| INDUSTRY Go To Top Swaraj Baggonkar Business Standard (Web & Print Edition)
Mumbai: Even after people rushed to various centres to book the Nano on Saturday, the last official day for doing so, dealers undertook bookings on Sunday and, breaching the time-line set by Tata Motors.
A couple of dealers in Mumbai and one in Goa said application forms for the Nano were being accepted for the full day yesterday and till afternoon. However a Tata Motors directive later asked all dealers to halt.
We were accepting fresh bookings till noon and yesterday, however, only outright purchases were considered. Finance was not available as banks had stopped their process on Saturday itself, said an executive from Wasan Motors in Mumbai.
Similarly, Vistar Motors, based in Margao, Goa, said it accepted bookings for a few hours till noon and also on Saturday beyond 6pm, their official closing time.
Sales executives working with Fortune Cars, a Tata Motors dealership in Mumbai, also undertook bookings till Sunday. However, no bookings were accepted. When spoken to, the spokesperson of Tata Motors said, Bookings had closed on April 25 itself. Some people submitted documents which they were not able to file earlier. No new fresh bookings were accepted.
Most popular booking centres, including Tata dealerships, saw the highest inflow of applications on the final day.
According to an official announcement by Tata Motors at the time of launching the Nano, bookings were to commence on April 9 and conclude on April 25 for the first batch of 100,000 units of the car.
The company will disclose the total bookings before the end of the week. http://www.business-standard.com/india/news/nano-booking-rush-beyond-official-deadline/356463/
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| CARS, SUVs, MUVs Go To Top Chanchal Pal Chauhan The Economic Times (Web Edition)
New Delhi: The failure of Indian car market to expand in size has left many car makers with huge idle capacities. After a year of flat sales in the domestic market along with grim exports, the huge expansion plans executed in the past three years, entailing a $5 billion investment, are heading for a tailspin.
The beleaguered American car major General Motors fully owned Indian subsidiary tops the chart for unutilised capacity. Its barely utilised a-fourth of its plant capacity in FY 09. We have build-up capacities keeping in view the future demand. Our capacities are split in two plants, the smaller Halol plant will be utilised for bigger cars, while the bigger Talegaon factory is reserved for small cars. Copyright 2008, Bennett, Coleman & Co. Ltd. All Rights Reserved" http://economictimes.indiatimes.com/Huge-idle-capacities-now-haunt-carmakers/articleshow/4457386.cms
VOLKSWAGEN STARTS TRIAL PRODUCTION OF POLO The Hindu Business Line (Web & Print Edition)
Pune: Trial production of the Polo at Volkswagen Indias (VWI) Chakan plant was flagged off by Dr Philipp Rosler, the Minister of Economics, Labour and Transportation of the German Federal State of Lower Saxony.
The car, VWIs first locally made product in the Indian market, will be unveiled at New Delhis Auto Expo in January 2010, with commercial production to follow.
Dr Rosler, who was accompanied by a 30-strong delegation of business leaders from the German State, said, We are interested in the progress of the company which is headquartered in our State. We also hope to improve our partnership with the Indian economy.
Incidentally, Lower Saxony State holds a 20.1 per cent stake in the parent company Volkswagen AG.
VWIs Chakan plant has provision to manufacture cars on two independent platforms, one of which will begin commercial production of Group company Skodas compact car Fabia by the middle of next month. The Polo will also be produced on this platform.
Since plans are afoot to progressively increase the degree of local content in the Polo, Mr Jorg Mueller, President and Managing Director, VW Group in India, indicated that some suppliers may consider setting up their facilities within the 575-acre complex.
Discussions with some of our vendors for this are underway, he said.
The Chakan plant is amongst VWs few plants worldwide that will conform to the Groups two-shift theory. In Germany most plants work 3-shifts. But this plant will work only two shifts even at peak production, Dr John Chacko, Technical Managing Director, said, adding that there will be a 2-hour gap between the end of one and the start of the other.
The rationale behind the theory is that workers of one shift finish their work before the others get in, Dr Chacko said. VWs plant in Russia also conforms to this pattern, so will the one in the US.
The Chakan plant, which has an installed capacity to build 110,000 cars will produce a car every two minutes at maximum production. Time taken for a Polo or Fabia to start at the press shop and end at the final roll out will take around 18 hours. Automation here will be 35 per cent against 98 per cent in Germany, Dr Chacko explained. The current strength of 720 workers will touch 2,500 by the end of 2010. http://www.thehindubusinessline.com/2009/04/28/stories/2009042850820200.htm
BEETLE TO HIT INDIAN ROADS BY NOVEMBER, POLO IN JANUARY Arun Jayan Yahoo India (Web Edition) See this story in: The Indian Express (Delhi Print Edition)
A whole range of cars - starting from the Beetle, commonly known as the Bug, to the much awaited hatchback Polo - are all set roll out from Volkwagen India stable. As per plans of the auto major, Indian roads will see an imported Beetle in November this year and Polo exclusively made for the Indian market will hit the Indian road in 2010.
The pre-series production of mid-segment car Polo started on Monday from its Chakan plant, 40 km from Pune. The full-fledged production of the car will start from December 2009 and the car will be officially launched in January 2010 at the Auto Expo in Delhi.
Volkswagen will also launch another sedan on the Polo platform in August-September 2010 in the Indian market, production of which will start from the Chakan plant in 2010 June-July. The plant will begin building the Skoda Fabia compact car in May 2009, said a company official. On pre-series, 100 Polos and 60 Skoda Fabias will be produced before the start of the full-fledged production.
Jorg Muller, president and managing director Volkswagen Group India, said that the Polo would be launched with 50 per cent localisation, which would be increased to 80 per cent within the enxt two-and-a-half years. "We are in discussion with the vendors here regarding the setting up of the vendor park. Also we are in touch with the foreign vendors including German suppliers," said Muller.
Dr Phillipp Rosler, Minister for Economics, Labour and Transportation of the German Federal State of Lower Saxony, who is also a member of the supervisory board of Volkswagen AG who visited the plant officially give the go-ahead for the first welded body of the Polo car.
"The federal state has over 20 per cent stake in Volkwagen and that is one of the reasons that brings me here and I am impressed with the plant. Our team also visited other Industries in the region and we hope to carry out business ties with the companies here," said Rosler, who headed a group of 30 German business delegates representing various industries like IT, Automotive, Life Science, and Railways among others. The group also visited the Tata Motors Pune plant before visiting the Chakan plant of Volkswagen India.
The plant spread over 575 acres has a maximum production capacity of 110,000 vehicles destined for delivery to the Indian market. With a total financial commitment of Rs 3,800 crore the Chakan plant represents largest investment to date by a German company in the country.
Volkswagen will also enter the commercial segment in the country. The group first came to the country in 2001 with the opening of Skoda plant in Aurangabad. Apart from Squada Fabia, Octavia and Superb, the company also builds Jetta, Passant, Audi A4 and A6 in Aurangabad plant. Currently the company has around 120 dealers in the country. http://in.biz.yahoo.com/090427/203/bathq9.html
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| COMMERCIAL VEHICLES Go To Top Abhinaba Das The Economic Times (Web Edition)
With the commercial vehicle segment showing very little signs of a revival, Ashok Leyland, Indias second largest truck maker, is reviewing its collaboration with Nissan Motor of Japan to manufacture light commercial vehicles. Copyright 2008, Bennett, Coleman & Co. Ltd. All Rights Reserved" http://economictimes.indiatimes.com/Leyland-may-review-LCV-JV-with-Nissan/articleshow/4457295.cms
TATA MOTORS LAUNCHES NEW STARBUS IN MAHARASHTRA PTI See this story in: The Hindu Business Line (Web Edition), Deccan Herald (Web Edition), Hindustan Times (Delhi Print Edition)
Mumbai: Tata group company, Tata Motors, on Monday announced the launch of an all-new Starbus range of buses in Maharashtra. The buses are being manufactured at the fully- automated Tata Marcopolo Motors Limited (TMML) plant which is a joint venture between Tata Motors and Marcopolo of Brazil, a press release issued said.
The plant is located in Dharwad, Karnataka. The Starbus will be sold to customers as fully-built buses and coaches, the release said. These buses are ideal for all applications including transportation of school children, company staff, route bus and a s a transport to route destinations. http://www.thehindubusinessline.com/blnus/02271550.htm http://deccanherald.com/Content/Apr282009/business20090427132788.asp
DEUTSCHE SEC HIKES STAKE IN EICHER
Mumbai: Foreign fund house Deutsche Securities Mauritius has hiked its stake in commercial-vehicle maker Eicher Motors to 5.17%, after purchasing fresh shares through an open-market transaction.
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| CONSTRUCTION & AGRI MACHINERY Go To Top The Hindu Business Line See similar story in: Daily News & Analysis Hyderabad: Pennar Industries Ltd., has posted a net profit of Rs 14.97 crore and gross sales of Rs 167.50 crore for the fourth quarter ended March 31, 2009 and barely managed to retain its profit, while its revenues were lower in comparison to the corresponding quarter last year.
Last year same period, the company had recorded Rs 183.99 crore in revenues and net profit of Rs 14.5 crore, when the prices of steel and other by-products were at their peak and the excise duty was high at 14 per cent.
Therefore, the overall revenues are lower compared to corresponding quarter, Mr Nrupender Rao, Chairman of Pennar Group of Companies, said.
Buyback decision Addressing a press conference here after the company board meeting, Mr Rao said that the board has decided to go in for a buyback of the company shares through the stock exchange route, at a price not exceeding Rs 40 a share.
The promoter group holds about 36 per cent equity in the company. The buyback amount will not exceed Rs 12.50 crore, which represents 9.74 per cent of the total paid up equity shares and free reserves of the company.
The buyback from stock exchanges will help small shareholders who have not yet opted for demat accounts. For the financial year ended Mach 31, 2009, the company closed with revenues of Rs 730.76 crore and net profit of Rs 52.94 crore as against total revenues of Rs 641.20 crore and profit of Rs 39.97 crore for previous fiscal.
The move to go in for buyback is well thought out. The company is heading to a debt-free status and the business prospects look good in spite of tough economic scenario. This buyback of shares will reinforce confidence in the company, Mr Ravi Rajagopal, Chief Financial Officer of Pennar, said.
Focus on value addition The company has restructured its product portfolio and is now concentrating on value addition. The focus therefore, is on engineered products for automotives, railways, road construction and other areas, Mr Rao said. http://www.thehindubusinessline.com/2009/04/28/stories/2009042850810200.htm http://www.dnaindia.com/report.asp?newsid=1251036
ATLAS COPCO MARCH NET DIPS 42% AT RS 14.46 CR The Hindu Business Line
Mumbai: Construction and mining equipment maker Atlas Copco India on Monday said its net profit dipped by 42.04 per cent to Rs 14.46 crore for the quarter ended March 31, 2009, over the same quarter last year.
The company had a net profit of Rs 24.95 crore for the same quarter ended March 2008, Atlas Copco India said in a filing to the Bombay Stock Exchange.
Total income of the company fell to Rs 280.99 crore during the quarter under review from Rs 285.89 crore in the same quarter previous fiscal. Shares of Atlas Copco India were trading at Rs 515.05, down 1.87 per cent on the BSE. http://www.thehindubusinessline.com/blnus/26271866.htm
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| 2/3 WHEELERS Go To Top Swaraj Baggonkar Business Standard
Mumbai: Japanese two-wheeler maker Honda and its Indian partner, the Hero group, wish to further their 25-year-old partnership. Both sell two-wheelers, including motorcycles and automatic scooters, in the same segments, with some cannibalisation already taking place, according to executives in Hero Honda, Indias largest two-wheeler producer.
Both companies may look at sharing details of new products with each other, including engines, design sequences and vehicle platforms. Honda Motorcycle and Scooter India (HMSI), the countrys fourth-largest two-wheeler maker, has already helped Hero Honda Motors (HHML) in areas like design and styling for a couple of products.
Speaking to Business Standard, Shinji Aoyama, president and CEO, HMSI, said, We enjoy a very positive association with Hero Honda. We shared the basic vehicle design with them for their new CBZ and Hunk (motorcycles). We may look at sharing engines or platforms in the future but there are no confirmed plans yet.
Currently, HMSI and HHML share a supply chain and details related to production capacity. Recently, Pawan Munjal, managing director and CEO, HHML, said since both operated in the 100-150cc segment, there had been some cannibalisation of products. Hero Honda sells as many as 14 products in the local market and HMSI sells six.
According to an earlier understanding between the two, HMSI was to look at capitalising only on the scooter segment, while HHML was to focus on the motorcycle segment. However, when the motorcycle market grew faster than the scooter, HMSI was forced to change strategy.
With the launch of Unicorn (150cc model) in 2004, HMSI announced its entry into the motorcycle segment. Thereafter, it launched two more motorcycles, both in the 125cc segment.
The company will also launch a 100cc motorcycle, a segment which accounts for about 70 per cent of the entire market and where Hero Honda has a near-monopoly. The bike will be launched by December this year or early next year.
According to data from the Society of Indian Automobile Manufacturers (Siam) for March 31, Hero Honda has almost 60 per cent share in the motorcycle segment, while Honda commands 57 per cent in the scooter segment.
Hero Hondas revised strategy is to focus on the largely-untapped rural market, while Honda will focus on aggressively-styled products that are better suited to the urban consumer.
Both fared well last year despite the downturn in the domestic market. HMSI, for the first time, sold more than a million units in the domestic market, a growth of 16.5 per cent. The company has projected a growth of 18 per cent this financial year, with sales of 1.2 million units in the Indian market.
It is also hoping to increase its growth in the motorcycle segment by 25 per cent by next year, aided by as many as five new launches. A city-based analyst said since both companies competed in the same space, they could save through sharing technology and better production management.
HERO ELECTRIC EYES 60% SALES GROWTH Yogima Seth The Financial Express See this story in: Yahoo India
New Delhi: Hero Electric, with a market share of 45% in the electric two-wheeler industry, is riding high on new products and is eyeing over 60% growth in sales in 2009-10 at 50,000 units as compared to 31,000 units sold last year. This is expected to increase its revenue from Rs 70 crore to over Rs 110 crore in the current financial year.
Hero Electric plans to introduce four to five new products in this financial year including a new scooter towards the end of May which will help us register higher growth than the industry, says Naveen Munjal, managing director, Hero Electric, adding that several new initiatives taken by the company in the last financial year will further give a boost to demand. Munjal, however, refused to divulge details about the new products. Hero Electric had launched its new scooter Wave in southern India in December last year and it plans for a nation-wide launch of the vehicle in few months. According to the recently formed Society of Manufacturers of Electric Vehicles (Smev), sales of total electric vehicles in the country (97-98% of which are two-wheelers) is estimated to jump by 45% in the current financial year at 1,60,000 units as compared to 1,10,000 units sold in 2008-09.
According to Munjal, the company is planning to add another 90 dealers into its fold from 260 now and to 350 by the end of March 2010. Moreover, with enhanced focus on below-the-line activities this year, we expect to increase our revenues by over 55% in the current financial year to over Rs 110 crore, he adds.
Hero Electric had, however, fallen short of its estimated target of 40,000 units in the last financial year, due to low sentiments, slowdown in the overall economy oil prices. The companys sales for 2008-09 were 22.5% less at 31,000 units than its earlier estimate of 40,000 units.
The company has recently introduced auxiliary batteries (power backup) in its Maxi range of two-wheelers. These batteries have an additional cost of Rs 7,000 that shoots up the cost of the vehicle to Rs 29,000-Rs 30,000 and gives an extended range of 40 km. In March this year, Hero Electric introduced Electric bike assistance mechanism wherein a Hero Electric owner might avail the 12-hour on road assistance and could even get the vehicle serviced at home.
According to the Society of Indian Automobile Manufacturers, total two-wheeler sales went up by 2.6% in 2008-09 at 74,37,670 units as compared to 72,49,278 units in the preceding year. http://in.biz.yahoo.com/090427/50/bathq5.html
BAJAJ ON HIRING MODE, EFFECTS 7% PAY HIKE Murali Gopalan The Hindu Business Line
Mumbai: At a time when salary cuts and layoffs are the order of the day, Pune-based Bajaj Auto has not only hired over 500 people but has just implemented a seven per cent pay hike.
The fresh recruitments have been made anticipating the growth in our two-wheeler business as well as the foray into the ultra-low cost car project. All this is reflective of the tremendous confidence within the company, the Managing Director of Bajaj Auto, Mr Rajiv Bajaj, told Business Line.
Though the year that just ended was not much to write home about in terms of volumes and market share, 2009-10 has begun well with domestic sales of motorcycles on course to cross one-lakh units this month.
Bike sales, including exports, were barely around 1,10,000 units in December 2008 but are now targeted at a healthier 1,60,000 units in April and May. The XCD 135 is doing well at over 20,000 units a month while the new Pulsar 150 has also been well received. Likewise, the new Pulsar 180 despatched from the plant less than a week ago is getting a positive response at dealerships it has reached, he said.
Export track Bajaj Autos exports had also shown a slide in the fourth quarter of 2008-09 but are getting back on track now. At present, we are in the level of 45,000 units (two- and three-wheelers) but expect this to touch 55,000 vehicles next month and reach levels of 65,000 units during June and July, Mr Bajaj said.
Last fiscal, the company lost Rs 300 crore on profit before tax, arising from exports, because it had hedged the dollar at Rs 40 only to see it spiral to Rs 50. This was quite a setback when Bajaj Autos exports, which account for nearly 40 per cent of its business, are in the region of Rs 250 crore each month.
As he put it, however, all this was best forgotten as the current fiscal promises to be a lot better. The comeback of the XCD brand coupled with good business prospects for the Pulsar upgrade and better export numbers have worked wonders and this will be evident in the May sales figures. I am confident that the company will have a very good year overall, he said.
Cost control Back-end efforts to keep costs in check through platform strategies, vendor rationalisation, etc have been going on for years now within Bajaj Auto and the positives have percolated across the supply chain.
We have been constantly doing this, and this is a battle we have already fought. Our costs are well under control but it is the front-end strategy in terms of better products, better price and a better push that is paying rich dividends now. We have held up the front-end with an efficient cost structure at the back-end, Mr Bajaj said.
Incidentally, Africa has emerged as one of the important destinations for the companys two and three-wheelers. The continent accounts for 40 per cent of its exports with Asia and South America taking up the balance.
African market Mr Bajaj also reiterated that contrary to common perception, Africa was an extremely profitable market for the company.
It is as good as any other part of the world where we do business. Our motorcycles are up against stiff competition from much cheaper Chinese bikes. Yet, we retail at a 30 per cent premium and our motorcycle numbers are on the rise which speaks a lot for brand and quality. Eventually, it is about being more brand-led than product-led, he added. http://www.thehindubusinessline.com/2009/04/28/stories/2009042852050100.htm
BAJAJ DTSI BIKES GET INTO TRANSFORMERS MODE Arcopol Chaudhuri Daily News & Analysis Mumbai: As the world comes to India's doorstep to shoot ad films, advertising agency Leo Burnett has hit a reverse sweep with its latest TV commercial for Bajaj DTSi.
Executive creative director K B Vinod's eureka moment for this 'reminds-me-of-Transformers' commercial happened during one of the long briefing sessions at Bajaj's R&D centre in Pune."I imagined the engine coming alive and walking about like a human being. Over the next one week, the thought fully formed in my head," he says.
The objective of the TVC was to establish the technological edge in Bajaj DTSi engines. Amit Nandi, head of marketing, Bajaj Auto, says, "Technology has always been in the DNA of our brand. This ad essentially brings together technology along with sport and youthfulness in a way we've never seen before."
Bajaj, which self-admittedly began with the chick-magnet positioning of bikes for Bajaj Pulsar (Definitely Male), began taking baby steps away from this positioning last year itself with the launch of Pulsar Mania commercial, where bikes were seen doing the ballet. The auto major's lavish creative mandate is shared by three agencies -- Lowe, O&M and Leo Burnett.
For the latest TVC, more or less done in VFX, Leo Burnett contacted some of the best ad film-makers across the world, but the cost and working chemistry worked out best with Tarsem Singh, the India born US-based filmmaker who previously directed films such as The Cell and The Fall. Vinod describes Tarsem as "the Steven Spielberg of ad filmmaking."
"We soon brought in a concept artist from Hollywood and designed the motion capture shoot that happened at Pinewood Studios near London. Basketball players and acrobats were brought in for the shoot and then in the next stage, revisualisation of the film happened where it was textured and rendered. http://www.dnaindia.com/report.asp?newsid=1251041
GOVT CLEARS YAMAHA'S PROPOSAL TO SHIFT SALES BIZ TO NEW ENTITY PTI See this story in: The Economic Times
New Delhi: Government on Monday approved Japanese two-wheeler major Yamaha's proposal to transfer its Indian sales business to a new entity India Yamaha Motor Pvt Ltd.
SAR GROUP ENTERS E-BIKE SEGMENT Business Standard
New Delhi/ Jalandhar: SAR Group, which is into power products among others, has entered the automobile sector by opening an e-bike showroom in Jalandhar. The company plans to invest Rs 200 crore over the next five years in the venture and also set up a plant in Himachal Pradesh.
The two-wheeler market in north India, especially in Jalandhar, is fast growing. Hence we look see it as one of our key target markets for the future, said Vikas Arora, regional sales manager, Lectrix Motors Limited.
The domestic e-bike market is pegged at Rs 500 crore and expected to grow to Rs 600 crore in the next 4-5 years, he said. http://www.business-standard.com/india/news/sar-group-enters-e-bike-segment/356375/
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| COMPONENTS Go To Top Business Standard See similar story in: The Hindu Business Line, The Financial Express
Bangalore: Bosch Ltd, a supplier of automotive components to original equipment makers (OEMs), has reported 69.4 per cent drop in net profit to Rs 49.3 crore for its first quarter ended March 2009, compared with the corresponding quarter last year. Its net sales for the quarter dropped 20.6 per cent to Rs 991.6 crore.
The drop in net profit is largely due to a dip in demand by major OEMs in the domestic and export markets. The company, which imports a lot of components, was also hit by the rupees depreciation against the dollar. Operating profit for the quarter saw a massive drop of 82.2 per cent to Rs 33.50 crore.
VK Viswanathan, managing director, gave two more reasons for the drop. We had made huge investments last year. We also had to account for the depreciation in this quarter. As against Rs 52.5 crore depreciation recorded in the first quarter of last year, we took a charge of Rs 68.8 crore during the first quarter this year. Last year, we had a one-time income from sale of investment in mutual funds amounting to Rs 20.4 crore. This year, it dropped to Rs 7.2 crore. The companys earnings per share dropped to Rs 15.5 from Rs 50.5 in the corresponding quarter last year. http://www.business-standard.com/india/news/bosch-q1-net-drops-70-per-cent/356455/ http://www.thehindubusinessline.com/blnus/02271352.htm http://www.financialexpress.com/news/indian-bank-net-profit-up-23/451939/2
SUNDARAM NET LOSS AT RS 4.82 CR Business Standard See similar story in: The Hindu Business Line, The Financial Express
Sundaram Clayton Ltd, Chennai-based automotive components manufacturer, reported a net loss of Rs 4.82 crore for the fourth quarter ended March 31, 2009, as compared with a profit of Rs 5.99 crore in the same quarter last year.
The companys net sales dropped 3 per cent to Rs 112.91 crore from Rs 116.28 crore. http://www.business-standard.com/india/news/sundaram-net-loss-at-rs-482-cr/356481/ http://www.thehindubusinessline.com/blnus/26271868.htm http://www.financialexpress.com/news/indian-bank-net-profit-up-23/451939/2
The Hindu Business Line
Mumbai: SKF India, a major supplier of bearings, seals and lubrication systems, said its manufacturing facility in Haridwar, Uttarakhand, will become operational in January 2010. The company will invest Rs 150 crore in this project and employ 200 people in the plant, said a release here. The new plant will have the capacity to produce 40 million bearings annually. SKF's move to increase production capacity through the Haridwar plant signifies its commitment to further increase its share in the developing two-wheeler and automotive market, said Mr Rakesh Makhija, Managing Director. http://www.thehindubusinessline.com/2009/04/28/stories/2009042850920202.htm
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| ALLIED INDUSTRY Go To Top The Hindu Business Line See similar story in: Daily News & Analysis, mint, Business Standard, The Financial Express
Kolkata: Exide Industries is now tightening its belt to face one of the most difficult years. The company posted close to nine per cent growth in net profit in the January-March 2009 quarter without any significant increase in turnover compared with the same period in 2008.
When compared with the third quarter of the last fiscal, profit was up by 21 per cent on one per cent topline growth. Approving the results, the company board recommended a final dividend of 20 paise a share (20 per cent), taking the total dividend to 60 paise a share (60 per cent).
The company ended the last fiscal with 14 per cent growth in net profit to Rs 284 crore against 17 per cent rise in turnover to Rs 4,233 crore. Debt-equity has come down to 0.26:1.
Outlook for 2009-10 The current fiscal will definitely be a difficult year. While we are not sure of the topline growth in 2009-10, we would try to maintain the profitability by way of operational efficiency, cost-cutting and other such measures, Mr P. K. Kataky, Director (Automotive), told Business Line adding that no significant growth in OE demand for automotive batteries was expected during the current quarter.
According to him, Exide may go in for expansion of its lead smelting capacity during the year to meet increased lead requirement from captive sources. A proposal in this regard may be placed before the board. The companys two smelters contributed 28 per cent of lead and lead alloy requirement during the last fiscal.
The company has reduced the price of automotive batteries by 5 per cent this month. This is over and above a seven per cent price cut in the third quarter. Automotive batteries contribute close to 65 per cent of Exides profit.
Mr Gautam Chatterjee, Director (Industrial), is hopeful of 15 per cent volume growth in sales in the industrial battery segment during the first quarter of the current fiscal riding primarily on increased demand for inverter and UPS batteries during the summer.
He expects an increased pressure on margins in the industrial battery segment as the global industrial battery market shrunk by 40 per cent and large manufacturers in the West are pulling down shutters.
Performance in Q4 According to Mr Kataky, both the OE and replacement sales improved in the fourth quarter compared with the previous (October-December 2008) quarter. While OE sales have increased by 10 per cent replacement sales moved up by almost 20 per cent. However, as against January-March 2008, OE demand was lower by two per cent and there was a marginal growth in replacement sales.
In the industrial segment, domestic demand increased 40 per cent (volume) compared to the same period last year and the total volume growth was 18 per cent. Exides shares closed 1.8 per cent higher at Rs. 53.75 on the BSE on Monday. http://www.thehindubusinessline.com/2009/04/28/stories/2009042850870200.htm http://www.dnaindia.com/report.asp?newsid=1251037 http://www.livemint.com/2009/04/27151548/Exide-Industries-profits-rise.html http://www.business-standard.com/india/news/exide-net-rises-9/356482/ http://www.financialexpress.com/news/indian-bank-net-profit-up-23/451939/2
RPG GROUP COMPANIES IN COST-CUTTING JUGGERNAUT
Among the belt-tightening measures was a ruthless shutdown of underperforming stores, cutting down on inventories that cost bank finance and speeding up project management to get things done faster. Careful layoffs in the 50,000-employee group are part of the recipe.
Some of our companies have started doing better than the last quarter of the previous year. Cost cutting measures have yielded results and we are spending wherever there is a need, said Group Chairman Harsh Goenka told Hindustan Times in an interview.
In the group as a whole, travel and advertisement bills have been checked, and collection of dues stressed. Dealers and customers have less elbow room on credit.
Goenka said non-performing retail stores were subject to pretty brutal closures that resulted in 10 to 15 per cent cost savings. As many as 100 out of 400 Spencers stores were shut and eventually relocated, while its management layers were reduced and organisational zones cut to six from 10. This saves Rs 10 crore a month, Goenka said.
Tyre maker Ceat has been saving Rs. 10 crore a month on inventories since last month. Our inventory is sharply down by about Rs 90 crore. Profitability at Ceat has gone up sharply. We have optimized forex and manpower management, Goenka said.
KEC International, the group company that sets up power transmission systems, is now on an efficiency drive to speed up projects and cut inventories. We are bring an entire culture of cost control, Goenka said adding that during the past few months the group had laid off 300 people including 70 managerial staff at Ceat, but has also recruited over 500 people.
We are still recruiting. During this period (when companies have frozen recruitment) we could manage to get high calibre talent. We are finding it attractive, http://www.hindustantimes.com/StoryPage/StoryPage.aspx?sectionName=RSSFeed-Business&id=d5e703c8-5df4-46b2-b588-a7d0a7ffb95f&Headline=RPG+Group+companies+in+cost-cutting+juggernaut
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| FINANCE & INSURANCE Go To Top
http://timesofindia.indiatimes.com/Business/General-Motors-ties-up-with-Future-Generali-/articleshow/4456925.cms
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| LUBRICANTS & ALTERNATIVE FUELS Go To Top The Hindu Business Line See similar story in: The Financial Express
Mumbai: Castrol India Ltd announced a net profit of Rs 76.30 crore for the quarter ended March 31, 2009 as compared with Rs 72.80 crore shown during the same quarter in 2008. Total income has increased to Rs 518.20 crore from Rs 504.80 crore in the last year quarter http://www.thehindubusinessline.com/blnus/26271605.htm
CRUDE OIL FALLS TO NEAR $49/BARREL AP See this story in: Asian Age
Singapore: Oil prices fell toward $49 a barrel on Monday in Asia as investors, groping for guidance amid a severe recession, took back Fridays gains. Benchmark crude for June delivery was down $2.14 to $49.41 a barrel in Singapore, in electronic trading on the New York Mercantile Exchange. The contract jumped $1.93. Oil has traded near $50 a barrel this month, about a third of its record high in July, as the global economy remains weak and traders grapple with an uncertain outlook for recovery. http://www.asianage.com/presentation/leftnavigation/news/business/crude-oil-falls-to-near-$49barrel.aspx
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| GM OFFERS SHARES TO ITS BOND HOLDERS TO TRIM DEBT BY $44 BN Bloomberg See this story in: The Economic Times
Southfield: General Motors Corp, working to stave off a June 1 US-backed bankruptcy , stepped up dealer shutdowns and job cuts and offered equity to bondholders under a plan to reduce liabilities by $44 billion.
GM OFFERS FINAL SURVIVAL PLAN, BOND DEAL Reuters See this story in: The Economic Times, The Times of India, The Tribune, The Telegraph
Detroit: General Motors Corp on Monday offered its final plan to reorganize outside bankruptcy by slashing bond debt, cutting over 21,000 more US jobs and emerging as a nationalized automaker under majority control by the US government. http://economictimes.indiatimes.com/News/International-Business/GM-offers- http://www.tribuneindia.com/2009/20090428/biz.htm#4 http://www.telegraphindia.com/1090428/jsp/business/story_10886939.jsp
DAIMLER REACHES DEAL ON CHRYSLER SEPARATION Reuters See this story in: The Economic Times
Daimler had sold an 80.1 per cent stake in the US automaker to private equity firm Cerberus CBS.UL in 2007, ending a stormy decade long relationship with the struggling US carmaker that is operating under US government aid.
UAW, CHRYSLER AND FIAT REACH CONCESSION DEAL AP See this story in: Hindustan Times, The Times of India
Detroit: Chrysler LLC cleared another major obstacle to its survival Sunday when it reached a tentative deal on concessions with the United Auto Workers union, helping it move closer to inking a vital alliance with Italys Fiat Group SpA.
The troubled automaker is just days away from a Thursday U.S. government deadline to gain concessions from its unions and debtholders and link up with Fiat or face almost certain liquidation. White House economic adviser Larry Summers said Sunday the Obama administration is holding out hope that Chrysler can avoid bankruptcy court.
The UAW late Sunday called the concessions painful but said the deal takes advantage of the Obama administration giving Chrysler and its workers a second chance. The administration in February rejected Chryslers restructuring plan and gave the Michigan automaker until April 30 to make further cuts and arrange to take on Fiat as a partner.
The UAW agreement is seen as a key piece of pulling Chryslers plan together, and its noteworthy that the UAW said Fiat was involved in the deal.
The provisional agreement provides the framework needed to ensure manufacturing competitiveness and helps to meet the guidelines set forth by the U.S. Treasury Department, Chrysler Vice President of Labor Relations Al Iacobelli said in a statement. As a result, Chrysler LLC can continue to pursue a partnership with Fiat SpA.
Separately, Canadian Auto Workers members on Sunday ratified a concessionary deal which CAW President Ken Lewenza said makes labor costs competitive with non-unionized Toyota in Canada. The two labor agreements now leave concessions from the holders of $6.9 billion in Chrysler secured debt and the alliance with Fiat as the remaining hurdles to Chrysler qualifying for additional government aid.
But debtholders, the company and the Treasury Department remain far apart on terms to swap equity in the company for much of the debt. A counteroffer to the debtholders from the Treasury is expected as early as Monday.
UAW Vice President General Holliefield said in a statement that UAW members and retirees are being asked to make extraordinary sacrifices to help Chrysler become viable. In order for the company to have a sustainable future, all stakeholders will have to show the same willingness to contribute to the common good that has been demonstrated repeatedly by our membership, he said.
Chrysler has been living on $4 billion in U.S. government loans and is expected to get another $500 million. Without government help, it would have gone out of business around the first of the year. The government has said it would be willing to loan Chrysler up to another $6 billion if it is able to complete its restructuring and ink the deal with Fiat.
After rejecting the February plan, the government had said the UAW and Canadian Auto Workers unions must make further concessions, including the UAW taking equity in the company for at least half of a $10.6 billion payment into a union-run trust that will take over retiree health care costs starting next year.
Details of the agreement were not available late Sunday. It will be presented to local union officials from across the country on Monday, with voting to wrap up by Wednesday.
But the UAW says its deal meets the requirements of U.S. Treasury Department loans to the company, and includes changes to the health care trust.
We recognize this has been a long ordeal for active and retired auto workers, and a time of great uncertainty, UAW President Ron Gettelfinger said in a statement. The patience, resolve and determination of UAW members in these difficult times is extraordinary, and has made it possible for us to reach the agreement we will present to our membership.
Fiat CEO Sergio Marchionne was in the U.S. as talks continued for the automaker to take a 20 percent stake in Chrysler in exchange for its small-car technology.
Two people briefed on the Fiat negotiations said that if a debt holder deal can be reached, most of the Fiat deal has been finished and an announcement would come shortly after a debt holder agreement. The people didnt want to be identified because the talks are private.
Fiat may build the small cars at Chrysler factories in the U.S., but they wouldnt arrive until late 2010 or early 2011, according to industry analysts.
Were hopeful that the negotiations, which have been proceeding with great energy, are going to conclude successfully, Summers said in an appearance on Fox News Sunday. You never know _ with any negotiation _ until the very end. There are some issues that have been worked out. There are some issues that remain to be worked out, but its in everybodys interest to see these negotiations succeed and were hopeful that they will. http://www.hindustantimes.com/StoryPage/StoryPage.aspx?sectionName=
AUDI Q1 OPERATING PROFIT DOWN 29% AP See this story in: mint
Frankfurt: German luxury carmaker Audi AG said Monday that its first-quarter operating profit fell by 29% as the global economic crisis ate into sales.
Ingolstadt-based Audi said its operating, or pretax, profit was down to euro363 million ($479 million) in the January-March period from euro514 million a year earlier. Audi, a subsidiary of Volkswagen AG, Europes largest carmaker, did not immediately report net profit.
Sales for the quarter were down 19% to euro6.7 billion from the previous years euro8.3 billion. Audi said it expected the rest of 2009 to remain difficult.
In light of the continuing global economic downturn, the Audi group expects to see a sharp drop in worldwide demand for cars in 2009, it said in a statement. Major sales regions, most notably North America and Europe, will be affected by the negative development. http://www.livemint.com/2009/04/27155528/Audi-Q1-operating-profit-down.html
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| ECONOMY & FINANCE Go To Top The Hindu Business Line
Mumbai: The rupee depreciated by around 45 paise against the dollar on Monday, pulled down by the greenbacks strength against other major currencies. It opened weak at 49.97 and fell to touch an intra-day low of 50.30. It closed at 50.26, against the previous close of 49.80/81. The rupee opened weak as the dollar strengthened against other currencies in the overseas markets, said a dealer with a public bank. Dollar buying by oil companies and importers to meet month-end de mand also exerted pressure on the rupee. However, recovery in the domestic equity indices and dollar selling by big corporates helped the rupee recoup some of its losses, added the dealer. In the forward premia market, the six-month premium closed at 2.87 per cent and the one-year closed at 2.26 per cent. http://www.thehindubusinessline.com/2009/04/28/stories/2009042851710600.htm
SENSEX UPSWING CONTINUES FOR THIRD DAY PTI See this story in: The Hindu Business Line
Mumbai: The Bombay Stock Exchange benchmark Sensex gained for the third day in a row on heavy purchases by funds of fundamentally strong stocks led by the banking and capital goods segments. Opening on a weak note, the Sensex rebounded in volatile trade to end with a gain of 42.80 points at 11,371.85. It moved between 11,492.10 and 11,176.55 points during the day.
However, the 50-share National Stock Exchange index Nifty fell by 10.75 at 3,470.00, after moving between 3,517.25 and 3,435.30. Buying was greater in the banking, capital goods and healthcare sectors on good earnings by blue-chip companies.
The banking index gained the most by rising 2.41 per cent to 5,726.59, after ICICI Bank, the second-largest lender by assets, got a good rating from Goldman Sachs on improved results. ICICI Bank gained 8.20 per cent to Rs 467.95, Federal Bank 5.54 per cent to Rs 187.80, Axis Bank 5.45 per cent to Rs 557.55 and Yes Bank 3.20 per cent to Rs 78.90. The capital goods index was the second-best performer, rising 1.57 per cent to 8,071.54, as stocks of Larsen and Toubro, BHEL, BEML, and Havells recorded handsome gains- http://www.thehindubusinessline.com/blnus/05271901.htm
INDIA LIKELY TO GROW AT 6 PER CENT, SAYS MONTEK PTI See this story in: The Hindu Business Line
Washington: India is expected to record a gross domestic product (GDP) growth rate of 6 per cent this fiscal, which will improve further in the next fiscal with likely recovery in the global economy, Planning Commission Deputy Chairman Mr Montek Singh Ah luwalia said here on Monday.
Next year they (IMF) expect the global economy to improve. I am hoping that our economy will also be able to improve,'' he said while talking Indian news agencies on the sidelines of the G-20 ministerial meeting.
Although the Reserve Bank too has projected a growth rate of 6 per cent during the current fiscal, many global agencies like the International Monetary Fund and World Bank expect the Indian economy to expand by only 5.25 per cent and 4 per cent, respectively. Noting that the global economy is passing through a very severe phase, Mr Ahluwalia said, We are weathering it better than most countries.'' The India economy during 2008-09, according to advance estimates for national income released by the Central St atistical Organisation (CSO) in February, was estimated to grow by 7.1 per cent, down from 9 per cent in the previous fiscal. http://www.thehindubusinessline.com/blnus/14271655.htm
Last Financial closing
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Monday, April 27, 2009
Indian Auto Industry News - 28 Apil09
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