Mumbai: Private sector lender HDFC Bank Ltd on Tuesday raised its prime lending rate or PLR by 75 basis points to 16%. This is the second PLR hike by the bank in less than two weeks.
On 20 June, the bank had hiked its PLR by 25 basis points to 15.25%. One basis point is one-hundredth of a percentage point. PLR is the rate at which a bank lends to its most credit worthy customers.
HDFC Bank has also increased its deposit rates by 50 to 100 basis points across maturities.
Other banks that reviewed their PLR and deposit rates include IDBI Bank Ltd and Bank of India.
IDBI Bank has raised its rate by 50 basis points to 13.75%. It has also increased its term deposit rates by 25 to 75 basis points across maturities with effect from 4 July. Bank of India has revised its deposit rates by 25 basis point to one percentage across tenures effective 2 July.
Indian industry shopping spree slowing
New Delhi: The Indian corporate sector has slowed its shopping spree, according to data released by Thomson Reuters, reporting a 28% drop to $32.8 billion (Rs1.4 trillion) in activities related to merger and acquisitions (M&As) for the first half of 2008.
With deals totalling $5.9 billion, health care sector was the most active industry, followed by the materials and energy sector.
Even though domestic M&A activity was up by 47.5% compared with the same period last year, it could not compensate for the massive decline in cross-border deals that fell to $21.1 billion in 2008, against $39.4 billion in the first half of 2007.
The biggest component of the inbound deal volume was the $4.6 billion acquisition of Ranbaxy Laboratories Ltd by Tokyo-based Daiichi Sankyo Co. Ltd. The largest cross-border outbound deal was the $2.3 billion buyout by Tata Motors Ltd of Jaguar and Land Rover, the two iconic British brands owned by Ford Motor Co.Bhuma Shrivastava
SP agrees to back UPA, working on modalities
New Delhi: Mulayam Singh Yadav’s Samajwadi Party, or SP, is understood to have agreed to back the Congress-led ruling United Progressive Alliance, or UPA, to rescue the Indo-US civilian nuclear deal.
A person close to negotiations between the SP and the UPA said the party is yet to decide on the details of the political realignment, which is taking shape after the Left threatened to withdraw its support to the ruling coalition over the nuclear pact.
But the party, with a base mainly in the northern state of Uttar Pradesh, is unlikely to seek a ministerial berth to avoid ruffling anyone’s feathers in the federal dispensation, the person said on condition of anonymity.
“It now wants to get into the orbit of power, not the orbit of governance,” this person said. “The modalities and the nitty-gritty of the give-and-take arrangement will be worked out in a few days,” he added. The SP, which may not immediately make public the agreement with the Union government, is expected to hold formal talks with the Congress “as soon” as a meeting of the United National Progressive Alliance (UNPA) gets over on 3 July, the person said. The SP is the main constituent of the so-called third front.
The head of the Congress media cell, Veerappa Moily, refused to comment on the issue when contacted, calling it “speculation.” Railway minister and Rashtriya Janata Dal chief Lalu Prasad said the SP is with the coalition, adding: “The government will survive and the (nuclear) deal will go through.”
The Left, meanwhile, will, “decide its future strategy on the nuclear deal on 4 July,” Communist Party of India (Marxist) general secretary Prakash Karat said Tuesday.
On a day of frenetic political activity, Prime Minister Manmohan Singh called on President Pratibha Patil to discuss the political situation. The 50-minute meeting, according to a Rashtrapati Bhavan press release, dealt with national and international issues, including the G-8 summit in Japan next week, which the Prime Minister is scheduled to attend.
The support of the SP, which has 39 seats in Parliament, is crucial for the government which will be left with only 228 seats in case the Left pulls out. It needs 272 to remain in power. Ruhi Tewari and Krishnamurthy Ramasubbu
Citibank’s India profit doubles to Rs1,804 crore
Mumbai: Citibank NA, the banking arm of global financial services firm Citigroup Inc., on Tuesday reported that net profit from its operations in India doubled in the last financial year, buoyed by higher fee income.
Net profit surged to Rs1,804 crore for the year to March, from Rs900 crore a year ago. Net profit for the group in India rose 65% to Rs2,596 crore for the year, from Rs1,575 crore in the previous fiscal.
India is one of the largest contributors to Citibank’s Asia-Pacific earnings that account for 25-30% of the bank’s global profits.
“The profit has come from a diversified set of businesses such as transaction services, fixed income, treasury and capital markets activities, and consumer banking,” said Sanjay Nayar, chief executive officer, Citi India, and area head for Sri Lanka, Bangladesh and Nepal.
Fee income rose 82% to Rs2,446 crore from Rs1,346 crore , on the back of rising contributions from the bank’s foreign exchange business and commission income. A Rs66 crore profit on the sale of premises also contributed to the profit.
Nayar, however, said the income from consumer banking has been “under pressure due to the existing environment in the market”.
The bank’s non-banking finance unit, CitiFinancial Consumer Finance India Ltd, or CitiFinancial, posted a fall in net profit to Rs12 crore from Rs222 crore, mainly due to delinquencies in the personal loan segment. “We are tweaking our business plan for Citifinancial. We are relocating some branches, carrying out greater credit checks, becoming a one stop shop for consumers,”?Nayar?said.
Quatrro to acquire UKgaming service provider
New Delhi:Quatrro BPO Solutions Pvt. Ltd, backed by private equity firm DE Shaw and Co. Lp., is acquiring the UK-based gaming service provider Babel Media Ltd.
Quatrro, chaired by Raman Roy, one of earliest back-office businessmen in India, declined to disclose the size of the investment, but said it is “the largest transaction we’ve done to date.”
Babel currently houses the bulk of its operations in the UK and Canada, with only 15 of its 500 staff in India.
With the acquisition, Quattro plans to build up India’s nascent industry of back- office services for games played on mobile devices, video consoles and the Internet, a market that industry reports estimate at $45-50 billion (Rs1.9-2 trillion). Staff Writer
Delhi court adjourns Tarceva hearing
New Delhi: A newly constituted two-member bench of the Delhi high court has adjourned the hearing on the dispute involving patented cancer drug Tarceva to 4 July.
Chief justice Ajit Prakash Shah and justice S. Muralidhar will be hearing on Friday the arguments of lawyers representing F.Hoffman La-Roche Ltd, a Swiss drug maker whose injunction plea against Cipla Ltd for selling a copy of the cancer drug (chemical name: erlotinib) was denied by a single-judge bench of the court earlier.
Roche is appealing that decision before a larger bench in the court. Bhuma Shrivastava
Ansal API net profit increases 31%
New Delhi: Real estate developer Ansal API Ltd posted a net profit of Rs173.51 crore for the financial year ended March 2008, an increase of 31.32% from Rs132.12 crore in the previous year.
The company’s revenue rose to Rs1,011.36 crore, 14.72% up from Rs881.56 crore.
Ansal API board declared a dividend of 25% on shares of face value of Rs5 for 2007-08.
“This year saw approvals of various projects and financial year 2008-09 will witness commencement of execution of these projects,” Sushil Ansal, chairman of Ansal API, said. “We have been selective in launching our projects and that has contributed to our sustained growth.”
Shares of Ansal API lost 10.7% to close at Rs61.75 on the Bombay Stock Exchange. Shabana Hussain