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					                                Business Bulletin
                                                                                               Date: April 07, 2010
News Feature:
SEZ exports to touch Rs 2 lakh crore in FY10: Exports from SEZs are likely to touch Rs 2 lakh crore in 2009-10, a 100
per cent jump from the year-ago period, with Reliance Industries Jamnagar special economic zone expected to contribute the
most to the kitty. Exports in general are very robust...in 2009-10 they are likely to be Rs 2 lakh crore as against Rs 1 lakh crore
last year. Exports in the first three quarters of the last fiscal were Rs 1.52 lakh crore, showing a growth of 127 per cent over the
corresponding period of 2008-09. The industry is expecting that exports from SEZs would be in the range of Rs 3 lakh crore in
2010-11.

OVERSEAS NEWS:
US can participate in $1 trillion infra investment plan: The Planning Commission said the US can participate in the
development of India's infrastructure sector, the requirement for which is being pegged at USD 1 trillion in the 12th Five-Year
Plan (2012-17). Of the proposed investment of USD 1 trillion in the infrastructure sector during the 12th Plan, private sector
would be expected to contribute up to 40-50 per cent. India's growth rate, which slipped to 6.7 per cent during 2008-09
following the global financial meltdown, is estimated at 7.2 per cent during 2009-10 and is slated to move up to 8.5 per cent
during the current fiscal.

Sectoral News:
Power
Power sector poised for double-digit growth: India’s quest for Superpower shall rely immensely on the country’s
ability to be self reliant in terms of energy generation and power distribution. Already power majors of the world including
Areva, Alstom, Siemens, L&T etc have commenced their India –intensive operations to supply power infrastructure and
engineering services. New power sub stations are being established with enhanced capacity and the power is distributed using
high-grade power cables. EHV cables (>132 KV class) are used to transmit huge quantity of power underground, in absence of
any scope for overhead transmission lines. Annual current demand for EHV cables is expected to grow at a rate of 11-13% in
near future.
Qatar interested to invest in Indian power sector: Qatar has evinced interest to invest in the Indian infrastructure
sector, especially the power segment, and both countries will look at collaborations in the area. The envoy said it is expected
that the Qatari investments will be in the Indian power generation sector. India permits 100 per cent foreign direct investment
in power generation, transmission and distribution. India, which has the fifth largest electricity generation capacity in the
world needs investments worth about USD 167 billion in the power sector during 2007-12 period in order to add more than
90,000 MW of generation capacity.
Suzlon gets order from Italian firm to supply wind turbines: Wind power major Suzlon Energy, its subsidiary
REpower Systems AG has bagged a contract from an Italian company for supplying 18 wind turbines. REpower has concluded a
contract for the supply of 18 wind turbines to Daunia Savignano, a subsidiary of Italian Tozzi Group. REpower will be
responsible for the supply, erection and commissioning of these wind turbines at Savignano wind farm in Southern Italy. The
company would be supplying MM92 turbines having a rated output of 2.05 MW for the wind farm.

Cement
Murli Industries to set up cement plants in Rajasthan, Karnataka: Murli Industries Ltd has announced that it plans
to set up cement plants in Rajasthan and Karnataka. The plants are expected to have a capacity to produce 3 MTPA of cement
along with 50 MW Captive Power Plant at each location. The plant in Rajasthan will cater to markets of Rajasthan and NCR
while the Karnataka plant will concentrate on Karnataka, Goa and adjacent parts of Maharashtra. The initial investment would
be approximately Rs 2300 crore for both the projects.
Cement sales may rise 12%: Rise in demand from real estate and construction companies is likely to increase cement
sales by 12% to 20 million tonnes this month compared with the same period last year. Sales for the building material grew
11% in January and 4.3% in February. Cement majors such as Aditya Birla, Jaiprakash Associates, Dalmia, JK Lakshmi and
Shree Cements, which posted higher growth last month, are likely to grow this month as well due to higher consumption.
These five companies together account for almost half of India’s total capacity of 240 million tonnes.

Mining
Ruias to buy Indonesian coal mine for $208 mn: The Essar Group has agreed to acquire a 64-million tonne (mt) coal
mine from an unnamed private company in Indonesia as part of its efforts to secure raw material supplies for its proposed
thermal power projects in India. Essar Power is currently building six power projects in India, raising its power generation
capacity from 1,220 mw to 6,100 mw by ’12. They are a vertically integrated power producer, with ownership and access to
the raw materials needed to run the business.
BBCE1, 2010


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Food & Beverages
Fast food joints cash in on new-age transit locations: India is on the move. So are Indians. With around 20 million
people using the railways everyday across 7,000 stations and thousands boarding flights from airports, branded food retail
chains too have started making lucrative business moves. Be it airports, railway and metro stations, bus stands or highways,
these new-age transit locations have set the cash registers ringing for food retail chains. McDonald’s plans to open 40 transit
outlets this year with an investment of Rs 120 crore.

Steel
Steel consumption up 8% on high infra, auto demand: Steel consumption grew 8% in the fiscal year ended March
2010 after shrinking a little a year ago, due to strong demand from automobile, infrastructure and housing sectors, as per the
steel ministry. Demand for the metal is a key indicator of industrial activity and steel consumption had shrunk 0.5% in the year
ended March 2009 as economic slowdown hit domestic demand. The country’s steel consumption increased to 56.3 mt in the
twelve months to March 2010 from 52.3 mt in the previous year. Production in the world’s fifth-largest steel producing nation
rose 4.2% to 60 mt.
Steel majors see 15% rise in sales in March: Top Indian steel makers including Steel Authority of India (SAIL), Tata
Steel and Essar saw up to 15% increase in sales in March from a year ago owing to robust demand from automobile and
infrastructure sectors. The growth in steel demand is a key indicator of industrial activity, which had slumped early last year
due to the economic downturn. Most steel companies were then operating at less than 60% of their production capacity. Top
Indian steelmakers including Sail, Tata Steel, JSW and Essar hiked prices by up to Rs 3,000/tonne, effective April 1. The metal
prices are expected to move up further due to rise in raw material prices, particularly iron ore.
Bhushan Power to invest Rs 2k-cr in steel plant: The Rs 5,000-crore Sanjay Singal-promoted Bhushan Power and
Steel (BPSL) plans to invest Rs 2,000 crore to set up an automotive grade steel plant with installed capacity of five lakh tonne.
The company has identified two locations — Maharashtra and Gujarat — for the project. The investment cost for the setting up
of the project will be met through a mix of internal accruals and debt. The proposed project will come up in phases. In the first
phase, the company will commission 3 lakh tonne of steel producing capacity.

FMCG
India is a fast-growing market for consumer goods: A rapidly expanding middle class with high aspirations and a
growing appetite for quality goods make India an attractive investment destination for consumer goods companies. The sheer
size of the market, its relatively young population and economic and social stability all work in India's favour. India is one of its
fastest growing markets. It has been growing by double digit percentages for a number of years. In 2009, Amway India has
reached sales of Rs 1,407 crore or $300 million, a 25 percent increase over 2008.
Mary Kay to invest Rs 90 cr in India in next 5 years: Aiming to strengthen its presence in India, US-based cosmetic
firm Mary Kay today said it will invest around Rs 90 crore in the next five years on product development, infrastructure and
building its brand. The company has already invested around Rs 10 crore in the last two and half years. At present, Mary Kay
employs around 4,000 direct sellers or "beauty consultants" and is looking at increasing its sales force as well as enter new
markets like Uttar Pradesh, Gujarat and Southern India by the end of the year. Mary Kay's products are present in 200 cities
across the country, particularly in the northern, western and the north-eastern region.
FMCG prices to go up 2%-5%: The fast moving consumer goods(FMCG) industry is likely to get a boost with expectations
of higher volume growth as consumers spend more on the back of higher disposable income due to cut in income tax, but
prices of daily use products are expected to go up. Prices of daily consumption products like soaps, talcum powder, shampoos,
hair colour, diapers and sanitary napkins are set to go up 2-5%. Products like diapers and sanitary napkins which were fully
exempt from excise will now attract duty of 10%. But deodorants and perfumes could get cheaper by 5%, as excise duty on
medicinal and toilet preparations act is being reduced from 16% to 10%.

Media & Entertainment
Dishtv crosses 70 lakh subscribers mark, announces new packages: India’s largest DTH Company Dishtv has
created a record of sort by having more than 70 lakh subscribers across the country. Dishtv also unveiled a special acquisition
offer ‘World Cup Se World Cup Tak'. With the launch of this offer Sports fans can now enjoy more sports than ever with 12
Month Gold Pack plus Set Top Box for Rs. 3190 and 4 month Gold Pack plus Set Top for Rs. 1690. Rs. 200 installation cost is
extra.
India to have 3mn HD-ready households by year-end: India is expected to have three million household using high
definition television service by the end of this year, largely driven by major sporting events like Commonwealth Games and
soccer World Cup to be held during the year. India currently has about 3,00,000 HD-ready households and by year-end this will
go up to 3 million. There were 19 million digital homes (DTH and digital cable) which was just about 10 per cent penetration.
By 2018, digital penetration should be about 42 per cent.



BBCE1, 2010


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Electronics
India's Consumer Electronics Industry Scales New Heights: The consumer electronics market is one of the largest
segments in the electronics industry in India. With a market size of Rs.15,897.13 crore ($3.89 billion) in 2006, catering to a
population of more than 100 crore people, the consumer electronics industry in India is poised for strong growth in the years
to come. iSuppli Corp. predicts the Indian audio/video consumer electronics industry will grow to Rs.26,931.13 crore ($6.59
billion) by 2011, rising at a Compound Annual Growth Rate (CAGR) of 10.0 per cent from Rs.18,390 crore ($4.5 billion) in
2007.

(Industry analysis & Market trends in Consumer Electronics Sector)




Retail
Reliance Retail to invest Rs 150 cr to open 20 Hamleys stores: Reliance Retail, which has a tie-up with UK-based toy
retailer Hamleys, plans to open 20 toy stores across the country in the next seven years with an investment of Rs 150 crore. We
plan to open 20 Hamleys stores across the country at a total investment of Rs 150 crore over the next seven years. The
organised toy market in the country, estimated at Rs 1,500 crore is poised for a healthy growth.

Infrastructure
Pvt sector to contribute $500 bn for infra in 12th Plan: The Planning Commission expects the private sector to
contribute up to USD 500 billion for development of infrastructure sector, which is nearly half the estimated investment
requirement of USD one trillion projected for the Twelfth Plan (2012-17). The contribution of private sector in development of
infrastructure sector is expected to go up from 25 per cent in the Tenth Plan to 36 per cent in the Eleventh Plan and further to
about 50 per cent in the next Plan. A preliminary assessment suggests that investment in infrastructure during the Twelfth
Plan would need to be of the order of about Rs 40,99,240 crore (USD 1,025 billion) to achieve a share of 9.95 per cent as a
proportion of the GDP.
Japan commits Rs 10,535 crore towards six infra projects in India: Japan committed 215 billion yen (Rs 10,535
crore) for six infrastructure projects in India, including Phase II of the Mass Rapid Transport System (MRTS) for Delhi. The
committed 215 billion yen would flow into the country in the next fiscal (2010-11) and the year beyond. With this agreement,
official development assistance from Japan will touch 3,116.81 billion yen (Rs 1,55,840 crore), making India the highest
recipient of such assistance from the Far East country. In addition, 23.4 billion yen (Rs 1,146 crore) will go towards Calcutta
East-West Metro Project Phase II, 59.85 billion yen (Rs 2,932.6 crore) for Chennai Metro Project Phase II and 90.3 billion yen
(Rs 4,422 crore) for the first phase of a dedicated Freight Corridor Project of Railways.




BBCE1, 2010


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India expects $5 bn Canadian investment in road sector: India expects a big investment of $5 billion (around Rs
22,800 crore) from Canada in the country's road development programme over the next three to four years. As qouted that of
the $40 billion needed from the private sector for the road programme, about $10 billion is likely to come from foreign funds.
They expect $5 billion from Canada. The Indian government will put as many as nine mega projects up for bidding in the next
two months.

Real Estate
Vision India Real Estate to invest $100 to $200 mn in 3 years: Vision India Real Estate, a closely-held business
group in the US, is investing $5 million (as per the FDI norms) in Gem Group’s upcoming residential project in Chennai. This
will be the first joint development project for the US company, that is proposing to invest $100 to $200 million over the next
three years on projects, especially in the logistics arena. It has developed 40 million sq ft of space, half of it in the logistics space
in the US and Europe. About 15 million sq ft has been for residential segment and 5 million sq ft towards hospitality. Gem
Grove, a Rs 320 crore residential project, is coming up on 6.64 acres of land at Padur on the Old Mahabalipuram Road in
Chennai. It will have 712 housing units, covering a built-up area of approximately 8 lakh sq ft.
Largest mall, Mantri Square to have metro connectivity: Leading real estate player Mantri Developers today
announced the opening of one of India's largest malls Mantri Square spread over 1.7 million square feet and which would soon
have a metro connectivity as well. With an investment of over Rs 500 crore, the mall boasts of 252 retail outlets offering 10,000
brands. The station is expected to provide an additional footfall of 20,000 once it becomes operational in two years time frame.
The developers expect the footfall to go up to one lakh a day once the station was operational. The station area would cover
around 80,000 sq feet and would involve third party maintenance.
Telecom
FDI appears to be bypassing the telecom sector: Foreign Direct Investment (FDI) appears to be bypassing the telecom
sector, despite India being one of the most attractive and fastest growing telecom markets. An analysis of the ownership details
revealed by nine bidders for the 3G auctions opening reveals that the average FDI holding is just below 40% (39.7%). This
changes the common perception that FDI levels in the telecom sector are very high. It also reveals that despite the fact that FDI
limits were raised from 49% to 74% five years ago, foreign investors have not utilized the higher investment ceiling.
All 9 telecom companies qualify for 3G spectrum auction: All the nine telecom companies, which had applied to
participate in the auction of radio frequency spectrum for third generation (3G) telephony, have qualified for the bidding
process that will take place next week. According to the Department of Telecommunications (DoT), all the nine telecom
companies -- Aircel, Bharti Airtel, Etisalat DB Telecom, Idea Cellular, Reliance Telecom, S Tel, Tata Teleservices, Videocon
Telecommunications and Vodafone Essar -- will participate in the auction for 3G. According to the Notice Inviting Applications
(NIA) issued Feb 25, 2010, of the 22 telecom circles, five states - Punjab, Bihar, West Bengal, Himachal Pradesh and Jammu and
Kashmir - will have four private players for 3G spectrum auction.
India's 3G cost way below world's: The government is gearing up for a Rs 30,000-crore bonanza for the public purse
from 3G auctions, which begin on April 9. But what appears to be an aggressive revenue target will actually yield one of the
lowest prices per population, or price per pop as its usually called, for 3G in the world. The reserve price for 3G is Rs 3,500
crore and winning bids are expected to be in the range of Rs 6,000 to 8,000 crore ($1.4 to $1.6 billion). With a total population
of 1.2 billion, this translates to a 3G price per pop of $1.16 to $1.41 or an average of roughly Rs 70 for each operator, much
lower than the global average of $29 (Rs 1,363) per pop across 13 countries.



News Round – Up:
India to provide duty-free access to products from LDCs: India has informed the World Trade Organisation it will
ensure the least developed countries (LDCs) get access to its market without duties or quotas. In a presentation to the WTO
Committee on Trade and Development in Geneva, India said it was the first developing country to offer duty-free and quota-
free (DFQF) market access to the LDCs. The Indian market has been thrown open to these countries for products of their
export interest. The items to enjoy duty-free entry include cotton, cocoa, cane sugar and ready-made garments. Such a facility
has been offered to 14 LDCs--Bangladesh, Nepal, Bhutan, Cambodia and some of the African nations.




BBCE1, 2010


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