No sales growth and continued overcapacity in T & D makers in 2QFY14, says Nomura in its research note
An analysis of the domestic power business of Crompton Greaves, ABB India and other small listed transformer makers suggests that 2QFY14 witnessed a modest margin uptick, says Nomura in its research note on T & D (transmission and distribution) makers in the electrical equipment sector. The margin uptick in most companies is largely driven by cost-efficiency programs and other restructuring efforts rather than actual pricing improvement or economies of scale. For example, ABB India had run into several loss-making projects in its power business, from which it is now coming out from and hence the margin recovery. Among smaller transformer companies, a margin uptick is witnessed only in the case of TRIL, which is primarily led by strong sales growth. However, on a collective basis, 1HFY14 margins for smaller transformer companies are still weaker y-y (year-on-year).
Nomura hastens to point out that the margin uptick in the sector is backed by hardly any revenue growth, which is critical for any sector to sustain a reasonably long period of healthy margins.
The other trend that Nomura points out is that capacity continues to rise for the system as a whole –Chinese companies TBEA and Baoding have already set up manufacturing presence in the country, Toshiba has now entered through its stake purchase in Vijay Electricals, while other existing players, too, keep adding new capacity – the latest being Crompton Greaves, which plans to double capacity over the next two-three years. As such, Nomura does not expect the domestic transformer market pricing scenario to turn favourable any time soon.
For investors, there is some hope as Nomura’s research note says, “Decades of under-investment, followed by a march towards building sufficient power for the nation, have created significant opportunities, although structural constraints and rising competition suggest the need to be selective.” Overall, Crompton Greaves is Nomura’s favourite share in the market other than ABB India.
The CIC issued a show cause notice to erstwhile PIO for not replying within 30 days as mandated under the RTI Act and also for not following orders of FAA. This is the 192nd in a series of important RTI judgements given by former Central Information Commissioner Shailesh Gandhi
The Central Information Commission (CIC), while allowing an appeal, directed the Public Information Officer (PIO) of Food Supplies & Consumer Affairs Department at the Government of National Capital Territory of Delhi (GNCTD), to provide complete information to the appellant about his ration card. The Bench also issued a show cause notice to erstwhile PIO for not replying within 30 days as mandated under the Right to Information (RTI) Act and also for not following orders of First Appellate Authority (FAA).
While giving the judgement on 17 September 2009, Shailesh Gandhi, the then Central Information Commissioner said, "From the facts before the Bench it is apparent that the PIO, KD Trehan is guilty of not furnishing information within the time specified under sub-section (1) of Section 7 by not replying within 30 days. He has further refused to obey the orders of his superior officer, which raises a reasonable doubt that the denial of information may also be malafide."
Delhi resident, Ali Mohammad Saifi, on 2 April 2009, sought from the PIO information regarding his application for ration card. Here is the information he sought...
1. Did Appellant mention House in the IE column of his application form?
2. Appellant requested for photocopy of application form.
3. Has the order to give 12 Kg wheat instead of whole been given and when?
4. Appellant requested for inspecting receipts from November 2008 to March 2009. Why are 12kg of sugar and 5kg of rice given?
The reply provided by the PIO was not enclosed with the appeal to the CIC.
Ali Mohammad Saifi then approached the FAA with his first appeal stating that he did not receive any information from the PIO.
In his order, the FAA directed the PIO to requisite information to the RTI application dated 2 April 2009. Regarding non-receipt of 25 kgs of ration, it was explained by the PIO, that there was some clerical error. The FAA also ordered the PIO to provide the correct information within 15 days.
However, the appellant did not receive any information from the PIO, despite order from the FAA.
Ali Mohammad Saifi then filed his second appeal before the CIC.
During the hearing before Mr Gandhi, the then CIC, the PIO stated the RTI application was not received by him. However, the Bench noted that the appellant had included the receipt no: ED844602289IN issued by Speed Post on 2 April 2009. It is also significant that no such plea of non-receipt of the RTI application has been recorded in the order of FAA, Mr Gandhi observed.
The PIO OP Gupta, who was present during the hearing, stated that he had joined only recently and the person responsible for the delay was KD Trehan (assistant commissioner, East Zone and PIO).
The PIO did not show any evidence that the information had been provided to Saifi. However, he showed documents stating that on 9 September 2009, the grievance of the appellant was resolved.
Saifi, in his second appeal had alleged that a bribe of Rs1,000 was demanded by officials of the public authority to correct mistakes in the name mentioned in his ration card. "The PIO appears to be showing the Commission that the bribe may not have been taken but no information has been given," Mr Gandhi noted.
While allowing the appeal, the Bench directed the PIO to provide complete information to Saifi before 30 September 2009.
Mr Gandhi said, "From the facts before the Commission it is apparent that the PIO, KD Trehan is guilty of not furnishing information within the time specified under sub-section (1) of Section 7 by not replying within 30 days, as per the requirement of the RTI Act. He has further refused to obey the orders of his superior officer, which raises a reasonable doubt that the denial of information may also be malafide. It appears that the PIO's actions attract the penal provisions of Section 20 (1)."
The Bench then issued a show cause notice to Trehan asking him to make a written submission showing cause why penalty should not be imposed on him.
CENTRAL INFORMATION COMMISSION
Decision No. CIC/SG/A/2009/001812/4832
Appeal No. CIC/SG/A/2009/001812
Appellant : Ali Mohd. Saifi,
Respondent : PIO & Asst. Commissioner (East),
Food Supplies & Consumer Affairs Department,
DDA Shopping Complex,
Dayanand Vihar, Delhi-110092
Canara Bank has cut its interest rate on fixed deposit on maturities of 61-90 days to 7.75% from 8.75%
State-run Canara Bank on Tuesday reduced its fixed deposit (FD) rates by up to 100 basis points (bps) or 1% on select maturities.
Canara Bank has cut its interest rate by 1% on maturities of 61-90 days to 7.75% from 8.75%. For maturities of 91-120 days, the new rate would be cut by 0.5% to 8.50%, while for 121-179 days, the FD rate has been reduced by 0.25% to 8.75%, the lender said in a statement.
Besides, FDs of one-two years would now earn 9% compared with 9.1% earlier.
On 29th October, Reserve Bank of India (RBI) had raised the repo rate by 0.25% in its monetary policy review making the cost of fund expensive for banks.
Following the central bank’s move, some banks including Punjab National Bank and Canara Bank raised the interest rates in some maturity brackets by 25-50 basis points.
State Bank of India and HDFC Bank had raised their base rate or the minimum lending rate by 0.2% to 10%.