Kingfisher management has once again assured the employees of remitting the January salaries by 15th May, and a part-payment of the February dues would follow soon
New Delhi/Mumbai: A section of Kingfisher Airlines pilots on Friday called off their two-day-old agitation over non-payment of salaries after some tough talk by the carrier's chief Vijay Mallya, who vowed to deal with the situation "firmly", reports PTI.
The pilots decided to return to work following a meeting with the the airline management in New Delhi after flights were cancelled for the second day today. The stir added to the woes of passengers already hit by Air India pilots agitation.
The airline was forced to cancel 12 flights from Delhi and Mumbai today as around 70-odd pilots from north India did not report for duty. It cancelled 17 flights yesterday.
The management has once again assured the employees of remitting the January salaries by 15th May, and a part-payment of the February dues would follow soon, airline sources told PTI.
"In view of the developments, the pilots, who had been reporting sick since yesterday, have decided to withdraw their agitation and resume duties," they said.
According to the sources, the meeting came a day after Mr Mallya sent a strong message over the agitation in a communication to the employees. "I will not allow a small group of misguided employees to derail and jeopardise the efforts of several thousand members of our family and all the stakeholders in Kingfisher Airlines. I will act firmly and decisively in order to protect our guests, our loyal and dedicated employees and our Company," Mr Mallya said.
Around 1,800 employees have already received their salaries which include some co-pilots, sources said, adding that "Mumbai pilots have (already) decided to fly". The airline currently has around 7,000 workforce.
"We managed to earn credibility and loyalty amongst our dear guests with a stable 'holding schedule' with good integrity and on time performance. Unfortunately, as a result of actions by a few, this and the dedicated efforts and passion of all of you could be at risk," the Kingfisher chief said.
Kingfisher Airlines has been facing financial troubles for almost a year now. The airline reported a net loss of Rs444.26 crore in the December quarter. It suffered a loss of Rs1,027 crore in 2010-11 and has a debt of Rs7,057.08 crore.
Prefabs and monolithic maker, Sintex, has reported a sharp decline in its net profit for the year while the board has announced dividends despite urgent need to pay off FCCBs
Sintex Industries, a leader in monolithic and prefabs business, has reported 35.76% decline in its standalone net profits on lower sales (down 1.91%) for the fiscal 2012. It recorded Rs229.70 crore in net profits on back of Rs2568.21 crore of sales, a margin of 8.94%. The margins shrank by 471 basis percentage points from 13.65% over the course of the year, which is steep. According to the company's press release, it said, "FY12 has been a challenging year. A glaring slowdown domestically in the government business and a global recession led to underutilisation of capacities and reduced margins."
It has to be noted that the company is sitting on $225 million of Foreign Currency Convertible Bonds (FCCBs), which has to be repaid by March 2013 at a trigger price of Rs247. Currently, the stock is quoting at Rs58.65, which is a long way off from the trigger price.
An FCCB is a type of loan, which foreigners give to a company in lieu of either equity conversion or principal repayment. If the stock is doing well and goes up, the lenders may opt for equity conversion. However, the stock has been battered on poor cash flows and inability to meet its obligations. Because the stock price is unattractive, the lenders will opt for having their principal back. Sintex will either need to generate more business to repay on time, otherwise it will have to borrow more or raise extra capital from elsewhere. The former looks unlikely given the policy paralysis by the government. It could also renegotiate terms, but that means higher interest charges.
The rupee depreciation has also hit the company since FCCBs need to be paid back in the currency it was issue, in this case, the dollar. However, more pertinently, Sintex, instead of conserving cash to allocate towards debenture redemption reserve (every company is required to maintain this towards FCCB repayment), it has decided to pay out dividends instead. The company's board declared a dividend of Rs0.65 per share, which amounts to Rs17.74 crore, more than half of the Rs33.27 crore already in the debenture redemption reserve. This move is to presumable to pacify shareholders and increase its stock price. We feel that this is a negative move.
Much of its revenues accrue from its monolithic construction segment, which de-grew by over 6%. This involves building low cost housing, mostly for slum redevelopment and providing low-cost housing to the poor. The government is one of its main clients. Custom moulding, another segment which caters mainly to the automotive segment, saw its sales marginally increase by over 3%.
Recently, on 7 May 2012, Morgan Stanley Asia Singapore Private, an institution, had sold 15,61,553 shares at Rs62.71 apiece. Earlier, it has bought a bulk of the shares at higher prices.
The ministry of health and family welfare has set up a three-member committee to examine validity of the scientific and statutory basis adopted for approval of new drugs without clinical trials. The committee has been asked to submit its report within two months
The ministry of health and family welfare has set up a three-member committee to examine the report of the parliamentary panel which had accused the regulatory body-Drugs Controller General of India (DCGI)-of favouring pharmaceutical companies by approving drugs without conducting mandatory clinical trials. The report had also pointed lapses in the approval procedure for new drugs.
Ghulam Nabi Azad, minister for health announced that the committee consisting of Dr VM Katoch, secretary and director general of Indian Council of Medical Research, Dr PN Tandon, president, National Brain Research Centre, (department of Biotechnology, Manesar) and Dr SS Aggarwal, former director, Sanjay Gandhi Postgraduate Institute of Medical Sciences, Lucknow will examine the validity of the scientific and statutory basis adopted for approval of new drugs without clinical trials.
The committee has also been asked to outline appropriate measures to bring about systemic improvements in the processing and grant of statutory approvals and suggest steps to institutionalise improvements in other procedural aspects of the functioning of the Central Drugs Standard Control Organization (CDSCO). The committee has been asked to submit its report within two months.
The report tabled in the parliament on 8th May by the Standing Committee on Health and Family Welfare pointed the laxity in India's drugs regulation and stated that the DGCI is approving one drug every month without trials.
Based on information provided by the ministry, the panel said that 31 new drugs were approved in the period between January 2008 and October 2010 without conducting clinical trials on Indian patients. It also said, "There is sufficient evidence on record to conclude that there is collusive nexus between drug manufacturers, some functionaries of CDSCO (Central Drugs Standard Control Organization) and some medical experts." The CDSCO is headed by DCGI.
The panel revealed that many such drugs which are banned in developed countries like the US, UK, Australia are sold in India. The panel, which investigated and reviewed the drug regulation in India for 18 months, randomly picked up 42 medicines for scrutinising its approval status. Apart from approving drugs without mandatory clinical trials, the panel found that in case of Novartis' Everolimus, UCB's Buclizine, Eli Lilly's Pemetexid and Theon's fixed dose combination of Pregabalin, no expert opinion was sought and they were approved by the non-medical staff of CDSCO. While in case of case of 25 drugs opinion of medically qualified experts was not obtained before approval.
The report also mentioned that pharmaceutical majors like Ranbaxy, Cipla, USV and Lundbeck are advertising prescription drugs, falling under Schedule H, which is not permitted in India. (Advertising of prescription drugs by pharma companies shocks govt panel)