Rethinking power equipment plan with BGR but also looking at nuclear power, metro rail, monorail and DFCC as opportunities
New delhi: the Japan-based global engineering, construction and electronics giant, has said it would invest another Rs 4,700 crore in India by 2016.
The aim is to expand capacities across business verticals such as construction machinery, information technology (IT) services, transport and power equipment. The move is part of a bigger strategy to expand its global footprint, the Tokyo-headquartered company announced on Monday.
The expansion is aimed to triple the sales of Hitachi India Ltd to Rs 20,000 crore and raise local headcount by 5,600 over the period. “The expansion will comprise providing services in the construction machinery and IT segments, apart from engaging in supplying urban transport equipment for the metro trains or monorails here,” said Junzo Nakajima, executive vice-president for the Asia-Pacific.
India currently accounts for only one per cent – Rs 6,700 crore – of Hitachi’s global sales. The expansion will raise local sales to three per cent of the overall figure by 2016. “Our global revenues would rise from ¥9 trillion to over ¥10 trillion at the end of the period,” said Nakajima.
The company, however, said it was rethinking an earlier plan to set up a power equipment manufacturing facility in a joint venture (JV) with Hyderabad-based BGR Energy Systems. “The Indian power market is going through a slowdown,” noted,” Ichiro Iino, managing director, Hitachi India.
He also said the company was seriously looking at an opportunity to supply nuclear power plants in India, as part of another JV with US-based GE.
India is part of the company’s nuclear business interest outside of Japan, through GE-Hitachi Nuclear Energy. “We are also talking to Delhi Metro Rail Corporation and the Delhi government for supplying metro coaches and monorail systems,” said Iino.
It is also hoping to bid for supplying railway signalling systems, on the Dedicated Freight Corridor project which aims to connect Delhi with Mumbai and Kolkata through an only-cargo rail network.
“The project has been a little slow, though,” observed Iino.
Going forward, Hitachi plans to develop India as a base for exports to expand presence in Africa and West Asia/North Africa.
The company has so far invested Rs 2,300 crore in India, including a desalination plant at Dahej in Gujarat and a solar power generation project at Neemrana in Rajasthan.
“We expect Hitachi India’s revenue for financial year 2013 to grow in double digits,” said Nakajima.
Hitachi currently operates through 24 companies, with facilities across seven states, employing 7,508 people in India.
The overall employee number is set to rise to 13,000 by March 2016
Success in my Habit
Wednesday, December 18, 2013
Pharma major GSK to make Rs 6,400-cr open offer to hike stake in Indian arm
Mumbai: Bullish on the long-term opportunity that India holds, British drug-maker GlaxoSmithKline Plc is set to fork out up to Rs 6,400 crore to increase its stake in its publicly-listed pharmaceutical subsidiary.
In an announcement before market hours on Monday, GSK said it would increase its stake in GlaxoSmithKline Pharmaceuticals Ltd from 50.7 per cent to 75 per cent, at a price of Rs 3,100 a share.
Buoyed by the news, GSK Pharma shares shot up 18.6 per cent to Rs 2,927.40 on the BSE on Monday.
The move comes within a year of GSK upping its stake in its consumer healthcare arm from 43 per cent to 73 per cent, a Rs 4,800- crore transaction. About a month ago, GSK committed to investing Rs 864 crore in a new factory in India, creating 250 jobs.
On the stake-increase, David Redfern, GSK’s Chief Strategy Officer, said the transaction would increase its exposure to a strategically important market. For GSK Pharma shareholders, it would offer a good liquidity opportunity at an attractive premium, he added.
Long-term opportunity
Against the backdrop of price-control measures and patent litigation witnessed in the local market, Redfern told Business Line there were short-term challenges. But the parent company has been investing in India, as it was positive on the long-term opportunity because of an increase in wealth and demand for improved healthcare.
Responding to analyst observations that greater control in the Indian arm would give it greater flexibility in introducing products locally, he said, operations will not be impacted by the decision.
The parent has been continuously reviewing its pharma operations after increasing stake in its consumer healthcare business, he said, adding that there was no specific reason behind the timing of its decision.
In 2009, multinational drug companies Novartis and Pfizer too, had increased stakes in their respective India arms. But, the effort had not been smooth and both companies had to increase their offer price to match their then prevailing share prices.
FUNDING OFFER
GSK does not intend to de-list either consumer healthcare or pharmaceuticals from the local stock-exchanges, Redfern said, adding that it was important to keep both companies listed.
The open offer will be funded through GSK’s existing cash resources. It will be earnings neutral for the first year and accretive thereafter and will not impact expectations for the group’s long-term share buyback programme, the company said.
Offer details
GSK looks to acquire up to 2.06 crore shares, representing 24.3 per cent of the total outstanding shares in the Indian company.
The offer represents a premium of approximately 26 per cent to the company’s closing share price on the National Stock Exchange on December 13. This closing price represents an appreciation of 19 per cent over the last 12 months, GSK said. GSK’s offer is expected to begin in February, pending regulatory clearance.
In an announcement before market hours on Monday, GSK said it would increase its stake in GlaxoSmithKline Pharmaceuticals Ltd from 50.7 per cent to 75 per cent, at a price of Rs 3,100 a share.
Buoyed by the news, GSK Pharma shares shot up 18.6 per cent to Rs 2,927.40 on the BSE on Monday.
The move comes within a year of GSK upping its stake in its consumer healthcare arm from 43 per cent to 73 per cent, a Rs 4,800- crore transaction. About a month ago, GSK committed to investing Rs 864 crore in a new factory in India, creating 250 jobs.
On the stake-increase, David Redfern, GSK’s Chief Strategy Officer, said the transaction would increase its exposure to a strategically important market. For GSK Pharma shareholders, it would offer a good liquidity opportunity at an attractive premium, he added.
Long-term opportunity
Against the backdrop of price-control measures and patent litigation witnessed in the local market, Redfern told Business Line there were short-term challenges. But the parent company has been investing in India, as it was positive on the long-term opportunity because of an increase in wealth and demand for improved healthcare.
Responding to analyst observations that greater control in the Indian arm would give it greater flexibility in introducing products locally, he said, operations will not be impacted by the decision.
The parent has been continuously reviewing its pharma operations after increasing stake in its consumer healthcare business, he said, adding that there was no specific reason behind the timing of its decision.
In 2009, multinational drug companies Novartis and Pfizer too, had increased stakes in their respective India arms. But, the effort had not been smooth and both companies had to increase their offer price to match their then prevailing share prices.
FUNDING OFFER
GSK does not intend to de-list either consumer healthcare or pharmaceuticals from the local stock-exchanges, Redfern said, adding that it was important to keep both companies listed.
The open offer will be funded through GSK’s existing cash resources. It will be earnings neutral for the first year and accretive thereafter and will not impact expectations for the group’s long-term share buyback programme, the company said.
Offer details
GSK looks to acquire up to 2.06 crore shares, representing 24.3 per cent of the total outstanding shares in the Indian company.
The offer represents a premium of approximately 26 per cent to the company’s closing share price on the National Stock Exchange on December 13. This closing price represents an appreciation of 19 per cent over the last 12 months, GSK said. GSK’s offer is expected to begin in February, pending regulatory clearance.
SpiceJet and Tigerair to tap each other’s network with interline pact
Expects to wipe out accumulated losses by roping in potential investors; rebound to profits in a year
Hyderabad/ Mumbai: The Singapore-based Tigerair on Monday grabbed the first-mover advantage over its rival AirAsia in the lucrative India-Southeast Asia airline market by entering into an interline agreement with India’s second largest low-cost carrier SpiceJet.
Low-cost airline Tigerair, in which Singapore Airlines has 33 per cent stake, has been slugging it out with the Kuala Lumpur-based AirAsia, the largest player in this space in the Southeast Asian market. The move comes just a few months before AirAsia (which has a joint venture with the Tatas) is set to launch a low-cost domestic airline in India.
Under the new agreement with Singapore’s largest low-cost carrier, customers travelling on SpiceJet’s domestic network from 14 Indian cities can enjoy seamless connectivity through the Hyderabad airport onto Tigerair’s Singapore-bound flights from January 6, 2014. With this move, Tigerair would be able to carry passengers from India to Singapore through 20 cities, including six from which it flies directly to Singapore.
The other 14 cities would be Ahmedabad, Bhopal, Mumbai, Kolkata, Coimbatore, Delhi, Goa, Indore, Mangalore, Madurai, Pune, Rajahmundry, Tirupati and Visakhapatnam. Tigerair flies directly to Chennai, Trichy, Trivandrum, Bangalore, Kochi and Hyderabad.
The move will preempt AirAsia’s ambitious strategy to add more cities from where it can get passengers and connect them to Kuala Lumpur and Bangkok, among other destinations, through hubs like Chennai. Currently, AirAsia flies directly from Kuala Lumpur to Chennai, Kochi, Kolkata, Trichy and Bangalore while Thai AirAsia flies from Bangkok to Kolkata and Chennai. With AirAsia setting up a domestic airline, it will have access to passengers across the country.
Starting January 12, 2014, Tigerair customers from Singapore will also enjoy easy access to SpiceJet's domestic network. Both airlines will use their Navitare reservation systems, integrated to enable the issue of single tickets by each.
“Looking at interlining is a part of our strategy and Tigerair is our first partner. Other discussions will take place and we expect more such arrangements,” Sanjiv Kapoor, chief operating officer of SpiceJet, told the media. Stating that SpiceJet’s move would increase competition for AirAsia, which hopes to connect various cities in India to Kuala Lumpur from its Chennai base, sources said SpiceJet was expecting an additional 200 passengers daily to and from Hyderabad with its tie-up with Tigerair, besides expecting 6 per cent revenue growth in the first year of the alliance.
According to a JPMorgan research report, the two had 6 per cent share each of the India-Asean market in 2012. Their share of the South India-Asean market is bigger, with Tigerair having 13 per cent market share and AirAsia 11 per cent. On an all-India scale, they are still small players with a share of 4 per cent each of the India-Asia market.
Analysts say the relationship beginning on the Singapore route will likely be extended to others cities in Southeast Asia, including those in Indonesia and the Philippines, and Australia. AirAsia also has joint ventures in the Philippines, Indonesia and Thailand. On Monday, Tigerair had announced the signing of an agreement with China Airlines to set up a new low-cost carrier in Taiwan and the expansion of its partnership with Singapore Airline's low-cost carrier Scoot.
“The agreement will bring operational benefits rather than financial as of now as there is no equity infusion. The deal will enable network expansion and given the higher inbound and outbound travel as compared to domestic growth rates, it should improve the load factors. Given that the airlines can tap into each other’s network, it is a win-win for both,” said Deven Choksey, managing director of KR Choksey Shares and Securities.
“From SpiceJet’s point of view, our load factors are currently around 70 per cent, which could be raised further using the Tigerair relationship,” said Kapoor. Tigerair's load factors range between the mid 70s and low 80s in percentage terms.
Refuting reports that SpiceJet would shrink its fleet as well as the route plan, Kapoor said the company would rationalise its routes and planned to redeploy its fleet into a more profitable network design. Even as network revamp processes are underway, the airline officially confirmed that negotiations were on for equity sale.
"We are talking to people. We want the right partner from an equity perspective... Hopefully soon," Kapoor said, without disclosing more details. On the accumulated losses, currently around Rs 1,137 crore, he said there were ways to address such issues. “There are some possible solutions to come out of these. We are talking to potential investors,” he said, declining to comment further.
Hyderabad/ Mumbai: The Singapore-based Tigerair on Monday grabbed the first-mover advantage over its rival AirAsia in the lucrative India-Southeast Asia airline market by entering into an interline agreement with India’s second largest low-cost carrier SpiceJet.
Low-cost airline Tigerair, in which Singapore Airlines has 33 per cent stake, has been slugging it out with the Kuala Lumpur-based AirAsia, the largest player in this space in the Southeast Asian market. The move comes just a few months before AirAsia (which has a joint venture with the Tatas) is set to launch a low-cost domestic airline in India.
Under the new agreement with Singapore’s largest low-cost carrier, customers travelling on SpiceJet’s domestic network from 14 Indian cities can enjoy seamless connectivity through the Hyderabad airport onto Tigerair’s Singapore-bound flights from January 6, 2014. With this move, Tigerair would be able to carry passengers from India to Singapore through 20 cities, including six from which it flies directly to Singapore.
The other 14 cities would be Ahmedabad, Bhopal, Mumbai, Kolkata, Coimbatore, Delhi, Goa, Indore, Mangalore, Madurai, Pune, Rajahmundry, Tirupati and Visakhapatnam. Tigerair flies directly to Chennai, Trichy, Trivandrum, Bangalore, Kochi and Hyderabad.
The move will preempt AirAsia’s ambitious strategy to add more cities from where it can get passengers and connect them to Kuala Lumpur and Bangkok, among other destinations, through hubs like Chennai. Currently, AirAsia flies directly from Kuala Lumpur to Chennai, Kochi, Kolkata, Trichy and Bangalore while Thai AirAsia flies from Bangkok to Kolkata and Chennai. With AirAsia setting up a domestic airline, it will have access to passengers across the country.
Starting January 12, 2014, Tigerair customers from Singapore will also enjoy easy access to SpiceJet's domestic network. Both airlines will use their Navitare reservation systems, integrated to enable the issue of single tickets by each.
“Looking at interlining is a part of our strategy and Tigerair is our first partner. Other discussions will take place and we expect more such arrangements,” Sanjiv Kapoor, chief operating officer of SpiceJet, told the media. Stating that SpiceJet’s move would increase competition for AirAsia, which hopes to connect various cities in India to Kuala Lumpur from its Chennai base, sources said SpiceJet was expecting an additional 200 passengers daily to and from Hyderabad with its tie-up with Tigerair, besides expecting 6 per cent revenue growth in the first year of the alliance.
According to a JPMorgan research report, the two had 6 per cent share each of the India-Asean market in 2012. Their share of the South India-Asean market is bigger, with Tigerair having 13 per cent market share and AirAsia 11 per cent. On an all-India scale, they are still small players with a share of 4 per cent each of the India-Asia market.
Analysts say the relationship beginning on the Singapore route will likely be extended to others cities in Southeast Asia, including those in Indonesia and the Philippines, and Australia. AirAsia also has joint ventures in the Philippines, Indonesia and Thailand. On Monday, Tigerair had announced the signing of an agreement with China Airlines to set up a new low-cost carrier in Taiwan and the expansion of its partnership with Singapore Airline's low-cost carrier Scoot.
“The agreement will bring operational benefits rather than financial as of now as there is no equity infusion. The deal will enable network expansion and given the higher inbound and outbound travel as compared to domestic growth rates, it should improve the load factors. Given that the airlines can tap into each other’s network, it is a win-win for both,” said Deven Choksey, managing director of KR Choksey Shares and Securities.
“From SpiceJet’s point of view, our load factors are currently around 70 per cent, which could be raised further using the Tigerair relationship,” said Kapoor. Tigerair's load factors range between the mid 70s and low 80s in percentage terms.
Refuting reports that SpiceJet would shrink its fleet as well as the route plan, Kapoor said the company would rationalise its routes and planned to redeploy its fleet into a more profitable network design. Even as network revamp processes are underway, the airline officially confirmed that negotiations were on for equity sale.
"We are talking to people. We want the right partner from an equity perspective... Hopefully soon," Kapoor said, without disclosing more details. On the accumulated losses, currently around Rs 1,137 crore, he said there were ways to address such issues. “There are some possible solutions to come out of these. We are talking to potential investors,” he said, declining to comment further.
Rs 1-cr worth flowers exported to Qatar
Kochi: The Cochin International Airport Ltd on Monday exported a consignment of fresh flowers to Doha on the occasion of Qatar National Day, which falls on December 18.
The shipment of 10,000 packets totalling 53,000 kg of flowers from Kerala and Tamil Nadu has been despatched through a special Etihad freighter. The Rs 1-crore export order was executed by procuring flowers from different locations in the two States. They consisted of jasmine, lilies, polyanthus, tuberose etc.
The perishable centre at CIAL, which can handle highly perishable products, is the key selling point to attract this type of business to Kochi. The centre is capable of handling temperature sensitive products such as vegetables, fruits, flowers, marine and pharma items etc. Highly perishable goods are brought to the centre in reefer trucks in order to maintain the freshness and quality of the produce.
Established in 2009 with the financial assistance of Agricultural Processed Food Products Export Development Authority (APEDA), the centre has 25,000 sq ft area, with ambient temperature of 18 degrees centigrade.
It has computerised embedded weighing stations, separate cool rooms with a temperature range of 0 to -10 degree centigrade, 24x7 camera surveillance etc.
The shipment of 10,000 packets totalling 53,000 kg of flowers from Kerala and Tamil Nadu has been despatched through a special Etihad freighter. The Rs 1-crore export order was executed by procuring flowers from different locations in the two States. They consisted of jasmine, lilies, polyanthus, tuberose etc.
The perishable centre at CIAL, which can handle highly perishable products, is the key selling point to attract this type of business to Kochi. The centre is capable of handling temperature sensitive products such as vegetables, fruits, flowers, marine and pharma items etc. Highly perishable goods are brought to the centre in reefer trucks in order to maintain the freshness and quality of the produce.
Established in 2009 with the financial assistance of Agricultural Processed Food Products Export Development Authority (APEDA), the centre has 25,000 sq ft area, with ambient temperature of 18 degrees centigrade.
It has computerised embedded weighing stations, separate cool rooms with a temperature range of 0 to -10 degree centigrade, 24x7 camera surveillance etc.
India likely to become global production hub for compact superbikes
New Delhi: Having changed the dynamics of lowcost manufacturing and become a global hub for small cars, India is now poised to emerge a centre for producing compact superbikes as Indian customers graduate to the next level of biking.
Several global and Indian bike makers plan to utilise India's mass-production base of 16-million bikes and scooter to roll out sports bikes in the 250cc capacity.
British firm Triumph has finalised its strategy to roll out its next global platform of the 250cc version of the Daytona from its greenfield facility near Bangalore, and its American rival Harley-Davidson is expected to follow suit. Chennai-based TVS Motors is developing new platform for German luxury automaker BMW, while Hero MotoCorp would showcase its all-new 250cc bike, made in collaboration with its American subsidiary Erik Buell Racing, in the 2014 Auto Expo.
"India is poised to become one of the largest sports bikes market in the 250cc segment," Vimal Sumbly, managing director at Triumph India, said.
"It is the most promising segment as we expect a large number of customers moving up the value chain and we are already working in that direction to tap the potential market," he told ET.
Triumph plans to roll out its bikes from India in the next two years.
Specialist bike makers are trying to cash in on Indian customers' increasing preference for higher displacement and bigger engine bikes, backed increasing aspiration levels and growing incomes of the new generation of buyers.
Automotive research and advisory firm Emerging Markets Automotive Advisors expects sale of big bikes in India to jump 50 per cent this year to 167,000 units from nearly 112,000 big bikes in 2012.EMMAAA forecasts superbike sales to rise to 708,000 units in 2022.
"The introduction of big brands like Harley and Triumph in the last few years has created this thirst for top-rated motoring experience and motorcycle enthusiasts have finally found access to global spec, high-powered speed machines," Deepesh Rathore, director at EMMAAA, said. "Going forward global manufacturers like Triumph, BWM and Harley-Davidson are rushing to develop smaller capacity machines to grow the market and quench the thirst of Indian bikers," he added.
The average motorcycle engine displacement index (AMEDI) has increased by around 8 per cent in the past decade. EMMAAA expects this index to climb much faster going by the shift in customer's preference and higher disposable incomes.
Bajaj Auto has the largest portfolio of sports bikes in the country, thanks to its Austrian subsidiary KTM. In the past Royal Enfield ruled the Indian big bike market with its 350-500 cc Bullets.
In Asia, sales of superbikes — having engine displacement in excess of 1,000 cc and costing upwards of Rs 10 lakh — increased 20 per cent last year, second only to 26 per cent growth in Latin America.
But in India super bike sales have slowed this year due to rapid devaluation of the rupee that has made imports expensive. This has forced manufacturers to go for smaller engine sizes to improve affordability and have a wider larger customer base in the coming years.
Harley-Davidson recently unveiled its Street range, the smallest Harleys with engine sizes of 750cc and 500cc. Its entry-level Superlow bike range starts at Rs 5.7 lakh.
Global players are also assembling bikes here to benefit from lower taxes of around 30 per cent compared to 100 per cent import duty on fully built bikes and scooters. Local assembly helped Harley cut the price of its iconic Fat Boy by almost 30 per cent to around Rs 15 lakh. Triumph, too, assembles six of the 10 bikes it sells in India at its facility in Manesar. Harley-Davidson plans to convert its Haryana CKD facility into a full-fledged manufacturing base.
Several global and Indian bike makers plan to utilise India's mass-production base of 16-million bikes and scooter to roll out sports bikes in the 250cc capacity.
British firm Triumph has finalised its strategy to roll out its next global platform of the 250cc version of the Daytona from its greenfield facility near Bangalore, and its American rival Harley-Davidson is expected to follow suit. Chennai-based TVS Motors is developing new platform for German luxury automaker BMW, while Hero MotoCorp would showcase its all-new 250cc bike, made in collaboration with its American subsidiary Erik Buell Racing, in the 2014 Auto Expo.
"India is poised to become one of the largest sports bikes market in the 250cc segment," Vimal Sumbly, managing director at Triumph India, said.
"It is the most promising segment as we expect a large number of customers moving up the value chain and we are already working in that direction to tap the potential market," he told ET.
Triumph plans to roll out its bikes from India in the next two years.
Specialist bike makers are trying to cash in on Indian customers' increasing preference for higher displacement and bigger engine bikes, backed increasing aspiration levels and growing incomes of the new generation of buyers.
Automotive research and advisory firm Emerging Markets Automotive Advisors expects sale of big bikes in India to jump 50 per cent this year to 167,000 units from nearly 112,000 big bikes in 2012.EMMAAA forecasts superbike sales to rise to 708,000 units in 2022.
"The introduction of big brands like Harley and Triumph in the last few years has created this thirst for top-rated motoring experience and motorcycle enthusiasts have finally found access to global spec, high-powered speed machines," Deepesh Rathore, director at EMMAAA, said. "Going forward global manufacturers like Triumph, BWM and Harley-Davidson are rushing to develop smaller capacity machines to grow the market and quench the thirst of Indian bikers," he added.
The average motorcycle engine displacement index (AMEDI) has increased by around 8 per cent in the past decade. EMMAAA expects this index to climb much faster going by the shift in customer's preference and higher disposable incomes.
Bajaj Auto has the largest portfolio of sports bikes in the country, thanks to its Austrian subsidiary KTM. In the past Royal Enfield ruled the Indian big bike market with its 350-500 cc Bullets.
In Asia, sales of superbikes — having engine displacement in excess of 1,000 cc and costing upwards of Rs 10 lakh — increased 20 per cent last year, second only to 26 per cent growth in Latin America.
But in India super bike sales have slowed this year due to rapid devaluation of the rupee that has made imports expensive. This has forced manufacturers to go for smaller engine sizes to improve affordability and have a wider larger customer base in the coming years.
Harley-Davidson recently unveiled its Street range, the smallest Harleys with engine sizes of 750cc and 500cc. Its entry-level Superlow bike range starts at Rs 5.7 lakh.
Global players are also assembling bikes here to benefit from lower taxes of around 30 per cent compared to 100 per cent import duty on fully built bikes and scooters. Local assembly helped Harley cut the price of its iconic Fat Boy by almost 30 per cent to around Rs 15 lakh. Triumph, too, assembles six of the 10 bikes it sells in India at its facility in Manesar. Harley-Davidson plans to convert its Haryana CKD facility into a full-fledged manufacturing base.
Monday, December 16, 2013
Torrent to buy Elder’s drugs biz for Rs 2,000 cr
Mumbai: Ahmedabad headquartered Torrent Pharmaceuticals is set to buy Elder Pharmaceuticals’ branded drugs business in India and Nepal for about Rs 2,000 crore.
The transaction, which puts a lid on several weeks of speculation, helps bail out Mumbai-based Elder Pharma, saddled with debt of about Rs 1,300 crore.
Alok Saxena, Elder Pharma’s Managing Director and Chief Executive, said the agreement formalised between the two companies addressed recent challenges faced by Elder Pharma, besides significantly helping to de-leverage the company’s balance sheet.
Elder Pharma’s shares fell Rs 26.55, or 8 per cent, to close at Rs 298.30 on the BSE, while Torrent Pharma’s fell Rs 20.20, or
4 per cent, to Rs 479.50.
The Rs 1,400-crore Elder Pharma will now be left with its in-licensing deals, anti-infectives and exports business. The company has about 25 licensing partners whose products it sells in India. It will also continue to manufacture products at its manufacturing facilities and supply these to Torrent for up to three years.
The Rs 3,200-crore Torrent Pharma is the flagship of the Torrent Group. Its buyout of Elder’s domestic branded drugs business comes at a time when acquisition of local drug companies by foreign owners is being closely watched by the Government.
Earlier this year, Elder Pharma had said that it had appointed advisors to chart out different options to raise funds. The options included hiving off a business, selling brands or getting an equity partner.
Around the same time, sending conflicting signals to investors, Elder Pharma went ahead and acquired UK-based Max Healthcare for an undisclosed sum, marking its entry into the over-the-counter business.
Besides NeutraHealth, its fully owned subsidiary in the UK, it has a majority stake in Ghana’s Wincom Formulations and Bulgaria’s Biomeda OOD Ltd.
Crossover to Torrent
Torrent said it will fund the acquisition through a mix of internal accruals and bank borrowings. The transaction will strengthen its core prescription-based business, Sudhir Mehta, Torrent Group Chairman, said in a statement.
The transaction is expected to close in the first six months of 2014, subject to regulatory and shareholder approvals.
Elder’s domestic business has a basket of 30 brands in segments, including women’s healthcare, pain management, wound-care and nutraceuticals. Its flagship product Shelcal, estimated to gross sales of over Rs 170 crore, also crosses over to Torrent.
The transaction will also involve the transfer of employees engaged in sales, marketing and operations of the local business, but company officials were not available to provide the details.
The transaction, which puts a lid on several weeks of speculation, helps bail out Mumbai-based Elder Pharma, saddled with debt of about Rs 1,300 crore.
Alok Saxena, Elder Pharma’s Managing Director and Chief Executive, said the agreement formalised between the two companies addressed recent challenges faced by Elder Pharma, besides significantly helping to de-leverage the company’s balance sheet.
Elder Pharma’s shares fell Rs 26.55, or 8 per cent, to close at Rs 298.30 on the BSE, while Torrent Pharma’s fell Rs 20.20, or
4 per cent, to Rs 479.50.
The Rs 1,400-crore Elder Pharma will now be left with its in-licensing deals, anti-infectives and exports business. The company has about 25 licensing partners whose products it sells in India. It will also continue to manufacture products at its manufacturing facilities and supply these to Torrent for up to three years.
The Rs 3,200-crore Torrent Pharma is the flagship of the Torrent Group. Its buyout of Elder’s domestic branded drugs business comes at a time when acquisition of local drug companies by foreign owners is being closely watched by the Government.
Earlier this year, Elder Pharma had said that it had appointed advisors to chart out different options to raise funds. The options included hiving off a business, selling brands or getting an equity partner.
Around the same time, sending conflicting signals to investors, Elder Pharma went ahead and acquired UK-based Max Healthcare for an undisclosed sum, marking its entry into the over-the-counter business.
Besides NeutraHealth, its fully owned subsidiary in the UK, it has a majority stake in Ghana’s Wincom Formulations and Bulgaria’s Biomeda OOD Ltd.
Crossover to Torrent
Torrent said it will fund the acquisition through a mix of internal accruals and bank borrowings. The transaction will strengthen its core prescription-based business, Sudhir Mehta, Torrent Group Chairman, said in a statement.
The transaction is expected to close in the first six months of 2014, subject to regulatory and shareholder approvals.
Elder’s domestic business has a basket of 30 brands in segments, including women’s healthcare, pain management, wound-care and nutraceuticals. Its flagship product Shelcal, estimated to gross sales of over Rs 170 crore, also crosses over to Torrent.
The transaction will also involve the transfer of employees engaged in sales, marketing and operations of the local business, but company officials were not available to provide the details.
AP to have 2 solar cities
Hyderabad: Andhra Pradesh will have two solar cities – one each in Telangana and coastal Andhra regions. They will be developed as part of the national plan unveiled by the Union Ministry of Renewable Energy.
The Ministry has identified Vijayawada in coastal Andhra and Mahabubnagar in Telangana regions to be developed as solar cities.
The MNRE has so far given in principle approval for 54 locations in the country to develop solar cities. In 2011, it announced a national plan to develop 60 solar cities.
Master plan
The master plan of Vijayawada city has been prepared with an estimated cost of Rs 256.50 crore for various projects on solar grid connected and off grid applications, waste to energy, bio-methanisation, solar water heating systems etc.
In contrast, Mahabubnagar Municipality is yet to take action for preparation of the Master Plan, according to the Union Minister, Farooq Abdullah.
Funds released
For Vijayawada solar city, an amount of Rs 12.20 lakh has been released for the preparation of master plan and setting up a solar city cell and promotional activities, the Minister said in a written reply in the Rajya Sabha.
A solar city aims to reduce a minimum of 10 per cent of its projected demand of conventional energy through generation from renewable energy installations and energy efficiency measures.
The time required depends on interest and efforts taken by the city and availability of funds.
The Ministry has identified Vijayawada in coastal Andhra and Mahabubnagar in Telangana regions to be developed as solar cities.
The MNRE has so far given in principle approval for 54 locations in the country to develop solar cities. In 2011, it announced a national plan to develop 60 solar cities.
Master plan
The master plan of Vijayawada city has been prepared with an estimated cost of Rs 256.50 crore for various projects on solar grid connected and off grid applications, waste to energy, bio-methanisation, solar water heating systems etc.
In contrast, Mahabubnagar Municipality is yet to take action for preparation of the Master Plan, according to the Union Minister, Farooq Abdullah.
Funds released
For Vijayawada solar city, an amount of Rs 12.20 lakh has been released for the preparation of master plan and setting up a solar city cell and promotional activities, the Minister said in a written reply in the Rajya Sabha.
A solar city aims to reduce a minimum of 10 per cent of its projected demand of conventional energy through generation from renewable energy installations and energy efficiency measures.
The time required depends on interest and efforts taken by the city and availability of funds.
Rs 8,000 cr projects in oil, gas sector approved: Moily
New Delhi: The Cabinet Committee on Investments, headed by Prime Minister Manmohan Singh has cleared Rs 7,947-crore worth projects in the oil and gas sector, Minister for Petroleum and Natural Gas M. Veerappa Moily said here on Friday.
Five projects were taken up by the high-level panel on December 9. These projects involve companies such as IOC, CPCL and HPCL.
The Rs 2,379 crore Assam renewal project taken up by ONGC for the revamp and replacement of various installations has also been cleared.
Moily said that the panel also cleared a proposed Rs 5,200 crore worth LNG terminal project of GSPC at Mundra.
Subsidy transfer
The Minister said that the scheme of direct transfer of cooking gas subsidy into bank accounts has been successful. As on December 1, Rs 1,615 crore subsidy has been transferred to bank accounts of 1.274 crore domestic cooking gas customers.
The Ministry has also filed a petition and an affidavit for modification/clarification stating that Aadhaar is mandatory for receiving subsidy in bank accounts after the expiry of the three-month grace period.
Suggestions
Moily also hinted that an expert panel’s call for a Rs 5 a litre hike in diesel and Rs 250 increase in LPG rates will be diluted, saying that a balanced view keeping consumer interest in mind would be taken, according to news agency PTI. The government-appointed Kirit Parikh committee suggested an “immediate” hike in prices of diesel by Rs 5 a litre, Rs 4 per litre in kerosene and Rs 250 per cylinder in LPG, reducing annual entitlement of subsidised cooking gas cylinder from six from nine and phase out diesel subsidy in one year to cut a record subsidy burden.
“Economically that is the right decision but how practical is it, how we can apply (it), that is something we have to take a view on it,” Moily told reporters in the Capital.
The Minister said the suggestions given by the Committee are “very good” as they will help restore fiscal balance.
“If the country has to go forward, reform is a must. But the question is whether we can implement what has been recommended, because we have to balance between the consumer (interest) and government revenue. A balanced view will be taken on the report,” he said.
Five projects were taken up by the high-level panel on December 9. These projects involve companies such as IOC, CPCL and HPCL.
The Rs 2,379 crore Assam renewal project taken up by ONGC for the revamp and replacement of various installations has also been cleared.
Moily said that the panel also cleared a proposed Rs 5,200 crore worth LNG terminal project of GSPC at Mundra.
Subsidy transfer
The Minister said that the scheme of direct transfer of cooking gas subsidy into bank accounts has been successful. As on December 1, Rs 1,615 crore subsidy has been transferred to bank accounts of 1.274 crore domestic cooking gas customers.
The Ministry has also filed a petition and an affidavit for modification/clarification stating that Aadhaar is mandatory for receiving subsidy in bank accounts after the expiry of the three-month grace period.
Suggestions
Moily also hinted that an expert panel’s call for a Rs 5 a litre hike in diesel and Rs 250 increase in LPG rates will be diluted, saying that a balanced view keeping consumer interest in mind would be taken, according to news agency PTI. The government-appointed Kirit Parikh committee suggested an “immediate” hike in prices of diesel by Rs 5 a litre, Rs 4 per litre in kerosene and Rs 250 per cylinder in LPG, reducing annual entitlement of subsidised cooking gas cylinder from six from nine and phase out diesel subsidy in one year to cut a record subsidy burden.
“Economically that is the right decision but how practical is it, how we can apply (it), that is something we have to take a view on it,” Moily told reporters in the Capital.
The Minister said the suggestions given by the Committee are “very good” as they will help restore fiscal balance.
“If the country has to go forward, reform is a must. But the question is whether we can implement what has been recommended, because we have to balance between the consumer (interest) and government revenue. A balanced view will be taken on the report,” he said.
India-New Zealand trade to double by the year 2020
Ahmedabad: Bilateral trade between India and New Zealand doubled in five years, growing from NZ $620 million in 2007 to NZ $1.1 billion in 2012. Speaking at the second India-New Zealand Business Forum at a city club, Jan Henderson, New Zealand high commissioner to India said, "In 2013, the trade is expected to be NZ $1.2 billion, a slight increase due to economic slowdown in the market. We expect the trade to double by 2020".
The two-thirds of the contribution are made by New Zealand in the bilateral trade which exports majorly commodities, coal, oil and wood to India. In reverse, India exports gems, jewellery, spices, tea and horticulture products. "We are in negotiations with the central government for free trade agreement between the two countries", added Henderson. In 2012, numbers of skilled migrants from India to New Zealand were second highest, behind China.
New Zealand based universities are in talks with National Dairy Development Board to provide technical assistance for increasing dairy production and develop agri-business in India.
In recent years, New Zealand has emerged as one of the most favorable destinations for education for Indian students. "Last year 11,349 Indian students took admissions in New Zealand's educational institutions contributing NZ $250 million to the economy. The numbers are expected to increase by 5-7 percent this year", said Ziena Jalil, regional director for south Asia, Education New Zealand.
More than 1,00,000 Indians reside in New Zealand and according to the latest census Hindi is the fourth most widely spoken language in New Zealand. Last year 30,000 Indian tourists visited New Zealand consisting mostly of the honeymoon couples.
The two-thirds of the contribution are made by New Zealand in the bilateral trade which exports majorly commodities, coal, oil and wood to India. In reverse, India exports gems, jewellery, spices, tea and horticulture products. "We are in negotiations with the central government for free trade agreement between the two countries", added Henderson. In 2012, numbers of skilled migrants from India to New Zealand were second highest, behind China.
New Zealand based universities are in talks with National Dairy Development Board to provide technical assistance for increasing dairy production and develop agri-business in India.
In recent years, New Zealand has emerged as one of the most favorable destinations for education for Indian students. "Last year 11,349 Indian students took admissions in New Zealand's educational institutions contributing NZ $250 million to the economy. The numbers are expected to increase by 5-7 percent this year", said Ziena Jalil, regional director for south Asia, Education New Zealand.
More than 1,00,000 Indians reside in New Zealand and according to the latest census Hindi is the fourth most widely spoken language in New Zealand. Last year 30,000 Indian tourists visited New Zealand consisting mostly of the honeymoon couples.
ISB to help 1,000 students establish tech start-ups
Hyderabad: Indian School of Business, which charges a premium for its courses, is going to do something different. It is going to help 1,000 engineering students establish start-ups, realising their entrepreneurial dreams.
Those who want to become entrepreneurs can opt for an elective on entrepreneurship in the first semester of their third year.
In association with the IT Ministry of Andhra Pradesh Government, ISB will select 50 students each from 10 top engineering colleges. ISB is in the process of preparing a curriculum for the elective, which will be introduced from the second half of next calendar year.
“We will pick them in the third year. And for the next four semesters, they will undergo training on various aspects of starting an enterprise. Right from turning a business idea into a business project to execute it,” Aruna Reddy of ISB’s Entrepreneurship Centre, directing the initiative, told Business Line.
At the end of the course, short-listed students would be invited present their project ideas to a gathering of PEs and angel investors at the ISB.
From the Government side, Jawahar Knowledge Centres is funding and coordinating the programme. IIIT (Hyderabad), BITS (Hyderabad), NIT (Warangal) and Srinidhi institute would act as hub centres. Faculty from these centres would get training from the business school. They, in turn, would train the faculty of the other colleges that will join the course.
The State Government would collect Rs 2,000 from each student taking up the entrepreneurship course. “Instead of ending up as job seekers, they can employ people. We will connect them with the seed funding agencies and private equity players,” Sanjay Jaju, Principal Secretary (IT and Communication, Govt of AP), said.
Amarnath Reddy Atmakuri, Chief Executive Officer of JKC, said only a fraction of the two lakh employees found jobs, leaving a large number of students jobless. “But if you help them turn entrepreneurs, they can provide jobs instead,” he said.
Though they are tying up with only 10 engineering colleges in the initiative, the Government is planning to bring in more colleges under the purview of the programme.
“The students will have both theoretical and practical classes. They will get to listen to experts once in six months. We need to improve product ecosystem in order to create more jobs,” Ponnala Lakshmaiah, State Minister for IT, said.
Those who want to become entrepreneurs can opt for an elective on entrepreneurship in the first semester of their third year.
In association with the IT Ministry of Andhra Pradesh Government, ISB will select 50 students each from 10 top engineering colleges. ISB is in the process of preparing a curriculum for the elective, which will be introduced from the second half of next calendar year.
“We will pick them in the third year. And for the next four semesters, they will undergo training on various aspects of starting an enterprise. Right from turning a business idea into a business project to execute it,” Aruna Reddy of ISB’s Entrepreneurship Centre, directing the initiative, told Business Line.
At the end of the course, short-listed students would be invited present their project ideas to a gathering of PEs and angel investors at the ISB.
From the Government side, Jawahar Knowledge Centres is funding and coordinating the programme. IIIT (Hyderabad), BITS (Hyderabad), NIT (Warangal) and Srinidhi institute would act as hub centres. Faculty from these centres would get training from the business school. They, in turn, would train the faculty of the other colleges that will join the course.
The State Government would collect Rs 2,000 from each student taking up the entrepreneurship course. “Instead of ending up as job seekers, they can employ people. We will connect them with the seed funding agencies and private equity players,” Sanjay Jaju, Principal Secretary (IT and Communication, Govt of AP), said.
Amarnath Reddy Atmakuri, Chief Executive Officer of JKC, said only a fraction of the two lakh employees found jobs, leaving a large number of students jobless. “But if you help them turn entrepreneurs, they can provide jobs instead,” he said.
Though they are tying up with only 10 engineering colleges in the initiative, the Government is planning to bring in more colleges under the purview of the programme.
“The students will have both theoretical and practical classes. They will get to listen to experts once in six months. We need to improve product ecosystem in order to create more jobs,” Ponnala Lakshmaiah, State Minister for IT, said.
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