Cairn Energy Plc in talks to sell stake in Indian arm

New Delhi: Scottish oil explorer Cairn Energy Plc today said it is in talks to sell stake in its Indian unit, Cairn India, which owns the massive Rajasthan oilfields, reports PTI.

Though Cairn Energy did not identify the suitor, speculation is rife that it could be India-focused miner Vedanta Resources Plc.

"The board of Cairn Energy Plc confirms that discussions are taking place with a third party in respect of the disposal of an interest in Cairn India Ltd," the London-listed firm said in a brief press statement.

A Vedanta spokesperson declined to comment.

Cairn Energy holds 62.36% stake in Cairn India.

"There can be no certainty the contemplated disposal will occur or as to the terms of any such disposal," the statement said. "A further announcement will be made when appropriate."

If it is successful, Vedanta will be the only second large miner in the world after BHP Billiton to have interest in oil.

Vedanta has iron ore, zinc and copper mines.

Sir Bill Gammell-run Cairn Energy may retain a controlling interest in Cairn India even it sells up to 12% interest for Rs7,741 crore at today's closing price.

The talks are advanced and billionaire Anil Agrawal-controlled Vedanta may be discussing a range of options, including an equity stake, asset purchase or a complete takeover of Cairn India.


Cashless medical facility likely to resume in a week

New Delhi: Suspended since July, the cashless treatment facility by PSU insurers is likely to be restored fully in Delhi hospitals within a week, but the insured might have to pay higher premiums for treatment in super specialty medical centres, reports PTI.

"I am hopeful that cashless mediclaim treatment would be fully restored in seven days. Going forward we will see the component of co-pay gaining more importance. There would be different premiums for different hospitals," Max Healthcare Institute MD Pervez Ahmed said after a CII initiated meeting of hospitals and the Third Party Administrators (TPAs).

Sources said in a week's time each hospital would work out a package rate with the TPAs, which are the facilitators between the insured and the insurer.

IRDA chairman J Hari Narayan had yesterday said the costs of treatment could vary from hospital to hospital in the coming days.

"Markets will get segmented and certainly there would be differential pricing. We have moved away from administered pricing and now prices have to be left to market forces," he had said.

From 1st July, public sector insurance companies had taken off about 150 hospitals from the list of preferred provider network (PPN) that provide cashless hospitalisation services to policy holders under the mediclaim scheme.

Later, the insurers had partially restored the cashless facility for emergency, ICU, cardiac care and trauma.

Mr Ahmed said the hospitals, within 24 hours, would give all the rates to the TPAs, following which they would fine tune different packages for hospitals.

"The insurance companies have asked the TPAs to work on their behalf. Now there would be individual negotiations between hospitals and TPAs. We will do it in seven days and restore the cashless mediclaim fully," he added.

At present, health insurance is a loss-making proposition for many insurance firms as they give more in claims than they collect from premiums. In fact, the claim ratio, which measures this trend, is about 130% for the industry.

There are about eight crore mediclaim policy holders in the country.

Four insurance companies-New India Assurance, United India Insurance, National Insurance and Oriental Insurance-stopped the cashless service because of alleged over-billing by some private hospitals.

Mr Ahmed said in the current scenario, standardised rates are not possible. "The insurers would accept the propositions of the TPAs. We will involve insurers for refining the products," he said.


AMFI to tighten registration process for mutual fund distributors

The industry body will tweak ARN registration and renewal norms from 1 September 2010

After announcing a sharp hike in AMFI Registration Number (ARN) renewal fees across the board in May this year, the Association of Mutual Funds in India is all set to tighten the noose on mutual fund distributors further. The existing guidelines for procuring an ARN number and renewing it will be made more stringent.

"We already have a process in place and we are tightening the same process a little bit," HN Sinor, chief executive officer, AMFI, told Moneylife. However, Mr Sinor declined to divulge any further details and said that the AMFI board has to approve the changes first. When asked if AMFI is considering reducing the fee structure, Mr Sinor said that it was not. The ARN renewal fee was hiked to keep serious players in the market in an attempt to curb mis-selling. Alarmed by the steep hike, some distributors - who were already hit by dwindling commissions - approached AMFI to consider relaxing the fee structure.

Earlier, individuals and corporate employees were required to shell out Rs250 as renewal fee which was increased to Rs2,500. For banks, non-banking financial companies (NBFCs), public limited companies and institutional distributors, the renewal fee was raised from Rs7,500 to Rs2,50,000.

Individuals who pass the AMFI examination are allotted an ARN number.  From 1st June, The National Institute of Securities Markets (NISM) conducts the certification for distributors called CPE (Continuing Professional Education). 

"Their (AMFI's) idea is to have a good quality distribution setup, but the problem is that there are too many things happening so quickly. In the last one year, they have implemented more changes than what has happened in the last 15 years. I was speaking to a senior official in Singapore who advises various regulators there. They have a well laid-out plan for any regulatory changes. It takes seven years to make the kind of changes which we have done here in (only) seven weeks. All good things will take shape if they are done in the right manner. You can't get up one morning and say I want everything cleaned up overnight. The direction is right but the execution is wrong," said a Mumbai-based certified financial planner (CFP), preferring anonymity. 

Currently, individuals and corporate employees are required to furnish a copy of the AMFI certificate, two photographs and the fees at the time of registration. "The current procedure is very simple. They can bring some changes in mandatory requirement of certain documents which will be an ongoing process. This practice is followed worldwide. Globally, they follow far stricter guidelines but the industry is flourishing because the distributors are also making money. Their yield (commission) is around 3% there but in India the regulators have reduced it to around 1%," added the CFP.

Rajesh Krishnamoorthy, managing director of iFAST Financial told Moneylife, "Without specifics of what AMFI will do, it is difficult to frame any opinion.

AMFI will have to balance both the social norm and the business norm. The social norm being - more the number of people associated with the distribution of mutual funds, the better the chances of penetration and growth for the industry. The business norm on the other hand would be - the more the serious players in the distribution of mutual funds, the lesser are chances of investors being misled. So, I think, for AMFI, it is something like what the RBI (Reserve Bank of India) has to do - walk a tightrope - tame inflation (non-serious players), yet help economic (the mutual fund industry's) growth."




7 years ago

I am an ARN holder and my ARN No. 37470 and it is expiring in March 2011. Will u please through lights on this how i have to renew my ARN beyond March 2011. I am 60 years old and cleared my AMFI examination.


7 years ago

1. NISM- MF advisory test is now being held only in the major metros.
2 Making it unviable for 3tier , 4 tier town small entreprenures to attend the exam.
3. How does AMFI/SEBI plan to expand MF distribution in the country?
4. BSE ticket is now available at Rs 10 Lakh only - a broker will trade in MF/Equities/derivatives.
5. Un employed youth could have made a good career in financial advisory , now one has to invest about Rs 10000 - 15000 to come in this line.

P D Vichare

7 years ago

Definitely every system needs to change to keep itself with time. However, one should not expect it overnight. It should be gradual otherwise there will be chaos and will harm the established system.

d k seth

7 years ago

as it is they have no entry load so no commission is paid still the distributer have to settle with this change find a path to do Mf bussiness, which in fact is not sufficient on which one can depend as income for a month as livelyhood, were as on the other hand AMFI has increased the fees which is totally unjustifed but on the other hand they strict nobs for any desreving and professional to be in the financial bussiness as it requirs to hand finance with is invaluable to any invester.


7 years ago

I fully agree to Mr Girishprasad that AMFI fees should be decided by ARN holder depending upon services catered by AMFI-as AMFI gives no other fees except giving certificates then it should be given fees for only certification process-then AMFI should clarify why it wants to raise fees?if it cant clarify & justify-as per new SEBI rules it should reverse it-
rules should be rules for all-not different for different classes-like regulator has different set and regulated have different-
this is not true democracy in this democratic country

Bhupendra Kr Srivastava

7 years ago

The Regulator punishing economicly those, who are serious and honest in their profession & wants to do better.

girish prasad

7 years ago

renewal fees is to be determined by arn holder on the basis to service provided by amfi to the arn holder
this is just like new sebi rules of aug2009 for upfront to distributer?


7 years ago

The renewal fees for individuals should be increased further.Most of the distributors holding ARN are from the families of Mutual Funds' employees,who are highly paid masters and enjoying the investors'money.This is very clear from NAVs Presently investors should not expect any gain from MFs.Once you invest is property MF managers

girish prasad

7 years ago

kill common investor then small time distributor it is rat smell

Aniket Laxman

7 years ago

Any change that afects a large number of people has to well thought of and thoroghly analyzed for its impacts before a decision is made.

I believe the decision makers need to have some introductory training in configuration and release management. This decsipline is typically used by business organizations to manage their IT systems but is eqally useful in any area where a large inventory of pieces of rules & regulations is involved.

The configuration management discipline neccesary deals with the importance of ascertaining what inventory items (of regulations) you have, what puprpose they serve and how they are related to each other.

The release management discipline deals with how the changes need to be clubbed together based on their business impact and urgency. The release frequency is generally pre-decided, typically quarterly and only emergency changes are allowed to make an exception. The result is the predectability of the outcomes and desired level of trust/confidence of all the stakeholders in the systems & processes of the organization.

I think a lesson needs to be learnt from past impulsive decisions like MAPIN database of investors causing a lot of wasteful efforts, time and money.

In sumamry just one sentence, " THINK before you force others to act, Atleast be accountable to yourself".


7 years ago

which makes no sense as when mrkts do crash badly as in2008 ,all ivestors were in heavy lossess whether thy had invested thru the advic of professionals CAs, cfp or none of themutual funds meeting we attended advisd to exit, on the contrary they advised to invest more on the basis of long term
This practice is followed worldwide. Globally, they follow far stricter guidelines but the industry is flourishing because the distributors are also making money. Their yield (commission) is around 3% there but in India the regulators have reduced it to around 1%," added the CFP.

Deepak Bathija

7 years ago

every now & than Sebi is coming with new norms and making it difficut for investors and distributors .
there r humours that they may make it compulsory to go for cfp ccertification
in future,which makes no sense as when mrkts do crash badly as in2008 ,all ivestors were in heavy lossess whether thy had invested thru the advic of professionals CAs, cfp or none of themutual funds meeting we attended advisd to exit, on the contrary they advised to invest more on the basis of long term
it looks that cfp institutes corrupt the entire system to increase their own wealth &income andmake acommon issue like MBA,s for whom it s not so easy even toget job or sufficient earnings compared to currentn inflation
Thanks & Regards

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