Reliance Life Insurance may not be able to come out with an initial public offer now, with the regulator IRDA saying that any Indian promoter having more than 26 per cent equity in an insurance venture can reduce its stake only after ten years.
"The IRDA has pointed out that the 6AA provision of the Insurance Act specifies that Indian promoters having more than 26 per cent shareholding shall after 10 years reduce it in some appropriate manner or within such period the central government may decide," IRDA chief J Hari Narayan said when asked what is the regulator's view on the company's IPO plan.
"At the moment they have not finished 10 years but if the central government wishes to reduce the period it is a matter to be decided by the government," he said.
When asked whether Reliance Life has sought reduction in the waiting period (currently 10 years) from the government, Reliance Capital Chief Executive Officer Sam Ghosh said, "I don't want to comment on that."
Reliance Capital is the holding company of Reliance Life Insurance.
Ghosh had said "the funds raised through this divestment would be partly infused into the insurance arm and partly into Reliance Capital."
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Friday, July 10, 2009
Gold prices lower; traders eye bigger falls
Mumbai: India gold prices edged lower on Friday weighed by a strong rupee, but traders awaited bigger falls to replenish stocks for the upcoming festival season, dealers said.
The most active August contract was 0.17% lower at Rs14,457 per 10 grams at 1:31pm. It hit a low of Rs14,436 earlier.
The Indian rupee extended gains for a second day and traders said they would be watching quarterly earnings of companies for cues on economic outlook.
“They all are waiting for good bargains to stock up before festivals,” said a dealer with a state-run bank.
Dealers said a further three percent drop in prices could re-kindle buying interest.
“A decline to Rs14,000 could attract traders,” said another dealer with a private bank.
A series of festivals and auspicious days for weddings is expected to boost gold demand from August-end till the end of the year.
The most active August contract was 0.17% lower at Rs14,457 per 10 grams at 1:31pm. It hit a low of Rs14,436 earlier.
The Indian rupee extended gains for a second day and traders said they would be watching quarterly earnings of companies for cues on economic outlook.
“They all are waiting for good bargains to stock up before festivals,” said a dealer with a state-run bank.
Dealers said a further three percent drop in prices could re-kindle buying interest.
“A decline to Rs14,000 could attract traders,” said another dealer with a private bank.
A series of festivals and auspicious days for weddings is expected to boost gold demand from August-end till the end of the year.
Infy nos beat street, but co stays guarded on FY10 outlook
Infosys Technologies' Q1 FY10 profit after tax dipped to Rs 1,527 crore as against Rs 1,613 crore on a quarter-on-quarter basis. Its revenues declined 3% to Rs 5,472 crore as against Rs 5,635 crore QoQ.
Commenting on the road ahead for the IT bellwether, the management of Infosys Technologies, speaking to Us, said it continues to remain cautious in FY10. They expect operating margins to dip by 1.5% versus 3%.
The Infosys panel included S Gopalakrishnan, Chief Executive Officer and Managing Director; SD Shibulal, Chief Operating Officer; V Balakrishnan, Chief Financial Officer; Mohandas Pai, Member of Board and Director-Human Resource; Ashok Vemuri, Senior Vice-President, Member Executive Council and Head-Banking Financial, Services and Insurance; BG Srinivasan, Senior Vice-President, Member Executive Council and Head-Manufacturing; and Subash Dhar, Senior Vice-President, Member Executive Council and Head-CME.
Speaking on the company’s rupee guidance which has come in lower than the dollar outlook, Gopalakrishnan said the guidance at the lower end has surely been increased, but remains the same at the higher end. “However, the range has narrowed. In the short-term, we expect the volatility or uncertainty to continue. But on a medium- to long-term basis, there is confidence."
According to Balakrishnan, things have changed for the full year. “Earlier, in terms of constant currency, we said guidance would be either flat or see a 4% decline. Now, we are talking about a 3-4% decline. We want to be cautious on FY10 guidance as the markets are still unstable."
On operating margins:
This quarter, Balakrishnan sees operating margins coming down by 150 bps (1% = 100 bps) instead of the earlier 300 bps. However, he said, the margins will improve in the next three quarters. He expects operating margins to come in around 31.5%. “If you look at last year, our profit before interest and tax (PBIT) was 33.2%, so probably it will be 31.5% this year.”
On tax rate:
The company said the effective tax rate for Q1 FY10 is 20%. Balakrishnan believes it will be 20% for the full year because of improvement in margins as compared to 17% in Q4 FY09. "That will probably go up to around 19-20% for the full year.”
On pricing:
Shibulal said the pricing environment continues to be challenging. A client survey showed that 60% respondents expected a protracted recovery, which would start from March 2010 onwards.
On the national ID project:
Balakrishnan said the company will bid for the government’s ID project.
Commenting on the road ahead for the IT bellwether, the management of Infosys Technologies, speaking to Us, said it continues to remain cautious in FY10. They expect operating margins to dip by 1.5% versus 3%.
The Infosys panel included S Gopalakrishnan, Chief Executive Officer and Managing Director; SD Shibulal, Chief Operating Officer; V Balakrishnan, Chief Financial Officer; Mohandas Pai, Member of Board and Director-Human Resource; Ashok Vemuri, Senior Vice-President, Member Executive Council and Head-Banking Financial, Services and Insurance; BG Srinivasan, Senior Vice-President, Member Executive Council and Head-Manufacturing; and Subash Dhar, Senior Vice-President, Member Executive Council and Head-CME.
Speaking on the company’s rupee guidance which has come in lower than the dollar outlook, Gopalakrishnan said the guidance at the lower end has surely been increased, but remains the same at the higher end. “However, the range has narrowed. In the short-term, we expect the volatility or uncertainty to continue. But on a medium- to long-term basis, there is confidence."
According to Balakrishnan, things have changed for the full year. “Earlier, in terms of constant currency, we said guidance would be either flat or see a 4% decline. Now, we are talking about a 3-4% decline. We want to be cautious on FY10 guidance as the markets are still unstable."
On operating margins:
This quarter, Balakrishnan sees operating margins coming down by 150 bps (1% = 100 bps) instead of the earlier 300 bps. However, he said, the margins will improve in the next three quarters. He expects operating margins to come in around 31.5%. “If you look at last year, our profit before interest and tax (PBIT) was 33.2%, so probably it will be 31.5% this year.”
On tax rate:
The company said the effective tax rate for Q1 FY10 is 20%. Balakrishnan believes it will be 20% for the full year because of improvement in margins as compared to 17% in Q4 FY09. "That will probably go up to around 19-20% for the full year.”
On pricing:
Shibulal said the pricing environment continues to be challenging. A client survey showed that 60% respondents expected a protracted recovery, which would start from March 2010 onwards.
On the national ID project:
Balakrishnan said the company will bid for the government’s ID project.
Calls for the day 10th july
RESEARCH -Nifty (FUT) R-4110/4145/4225 S-4070/4035/3995; Sensex (CASH)
R-13875/13995/14230 S-13760/13640/13520; MARKET OUTLOOK: VOLATILE
9.15
9:46 AM 7/10 RESEARCH -Nifty (FUT) R-4110/4145/4225 S-4070/4035/3995; Sensex (CASH) R-13875/13995/14230 S-13760/13640/13520; MARKET OUTLOOK: VOLATILE
11:32 AM 7/10 RESEARCH : INTRADAY CALL ( CASH ) : BUY GESHIP ABOVE 225 TGT 232 SL 222
12:27 PM 7/10 RESEARCH : INTRADAY CALL (CASH) : BUY SHIPPING CORP ABOVE 121 TGT 126 SL 118.50
1:17 PM 7/10 RESEARCH- INTRADAY CALL (CASH) : BUY TATASTEEL ABOVE 374 TGT 385 SL 368
2:29 PM 7/10 RESEARCH:INTRADAY CALL ( CASH ) : SHORT SELL IVRCLINFRA BELOW 333 TGT 316 SL 338
R-13875/13995/14230 S-13760/13640/13520; MARKET OUTLOOK: VOLATILE
9.15
9:46 AM 7/10 RESEARCH -Nifty (FUT) R-4110/4145/4225 S-4070/4035/3995; Sensex (CASH) R-13875/13995/14230 S-13760/13640/13520; MARKET OUTLOOK: VOLATILE
11:32 AM 7/10 RESEARCH : INTRADAY CALL ( CASH ) : BUY GESHIP ABOVE 225 TGT 232 SL 222
12:27 PM 7/10 RESEARCH : INTRADAY CALL (CASH) : BUY SHIPPING CORP ABOVE 121 TGT 126 SL 118.50
1:17 PM 7/10 RESEARCH- INTRADAY CALL (CASH) : BUY TATASTEEL ABOVE 374 TGT 385 SL 368
2:29 PM 7/10 RESEARCH:INTRADAY CALL ( CASH ) : SHORT SELL IVRCLINFRA BELOW 333 TGT 316 SL 338