New Delhi: The decade gone by saw the Indian companies mopping up a staggering Rs2 lakh crore through 385 public issues, riding high on blockbuster initial public offerings (IPOs) like Reliance Power and Coal India, reports PTI quoting a report.
In a review from 2001-2010 on the Indian public issue market, the Indian corporates have raised about Rs2,09,400 crore, SMC Global Securities Limited said in a report.
“It was the decade when the Indian capital markets and Indian economy came into the radar of the global observers.
During the period, the Indian public issue market has seen quite fascinating phases,” SMC Global strategist & head of research Jagannadham Thunuguntla said.
The report noted that the Indian capital market saw only nine public issues during 2001-2003, through which about Rs2,500 crore was raised, as the local market was grappled with negative sentiment ranging from the dotcom bubble burst in the US economy to the Ketan Parekh (stock scam) episode.
However, this was the time when the country saw the high-profile issues including Bharti Airtel, Maruti Suzuki and i-flex.
In fact, the carmaker Maruti Suzuki’s IPO became iconic in the public issue market history, which in a way paved way for disinvestment prospects in the country, the report added.
Party for the Indian IPO market started in 2004, when global investors and FIIs started investing billions of dollars into the Indian markets as well as in Indian IPOs. The period from 2004-2007 witnessed 246 public issues, managing to raise about Rs1,01,000 crore.
Highlights of the period were—ONGC follow-on public offer (FPO), ICICI Bank FPO, NTPC IPO, TCS IPO, the report said.
Going forward, from 2008-2009, the market welcomed the mega IPO of Reliance Power. This public offer attracted heavy investor participation, especially, from the retail bidders.
However, later in 2008, the world witnessed unprecedented events of collapse of some of the iconic names in the US economy, like the Lehman Brothers crisis, which led to the crash of the public issue market in 2008.
During 2008-2009, there were 60 public issues by which about Rs34,306 crore were garnered. The major issues during this period were—Reliance Power IPO, NHPC IPO, Oil India IPO and REC IPO.
In 2010 alone, about 70 public issues saw light of the day, raising Rs71,000 crore. Interestingly, calendar year 2010 also saw the highest ever public issuance volume than any other year.
The year had also seen aggressive disinvestment thrust from the government, helping the overall robustness of the public issue market.
The list of heavyweight IPOs include Coal India IPO, MOIL IPO, SJVNL IPO, NTPC FPO, NMDC FPO.
A study by SMC noted that the top 10 public issues in 10 years including those of CIL and Reliance Power have collected an aggregate of about Rs93,800 crore.
New Delhi: Pratip Chaudhuri, currently deputy managing director and group executive, international banking, of State Bank of India (SBI), is understood to be leading race for the top job of the country’s largest lender, reports PTI.
Besides, Hemant G Contractor, chief finance officer and Diwakar Gupta deputy managing director and group executive (rural business and national banking) is also believed to be in race for the job.
The vacancy would arise as the incumbent O P Bhatt five-year term comes to an end in March 2011.
The name would be finally cleared by Appointment Committee of the Cabinet (ACC) headed by the prime minister Manmohan Singh. The other members include home minister P Chidambaram and finance minister Pranab Mukherjee.
It is believed that ACC approval would come before the term of incumbent ends.
Mr Chaudhuri joined SBI as a probationary officer in 1974. He took over charge as DMD (international banking) in April 2009.
The search panel to appoint the next SBI chairman, headed by Reserve Bank of India (RBI) governor D Subbarao, had interviewed 4-5 candidates earlier this month.
Besides, names of the managing directors of the bank would also be cleared by the government.
Currently, there is only one managing director in the bank against the provision of four. SBI managing director R Sridharan is due to retire in June 2011.
Kolkata West International City, promoted by Prasoon Mukherjee and the controversial Indonesian company which was involved in the Nandigram chemical hub project, is nowhere near completion after five years
While driving down from Durgapur and Burdwan to Kolkata, along the Kona Expressway, just before entering the state capital, you will pass a pristine white gate with a high arch and black wrought-iron horses at the top. It's the landmark for the sprawling 400 acre Kolkata West International City (KWIC) which has been coming up for some years now.
This view hasn't changed much in five years. One of the biggest real estate projects in the country-perhaps the biggest-financed by foreign direct investment (FDI), KWIC is far from being completed and numerous plot owners who have a stake in the project are sorely disappointed at being left in the lurch.
KWIC had promised to hand over 900 bungalows by the end of 2008, or the first quarter of 2009, in the first phase, but it has managed to complete only 200 till now. Today, the company is finding it difficult to persuade the owners to occupy their bungalows which stand in the middle of a vast stretch of uninhabited land, devoid of basic infrastructure.
The management had admitted its helplessness over the delay in the completion of the project and is paying 3.5% interest to buyers on the amount they have paid for the properties they have booked. That's little solace for people who have taken large loans at pretty high rates to buy flats, bungalows and commercial units in the range of Rs25 lakh to Rs1 crore.
Now, the company says that the project will be finished by 2012-all the 6,100 bungalows and flats, a road network, amenities like parks, gyms, shopping centres, and also schools and hospitals.
The delay has been attributed to the pullout from the project by co-developers Ciputra Group and Unitech. But serious questions have also been raised about the poor quality of the construction work being undertaken.
Prasoon Mukherjee of Singapore-based Universal Success Enterprises, which is promoting the project together with Indonesia's Salim Group, says the work was stalled due to a lack of funds. But activist Harish Maheshwari points to the company's balance sheet for the year ended March 2010, which shows a profit of Rs21 crore.
In a letter to Moneylife, Mr Maheshwari says, "The share capital and application is Rs48 crore, secured loans are Rs58 crore and unsecured loans are Rs5 crore. Against these the fixed assets are Rs9 crore. The current assets and liabilities ae Rs101 crore and the loss is Rs1 crore. Despite not even 2% of the project being complete, the company has been able to reduce its losses of Rs22 crore in March 2008 to Rs1 crore in March 2010. In other words, it has earned a profit of Rs21 crore in two years on just 2% of the project."
When the properties were booked back in 2006-07, most of the customers had paid the amount in full, so they are surprised at the excuse of a funds crunch. KWIC officials were not available for comment.
There is another problem for the Howrah Municipal Corporation. Back in 2007, the civic body had agreed to supply two million gallons of water from the Padmapukur reservoir to KWIC, despite its inability to supply sufficient water to most other parts of the city. But with the project largely incomplete and not occupied, the municipal corporation is losing huge revenues.
There is also an issue involving the Kolkata Metropolitan Development Authority (KMDA) which has leased out a vast stretch of land for only Rs96 crore. A KMDA official said, "Yes, the project has been delayed, but it will be completed soon. I don't know about the details of the land lease agreement, the documents will have to be searched."
KWIC was West Bengal chief minister Buddhadeb Bhattacharjee's dream initiative. It is important to mention that the Salim Group, promoters of KWIC, had also planned the chemical hub in Nandigram, where land acquisition for that project set off tragic violence three years ago.
Already disgraced in Nandigram and Singur over the Tata Nano project, it is very unlikely that the Left Front government will do anything to rescue KWIC before the state elections that are due in a few months and this could see the project immobile for a while longer, like the rusted horses that stand frozen, mid-motion, atop the gateway to the proposed city.