Can manage without capital infusion from govt this fiscal: SBI

The state-owned lender has been contemplating a Rs20,000 crore rights issue for nearly a year now, but is yet to get a go-ahead from the government, which owns a 59.40% stake in the bank

Mumbai: Even as its long-standing demand for a rights issue is pending, the country's largest lender State Bank of India (SBI) today said it can manage without a capital infusion from the government this fiscal, reports PTI.

"We cannot sustain without capital infusion from the government in the long-term. So it's a crisis situation if we don't get capital, but we have 'Plan B' to sustain this year, we will be able to manage in FY11-12," SBI chief financial officer Diwakar Gupta told reporters on the sidelines of a Ficci-IBA event here.

The state-owned lender has been contemplating a Rs20,000 crore rights issue for nearly a year now, but is yet to get a go-ahead from the government, which owns a 59.40% stake in the bank.

In the event of capital infusion not happening this fiscal, Mr Gupta said SBI's 'Plan B' entails tapping other instruments like retail bonds to augment its capital base.

"Plan B is other instruments for raising quasi capital like Tier-I or Tier-II. We may look at retail bond issue if demand picks up, but we don't have liquidity issues now," he said.

Mr Gupta, however, said that the bank will 'definitely' need capital next fiscal. "We cannot sustain without a capital infusion from the government in the long-term," Mr Gupta said.

The bank's credit growth guidance for the current fiscal is 16%-18% per cent, Mr Gupta said, adding that there is no point in being aggressive on this front and compromising on asset quality.

Mr Gupta said small and medium enterprises are the most affected by the current scenario, as they are pinched by both demand for goods going down and interest rates going up.

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Cement prices may recover post-monsoon, says CMIE

Cement prices have declined following sluggish demand from May onwards. Prices in Mumbai, Delhi and Kolkata market are down from their peak levels of March-April 2011, CMIE said in its monthly review

Mumbai: With construction activity likely to pick up post-monsoon, cement prices are expected to recover, reports PTI.

"We expect cement prices to recover after rains. With the construction activity expected to pick up post-monsoon, demand is likely to rise," Centre for Monitoring Indian Economy (CMIE) said in its monthly review here.

Cement prices have declined following sluggish demand from May onwards. Prices in Mumbai, Delhi and Kolkata market are down from their peak levels of March-April 2011, it said.

Prices in Mumbai market were down to Rs276 per 50 kg bag in July 2011 from Rs283 per 50 kg bag in April. In the Delhi market, cement prices declined to Rs256 per 50 kg bag from the peak level of Rs261 per 50 kg bag in April. Prices in Kolkata market have come down to Rs247 per 50 kg bag during the month from its peak level of Rs298 per 50 kg in March.

However, prices in the southern region are bucking this downward trend as they remained stable. Prices in Chennai and Hyderabad market remained almost stable at their peak of April 2011, in the month of July 2011.

Meanwhile, cement dispatches grew by 10.1% in July 2011.

All-India cement dispatches (including ACC and Ambuja) reported strong year-on-year (YoY) growth of 10.1%. Cement demand improved YoY in all regions except for southern region in July 2011.

Industry has reported a double digit volume growth for the first time in last six months, primarily due to lower base (in July 2010, cement dispatches had declined 3.9% due to heavy rains) and modest improvement in cement demand.

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RIL regains country’s most-valued firm status

RIL commanded a market value of Rs246,995 crore at 0945 hours on the Bombay Stock Exchange, followed by Coal India which stood second at Rs244,190 crore at the same time. ONGC, was at third position, with a market value of Rs243,831 crore

Mumbai: Billionaire Mukesh Ambani-led Reliance Industries (RIL) today regained its status as the country's most-valued company, relegating Coal India (CIL) to the second position in early trade, reports PTI.

RIL commanded a market value of Rs246,995 crore at 0945 hours on the Bombay Stock Exchange (BSE), which was higher than any other listed company.

In comparison, the market value of CIL, which had dethroned RIL to emerge as the country's most-valued firm last week, stood at Rs244,190 crore at the same time.

Another state-run company, ONGC, was close behind at third position, with a market value of Rs243,831 crore.

Shares of all three companies were trading in the red today but the losses were sharper for CIL.

While RIL was down 0.26% at Rs754.30, ONGC was down 0.62% at Rs285 and CIL was 2.2% in the red at Rs386.60.

After reigning as the country's most-valued firm for more than four years, RIL slipped to second position behind CIL last week. Days later, RIL had briefly slipped to the third position after CIL and ONGC on 19th August, but managed to regain the second slot by the time the market closed.

Nevertheless, RIL was back on top this morning and marketmen will be keenly watching the three stocks to ascertain whether the market valuation charts undergo further changes.

Interestingly, RIL had toppled state-run ONGC over four years ago to become the India's most-valued firm, but slipped below the two public sector firms in terms of market valuation in intra-day trade last Friday.

A company's market valuation, or market capitalisation, is determined by multiplying its share price by the total number of shares.

CIL and ONGC had been closing the gap on RIL in terms of market valuation for the past few weeks, as RIL's stock has been under selling pressure and the two PSUs have been mostly performing well even in a weak market.

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