GAIL looks to sell part of ONGC stake

 Company’s investment of ` 556 cr used to buy a 4.8% stake in ONGC has grown to ` 5,880 cr

Sitting on handsome gains worth over 10 times its initial investment, India’s largest gas transportation company, state-owned GAIL (India) Ltd may look at part sale of its crossholdings of 4.8% in sister PSU — Oil and Natural Gas Corp (ONGC).

GAIL’s investment of 556 crore that was used to buy 4.8% in ONGC in 1999-2000 has grown to 5,880 crore. Offloading part of the cross-holdings is likely to help GAIL generate finances to help fund the company’s overseas forays and acquisitions.
A part sale of GAIL’s cross holdings in ONGC could be utilised by the company in funding one its largest acquisition of $3 billion that is currently underway for acquiring gas assets in a $20-billion project at Tanzania in East Africa, company sources said.
“Sale of crossholdings is one of the options that we could look at as and when we need funds,” BC Tripathi, chairman and managing director, GAIL,
Besides meeting the company’s capital expenditure requirements, the divestment of cross-holdings would also reduce a company’s borrowings and improve profitability through savings in interest costs.
“Oil and gas PSUs are free to sell their cross-holdings in sister PSUs in order to reap benefit of appreciation in share prices,” a senior ministry official said.

GAIL recently sold a fourth of its 4.6% stake in overseas city gas distribution company China Gas Holdings for 385 crore.
Indian Oil Corp (IOC) also sold 1.92% in in ONGC for 3,672 crore in 2002. IOC also sold half of its 2.4% holding in GAIL for 561 crore, a move that helped IOC net manifold gains.
“Depending on the requirement of funds, we will exercise this option to meet our future needs,” said PK Goyal, finance director, IOC.
While ONGC bought 9.1% of government’s equity in IOC and 4.83% in GAIL, IOC bought 4.83% in GAIL and 9.61% in ONGC, and GAIL bought 2.4% in ONGC.

Indices gallops to its highest level in 2013

Sensex gained 359 points to close at 20,929 and the Nifty added 120 points to end at 6,221

Benchmark share indices ended at their highest level in 2013 so far led by bank shares after the RBI at its second Quarter Review of Monetary Policy 2013-14 today announced a hike in repo rate by 25 bps which was on expected lines.

At close, the Sensex ended up 359 points at 20,929 and the Nifty ended up 120 points at 6,221.

Both the Sensex and the Nifty registered their highest closing in the calendar year 2013 so far . Also, it was the seventh highest turnover for the markets. The one to lead the rally today, the Bank Nifty, closed at his highest level since July 15.

In the broader markets, the midcap index gained 1.5% and the smallcap index added 0.5% as compared to the 1.7% uptick seen on the BSE benchmark index.

RBI in its monetary policy review today hiked the repo rate by 25 bps to 7.75%. The MSF rate was cut by 25 bps to 9.25%. CRR was left unchanged at 4%. The central bank cuts the FY14 GDP growth forecast to 5% from 5.5%. Giving a CPI forecast for the first time, the RBI said retail inflation will remain above 9%, adding that both WPI and CPI will remain elevated in the months ahead.

Rupee

The rupee was trading stable at Rs 61.52 compared with previous close of Rs 61.53 per dollar after an in-line monetary policy review.

Global Markets

Asian shares withered and the dollar lurked just above its recent lows on Tuesday, as investors awaited confirmation the U.S. Federal Reserve will stay the course with stimulus at its policy meeting this week.

MSCI's broadest index of Asia-Pacific shares outside Japan was down about 0.3 percent in late trade and Japan's Nikkei stock average gave up 0.5 percent, but ended off its session lows.

European markets were steady with CAC, DAX and FTSE adding 0.1-0.4%.

Sectors & Stocks

All the sectoral indices closed in the green with gains of atleast 0.5%.

Bankex was the top gainer among the sectoral indices on the BSE up 4.4% followed by Realty, Metal and Auto indices up 2% each.

 PSU, Power, Consumer Durables, Health Care, Capital Goods and Oil and Gas indices up 1% each.

Among Sensex-30, in the banking segment, ICICI Bank, HDFC Bank and SBI were up 3-6%.

Maruti Suzuki was up 8.2% after reporting a better than expected net profit at Rs 670 crore for the quarter ended September 2013 (Q2FY2014), driven by strong growth in exports, favorable exchange rate and cost control measures. Analyst on an average had expected profit of Rs 551 crore for the quarter. The company had reported profit of Rs 227 crore in year ago quarter.

Sun Pharma was up 2% after the company said it has addressed the United States Food and Drug Administration’s (USFDA) concerns about quality control breaches at a U.S. subsidiary that was shut down by the regulator for three years because of manufacturing flaws.

Other Sensex gainers include, Tata Steel, Mahindra & Mahindra, Hero MotoCorp, Hindalco, SSLT, Hindustan Unilever, Tata Power and HDFC adding gains of 2-4%.

BHEL down 0.1% was the only loser among the Sensex-30.

The market breadth was very positive on the BSE, 1,291 stocks advanced while 1,095 stocks declined.

Expert group on new bank licences to hold 1st meeting on Nov 1

There are 26 applicants for new bank licences

A high-level panel chaired by former RBI Governor Bimal Jalan that will scrutinise applications for new bank licences will hold its first meeting on November 1.

Other members of the high-level advisory committee (HLAC) are former RBI Deputy Governor Usha Thorat, former Securities and Exchange Board of India Chairman C B Bhave, and Nachiket M Mor, Director of the Central Board of Directors of RBI, Governor Raghuram Rajan said.

The committee will hold its first meeting on November 1, Rajan said today in the RBI's Second Quarter Review of Monetary Policy 2013-14.

Rajan, who took charge as the 23rd Governor on September 4, said at the time the RBI plans to issue new bank licences around January. Earlier this month, he said the central bank would endeavour to do "as much as possible" before RBI Deputy Governor Anand Sinha, who looks after new bank licences, retires in January.

There are 26 applicants for new bank licences, including Tata Sons, India's biggest business group, and firms controlled by billionaires Anil Ambani and Kumar Mangalam Birla. Among public sector units, India Post and IFCI have submitted applications.

The RBI had issued guidelines for licensing of new banks in the private sector on February 22 and issued clarifications in the first week of June.

In the past 20 years, the RBI has licensed 12 banks in the private sector in two phases. Ten banks were licensed on the basis of guidelines issued in January 1993.

The guidelines were revised in January 2001 based on the experience gained from the functioning of these banks and fresh applications were invited. Kotak Mahindra Bank and Yes Bank were the last two entities to get banking licenses from the RBI in 2003-04.

In the 2001 round of guidelines for new licences, the external committee members were C G Somiah, former government auditor CAG, I G Patel, former RBI Governor, and Dipankar Basu, former head of State Bank of India.

Markets welcome monetary policy; Sensex spurts 305 points

The Sensex and the Nifty surged over 1.5 per cent in the mid-session on Tuesday led by banking, realty, metal and auto stocks amid mixed European cues.

Domestic sentiment was buoyed after the RBI in its second quarter monetary policy review raised the repo rate by 25 bps to 7.75 per cent and cut the MSF rate by 25 basis points. Cut in MSF rate will bring down the cost of short-term funds for banks.

At 1.35 p.m., the 30-share BSE index Sensex was up 305.59 points (1.49 per cent) at 20,875.87 and the 50-share NSE index Nifty was up 101.95 points (1.67 per cent) at 6,203.05.

On the BSE, banking and realty stocks led the Sensex rally and were up 3.53 per cent and 2.35 per cent, respectively, followed by metal 2.27 per cent and auto 1.54 per cent.

Maruti, ICICI Bank, Tata Steel, SSLT and Hindalco were the top five Sensex gainers, while the BHEL, GAIL and NTPC were the only three losers.

Asian shares fell, paring a two-month advance, and European stock-index futures retreated as the Federal Reserve begins a two-day policy meeting.

The Fed is expected to continue its $85-billion-a-month bond-buying programme as the US economy is believed to have been affected by the shutdown caused by the standoff between its President Barack Obama and lawmakers.

A couple of data released by the US last night showed the economy sagging. Factory output in September was lower than forecast and sales of pre-owned homes slipped to a three-month low.

Stoxx 50 was down 12.46 points or 0.41 per cent at 3,022.04, FTSE 100 was up 4.48 points or 0.07 per cent at 6,725.82 and DAX was down 7.09 points or 0.08 per cent at 8,978.65.

In the Asian trade, Japan's Nikkei fell 51.13 points or 0.36 per cent to 14,344.90, Hong Kong's Hang Seng was up 4.14 points or 0.02 per cent at 22,810.70 and Australia's S&P/ASX 200 shed 25.88 points or 0.48 per cent to 5,415.53.

Govt approves 13 FDI proposals worth Rs 1,258 crore

The government has cleared 13 Foreign Direct Investment (FDI) proposals worth Rs 1,258 crore. Foreign investment is considered crucial for economic development of a country and the government has taken several policy decisions to attract foreign investments in various sectors including telecom, tea, pension and petroleum and natural gas.

Meanwhile, India would require around $1 trillion in the 12th five-year plan (2012-2017), to overhaul its infrastructure sector such as airports, ports and highways to boost growth. Further, a rise in FDI will help support the rupee, which depreciated over 15 percent against US dollar in 2013. Despite the government's various efforts to increase foreign investment, FDI during the April-August period of 2013-14 has grown by a marginal 4 percent to $8.46 billion, from $8.16 billion in the first five months of 2012-13, reflecting the need to take more measures to improve the business environment in the country.

Among the major proposals, which have been approved are Shantha Biotechnics (Rs 755 crore), Equitas Holdings (Rs 222.8 crore) and Stork Titanium (Rs 156 crore) among others. Referring to private sector lender Axis Bank’s FDI proposal, finance ministry said that the proposal of Axis Bank, amounting to Rs 6,265.76 crore has been recommended for consideration of the Cabinet Committee on Economic Affairs (CCEA) as the investment involved in the application is above Rs 1,200 crore. The private sector lender Axis Bank had sought the Foreign Investment Promotion Board (FIPB) nod to increase the foreign equity from the existing 49 per cent to 62 percent.

Subsidiary scheme for foreign banks in 2 weeks

The RBI plans to announce the scheme regarding the mode of presence of foreign banks in India within the next two weeks.

The RBI had floated a discussion paper more than two years ago on the subject. Based on the developments surrounding the financial crisis of 2008, it favoured the presence of foreign banks through a subsidiary as against the current system of operating in India through their branches.

In its monetary policy review today, the RBI said that after taking into account the feedback received from stakeholders, a scheme of subsidiarisation of foreign banks in India, guided by the two cardinal principles of reciprocity and single mode of presence, is being finalised.

The wholly owned subsidiaries would be given near-national treatment, including in the opening of branches.

It will not be mandatory for foreign banks set up before August 2010 to convert into local entities but the central bank hopes that the near-national treatment will incentivise the banks to switch to the new model.

The initial minimum paid-up voting equity capital or net worth for a wholly owned subsidiary shall be Rs 500 crore. It is proposed to issue the scheme by mid-November.

Rupee trading at 61.57 Vs dollar

The rupee erased its initial losses and was trading at 61.53 against the dollar at 11.09 a.m. local time.

After opening weak by 14 paise at 61.67 per dollar against the previous close of 61.53, the domestic unit gained strength soon after the RBI second quarter monetary policy review announcement.

The central bank has raised the repo rate by 25 bps to 7.75 per cent and cut the MSF rate by 25 bps to 8.75 per cent. But it has left the cash reserve ratio unchanged at 4 per cent.

Citing urgency to anchor inflationary expectations, RBI had already hinted at hiking the key interest rate in its report on macroeconomic and monetary developments released on Monday, making investors cautious.

RBI study

On Monday, the RBI study of professional forecasters said that the average WPI inflation will climb to 6 per cent from the earlier median expectation of 5.3 per cent. But it has reduced the growth projection for the current fiscal to 4.8 per cent from 5.7 per cent earlier.

The 7.16 per cent government security maturing in 2023 opened higher at Rs 90.56 from Rs 90.50 previously, while its yield rose to 8.69 per cent from 8.66 per cent.

The overnight call money rate opened higher at 9.05 per cent from the previous close of 8.95 per cent.

Apollo Hospitals surges on plan to garner Rs 550 crore from Kohlberg Kravis Roberts

In a bid to repay promoters’ debt and build more hospitals, Apollo Hospitals is all set to garner around Rs 550 crore by inking partnership pact with US-based PE firm Kohlberg Kravis Roberts (KKR). The investment is in the form of a five-year callable security that consolidates existing debt at PCR, the holding company for the Apollo Hospitals Group and initiates a partnership in the healthcare sector across the two firms.

The PE fund will subscribe to the convertible debentures issued by PCR Investments with an option to convert these debentures into equity shares of listed Apollo Hospitals at the end of five years. The promoters also will have the right to buy back these instruments at the end of two years.

Apollo Hospitals, is the leading private sector healthcare provider in Asia and owns and manages a network of speciality hospitals and clinics, a chain of Pharmacy retail outlets across the country, and provides Consultancy Services for commissioning and managing the Speciality Hospitals.

Tax-free bonds of IIFCL, PFC fail to catch retail fancy

State-owned entities India Infrastructure Finance Company (IIFCL) and Power Finance Company (PFC) are struggling to get a bigger share of the household savings in the ongoing tax-free bond offerings. Both are yet to achieve the retail subscription target of 40% of the overall issue size. The issues are offering a few basis points lower rate of interest in select maturities compared with the earlier ones. Also, with a gush of issues having already hit the market, investor appetite has waned.

"Retail investors have already put in their money in the previous issues like those of REC and NHPC," said Anil Rego, CEO and founder, Rights Horizons, a Bangalore-based advisory firm. "Liquidity is a factor here. But a higher rate of interest can be a way of getting them back into tax-saving bond investment."

The IIFCL issue, scheduled to close on October 31, garnered around Rs 515 crore till Monday against the targeted Rs 1,000 crore, or 40% of the overall issue size of Rs 2,500 crore. But the core issue size is Rs 500 crore, with an oversubscription option of Rs 2,000 crore, aggregating to Rs 2,500 crore. In total, the issue has garnered Rs 1,111 crore, surpassing the core size by more than two times. The company, according to a person with direct knowledge of the development, held a meeting on Monday to decide on a possible early closure. But it has decided to wait for the RBI monetary policy to be announced on Tuesday before taking a call on the issue.

Similarly, the PFC issue is expected to run till November 11. It has raised Rs 1,293 crore so far compared with the targeted Rs 1,550 crore. The core issue size here is at Rs 750 crore with an option of over subscription of up to Rs 3,876 crore. It has raised Rs 4,080 crore so far.

"If there is a sharp repo rate hike of more than 25 basis points, future issues are likely to offer higher rate of interest," said Ashish Agarwal, executive director at AK Captial. "Then, both institutional and HNI investors will tend to wait for some time to invest in these bonds.

Retail investors who generally do not take much cognisance of interest rate movements will follow them.

Markets have already factored in a 25 bps rise in repo and a similar cut in MSF," he said.

A retail investor can invest up to Rs 10 lakh in tax-free bonds. PFC offers interest rate of 8.43% annually on 10-year bonds, 8.79% on 15-year issue, and 8.92% on 20-year papers.

IIFCL pays 8.26%, 8.63% and 8.75%, respectively, for the same tenures. In September, Rural Electrification Corporation (REC) had hit the market offering 8.26% for 10-year, 8.71% for 15-year and 8.62% for 20-year maturities. NHPC offered 8.43% on the 10-year instruments, 8.79% on 15-year papers and 8.92% for 20 years.

Market responds to Monetary Policy...

At 11:07 AM, S&P BSE Sensex is 20643.39 up 73 points, while CNX Nifty is at 6,136 up 35 points.

BSE Mid-cap is at 5,928 up 8 points, while BSE Small-cap is at 5,782 down 15 points.

All the sectoral indices are in green on BSE.

Maruti Suzuki, Sun Pharma, SSLT, Dr Reddy's Lab, HUL, Tata Steel and ONGC are up on BSE, whereas BHEL, L&T, SBI, HDFC Bank, ITC, HDFC and Bharti Airtel are showing some weakness.

Maruti Suzuki gained 5.42% after the carmaker posted Rs. 6.7 billion in net profit for the second quarter ended September as against Rs. 2.27 billion profit last year

SRF Ltd has declared interim dividend of 30% i.e. Rs. 3 per share on the paid up equity capital of the company. The scrip is 5.29% down on BSE.

Healthcare major Apollo Hospitals along with US private equity fund Kohlberg Kravis Roberts has signed a partnership to raise Rs. 5.5 billion to repay promoters' debt and build more hospitals. Apollo is 2.28% up on BSE.

Tata Global Beverages raised Rs. 3.25 billion by issuing 3% secured redeemable non convertible debentures (NCD) by way of a private placement. The scrip is 1.17% down on BSE.

The Telecom Commission will discuss Telecom Regulatory Authority of India's clarifications on spectrum price and valuation, and deliberate on the draft merger and acquisition guidelines later this afternoon.

Capital market regulator SEBI (Securities and Exchange Board of India) has directed stock exchanges to include information on the number of active clients of each broker and the percentage of complaints received against active clients in their reports on their websites.

SEBI has simplified the procedure for transfer of securities from the account of a deceased person and raised the threshold limit for such transactions in demat format to Rs. 5 lakh.

Transmission means to the transfer of securities from the account of a deceased holder to that of surviving joint holder, nominee or legal heir.

RBI hikes repo rate by 25 bps; cuts MSF by 25 bps

In Second Quarter Review of Monetary Policy 2013-14 the Reserve Bank of India has decided to :

• reduce the marginal standing facility (MSF) rate by 25 basis points from 9.0 per cent to 8.75 per cent with immediate effect;

• increase the policy repo rate under the liquidity adjustment facility (LAF) by 25 basis points from 7.5
per cent to 7.75 per cent with immediate effect

• keep cash reserve ratio (CRR) unchanged at 4.0 per cent of net demand and time liability (NDTL);
and

• increase the liquidity provided through term repos of 7-day and 14-day tenor from 0.25 per cent of NDTL of the banking system to 0.5 per cent with immediate effect.


Consequently, the reverse repo rate under  the LAF stands adjusted to 6.75 per cent  and the Bank Rate stands reduced to 8.75 per cent with immediate effect. With these changes, the MSF rate and the
Bank Rate are recalibrated to 100 basis points above the repo rate.

RBI Macroeconomic and Monetary Developments for Q2 FY14

"WPI inflation is ruling above the Reserve Bank’s comfort level and may remain range-bound around the current level during H2 of 2013-14," says RBI.

The Reserve Bank of India released the Macroeconomic and Monetary Developments, Second Quarter Review 2013-14. The document serves as a backdrop to the Second Quarter Review of Monetary of Policy 2013-14 to be announced on October 29, 2013.

Highlights:
Growth
Modest improvement in growth is expected in the second half (H2) of 2013-14 following a rebound in agriculture and an improvement in exports. However, a fuller recovery is likely to start taking shape towards the end of the fiscal year on the back of current steps to clear impediments that were stalling projects.
With deceleration in private consumption and fall in investment, overall demand conditions remain weak. However, a good monsoon and pick-up in exports, if sustained, could provide some momentum. At this stage, demand management requires balancing fiscal consolidation with investment support.
Inflation
WPI inflation is ruling above the Reserve Bank’s comfort level and may remain range-bound around the current level during H2 of 2013-14. Moreover, the persistence of high CPI inflation remains a concern.
The good monsoon should have a salutary effect on food inflation, but second-round effects from already high food and fuel inflation could impart upside pressures on prices of other commodities and services.
Other macro-aspects
External sector risks have reduced as CAD is likely to moderate since Q2 of 2013-14. The trade balance has responded to the policy measures taken; exports have picked up and gold imports have declined.
Broad money growth is largely in line with the Reserve Bank’s indicative trajectory and credit growth has accelerated with greater recourse to bank finance by corporates. While financial markets have rallied, near-term uncertainties on account of 'tapering' continue to be a concern.
Overall Outlook
Monetary policy faces an unenviable task of anchoring inflation expectations, amid tepid growth and weak business confidence. It is, therefore, important to craft policy responses so that growth concerns are addressed in an environment of stable prices.
With the normalisation of exceptional liquidity measures under way, incremental calibration of monetary policy will be shaped by changes in the growth-inflation balance, keeping overall macroeconomic stability in consideration. For supporting growth, complimentary action aimed at productivity enhancement, structural reforms and quick project implementation will be needed.

Infosys to settle US investigation into abuse of B-1 visas: Agency

Infosys, India's second-largest IT services company, has reached a settlement that will end an investigation into its use of US visas, Bloomberg reported late Monday night, citing people familiar with the matter.

The settlement with the US Attorney's Office for the Eastern District of Texas could be announced as early as Wednesday, the news agency reported.

InfosysBSE -0.36 % declined to comment.

In a filing with the US Securities and Exchange Commission earlier this month, Infosys had disclosed that it had received a federal grand jury subpoena seeking records related to its sponsorships for B-1 business visas and its use of those visas.

Infosys said it was co-operating with that probe.

Infosys also disclosed that it had set aside $35 million to pay for a potential settlement and was 'engaged in discussions' to resolve the matter.

The Bangalore-based firm has also resolved whistle-blower cases over its use of the visas.

Reserve Bank expects trade deficit to moderate in Q2

Swap facility for FCNR(B) deposits, bank overseas borrowings attracted $ 6.9 billion and $ 4.4 billion

The current account deficit (CAD) is expected to moderate in the second quarter of the current financial year, driven by improvement in the trade balance, said the Reserve Bank of India (RBI)’s macroeconomic and monetary developments second quarter review, issued on Monday.

“India’s CAD widened from 3.6 per cent of gross domestic product (GDP) in the fourth quarter of 2012-13 to 4.9 per cent of GDP in the first quarter of 2013-14. With some visible improvement in the trade balance in the second quarter of 2013-14, it CAD is likely to show a significant correction,” said the review.

Despite a higher CAD in the first quarter, capital inflows were broadly adequate to finance the current account gap, requiring only a marginal drawdown of foreign exchange reserves, it said.

CAUTIOUS OPTIMISM

Despite higher CAD in Q1, capital inflows broadly adequate to finance the current account gap Inflows from foreign institutional investors, negative since end-May, reversed in September Swap facility for FCNR(B) deposits, bank foreign borrowings got $6.9 bn & $4.4 bn, respectively, as of October 25 Despite the US fiscal deal signed on October 17, concerns remain as deal funds US govt only till January 15

It says inflows from foreign institutional investors, which had turned negative since end-May, reversed in September. Besides, pressure on the rupee appears to be abating. Since the introduction on September 10 of the swap facility for foreign currency non-resident account (banks) or FCNR(B) deposits and bank foreign borrowings, $6.9 billion and $4.4 billion had been received under the respective schemes until October 25.

“Although the exact timing of a possible tapering by the Fed remains unclear at present, what is obvious is that market participants have been making adjustments to a new world of potentially less liquidity,” said the review.

The rupee had touched an all-time low of 68.85 to a dollar on August 28 in intra-day trade. It recovered from there due to various steps taken by the central bank. On Monday, it closed at 61.53, compared with Friday’s close of 61.46, due to a fall in domestic stocks and sentiment remaining cautious ahead of RBI's second quarter monetary policy review, to be detailed on Tuesday.

“The (US) Fed’s decision on September 18 to continue with the monthly quantum of asset purchase, stating they will await more evidence of an enduring economic recovery before adjusting their pace, brought significant improvement in market sentiment,” the review said.

The review states that although the signing of the US fiscal deal on October 17 avoided a debt default there, concerns remain as the deal only funds the US government till January 15 and raises the debt ceiling through February 7. Further, contentious debate over spending cuts and entitlement programmes seem likely for several months.

Tata Power records 43% increase in generation in FY13

Tata Power has a total installed capacity of 398 MW in Wind Generation with plants across five states.

Tata Power, India’s largest integrated power utility, announced crossing over 800 MUs from its Wind Power Projects in FY13. In the span of one year, the Company’s wind farms have generated 813 MUs as against 569 MUs in the previous year, recording an incremental generation of 43% in FY13.
This growth is mainly attributed to the Agaswadi wind farms which had an  increased generation of 85 MUs and Poolavadi with 140 MUs. Tata Power has a total installed capacity of 398 MW in Wind Generation with plants across five states Maharashtra, Rajasthan, Gujarat, Tamil Nadu and Karnataka, which are the leading states in promoting wind power generation in India.

Tata Power has adopted the following technologies In order to optimize its operations:
Surge protection module in pitch power supply unit for reducing pitching error and convertor errors
Vacuum type slip ring to increase the maintenance cycle of wind turbines
Air gap monitoring at bearings to prevent bearing failures

Speaking on achieving this milestone, Anil Sardana, Managing Director, Tata Power, said, “Tata Power is developing wind power projects of over 160 MW in India. We are proud to have increased our wind generation capacity by a record of 43%, which proves our commitment towards to generating 20-25 % of our total generation capacity from clean energy sources.”
Tata Power Renewable Energy Limited (TPREL), a 100% subsidiary of Tata Power has recently signed a SPA for acquisition of 100% shareholding in AES Saurashtra Windfarms Pvt Ltd (ASW), a 100% subsidiary of AES Corporation. ASW owns and operates a 39.2 MW wind farm near Dwarka in Jamnagar district of Gujarat. The project which is fully operational since January 2012 has executed a power purchase agreement with GUVNL for sale of the electricity at a tariff of Rs 3.56/kWh for the duration of the project.  The project is registered with UNFCCC as a CDM project and is eligible to receive CERs. The project is also registered under the Generation Based Incentive scheme of MNRE.

The Company international wind presence includes a Joint Venture Company in South Africa with Exxaro, Cennergi (Pty.) Ltd. Cennergi has recently announced financial closure of its 95 MW Tsitsikamma Wind Farm Project and 135 MW Amakhala Emoyeni Wind Farm Project The wind projects will be located in Eastern Cape, South Africa and are expected to achieve commercial operations in 2016. Power Purchase Agreements and Implementation Agreements for these projects were signed with Eskom and Department of Energy, Government of South Africa respectively on May 9th, 2013.
Tata Power is also pursuing new environment friendly technologies and has installed micro turbines to understand their performance in Indian conditions. The purpose of this project is to determine the most cost-effective forms of wind energy which can be installed on rooftops or in remote areas where there is sufficient wind energy. Micro turbines of capacities of 2 kW from Windtronics, 5 kW and 12 kW from WePower and 5 kW from Unitron have been installed at the test bed site.

Repco Home Finance net up

Repco Home Finance Ltd has closed the second quarter ended September 30 with a net profit of Rs 29 crore against Rs 21.4 crore last year, registering a growth of 36 per cent.

Total net interest income increased to Rs 47 crore (Rs 30 crore). For the half year , it earned a net profit of Rs 51.47 crore (Rs 35.61 crore), an increase of 45 per cent.

The income from operations was at Rs 248 crore (Rs 189 crore). The company sanctioned loans worth Rs 844 crore during the half year period against Rs 567 crore in the same period last year, disbursements stood at Rs 760 crore, compared with Rs 496 crore previously.

The gross NPA of the company stood at 1.67 per cent as at the end of September 2013 as compared with 2.12 per cent last year. Net NPA was at Rs 0.92 per cent (1.59 per cent).

Gold may continue to rule firm

Gold prices in the domestic spot and futures market are likely to continue to rule firm as investors and traders look to the US Federal Reserve’s two-day meet beginning today.

The Fed is expected to continue its stimulus programme of pumping $85 billion every month to keep the economy moving. The decision could be taken as the US economy is believed to have been affected by the shutdown caused by the standoff between its President Barack Obama and lawmakers.

A couple of data released by the US last night showed the economy sagging. Factory output in September was lower than forecast and sales of pre-owned homes slipped to a three-month low.

Festive season demand

In India, gold could be in demand in view of upcoming Dhanteras and Diwali, though the usual enthusiasm for buying is reportedly missing. Jewellers are trying to woo buyers with various schemes or offers or discounts.

Rains in various parts of the country are also affecting demand as arrivals of the summer or kharif crop have been delayed. There is also fear that some key crops such as soyabean could have taken a hit due to excess rain.

Other bearish factors

Other bearish factors are funds raising their bearish bets on gold and investors cashing out of gold-exchange traded funds. Gold holdings in SPDR Trust, the world’s biggest exchange-traded fund, were unchanged at 872.02 tonnes on Tuesday morning.

By mid-day in Asia, spot gold rose to $1,356.94 an ounce and gold futures expiring in December at $1,356.80.

In the domestic market on Monday, gold for jewellery (99.5 per cent purity) ended at Rs 31,905 for 10 gm and pure gold (99.9 per cent purity) to Rs 32,095.

On MCX, gold contracts maturing in December could try to top Rs 31,000.

Crude oil may fall

Crude oil prices could drop as US data due later tonight could show that stockpiles could have increased to the levels seen in June.

Brent crude for delivery in December dropped to $109.12 a barrel and US crude to $98.40.

Higher soyabean acreage

The oils and oilseeds complex could come under pressure on favourable weather in South America. Reports showed that soyabean sowing in key Brazilian area was up by eight percentage points compared with the same period a year ago. Rains in Argentina have, on the other hand, improved the prospects of the oilseed there.

The fall could, however, be cushioned by the export orders for US soyabean with China buying 1.15 lakh tonnes and a similar volume heading to an unknown destination.

Chicago Board of Trade soyabean contracts maturing in January ruled at $12.70 a bushel. Crude palm oil for delivery in January on the Bursa Malaysia Derivatives Exchange rose a tad to 2,464 ringgit or $783.50 a tonne.

Bears in action

The grains complex could see bears in action with increase in sowing of wheat crop in Ukraine and Russia and improved weather in South America dragging wheat. The cereal is also seen as over-bought, leading to profit-booking. Prospects of higher production will put pressure on corn (industrial maize).

CBOT wheat contracts to be delivered in December ruled at $6.82 a bushel and corn contracts for the same month at $4.30 a bushel.

Markets open flat ahead of RBI policy

The Sensex has opened higher by 13 points at 20,583 mark and the Nifty slipping by 2 points at 6,102 levels.

Markets have started the trading session on a flat note ahead of the RBI's Monetary Policy review. The Reserve Bank of India (RBI) will announce the second Quarter Review of Monetary Policy 2013-14 today.

The Sensex has opened higher by 13 points at 20,583 mark and the Nifty slipping by 2 points at 6,102 levels.

Analysts broadly expect RBI to raise its repo rate by 25 basis points (bps) and cut marginal standing facility (MSF) by 25 bps.

The market will remain volatile this week as traders will roll over positions in the futures & options (F&O) segment from the near month to November series. The near month October derivatives contract will expire on Thursday.

On the global front, Asian shares wavered in recent ranges and the dollar held not far above its recent lows on Tuesday, as investors awaited the outcome of the US Federal Reserve's policy meeting this week, at which it is widely expected to stay the course on stimulus.

Australian shares shed about 0.3% after surging 1% on Monday to a new five-year high, while MSCI's broadest index of Asia-Pacific shares outside Japan was weaving in an out of positive territory.

Japan's Nikkei stock average gave up about 0.1% but was off session lows, bolstered by data showing consumer spending in Japan jumped in September as shoppers frontloaded purchases before a sales tax increase next year.