21.09.2006

Cos run for political cover, insurers refuse to play ball
Insurance cover for investments in third world countries hard to come by in international finance markets
ONGC Videsh first bought a $750 mn political cover for its exposure in Sudan from a state-owned company.
Political risk cover (also called CEND cover – confiscation, expropriation, nationalization and deprivation of assets) typically protects a corporation from its assets being confiscated, expropriated or nationalized by the local government.

Largest home budget pie goes for daily bread
An average socio-economic class household in urban India spends Rs. 1,22 lakh per annum or Rs. 10,204 per month.
Percentage spends are:
36% on grocery
26% on rent and utilities
2.7% on loan repayment
4.1% on savings
With a strong economy and rising incomes, consumer goods are expected to see buoyant demand in the coming 3 to 4 year period. Rural and semi-urban India is expected to play a large part in this demand account for 65% of color television demand, 48% for mobikes, 33% for refrigerators and 11% for cars.

Global liquor brands plan assault with bottled-in-India Scotch
The Indian spirits market size is 120 mln cases per annum.

Bell or EADS; Copter deal to be decided in Dec ‘06
After 2 years of evaluation, the defense ministry may soon decide on the supplier for 197 helicopters for the Indian Army.
The new copters will replace the Chetak and Cheetah helicopters.
The deal is estimated to cost about $500 mln. The government will buy 60 copters off the shelf, while the remaining 137 are to be manufactured by HAL with 100% technology transfer from the chosen company.

Airlines to reap honeymoon bucks
India’s outbound traffic, growing at 20-25%, comprises largely of honeymooners apart frfom leisure and business travelers.

TAG unveils India’s first in-store TV network
An in-store TV network is an advertising platform that enables advertisers to influence consumers within the retail environment.

Dr. Reddy’s bets big on pharma outsourcing
Globally the pharma outsourcing market is estimated at $35 bn
Presently India’s share in this business is about $400 mln and is expected to grow to $1 bn soon.

India’s first stem cell transplant centre to treat killer diseases
LifeCell to launch facility in Chennai
Stem cells are undifferentiated cells that retain the ability to produce an identical copy of themselves when they divide and differentiate into other cell types.

Tax spurt points to profit pick-up
Latest advance tax paid by the corporate sector showed a growth of 30% over last year.
Net direct tax collections have recorded a growth of 37.7% to reach Rs. 70,748 cr in April-Sep 2006-07.

Urea shortage: No food for fields
Urea consumption is going up; but manufacturers are not willing to scale up production, due to the differential pricing in feedstock (natural gas). As against the subsidized price of $3 per mbtu, for the increased production they have to buy it at $12-$13 per mbtu.
An increase of every dollar in price of gas leads to an increase of Rs. 1000 per tonne in the cost of urea.
This year India will import more than 3 mln tonnes of urea.
World trade in Urea is pegged at 26 mln tonnes.

Is India finally flying? Arvind Panagariya
Without rapid expansion of the unskilled labour intensive industry, progress towards reduction and transition to a modern economy will remain far slower than is feasible.
The economy has grown at a phenomenal 19% per annum in current dollars in the last three years.
In 1990-91 the GDP in current dollars was $317 bn. During the last three years it has increased to $800 bn

Exponential e-commerce
The e-commerce industry in India is expected to grow to a size of Rs. 2,300 cr by 2007 agasint the present Rs. 1200 cr.
29% of Indian internet users book airline tickets online and this figure is expected to touch 46% by next year.
Online rail ticket booking stands at 39% of the total bookings.
There are 4.6 mln online banking users in INdia. This figure is expected to touch 16 mln by 2007-08.
E-ticketing penetration is low in India at 17% as against the world average of 49%.
India has 20,000 ATMs as against 300,000 ATMs in US.
PCB industry poised for greater growth
Indian market for electronic products is currently at $25 bn and growing at 30%; is expected to touch $90 bn by 2010.

NTPC plans to triple production by 2017
NTPC plans to increase is generation capacity to exceed 75000 MW by 2017 from its current 26,194 MW.