21 July 2009;dailypioneer.com:New Delhi: Essar Oil on Monday reported over four-fold increase in net profit in the first quarter of current year at Rs 169 crore on back of foreign exchange gains. “Last year we had a foreign exchange loss of Rs 258 crore but in Q1 of the current year we had a net foreign exchange gain of Rs 166 crore. So there was a gain of Rs 424 crore,” Essar Oil CEO and Managing Director Naresh Nayyar told the news agency from Mumbai. Essar Oil Ltd has reported strong financial results against the backdrop of volatile crude prices and weak product margins. The company has reported a 104 per cent rise its EBITDA for the first quarter of 2009-10 compared to the first quarter of the last financial. The EBITDA for Q1 FY 2010 stood at Rs 667 crore compared to Rs 326 crore during Q1 of FY 2009. The Profit After Tax (PAT) during the same period stood at Rs 169 crore compared to Rs 30 crore, up by more than 450 per cent . Gross turnover for the first quarter of FY 2010 stood at Rs 7,895 crore. The company earned $6.74 on processing every barrel of crude oil against a gross refining margin of $9.15 a barrel in Q1 of previous year. Nayyar said the company’s Vadinar refiner in Gujarat is currently operating at 14 million tonnes, capacity utilisation of 133 per cent. It also has 1,252 petrol pumps on ground.
21 July 2009;economictimes.indiatimes.com:George Smith Alexander & Lijee Philip:MUMBAI: Fiat India Automobiles, a joint venture between Tata Motors and Fiat, is close to finalising a loan of $510 million — about Rs 2,458 crore at current exchange rates — for its capex and working capital programmes. The loans include a rupee term loan, a working capital loan and an export credit agency (ECA)-backed overseas loan, according to people close to the development. Fiat India Automobiles, a 50:50 joint venture formed in 2007, manufactures Fiat and Tata cars and also produces transmission sets and engines. The term loan of Rs 1,000 crore has a door-to-door maturity of six years while the ECA loan of euro 130 million (around Rs 900 crore) has a door-to-door maturity of eight years. The working capital loan of Rs 600 crore has a tenure of one year, said people familiar with the matter. Citi was the sole arranger for the loans. The rupee term loan and the working capital loan were given by State Bank of India, IDBI Bank, Punjab National Bank and Union Bank of India. When contacted, a Fiat India spokesperson said: “The company is discussing and finalising financing proposals with bankers to fund the company’s originally planned operations. There is no change in production capacity.” The original funding plan of 1:1 between rupee loan and ECA was subsequently revised to 2:1 on the back of rupee liquidity, said sources. The benefit of an ECA-led loan is that because of the guarantee that typically comes in such a case, the interest cost on the loan comes down drastically and the borrower is able to get a longer tenure loan. However, the interest costs on these loans are not known. The Tata-Fiat JV plans to invest close to Rs 4,020 crore in its Ranjangaon facility near Pune. By 2012, the capacity of the Ranjangaon plant would be expanded to two lakh cars, three lakh diesel engines, and three lakh spare parts and accessories per annum. At present, the plant, which makes the Fiat Palio, the Grande Punto and the Linea in the B and C segments, has the capacity to produce one lakh cars and two lakh engines. The plant also has a production capacity of 1.3-litre multi-jet diesel engines, 1.2-litre and 1.4-litre fire gasoline engines and transmissions. Fiat’s 1.3-litre multi-jet diesel engines, 1.2-litre & 1.4-litre fire gasoline engines and C549 transmission machinery which powers the current range of cars. Apart from Fiat cars, the Pune facility rolls out Tata passenger next generation cars. The JV has an equal representation of five members from the two partners. While Tata MD Ravi Kant will be the JV chairman, the vice-chairman will be Alfredo Altavilla, the CEO of Fiat Powertrain Technologies and senior V-P (business development) of Fiat Group Automobiles. Rajeev Kapoor, brought in from Hero Honda, has been appointed the president and chief executive officer of the JV and is in-charge of the operations of the new entity and reports to the board of directors of the joint venture. The distribution and service of Fiat-branded cars in India will continue to be managed by Tata Motors, in line with the agreement signed in March 2006.
20 July 2009;economictimes.indiatimes.com:Chittaranjan Tembhekar:MUMBAI: Over four lakh consumers of piped cooking gas (Piped Natural Gas or PNG) and two lakh CNG consumers, who mainly use it for their vehicles, across the city, will have to pay Rs 1.78 and Rs 2.95 more on each consumed unit of standard cubic meter (scm) and kilo gram (kg) respectively. Restaurant and hotel owners are meeting next week to decide on increasing the prices in their menu cards. Mahanagar Gas Ltd (MGL), the metro’s sole PNG and CNG supplier, has effected the hike for its consumers across Mumbai , Thane, Mira-Bhayander and Navi Mumbai from Saturday, July 18. While PNG prices have been hiked by 15%, the hike in CNG is 14%, said Neera Asthana, MGL’s spokesperson. The old prices of PNG and CNG in Mumbai were Rs 11.82 per scm and Rs 21.70 per kg respectively. At present, PNG is not being supplied in Navi Mumbai. Chandrahas Shetty, expresident and advisor of Ahar, an association of over 6,000 restaurants and hotels in Mumbai, said their core committee will be meeting next week to decide on a hike in prices in menus, following a hike in prices of grains, vegetables and now PNG and CNG both. According to MGL, the prices have increased following a substantial increase in gas purchase cost and other non-gas costs. “The price of PNG was kept more or less the same for the past 7 years. Similarly, the price of CNG remained more or less the same for the past 4 years. However, during this period, the nongas costs have increased tremendously thus compelling MGL to hike rates,’’ said a company statement. MGL officials have clarified that though the gas costs had increased by more than three times, the MGL is increasing the selling price of CNG and PNG by only 14% and 15% respectively. CNG costs up too: The wallets of Mumbaikars might be further burdened as 56,000 CNG taxi and around 1.5 lakh CNG autorickshaw drivers are now demanding a hike in their basic fare, taxis, from Rs 13 to Rs 15 (per km tariff from Rs 8 to 9) and autorickshaws from Rs 9 to Rs 11 in view of the hike in CNG prices. A L Quadros, general secretary of Mumbai Taximen’s Union, has written to the state, demanding a hike in the taxi’s tariff in case of a hike in CNG prices as according to him it will affect their business. “We are taking out a morcha to the Mahanagar Gas office on Tuesday,” he added.
20 July 2009;economictimes.indiatimes.com:Rajeev Jayaswal:NEW DELHI: An international expert will examine the pricing formula proposed by Reliance Industries (RIL) for the crude oil produced from its D-6 block in the Krishna-Godavari basin, an oil ministry official said. RIL has proposed a pricing formula for its KG-D6 crude oil that is benchmarked with Bonny Light oil—a high-grade Nigerian crude oil—with a 2% premium. At present, its consumers Hindustan Petroleum (HPCL) and Chennai Petroleum (CPCL) buy the KG basin crude in spot sale at a fixed discount of $5.34 a barrel on Bonny Light, a company source said. A Reliance Industries spokesperson declined to comment on this issue. “A 2% composite premium over Bonny Light quotation would be added to reflect the quality differential between the two crude oils,” RIL said in a letter to the oil ministry. RIL can sign term sale (long-term contracts) for KG crude with refiners such as HPCL and Chennai Petroleum only after the government accepts its pricing formula. The oil ministry has requested its Petroleum Planning & Analysis Cell (PPAC) to engage the services of an international pricing expert to examine Reliance’s pricing formula, a ministry official said, requesting anonymity. PPAC is an expert arm of the ministry. The formula is meant for valuation of crude oil produced from New Exploration Licensing Policy (Nelp) regime, the official said. Valuation of the crude, undertaken through an arm-length process, is required to determine cost recovery, profit petroleum (government’s share of profit) and royalty, he added. Earlier, RIL had engaged global consultants who had benchmarked the D6 crude oil to the Tapis crude of Malaysia. It had invited expressions of interest from refiners such as HPCL, CPCL, Bharat Petroleum, IndianOil and Essar Oil for spot purchase. But the government-owned oil companies rejected the Tapis benchmark due to their poor pricing experience with that benchmark in the past. Later, Bonny Light was accepted as the benchmark. But only HPCL and CPCL agreed for spot buying. They bid a price of Bonny Light with $9.43 a barrel discount, which was not acceptable to RIL. Reliance offered $1.4 a barrel discount, but they finally settled for a discount of $5.34 a barrel, sources in RIL said. RIL commenced oil production from KG-D6 basin on September 17, 2008, with an initial production of 5,000 barrels per day.
Tatas threaten to scrap Vista electric launch on loan delay
20 July 2009;business-standard.com:London: Tata Motors has threatened to scrap its plan to launch Vista electric cars in the UK if it does not receive a £10 million loan from the British government soon, The Observer reported today. “The company is furious after being told by officials from (Secretary of State for Business, Innovation and Skills) Lord Peter Mandelson’s business department that it needed more time to find out if the venture will be considered for the loan — taking the total wait to six months,” it said. In April, Tata Motors registered its expression of interest to apply for the £10 million loan to help launch the Vista electric vehicle, which was unveiled at the Geneva Motors Show this year, and build an assembly line for it in the UK. Last Tuesday, the company was told that it would take another eight weeks for the business department to decide whether it had met the necessary criteria and can be considered for the loan, according to The Observer report. The report said executives of Tata Motors will meet Ian Lucas MP, who oversees the £2.3-billion car assistance package, and deliver a petition signed by senior managers from Tata Motors’ R&D centre, TMETC, based at Warwick University, which helped design the car. No money has been released by the government from its $2.3 billion package, unveiled in January. It is made up of loan guarantees and loans for car makers wanting to invest in fuel efficient technologies, the report said. Tata Motors remain in deadlock in talks with the department over securing support for luxury cars Jaguar Land Rover.
17 July 2009;business-standard.com:Mumbai: The scrip opened at Rs 84.70, touched a low of Rs 84.10 and zoomed to a high of Rs 94. The stock is now trading at Rs 91, up 12% from the previous close. The counter has seen heavy trades of 141,366 shares on the BSE as compared to the two-week daily average traded volumes of Rs 59,317 shares in the first half an hour of trading session. The company has posted a 101% surge in net profit for the quarter ended June 2009 to Rs 40.75 crore as compared to Rs 20.24 crore in the corresponding quarter, a year ago. Sales also showed improvement , it rose by 5.72% to Rs 897.67 crore.
