Rail Budget: Passengers spared hike in fares for third year

Presenting her third budget in UPA-II in the Lok Sabha, railway minister Mamata Banerjee announced a slew of concessions, freight loading of 993 million tonnes and a passenger growth of 6.4%. She also announced 56 new trains, including nine non-stop Duronto trains and three Shatabdis

New Delhi: For the third successive year, the railway budget for 2011-12 spared the passengers of any increase in fares and proposed no hike in freight rates while introducing 56 new trains, including nine non-stop Duronto trains and three Shatabdis, reports PTI.

Presenting her third budget in UPA-II in the Lok Sabha, railway minister Mamata Banerjee announced a slew of concessions including reducing the eligibility age of senior women citizens from 60 to 58 years and the fare concession for men above 60 from 30% to 40%.

Apparently with an eye on the forthcoming assembly polls in West Bengal, where she is projected as the chief minister candidate of Congress-Trinamool combine, she came out with a number of projects for the state, including a metro coach factory in Singur, a rail industrial park in Jelligham, an integrated suburban network for Kolkata and 34 new services for the Kolkata metro.

Her announcements for the state evoked protests from members including those from Bihar, UP and Kerala, but she appealed to them to be patient for her other announcements.

The minister also extended the concession for physically-challenged persons and Kirti and Shaurya Chakra awardees to travel in Rajdhani and Shatabdi trains, besides extending facility of card passes to parents of unmarried posthumous Paramvir Chakra and Ashok Chakra gallantry award winners. She also proposed to induct 16,000 ex-servicemen in the Railways by March.

The budget proposes the highest-ever plan outlay of Rs57,630 crore for 2011-12. The gross budgetary support has been projected at Rs20,000 crore, diesel cess Rs1,041 crore, internal resources Rs14,219 crore and market borrowing at Rs20,954 crore.

The budget estimates for 2011-12 projects a freight loading of 993 million tonnes and a passenger growth of 6.4%.

Gross traffic receipts has been estimated at Rs1,06,239 crore, exceeding the Rs1 lakh crore mark for the first time, despite pressure on finances on account of Pay Commission payout.

Ordinary working expenses have been assessed at Rs73,650 crore and appropriation to depreciation reserve fund pegged at Rs7,000 crore.

Provision of Rs6,735 crore has been made for dividend payment and the excess for Railways for the new fiscal has been projected at Rs5,258 crore, with an operating ratio of 98.1%.

On the financial performance for the current year, the budget disclosed that disruption of train movement resulted in a loss of Rs1,500 crore and Rs2,000 crore due to the ban on export of iron ore. The loading target was reduced by 20 million tonnes (MT) to 924 MT.

Gross traffic receipts have been fixed at Rs94,840 crore, which is higher by Rs75 crore over budget estimates.

The ordinary working expenses has been fixed at Rs67,000 crore, an increase of Rs2,000 crore over BE and the current dividend liability to be fully discharged.

The next year's budget provides Rs9,583 crore for new lines. A target of 1,300 km of new lines, 867 km of doubling of lines and 1,017 km of gauge conversion has been targeted in the new fiscal.

The new Duronto expresses will run between Allahabad-Mumbai, Pune-Ahmedabad, Sealdah-Puri, Secunderabad- Vishakhapatnam, Madurai-Chennai, Chennai-Thiruvananthapuram, Mumbai Central-New Delhi, Nizamuddin-Ajmer and Shalimar-Patna.

Air-conditioned double-decker services are proposed to be introduced on Jaipur-Delhi and Ahmedabad-Mumbai routes.

The three new Shatabdi services will run between Pune-Secunderabad, Jaipur-Agra and Ludhiana-Delhi.

The minister announced the introduction on pilot basis of a pan-India, multi-purpose 'Go India' smart card, which would be a single-window package for passengers for seamless payment for tickets for long distances, suburban, metro journeys. The card can be used at booking counters and on the internet.


Rail Budget: Highlights for 2011-12

Higher outlay without any hike in fares or freight rates, but some new concessions; some new lines, many new trains; upgrading of stations, safety provisions; new production and power units proposed

New Delhi: Following are highlights of the Railway Budget 2011-12 presented by Railway Minister Mamata Banerjee in Parliament today.

  •  No hike in passenger fare and freight rates.
  •  Highest ever plan outlay of Rs57,630 crore proposed for Railways.
  •  Rs9,583 crore provided for new lines.
  •  1,300 km of new lines, 867 km doubling of lines and 1,017 km gauge conversion targeted for 2011-12.
  •  56 new express trains, three new Shatabdis and nine Duronto trains to be introduced.
  •  AC double-decker services on Jaipur-Delhi and Ahmedabad-Mumbai routes.
  • New super AC class to be introduced.
  •  A new portal for e-ticketing to be launched shortly.
  •  Booking charges will be cheaper at only Rs10 for AC classes and Rs5 for all others.
  •  Pan-India multi-purpose smart card 'Go India' to be introduced.
  •  236 more stations to be upgraded as Adarsh Stations.
  •  47 additional suburban services in Mumbai and 50 new suburban services proposed for Kolkata.
  •  Two new passenger terminals proposed in Kerala and one each in Uttar Pradesh and West Bengal.
  •  Feasibility study to be undertaken for increasing speed of passenger trains to 160-200 kmph.
  •  A special package of two new trains and two projects for the states managing trouble-free run of trains throughout the year.
  •  Anti-collision device (ACD) system sanctioned for eight zonal railways.
  •  GPS-based 'fog safe' device to be deployed.
  • All unmanned level crossings (about 3,000) to be eliminated.
  • All India security helpline on a single number set up.
  •  All state capitals in the north-east, except Sikkim, to be connected by rail in the next seven years.
  •  A bridge factory proposed to be set up in Jammu & Kashmir and a state-of-art Institute for Tunnel and Bridge Engineering proposed at Jammu.
  • A Diesel Locomotive Centre to be set up in Manipur.
  •  A Centre of Excellence in Software proposed to be set up at Darjeeling, under aegis of CRIS.
  •  Rail industrial parks proposed at Jellingham and New Bongaigaon.
  •  Additional mechanised laundry units to be set up at Nagpur, Chandigarh and Bhopal.
  •  700MW gas-based power plant to be set up at Thakurli in Maharashtra.
  • 18,000 wagons to be procured during 2011-12.
  • Freight loading of 993 MT and passenger growth of 6.4% estimated for 2011-12.
  •  Gross traffic receipts at Rs1,06,239 crore, exceeding the 1lakh crore mark for the first time.
  •  Ordinary working expenses assessed at Rs73,650 crore.
  •  A scheme for socially desirable projects, 'Pradhan Mantri Rail Vikas Yojana' with non-lapsable fund proposed.
  •  10,000 shelter units proposed for track side dwellers in Mumbai, Sealdah, Siliguri, Tiruchirapalli on pilot basis.
  •  Concession for physically handicapped persons to be extended to also cover Rajdhani and Shatabdi trains.
  •  Concession of 50% to press correspondents with family increased to twice a year.
  •  Senior Citizens concession to be hiked from 30 per cent to 40 per cent.
  •  Medical facilities extended to dependent parents of railway employees.
  • Scholarship for girl child of Group-D railway employees increased to Rs1,200 a month.
  •  20 additional hostels for children of railway employees to be set up.
  •  Recruitment for 1.75 lakh vacancies of Group 'C' and 'D', including filling up backlog of Scheduled Castes/Scheduled Tribes initiated, 16,000 ex-servicemen to be inducted by March 2011.
  •  Separate sports cadre to be created.
  •  2011-12 declared 'Year of Green Energy' for Railways.


MphasiS tumbles 28% on disappointing Q1 results

A decline of about 9% in US dollar revenues in a buoyant economic environment has come as a surprise, especially when MphasiS, a unit of HP, was on a steady growth path for the last several quarters

MphasiS shares tumbled by about 28% to Rs454.10 on Friday following a fall in the first quarter net profit which was below market expectations.

The company was quickly downgraded by IDFC Securities from 'outperformer' to 'underperformer' on account of the disappointing results. There are some unexplained U-turns in the company's first quarter results that raise certain questions, the brokerage said in a research report.

"A decline of about 9% in US dollar revenues in Q1 in a buoyant economic environment was surprising especially when the company was on a steady growth path over the last several quarters (5.8% and 5.4% CQGR for the last four quarters and eight quarters, respectively)," IDFC stated in the report. "The company had not indicated any challenges on the growth front at the recent analysts' meet; on the contrary, it spoke about 2,400 open positions in applications/ ITO as of October 2010 end."

For the first quarter to end-January, the IT and BPO company reported a fall in net profit at Rs226.70 crore even as its total revenues increased to Rs1,233.50 crore from the corresponding period a year ago. During the quarter, MphasiS, which is majority-owned by Hewlett-Packard Co, reported a 10% fall in HP channel revenues to Rs840 crore, while its direct channel revenues declined 3% to Rs380 crore. The company's days sales outstanding (DSO) increased significantly to 94 days from the historical range of 70-80 days.

MphasiS follows a fiscal year from November through October, in line with the practice at H-P, which acquired MphasiS' parent Electronic Data Systems Corp. in May 2008. Hewlett-Packard also reported lower-than-expected results for the first quarter to end-January. The company registered a 4% increase in revenues at $32.3 billion from $31.1 billion a year ago. Mphasis derives more than 85% revenue from ITO and application services, and both these businesses have been weak in the case of HP.

IDFC said, MphasiS has reduced disclosure levels. It has stopped reporting revenues/segment profits by earlier segment definitions (application, ITO and BPO) and instead now presents segment reporting by verticals. The company has also stopped reporting other details like revenues by geographies and billing rates.

"Whether quarter-on-quarter (q-o-q) decline is a change in growth trajectory or just a quarterly hiccup is still debatable. However, even a quarterly hiccup warrants significant cuts in earnings per share (EPS)-we reduce our Oct-11 estimated (E) EPS by about 18% and Oct-12E EPS by around 14%-despite building a 6% compounded quarterly growth rate (CQGR) for the next seven quarters. We now value MphasiS at Rs610, based on 14x Oct-11E EPS (from Rs850 based on 15x Oct-11E EPS). We do not roll forward earnings and reduce our target multiple by a notch to account for the reduced confidence on business growth. Downgrade MphasiS stock to underperformer," the brokerage stated.

The MphasiS stock closed the day at Rs448.40 on the Bombay Stock Exchange, down 28.43%, while the benchmark Sensex was up 0.4% at 17,700 points today.




6 years ago

deliberate attempt with a view to delist. Moneylife and other investors forum to view this seriously so that recurrence is avoided in other MNCs.


Debashis Basu

In Reply to sudeer 6 years ago

Very astute comment.

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