14 Oct 2010;deccanherald.com:Chennai: Skoda India, a subsidiary of SkodaAuto, Czech Republic and part of Volkswagen Group is developing a car to replace the premium sedan Octavia in the country, a top company official said on Thursday. "We are developing a completely new car, to be successor of Octavia...It will be a car also positioned in the 'C' segment," SkodaAuto India Sales and Marketing Director Thomas Kuehl told reporters here. He said the company engineers are developing the car at their headquarters and it is likely to be rolled out in India by the second half of 2011. Besides the new car, the company's much anticipated Sports Utility Vehicle 'Yeti' would also be out on the Indian roads in four weeks. "Skoda Yeti was displayed in the Auto Expo held (in Delhi) this year.. It will be launched in four weeks time..", he said refusing to divulge further details. "We haven't announced the price of the SUV vehicle..yet we have already got more than 1,000 bookings", Kuehl said. Asked on the pricing of the proposed SUV, he said, "I will discuss the price of the car when we launch it... We will be launching two versions with two litre engines..", he said. Kuel was here to launch the company's upgraded version of popular hatchback 'Fabia' in Tamil Nadu market. The new car which is available at Rs 4.32 lakh (for the 1.2 litre petrol versions) is the latest hatchback offered by the car maker. The company, which sold 14,200 units across all models last year, plans to touch about 22,000 units this year. It is also developing a 'small car'. "Yes we are discussing it.. Teams are working on it in the headquarters.. We are very strong in the power train...Engineers are having discussions what kind of exchange would happen between Maruti Suzuki and Skoda", he said. It has entered into an association with country's largest car maker Maruti Suzuki India to develop the small car. Kuehl said they want to localise the Fabia, which was having a 40 per cent localisation, to 70 per cent by next year and to have 100 per cent localisation in another three years. The company currently has a manufacturing facility at Chakan near Pune and it has adequate capacity to increase production. "It is running only in single shift.. when we it run for three shifts, I think we will be able to achieve 100 per cent localisation then..," he said. Skoda Auto currently retails hatchback Fabia in B plus segment, luxury sedan Laura in C plus segment and premium luxury sedan Superb in the D plus segment. It has 31 per cent, 19 per cent and 30 per cent market share in these segments respectively.
14 Oct 2010;hindustantimes.com:Vienna: OPEC stood poised to keep supply policy intact at a meeting in Vienna on Thursday and ministers said they were not worried yet a weak dollar would drive up the oil price too quickly for a fragile economy to bear. Already on Wednesday OPEC's president Ecuador had said there was a consensus among members of the Organization of the Petroleum Exporting Countries to leave output unchanged. Other ministers reiterated that view as they headed into Thursday's meeting, with Kuwait stating no change was the only likely outcome. Top exporter Saudi Arabia, which has spoken in favour of a $70-$80 price range as ideal for producers and consumers, said the kingdom was still happy with the current oil market, although circumstances could change. "The biggest challenge we have is to keep the oil market as it is today," Saudi Arabian Oil Minister Ali al-Naimi told reporters. He declined to be drawn on a price level that might endanger economic recovery, but said producers were concerned about a possible slide back into recession. "I hope we don't have a double dip. Everybody is working very hard to avoid it." Oil rises, Dollar falls International benchmark US crude has stayed in a broad $70-$80 range for much of this year, but rallied this month to a five-month high above $84 a barrel, pushed upwards by a weak US dollar. The dollar on Thursday dropped to its lowest this year against a basket of currencies as markets anticipated further economic stimulus from the United States, the world's biggest economy and biggest oil burner. A weaker dollar makes dollar-denominated commodities relatively cheap and has been fuelling buying across the asset class. So far oil's gains have been relatively modest -- compared with gold which has hit a series of record highs -- as the dollar impact on oil has been countered by weak market fundamentals of nearly record-high fuel inventories and sluggish demand. Price moderates, such as Saudi Arabia, which is keen to preserve long-term demand for its extensive reserves, would be uneasy if any rally were too rapid. But those, including Venezuela, Algeria, Iran and Libya, which traditionally have sought a higher price have argued a weaker dollar erodes the value of their petrodollars and justifies more costly oil. Algerian Energy and Mines Minister Youcef Yousfi said on Thursday he would like to see an oil price of between $80 and $100 per barrel, while Venezuela's Rafael Ramirez said he favoured $90-$100 for next year. Any decision to keep output unchanged would still leave the group plenty of leeway to adjust supplies informally. Compliance with the record cut of 4.2 million barrels per day (bpd) announced in December 2008 -- when OPEC last formally changed its output policy -- has slipped to 57 percent, according to the latest Reuters assessment. Ministers could have the chance to discuss the situation again in the near future. OPEC President Wilson Pastor of Ecuador has said he had invited ministers to attend another meeting in December in Quito. As part of a wave of celebrations to mark the 50th anniversary of OPEC, which was founded in September 1960, Saudi Arabia is also hosting a meeting in Riyadh next week.
13 Oct 2010;deccanherald.com:Bangalore: Tata Motors, on Tuesday, launched its latest offering — Tata Aria, in Bangalore, claimed to be the first Indian four-wheel drive crossover, with features of a sedan and an SUV blended into a single car. The Aria boasts of certain comfort and safety features such as in-dash navigation system with 400 cities on map, first of its kind by an Indian automobile brand, Tata Motors said. The interior also comprises of leather seats, apart from overhead roof utility bins for the convenience of customers and glove box chiller, again a newly introduced feature. Safety features On safety front, it has an Electronic Stability Programme (ESP), Traction Control System (TCS), Anti-lock Braking System (ABS), Electronic Breakforce Distribution (EBD), disk brakes on all four wheels and six airbags offering protection and stability, Tata Motors Head of Utility Vehicles S G Saksena said. The Aria, with 2.2 litre diesel commonrail powerplant, delivering 140 PS power and 320 Nm torque, is also equipped with Torque-on-Demand System to aid in all-terrain driving. It will be available in eight colours and has four variants, whose price ranges between Rs 12.96 lakh and Rs 15.58 lakh (ex-showroom Bangalore), depending on the variant, Saksena added.
13 Oct 2010;business-standard.com:Vishal Chhabria:Mumbai: The wait for Coal India’s initial public offer (IPO) pricing is finally over, with the government announcing a price band of Rs 225-245, which values the company at Rs 1,54,752 crore at the upper price band. However, the pricing has come as a surprise, and the Street seems divided on this. While the pricing is slightly higher than what most analysts had projected earlier, a few had also pegged the company’s value at Rs 234-344 per share, based on different valuation methods. Last month, most experts and analysts had estimated the IPO to be priced in the range of Rs 200-220. Even after considering that the market (Sensex) has risen 4 per cent since then, the final pricing at Rs 225-245 appears to be higher. At this pricing, the stock’s PE works out to 14.4-15.7 times the company’s 2009-10 consolidated earnings. “The issue is aggressively priced. It would have helped in attracting retail investors if the price had been in the region of Rs 200 a share,” said Mayank Shah, chief executive officer at Anagram Capital. While Coal India’s prospects and fundamentals are good, experts suggest that given the somewhat aggressive pricing, the retail portion of the IPO could now get oversubscribed by a little over one time. They argue that had the pricing been as expected earlier, the IPO could have seen higher retail interest. “Nevertheless, investors can still expect 10-15 per cent returns in the next one year,” Shah added. A benign IPO pricing would have left something for the investors in the near term as well. Meanwhile, Coal India’s IPO has many firsts to its credit. For instance, it is the first one to be accorded a rating of 5/5 by rating agencies, which indicates superior fundamentals compared to any other listed company. The other first is that its IPO, in terms of value, will be the biggest ever India has ever witnessed. The offer, which is opening on October 18, will help the government garner Rs 15,475 crore at the upper price band. This is about 70 per cent higher that Reliance Power’s IPO in January 2008, which raised about Rs 9,000 crore from the primary market. Pricing apart, what places Coal India in a favourable spot is its status of being the world’s largest coal miner and a dominant 81 per cent market share in the country. It has the world’s largest proven coal reserves of 52,500 million tonnes (mt), accounting for almost 48 per cent of India’s total reserves. Its annual production is estimated at 460 mt for 2010-11. Assuming constant production at these levels, the company’s reserves would last for over 100 years.
13 Oct 2010;business-standard.com:Ajay Modi:New Delhi: Foreign institutional investors (FIIs) have raised their stakes in public sector oil marketing companies (OMCs) in the three months ended September 30 - the first quarter after the government decontrolled petrol prices and announced plans to decontrol diesel rates as well. The rise in their stakes is visible in all the three state-run OMCs - Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation (see chart). According to analysts, the increased FII interest notwithstanding, OMCs remain undervalued when compared to their global peers. Valuations may become more attractive with further policy clarity on the sector. The OMCs, which purchase crude oil at market rates, are required to sell diesel, kerosene and LPG at government-capped prices, resulting in losses. These losses are usually compensated by the government through a mix of cash and discounts from upstream companies like Oil and Natural Gas Corporation (ONGC) and Oil India Ltd. The companies do not incur any loss on sale of petrol now, as the government decontrolled petrol prices on June 25 in accordance with the suggestion made by the Kirit Parikh group. “The freeing up of petrol rates helped FIIs to consider this sector more favourably. Their exposure in these companies would have been higher if there was more clarity on the subsidy-sharing mechanism. However, as the government is in no mood to expand its subsidy burden, the only way forward is to make the prices market-driven. As and when the government does that, FIIs will be able to reap gains," said KR Choksey Securities, MD, Deven Choksey. The decontrol resulted in an increase of Rs 3.50 on each litre of petrol. Simultaneously, the price of diesel and kerosene increased by Rs 2 and Rs 3 a litre and on LPG by Rs 35. The move had brought down the OMCs' current fiscal underrecovery projection to Rs 53,000 crore from Rs 75,000 crore, considering an average crude oil price of $75 a barrel. With crude oil prices now hovering at $80 a barrel, underrecoveries are expected to go up again. As of now, diesel continues to be regulated by the government, with the result that companies lose Rs 2 on every litre of diesel. They also lose Rs 15 on every litre of kerosene oil and Rs 188 on every domestic LPG cylinder. In spite of this, share prices of OMCs have appreciated and there is a renewed interest in the sector since June 25. IndianOil touched a 52-week high at Rs 458.9 on September 21, the day BPCL also reached its high of Rs 814.9 a share. The HPCL stock touched its 52-week high on September 15 at Rs 555.45. Though the general market buoyancy is adding to interest in these companies, the government's divestment plans for Indian Oil and ONGC also seem to be working in favour of the government-owned companies, usually considered laggards in the stock market. The government also plans to sell its 10 per cent stake in IOC and five per cent in ONGC.
13 Oct 2010;timesofindia.indiatimes.com:Pankaj Doval:NEW DELHI: A price war is expected to start in the competitive small car segment, ahead of the festive season. Days after Hyundai launched a new version of its i10 compact with only a marginal hike in prices, Skoda on Tuesday intensified the competition further by slashing price of the Fabia hatchback — its entrylevel car — by Rs 67,000 on the petrol variant and Rs 1.1 lakh on the diesel. In April, Huyndai had reduced price of its i20 model By Rs 40,000. The Czech company, part of Euorpe's top carmaker Volkswagen group, said the new pricing is expected to create a stir in the small car market and pump up the volumes of the Fabia by many scales. "We want to increase our stake in the Indian market, and have decided to make a thrust in the small car segment where the maximum volumes are. As part of this, we have gone on a new pricing for the Fabia that makes the car a compelling proposition and pits it aggressively to rivals ," SkodaAuto India director (sales & marketing) Thomas Kuehl told TOI. The Fabia's entry-level model will now cost Rs 4.35 lakh (ex-showroom Delhi) against the previous entry price of Rs 5.02 lakh, while the diesel will now cost Rs 5.4 lakh against the previous price of Rs 6.5 lakh. "We feel that we can make a good impact in the market if our cars are placed in the 3%-5 % price range of what successful models from Maruti and Hyundai are placed at," Kuehl said. The company, however, now gives only a single airbag on the entry model and this does not have a music system. The Fabia, launched by Skoda in early 2008, failed to make any impact, mainly because the model was priced substantially higher than competing models like Maruti Swift and Hyundai i20. Skoda received a further jolt when parent German Volkswagen decided to price its Polo compact below Fabia - being the first instance globally when VW brand was being priced below Skoda. So, Fabia lagged when competing cars from the stable of Maruti (Ritz, new WagonR), Hyundai (i20), Volkswagen (Polo), Ford (Figo) and GM (Beat) caught on. The model managed to sell a poor 2820 units in the six months ending September at an average of 470 cars per month.
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