Thursday, September 17, 2009
Bull Charge Continues; Nifty Nears 5000
Bull Charge Continues; Nifty Nears 5000
Surya R Kannoth, Mumbai
The Economic Times
Bulls resumed their charge for the second straight session Wednesday sending equity benchmarks to nearly 16-month highs. Expectations of a strong earnings season along with encouraging comments from Fed Chairman about the US economy kept investor sentiment upbeat. Commodity stocks clocked handsome gains making the BSE Metal Index the biggest sectoral gainer.
On Tuesday, US Federal Reserve Chairman Bernanke said the country's recession was "very likely" at an end. Bernanke said there was general agreement among economists that the US would return to growth in the third quarter of this year and continue to pick up in 2010. But he said any recovery would be slower than in previous economic crises, which means unemployment will also be slow to fall. The US jobless rate climbed to 9.7 percent in August, its highest level in 26 years. This spurred stocks across the world.
“The trend continues to remain up and very strong as markets are lacking any huge selling from the FIIs or the domestic players. We were looking for a fresh trigger and one of the triggers is the advance tax numbers and the second could be the earnings estimates for this quarter in the coming days. To add to the good news, Bernanke declared that US recession is very likely over. Banking, metal and auto stocks continue to show strong resilience. The next target for the Nifty is 5100,” said a technical analyst with a domestic brokerage.
Bombay Stock Exchange’s Sensex settled at 16,677.04, higher by 1.35 percent or 222.59 points from the previous close. The index touched a high of 16,700.56 and low of 16,498.59 during the day.
National Stock Exchange’s Nifty moved closer to its next immediate target of 5000. The index ended at 4958.40, up 1.36 percent or 66.3 points. The index surged to a high of 4966.30 after opening at 4894.65.
Broader markets performed in line with bluechips. The BSE Midcap Index climbed 1.45 percent and BSE Smallcap Index rose 1.1 percent.
Hotel stocks were also buzzing with action after the Reserve Bank of India notified that hotel ventures run by the entrepreneurs themselves be taken out of the real estate exposure for banks so that they become eligible for loans on the lines of infrastructure projects. This new relaxation would enable hotels to avail larger credits at better interest rates, which would help to lower the overall cost of such hotel projects. Shares of Kamat Hotels surged 20 percent, EIH Hotels climbed 19 percent and Royal Orchid advanced 12.64 percent.
GAIL (-2.28 percent), Reliance Infrastructure (-1.21 percent), BPCL (-1.06 percent), Hindustan Unilever (-1 percent) and Wipro (-0.82 percent) were the losers.
SEBI'S TRANSPARENCY NORMS MAY CHANGE IPO GAME
SEBI'S TRANSPARENCY NORMS MAY CHANGE IPO GAME
Arun Kumar, New Delhi
The Economic Times
The stock market regulator’s move to create a level-playing field between institutional and other investors by prohibiting companies doing initial public offers (IPOs) from sharing financial projections with research arms associated with the sale arrangers may change the way IPOs are sold to investors, investment bankers say.
Since analysts associated with investment bankers who are selling the issue cannot make financial projection, it would be difficult for the advisors to come up with price estimates even in pre-IPO road shows, said a leading investment banker on condition of anonymity.
The Securities and Exchange Board of India, or SEBI, came out with a new disclosure and investor protection guidelines on September 3, which state that the research report should be only based on the published information as contained in the offer documents which analysts at non-arranging brokerages and retail investors rely on.
Before SEBI’s rule tweak, the market practice was for banks advising companies to share financial numbers with the analysts associated with their research department, which in turn prepare a report making their own future projection in comparison to the peer group. These reports are subsequently shared with institutional investors prior to filing the prospectus. They are not meant for the retail or ordinary investors.
But the new guidelines say that “no selective or additional information or information extraneous to the offer document shall be made available by the issuer or any member of the issue management team/ syndicate to any particular section of the investors or to any research analyst in any manner whatsoever including at road shows, presentations, in research or sales reports or at bidding centres”.
Research houses not associated with the issue and have no access to the company’s financial details can make their own projections based on publicly available information. In the recent NHPC share sale, for instance, CLSA, a unit of France’s Calyon, which was not advising on the issue, said the issue was overpriced in comparison to its peer group.
Some 30 companies, which were planning to file prospectus for public offers by September 30, including Sahara Prime City, Lodha Developers, Emaar MGF, and Godrej Properties, have to decide the prices at which they plan to sell their shares based on the new rules. These companies plan to raise between Rs 3,000 crore and Rs 5,000 crore.
Reaction from investment bankers to the new rule was generally negative, though none were willing to be quoted by name. Reports from analysts at investment banks involved with the share sale help in pricing IPOs, and in arriving at the company’s fund requirements, said another banker and added such a practice is followed in the US.
Based on the investment plan and implementation schedule of the companies, analysts make their future projections and fund requirements, which are used to give a benchmark valuation and arrive at a price band, said a banker. These reports are not shared with ordinary investors, he added.
If under the new dispensation, even indicative projections are not available, how will you price the issue, asked a banker?
The latest move hinders price discovery and provides room for uninformed analysts’ reports to confuse investors, according to investment bankers.
Bankers said that even in case of follow-on public issues, such as those of Rural Electrification Corporation and NTPC, which are planning to sell shares by the end of this fiscal, analysts associated with advisors to the issue couldn’t project earnings. This may distort pricing, said a banker.
Your Parking Space Just Doubled
Your Parking Space Just Doubled
The Times of India (Mumbai edition)
It’s taken six months for the rulebook to be amended, but Mumbaikars now have a reason to cheer. The state government has finally approved the amendment of the Development Control (DC) rules to double ‘off-street’ parking spaces in new housing societies, malls, cinema halls and other important government and private establishments.
The new rules will allow smaller tenements with an area of 225 sq ft in the island city to claim a parking space. In the suburbs, this has been brought down to 450 sq ft from the previous 700 sq ft limit.
More parking has also been made available for hotels, shopping complexes, educational institutes, markets and stadia and clubs. For one, the state has doubled the mandatory parking space in cinemas and multiplexes from the current four percent of the total seats to eight percent. For private hospitals and industrial complexes, it has been doubled to one parking space for every 1,500 sq ft of floor area from the existing 3,000 sq ft. Hotel developers have to provide standard parking space for every 600 sq ft of the total floor area of the establishment. It was initially 1,200 sq ft. (See A home for your car). The notification comes at a time when the BMC is struggling to deal with the parking menace.
“The state’s decision to modify the existing rule 36 of the Development Control regulation has come as a shot in the arm in our efforts to provide sufficient parking space to citizens. However, effective implementation of these rules will be a challenge in the backdrop of the changing urban landscape of the city,’’ said a senior official of the development plan department.
“Developers will not mind constructing more only-parking floors since it also means free FSI,’’ said Niranjan Hiranandani, of Hiranandani Constructions. Civic officials, too, are of the opinion that the amendments will ensure a spurt in construction of multi-storey podiums and other parking facilities by builders, but compliance of the law, they said, will pose a problem.
The state, however, has an uphill task ahead if it. Every day, 400 new vehicles are registered in the city. By 2011, more than 16 lakh private vehicles will ply our roads. Currently, the available road space in the city is only 63.31sq km, of which at least 13.8sq km is lost on account of unauthorised and unplanned parking.
10 developers want to pull out of SEZs; 8 seek more time
10 developers want to pull out of SEZs; 8 seek more time
New Delhi
The Economic Times Mint
The economic slowdown and the problems in acquiring land are making developers re-think their SEZ plans and 10 of them have approached the government for withdrawal of approvals for setting up the tax-free enclaves.
Besides, at least eight SEZs, have sought extension, citing different reasons like problems in acquiring land.
The applications for seeking withdrawal of approvals and extension of validity of clearances will be considered by the Board of Approvals in the Commerce Ministry in its meeting on October five.
Promoters which want to pull out of these projects in the wake of the slow down for commercial space include Gremach Infrastructure Equipments for its proposed project at Kolhapur, ETL Infrastructure Services' project at Kancheepuram in Tamil Nadu and Maharashtra Industrial Development Corporation for a bio-technology SEZ at Jalna in Maharashtra.
Those seeking extension of time include Mumbai SEZ, promoted by Reliance Industries' Chairman Mukesh Ambani and his close aide Anand Jain, Gitanjali Gems, Jubliant Infrastructure and L&T Hitech City, an official said.
The BoA has so far approved one-year extension to 81 developers.
After the economy felt the impact of the global recession from September 2008 the demand for commercial space saw a big erosion.
Indian SEZ policy must adapt to the current socio-political climate
Indian SEZ policy must adapt to the current socio-political climate
Chennai
The Hindu
The Government’s policy of promoting Special Economic Zones (SEZs) as growth engines is tempered with a cautious approach to locating land for SEZ sites, M. Velmurugan, Executive Vice-Chairman, Guidance Bureau, Industries Department said on Wednesday.
Addressing a meeting on ‘Special Economic Zones-Opportunities’ hosted by the Indo-Japan Chamber of Commerce and Industry, Velmurugan said the State policy is against compulsory land acquisition or developing sites that had more than 10 percent area of wetlands.
In fact, one of the main criticisms against SEZ promotion was that wetland ecosystems were being converted for non-farming purposes, he pointed out.
With an aim at avoiding disharmony around a SEZ habitat, the Government also insisted that developers engage in CSR initiatives and earmark jobs for locals at an SEZ site, he said.
According to Velmurugan, Tamil Nadu had the third most number (52) of SEZs in the country after Andhra Pradesh (70) and Maharashtra (57). The highest number of SEZ initiatives were in the IT/ITES segment with 36 global companies making it to Chennai. “In fact, the State continued to receive a number of proposals even during the downturn”, Velmurugan said.
He pointed out that the most outstanding among success stories of global players setting base in Chennai was the rise of Nokia telecom SEZ in Sriperumbudur as its biggest manufacturing unit in the world producing as many as 11 mobile handsets every second.
Since setting up its facility in Chennai after considering options in China and Thailand, Nokia had raised its manufacturing strength by over 12 times to produce 150 million handsets annually, he said. In fact, it is now recognised that the SEZ format is the best business model to compete with China as mobile phones belong to the list of 217 items notified for zero customs duty under the Information Technology Agreement, the official said.
Velmurugan pointed out that unlike the Chinese SEZ experience where majority of investors were non-resident Chinese and Taiwanese, the investor profile in Indian SEZs was diverse.
Chennai
The Hindu
The Government’s policy of promoting Special Economic Zones (SEZs) as growth engines is tempered with a cautious approach to locating land for SEZ sites, M. Velmurugan, Executive Vice-Chairman, Guidance Bureau, Industries Department said on Wednesday.
Addressing a meeting on ‘Special Economic Zones-Opportunities’ hosted by the Indo-Japan Chamber of Commerce and Industry, Velmurugan said the State policy is against compulsory land acquisition or developing sites that had more than 10 percent area of wetlands.
In fact, one of the main criticisms against SEZ promotion was that wetland ecosystems were being converted for non-farming purposes, he pointed out.
With an aim at avoiding disharmony around a SEZ habitat, the Government also insisted that developers engage in CSR initiatives and earmark jobs for locals at an SEZ site, he said.
According to Velmurugan, Tamil Nadu had the third most number (52) of SEZs in the country after Andhra Pradesh (70) and Maharashtra (57). The highest number of SEZ initiatives were in the IT/ITES segment with 36 global companies making it to Chennai. “In fact, the State continued to receive a number of proposals even during the downturn”, Velmurugan said.
He pointed out that the most outstanding among success stories of global players setting base in Chennai was the rise of Nokia telecom SEZ in Sriperumbudur as its biggest manufacturing unit in the world producing as many as 11 mobile handsets every second.
Since setting up its facility in Chennai after considering options in China and Thailand, Nokia had raised its manufacturing strength by over 12 times to produce 150 million handsets annually, he said. In fact, it is now recognised that the SEZ format is the best business model to compete with China as mobile phones belong to the list of 217 items notified for zero customs duty under the Information Technology Agreement, the official said.
Velmurugan pointed out that unlike the Chinese SEZ experience where majority of investors were non-resident Chinese and Taiwanese, the investor profile in Indian SEZs was diverse.
A Healthy Trend
A Healthy Trend
Neha Dani
The Times of India (Mumbai edition)
The proverb "Health is Wealth" in the current scenario has regained meaning even though many working professionals have hectic and strenuous work hours and are finding it difficult to dedicate time to fitness.
Understanding the needs of the buyers, developers are giving many recreational and sports facilities in their projects.
Nirmal Lifestyle's project Lifestyle City is an affordable project, where sports are given importance. Nirmal Lifestyle is coming up with Olympic standard sports infrastructure at their Kalyan project Lifestyle City. Dharmesh Jain, CMD, Nirmal Lifestyle says, "Sports is a key feature in our Lifestyle City project. The whole idea of sports infrastructure was to give people access to and enjoyment of games in their own complex. Such infrastructure can also encourage people to take sports seriously and help to create future sportsmen." Instead of going to a club and spending huge amounts, residents can enjoy their weekends and game sessions with their children.
Lodha Group is focusing on a children's play area with other sports facilities in Lodha Primero, Lodha Goldcrest. The mini cricket ground with amphitheatre style seating offered by Lodha at their project Lodha Aqua will attract kids as well as older enthusiasts. Besides, they also have tennis courts, squash courts, indoor basketball, volleyball, badminton among others.
“Sports provide numerous opportunities to grow socially, emotionally, and physically," says Vishal Jumani, Director, Supreme Universal. Ekta World and Supreme Universal have also given sports enough importance in their project Lake Homes at Powai, which has tennis courts, squash courts, swimming and jogging track.
Going jogging in the early morning is a stress buster and keeps your heart healthy. Today, developers provide tracks where a jogging session is easy.
Mittal Builders have provided amenities like well-equipped gyms in their projects like Mittal Grandeur, Mittal Park among others. Anil Mittal, Director, Mittal builders says, "These amenities are an added factor for working people, as they don't have to go outside."
The changing face of office spaces
The changing face of office spaces
The Economic Times (Mumbai edition)
As the Indian economy continues to grow and Indian companies become more 'global' in nature, one aspect that has changed in sync, are office spaces. "It is not just about the building's exterior design," explains Ajay Kakar, CMO, Aditya Birla Financial Services Group (ABFSG). "Rather, it is the interiors that have now come into focus. The new vibrant trends in interior design are based on integration and transparency," he adds.
Integration is the key here, he explains. From having various office spaces spread over different locations across Mumbai and its suburbs, ABFSG now has almost 1,000 employees operating from a single location, across five floors of a brand new office building, near Lower Parel. The office architecture also plays a binding role in this integration. The design aspect incorporates transparency, through the use of glass cabins, walls and separators. The integration aspect is achieved through the use of vibrant, corporate brand colours across all the floors, explains Kakar. At the same time, the use of common infrastructure facilities, like recreation, communication, canteen, etc., during challenging economic times results in improving cost efficiency, adds Kakar.
On the Andheri Kurla Road, developer Rasesh Kanakia's newest offering, 215 Atrium. "Actually, the project has two neighbouring constructions in its first phase, namely, a four star hotel and office spaces," he elaborates. The hotel's design aspect seems to have rubbed off on the office building, as it has a huge atrium that extends all the way to the top. "215 Atrium is a corporate hub, with the look and feel of a four-star hotel," shares Vishal Doshi, AGM (marketing and business development), at the Kanakia Group. A Singaporean architect designed the interiors and you feel the difference when you enter the premises, points out Doshi. “The Kanakia Group also plans to shift their corporate headquarters to the top floors of 215 Atrium, soon. I think this is the ultimate endorsement a developer can give to his project”, insists Doshi. 215 Atrium will soon be expanded, with two more buildings coming up in the same compound.
Moving from Andheri Kurla Road towards the Aarey Colony Gate, architect Nilesh Barve is at the site of the commercial building, Imperium, a project by Prince Plastics Group, which he feels, "is different". Office spaces have to convey a 'feel good' factor, to its visitors and to those who work there. “We have attempted to do this at the Imperium, through its design form”, especially, the interiors, says Barve. "The design form has to be brought to life by using material that is not artificial and this helps in conveying the right sentiment," he says. Also, it helps in the creative aspect when the client or developer does not want to cut corners, points out Barve. The result then is "Truly, an office space that reflects the new India," concludes Barve.
The Economic Times (Mumbai edition)
As the Indian economy continues to grow and Indian companies become more 'global' in nature, one aspect that has changed in sync, are office spaces. "It is not just about the building's exterior design," explains Ajay Kakar, CMO, Aditya Birla Financial Services Group (ABFSG). "Rather, it is the interiors that have now come into focus. The new vibrant trends in interior design are based on integration and transparency," he adds.
Integration is the key here, he explains. From having various office spaces spread over different locations across Mumbai and its suburbs, ABFSG now has almost 1,000 employees operating from a single location, across five floors of a brand new office building, near Lower Parel. The office architecture also plays a binding role in this integration. The design aspect incorporates transparency, through the use of glass cabins, walls and separators. The integration aspect is achieved through the use of vibrant, corporate brand colours across all the floors, explains Kakar. At the same time, the use of common infrastructure facilities, like recreation, communication, canteen, etc., during challenging economic times results in improving cost efficiency, adds Kakar.
On the Andheri Kurla Road, developer Rasesh Kanakia's newest offering, 215 Atrium. "Actually, the project has two neighbouring constructions in its first phase, namely, a four star hotel and office spaces," he elaborates. The hotel's design aspect seems to have rubbed off on the office building, as it has a huge atrium that extends all the way to the top. "215 Atrium is a corporate hub, with the look and feel of a four-star hotel," shares Vishal Doshi, AGM (marketing and business development), at the Kanakia Group. A Singaporean architect designed the interiors and you feel the difference when you enter the premises, points out Doshi. “The Kanakia Group also plans to shift their corporate headquarters to the top floors of 215 Atrium, soon. I think this is the ultimate endorsement a developer can give to his project”, insists Doshi. 215 Atrium will soon be expanded, with two more buildings coming up in the same compound.
Moving from Andheri Kurla Road towards the Aarey Colony Gate, architect Nilesh Barve is at the site of the commercial building, Imperium, a project by Prince Plastics Group, which he feels, "is different". Office spaces have to convey a 'feel good' factor, to its visitors and to those who work there. “We have attempted to do this at the Imperium, through its design form”, especially, the interiors, says Barve. "The design form has to be brought to life by using material that is not artificial and this helps in conveying the right sentiment," he says. Also, it helps in the creative aspect when the client or developer does not want to cut corners, points out Barve. The result then is "Truly, an office space that reflects the new India," concludes Barve.
Novel malls for showcasing brands
Novel malls for showcasing brands
Priyanka Dasgupta Bhrama
Financial Chronicle
Entertainment World Developers (EWDPL), a partner firm of Mumbai-based Phoenix Mills, is launching a concept called `Treasure Showcase’, which will help Indian manufacturers and emerging brands to showcase their products/brands in a mall environment. EDWDPL is into developing shopping malls, residential town¬ships and hospitality projects.
The company is planning to build 20 malls in 11 states spreading over an area of 1 million sq ft with this new concept by 2011. “In these malls, depending on the kind of market, the area of Treasure Showcase will range from 15,000 to 50,000 sq ft,” said Kush Medhora, chief operating officer, EWDPL.
The entire concept will be built on a revenue sharing basis. “There will be no rent, no CAM, no deposit, no maintenance. With Treasure Showcase, the idea is to enable more Indian products and brands to benefit from modern retail practices, leveraging retail intelligence and a new business/ revenue model. Here emerging brands will rub shoulders with established brands under the same roof. Besides, it will also lead to an increase in footfalls, drawing in consumers who are currently non-mall customers, offering them greater choice,” said Manish Kalani, managing director, EWDPL.
These malls will come up in places like Agra Amaravati, Bangalore, Bareilly, Bhilai, Chennai, Hyderabad, Indore, Jabalpur, Kolkata, Lucknow, Mumbai, Mohali, Nanded, Pune, Raipur, Thiruvananthapuram, Udaipur, Ujjain and Vado-dara in categories ranging like apparel, footwear, electronics, food, accessories, cosmetics, jewellery and home furnishings.
According to Kalani, this will help in promoting consumption, by providing emerging Indian consumers access to a wider bouquet of brands at various price points. “While India’s aggregate consumption is set to quadruple by 2025, the emerging middle class in metros, cities and towns will significantly drive consumption across categories — thus, creating the need for a whole new generation of brands that are young, trendy and affordable,” he said.
The company expects to generate revenues of over Rs 500 crore by 2011 from Treasure Showcase. Nearly Rs 300 crore will be invested in creating and promoting this concept, which would include the cost of real estate. “The whole concept will be based on a transparent / pre-determined margin sharing revenue model,” Kalani said.
Retail boom seen as mall space to touch 120 m sq ft
Retail boom seen as mall space to touch 120 m sq ft
Mumbai
Deccan Herald
India can expect to have nearly 120 million square feet of total mall space by the first quarter of 2011 spread across 350 malls, said a report titled Malls of India.
The latest edition of Malls of India, published by IMAGES Group, which was at the India Retail Forum on Wednesday here, also pointed out that in Mumbai, an additional 67 million square feet of mall space is projected to be added by the first quarter of 2011.
The Research study further reveals that 174 new properties are currently in various stages of planning, construction and leasing across the country’s metros, plus tier I, II and III locations. Currently, there are about 172 large and small malls open in India offering just over 52 million square of space for retail, entertainment and F&B formats, said the Report. North and South India lead in terms of percentage growth of mall count and square foot space, says the report, which also presents extensive details of operational malls and developments currently in various stages of planning, constructing and leasing. The number of operational malls in North zone will increase from the present 79 in September 2009 to 150 by Q1, 2011. Thus, the percentage increase in this zone in number of malls will be 49 percent by 2011.
Within the South zone, Bangalore and Chennai are listed as the most prolific cities, in terms of square feet mall space, with 44 percent and 32 percent of the total 7.2 million square feet existing mall space, respectively. According to the Image F&R projection, the number of operational malls in the South zone will increase from 21 operational malls in September 2009 to 72 by Q1, 2011.The highlight of the development in South is that the total existing mall space of 7.2 million square feet is projected to be more than doubling to touch 18.43 million square feet by 2011.
In the West, Mumbai has been dominating mall development activity and continues to do so, accounting for almost 66 percent of the total 56 existing shopping malls. The report adds that the number of operational malls in West zone will increase from the present 56 as on September 09 to 87 by Q1, 2011.
In the Eastern region Kolkata will dominate the scenario. Out of 16 operational malls in East zone, Kolkata is dominating with 10 quality retail spaces, and will continue to dominate future mall developments, accounting for over 51 percent of the 6.14 million square feet additional mall space. The number of operational malls will be doubling from the present strength of 16 as on September 2009 to 37 by Q1, 2011.
Mumbai
Deccan Herald
India can expect to have nearly 120 million square feet of total mall space by the first quarter of 2011 spread across 350 malls, said a report titled Malls of India.
The latest edition of Malls of India, published by IMAGES Group, which was at the India Retail Forum on Wednesday here, also pointed out that in Mumbai, an additional 67 million square feet of mall space is projected to be added by the first quarter of 2011.
The Research study further reveals that 174 new properties are currently in various stages of planning, construction and leasing across the country’s metros, plus tier I, II and III locations. Currently, there are about 172 large and small malls open in India offering just over 52 million square of space for retail, entertainment and F&B formats, said the Report. North and South India lead in terms of percentage growth of mall count and square foot space, says the report, which also presents extensive details of operational malls and developments currently in various stages of planning, constructing and leasing. The number of operational malls in North zone will increase from the present 79 in September 2009 to 150 by Q1, 2011. Thus, the percentage increase in this zone in number of malls will be 49 percent by 2011.
Within the South zone, Bangalore and Chennai are listed as the most prolific cities, in terms of square feet mall space, with 44 percent and 32 percent of the total 7.2 million square feet existing mall space, respectively. According to the Image F&R projection, the number of operational malls in the South zone will increase from 21 operational malls in September 2009 to 72 by Q1, 2011.The highlight of the development in South is that the total existing mall space of 7.2 million square feet is projected to be more than doubling to touch 18.43 million square feet by 2011.
In the West, Mumbai has been dominating mall development activity and continues to do so, accounting for almost 66 percent of the total 56 existing shopping malls. The report adds that the number of operational malls in West zone will increase from the present 56 as on September 09 to 87 by Q1, 2011.
In the Eastern region Kolkata will dominate the scenario. Out of 16 operational malls in East zone, Kolkata is dominating with 10 quality retail spaces, and will continue to dominate future mall developments, accounting for over 51 percent of the 6.14 million square feet additional mall space. The number of operational malls will be doubling from the present strength of 16 as on September 2009 to 37 by Q1, 2011.
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