Indian Rayon to buy controlling stake in PSI Data
Mumbai-- Indian Rayon, the AV Birla group company is planning to acquire a 50.35 per cent controlling stake in PSI Data Systems from Groupe Bull, France, for Rs 71 crore.
Group chairman Kumar Mangalam Birla said, "PSI fits the growth plan of the group to expand the presence in the information technology business and will enhance India Rayon’s shareholders value.’’
Indian Rayon would make an open offer to acquire 20 per cent equity from public shareholders at Rs 186.80 per share, the same price at which it had picked up the stake from the French it group, he said.
With this acquisition, the Aditya Birla group will have two IT companies in its fold, the other one being Birla Technologies.
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Zee considers primetime slots on DD Metro
New Delhi—When Prasar Bharti invited bids last week for prime time slots on Doordarhan’s DD Metro channel, Zee Network showed its keenness in bidding for the slots.

Zee's renewed interest is at a time when the other contenders -- HFCL-Nine Broadcasting, STAR and Sony -- have shown at best a tepid response to government's efforts to put life back into the bidding process.
When contacted, senior vice-president (marketing) for Zee Network, Partho Sinha, said, "We are reconsidering bidding for the DD Metro slots. The initial bid terms did not make any business sense to us and, thus, we had refrained from expressing interest formally."
Sinha said Zee would place a bid for only the 7-9 pm slot, and was confident of turning up a winner since it had a vast variety of content to leverage from.
Late last month, Prasar Bharati had invited bids for the primetime band of 7-10 PM and the 10 PM-3 AM slot on DD Metro for a period of three years.
Dividing the time band into one-hour slots, it laid the floor price of Rs 22.50 crore, Rs 32.50 crore, Rs 42.50 crore and Rs 17.50 crore for the four hourly slots between 7-11 pm.
But after its earlier call got no bidders, Prasar Bharati invited fresh bids for the 7-11 pm slots on DD Metro, this time without a floor price.
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India could become a major innovation center with Media Lab Asia
New Delhi—Media Lab Asia, the Indian government's Rs 5,130-crore IT research project, launched in Mumbai on May 31, will enable India to enter the information technology applications field in a big way and become an international hub for IT innovation, according to the National Association of Software and Service Companies (Nasscom).

Phiroz Vandrevala, chairman, Nasscom, said that Media Lab Asia project had come at a time when the Indian IT industry required focusing on invention and innovation to meet challenges in healthcare, education and enterprise in the country.
India's Media Lab, in collaboration with Massachusetts Institute of Technology, is the second outside the US and third in the world.
The lab will have a chain of regional laboratories, linked together to "facilitate invention, refinement and deployment of innovation that benefit the masses."
The project will focus on next generation research and development technology in the entertainment sector on one hand and in rural applications for sustainable rural development on the other hand.
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A-I sees profits in fiscal 2001-02
New Delhi—Air-India is hoping to earn profits for the first time in six years. The airline last made a profit in 1994-95 and since then has been in the red. Its net loss in 2000-01 was put at Rs 28 crore.
Its earnings could be more than Rs 20 crore in fiscal year ending March 2002.
A spokesman said Air-India had been able to make the turnaround because of increasing revenue and better utilisation of fleet.
"We are estimating profits due to the expansion of our fleet that will lead to increased revenue through better customer services," a spokesman said. "Six more aircraft are being leased to add to the existing fleet."
The government's refusal to buy more aircraft because of a cash crunch has forced the airline to resort to bilateral agreements with other carriers to cater to increasing passenger demand in India.
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Videocon, Sterlite may be out of divestment race
New Delhi-- Videocon may not be able to bid for for the government stake in Indian Airlines and Sterlite Industries Ltd, which was looking for a stake in Hindustan Zinc Ltd may be out as well.
This is because norms for disqualification of bidders finalised by the department of disinvestment specify that in the case of bidders, the government will only bar specific companies named in Securities and Exchanges Board of India, Sebi, orders and not sister companies of the group.
However, the norms are still to be cleared by the Cabinet Committee on disinvestment. The law ministry has opposed the norms for disqualification of bidders set by the DoD, as it feels that they are too wide ranging.
The DoD has listed five cases in which companies should be disqualified from bidding which include cases of fraud, dishonest behaviour and price rigging. Specifically, the DoD has recommended that any company against whom Sebi or the Reserve Bank of India has passed strictures should be barred from the process.
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Octavia to be on Indian roads by September
New Delhi—Skoda Auto of Czechoslovakia, has set its sights on the premier market segment in India and plans to launch its Octavia model in September.
With a price range of Rs 11 lakh the Octavia is placed between General Motors' Opel Astra and Daimler-Chrysler's Mercedes C-class.
Skoda will initially roll out the Octavia diesel version, followed by a 1,984 cc petrol version by the year-end from its wholly owned company in Aurangabad.
Skoda is part of the Volkswagon group, which will invest $50 million in Skoda's Indian subsidiary. Skoda had held back further investment plans after setting up its greenfield project in Aurangabad with investments of over $6 million, as it was awaiting Indian government clarification on the automobile policy with regards duty structures.
Skoda proposes to divest 8-10 percent equity in the Indian subsidiary to financial institutions over the next two to four years.
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Activa of Honda to be exported to Nepal, Mexico, Turkey
Hyderabad—Honda Motorcycle & Scooter India, a 100 per cent subsidiary of the Honda Motor Company, Japan, plans to export its mid-size scooter model, Honda Activa to countries like Mexico, Turkey, Nepal and Bangladesh in fiscal 2001-02.
The company is introducing its first model 102 cc Honda Activa scooter in India on July 1.
At a roadshow of Honda Activa here, HMSI’s director for sales and marketing, Kojiro Iguchi said the company, with a production capacity of one lakh units per year, expects to sell 50,000 scooters in the first year followed by 1.20 lakh and 2.50 lakh vehicles in the second and third year, respectively.
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Tea, coffee businesses of Tatas may eventually merge
Kolkata--Tata Tea and Tata Coffee have begun to integrate their marketing networks, and it is expected that eventually the two companies will be merged as well.
P Siganporia, deputy-managing director, Tata Tea, said the company now has a national marketing organization and the sales, distribution and branding of Tata Coffee is now vested with Tata Tea. But on the issue of a merger of the two, he said that this could be an option for the company in future.
The integration of the marketing networks of the two companies is part of Tata Tea's strategy to increase its market share and make further penetration with the existing own brands and those of Tata Coffee.
To master a bigger share in the depleting market, the tea major is all set to start a massive brand building exercise this year. The company is also planning to launch new brands.
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Sundaram Finance records increase in net
Chennai—Despite tough market conditions and pressure on margins, Sundaram Finance has posted an impressive 37 per cent jump in net profit at Rs 70.54 crore in the year ended March 31, 2001 over Rs 51.58 crores in the previous year.
The company also pushed its gross disbursements by 18 per cent to Rs 1141 crore (Rs 969 crore).
Of this, hire purchase disbursement spurted by 21 per cent to Rs 1034 crore (Rs 857 crore) with commercial vehicles accounting for 50 per cent share and passenger cars and utility vehicles 40 per cent.
Similarly, in cars, when the industry sales dropped by eight per cent, SF recorded a jump of 20 per cent.
Gross income touched Rs 532.55 crore ( Rs 461.13 crore) and the increase is mainly due to the new accounting standard issued by ICAI in respect of leases which includes HP.
SF’s own funds had crossed Rs 500 crore mark at Rs 501.33 crore ( Rs 429.01 crore).
The board has proposed to treat the 60 per cent interim dividend declared earlier as final payment. In the previous year, it paid 60 per cent dividend.
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Eli Lilly sees way ahead in clinical research in India
New Delhi--Eli Lilly the US-based pharma major says that clinical research would be the core thrust area of its Indian operations. The company has invested $20.30 million in the country and would conduct clinical trials for its upcoming drugs in therapeutic areas like oncology, diabetes and cardiovascular among others, a company statement said here.
The company was recently received Foreign Investment Promotion Board's approval for acquiring 50 per cent stake of Ranbaxy Laboratories in their joint venture Eli Lilly Ranbaxy.
Eli Lilly Ranbaxy was established as a 50:50 JV between the Indian partner and Eli Lilly's Netherlands subsidiary Eli Lilly Netherlands in 1993. (PTI)
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Aditya Birla group; exit from VSNL divestment race
Mumbai--The Aditya Birla group has decided to withdraw from Videsh Sanchar Nigam’s (VSNL) privatisation process. The company had earlier submitted an expression of interest for the state run telecom major.
Group officials said that VSNL did not quite "fit into the group’s plans" for telecom business and also that it was an "unattractive proposition" in the wake of the private sector competition that could adversely affect the long-term future of VSNL.
In view of the government’s decision to allow private sector companies into international long distance telephony and the continuous decline in international voice tariffs there were major concerns in industry circles and in addition voice over Internet protocol (VoIP), when allowed, could adversely impact VSNL’s revenues.
The Birlas are among the six domestic business houses, which had bid for VSNL. The others include: the Tatas, Reliance group, Bharti-Singtel, BPL-Sterling and Videocon. Not even one international telecom major has put in an expression of interest for VSNL because the cloud over the long-term future of the international long distance telephony business remains.
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United Technologies to use India as outsourcing destination
Mumbai--United Technologies Corporation (UTC) is another multinational planning to outsource its global software requirements to India. The group has tied up with Infotech Enterprises, a Hyderabad-based IT firm, for outsourcing low and mid-end IT and engineering requirements for its group companies.
About 255 employees at Infotech Enterprises are currently working on the UTC project. This will have to be scaled up to 400 employees by the end of this year.

UTC’s initiatives come at a stage when leading software companies in India have been adversely affected by the IT slowdown in the US, the leading market for the Indian software industry and are, therefore, looking at downsizing their work force. The group is planning to strengthen its presence in the Asia-Pacific region, especially in India and China, as part of its global strategy.
Companies, which are part of the $26.6 bn group are Pratt & Whitney, the aero-engine manufacturing major, Carrier Aircon, the air-conditioning manufacturer and Otis the elevators company.
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HDFC to sustain growth despite intense competition
Mumbai— India’s largest home-loan lending institution, the Housing Development Finance Corporation, (HDFC) will expand new lending by 25-30 per cent despite growing competition with rivals, managing director Keki M Mistry said on Saturday.
He said that HDFC would launch new products and lay stress on improving the services it provides. He declined to describe the new products.
Over the past two years, HDFC has already moved to offer a wider range of borrowing options to defend its dominance in the home loan market.
From offering just 15-year fixed-rate loans, it’s begun offering shorter maturity loans and floating-rate 20-year loans. Yet analysts still express concern about the competition eating into HDFC’s current 60 per cent share of India’s home loan market.
Its main competitors in the housing sector are the State Bank of India and ICICI.
SBI has many more branches and last week said it aimed to increase not just its housing loan growth rate, but also its entire housing loan portfolio by 60 per cent this year.
SBI has more than 9,000 branches, HDFC just 87 branches.
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SAIL's Rs 21-cr order under CVC scrutiny
New Delhi—Steel Authority of India's (SAIL) order for conveyor belts worth about Rs 21 crore has come under the scrutiny of the Central Vigilance Commission. This is on the grounds that the company Phoneix Yule, was given preference despite its bid being higher than others.
On requests from certain sections CVC asked for details of SAIL's order in which Phoneix Yule has been undue preference flouting government order on purchase preference, CVC guidelines on price negotiations and not giving price preferences to small-scale industries.
SAIL officials said, "Everything has been done in a very transparent manner, and the company has followed established procedures."
Industry sources said that the original price quoted by Phoneix Yule was higher than 10 per cent concession over the lowest bid. In three of the groups, for which bids were invited, the lowest price was Rs 4.27 crore, Rs 6.72 crore and Rs 10.04 crore.
Phoneix Yule's quotations of Rs 4.87 crore, Rs 7.46 crore and Rs 11.28 crore were higher than the 10 per cent purchase preference.
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Final review of GE-Honeywell underway by EU
Brussels—Anti –trust officials from the 15 European Union nations have taken up the draft decision of merger regulators on General Electric's proposed $41 billion purchase of Honeywell International.
The advisory committee, comprising representatives from national competition agencies, reviews conclusions made by the European Commission, the EU's executive body, on big merger deals and makes recommendations.
EU officials say that the Commission is unlikely to change its position when the merger comes up for a vote, expected on July 3.
Enforcement of antitrust law is one of the few areas in the EU where the Commission is empowered to act on its own.
Its decisions can be challenged in court, as Worldcom did after the EU rejected its purchase of Sprint, but companies usually abandon their deal long before any court ruling can be made.
The EU's hard line on the GE-Honeywell tie-up, which won conditional clearance in the United States last month, has provoked criticism from the Bush administration and members of Congress.

US Sen Jay Rockefeller last week sent a letter to the Commission urging a "fair" decision and warning that a rejection "could have a chilling effect on future trans-Atlantic aviation and aerospace cooperation."
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