Steelcase opens manufacturing unit in India

Pune: Steelcase, a Michigan USA-based manufacturer of office furniture, has opened its first manufacturing facility in India. Located in Chakan, the new plant will employ approximately 100 people.

Steelcase sees the plant as a vital step in enhancing the services and logistics it provides to its growing Indian customer base.

Uli Gwinner, President, Steelcase Asia-Pacific, said: “We need to be where our customers are, so this is a critical long-term investment for Steelcase.”

Jeff Ge, Vice-President of Operations, Asia-Pacific, added that the new plant will produce a range of Steelcase products specifically for the Indian market.

“It signifies the importance that we place on servicing India, as part of our goal of strengthening Steelcase’s overall presence in Asia,” he added.

With the new plant, Steelcase aims to reduce delivery times and expand the range of products available to customers in India.

Honda's Rajasthan plant to roll out cars in 2014-15

Ahmedabad: Honda Cars India Ltd (HCIL) will roll out the first cars from its Rajasthan plant in the next financial year, 2014-15, a senior company official said on Tuesday.

HCIL will also launch five new models by 2015.

Honda’s plant at Tappugada, in Alwar district of Rajasthan, which has started making various components, will begin car production in the next financial year, said Shigeru Yamazaki, Senior Vice-President and Director, Marketing and Sales.

Rs 2,500-cr investment
HCIL has invested Rs 2,500 crore on this plant, spread over 450 acres. Its capacity will be 440 cars, or 120,000 units a year, the same as that of Honda’s other plant in Greater Noida, Yamazaki said.

The plant procures 80-90 per cent of its components from local vendors, and has begun exporting its products. Last year, it exported Honda Brio to South Africa.

He said Honda India, which sold 73,000 units last fiscal, expects to use the full capacity at its Greater Noida plant soon, given increased demand. In 2012-13, the company grew 35 per cent, a pace that it expects to sustain.

Yamazaki, who launched family sedan Honda Amaze here, said the company has introduced this diesel car for the first time in India.

Wider choice
So far, Honda has been selling diesel cars only in Europe. Amaze has been developed at the Honda R&D Asia Pacific Company Ltd, Bangkok (Thailand). India is the first country to launch Amaze with Honda’s latest i-DTEC diesel engine technology.

It has introduced the diesel variant to provide customers a wider choice. In India, 70 per cent of car market is for the diesel variant, which Honda did not have until it launched Amaze.

HCIL is increasing the number of its dealers from 150 to 162 across India this year to promote the sale of Amaze, whose typical buyers seem to be middle-income and middle-aged businessmen.

The company is now focusing on tier-2 and tier-3 towns and cities for prospective buyers.

Rs 1,000-cr desalination plant for Chennai

Chennai: A 150-million-litre-a-day desalination plant to convert sea water to drinking water is to come up adjacent to the Nemmeli desalination plant, announced the Chief Minister, J. Jayalalithaa in the Assembly today.

The additional capacity will come up at a cost of about Rs 1,000 crore on the 10.5-acre vacant plot next to the existing desalination plant which was formally inaugurated in February.

The plant, which is in operation, about 35 km South of Chennai on the East Coast Road, now supplies about 100 million litres of fresh water daily.

The additional capacity will supply drinking water to over 6.46 lakh residents in the suburbs to the south of Chennai which were added to the City Corporation limits.

A 200-million-litre-a-day desalination plant will also be established at Pattipulam to the south of Chennai with provision to expand to 400 million litres.

This unit will be set up within four years, she said.

The expanded portions of the city will also get over 225 km length of integrated roads at a cost of Rs 290 crore, 1.10 lakh energy efficient street lights at a cost of Rs 300 crore, and sewerage treatment plants at a cost of Rs 121 crore.

India's semiconductor consumption to grow over 20% this year: Gartner

Mumbai: In contrast with the global trend, India’s semiconductor consumption rose 7.4 per cent to touch $8 billion in 2012 from that a year ago.

Worldwide semiconductor revenues fell 2.6 per cent to touch $299.9 billion in 2012, according to a study by research and analysis firm Gartner.

“The worldwide semiconductor industry suffered serious disruption in 2012. Excess inventory in the supply chain was the key factor,” said Ganesh Ramamoorthy, research director at Gartner.

“High inventory levels impacted semiconductor consumption in India as well during 2012. However, a relatively better domestic economic climate and growth in consumer spending helped semiconductor consumption growth in India,” he added.

Of the three key electronic devices — mobile phones, PCs and LCD TVs, LCD TVssaw the biggest growth of nearly 45 per cent in terms of semiconductor consumption.

Demand for mobile phones grew 5.7 per cent and that of personal computers fell 0.3 per cent during 2012.

The three key electronic devices account for more than 70 per cent of India’s overall semiconductor consumption.

Consumption to rise
“With the global semiconductor industry poised for a rebound starting in the second quarter of 2013, we expect the semiconductor consumption in India to also grow. Semiconductor consumption in India will reach $9.6 billion in 2013, an increase of 20 per cent over 2012,” said Ramamoorthy.

“Mobile phones, PCs and LCD TVs will account for 74 per cent of India’s total semiconductor consumption in 2013,” he added.

India expected to export 7.5 MT of wheat by June 2013

New Delhi: Wheat exports from India is expected to touch a record high of 7.5 million tonnes (MT) in the current marketing year ending June 2013, on the back of record crop and larger carry over stocks, while many other exporting nations are expected to face tight supplies, according to a report by Food and Agriculture Organisation (FAO).

Shipments from India remained lower in marketing year 2011-12, as wheat export was allowed via private trade only after lifting the ban on the same in September 2011, as per the market experts.

To reduce stocks built up due to record harvest, India is promoting export of government-held stocks. It has already allowed state-run firms to export 4.5 MT of wheat. Additionally, the Government permitted private traders to ship additional grain.

Wheat plantings in India are close to previous year’s levels and another bumper crop is in prospect, although forecast is slightly below the 2012 record (93.90 MT) because of limited rainfall in some important producing areas.

While, Russian Federation, European Union (EU), Australia are forecast to face tight supplies which will lead to reduced exports from these countries, larger exports by India will help in easing the market situation.

Subhash Chandra's Essel Group launches Rs 1,000-cr realty fund

Mumbai: The $4-billion Essel Group has launched a Rs 1,000-crore real estate private equity (PE) fund as part of its asset management foray. The fund will have a corpus of Rs 500 crore, with an option to have an additional Rs 500 crore.

Subhash Chandra-promoted media company Zee Entertainment is the principal sponsor and anchor investor in the PE fund. Zee has put in Rs 100 crore and Chandra’s family office trust gave Rs 100 crore as part of the initial closure of the fund, which took place last week, said Amit Goenka, managing director and chief executive of Essel Financial Services, the new financial services arm of Essel Group.

The group got a licence for the fund called ‘India Asset Growth Fund Series I’, which will essentially do debt funding for the residential projects in top six metros, said Goenka.

“We will do last-mile funding and bridge financing facilities to developers and target 20-22 per cent internal rate of returns from our investments,” Goenka added. The group is also looking to launch an offshore fund of $100 million in the next three-four months to augment the first fund.

After Series I, which is focusing on residential assets, the group is also looking to launch Series II sometime next year, which will invest in education assets.

The Series I fund has already deployed some funds and it is in the process of deploying the rest over the next couple of weeks.

The fund has deployed Rs 40 crore in a residential project in Chennai and plans to invest Rs 80 crore in a project in Mumbai next week, followed by a Rs 60 crore investment in a residential project in Gurgaon, he said. “We will mainly compete with non banking finance companies (NBFCs) and PE funds, which do mezzanine financing (a hybrid of debt and equity financing),” he added.

The Essel Group has appointed a six-member investment committee and a 12-member investment committee to manage the fund.

The group has proposed the names of former chairman of Knight Frank, Pranay Vakil, former chairman of Bank of Baroda, Anil Harish, former chairman of PwC, Jairaj Purandhare, and former chief of the Institute of Chartered Accountants India, Mukund Chitale, on its investment committee.

The fund-raising scenario in real estate is bouncing back in 2013. According to data from VCCedge, 15 India-dedicated realty funds have raised $1 billion in 2012, against $911 million by eight funds in 2011.

In 2013, two funds have raised $91 million. Avenue Real Estate Fund has closed its fund by raising $64 million, while ArthVeda Star Fund has raised $26.8 million in 2013.

Indiareit Fund Advisors, the PE arm of Ajay Piramal’s Piramal Enterprises, announced plans to raise Rs 200 crore over the next three months for its fifth domestic real estate fund.

The domestic fund has a total corpus of Rs 750 crore with an option to expand by Rs 250 crore. Indiareit is also planning to launch an offshore fund of $300 million (Rs 1,632 crore) next month from investors in Europe, Asia and Australia.

Other major funds in fund-raising mode include Redfort India Real Estate Fund ($500 million), Shapoorji Pallonji Real Estate Fund ($500 million) and ASK Real Estate Special Opportunities Fund ($220 million)

Sun Pharma gets FDA nod for generic version of Januvia

New Delhi: Indian drugmaker Sun Pharma received a tentative approval from the US drug regulator for generic version of Januvia late last week, fuelling speculation among analysts that the company has challenged the patent on the blockbuster anti-diabetes drug.

This comes as a surprise as Sun has partnered the US based multinational Merck Sharp & Dohme (MSD) in the domestic market to sue Glenmark for the patent infringement on the same drug. While confirming the tentative approval from US Food and Drug Administration (US FDA), a Sun Pharma spokesperson told ET that it can't comment on the nature of filing.

The earliest that Sun can launch the generic version of the drug is in 2022. However, industry experts say an application filed 12 to 14 years before the patents for the drug are set to expire is most likely to be a Para IV application. Apara IV filing means Sun has either challenged the validity of MSD's patent on Januvia (on the monophosphate or the product it markets) or submitted that its generic version wouldn't infringe MSD's patent.

While patent related to Januvia basic compound is set to expire on 2022, patents related to the salt or product (the monophosphate version that is marketed) will only expire in 2026 in the US. "If you check the date on which Sun Pharma filed its abbreviated new drug application for the salt Januvia, it is 18 October 2010, which is two days after NCE-1 date, a cut-off date for filing a Para IV application," an analyst said on condition of anonymity.

Two other generic players which have filed their application around the same time are US based generic giant Mylan and Sandoz, the generic arm of Swiss drugmaker Novartis. Sun Pharma's India strategy on Januvia got firmed up only in 2011 when it entered into an agreement with MSD for marketing, promoting and distributing MSD's diabetes products, including Januvia.

"We are not in litigation with Sun Pharma in the US for sitagliptin (generic name for Januvia). Filing of or tentative approval by USFDA does not provide a right to put the generic product sought in the ANDA on the market till the patent expiry date, which in this case is 2022. We have not taken any legal action against Sun, nor any other generic in the US, as they have taken a position of respect for the basic sitagliptin compound patent," a MSD spokesperson said.

"Assuming, Sun's application is of para IV type, MSD can still legally challenge Sun Pharma before 2022 and if it doesn't, it would have to be ready for a generic version of the drug in the US market, at least four years before its patent on the salt (Januvia) actually expires," the analyst said. Earlier this month, MSD sued Glenmark alleging that two its recently launched anti-diabetes drugs infringe its patent coverage of drugs Januvia and Janumet.

Swedish retailer Rusta sets up India operations

New Delhi: With the Indian retail sector having opened up to foreign players, it is Swedish retailer Rusta that has now announced its plans to set up its operations in the country. While the company has been sourcing finished products from India for the past one decade, the furniture and leisure products manufacturer has now come up with plans to set up its office in India as also up its imports from the country.

""We are very positive about India. India is a huge country and we realized it had to contribute to our growth more than what it is currently,"" said Goran Westerberg, CEO, Rusta.

The company, which has been sourcing goods worth $10 million from India until now, will now increase the same to around $40 million per year as well as increase its manpower as it seeks to buy products directly from suppliers now. ""We realized that running our business by way of third party agents was not a sustainable model...obviously we will grow in terms of the number of offices here too,"" Westerberg said.

The $450 million company deals in a wide range of products including furniture, decorative items, home textiles etc. While the company currently has stores only in Sweden, almost 50% of its products are sourced from other countries in Asia and Europe.

With the new investments in place, Westerberg said India will rank as the company's second biggest market for sourcing after China in the next few years. Currently India remains at the tenth position, ranking after China, Indonesia, Vietnam and others. Almost 45% of products for the company is being sourced from China.

Despite the government allowing 100% foreign direct investment ( FDI) in the single brand retail sector, the company said it is not keen on setting up its stores in the country. Even as opening of the sector will provide India with the necessary skills and competence, Westerberg said the company will first explore Scandinavian countries for expansion before looking at Asia.

""We are looking at India as a long term market. It is a huge challenge to get known here, both as an importer and a retailer,"" he said.

Rusta currently has 67 stores in Sweden and plans to add 10-12 stores every year. The company has five offices in Asia, including in China, Bangkok, Shanghai and now India.

Public sector units spent $8.5 b on IT in FY12: Zinnov

Mumbai: Public sector units (PSUs) spent $8.5 billion in FY12 on IT, more than 2 per cent of their total revenues. It was higher compared with other verticals and mainly for the energy and banking, financial services and insurance (BFSI) verticals, according to a study by market research firm Zinnov.

“IT is viewed to be a major cost reduction enabler in many PSUs, given the automation of processes and integrated IT set-ups. Today, PSUs are looking at IT to analyse customer information efficiently and develop targeted and customised offerings for customers,” said Praveen Bhadada, Director (Market Expansion) at Zinnov.

The PSUs, with revenue growths of 11 per cent since 2009, posted a total turnover of $383 billion in FY12 and employ 1.4 million personnel. About 40 per cent of the PSUs are in the manufacturing sector.

The investment in technology is shaping the growth of the PSUs. Government companies are investing in technology to help address the challenges they faced in the early years of transition towards establishing a transparent and accountable organisation, reducing cost of production and enhancing productivity and customer reach.

“India is a hub of 225 PSUs operating across verticals, with 16 of these companies featuring in the global list of top 2,000 companies. With their growing size and dominance, PSUs have started looking at IT to address global competition,” added Bhadada. Examples include that of State Bank of India and the public sector oil marketing company Bharat Petroleum Corporation Ltd (BPCL). SBI, the country’s largest banker, implemented a global core banking solution, while BPCL made early investments in big data.

The PSUs will post a turnover of more than $1 trillion by 2020. A large part of this will be invested in IT including cloud, big data and mobility.

India, Finland to explore solar energy applications for oil & gas projects

New Delhi: India and Finland have identified several key areas of collaboration in sustainable development for mutual benefits in the oil & gas sector, which includes specific projects in solar energy applications for oil & gas Projects, biofuels & algae based biofuels research and water and waste water management.

Other areas indentified are carbon capture and reformation, Finland's Green Growth & Groove programme for suitable application to Indian scenario and academic institutions/universities for collaborative R&D projects in areas of low carbon growth technologies and sustainable development, oil ministry said in a statement.

An agreement between the two countries on these matters are expected, it said after a bilateral meeting between delegations of the two countries. Indian delegation was represented by Petroleum Minister for State Lakshmi Panabaka and Marja Rislakki, State Secretary, Ministry of Employment & Economy of Finland.