WiMax rollout may be delayed: Telecom Secretary

New Delhi: The dispute between the Department of Space (DoS) and Department of Telecommunications (DoT) over vacation of broadband wireless access (BWA) spectrum can delay WiMax rollout, a senior official said here Monday.

WiMax or wireless Internet is essential for increasing broadband penetration in the country - especially in rural areas. However, its rollout will be hampered as a result of the differences between the two departments over vacation of spectrum by DoS.

"DoT is looking at two options, whether to defer the auction or issue conditional licences - meaning roll out the service as and when the spectrum is available," Telecom Secretary Siddhartha Behura told reporters on the sidelines of a conference.

The DoS believes the WiMax operations will interfere with sensitive satellite communications in adjacent spectrum bands.

Behura, citing the example of England where WiMax rollout was deferred by a year due to unavailability of BWA spectrum, said the government is considering the issue and something would be worked out soon.

Last week, the empowered group of ministers (EGoM) set up to resolve third generation (3G) and BWA spectrum-related issues set the base price for BWA spectrum at Rs.1,750 crore for a pan-India rollout.

Only three slots will be auctioned initially, with one slot already reserved for the two state-run telecom operators - Bharat Sanchar Nigam and Mahanagar Telephone Nigam.

Broadband penetration in India on the rise

Bangalore: According to a recently released data from the Indian government, the total broadband subscriber base rose to 6.8 million in July from 6.62 million in June, up by 2.7 percent. The Indian government defines broadband as internet connectivity of speed at or higher than 256 kbps.

As there are five major telecommunication companies in India: Bharti, Reliance, Tata and state-owned BSNL and MTNL, they have a better chance to embark on the market by subsidizing the $500 netbooks which come with 10 inch screens.

Nokia can jump up in this internet ecosystem which is already vibrant despite low broadband and PC penetration. According to the report by Trendspotting, there are about 54 million active internet users in India who use Google, watch video on YouTube and have been highly attracted by Facebook. The number of Indian users of Facebook has risen 156 percent in the past 12 months. Also, India is among top 10 Twitter user countries in the world.

Yahoo India shuts social network 'SpotM'

Bangalore: Yahoo India will shut down SpotM, the social network it launched less than a year ago in India. The social network which never exited private beta and was meant for the 16-24 age bracket, will not be in service from September 1.

SpotM was not able to keep up in the race with other social networking sites which dominate the market in India. Google's Orkut leads the race with 16 million unique visitors in July, according to comScore statistics. Facebook touched 7.5 million unique visits in July according to comScore statistics. Facebook is even available in several Indian languages like Hindi, Bengali, Punjabi, Telugu, Tamil and Malayalam.

SpotM was expected to gain success due to popularity of social networks in India and with addition of a few differentiating features. It has features which would allow users to make friends with other users and make them private in case they do not want to disclose their relationship. SMS integration would allow users to correspond through SMS without revealing their phone numbers.

Yahoo is believed to be concentrating more on recently launched Yahoo Meme.

And now, India plans mission to Mars after 2015

Bangalore: India will embark on an unmanned mission to Mars after 2015 to explore the red planet in quest of its space ambitions, a senior space official said Monday.

Clarifying the statement made by Indian Space Research Organisation (ISRO) Chairman G. Madhavan Nair at Panaji earlier in the day on the Mars mission, the space official said such a mission was not feasible before 2015 as the space agency will be pre-occupied with its second lunar mission (Chandrayaan-2) in 2013 and a manned mission to space by 2015.

"We plan to undertake missions to Mars and other planets as part of our long-term space expeditions. We will ask the scientific community to propose the experiments to be carried on the Martian surface. We may also invite international space agencies to participate in the mission, as in Chandryaan-1," the official told IANS but declined to be named.

As the fourth planet from the sun in the solar system, the distance between earth and Mars varies from 36 million miles when nearest, to 250 million miles when farthest in its elliptical orbit around the sun.

Though the government sanctioned Rs.100 million (Rs.10 crore) on Aug 13 as seed funding for the Mars mission, a lot of ground work has to be done for preparing the project report.

"The mission to Mars is being conceived as low-cost planetary missions. For instance, Chandrayaan-1 is the finest example of a low-cost mission, as we were able accomplish it at a cost of $80 million (Rs.380 crore) while such missions by other space agencies are considered low-cost at $500 million," the official claimed.

To prepare a project report for government approval, the space agency will elicit the opinion of the scientific community on the viability of such a mission and evolve a concept paper.

"It is too early to estimate the cost of the mission to Mars. At current prices, it will be twice the cost incurred in the maiden moon mission, which was Rs.380 crore. We have to start from scratch to build a spacecraft, the launch vehicle and other support systems to operate the mission, which will last more than a year or two," the official noted.

The space agency plans to use the powerful geosynchronous satellite launch vehicle (GSLV) Mark-III for the Mars mission, as the spacecraft had to be first put in the earth's orbit and raised up to Martian orbit, using ion thrusters and liquid engines.

"It is too early to talk about the mission's journey as we are yet to design the spacecraft and build the advanced version of the rocket (GSLV-3). We have a long way to go," the space official added.

Incidentally, the maiden moon mission was aborted Sunday after the space agency's deep space network at Byalalu, about 40 km from here, failed to restore radio contact with the 514 kg spacecraft, which is orbiting about 200 km away from the lunar surface.

Though the U.S. and Russia had launched missions to Mars, other space-faring nations such as China and Japan are planning to join the Martian race as part of their planetary expeditions. Even the European Space Agency (ESA) is mulling a joint mission to Mars in the coming decade.

Recession, drought will hit India's growth target

Bangalore: Global recession and drought will bring down India's nine percent growth target for its 11th Five Year Plan (2007-12), Planning Commission Deputy Chairman Montek Singh Ahluwalia has said.

"We set a growth target of 9-10 percent for the 11th Plan. Though we began well in the first year (2007-08), the global meltdown impacted the growth rate in the second year and a drought this year will hamper it even more," Ahluwalia told IANS here.

The robust nine percent growth rate in 2007-08 slipped to 6.7 percent last fiscal and is projected to fall to 6.5 percent this year.

"If the growth rate for two consecutive years is about 6-6.5 percent on an average, the economy has to grow by 11 percent in the remaining two years of the Plan period to achieve the nine-percent target, which I don't think is possible," Ahluwalia said.

The commission will revise the growth target when it meets in December for a midterm appraisal of the 11th Plan, with a better assessment and a course correction this fiscal.

"We will see what adjustment needs to be done during the midterm appraisal. We should not regard the decline in growth as a failure or weakness, because contributing factors like global meltdown and a weak monsoon are beyond our control," said Ahluwalia, one of India's key economic policymakers.

The first meeting of the reconstituted Plan panel Tuesday in New Delhi, under the chairmanship of Prime Minister Manmohan Singh, will set the tone for the midterm appraisal of the 11th plan after factoring in India's economic health.

Admitting it was difficult to meet a five-year target when the external environment changed midstream, Ahluwalia said the priority was to ensure the growth path was on sustainable ground.

"Our economy is going through two difficult years and the world economy will take a year more to recover from the global recession. The measures taken by the government during the past eight months are aimed at a stronger economic performance though we have a lot of work to do," he said.

Clarifying that planning was not a mechanical exercise undertaken once and adhered to it for five years, Ahluwalia said a midterm review was essential for course correction.

"Global recession and drought are unforeseen events that disrupt growth momentum and the cyclical nature of many economic sectors. Midterm appraisal will allow us to redefine priorities and review policies."

A weak monsoon and slowdown are feared to limit the growth rate of the gross domestic product (GDP) to less than seven percent this fiscal.

"Though drought will be a problem this year, we expect a strong rebound in the farm sector next year. But for the weak monsoon, the growth rate would certainly have been above seven percent this fiscal," Ahluwalia said.

Even as a drought looms large, with loss of farm production, lower income for farmers and fall in demand for goods and services, he said food stocks were adequate.

Kingfisher Airlines to raise $100 Million

New Delhi: Vijay Mallya-owned Kingfisher Airlines Monday said it planned to raise $100 million (about Rs.500 crore) in Global Depository Receipts (GDRs).

In a regulatory statement to the Bombay Stock Exchange (BSE), it said the funds would be raised subject to shareholders' approval.

It also apprised the BSE of a decision taken July 28 to induct up to $100 million by way of a rights issue.

The board also approved raising the company's authorised share capital to Rs.1,000 crore from Rs.500 crore, subject to shareholders approval, Kingfisher said.

Currently, the airline has been reporting losses of over $240 million (Rs.1,200 crore).

ICICI Prudential launches R.I.G.H.T Fund

Bangalore: ICICI Prudential Mutual Fund has launched its new equity scheme named as 'ICICI Prudential R.I.G.H.T. Fund (Rewards of Investing and Generation of Healthy Tax Savings)'. This close-ended equity linked savings scheme has been launched to generate long-term capital appreciation from a portfolio that is invested predominantly in equity and equity related securities of large capitalization companies and emerging mid cap companies along with income tax benefit.

The investment policies shall be framed in accordance with SEBI (Mutual Funds) Regulations, 1996 and rules and guidelines for ELSS (Equity Linked savings Scheme), 2005. However, there can be no assurance that the investment objective of the scheme will be realized.

The minimum investment amount for the scheme is Rs.500 and in multiples of Rs.500 thereafter. The scheme will invest up to 80 percent-100 percent in equity and equity related securities with high risk profile and up to 20 percent of the assets may be invested in debt. The scheme will invest in securitized debt up to 50 percent of debt portfolio, only if it is permitted under the ELSS guidelines in future.

Being a close ended ELSS, investors can subscribe to the units under the scheme during the NFO (New Fund Offer) period only. The scheme will charge an entry Load of 2.25 percent for investments of less than Rs.5 crore of applicable NAV (Net Asset Value). For investment of Rs.5 crore and above, there will be no entry load charge. An investor will have to pay two percent of applicable NAV as exit load charge, if he redeemed within two years after completion of three years lock-in period and will not be charged thereafter.

Benchmark Index for the scheme is S&P CNX Nifty Index. Prashant Kothari is appointed as the Fund Manager of the scheme.

NHPC fails to power on debut; what should investors do now?

Just when the initial public offering (IPO) fever seemed to be heating up comes the dampener. NHPC, the power company from the government’s stable, listed today on the stock exchange amid much fanfare but came a cropper — it traded well near the issue price of Rs 36 all day long. This, after private sector power company Adani Power, which listed recently, met with the same cold treatment from the market. While analysts blame high valuations in case of both NHPC and Adani Power, lead manager Enam Securities says it’s time to stop the flipping game and look at long-term buying. NHPC: What’s the view? Most analysts blamed pricing for the lukewarm debut. Sanju Verma of Universal Proactive Group, who had for long been maintaining the issue was highly priced, said she would stay awayfrom both NHPC and Adani Power — but if asked to make a choice, she would go for the latter. “NHPC did not really have too much going for it,” Verma said, adding, “If you are talking about the short term, FY10 EPS growth will barely be 9%, yes, FY11 will be a whopping 75% plus but that is off a very low base.” “Why should NHPC trade at a market cap to NAV of something like market cap or mega close to 9 times when NTPC is trading at 5 times?” she asked. Verma added that she would rather buy Power Grid and Tata Power than the two recently-listed power companies. Enam says Enam Securities Chairman Vallabh Bhanshali, the lead book manager for both NHPC and Adani Power, said he was intrigued but not disturbed by the market’s response to the listing. “People should not get swayed by whatever may happen in the short to medium term,” Bhanshali said. “We have seen the performance of companies like REC and some other companies where investors may have taken a short-term view and regretted. These are great companies, very difficult to duplicate and the business is all about the barrier that you have around it.” Bhanshali added that NHPC was an under-leveraged company and that its return on equity (RoE) would increase as it leverages its cash flow to build projects. When asked to comment on NHPC’s pricing, Bhanshali said, “The IPO market has just about opened and therefore issuers, bankers, investors all are struggling on how to price the IPO and it will settle down as we have more examples.” He added that even though Adani Power and NHPC — “companies with good management and sector” — saw a listless debut, it was too short a period to take a call on whether the pricing was improper. What should investors do now? NHPC may now continue to remain in a range of about Rs 36-39, Investment Analyst SP Tulsian said. “My advice to both high-net-worth individuals and retail investors should be to exit the stock.” “When we wrote our IPO research note to clients, we did a discounted cash flow (DCF) valuation of about Rs 37.20 and told our clients to avoid NHPC just because there wasn’t anything in it for them to buy at this price,” Satish Betadpur, CFA, Global Research Director at Independent International Investment Research PLC, said. Betadpur added that investors could have bought NHPC had the stock listed at Rs 30 levels — the lower end of the price band. “One thing that comes out of this listing is: pricing is very important. Even though we like the sector but being the highest priced entity within the sector, the stock doesn’t deserve it,” he said. “At this point, we will tell our investors to hold off, get back into it closer to Rs 30 because it is a good stock for the long run. It’s just over priced at this point.”

Sensex pares early gains, ends 115 pts down

The bulls, who had taken a retreat on Monday after calling the shots for seven successive sessions, came back strongly this morning with a firm trend on the Asian bourses and fairly buoyant industrial output data turning them on. However, after staying rooted to the ring till an hour past noon, they started slipping away to the sidelines following a weak start in European markets. U.S. index futures drifted lower, suggesting a negative start for Wall Street.

From a high of 15,923.09, the Sensex plunged to 15,475.28 - the fall was incredibly swift - as stocks cutting across sectors gave up their gains and tumbled on heavy selling around mid afternoon. There were a few mild recoveries thereafter, but the barometer eventually ended the session with a sharp loss of 115.45 points or 0.74% at 15,551.19.

The Nifty index of the National Stock Exchange, which rose to 4735.90 in early afternoon trade, ended the day at 4625.35 with a loss of 36.75 points or 0.79%. The Nifty drifted down to a low of 4600.65 today.

The mood changed quite cautious this afternoon after Planning Commission Deputy Chairman Montek Singh Ahluwalia said India's economic growth in the coming two quarters will be lower than April-June.

According to the data released by the government today, India's exports fell an annual 28.4% in July 2009 over July 2008 and imports fell 37.1%.

Realty stocks, which opened on a bright note and stayed firm for well over a couple of hours, ended with sharp losses today. Metal, power, capital goods and pharma stocks also declined sharply. Oil stocks were also seen struggling this afternoon.

Automobile stocks had a fairly good session thanks to reasonably good sales figures for August. Select information technology and FMCG stocks closed on a firm note. Bank stocks exhibited a mixed trend.

Midcap and smallcap stocks failed to hold early gains. Wilting under pressure, several stocks from these segments ended with notable losses today.

ACC lost around 3.6%. Sterlite Industries, HDFC, BHEL and Jaiprakash Associates ended lower by 2.25% - 3%. ONGC, Hindalco and Reliance Infrastructure lost close to 2%.

DLF, Tata Steel, HDFC Bank, Mahindra & Mahindra, NTPC, Grasim Industries, Larsen & Toubro and Reliance Industries also closed on a weak note.

Unitech, Cairn India, Siemens, SAIL, Ranbaxy Laboratories, ABB, Jindal Steel, Idea Cellular, Tata Communications, Axis Bank, Reliance Power and Reliance Capital were among the prominent losers in the Nifty index.

Maruti Suzuki rallied sharply and ended stronger by 7.65% on impressive sales figures. Tata Motors ended with a gain of 5.8%. Hero Honda moved up by 1.55%. Wipro, Reliance Communications, Hindustan Unilever and Infosys Technologies also ended on a firm note.

Nagarjuna Cons closes 3.67-bln rupee share sale

MUMBAI, Sept 1 (Reuters) - Nagarjuna Construction Co Ltd (NGCN.BO: Quote, Profile, Research) said on Tuesday it has closed the bids for a 3.67- billion rupee share sale to institutional investors, joining a host of other Indian firms that have recently raised funds via this route.

The construction firm will issue 27.7 million shares at 132.46 rupees each, Nagarjuna said in a statement to the BSE.

Last month, Lanco Infratech Ltd (LAIN.BO: Quote, Profile, Research) raised $150 million through a stripped-down share sale to institutions. (Reporting by Bharghavi Nagaraju; Editing by Sunil Nair)