Birlas buy 2.86 per cent ICICI stake in Kesoram Industries
Kolkata: In a bid to avert possible takeover, BK Birla group have bought out the entire holding of ICICI in Kesoram Industries. ICICI had in all held 15 lakh shares, or 2.86 per cent of the equity, in their flagship company. ICICI had already sold off 10 lakh shares to the group, the balance five lakh shares were bought by the Birlas on Thursday at Rs 60 per share.

Apart from BK Birla group’s promoter stake of 33 per cent, financial institutions, including Unit Trust of India and Life Insurance Corporation, were the only ones to hold a good chunk of Kesoram equity. The combined institutional holding of 21.96 per cent now stands slightly reduced after sale of ICICI’s holding. ICICI had earlier reportedly turned down institutional brokers’ offer to purchase the balance shares and instead sold the same to BK Birla group. The buy out comes in the wake of Dubai-based NRI Shiv Kumar’s aggressive cornering of Kesoram shares.
Back to News Review index page 

HLL to revamp brand portfolio management
Mumbai: Hindustan Lever Ltd. (HLL) has commenced a major restructuring exercise for enhanced product portfolio management. While company has 110 brands on its price-list, now the FMCG major has decided to focus on only 30 brands. The short-listing has been done on the basis of absolute size, brand strength and uniqueness, competitive positioning and growth potential.

Currently, these 30 brands account for 75 per cent of HLL's aggregate FMCG business. The company has not disclosed the names short-listed brands, which are however, believed to cover all key categories and segments. Mr. MS Banga, chairman HLL has reportedly stated that with the market getting crowded with a plethora of choices to customer, the company wanted to reduce the brand clutter for the customer, while ensuring that its focus does not get diluted by large spread of brands.

The ORG-Marg data for April-December 2000 had shown that Lux toilet soap has a 13.4 per cent market share and Lifebuoy has 12.6 per cent in toilet soaps category. In detergent cakes, Rin Supreme has a 16.6 per cent market share in detergent cakes. In the toothpaste market, Close-Up has 18.6 per cent market share with Pepsodent at 11.5 per cent.
Back to News Review index page 

Videocon to foray into insurance
New Delhi: Videocon in a significant diversification move has said that it would apply for registration of its proposed non-life insurance venture next week.

Videocon is believed to be talking to three French insurance majors for a possible joint venture in the 74:26 ratio.

A final decision on a likely partner is likely to be announced, before it files its application with the Insurance Regulatory Authority of India (IRDA). Videcon plans to hold the majority stake and is reportedly willing to bring in the minimum Rs 74 crore investment needed for the venture.
Back to News Review index page 

Hindustan Zinc completes smelter expansion
New Delhi: Hindustan Zinc Ltd.(HZL) has announced on Thursday completion of its zinc smelter expansion programmes at Debari and Vizag. The expansion would add 20,000 tonnes of capacity to HZL's production facilities.

The public sector giant recorded an all time high turnover of Rs 1,183 crore for the period April to December 2000, against a target of Rs 1,112 crore. The company also achieved a net profit of Rs 201 crore for the same period. It produced 107,513 tonnes of zinc and 25,548 tonnes of lead in the same period. Lead-zinc ore and concentrate production during the third quarter of the year exceeded the target by 108 and 107 per cent respectively.
Back to News Review index page 

Crompton Greaves on a cost cutting drive
New Delhi: Crompton Greaves India has announced a major cost cutting drive, which will see pruning of its manpower by 2,500 to bring down wage costs by up to 30 per cent. The company's existing voluntary retirement scheme is expected to reduce manpower to about 5,000 employees by 2001-end.

The company also plans to further reduce working capital costs as part of its ongoing restructuring exercise. The company is focussing on a major cost realignment to achieve profitability over the next two years. Crompton Greaves posted Rs 70 crore net loss for the third quarter this fiscal and skipped dividend payment for the first time.
Back to News Review index page 

Godfrey Philips not in the race for VST
New Delhi: Godfrey Philip India (GPI), the country's second-largest cigarette company has no plans to join the race for acquisition of VST Industries. KK Modi, chairman, GPI has said that though VST has reasonably good brands, GPI was not interested.

On 13 February, Mumbai-based Brightstar Investments had announced an open sale offer for 20 per cent stake in Hyderabad-based VST Industries, after it acquired 14.97 per cent of its equity capital. Brightstar, a broking outfit, is expected to exit in favour of one of the domestic tobacco companies, as guidelines on an overseas player making a counter offer are not clear.

ITC Ltd. sources have however, indicated that their company would make a bid, if a foreign company makes a counter offer for VST Industries. With the proposed ban on advertisements and sponsorship by tobacco companies, industry sources believe VST with its Charminar & Charms brands is a potential good buy for increasing marketshare.
Back to News Review index page 

United Airlines flights to India from April
Mumbai: United Airlines is resuming flights to India from April 1. Two flights will be operated daily to Delhi. Flights will resume from Washington and reach Delhi via London and then to Hong Kong and Los Angeles, before completing a full circle and re-touching Washington. Both the flights will leave Washington in the opposite directions, but are scheduled to touch Delhi at the same time.

The airlines had earlier suspended its flights in 1999, as it was not making profits. However, the airline is now optimistic that it will be able to fare well this time, with a considerable increase in the air traffic to India. The air traffic to and from India has increased by six per cent in the last year.

At present, United Airlines operates five flights to Frankfurt out of Mumbai and three flights weekly out of Chennai through a sharing arrangement with Lufthansa. The airlines also plans to add Mumbai and Chennai to its destinations in the next two to three years.
Back to News Review index page 

Wockhardt terminates marketing ties with Sidmak
Mumbai: Wockhardt Ltd. has terminated its three-year old marketing alliance with Sidmak Laboratories, one of the top ten generic pharma companies in the US, dues to poor sales performance.

Under the agreement, Sidmak was to market 15 new drug delivery systems (NDDS) and generic products developed by Wockhardt with critical R&D (research and development) inputs from Sidmak. However, Wockhardt developed only two NDDS -- Ranitidine and Enalaprill Maleate -- against the proposed 15. Besides, Sidmak too had also started deleting products from the list of 15 formulations, which it was to market in the US. The profit margins of the two NDDS, which Sidmak have been marketing for the last three years have not even touched $1 million.

Wockhardt will now be looking for new partners to market these 15 products and some new technology-driven products that it plans to launch in the western market soon. The company is in talks with several others for a new alliance.
Back to News Review index page 

Orchid Pharma to invest Rs 46 cr for biotech foray
Chennai: Orchid Chemicals and Pharmaceuticals Ltd., the Chennai-based bulk drug manufacturer, has earmarked Rs 46 crore for entering the biotechnology sector by way of tie-ups and joint ventures. The company has also set up a drug design centre for the development of new molecules and is gearing up to enter the burgeoning area of contract research for multi-national drug majors.

Mr. K Raghavendra Rao, managing director, Orchid Chemicals has said that his company has chalked out a plan to initially focussing on two upcoming areas of bio-enzymes and bio-transformation. Bio-enzymes and bio-transformation would help to spruce up the yield of the formulations, close to theoretical levels by cutting the many steps of chemical transformation.

The company is now in an advanced stage of talks with a slew of drug manufacturers at home and abroad for possible tie-ups. The company has raised a total $30 million from IFCI recently by way of issuing foreign currency convertible bonds. The company is also planning to take up the lucrative research contract for multinational drug majors.
Back to News Review index page