Real Estate Intelligence Service, Wednesday, September 09, 2009

IMF suggests earlier recovery; stimulus a prop

IMF suggests earlier recovery; stimulus a prop
Business Standard, September 9, 2009, Page 5

LONDON, Reuters

Economic recovery may come three months earlier than forecast, the head of the International Monetary Fund said, but policymakers warned it may not last if governments reversed stimulus programmes too early.

"For the (global) economy, we have been saying for a year that the recovery will come in the first half of 2010. It might even be a quarter ahead," IMF Managing Director Dominique Strauss-Kahn told Il Sole 24 Ore newspaper.

"We are seeing the end of the tunnel, but we are still in crisis," he said in the interview published on Tuesday.

A document obtained by Reuters on Friday showed the IMF had increased its forecasts for economic activity this year and next. It is due to publish them later this week.

On Tuesday, generally upbeat data from Germany, France and Britain added fuel to the recovery debate, which has sent stocks soaring since March as fears raised by the bankruptcy of Lehman Brothers a year ago proved to be unfounded.

Emerging markets shares hit a new year high, rising to levels last seen before the Lehman collapse, and world stocks in general headed towards a new 2009 peak.

CAUTION

But government and central banks were cautious.

A senior member of the European Central Bank said in an interview published on Tuesday that markets might be reacting too optimistically to recent data.

"An over-reaction to this data is not good, because it could make us forget that governments still face a very significant agenda of reforms. And without completing those reforms we won't return to sustainable paths of growth," ECB Executive Board Member Manuel Gonzalez-Paramo told Spain's Expansion newspaper.

In China, one of the main engines of global growth over the past 10 years, a senior cabinet official said the economy was stronger but recovery was still not solid.

State Councillor Ma Kai said Beijing would continue to implement its policies to stimulate growth, which have included a $585 billion fiscal spending package, tax incentives and what officials have dubbed an "appropriately loose" monetary policy.

INDIA POLICY

It is too early to withdraw the excess monetary accommodation in the Indian banking system until clear signs of growth is well established, a senior international monetary fund official said.

Kalpana Kochhar, deputy director (Asia-Pacific), IMF, said it was holding India’s growth forecast for the current fiscal ending March 2010. It expects Asia’s third biggest economy to expand 5.8 percent in 2009-10 and 6.8 percent in 2010-11.

Stimulus packages to continue: FM

Stimulus packages to continue: FM
Business Standard, September 9, 2009, Page 5

BS Reporter / New Delhi

Indirect tax kitty likely to improve in Q4

Finance Minister Pranab Mukherjee today said the government had no exit strategy for incentives announced as part of the stimulus packages, even as there has been a 28 per cent fall in indirect tax collections till July.

“At the G-20 meeting, we had already said that the world economy is not yet out of the woods and that stimulus packages will continue for some time to help the economy recover,” said Mukherjee after a meeting with chief commissioners of Customs, central excise and service tax.

He further said the government was ready to take improved measures to combat drought, which has affected 272 districts in the country.

“These measures have significant financial implications. The fiscal deficit is presently on the higher side and the government is determined to revert to the path of fiscal consolidation at the earliest,” he added.

Mukherjee said though there was a 28 per cent decline in annual indirect tax collections till July, the situation is expected to improve in the fourth quarter of the current financial year. The government has set a target of Rs 2.7 lakh crore for indirect tax collections during the current year. He said this was the effect of pre- and post-Budget fiscal incentives and slow international trade. “This trend reflects the overall slowdown of the economy and the effect of stimulus measures through reduction of central excise duty rate. Despite such limitations, the Central Board of Excise and Customs (CBEC) will adopt innovative ways of meeting the revenue shortfall,” Mukherjee said in his speech to CBEC officials.

The finance minister also discussed the introduction of the proposed dual Goods and Services Tax (GST) by April 1, 2010. Mukherjee said he would discuss the progress in introducing the tax with state finance ministers at a meeting on September 16.

The minister also said that while there was a gradual thaw in the winter of economic crisis and the early green shoots of economic recovery, the situation was still far from normal. India’s exports to major traditional markets in the developed economies has contracted in the last 10 months.

To combat the downturn in the economy, the government had announced a slew of measures, including reduction in indirect taxes, to put more money into the hands of consumers, Mukherjee said. “In this year’s Budget, in tune with the government’s commitment towards inclusive growth, there have been larger financial outlays in social sectors like health, education and for improvement of rural and urban infrastructure. The deficient monsoon has raised a spectre of drought in large parts of India,” said the finance minister.

Mukherjee said while central excise continued to be the bulwark of indirect tax collection, service tax is the new sunrise area for widening the tax base and improving revenue collection. The role of Customs as revenue generator has diminished, but its role in facilitation of international trade continues to grow.

Stimulus measures stay for now: FM

Stimulus measures stay for now: FM
The Economic Times, September 9, 2009, Page 9

ET Bureau, NEW DELHI

Finance minister Pranab Mukherjee on Tuesday said stimulus needs to be continued as the economy is “just beginning to come out of woods” even as he ruled out any fresh tax cuts to provide relief in wake of drought that has impacted nearly half the country.

“We are constantly reviewing the economic situation. The just concluded G-20 meeting also reviewed the situation... it is not desirable to plan the exit strategy now,” Mr Mukherjee told reporters on the sidelines of the annual conference of chief commissioners and director generals of excise and customs here.

He, however made it clear that the government that faces the challenging task of returning to fiscal consolidation was not prepared to dole out further tax concessions to shore up any demand slowdown in rural India due to drought that has impacted more than 600 districts.

India has so far taken several measures such as cut in cenvat (the median excise duty rate) and service tax and higher spending on infrastructure programme to pump-prime the economy hit hard by the global recession which brought down its growth to 6.8% in 2008-09 as against an average about 9% growth in last three years. Though, the country grew by 6.1% in the first quarter in the current financial year, drought poses a threat to the growth.

The recent G-20 meeting of finance ministers and central bank heads said although the global economy looks brighter than its last meeting in April, the economic stimulus should not be removed until the recovery is well entrenched.

Mr Mukherjee’s statement comes even as country’s indirect tax collections declined by 28% in the first four months (April- July) of the current financial year and direct tax collections grew by a modest 4% in April- August. The minister, however, exuded confidence that the government will be able to meet the current fiscal’s indirect tax collection target of Rs 2,70,000 crore.

“The trend (in indirect tax collections) is a matter of worry and reflects the overall slowdown of the economy and the effect of stimulus measures,” he said

Higher spending on account of stimulus measures and shortfall in revenue collections due to economic slowdown have put pressure on country’s fiscal situation, with its fiscal deficit, which is the difference between the government’s total expenditure and its total receipts less borrowings, ballooning to 6.2%. The deficit is projected to further widen to 6.8 % in 2009-10, on account of these factors.

But, Mr Mukherjee promised to return to the path of fiscal consolidation soon. “The fiscal deficit is presently on the higher side and the government is determined to revert to the path of fiscal consolidation at the earliest,” he said.

Sensex may see modest correction in near term

Sensex may see modest correction in near term
Business Standard, September 9, 2009, Section II, Page 10

BG Shirsat / Mumbai

The index is trading at a P/E of over 19 times.

After trading in the range of 15,100-16,000 during the period between the middle of July and September 7, 2009, the BSE Sensex has finally crossed and closed above the upper band. Not only has the Sensex doubled from its multi-year lows (on March 9), even price to earnings (P/E) has jumped almost 100 per cent from 10.9 times in March to 19.44 times now. The Sensex has outperformed the world markets with only Hang Seng coming close to it with 74 per cent return. The markets in Europe, US and Japan are almost half way through the Sensex rise.

This V-shape rally is attributed to the stimulus packages and the clear mandate to the Congress-led United Progressive Alliance (UPA) in the last general elections. Analysts are expecting a modest correction as the Sensex is trading at a P/E of over 19 times, based on trailing 12 months profits ending June 2009. The one-year forward P/E is at around 17.6, based on earnings expectation of various Indian and foreign broking houses for the financial year 2010. The Sensex is currently trading at a P/E of 14.9 times of estimated earnings for the year 2011. The 15-year average P/E for the Sensex is around 15 times, so it is fully priced.

The net profit of the Sensex companies, based on research reports available in August 2009, is expected to grow by 10.5 per cent in nine months of the current financial year over the net profit earned during the trailing 12 months ended June 2009. The net profit is estimated to grow by 17.9 per cent in 2010-11. However, even at the forward profit for 2010 and 2011, as many as 20 stocks are currently trading above the estimated P/E for those two years. The cheapest stock based on forward earning could be Reliance Industries (RIL), which is trading at a P/E of 11 times of its estimated earnings for 2011.

Equity analysts expect automobile, banks, construction, capital goods, fast moving consumer goods (FMCG) and realty companies to show a modest growth in forward earnings. So, forward P/E ratio is likely to be above 20 times of their forward earnings. The forward P/E of Sensex stocks such as DLF, Tata Motors, Larsen & Toubro, JP Associates, Infosys Technologies and Wipro is over 20-30 times of their forward earnings. Comparatively, the cheaper stocks would be Tata Power, Sterlite Industries, Bharti Airtel, Tata Steel, Reliance Communication, Grasim and ACC.

A Credit Suisse report on the India market strategy expects the Sensex to correct to below 13,000 by January 2010, although the correction may only begin after the October results season. The report indicates that equity markets may come under pressure from inflation-related developments. The correction, however, should prove temporary, lasting only a few months, but investors planning to benefit from the correction should reduce beta by trimming bank, auto, capital goods and real estate stocks in their tactical or short-term portfolio, the report suggests.

An equity analyst at UBS expects fundamentals and liquidity to support higher valuations for the Indian market. Indian stocks are likely to re-rate further over the medium term as positive data points relating to IIP, GDP and quarterly earnings show a positive momentum. The analyst also expects 2010-2011 to fully capture the economic recovery and corporate earnings, thereby pushing the Sensex to around 20,000 by March 2011. He is overweight on steel, power, real estate and IT services sectors. Even Morgan Stanley has revised upward its Sensex target for June 2010 to 17,600 from 17,000. The key drivers for the market could be reforms and infrastructure spending. The Sensex constituents are likely to grow earnings at an annual compounded rate of 15 per cent on an aggregate basis. If growth turns out to be, say, 20 per cent, returns from the market will be significantly superior to what investors have earned over the past 10 years.

Banks see credit offtake on the rise

Banks see credit offtake on the rise
Hindustan Times, September 9, 2009, Page 25

HT Correspondent, Mumbai

The Indian economy is showing signs of revival. And this would mean that credit offtake (demand for loans) is expected to increase. However, according to State Bank of India Chairman O.P. Bhat, a hardening of interest rates would take some time to come.

Giving the theme address during a three-day conference on global banking organised by industry chamber FICCI and the Indian Banks Association (IBA), he said: "We say that we are well positioned to take advantage of the broad based growth that we have been seeing in the economy. But even today, we don't have banks that are large enough to handle the account of very large corporate who still have to take the services of 10 or more banks for one single project," Bhat said.

"Liquidity overhang will not let interest rates harden," he said.

Private banks too are seeing a rise in their credit offtake. "We have seen a good growth in our home loan portfolio in recent months, even as the demand for car loans increases," said Chanda Kochhar, MD and CEO, ICICI Bank, citing reasons such as a fall in interest rates and an increase in job confidence as some of the drivers for this rise.

"As the economy grows people would look at borrowing more," said Naina Lal Kidwai, group general manager and country head, India, HSBC. However, she said interest rates could harden in the near future.

Interest rates have bottomed out, say bankers

Interest rates have bottomed out, say bankers
The Hindu Business Line, September 9, 2009, Page 6

To rise gradually on the back of loan growth picking up.

Our Bureau, Mumbai

Bankers appear to agree that interest rates have bottomed out in the economy and could rise in the coming months on the back of loan growth gathering pace.

At a FICCI-IBA conference on global banking, top bankers unanimously aired the view that interest rates would stay at the current levels for now and edge up going forward.

ICICI Bank views

“Lending rates have bottomed out....gradually interest rates will harden...from here on, we will gradually see credit pick-up taking place and then the rates would harden,” said Ms Chanda Kochhar, Managing Director and Chief Executive Officer, ICICI Bank.

Emphasising that in India, growth is backed by domestic consumption and investment demand, she said her bank has seen growth returning in its home and auto loans portfolios in the second quarter due to improving sentiments in the credit market.

“We will continue to focus on home, auto and infrastructure loan segments. We also expect project finance to pick up,” she said.

According to the HSBC India Chairman, Ms Naina Lal Kidwai, “Rates will remain flat for now but can go up by the end of the year. We will have to see how credit off-take shapes up.”

The IDBI Bank Chairman and Managing Director, Mr Yogesh Agarwal, felt that interest rates will rise after Diwali and that the quantum of increase will depend on credit growth.

HDFC Bank opinions

The HDFC Bank Managing Director, Mr Aditya Puri, too averred that the interest rates had bottomed out. “There is more than enough liquidity in the system now and inflation is being watched. Unless there is a RBI action, I don’t see an increase in interest rates. There won’t be that much treasury profit, but our base growth won’t be affected,” Mr Puri said.

The government securities market appears to have already discounted the fact that interest rates will rise. In the last one month, the yield on the benchmark 10-year G-Sec (6.90 per cent GOI 2019), which closed at a yield of 7.37 per cent, has risen by 34 basis points.

India moves up one spot on global competitiveness list

India moves up one spot on global competitiveness list
The Financial Express, September 9, 2009, Page 1

fe Bureaus, New Delhi

The Global Competitiveness Report 2009-2010, released on Tuesday by the World Economic Forum, ranked Switzerland as the world’s most competitive nation, overtaking the US. The top ten rankings show no significant changes despite the global slowdown. Other than the US, the other two nations to have slid are Denmark and the Netherlands, to 5th and 10th positions, respectively.

India improved on its position by one rank to the 49th slot. “India’s competitive performance continues to exhibit a rather reversed development pattern,” the report said.

The report ranks 133 countries for their competitive strengths. The report says the more competitive a country is, the more prosperity it can provide its citizens. A comparable survey conducted annually by Switzerland’s IMD business school and released in its World Competitiveness Yearbook ranked India at 29th position among 59 countries in 2008.

Among Bric countries, Brazil occupied the 43rd slot, while China and Russia did not figure in the 2008 yearbook. In the latest competitiveness report, on the other hand, China has the best ranking, at 29th place. Brazil occupied the 56th slot and Russia came in at 63 rd .

In terms of individual indices like macro-economic stability, the US is now placed 93 rd; India is at 96th position. The US also scored badly on the financial soundness of its banks. Its 108th place is ahead of countries like Venezuela, Serbia and Vietnam. Similarly, the banking sectors of Britain, Ireland and Iceland have brought up the rear.

The Global Competitiveness Report’s competitiveness ranking is based on a Global Competitiveness Index, developed for the World Economic Forum in 2004. The index is based on 12 parameters that it claims provides a comprehensive picture of the competitive landscape among countries of the world, despite their different stages of development.

These include public institutions, infrastructure, macroeconomic stability, health and education outreach, the sophistication of financial markets and labour markets and innovation. The sum of all these parameters is assumed to set the sustainable current and medium-term levels of economic prosperity.

Among the countries that saw the highest gains was Singapore, which moved up two places to 3rd position. The report came a day before IFC unveils its 2010 Doing Business Report.

Q4 employment outlook up 25%, says Manpower

Q4 employment outlook up 25%, says Manpower
The Financial Express, September 9, 2009, Page 3

fe Bureaus, New Delhi

Job market in India is coming full circle from the time it started going downhill from September 2008 when the Lehman Brothers debacle took place.

This upbeat trend in India is evident in the recent global quarterly study conducted by Manpower which shows an uptick in the job market here as companies reinitiate expansion plans even while things are not going so well in Europe and the US.

According to Manpower survey, the net employment outlook for India stood at 25% in Q4 compared with 19% in Q3 in the calendar year (CY) 2009. The survey was conducted on 5,700 small, mid and large sized employers across seven sectors of which 25% had intentions of hiring in 2009.

‘Seasonally unadjusted’ responses to employment outlook as answered by employers to whether they would increase, decrease, stay neutral or don’t know between Q3 and Q4 2009 stood at 30% versus 36%, 7% versus 2%, 45% versus 56% and 18% versus 6% respectively. Apart from the up in “increase responses” from 30% to 36% between Q3 and Q4 also noteworthy is the “decrease in hiring” responses that dropped from 7% to 2% and “don’t know” responses that dropped from 18% to 6% thus signifying more opportunities for employment in the forthcoming quarter, said Naresh Malhan managing director of Manpower India. Sectorally too there were clear trailblazers of the seven sectors that comprised the survey respondents. The wholesale and retail sector showed significant improvement in net employment outlook from 21% to 34%, services sector rose from 15% to 25% and finance, insurance and real estate sector went up from 11% to 19% between Q3 and Q4 2009.

The fact that these sectors are amongst the largest employers in the country further validates their positive intent expressed in the study. “Transportation and utilities” on the other hand stood at 16% down from 18% last quarter and showed “least optimistic forecast by employers in this sector”.

Globally countries in Asia and the American region are the ones showing positive employment outlooks this quarter. 17 of 35 countries surveyed expect some positive hiring activity in the quarter ahead. Following India, Brazil had the next highest net employment outlook of 21% followed by Columbia, Peru and China at 8%.

Nothing Vedic about it

Nothing Vedic about it
The Financial Express, September 9, 2009, Page 7

Sudipta Datta

The swiftness with which the West Bengal government canned a planned IT project after it hit a land hurdle may have surprised many, but there’s no doubting the fact that with Singur still weighing heavy in the air, no one’s prepared to take chances. Yet, Singur—where some farmers resisted the takeover but many willingly gave away 600 acres for the Tata small car project—now seems a simple plot in comparison with the Vedic Village fiasco. Consider how a 7-star luxury spa was allowed to spread its wings on vested land (meant for public good) after the land and land reforms department reached an out-of-court settlement in 2005 with the promoters, leasing out 44 acres for 99 years for a paltry sum of Rs 97 lakh when the market price was much higher. This is just one of the worms flowing out of the can that was prised open after a mob set fire to parts of the spa on August 23, ostensibly after a soccer game went awry. The incident sparked a chain of events, not least widespread allegations of land grab and price anomalies, finally leading to the scrapping of an IT project coming up next to the spa in which IT majors Infosys and Wipro Technologies were promised 90 acres each—and where Raj Kishore Modi, the jailed promoter of Vedic Village, was a partner.

Explaining the reasons for dumping the IT park, slated to come up over 600 acres, the IT department said “the government does not want to be involved in any illegal activity... the IT department cannot proceed with the project.” Both Infosys and Wipro will surely think twice before they set foot in Bengal.

The whole project including a township was planned over 1,200 acres with the government getting 600 acres free from the private parties with the arrangement that Webel, the nodal IT and ITeS agency in the state, would build the infrastructure in the area. For Infy and Wipro’s 180 acres, the IT majors planned an investment of Rs 500 crore each and at least 10,000 jobs.

So, how will the West Bengal government attract industry and create jobs? If it failed to convince the people of the need to give up land for a landmark car factory at Singur, it appears to have looked the other way as Vedic Village promoters went about acquiring land for the IT and township project using all means and, now as it turns out after the arrest of the arson mastermind Gaffar Mollah, sometimes with strong-arm tactics. A huge stockpile of arms and ammunition was found at the luxurious spa premises.

The silence of Trinamool Congress chief Mamata Banerjee in the Vedic Village incident has been loud and clear. Though she has spoken out about the arms haul, she hasn’t really demanded a CBI probe into the land acquisition process as she is often wont to do over any perceived ruling front government misdemeanour. With allegations flying thick and fast that her party MLAs were close to the Vedic promoters, she says the IT project land should be handed over to farmers.

The IT department has clarified that it explored all available options—land acquisition, land purchase and public private partnership—to acquire land, but in vain; it said that it kept everyone in the loop, and had got the Cabinet nod for the public-private partnership because it needed land desperately, having failed repeatedly to deliver on commitments on land. As soon as the Vedic Village drama began to unfold, the housing and land ministries cried out for scrapping the IT project—the same ministries which had okayed the project months ago.

If the Buddhadeb Bhattacharjee government’s pro-industry image is being dragged through the mud, it’s also because there seems to be a terrible hurry—not the CPM’s strong point—to get things done.

Which is great news for potential investors, but not if the end result is a stillborn project. In Singur, if there was a huge communication gap between the government and villagers, for the IT project next to Vedic Village, the government did not want to get involved till the land was acquired for them by private parties, in this case Modi and another real estate investor Amarnath Shroff of the Diamond Group. It doesn’t seem to have worked. While a section of the government feels that investors should directly buy land from farmers—the Videocon Group and JSW Steel have done that —it’s not an easy process either with landholdings so fragmented.

The government will obviously have to find a way out of the mess.

Ironically, the last week has been one of the most active in recent months for West Bengal industry —there have been investments announced in real estate, hospitality, food processing.

But there’s just 1% of fallow land the government can work on for industry, that too in remote areas of Bankura and Birbhum—that is if it can’t win over farmers to the industry cause. That farmland in West Bengal constitutes 62% of the total land is not a problem because even a small amount of this can host an industrial revival. The problem is that politics has become incredibly messy. The road ahead doesn’t look easy for the Trinamool either.

Country should be spending $100 b on infrastructure: Naik

Country should be spending $100 b on infrastructure: Naik
Hindu Business Line, September 9, 2009, Page 3

L&T chief calls for long-term approach for building power plants.

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“Many projects are not viable for the private sector because there is a lot of social responsibility attached to infrastructure and we need to find innovative schemes to marry both.”
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S. Shanker, Mumbai

His steely resolve to take Larsen & Toubro beyond the competition is obvious. Mr A. M. Naik, Chairman and Managing Director, L&T, speaks of growth in a subdued market.

Excerpts from an interview:

Given the slowdown, where do you see growth coming from, in the near term?

I think the Prime Minister’s 100-day programme has begun to move. How long this will last remains to be seen. Well all I know is that accumulated tenders are coming out, maybe for the next 100 days. How long this infrastructure building lasts depends on the kind of resources the Government can mobilise. With the drought, it is possible that some of the money meant for development plans is being diverted, which I can fully appreciate.

What is your take on the private sector’s role in nation building and the viability of public-private partnerships in general?

We have to get diversified funding for infrastructure projects and there is no question more projects have to be built by the private sector.

Many projects are not viable for the private sector because there is a lot of social responsibility attached to infrastructure and we need to find innovative schemes to marry both.

For example, L&T has finished the Vadodara-Baruch six-lane toll highway. However, the rural roads leading to the highway have to be built by the State. Instead of the Government seeking Rs 1,000 crore as concession charges, we could have been asked to complete the byroads leading to the district headquarters and important towns free of charge. This connectivity would help transportation of agriculture products onto the highway. Development should reach out to the under-privileged.

Which sectors, in your view, could take the lead in the near term?

Infrastructure will grow in the near term. India could do with a 25-year growth plan because we have very little to speak of, compared to even under-developed countries. A lot needs to be done for the next 25 to 40 years.

China continues to spend $150 billion on infrastructure building and has spent over $2.5-3 trillion over the last 25 years. Compared with that, we spend $25-30 billion when we should be spending at least $100-150 billion. Only then will it take 30 years to come up to somewhere near what people want it (infrastructure) to be. So, that is something that is near term but which will be relevant for the long term as well.

Next is power. It is unfortunate that over 50,000 MW of power equipment has been ordered by the Indian private sector to China. And why was that? There is only one BHEL (Bharat Heavy Electricals) and hence deliveries will not be on time.

L&T has spent over Rs 3,500 crore to build turbines, boilers and heavy forging shops, besides quite a few associated equipment manufacturing facilities. However, India needs a long-term approach to building power plants.

Since the entire Twelfth Plan requirements of power equipment have been ordered out, we have to see movement away from sub-critical boilers to super-critical and away from Chinese to Indian products. In the olden days, there was only 4,000-5,000 MW of capacity available with BHEL. Today, the public sector company has 10,000-plus MW and L&T 4,000 MW, which can be scaled up to 6,000 MW. But we don’t seem to get orders at this point of time, because of the huge commitments made to China.

What kind of potential do you see from nuclear power?

It will take time. The Indian nuclear power programme, which has got 4X700 MW, has kicked off. We already have received steam generators for two while two others have gone to BHEL. More are expected to follow.

The entry of Areva, Westinghouse and GE will take time. Agreements have to be signed and these will go up to 2011 and thereafter. On the ground, there is potential for four more reactors. Then the 16 to 18 reactors that are to come beyond 2011 to 2020 will take India’s capacity to around 25,000 MW.

As for your shipyard programme, would you take more orders for commercial ships beyond the current level of 10?

We are not taking any more orders for commercial ships. Anyway, the world has seen a great depression in shipbuilding. I think it will take the commercial ship market three to five years to improve.

However, our main purpose was to build a defence shipyard. The bigger ones — the frigates and destroyers and submarines — will be done at Kattupalli, near Chennai, which should be operational in 2011. But at the same time we are ready to build ships today as initial work can always be started at Hazira and when it is comes for assembly, Kattupalli will be ready and possibly waiting for it.

Canara Bank trims home loan rates

Canara Bank trims home loan rates
The Hindu Business Line, September 9, 2009, Page 6

Our Bureau, Bangalore

Canara Bank has reduced home loan rates by 0.25 per centage points for all fresh home loans from September 10, on account of the festival season. The rates for all new home loans up to Rs 30 lakh would be 8 per cent for the first 12 months, 9 per cent for the next four years, and benchmark prime lending rate minus 2.5 per cent subject to a minimum of 10 per cent thereafter, said a press release.

Similar changes have been announced for all new home loans above Rs 30 lakh and up to Rs 1 crore. The revised rates will be 8.75 per cent for the first 12 months, 9.5 per cent for the next four years and BPLR minus 2 per cent subject to a minimum of 10.5 per cent there after. The offer will be valid till December 31, the release said.