27.12.2006

• Great adspend figures
• The first four months of 2007 will see a combined adspend of about Rs. 350 to 400 cr from World Cup and KBC III alone.
• These two programs are billed as the biggest media events of 2007.
• AIFHI
• All India Federation of Horological Industry
• Wrist watches is the second largest consumer durable product in India after mobile handsets.
• The watch industry is dominated by unorganized sector which commands about 62% market share.
• Market size of entry level mobile handset market in India
• Is pegged at Rs. 14,400 cr.
• Heli-tourism
• Helicopters typically fly with a speed of about 175 km per hour. This gives the chance of a clear view from up above the sky.
• There are currently about five major players in the field:
• Pawan Hans Helicopters (State owned) with 33 helicopters
• Deccan Aviation with 15 copters
• Global Vectra Helicop with 15 copters
• United Helicharters with 8 copters and
• Jagson Airlines with 6 copters.
• Royalty on coal – method of collection to be shifted
• The Government is considering a shift to advalorem rates which are likely to be fixed between 20% and 22%. Centre may also permit states to levy a cess over and above the royalty with a permissible limit of 5%.
• The coal royalties are collected at present under the specific rate regime. The Centre fixes the rate of royalty on per tonne basis for three years.
• The new regime is expected to enrich the states by about Rs. 500 cr.
• Multiple levies in telecom sector
• On 23.11.2006, I gave some details about the license fee payable by telecom operators in India.
• Let us re-visit that in view of the statement made by T.V. Ramachandran, Director General of Cellular Operators Association of India.
• The multiple levies include – license fee, spectrum charges, ADC, service tax, entry tax, octroi, stamp duties etc. In addition various civic authorities impose levies on installation of cell towers like the property tax, fire tax, sewerate tax, education cess. The sum total of all these levies would be a staggering 40% or more of the net operator revenue.
• The regulatory levies alone put together will make up about 19 to 28% depending the on the circle of operation.
• Hence the argument for making a single levy.
• But my take on the subject runs like this: Only the regulatory levies can perhaps be clubbed into a single levy. The other levies which may include customs, excise, local levies by civic authorities etc., cannot be clubbed to put forth their argument for a single levy. All other businesses also operate in the same environment. Besides there is a jurisdiction problem of who levies and / or collects what as laid down by the respective statutes. In solving a problem we cannot go on creating some other problem of centre-state funds devolution, departmental turf encroachments etc.
• Repo rate and reverse repo rate hikes done by RBI in 2006
• January: Repo rate hiked to 6.5% from 6.25%; reverse repo rate hiked to 5.5% from 5.25%
• June: Repo rate made 6.75%; reverse repo rate 5.75%
• July: Repo rate made 7%; reverse repo rate 6%
• October: Repo rate made 7.25%; reverse repo rate unchanged at 6%.
• FII registrations grind to a halt in December
• There were 823 FIIs on SEBI rolls by December 2005. By November 2006, they touched 993. There was no registration so far in December.
• FII inflows between 2003 and 2005 was about $9.59 bn.