B-Gyan

Weekly Newsletter

06 October 2010 – 12 October 2010

Power & Energy | Finance | FMCG | IT & Telecom | Manufacturing

 POWER & ENERGY

RIL in hot oil over low output from KG field

The Directorate General of Hydrocarbons (DGH), the oil ministry's exploration and production
monitoring agency, has asked Reliance Industries Ltd to explain lower than expected oil production
from the Krishna-Godavari D6 offshore field, which RIL operates. Reports say crude oil production

< http://www.domain-b.com/companies/companies_r/Reliance_Industries/20101005_kg_field.html
>

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R-Infra admits buying costly power for suburbs, blames Tatas

Even as the Maharashtra Electricity Regulatory Commission (MERC) has sought expression of
interest for a new power distributor for Mumbai's suburbs from next year, current supplier Reliance
Infrastrure, which is under fire for hiking its electricity rates, today said its tariff was higher than
other distributors as it has to buy power from the market at relatively expensive rates.

< http://www.domain-b.com/industry/power/20101006_r_Infra.html >

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ONGC among firms bidding in Iraq's Oct. 20 gas auction

ONGC is among the 13 companies that qualified to take part in the October 20 auction for three gas
fields in Iraq. The fields together have estimated reserves of 11.23 trillion cubic feet of gas. Other
companies bidding include South Korea’s KOGAS, Japan’s Mitsubishi, Italy’s Edison and ENI and
Kuwait Energy.

Earlier in the week, ONGC’s bids for acquiring two Russian oil-fields in the Arctic through its Russian
subsidiary, Nord Imperial, were disqualified on grounds that it “lacked financial capability”, claims
which Indian executives maintained were “flimsy”.

ONGCs plan to hike its stake in the $1.3-billion Nam Con Son offshore gas project in Vietnam come
to nought as British oil giant BP said that it may sell its 35% stake to its affiliate TNK-BP, a 50-50 joint
venture between BP and a group of Russian billionaires

< http://in.reuters.com/article/idINIndia-52111520101011 >

< http://www.domain-b.com/companies/companies_o/ONGC/20101005_vietnam_gas.html >

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B-Gyan Newsletter 06.10.2010-12.10.2010 1

Centre to add 100,000 MW capacity over next two Plans
The Centre aims to add 100,000 MW capacity each in the 12th Plan (2012-17) and 13th Plan (2017-
22). About 65,000 MW is slated to go online in the 12th Plan, of which sub-critical and supercritical
technology in thermal plants would have equal weightages. The Centre would ensure only
supercritical technology comes up in the 13th Plan as it is more efficient and has lower carbon
footprint.

< http://www.thehindubusinessline.com/2010/10/09/stories/2010100953190400.htm >

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Petroleum Ministry chalks out road map for shale gas exploration
The Petroleum Ministry is aiming to facilitate fast track exploration of shale gas reserves by
scheduling auctions of shale gas blocks possibly by August 2011. Shale gas is the next buzz word in
the Indian hydrocarbon industry and companies like Reliance Industries Ltd. which have been
acquiring shale gas reserves overseas, could bid for blocks within India once the blocks are floated.
An accord on shale gas technology is expected to be signed with the US, when US President Barack
Obama visits India next month. This could bring better technology and reduce costs.

< http://www.thehindubusinessline.com/2010/10/11/stories/2010101151230300.htm >

Shale gas is an unconventional source of energy found in non-porous rock. It has become an
important source of natural gas in the US and interest in it has spread around the world. In India,
shale gas deposits are identified to be present in the Cambay Basin in Gujarat, the Assam-Arakan
basin in northeast India, an5d the Gondwana Basin in central India.

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IDBI ties up with WRI for consultancy services on energy

IDBI Bank under a tie-up with US-based environment research organisation World Resources
Institute (WRI) will provide consultancy services to its borrowers on energy cost reduction. IDBI Bank
would fund the implementation costs of the energy-saving initiatives while WRI would guarantee the
savings.

< http://www.domain-b.com/finance/banks/IDBI_Bank/20101006_consultancy_services.html >

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B-Gyan Newsletter 06.10.2010-12.10.2010 2

 FINANCE

15-minute pre-market call auctions start on Oct 18

NSE and BSE have decided to implement ‘pre-market call auctions’ which is a special 15-minute
trading window starting at 9 a.m from Oct 18. But all other segments including derivatives and non-
index stocks will trade only at 9:15 a.m. The call auction is the solution to take care of the
uncertainty that is there in people’s mind about where a stock should be priced at the open.

< http://economictimes.indiatimes.com/markets/stocks/market-news/15-minute-pre-market-call-
auctions-to-start-on-October-18/articleshow/6709813.cms >

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SKS Microfinance CEO Sacked

SKS Microfinance, the first microfinance company to get listed in India, sacked its CEO Suresh
Gurumani and named Mr. M.R Rao as his successor. This move saw a dip in the market price of the
shares of the company. SKS Microfinance on Friday told capital market regulator Securities and
Exchange Board of India (SEBI) that its chief executive, Suresh Gurumani, was sacked due to a
corporate tussle and differences within the board.

< http://economictimes.indiatimes.com/news/news-by-company/corporate-announcement/CEO-
sacked-due-to-tussle-SKS-Microfinance/articleshow/6716632.cms >

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Cos want 26% stake in banks they sponsor

Corporates have told RBI that they should be allowed to hold at least 26% equity in any bank they
sponsor. This would ensure balance between the need to ensure long term commitment by keeping
control over key decisions with the need to reduce operating control. RBI in its discussion paper
suggested a 40% shareholding with the lock in for the first five years.

Corporates also suggested RBI that they should be allowed to use company logo in the sponsor bank
which has also been rejected by RBI on the grounds that it should not have spill-over effect on its
operations; if at all the corporate is in trouble.

< http://economictimes.indiatimes.com/news/news-by-
industry/banking/finance/banking/Companies-want-26-stake-in-banks-they-
sponsor/articleshow/6716316.cms >

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B-Gyan Newsletter 06.10.2010-12.10.2010 3

Rupee approaches two-year high as foreign funds buy Indian Stocks,
Bonds
The rupee advanced 0.4 percent today to 44.27 per dollar as of 10:21 a.m. in Mumbai, according to
data compiled by Bloomberg. It’s Asia’s best performer of the past month with a 4.9 percent gain
and touched 44.11 on Oct.7, the strongest level since September 2008. This is attributed to
speculation that overseas investors will pump more funds in to the nation’s assets as the economic
outlook improves.

< http://www.bloomberg.com/news/2010-10-11/rupee-climbs-toward-two-year-high-as-foreigners-
buy-india-stocks-bonds.html >

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Yuan ends at post-revaluation high but off peak

The yuan, which recently powered higher after sharp criticism from the United States, pulled back
slightly after it hit a post-revaluation high of 6.6610 per dollar. It ended at its highest closing level
against the dollar since a landmark revaluation in July 2005, as political pressure on China for a
firmer currency was overtaken by renewed weakness in the U.S. dollar

< http://economictimes.indiatimes.com/markets/forex/Yuan-ends-at-post-revaluation-high-but-off-
peak/articleshow/6729370.cms >

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B-Gyan Newsletter 06.10.2010-12.10.2010 4

 FMCG

Dabur completes acquisition of Turkey's Hobi Kozmetik Group

FMCG player Dabur said it has completed the ` 324 crore acquisition of Turkey-based personal care
products maker Hobi Kozmetik Group. The acquisition will further enable consolidating and
expanding Dabur's already substantial presence in the Middle East and North African region. At
present, 20 per cent of Dabur's overall sales come from the international markets. Last fiscal,
Dabur's total sales stood around `3500 crore.

<http://economictimes.indiatimes.com/news/news-by-industry/cons-products/fmcg/Dabur-
completes-acquisition-of-Turkeys-Hobi-Kozmetik-Group/articleshow/6736553.cms >

____________________________________________________________________

Weston forays into mobile handset market

Consumer electronics firm Weston on Wednesday announced its entry into the Indian mobile phone
market with plans to garner sales of `250 crore in the next one year from its new business. The
company plans to set up a new facility for making mobile phones at Dehradun. It is expected to be
operational by next year. The company has launched seven models between a price range of `1600
to `3500.

<http://economictimes.indiatimes.com/news/news-by-industry/cons-
products/electronics/Weston-forays-into-mobile-handset-market/articleshow/6606773.cms
>

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Nirma's surprise delisting plan stokes sell-off buzz

The surprise announcement by the `4,600-crore Nirma to delist itself is being viewed as a decision
taken by a fiercely-private person to keep his company away from the public glare. There are rumors
suggesting that a major restructuring or even a sell-off may be in the offing after the company’s
board announced delisting of the soaps-to-chemicals company from BSE and NSE. Started by
Karsanbhai Patel, who would sell home-made detergents on a bicycle in the 1970s, Nirma took on
the might of FMCG giants like Hindustan Unilever and Proctor &amp; Gamble (P&G) in the eighties,
with low-priced (one-third) products.

< http://economictimes.indiatimes.com/news/news-by-industry/cons-products/fmcg/Nirmas-
surprise-delisting-plan-stokes-sell-off-buzz/articleshow/6726492.cms >

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B-Gyan Newsletter 06.10.2010-12.10.2010 5

Detergent prices may rise on duty fears
The `12,000-crore detergent industries, teeming with as many as 1,000 brands, is in a bit of a
quandary. The prices of detergents could go up by 10-12 % if an anti-dumping duty is imposed, as
companies operate on very thin margins. Director General Safeguards had imposed a 16% safeguard
duty on soda ash imports from China from April 20, 2010 to April 19, 2011 and 14% safeguard duty
on imports from China from April 20, 2011 to April 19, 2012. The presence of such duties on
ingredients of detergents is an anomaly. It will be cheaper to import mass market detergents into
India than make them in the country. This presents a great threat to the large, medium and small-
scale detergent manufacturers in the country.

< http://economictimes.indiatimes.com/news/news-by-industry/cons-products/fmcg/Detergent-
prices-may-rise-on-duty-fears/articleshow/6705184.cms >

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Shree Renuka receives orders for supply of 118m litres ethanol

The excess supply could make the ethanol-blending programme a success this year, as there has
always been a shortfall in availability of ethanol since its launch in 2006.

With cane production estimated to be higher this year, resulting in availability outstripping demand
for sugar production, sugar-makers may find this an opportune year to produce ethanol. The
country's largest sugar refiner, Shree Renuka Sugars, today said it has received orders for the supply
of 118 million litres of ethanol to oil marketing companies in five states for a period of one year.

< http://economictimes.indiatimes.com/news/news-by-industry/cons-products/fmcg/Shree-
Renuka-receives-orders-for-supply-of-118m-litres-ethanol/articleshow/6699609.cms >

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B-Gyan Newsletter 06.10.2010-12.10.2010 6

 IT & TELECOM

US Prez and team rely on Indian software for data visualization

The global market is slowly and steadily being covered by Indians as rising number of Indian start-
ups like FusionCharts, Zoho, salaree.com, tringme, deskaway, kayako are in demand for data
visualization. Moreover, US President Barack Obama along with his team rely heavily on made-in-
India software like Fusion Charts to maintain the protectionist agenda.
India is IT hub and the global acceptance has opened a whole new world for techies. Nasscom
estimates that there are over 650 such start-ups in India involved in product development.
Additionally, it has been reported that the young tech product development in India shall reach a
whooping amount of $12 billion by 2015.

< http://itvoir.com/portal/news/News/US-Prez-and-team-rely-on-Indian-software-for-data-
visualization-8-385.asp >

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Cognizant signs multi-million dollar deal with global firm 3M

IT services provider Cognizant Technology today said it has signed a multi-million dollar deal with
global firm 3M, which manufactures brands such as Scotch Brite. The deal includes a range of
application development and related services to drive operational efficiencies and improve
productivity of 3M, Cognizant said in a statement.

< http://economictimes.indiatimes.com/infotech/ites/Cognizant-signs-multi-million-dollar-deal-
with-global-firm-3M/articleshow/6731688.cms >

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Demand for premium smartphones going strong

Demand for high-end smartphones will continue to be strong as customers upgrade their mobile
phones and first-time users increasingly reach for premium handsets, an executive of Taiwan's HTC
Corp said. HTC, like Samsung and LG, is among those who are set to make new handsets with
Microsoft's Windows Phone Software, which will be introduced later on Monday. HTC, the world's
No. 4 smartphone brand, is pushing into the increasingly important mobile services sector and
recently introduced two new handsets using Google's Android software.

< http://economictimes.indiatimes.com/infotech/hardware/HTC-says-demand-for-premium-
smartphones-going-strong/articleshow/6730340.cms >

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B-Gyan Newsletter 06.10.2010-12.10.2010 7

Asia Pacific regions anticipate bigger IT budgets in the coming years
The coming year would see a drastic rise in IT budgets; courtesy software upgrades and
implementations. The majority of companies in Asia-Pacific region are foreseeing around 10% of rise
in IT budgets. Around 44% of the firms are expecting a rise in IT budgets. The survey firm cited that
Asia-Pacific regions were not hit hard by recession and are now returning to growth. Asia Pacific
regions are keeping cloud on less priority; at this point their focus is high on Desktop Virtualization
and other related technologies.

< http://itvoir.com/portal/news/Corporate-News/Netbooks-market-can-surge-by-20--4-607.asp >

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Cisco Eyes Skype Acquisition

Cisco reportedly is considering buying Skype before the VOIP and video conferencing vendor enters
into its planned IPO later this year. It would continue Cisco’s push into video. Skype officials are in
planning stages for their expected IPO, which they announced Aug. 9. But reports are circulating that
Cisco Systems may derail those plans by buying the VOIP vendor.

< http://www.eweek.com/c/a/VOIP-and-Telephony/Cisco-Eyes-Skype-Acquisition-Reports-557000/
>

B-Gyan Newsletter 06.10.2010-12.10.2010 8

 MANUFACTURING

Material Breakthrough Wins Nobel Prize

Two scientists have been awarded the Nobel Prize for Physics for their groundbreaking work on a
material with amazing properties. Andre Geim and Konstantin Novoselov, both at Manchester
University, won the coveted prize for research on graphene. Graphene is a flat sheet of carbon just
one atom thick; it is almost completely transparent and also extremely strong and a good conductor
of electricity. According to the Nobel Prize Foundation, the material could lead to the manufacture
of new and innovative electronics, including faster computers.

< http://www.manufacturingdigital.com/news/nobel-prize-physics/material-breakthrough-wins-
nobel-prize >

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Daimler India is open to contract manufacturing for others at Chennai

Daimler India Commercial Vehicles is evaluating possibilities of tying up with other global group
companies for contract manufacturing at its upcoming facility near Chennai. Daimler India
Commercial Vehicles (DICV) is investing ` 4,400 crore for a new facility at Oragadam in Tamil Nadu.
DICV has plans to introduce a range of trucks in 6-49 tonnes category under a completely new brand
for its proposed entry into India's commercial vehicle market in 2012. Globally, Daimler's truck
brands include Mercedes-Benz, Freightliner, Fuso, Western Star, and Detroit Diesel.

< http://economictimes.indiatimes.com/news/news-by-industry/auto/automobiles/Open-to-
contract-manufacturing-for-others-at-Chennai-Daimler-/articleshow/6699582.cms >

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Ford looks to drive in EcoBoost tech

US car maker Ford is planning to introduce EcoBoost technology for its upcoming eight new vehicles
for the Indian market in the next five years. The company has launched this technology for its cars in
the US. Ford’s EcoBoost engine technology was introduced a year ago in the US and has met with
great response. These engines sport 20% better fuel efficiency and 15% lesser emissions.

< http://economictimes.indiatimes.com/news/news-by-industry/auto/automobiles/Ford-looks-to-drive-
in-EcoBoost-tech/articleshow/6703408.cms >

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B-Gyan Newsletter 06.10.2010-12.10.2010 9

Auto sales momentum to rev up further on festive demand
The Indian auto industry has sharply increased its sales forecast for this fiscal after reporting more
than 30% rise in car sales for the third straight month as new launches and easy finance helped keep
strong demand intact in September. With more people expected to buy cars and two-wheelers in
the festive season, the Society of Indian Automobile Manufacturers (SIAM) on Friday increased its
growth forecast for 2010-11 to 18-20% from 13%.

< http://economictimes.indiatimes.com/news/news-by-industry/auto/automobiles/Auto-sales-
momentum-to-rev-up-further-on-festive-demand/articleshow/6716204.cms >

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Google Unleashes Robot Cars

Engineers at Google have been testing a self driven robotic car in California. The cars use video
cameras mounted on the roof, radar sensors and a laser range finder to navigate roads and detect
traffic. The cars are also reported to be using Google Maps to navigate the streets of California.
While this project is very much in the experimental stage, it provides a glimpse of what
transportation might look like in the future thanks to advanced computer science.

< http://www.manufacturingdigital.com/news/google-street-view/google-unleashes-robot-cars >

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B-Gyan Newsletter 06.10.2010-12.10.2010 10