Unitech to sell non-core lands to cut debt, up cash-flows

Unitech currently has over 100 ongoing projects, totalling an area of 38.41 million sq ft. Its net debt stood at Rs 5,900 crore at the end of the first quarter of this fiscal.

Real estate firm  Unitech will sell non-core land parcels to reduce debt by 15-20 percent and improve cash-flows for faster execution of ongoing projects, company's chairman Ramesh Chandra has said.

Unitech currently has over 100 ongoing projects, totalling an area of 38.41 million sq ft. Its net debt stood at Rs 5,900 crore at the end of the first quarter of this fiscal. "We do have land that is non-core to the business that will be sold to improve liquidity and reduce debt exposure related risks," Chandra told shareholders in the company's annual report for last fiscal.

Also Read: CBI to probe Tata Realty-Unitech land deal worth Rs 1700 cr

He also said that the cash flows of the company were affected during last financial year due to adverse market conditions and consequent slowdown in sales. Stating that Unitech has taken a conscious strategic decision to reduce debt exposure, he said the company has in the recent past undertaken sale of some land parcels for which it has no development plans in the foreseeable future to bridge the cash flow gap.

Apart from land sales, Chandra said it is also monetising some of the commercial assets. "All these transactions, once concluded, could reduce the company's consolidated debt by about 15 to 20 percent," he added.

In June, Unitech had sold its 40 per cent stake each in four IT SEZ projects for over Rs 1,300 crore to Canada's Brookfield Asset Management. Unitech chairman also emphasised on increasing the pace of delivery of projects.

"Since the pace of new projects sold in the last few years was significantly faster than the speed of delivery, the equilibrium in the system was disturbed. Restoring this equilibrium by increasing the pace of delivery is a key priority for the company," Chandra said. During 2013-14, Unitech posted a net profit of Rs 69.7 crore, while income from operations stood at Rs 2,933.3 crore.

Unitech stock price

On September 02, 2014, Unitech closed at Rs 23.90, up Rs 0.15, or 0.63 percent. The 52-week high of the share was Rs 38.60 and the 52-week low was Rs 10.86.

The company's trailing 12-month (TTM) EPS was at Rs 0.23 per share as per the quarter ended March 2014. The stock's price-to-earnings (P/E) ratio was 103.91. The latest book value of the company is Rs 37.72 per share. At current value, the price-to-book value of the company is 0.63.

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12 Indian firms in Forbes' 50 best cos in Asia Pacific

Tata Consultancy Services ( TCS ), HCL Technologies  and HDFC Bank  are among the 50 best public companies in Asia-Pacific according to a compilation by Forbes, which ranked India second behind China as home to the "world's next growth engines".

The Forbes 2014 'honour roll of the Fabulous 50' lists best of Asia-Pacific's biggest publicly traded companies. China has 16 companies on the list, more than any other country, a distinction it has enjoyed for the last three years. However, the number of Chinese companies on the list has gone down from 20 last year on the back of slow economic growth in the country.

India trails China with 12 companies on the list, the same number as last year.

The Indian companies on the list are Asian Paints , Axis Bank , HCL Technologies , HDFC Bank, Lupin , Mahindra and Mahindra , Motherson Sumi Systems , Sun Pharma , TCS, Tata Motors , Tech Mahindra  and Titan .

HDFC Bank, India's second-largest private sector bank, has made the list eight times, more than any other company since Forbes started the compilation in 2005.

TCS makes it to the list for the seventh time while Tech Mahindra, the country's fifth-largest IT player, debuts on the list after net profits soared 112 per cent to touch USD 500 million. Indian conglomerate ITC failed to make it to the list this year.

Forbes said TCS, India's largest IT company, boasts a market cap of USD 71.25 billion, bigger than the country's next 3 IT outfits combined.

"Long dependent on the US market, (TCS) may soon generate more than half its revenue outside the US," the publication said.

South Korea has six companies on the list, followed by Hong Kong with three and two each from Japan, Australia, Malaysia, Singapore and Thailand. Technology companies dominated the list with nine representatives.

The consumer durables industry has the second most members with seven companies, including four motor vehicle giants from China and India, as the rise of Asia's middle class continues to drive demand.

Three oil and gas companies make it into the rank, up from only one firm from last year.
The list is chosen from a pool of 1,300 companies in the region that have at least USD three billion in market cap or annual revenue.

Forbes took into account performance measures and outlook and did not include companies that carried a lot of debt or were more than 50 per cent state-owned.

TCS stock price

On September 02, 2014, Tata Consultancy Services closed at Rs 2539.10, up Rs 1.85, or 0.07 percent. The 52-week high of the share was Rs 2613.35 and the 52-week low was Rs 1895.10.

The company's trailing 12-month (TTM) EPS was at Rs 102.67 per share as per the quarter ended June 2014. The stock's price-to-earnings (P/E) ratio was 24.73. The latest book value of the company is Rs 224.90 per share. At current value, the price-to-book value of the company is 11.29.

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Kingfisher to challenge Union Bank's decision

In a statement, the Vijay Mallya-owned company said, "KFA and its directors will vigorously challenge the decision of UBI".

Hours after the Supreme Court refused to entertain a petition filed by  Kingfisher Airlines against being declared wilful defaulter by Union Bank of India , the airline today said it would "vigorously challenge" the bank's decision. In a statement, the Vijay Mallya-owned company said, "KFA and its directors will vigorously challenge the decision of UBI" and they "strongly deny the allegations of wilful default for alleged non-payment of Rs 7.5 crore to UBI."

"KFA and its directors have not been given any opportunity to present their case through lawyers of their choice before UBI who have come to a wrongful ex-parte decision in great haste when the question of legal representation was under challenge," Prakash Mirpuri, Vice President (Corporate Communications) of the UB Group, said.

Also Read: SC declares Kingfisher plea as infructuous

The airline had yesterday too accused the UBI of having proceeded post haste to "declare KFA and its directors or erstwhile directors as wilful defaulters in respect of an overdraft facility of Rs 7.5 crore." It had also said that "KFA intends to pursue all available legal remedies". State-run UBI had yesterday become the first lender to declare the debt-ridden airline and its promoter Vijay Mallya as wilful defaulters.

Kingfisher Air stock price

On September 02, 2014, Kingfisher Airlines closed at Rs 2.59, down Rs 0.09, or 3.36 percent. The 52-week high of the share was Rs 6.84 and the 52-week low was Rs 2.06.

The latest book value of the company is Rs -166.59 per share. At current value, the price-to-book value of the company was -0.02.

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Jan Dhan scheme to help tackle ponzi menace: Sebi chief

Expecting the government's efforts to expand financial inclusion to help curb ponzi menace, Sebi chief U K Sinha has said that agents, lured by 20-30 percent commissions, have been pushing illicit schemes among gullible investors in the absence of good savings products.

Sinha, who is steering Sebi efforts to tackle the ponzi menace, said that in regions like West Bengal and North East, where penetration of banking services is low, have seen a larger number of people getting trapped in illegal money pooling schemes that promise high returns.

He hoped that new programmes like the Jan Dhan scheme, launched by Prime Minister Narendra Modi to expand financial inclusion and banking coverage across the country, will help encourage people to put their money in formal financial system.

"There have been certain deficiencies in financial services space and that have been a key reason for mushrooming of illegal schemes... Jan Dhan Yojana will plug this loophole," Sinha told PTI in an interview.

"If you look at the larger picture, part of the reason is that there is deficiency in provision for financial services in different parts of the country. Perhaps if that deficiency was not there people would not have invested (in ponzi schemes)," the Sebi Chairman said.

Also read:  Jan Dhan Yojna feasible, but unsure of costing: Ex-Bankers

The capital market watchdog has now got more powers, such as carrying out search and seizure operations, to clamp down on fraudsters and illegal money pooling activities.

According to Sinha, traditionally in West Bengal, the national savings or postal savings used to be very high compared to many other parts of the country. Besides, the density of bank branches in West Bengal and North East is low.

"When there was a deregulation of interest rate, then the whole post deposit scheme did not remain as attractive as they were in the past. So people started getting attracted to all this (money pooling schemes).

"Most of the agents of CIS are people who were agents of small savings (schemes) or mutual funds ... They thought they could get as high as 20-30 percent commissions, so they started pushing for these (ponzi) schemes," Sebi chief said.

With the enactment of a new Securities Laws Amendments Act, the government has enhanced powers of Sebi to take action against illegal money-pooling activities involving Rs 100 crore or more. The Act also provides for setting up of a special court to expedite the cases filed by Sebi.

The capital market watchdog has already taken action in recent years against entities having collectively raised well above Rs 1 lakh crore through various schemes and its crackdown is expected to rise considerably after grant of new powers.

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Mahindra's auto sector sells 35175 units during August 2014

Mahindra and Mahindra today announced its auto sales numbers which stood at 35175 units during August 2014 as against 37897 units during August 2013.

Mahindra & Mahindra Ltd has informed BSE regarding a Press Release dated September 01, 2014, titled "Mahindra's Auto Sector sells 35,175 units during August 2014". Mahindra and Mahindra today announced its auto sales numbers which stood at 35175 units during August 2014 as against 37897 units during August 2013.Source : BSE

Read all announcements in M&M

To read the full report click here

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Your Stocks: Top picks by market analyst

Watch the interview of P Phani Sekhar, Fund Manager--PMS at Angel Broking and Sharmila Joshi of Sharmilajoshi.com with Sumaira Abidi & Nigel D'Souza on CNBC-TV18, in which they shared their reading and outlook on market and specific stocks.

Watch the interview of P Phani Sekhar, Fund Manager--PMS at Angel Broking and Sharmila Joshi of Sharmilajoshi.com with Sumaira Abidi & Nigel D'Souza on CNBC-TV18, in which they shared their reading and outlook on market and specific stocks.

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Maximus Securities view on Amara Raja Batteries

Maximus Securities has come out with its report on Amara Raja Batteries. The research firm has target of Rs 660 on the stock.

Maximus Securities research report on Amara Raja Batteries

"Amara Raja Batteries Ltd (ARBL) is one of the largest manufacturers of Standby Valve Regulated Lead Acid (VRLA) batteries in the Indian Ocean Rim comprising the area ranging from Africa and the Middle East to South East Asia. They are in the business of Industrial Battery and Automobile Battery manufacturing. The manufacturing facility is located at Tirupati in Andhra Pradesh.The company is the largest supplier of stand-by power systems, catering to Indian utilities such as, Departments of Telecommunication, Indian Railways, Power Generation Stations, MTNL, VSNL, ITI and HTL. They are also having prestigious Automotive clients including Ford, GM, Daimler Chrysler, Ashok Leyland, TELCO, Honda and Mahindra & Mahindra."

"ARBL's Amaron brand of batteries was India's first battery to be fully charged from the time it was manufactured inside the factory. Thus the dealers could only sell a long-lasting battery. ARBL's Automotive Batteries Unit commenced operations with technology from Johnson Controls Inc. (26.02% shareholder), joint venture partner and the world's largest manufacturer of automotive batteries in the year 2000. It pioneered the Valve Regulated Lead Acid (VRLA) technology in India's automotive battery segment, the key differentiator in an otherwise cluttered Indian automotive battery market. Based on the technology, the unit created an unmistakable brand recall. Amaron was the first to offer a warranty of 36 months and followed that with a pro-rata warranty of 60 months for car batteries, which was almost twice the existing life. Amaron became the first and only 60-month pro-rata warranty battery for two-wheelers."

"Considering the clean balance sheet, strong financial performance during recession, scope for increasing market share and imminent recovery in the Indian economy, we value Amara Raja Batteries Ltd with a P/E of 19.5x FY16E EPS to arrive at a target price of Rs. 660/share," says Maximus Securities research report.

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To read the full report click here

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KFA case: Decoding implications of 'wilful defaulter' tag

United Bank has declared Kingfisher Airlines and its promoter Vijay Mallya as 'wilful defaulter'. The bank is in the process of sending formal notices to the company and will inform RBI as well.

Now with this wilful defaulter tag on, there would be no debt kind of issuances from the banking sector

Ashvin Parekh

Managing Partner

Ashvin Parekh Advisory

United Bank  has declared Kingfisher Airlines  and its promoter Vijay Mallya as 'wilful defaulter'. The bank is in the process of sending formal notices to the company and will inform RBI as well.

United Bank is the first bank to declare the grounded airline as 'wilful defaulter' . Even State Bank of India  and Punjab National Bank  are in the process of doing so. The step came after KFA officials did not show up for the meeting with the United Bank's grievance cell at 10:30 am Monday. United Bank has Rs 350-crore exposure to KFA.

The consortium headed by SBI is looking to sell collateral to recover dues.

Discussing the implications of a 'wilful defaulter' tag, Ashvin Parekh, MD, Ashvin Parekh Advisory Services, said that in case the company is just a defaulter, then it still has options to either go through the CDR route or rebuild its assets, which will demonstrate the banking system that the company/promoter has adequate amount of business viability left.

However, in KFA's case, the bank will step in each and every aspect of it. Now with this wilful defaulter tag on, there would be no debt kind of issuances from the banking sector and this will extend to all group companies as well, said Parekh.

United Bank stock price

On September 01, 2014, United Bank of India closed at Rs 47.20, up Rs 1.60, or 3.51 percent. The 52-week high of the share was Rs 61.65 and the 52-week low was Rs 23.40.

The latest book value of the company is Rs 64.81 per share. At current value, the price-to-book value of the company was 0.73.

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Manufacturing has turned; news in most sectors positive: FM

Jaitley expressed confidence that the Insurance Bill would be passed in the next session of Parliament and that he was hoping to see a positive attitude in some of the principal opposition parties

Moneycontrol Bureau

The manufacturing curve has turned for the better and most sectors are indicating positive news, Finance Minister Arun Jaitley said at a press conference to highlight the government's achievements in its first 100 days since being sworn in office.

India's GDP expanded 5.7 percent in the first quarter of FY15, the highest in nine quarters, against a growth of 4.6 percent in Q4 of 2013-14, and 4.7 percent in teh year-ago period.

He said inflation by and large was showing signs of moderation and while there could be some impact of deficient monsoons on food prices, there were sufficient stocks.

He also added the steep rise in food prices was a common at this time of the year.

He expressed confidence that the Insurance Bill would be passed in the next session of Parliament and that he was hoping to see a positive attitude in some of the principal opposition parties.

He said the government's ambitious Jan Dhan Yojana has been a success with over 2 crore bank accounts being opened so far till today noon. He added that banks would not bear the burden of the scheme.

Jaitley said the situation in the road sector was challenging and that the concerned ministry has been given more flexibility to deal with it.

On the issue of Goods and Services Tax, he said there have been discussions with the chief ministers of West Bengal and Rajasthan, and that the government was serious in paying central sales tax dues to the states. He said the government will take try to pay the arrears as soon as finances improved. Jaitley however said too many items could not be kept out of the GST chain.

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Indian Bank to revise interest rates on FCNR (B) deposits

"For FCNR (B) deposits, in USD, the revised interest rate has been revised to 2.34 percent (from 2.36) for deposits of one year and above but less than two years", the Chennai-based bank said in a statement

Public sector  Indian Bank will revise its interest rates on the foreign currency non-resident (banking) term deposits from tomorrow.

"For FCNR (B) deposits, in USD, the revised interest rate has been revised to 2.34 percent (from 2.36) for deposits of one year and above but less than two years", the Chennai-based bank said in a statement.

For deposits of two years and above but less than three years, interest rates have been revised to 2.71 percent from the existing 2.76 percent. Interest rates have been revised to 3.64 percent for deposits of three years and above but less than four years from the existing 3.71 percent, it said.

For deposits of four years and above but less than five years, interest rates have been revised to 4 percent from existing 4.11 percent. Interest rates have been fixed at 4.27 percent for deposits upto five years only from the existing 4.40 percent, the statement said.

Indian Bank stock price

On August 22, 2014, Indian Bank closed at Rs 136.65, down Rs 7.2, or 5.01 percent. The 52-week high of the share was Rs 198.90 and the 52-week low was Rs 60.50.

The company's trailing 12-month (TTM) EPS was at Rs 22.56 per share as per the quarter ended June 2014. The stock's price-to-earnings (P/E) ratio was 6.06. The latest book value of the company is Rs 298.40 per share. At current value, the price-to-book value of the company is 0.46.

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