We have high hopes for India: CLSA
CLSA, majority owned by Crédit Agricole (France), is one of Asia Pacific's most highly rated independent equity brokers and financial-services groups, focused on providing broking, investment banking and asset management to global corporates.CLSA Capital Partners is the firm’s alternative asset-management arm, comprising funds with more than $2.5 bn under management.
In an exclusive interview, ET NOW caught up with Richard Pyvis, Executive Chairman, CLSA Capital Partners on the East Asian models of growth, the 'middle class' purchase potential and other economic pointers in the Apac region.
Let us talk about demographics first. Here is how we see it here from perch here. Japan is old with China, of course the key demographic question is whether it is going to become rich before it gets old and with India, we are seeing an enormous bulge in the supply of young workers without nearly enough capital available to absorb them all, so are you seeing the demographic picture any differently from this?
Richard Pyvis : Yes, demographics is a really big issue affecting Asia. We have got one about a third of the world population sitting here in the region from India or out in the west through the Japan in the Northeast and the demographic across that region is quite different. If I start with Japan, Japan is a really interesting story because you have got a demographic profile shape like a champagne glass with very few younger workers coming into the available workforce. Interesting thing there of course is that with that lack of supply, do you need to have positive growth in Japan. Perhaps there is an argument that says that negative growth is a good thing or is a sensible thing.
Alternately, you have got to import labour. Then we zip over to China and China has a demographic list or little bit like that and I have seen some numbers that say that by about 2015-2018, we would start to get a labour shortage in China on the assumption that capital and technology remain pretty much as they are in their current application in China. That is likely to change and so any forecast on the Chinese demographic and its impact on its productive capability is probably going to change over the course of the next 5-10 years.
Then we will wonder how apart from the fact that you guys are way too good at cricket which causes me a lot of grief from time to time coming from Australia, you have got a fantastic demographic with an enormous supply of youth coming into the market and your challenge is really to enable the entry of that used into the labour market and to make sure that labour force is well educated and skilled as it can be so that India gets the greatest productivity out of that labour availability.
Coming to middle class theme that you have identified, where do you think that theme is playing out to its fullest potential?
Richard Pyvis : I could not help overhearing your earlier comments on FMCG sector in India and the same comments could probably apply right across the region, particularly in the younger population countries and in particular India and Indonesia. So that is certainly a sector that is going to benefit from increases in per capita GDP, increases in disposable income, greater propensity for consumption. So we are going to see that sector in particular benefit from this emerging middle class that is occurring right before our eyes right across the region.
Also See 1500th Post to Know About CLSA.
Src: Economictimes.indiatimes.com
23 June 2010
Heard on st: Supreme Infra, textile stocks
Heard on st: Supreme Infra, textile stocks
MFs, HNIs lap up textile stocks on rally hopes
SOME mutual funds and high net worth investors (HNIs) are believed to be accumulating shares of textile companies, including Alok Industries. The stock rose 4.5% to Rs 20.40 in a weak market. Analysts expect shares of textile firms to firm up further supported by China’s pledge to let the yuan appreciate.
A stronger yuan would make China’s textile exports costlier and dent its pricing advantage over its competitors. But some brokers feel investors should use recent upsides to book profits, as China is unlikely to allow any major appreciation in its currency.
PMS heads of fund houses on the move
THE portfolio management services (PMS) divisions of select mutual funds are seeing changes at the top. Shahzad Madon, a senior official at ICICI Prudential Asset Management, is believed to have put in his papers. But it’s not clear where Madon, who was in charge of real estate fund and the PMS business at ICICI Prudential AMC, is headed.
Madon could not be reached for comment. Meanwhile, Mohit Mirchandani, who quit as head of equity at Taurus Mutual Fund recently, is learnt to have joined Religare PMS. It is also rumoured that Ashish Ranade, a fund manager at the PMS unit of UTI Mutual Fund, is joining the mutual fund joint venture between state-owned Union Bank of India and Belgium’s KBC Group.
Supreme Infra gains 35% in a month on FIs’ support
SHARES of Mumbai-based Supreme Infrastructure have gained close to 35% a month, driven by interest from some institutional investors and HNIs. The buzz is that the company is expected to bag some major orders shortly. It recently submitted its request for quotation (RFQ) for projects worth Rs 2,000 crore, which includes two road projects in Maharashtra and other projects in northern and central India.
The company’s current order book is about Rs 1,500 crore. The bids are expected to open in the next few weeks. A senior company official declined to comment. The stock rose 4% to Rs 260 on Tuesday. The company has recently issued fresh shares to fund part of its equity requirement towards one of its BOT projects, which it bagged recently.
Contributed by Harish Rao, Nishanth Vasudevan & Apurv Gupta
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STOCK ANALYSIS: BEML
STOCK ANALYSIS: Larsen & Toubro
Analysts' corner
Hindalco: A new perspective
Src: ET and DP blog and etc
SOME mutual funds and high net worth investors (HNIs) are believed to be accumulating shares of textile companies, including Alok Industries. The stock rose 4.5% to Rs 20.40 in a weak market. Analysts expect shares of textile firms to firm up further supported by China’s pledge to let the yuan appreciate.
A stronger yuan would make China’s textile exports costlier and dent its pricing advantage over its competitors. But some brokers feel investors should use recent upsides to book profits, as China is unlikely to allow any major appreciation in its currency.
PMS heads of fund houses on the move
THE portfolio management services (PMS) divisions of select mutual funds are seeing changes at the top. Shahzad Madon, a senior official at ICICI Prudential Asset Management, is believed to have put in his papers. But it’s not clear where Madon, who was in charge of real estate fund and the PMS business at ICICI Prudential AMC, is headed.
Madon could not be reached for comment. Meanwhile, Mohit Mirchandani, who quit as head of equity at Taurus Mutual Fund recently, is learnt to have joined Religare PMS. It is also rumoured that Ashish Ranade, a fund manager at the PMS unit of UTI Mutual Fund, is joining the mutual fund joint venture between state-owned Union Bank of India and Belgium’s KBC Group.
Supreme Infra gains 35% in a month on FIs’ support
SHARES of Mumbai-based Supreme Infrastructure have gained close to 35% a month, driven by interest from some institutional investors and HNIs. The buzz is that the company is expected to bag some major orders shortly. It recently submitted its request for quotation (RFQ) for projects worth Rs 2,000 crore, which includes two road projects in Maharashtra and other projects in northern and central India.
The company’s current order book is about Rs 1,500 crore. The bids are expected to open in the next few weeks. A senior company official declined to comment. The stock rose 4% to Rs 260 on Tuesday. The company has recently issued fresh shares to fund part of its equity requirement towards one of its BOT projects, which it bagged recently.
Contributed by Harish Rao, Nishanth Vasudevan & Apurv Gupta
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STOCK ANALYSIS: BEML
STOCK ANALYSIS: Larsen & Toubro
Analysts' corner
Hindalco: A new perspective
JBF Industries
Daily Technicals - June 23 2010
Oil Marketing Companies
Sun Pharma - small positives
DLF - reducing debt, selling assets , CESC
Dish TV - investing for the future
Technical Calls - June 23 2010
Mphasis
Src: ET and DP blog and etc
22 June 2010
Derivative and Equity Calls
21 Jun 2010 |
21 Jun 2010 |
Derivative calls: Tata Power, Ambuja Cement, Apollo Tyres
Technical calls: SKF India, IDFC
Jhunjhunwala seen buying VIP Inds shares
High net worth investor Rakesh Jhunjhunwala is mopping up shares of VIP Industries. Jhunjhunwala, who is also one of the major shareholders of VIP Inds, bought a sizeable quantity of the company’s shares on Monday. VIP shares jumped 8.2% to close at Rs 297.50 after scaling a new high of Rs 312.4 during intra-day trading on the BSE. The counter attracted significantly higher volumes of 22.8 lakh shares, compared to two-week average of 3.9 lakh shares. The acquisition of fresh shares led to an increase in Jhunjhunwala’s stake from 4.5% as on March 31, ’10 to 5.8% of the company’s equity.
Top i-bankers in demand despite weak market
The market has been largely tepid, of late. And fund-raising deals have slowed, but that has hardly dented demand for investment bankers. In the past many months, many top deal-makers have changed jobs. The latest buzz is that Sunil Sanghai of Goldman Sachs has quit. He is believed to be joining HSBC as managing director, global banking-corporate and investment banking. Tarun Kataria, who has been appointed by Religare Capital Markets as CEO, was the head of HSBC’s global banking and markets. Goldman Sachs’s India head Brooks Entwistle had roped in Sanghai when he was building the US-based financial services player’s Mumbai team.
Carrefour may get hold of Pantaloon’s ‘Bazaar’
Speculation that Pantaloon Retail is close to selling a large stake to French retailer Carrefour refuses to die. If market grapevine is to be believed, Carrefour will bring Pantaloon’s retail segments like ‘Big Bazaar’ and ‘Food Bazaar’ under its fold. While officials at Pantaloon denied any such development, analysts tracking the company are not discounting a “surprise announcement” over the next few weeks. Shares of Pantaloon ended marginally higher at Rs 415.20 on the BSE on Monday.
(Contributed by Vijay Gurav, Reena Zachariah & Shailesh Menon)
High net worth investor Rakesh Jhunjhunwala is mopping up shares of VIP Industries. Jhunjhunwala, who is also one of the major shareholders of VIP Inds, bought a sizeable quantity of the company’s shares on Monday. VIP shares jumped 8.2% to close at Rs 297.50 after scaling a new high of Rs 312.4 during intra-day trading on the BSE. The counter attracted significantly higher volumes of 22.8 lakh shares, compared to two-week average of 3.9 lakh shares. The acquisition of fresh shares led to an increase in Jhunjhunwala’s stake from 4.5% as on March 31, ’10 to 5.8% of the company’s equity.
Top i-bankers in demand despite weak market
The market has been largely tepid, of late. And fund-raising deals have slowed, but that has hardly dented demand for investment bankers. In the past many months, many top deal-makers have changed jobs. The latest buzz is that Sunil Sanghai of Goldman Sachs has quit. He is believed to be joining HSBC as managing director, global banking-corporate and investment banking. Tarun Kataria, who has been appointed by Religare Capital Markets as CEO, was the head of HSBC’s global banking and markets. Goldman Sachs’s India head Brooks Entwistle had roped in Sanghai when he was building the US-based financial services player’s Mumbai team.
Carrefour may get hold of Pantaloon’s ‘Bazaar’
Speculation that Pantaloon Retail is close to selling a large stake to French retailer Carrefour refuses to die. If market grapevine is to be believed, Carrefour will bring Pantaloon’s retail segments like ‘Big Bazaar’ and ‘Food Bazaar’ under its fold. While officials at Pantaloon denied any such development, analysts tracking the company are not discounting a “surprise announcement” over the next few weeks. Shares of Pantaloon ended marginally higher at Rs 415.20 on the BSE on Monday.
(Contributed by Vijay Gurav, Reena Zachariah & Shailesh Menon)
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21 June 2010
Check out India's Top 10 great companies to work for
Check out India's Top 10 great companies to work for
Click on next button to find out the top 26 to 50 companies to work for 2010.
More @ List of top 50 companies to work for
ET Bureau
As before, the 2010 edition of "India's Best Companies To Work For" presents profiles the best. Our writers have spent time inside these organisations, interviewed CEOs, HR heads and employees to gauge what it takes to be the best company to work for.
The 2010 study reports on how companies have nurtured their human capital in the face of the downturn, while taking some bold initiatives to maintain the topline and bottomline growth.
There are companies out there which believe in the age-old 'home-away-from-home' principle and go all out to create a 'family' of workers, while others maintain a high fun quotient around their core activity.
Check out the top ten India's best companies to work for 2010:
Location: Bangalore
Profile: Online Search, Online Advertising & Online Applications
Number of employees: 1,259
Founded in India: 1998
Gender Ratio (F/M): 1:0.99
Voluntary turnover: 30%
It was an accidental misspelling that got Google its name but that's where the accidents end at the Google headquarters in RMZ Infinity, Bangalore. "Any good place to work is no accident," says Manoj Varghese, the APAC HR director. "And it's not just about beanbags."
Googlers work hard at making their workplace rock. At a time when break-out spots and recreational zones have started to become almost de rigueur, Googlers have taken it one step further: to the washrooms! (Read Full Story)
MOre @ Check out India's Top 10 great companies to work for
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List of top 50 companies to work for
The best workplaces have redefined their agenda by improving employee positive perceptions about work life balance by a phenomenal 18% in the last five years. 88% of employees of the Top 25 best workplaces have agreed with the statement, “I am able to take time off from work when I think it’s necessary.” Click on the company names to find out why they love to work with them:
| Rank | Name of the Company | Location | Number of Employees | Gender Ratio (F:M) | Voluntary Turnover |
| 1 | Bangalore | 1,259 | 1:0.99 | 30% | |
| 2 | Gurgaon | 674 | 1:2.55 | 23.89% | |
| 3 | Bangalore | 2,430 | 1:3.99 | 4.4% | |
| 4 | Mumbai | 2,433 | 1:9.01 | 27.37% | |
| 5 | Bangalore | 1,042 | 1:4.51 | 5.95 | |
| 6 | Gurgaon | 5,200 | 1:1.33 | 15.00% | |
| 7 | New Delhi | 24,708 | 1:8.11 | 0.12% | |
| 8 | Chennai | 419 | 1:3.6 | 0.48% | |
| 9 | Chennai | 1,612 | 1:1.41 | 23.45% | |
| 10 | Mumbai | 108 | 1:5.75 | 13.89% | |
| 11 | Gurgaon | 399 | 1:5.23 | 48.87% | |
| 12 | Mumbai | 241 | 1:6.3 | 9.96% | |
| 13 | Mumbai | 13,009 | 1:6.58 | 11.55% | |
| 14 | Mumbai | 1,314 | 1:30.29 | 6.24% | |
| 15 | Gurgaon | 1,128 | 1:13.28 | 8.69% | |
| 16 | Gurgaon | 5,040 | 1:1.86 | 12% | |
| 17 | Chennai | 2,263 | 1.21 | 8.66% | |
| 18 | Delhi | 427 | 1:13.72 | 12.88% | |
| 19 | Bangalore | 4,329 | 1:3.49 | 4.87% | |
| 20 | Mumbai | 25,810 | 1:2.27 | NA | |
| 21 | Mumbai | 1,073 | 1:6.5 | 4.38% | |
| 22 | Mumbai | 514 | 1:4.3 | 12.65% | |
| 23 | Mumbai | 6,461 | 1:4.04 | 18.77% | |
| 24 | Noida | 5,650 | 1:9.58 | 53.35% | |
| 25 | Mumbai | 325 | 1:3.28 | 6.46% |
Click on next button to find out the top 26 to 50 companies to work for 2010.
More @ List of top 50 companies to work for
Src: Economictimes.indiatimes.com
Will Nifty Hit a New Fresh 52 Week High???
21 Jun 2010, 0454 hrs IST, Deepak Mohoni
21 Jun 2010, 0454 hrs IST
21 Jun 2010, 0454 hrs IST, Parul Bhatnagar
21 Jun 2010, 0454 hrs IST, Amrit Mathur
21 Jun 2010, 0454 hrs IST, Shikha Sharma
21 Jun 2010, 0454 hrs IST, Ranjit Shinde
21 Jun 2010, 0454 hrs IST, Anup Bagchi
21 Jun 2010, 0454 hrs IST, Karan Sehgal
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Technicals - June 21 2010
Aban Offshore, Mindtree - big win
Lanco Infratech - technicals
Tulip Telecom
Reliance Industries
India Autos, Gas, Pharma
Weekly Technicals, Stocks - June 21 2010
Weekly Technical Calls - June 21 2010
Weekly Technical Calls - June 21 2010
GPIL
Exide Industries - buoyancy in the industry
Src: ET and DP blog
20 June 2010
Market and Stock Views
TECHNICAL ANALYSIS: Index Outlook: Bear-squeeze can extend the rally
The Sensex recorded a strong 500-points gain last week. But this move went almost unnoticed since market participants were busy tracking the two Reliance factions and speculating over their next move. The Ambani charisma was on display yet ...
STOCKS: Aurobindo Pharma: Buy
Long-term investments can be considered in the stock of Aurobindo Pharma, a leading API (active pharmaceutical ingredient) and ...
Reliance Industries (Rs 1,058.1): For more than three months, the stock has been moving in a narrow band between Rs 960-1,140. It is unlikely to break this band in the near term. Only a move away from this zone will make a clear trend for ...
STOCK MARKETS: Heard in the studio
The folks at the Studio were on their toes the past week too. Here's some of the chatter we caugh
Wkly Tech Analysis: Further strength above 5300
The markets moved from strength to strength for most part of the week before witnessing some profit-taking on Friday. The fact that the Sensex was able to cross 17,300 with ease signals more hope for the bulls. The 17,300-level can now be watched as a support for the current upmove. On the upside, the index is likely to target 18,000-18,300 in the coming sessions.
The Sensex recorded a strong 500-points gain last week. But this move went almost unnoticed since market participants were busy tracking the two Reliance factions and speculating over their next move. The Ambani charisma was on display yet ...
STOCKS: Aurobindo Pharma: Buy
Long-term investments can be considered in the stock of Aurobindo Pharma, a leading API (active pharmaceutical ingredient) and ...
STOCKS: GAIL (India): Buy
Investors with a high-risk appetite can consider buying the stock of GAIL (India), the country's predominant natural gas transmission and ...
STOCKS: HDIL: Buy
The renewed fortunes of the Transferable Development Rights (TDR) market, coupled with HDIL's steady progress in its slum rehabilitation and residential projects add impetus to the company's ...
STOCKS: Pratibha Industries: Buy
Investors with a penchant for risk and a medium-term perspective can buy the stock of construction and infrastructure company Pratibha Industries. At Rs 380, the stock trades at 11.4 times per share earnings for FY-10. Valuations are at ...
MUTUAL FUNDS: HDFC Growth: Invest
Investors can buy the units of HDFC Growth Fund, given the fund's track record in delivering steady returns over the long term. The fund has consistently outperformed its benchmark, the Sensex, over one-, three- and ...
MUTUAL FUNDS: ICICI Pru Child Care Study Plan: Invest
Conservative investors who intend to build a sufficient corpus for their child's education can continue to hold on to ICICI Prudential Child Care-Study plan, an open-ended hybrid fund with a maximum allocation of 25 per cent in equity. The ...
TECHNICAL ANALYSIS: Query Corner: MTNL in long-term downtrend
I bought MIC Electronics at Rs 46. Please advise short-, medium- and long-term prospects of the stock. R. Chandran, Sunil K. Jha, Suresh, ...
TECHNICAL ANALYSIS: Pivotals: Reliance Industries (Rs 1,055.2)
RIL edged higher ahead of its annual general meeting to record the intra-week peak of Rs 1,089.9. But it declined thereafter to close the session 3 per cent lower from its intra-day peak. The stock has key short-term resistance at Rs 1,096. ...
TECHNICAL ANALYSIS: Sizzling stocks: RNRL (Rs 62.7)
All eyes in the market were riveted on RNRL last week as the stock zoomed to the high of Rs 70.2. Expectation of an announcement in the RIL's annual general meeting about RIL buying a stake in RNRL at a high price was the ostensible reason ...
Reliance Industries (Rs 1,058.1): For more than three months, the stock has been moving in a narrow band between Rs 960-1,140. It is unlikely to break this band in the near term. Only a move away from this zone will make a clear trend for ...
STOCK MARKETS: Heard in the studio
The folks at the Studio were on their toes the past week too. Here's some of the chatter we caugh
Irda wins Ulip battle
Capital gains tax: There's still hopeWkly Tech Analysis: Further strength above 5300
The markets moved from strength to strength for most part of the week before witnessing some profit-taking on Friday. The fact that the Sensex was able to cross 17,300 with ease signals more hope for the bulls. The 17,300-level can now be watched as a support for the current upmove. On the upside, the index is likely to target 18,000-18,300 in the coming sessions.This week, the Sensex finished with a gain of 506 points to 17,571. DLF led the gainers, up nearly 8 per cent at Rs 282. Larsen & Toubro, Reliance Communications and Sterlite rallied 7 per cent each. Infosys, Jindal Steel, ITC, Jaiprakash Associates, Tata Motors and HDFC were the other major gainers. Bharti Airtel, however, shed 3.5 per cent to Rs 265.
Next week, the Sensex is likely to face resistance around 17,800-17,870-17,945. On the downside, the index is likely to seek support around 17,340-17,270-17,195. Daily charts indicate near support around 17,480 (20-day daily moving average) and far off support around 17,021 on the weekly charts.
The NSE Nifty moved in a range of 182 points. From a low of 5,120, the index rallied to a high of 5,302, and finally settled with a gain of 143 points at 5,263.
Given the recovery in the world markets and renewed optimism among global investors, the bias continues to be positive. However, one needs to watch out for negative surprises in the form of either a surprise RBI rate action or poor monsoon for a change in bias.
The Nifty has been treading higher with support along its short-term (20-days DMA, or daily moving average), which is currently at 5,238. If the index breaks it, it could probably test its next significant support around 5,183. On the upside, the Nifty needs to close above the 5,300-mark for further strength.
From a medium-term perspective, the Nifty has considerable support around 5,100, and the upside target could be close to 5,400.
Profit Track
18 June 2010
Oriental Carbon and Chemicals:
DOCCL has reported excellent results for year ended March 2010 wherein its PAT has zoomed by nearly 300%. EPS for Q4 alone is Rs 10. Stock is trading at just 4.62XFy10 EPS which is extremely low considering that OCCL is operating in a seller's market.
Further, OCCL has started implementation of new factory in SEZ in Gujarat which should be completed in 12 months. OCCL may achieve EPS of Rs 36-38 in 2010-11 and EPS of Rs 42-44 in 2011-12. Although, share price has touched a new high, still fundamentally OCCL is underpriced considering that company will continue to do well due to buoyant demand from tyre industry, expansion underway and payment of 3 dividends in 2009-10. Book Value is Rs 90 which should rise to above Rs 120/ as on March 2011.
Our price target Rs 175 in less than 6 months and investors holding it for medium term may get much higher appreciation.
Nahar Spinning Mills
Nahar has achieved phenomenal turnaround in 2009-10 wherein Nahar has achieved PAT of 53.49 cr and CASH Profit of Rs 123 cr (after paying income tax of Rs 27 cr). At PBT level, Nahar has achieved turnaround of Rs 105 cr as its PBT in 2009-10 stands at 80.60 cr as against loss of 25 cr in previous year.
Nahar is likely to earn Cash Profit of Rs 265-270 cr in 2 years (09-10 and 10-11) and current market cap is just Rs 290 crores. One of the top picks in booming textile sector. Investors may reap more than 50% appreciation in next few months. Scrip can even double in 12-15 months.
Src: Businessline, Valuenotes and etc
18 June 2010
RIL bets big on power and telecom
RIL plans mega foray into India's power sector
MUMBAI: Billionaire Mukesh Ambani today said his firm Reliance Industries will supply natural gas to Anil Ambani Group's power plants as and when they are ready to receive the gas. ( Watch )
Addressing company shareholders, Ambani mentioned the Supreme Court judgment upholding the company's stand that government has a major say in pricing and allocation of gas produced from RIL's eastern offshore KG-D6 fields and that RIL would supply gas to Anil Ambani group in accordance with government policy.
"With the legal dispute behind us, we look forward to harmonious and constructive relationship with ADAG," Ambani said at the meeting, for which Anil did not turn up as speculated in the market and media.
The supplies to Anil Ambani Group's power plants including the one proposed at Dadri near Delhi, will be subject to government approving the allocation of the fuel, Mukesh Ambani said.
The Supreme Court had last month asked the companies headed by the two brothers to rework a gas supply contract keeping the government policy on pricing and allocation in mind.
Mukesh, 53, however did not say when RIL will be entering into a new Gas Sales and Purchase Agreement (GSPA) with Anil's Reliance Natural Resources Ltd (RNRL) as had been ordered by the apex court.
RIL production from KG-D6 block exceeds 60 million standard cubic meters per day and over 30,000 barrels per day, Mukesh Ambani said.
"RIL has intensified exploration campaign off the east coast," added Ambani.
In his speech Mukesh Ambani proposed 70 per cent dividend or Rs 7 a share for 2009-10 fiscal for RIL shareholders.
The court had, on May 7, turned down gas to Anil-led RNRL from RIL's KG-D6 basin at prices arrived at in a 2005 private family agreement.
RIL, which acquired 40 per cent in shale gas assets of Atlas Energy in US, will continue to pursue shale gas opportunities, Mukesh Ambani said. The energy major was also drawing mega investment plans in coal, hydel and nuclear power.
RIL is also looking at expediting developing discoveries in blocks KG-D6 in Krishna Godavari basin, NEC-25 in Mahanadi basin, CB-10 in Cambay basin and Sohagpur CBM block.
"Annulling of non-compete agreement with ADAG was a game changing development that paved the way for Reliance to participate in power sector," added Mukesh Ambani.
Reliance Industries, which has agreed to buy Infotel, the only company to win a nationwide licence in India's wireless broadband auction, will follow an "asset light" approach in telecoms and collaborate with partners.
Reliance Industries' 36th AGM: Analysts views
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Mukesh Ambani’s AGM speech focussed on RIL’s core competencies: Rajesh Jain, Market Strategist
Src: ET and MOneycontrol.com
Addressing company shareholders, Ambani mentioned the Supreme Court judgment upholding the company's stand that government has a major say in pricing and allocation of gas produced from RIL's eastern offshore KG-D6 fields and that RIL would supply gas to Anil Ambani group in accordance with government policy.
"With the legal dispute behind us, we look forward to harmonious and constructive relationship with ADAG," Ambani said at the meeting, for which Anil did not turn up as speculated in the market and media.
The supplies to Anil Ambani Group's power plants including the one proposed at Dadri near Delhi, will be subject to government approving the allocation of the fuel, Mukesh Ambani said.
The Supreme Court had last month asked the companies headed by the two brothers to rework a gas supply contract keeping the government policy on pricing and allocation in mind.
Mukesh, 53, however did not say when RIL will be entering into a new Gas Sales and Purchase Agreement (GSPA) with Anil's Reliance Natural Resources Ltd (RNRL) as had been ordered by the apex court.
RIL production from KG-D6 block exceeds 60 million standard cubic meters per day and over 30,000 barrels per day, Mukesh Ambani said.
"RIL has intensified exploration campaign off the east coast," added Ambani.
In his speech Mukesh Ambani proposed 70 per cent dividend or Rs 7 a share for 2009-10 fiscal for RIL shareholders.
The court had, on May 7, turned down gas to Anil-led RNRL from RIL's KG-D6 basin at prices arrived at in a 2005 private family agreement.
RIL, which acquired 40 per cent in shale gas assets of Atlas Energy in US, will continue to pursue shale gas opportunities, Mukesh Ambani said. The energy major was also drawing mega investment plans in coal, hydel and nuclear power.
RIL is also looking at expediting developing discoveries in blocks KG-D6 in Krishna Godavari basin, NEC-25 in Mahanadi basin, CB-10 in Cambay basin and Sohagpur CBM block.
"Annulling of non-compete agreement with ADAG was a game changing development that paved the way for Reliance to participate in power sector," added Mukesh Ambani.
Reliance Industries, which has agreed to buy Infotel, the only company to win a nationwide licence in India's wireless broadband auction, will follow an "asset light" approach in telecoms and collaborate with partners.
Reliance Industries' 36th AGM: Analysts views
MUMBAI: Mukesh Ambani, chairman of energy major Reliance Industries, said the firm is ready to provide gas to power plants controlled by his brother Anil Ambani's Reliance ADAG and looks forward to a "harmonious and constructive" relationship with the company. ( Watch )
Following are comments from analysts:
ARUN KEJRIWAL, DIRECTOR OF RESEARCH FIRM KRIS IN MUMBAI: "There were a lot of unrealistic expectations built around Reliance AGM. The hype is now fading, which is reflected in the share price movement."
NITIN ZAMRE, MANAGING DIRECTOR AT CONSULTANCY ICF INTERNATIONAL, NEW DELHI: "The AGM is on expected line. The two brothers coming together throws open opportunity for both RIL and ADAG, but more for RIL. "Given the fact Reliance has core competency in building very large projects, power is the next opportunity mainly ultra mega power Projects, data management and shale gas."
GAJENDRA NAGPAL, CEO OF UNICON FINANCIAL, NEW DELHI: On expansion into power: "They are sitting on so much cash. It's a natural extension of Reliance's business of energy. To that extent, it seems like a well thought of move. I am extremely bullish on the counter in the long run. He is absolutely making all the right moves." On share movement: "Expectations are slowly tickling down. I see no reason why shares should fall now. It's just profit taking. "One would want to hear about his financial services foray. That also seems like a big opportunity."
K.K. MITAL, HEAD OF PORTFOLIO MANAGEMENT SERVICES, GLOBE CAPITAL, NEW DELHI: "Mukesh's vision is quite clear. He wants to concentrate on 4G spectrum; he wants to concentrate on power. He wants to do global acquisitions. "There were lot of speculations that Reliance Industries may buy a stake in Reliance Communications; Mukesh may support Anil's Reliance Power. "There were also speculation that Anil Ambani might turn up at the AGM. But let's remember that this is just the beginning. Going forward there will be many more opportunities (for tie up between the brothers)"
TEJAS DOSHI, HEAD OF RESEARCH, SUSHIL FINANCE IN MUMBAI: "People had built unrealistic expectations that there would be big-bang announcements at the meeting. "The disappointment is showing in the stock price of the companies led by both Ambani brothers."
SUSHANT GUPTA, SENIOR ANALYST WITH WOOD MACKENZIE, SINGAPORE: "Refinery-wise they are the most competitive in the region. If you look at refining margins, there is a downward trend which I expect to continue for at least next few years. "Even companies like Reliance are finding it challenging to push products in the global markets at better margins. Reliance should diversify and step up focus on petrochemical sector, which is one of the major contributory to its profit."
MITEN MEHTA, FUND MANAGER BELLWETHER CAPITAL, MUMBAI: "Mukesh Ambani words were more or less expected after the end of the non-compete agreement. In fact there were more expectations than what was actually announced. Reliance Industries needs to get into other areas now and power is an obvious choice for them."
GUL TECKCHANDANI, INDEPENDENT ANALYST, MUMBAI: "His announcements on the power sector sound good. Mukesh has the record of being conservative in his announcements but delivering on what he says. "India needs more power and the more people that enter the sector, the better."
Following are comments from analysts:
ARUN KEJRIWAL, DIRECTOR OF RESEARCH FIRM KRIS IN MUMBAI: "There were a lot of unrealistic expectations built around Reliance AGM. The hype is now fading, which is reflected in the share price movement."
NITIN ZAMRE, MANAGING DIRECTOR AT CONSULTANCY ICF INTERNATIONAL, NEW DELHI: "The AGM is on expected line. The two brothers coming together throws open opportunity for both RIL and ADAG, but more for RIL. "Given the fact Reliance has core competency in building very large projects, power is the next opportunity mainly ultra mega power Projects, data management and shale gas."
GAJENDRA NAGPAL, CEO OF UNICON FINANCIAL, NEW DELHI: On expansion into power: "They are sitting on so much cash. It's a natural extension of Reliance's business of energy. To that extent, it seems like a well thought of move. I am extremely bullish on the counter in the long run. He is absolutely making all the right moves." On share movement: "Expectations are slowly tickling down. I see no reason why shares should fall now. It's just profit taking. "One would want to hear about his financial services foray. That also seems like a big opportunity."
K.K. MITAL, HEAD OF PORTFOLIO MANAGEMENT SERVICES, GLOBE CAPITAL, NEW DELHI: "Mukesh's vision is quite clear. He wants to concentrate on 4G spectrum; he wants to concentrate on power. He wants to do global acquisitions. "There were lot of speculations that Reliance Industries may buy a stake in Reliance Communications; Mukesh may support Anil's Reliance Power. "There were also speculation that Anil Ambani might turn up at the AGM. But let's remember that this is just the beginning. Going forward there will be many more opportunities (for tie up between the brothers)"
TEJAS DOSHI, HEAD OF RESEARCH, SUSHIL FINANCE IN MUMBAI: "People had built unrealistic expectations that there would be big-bang announcements at the meeting. "The disappointment is showing in the stock price of the companies led by both Ambani brothers."
SUSHANT GUPTA, SENIOR ANALYST WITH WOOD MACKENZIE, SINGAPORE: "Refinery-wise they are the most competitive in the region. If you look at refining margins, there is a downward trend which I expect to continue for at least next few years. "Even companies like Reliance are finding it challenging to push products in the global markets at better margins. Reliance should diversify and step up focus on petrochemical sector, which is one of the major contributory to its profit."
MITEN MEHTA, FUND MANAGER BELLWETHER CAPITAL, MUMBAI: "Mukesh Ambani words were more or less expected after the end of the non-compete agreement. In fact there were more expectations than what was actually announced. Reliance Industries needs to get into other areas now and power is an obvious choice for them."
GUL TECKCHANDANI, INDEPENDENT ANALYST, MUMBAI: "His announcements on the power sector sound good. Mukesh has the record of being conservative in his announcements but delivering on what he says. "India needs more power and the more people that enter the sector, the better."
Rajesh Jain, Market Strategist: 'Mukesh Ambani’s AGM speech focussed on RIL’s core competencies': Mukesh Ambani’s AGM speech should be signalled out for the fact that he has focussed most of it on driving the core competence and the world class scale that he enjoys in the refining, petrochemical and the exploration business. That is the biggest takeaway from this speech today aside from announcements for the power and the telecom in the broadband space.
Essentially what Mukesh has signalled today is that we are not going to be trading on each others’ stores. We have our domain cut out. We are going to be thinking big in power but it will be nuclear, it will be hydel, it will be the cleaner coal based projects.
Essentially what Mukesh has signalled today is that we are not going to be trading on each others’ stores. We have our domain cut out. We are going to be thinking big in power but it will be nuclear, it will be hydel, it will be the cleaner coal based projects.
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RIL bets big on power and telecom
Src: ET and MOneycontrol.com
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