A surge in mass broadband adoption is expected, led by the launch of 3G and 4G services. By 2015, 90 per cent of India's projected 187 million broadband subscribers will access the net through wireless devices. This presents global M&E companies with exciting opportunities to develop “anytime, anywhere” content that caters to a new generation of Indian digital consumers, states the report.
“The M&E industry in India has been, and will continue to be, one of the biggest beneficiaries of India's favourable demographics,” said Mr Farokh Balsara, Ernst & Young's media and entertainment leader for Europe, West Asia , India and Africa. “Having one of the world's youngest populations, high volumes of content consumption, a favourable regulatory framework and growing digital adoption, makes India an attractive investment destination for global media and entertainment companies.”
Key findings in the report indicate that media and entertainment industry is lucrative for making investments. These are India's increasing per capita income, growing middle class and working population are generating huge domestic demand for leisure and entertainment. The country has more than 600 television channels, 100 million pay-television households, 70,000 newspapers and produces more than 1,000 films annually.
India has diverse regional markets with distinct cultures, languages and content preferences. These markets provide global media and entertainment companies with a variety of opportunities to deliver localised content. India's favourable regulations and reforms are creating investment opportunities for global media and entertainment companies.
Newspaper industry
The newspaper industry, which is facing declining readership in many international markets, continues to thrive in India, driven by increasing literacy rates, consumer spending and the growth of regional markets and specialty newspapers. Newspapers account for 42 per cent of all advertising spend in India — the most of any medium. The mandatory digitisation of India's television distribution infrastructure is driving growth of digital cable and DTH, creating a need for these companies to fund expansion. The third phase of radio licence auctions, expected soon, will see radio networks expanding their reach to add around 700 radio stations across the country.
“The growth strategies in most companies in the US and Western Europe are linked to India and other emerging markets,” said Mr John Nendick, Global Media and Entertainment Leader at Ernst & Young. “However, to succeed in India, global media and entertainment companies need to navigate unique challenges in the areas of content localisation, distribution and pricing, regulations and piracy.”
Enticed by economic liberalisation, near double-digit annual growth, fast-growing middle class and a huge volume of demand for leisure and entertainment, global media companies have stepped up investment in India. . The Indian media and entertainment industry now finds itself at a new turning point — digital media. A surge in mass broadband adoption is expected, led by the launch of 3G and 4G services. By 2015, 90 per cent of India's projected 187 million broadband subscribers will access the net through wireless devices. This presents global M&E companies with exciting opportunities to develop “anytime, anywhere” content that caters to a new generation of Indian digital consumers, states the report.
“The M&E industry in India has been, and will continue to be, one of the biggest beneficiaries of India's favourable demographics,” said Mr Farokh Balsara, Ernst & Young's media and entertainment leader for Europe, West Asia , India and Africa. “Having one of the world's youngest populations, high volumes of content consumption, a favourable regulatory framework and growing digital adoption, makes India an attractive investment destination for global media and entertainment companies.”
Key findings in the report indicate that media and entertainment industry is lucrative for making investments. These are India's increasing per capita income, growing middle class and working population are generating huge domestic demand for leisure and entertainment. The country has more than 600 television channels, 100 million pay-television households, 70,000 newspapers and produces more than 1,000 films annually.
India has diverse regional markets with distinct cultures, languages and content preferences. These markets provide global media and entertainment companies with a variety of opportunities to deliver localised content. India's favourable regulations and reforms are creating investment opportunities for global media and entertainment companies.
Newspaper industry
The newspaper industry, which is facing declining readership in many international markets, continues to thrive in India, driven by increasing literacy rates, consumer spending and the growth of regional markets and specialty newspapers. Newspapers account for 42 per cent of all advertising spend in India — the most of any medium. The mandatory digitisation of India's television distribution infrastructure is driving growth of digital cable and DTH, creating a need for these companies to fund expansion. The third phase of radio licence auctions, expected soon, will see radio networks expanding their reach to add around 700 radio stations across the country.
“The growth strategies in most companies in the US and Western Europe are linked to India and other emerging markets,” said Mr John Nendick, Global Media and Entertainment Leader at Ernst & Young. “However, to succeed in India, global media and entertainment companies need to navigate unique challenges in the areas of content localisation, distribution and pricing, regulations and piracy.”
Volkswagen to source more parts from India for global operations
Mumbai: German car major Volkswagen AG aims to source more parts from India for its global operations, and also hopes to triple its annual component sourcing out of India to over €300 million euros (Rs 2,074 crore) over the next 3-5 years.
The carmaker looks to double the number of component suppliers to over 200 to expand its range of spare parts made for global markets. This move, apart from helping Volkswagen source cost-effective components, will also help it increase its localisation to over 90% for its muchawaited small car UP!, which will be launched here in the next two-three years.
The higher localisation will help Volkswagen price its small car aggressively and take on market leaders Maruti Suzuki and Hyundai India.
Mahesh Kodumudi, executive director for components purchasing for Volkswagen group India, told ET: "We are still seeing India as a very competitive sourcing base – there's a cost advantage of at least 10-15% over Western Europe. And having worked with Indian vendors over the past few years, their capabilities too have matured and we do see them playing a bigger role."
Volkswagen plans to invest close to €250 million (Rs 1,728 crore) over the next few years on tooling and vendor development as newer models like UP! are being introduced in the market. The company has already invested a similar amount since its entry.
The German company today sources power train components, engine and transmission parts, metallic parts, sheet metal and a lot of small plastic parts. The company will be sourcing close to 50 million euros (Rs 432 crore) of plastic parts annually.
This is part of an overall plan to source close to €1 billion worth components from India, both for domestic and global operations. Volkswagen AG sources €70-80 billion worth of components annually from across the world. Increased localisation will also help the company derisk itself of currency fluctuations.
The carmaker looks to double the number of component suppliers to over 200 to expand its range of spare parts made for global markets. This move, apart from helping Volkswagen source cost-effective components, will also help it increase its localisation to over 90% for its muchawaited small car UP!, which will be launched here in the next two-three years.
The higher localisation will help Volkswagen price its small car aggressively and take on market leaders Maruti Suzuki and Hyundai India.
Mahesh Kodumudi, executive director for components purchasing for Volkswagen group India, told ET: "We are still seeing India as a very competitive sourcing base – there's a cost advantage of at least 10-15% over Western Europe. And having worked with Indian vendors over the past few years, their capabilities too have matured and we do see them playing a bigger role."
Volkswagen plans to invest close to €250 million (Rs 1,728 crore) over the next few years on tooling and vendor development as newer models like UP! are being introduced in the market. The company has already invested a similar amount since its entry.
The German company today sources power train components, engine and transmission parts, metallic parts, sheet metal and a lot of small plastic parts. The company will be sourcing close to 50 million euros (Rs 432 crore) of plastic parts annually.
This is part of an overall plan to source close to €1 billion worth components from India, both for domestic and global operations. Volkswagen AG sources €70-80 billion worth of components annually from across the world. Increased localisation will also help the company derisk itself of currency fluctuations.
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