30 September 2004

Rupee ends higher
Mumbai: The rupee finished at 46.00/02 to a dollar on Wednesday. It had closed at 46.1050/1150 against the dollar on Tuesday.

Forwards Market: The six-month forward closed lower at 2.04 per cent (2.30 per cent) while the twelve-month forward closed at 1.75 per cent (1.90 per cent).

G-Secs: The 10-year benchmark 7.37 per cent 2014 paper closed at a yield of 6.22 per cent at a price of Rs108.20, 15 paise lower than the previous close. The 7.38 per cent 2015 paper ended lower at 6.25 per cent at a price of Rs108.95.

Call Rates: Rates went up to 4.75 per cent during the day before easing to 4.25-4.50 per cent towards close.

CBLO market: 125 trades worth Rs 3,766.75 crore were transacted in the rate range of 4.90 to 1.00 per cent.

CRISIL upgrade for SAIL bonds
Mumbai: Crisil has upgraded SAIL's non-convertible bonds and fixed deposit programmes to A and FA+ from BBB and FA respectively.

It also reaffirmed ratings on Tata Steel's non-convertible debentures, fixed deposits and commercial paper programmes. Crisil believes the current steel prices will sustain over the short to medium term.

Stressed Asset Fund to be a Financial Institution - IDBI becomes a bank from Oct.1
Mumbai: The Government has accorded the status of a financial institution to the Stressed Assets Stabilisation Fund (SASF), a Rs.9,000-crore special purpose vehicle that is taking over the non-performing assets of Industrial Development Bank of India.

In a letter to IDBI, the Government has said it has given SASF an institutional status to help it recover dues from defaulters. The institution has moved the Debt Recovery Tribunals or courts in many cases and with this move the Government has given the authority to the SASF to recover dues on its own right. A gazette notification is awaited.

IDBI has also received a communication from the Government declaring the appointed date for its conversion into a commercial bank as of October 1.

Govt. issues bonds for Rs.9,000 crore for the Stressed Assets fund
New Delhi: The Government on Wednesday issued special securities for Rs.9,000 crore towards the creation of the 'Stressed Assets Stabilisation Fund (SASF)' to help Industrial Development Bank of India tackle its problem of stressed assets.

The amount will be invested in non-interest bearing special securities of 20-year maturity with a call option. The transaction is budget neutral for the Government, a Finance Ministry release said.

The amount realised by SASF on the recovery of dues will be paid to the Government annually. The Government will redeem bonds of an equivalent amount, thus leaving IDBI with an equivalent amount of cash. There will be no net out-go from the Government on account of the transaction.

With the cleaning up of IDBI's books, the net NPA position of IDBI is expected to improve, leading to better credit rating and consequent ability to access lower cost funds in the domestic and foreign markets to enable IDBI to compete aggressively for business.

Tata Motors and Leyland upgraded
Mumbai: Crisil has upgraded the ratings of Tata Motors and Ashok Leyland.

The rating agency said the rating upgrade is driven by significant improvement in Tata Motors Ltd's financial risk profile, which it is expected to sustain in the medium term. This improvement is aided by the stronger-than-expected performance of the commercial vehicle (CV) industry in 2004-05 and 2005-06 and the company's successful placement of its $400 million foreign currency convertible bond (FCCB) issue.

Crisil has also upgraded the rating on Ashok Leyland Limited's non-convertible debenture programme because of the significant improvement in its financial risk profile, which it is likely to sustain over the next few years.

The company's foreign currency convertible bond (FCCB) issue of $100 million significantly enhances Ashok Leyland's financial flexibility as it provides it with extremely low-cost funds, which it can use to fund its capital expenditure plans and acquisitions, if any.

29 September 2004

Rupee down sharply - Bonds rise
Mumbai: The rupee closed at 46.1050/1150 against the dollar. On Monday the Indian currency had ended at 45.9550/9650 per dollar.

Forwards Market: The six-month forward closed at 2.30 per cent (1.98 per cent) while the twelve-month forward closed at 1.90 per cent (1.65 per cent).

G-Secs: The 10 year benchmark 7.37 per cent 2014 paper closed at Rs.108.35 at an yield of 6.19 per cent, 7 basis points higher than previous close of 6.12 per cent. The 11-year benchmark 7.38 per cent 2015 paper fell to end at Rs.108.95 and its yield rose to 6.24 per cent against previous close of 6.16 per cent.

Call Rates: In the range of 4.50-4.60 per cent.

CBLO Market: 100 trades worth Rs 2,392.55 crore were transacted in the rate range of 4.35-4.70 per cent.

Rate slab fixed for SGSY loans
New Delhi: The Government has asked the Reserve Bank of India and Nabard to ensure that the loans extended to self-help groups under Swarnjayanti Gram Swarozgar Yojana (SGSY) is made available within a slab of 4 to 6 per cent interest.

Dr. Raghuvansh Prasad Singh, Minister for Rural Development said the banks will have to adopt a pro-active approach to make these programmes a success.

IDBI places floating rate bonds of Rs.100 crore with MFs
Mumbai: Industrial Development Bank of India (IDBI) has privately placed floating rate bonds worth Rs.100 crore with a few mutual funds. ICICI Securities arranged the transaction, an IDBI release said here.

The bonds have a maturity of three years with an innovative coupon structure in which the underlying benchmark reduces every year.

The coupon in the first year will be 15 basis points over the annualised yield of a three-year benchmark Government bond.

In the second year, it will be 25 basis points over the annualised return from a two-year Government bond and in the third year, it will be 35 basis points over the annualised yield from a one-year Government bond.

Tata Life launches pension plan 'Nirvana Plus'
Mumbai: Tata AIG Life Insurance Company has launched 'Nirvana Plus', which it claims is India's only pension plan for individuals with a 10 per cent guaranteed addition to the sum assured every five years.

A press release from the company said it is the sole plan in the country, which covers six critical illnesses such as cancer and heart attack in the first three years.