Cairn India profit trebles on higher output, prices

Cairn India posted a record profit in the second quarter after boosting output and prices to meet rising demand. Net profit rose to Rs 1,585.08 crore in Q2 FY11 against Rs 469.51 crore in the corresponding period last fiscal. The company's income from operations stood at Rs 2,686.42 crore in the quarter under review against Rs 229.78 crore in the year-ago period.

Cairn India MD & CEO Rahul Dhir said, “The first full quarter of sales through the pipeline to refineries has generated significant revenues from the Mangala field in Rajasthan. Cairn India’s development and operational efficiency has allowed it to quickly ramp up production to the currently approved plateau of 1,25,000 bopd with the potential to produce oil at an even higher rate from the Mangala field.”Cairn India shares were down 1.07% to close at Rs 318.60 on the BSE.

In the September quarter, the gross production of the operating units was 1,65,385 barrels of oil equivalent per day against 60,480 boepd in the same period last fiscal. Working interest production was 94,304 boepd compared to 18,638 boepd in Q2 FY10. The average oil price realisation in Q2 FY11 was $69.5 per bbl compared to $69.1 per bbl in Q2 FY10. The gas price realisation in Q2 FY11 was $4.5 per thousand standard cubic feet (mscf) compared to $3.9 per mscf in Q2 FY 2009-10. Average price realisation per boe was $67.8 in Q2 FY 2010-11 compared to $59.6 in Q2 FY 2009-10.

In Rajasthan, the company completed one year of successful production from the Mangala field and sold more than 16 million barrels (mmbbls) to domestic refiners to date. It saw rapid and safe Mangala field production ramp-up to its currently approved plateau rate of 1,25,000 bopd (barrels of oil per day).

Meanwhile, Cairn India raised Rs 2,250 crore in July-September period by issuing unsecured non-convertible debentures to repay existing (rupee) loans and for other general purposes, it said Thursday. “The proceeds of this financing will be used to fund repayment of the existing (rupee) loan and other general corporate expenses,” the company said in a statement.

“This access to the Indian debt capital market is a first for Cairn India, which received subscription from a wide range of investors consisting of mutual funds and insurance companies,” the statement said.

IIM-Kozhikode, IIT-Kanpur to partner with Yale

The Indian Institute of Technology-Kanpur and the Indian Institute of Management- Kozhikhode on Thursday entered into a partnership with the Yale University for academic leadership development programmes. Under the programme, vice- chancellors and deans will be introduced to best practices of institutional management in the United States.

The partnership is part of the knowledge initiative launched by Prime Minister Manmohan Singh and U.S. President Barack Obama during Mr. Singh's visit to the U.S. in November 2009.

It aimed at advancing the cause of higher education in the country and “addressing the problem of leadership vacuum” in the sector, Human Resource Development Minister Kapil Sibal said after president of Yale University Richard Levin, Director of IIM-Kozhikode Debashis Chatterjee and Director of IIT-Kanpur Sanjay Dhande signed a memorandum of understanding.

The partnership will take effect from January next, with provision for two new centres of excellence in academic leadership at IIM-Kozhikode and IIT-Kanpur. The partnership will begin with a term of five years.

Mr. Sibal said that a six member committee, with equal participation from the three partnering institutes, would determine the norms and qualifications for participation in the leadership programmes. The first programme would take place in 2011 in New Haven, Connecticut.

Dr. Levin, longest serving president of the Yale University with his tenure spanning 19 years, said the programme, in the initial phase, would be launched on a modest scale and would train 30 to 40 vice-chancellors on their campus.

Yale was also closely working with China on a similar partnership programme.

Dr. Levin praised the government's efforts in introducing the Foreign Universities Bill. He, however, noted that Yale had no plans to set up a campus in India. He supported efforts for bringing in reforms in the higher education sector.

Dr. Levin felt allowing foreign institutes to operate in India would ultimately benefit students.

Mr. Sibal expressed his confidence that the country would certainly attract top class universities, if not global brands such as Yale and Harvard.

Indigo to connect to new destinations

Low fare airline IndiGo, riding high on a bottom of the pyramid approach, is planning to expand its operations in Kolkata. The fastest growing airline is planning to connect to new destinations such as Agartala, Thiruvanthapuram, Kochi, Jaipur and Ahmedabad. The company is also planning to start its international operations from Kolkata in the next 300 days to locations like Singapore, Bangkok, Dhaka, Malaysia.

“Kolkata is a very important market for us. Our load factor out of Kolkata is 87 per cent, where as out national average is 81 per cent. So we want to give more focus on this market and expand our operations. In fact, eastern region itself is a very important market for us. We have flights operating in north eastern states, Bihar, Agartala etc. So we have decided to increase flight frequencies from Kolkata to already existing destinations like Ahmedabad, Chennai etc and add new destinations like Jaipur, Kochi etc,” said Aditya Ghosh, president, IndiGo.

The company is also planning to launch flights from Coimbatore to Chennai and Delhi.

Also on the anvil are plans to start international operations — south east Asian countries — from Kolkata. “We will very soon get the in-principle approval to fly international. The idea is to attract the huge tourist population, which fly to these places every year,” Ghosh said.

At present, the company is operating 207 flights every day across 22 destinations. IndiGo, with a market share of 16.4 per cent as per company figures, also looks to expand its fleet size “We will have 34 aircrafts in our fleet by the end of this calendar year. By next calendar year we are planning to have a fleet of 48 aircrafts” said Ghosh.

IndiGo has managed to grow its net profit more than five times to Rs 550 crore in 2009-10. The unlisted airline cited lower costs and higher revenues but did not furnish further details. “There is a substantial growth in revenues. We also added more aircraft and as a result of this our available seat kilometres measures (ASKMs) have gone up by 28 per cent,” Ghosh said. IndiGo’s revenue increased 35 per cent to Rs 2,664.5 crore for the year.

GSK Pharma Q3 net rises 12%

Drug major GlaxoSmithKline Pharmaceuticals Ltd expects to launch Revolade, a drug for low platelet counts and Votrient, for metastatic renal cell carcinoma, in the first quarter of the forthcoming year.

The drugs have received approvals from the regulatory Drug Controller General of India, GSK Pharma's Senior Executive Director, Mr Mehernosh Kapadia, told Business Line, after the company's board meeting on Thursday.

The company's growth in the third quarter ended September 2010 has been in line with expectations, he said, with patented drugs, vaccines and mass products contributing to the robust growth. Vaccines grew 34 per cent in the quarter under review, he said, adding that global supply issues had “substantially” been addressed. Vaccines account for about 10 per cent of sales. And drugs under price control accounted for 25 per cent of sales. Between the company's new product launches and in-licensed products, growth in the months ahead is also expected to be along projected lines of 15 per cent, he said.

On the controversy regarding the $750-million payment by the parent company to settle civil and criminal charges following the manufacture and distribution of low quality drugs from its Puerto Rico plant – Mr Kapadia clarified that there was no connection to the India operations.

GlaxoSmithKline Pharma shares were marginally up on the BSE, at Rs 2,261 on Thursday.

Marketwatch:Nifty ends lower ahead of F&O expiry; Bharti, HUL down

Indian markets ended a choppy session on a weak note Tuesday, ahead of October F&O series expiry. Metals, banks and PSU stocks were under pressure while auto and FMCG ended modestly higher.

According to analysts, rollovers to the next series have been lower as FIIs await crucial economic and political events in the US. 

“Ratio of FII to market-wide OI has been around 77-79% on higher side while 64-66% on lower side. At this point of time low FII/Marketwide ratio of 66% suggests caution since Nifty gains have been insignificant in current month even though being near the recent highs.

On the Nifty options side, the highest open interest on calls is 6200 while 6000 on the puts suggest a range of 6000-6200. 

Open Interest for at-the-money Nifty November calls are surprisingly low at the moment considering the fact that maximum theta or time value can be extracted by shorting both calls and puts a few days before the start of fresh series,” said Arun Mewawalla, AVP, Technical & Derivatives, Quantum Securities. 

Trend for November series is likely to be dictated by important US economic data like US GDP on Oct 29, US manufacturing data on Nov 1, US House of representative elections and US Fed meet which may give direction on Quantitative Easing. 

“Investors should wait and watch until the above given factors unfolds,” Mewawalla added. 

National Stock Exchange’s Nifty ended at 6082, down 23.80 points or 0.39 per cent. The broader index touched a high of 6120.25 and low of 6074.65 in today’s trade. 

Bombay Stock Exchange’s Sensex closed at 20,221.39, down 81.73 points or 0.40 per cent. The index touched intraday low of 20189.30 and high of 20344.68 

BSE Midcap Index was down 0.42 per cent while BSE Smallcap Index inched 0.22 per cent higher. 

Amongst the sectoral indices, BSE Metal Index fell 1.21 per cent, BSE Bankex declined 0.84 per cent and BSE PSU Index slipped 0.77 per cent. BSE Auto Index moved up 0.86 per cent and BSE FMCG Index advanced 0.50 per cent. 

Bharti Airtel (-2.57%), HUL (-2.43%), Cairn India (-2.37%), Tata Steel (-2.31%) and BPCL (-2.29%) were the top Nifty losers. 

Maruti (3.98%), Reliance Capital (3.53%), ITC (1.63%), Jaiprakash Associates (1.47%) and DLF (1.37%) were amongst the gainers. 

Market breadth was negative on the NSE with 1703 losers against 1586 gainers. 

European markets were in the red while Wall Street is likely to open flat. At 4:50 pm IST, Dow Jones futures was down 0.03 per cent, S&P 500 declined 0.03 per cent and Nasdaq was up 0.04 per cent.

Tata Docomo 3G services to be priced reasonably

Tata DoCoMo, the GSM brand of Tata Teleservices (TTL), which is all set to launch its 3G services this Diwali, is focusing on reasonable pricing, quality of network and bringing in NTT DoCoMo's 3G leadership to India to make head-start.

The company expects a full blow 3G in India in the next three years and is investing heavily in customer educations about 3G and customer acquisition.

Four things bound to change with 3G are content, connectivity, cloud and its contextual part, feels Deepak Gulati, executive president, mobility, TTL. “Pricing will be simple and based on our promise of 'pay per use' model. 3G will not be a price game but a quality and content game,” he added.

Japanese telecom major NTT DoCoMo, a world leader in 3G technology, is working in tandem with Tata Teleservices for launching 3G in India. “NTT has been assisting us right from the start in our 3G preparations. They bring in a world of knowledge in this field and this knowledge transfer has been very useful to us. They will also be at the frontier in innovating applications and content for us,” said Gulati.

Tata Docomo to launch 3G services on Diwali

Here's a festive gift from the Tata stable. Tata Docomo, the GSM arm of Tata Teleservices, is set to become to first private telecom operator to launch 3G services in the country this Diwali. 

The 3G network will be rolled out across nine telecom circles where Tata Docomo has a licence, in partnership with Japan's NTT Docomo, the global leader in the 3G space. "We will bring products and services that will redefine the Indian telecom experience. Tata Docomo's commercial launch of 3G operations will ride on the back of game-changing products, applications and services," said a company official. 

While 3G as the next-generation of mobility does bring with it better voice clarity, fewer call-drops and faster Internet speeds; the impact it is likely to have on consumers lives is much greater than any of these improvements alone. It will enable richer commun-ication with friends and family, make the device a gateway to a world of information and entertainment purely for personal consumption, and assi- st the user with a host of location-based services, he added. 

NTT Docomo is committed to bring various 3G products and services that give Indian customers a flavour of tomorrow
.

Airtel to launch 3G by end of 2010

Bharti Airtel today said it would launch high-speed third generation (3G) mobile data services in two months.

The telecom operator, which earlier this year won 3G spectrum in 13 circles for Rs 12,295 crore, said it was in the process of rolling out the networks. Bharti is in talks with other operators to ensure seamless roaming in 3G. The 13 circles constitute 68 per cent of Bharti’s revenue market share, the company said.

“3G services will mark the beginning of the next phase of India’s telecom growth story and elevate the telecom sector on a par with most advanced markets in the world,” Sanjay Kapoor, CEO (India and South Asia) of Bharti Airtel, said.

Tata Teleservices, which was the first to announce its 3G launch date, will roll out the services on November 5 in nine service areas. Vodafone Essar will launch 3G in nine circles in January-March and plans to spend up to $500 million within two years.

Besides meeting the growing demand for high-speed surfing and wireless entertainment, Airtel will introduce a suite of products in mobile commerce and health segments. Analysts said the 3G launch was likely to boost Bharti’s revenue amid falling call tariffs for basic services.

Bharti will be deploying high speed HSPA networks of Ericsson, Nokia Siemens Network and Huawei.

3G Auction would help Indian Economy : Pranab Mukherjee

Speaking at the annual Economic Editors Conference in Delhi on Oct 26, Finance Minister, Pranab Mukherjee stated that auction of 3G and broadband spectrum and disinvestment proceed would help Indian economy to meet its expected growth.

For thb current fiscal in 2010, Mukherjee nailed the economic growth at 8.25-8.75 per cent.

Though the finance minister assured the economic growth, but he also informed that food prices would continue to drive inflation for some time.

Stating about the gross tax revenue growth and proceeds from the spectrum sale, Mukherjee also hoped that economic growth of India would surpass 9 percent in near future.

ING Life launches new ULIP

ING Life Insurance today launched a new Unit Linked Insurance Product-ING Prospering Life which meets wealth accumulation and protection needs of the customers, a top official today said. 

The new ULIP comes with a host of customer benefits, including 5 fund options to choose from, Automatic Asset allocation and unlimited switches with partial withdrawls free of chrage, T K Uthappa, Director- Sales ING Life Insurance told reporters here. 

The product offers an annualised premium ranging between rs 48,000 and rs 96,000 and is competitively priced against other long term investment options, he said. The sum assured is an amount 10 times the annual premium at inception for those below the age of 45 and 7 times the annual premium at inception for those above the age of 45. 

The minimum top up premium is rs 5000. During April-September last year, the company sold 1.37 lakh policies while it was only 1.12 lakh policies during the same period this year. Admitting an industry 'degrwoth', he hoped that by march 2011 they would succeed in improving on this by at least 50 per cent. 

Kerala accounts for only 5 per cent of its business of 60 per cent from South India. The company was looking at at 20-25 per cent growth in business from south India and 15 per cent from Kerala thsi fiscal, he said.


(ET)

Sensex sheds 82 points on Profit Booking

Stock market benchmark Sensex on Tuesday shed 82 points on profit booking, mainly in banking and metal stocks, amid weak global sentiment. 

The Bombay Stock Exchange's 30-share barometer, that rose 137 points in the last session, ended at 20,221.39, down 81.73 points, or 0.40 per cent. 

The wide-based 50-share Nifty Index of the National Stock Exchange finished 0.39 per cent lower at 6,082. 

Marketmen said profit booking at existing higher level and the concerns of a possible rate hike by the RBI in the first week of next month weighed on investor sentiment. Session was also choppy as F&O settlement is due this week. 

"Market continues to be in a sideways consolidation after last month's stellar rally. The indices were unable to sustain the early gains as investor sentiment remained muted amid lack of incremental triggers," IIFL Vice President (Research) Amar Ambani said. 

Metal and banking stocks were the worst hit, while a rise in consumer durables, automobile and FMCG space cushioned some of the losses. 

Tata Steel dropped 2.6 per cent and was the biggest loser in the Sensex pack. Sterlite Industries, which posted a 5 per cent rise in Q2 profit, declined 0.09 per cent. Hindalco fell 1.56 per cent and Jindal Steel 1.34 per cent. 

There were also some concerns in the market participants after the Finance Minister Pranab Mukherjee ruled out putting controls on FII inflows into the equity market as of now, but said that RBI may intervene to check the rupee appreciation if needed. 

This year, the FII inflows have already reached USD 24.48 billion. Of this, FIIs pumped in USD 6.11 billion, about 25 per cent of the total inflow so far, in the month of October alone. 

Financial was another sector that witnessed heavy selling pressure, with SBI dropping 1.84 per cent, ICICI Bank 0.93 per cent, HDFC Bank 0.56 per cent and HDFC 1.3 per cent. 

"Investors are worried ahead of RBI policy meeting, where the central bank may announce a hike in key policy rates," Unicon Financial CEO Gajendra Nagpal said. 

Index heavyweight Reliance Industries Ltd, however, came in as help and capped some of the losses. The scrip settled 0.56 per cent higher at Rs 1,096.50. 

Auto stocks too helped at some extent. With a jump of 3.5 per cent, Maruti was the top gainers in the BSE-30 pack. Tata Motors rose 0.61 per cent and M&M 0.30 per cent. 

Analysts said, heavy demand during the festive season may help the automakers to record good sales this month. 

In the 30-Sensex pack, 17 stocks ended with loss, while 13 scrips closes in the green. 

Some other major losers of the day included Bharti Airtel that fell 2.42 per cent, and its rival RCom by 1.73 per cent. HUL fell 2.21 per cent, ONGC by 1.62 per cent and BHEL, 1.4 per cent. 

Global cues were not supportive either. Key indices across the world were under pressure. In Asia, the China's benchmark index Shanghai lost 0.32 per cent and Japan's Nikkei 0.25 per cent. Europe market, too, were down during the afternoon session

RBI sees food price risks, adds to rate view

The Reserve Bank of India (RBI) warned on Tuesday of persistent inflationary pressures on the economy from rising food prices, adding to expectations that the RBI will raise interest rates in November.

Bond yields, which have been moving to factor in India's sixth rate rise this year, ticked higher on the comments from Deputy Governor Subir Gokarn, who said structural changes in the emerging economy could have an adverse impact on inflation and inflation expectations.

"Persistent price increases in commodities for which there are less effective substitutes, with other things remaining equal, will raise the potential rate of inflation over a period of time," Gokarn said in a speech.

"This means that actual inflation or interest rates will be higher than they would be in the absence of such increases," said Gokarn, whose brief at the RBI includes monetary policy.

Still, the finance ministry urged the RBI not to choke off the country's growth. It said in a report on Tuesday that GDP could rise 8.5% to 9.7% in the fiscal year to the end of March 2011.

"It has to be ensured that monetary tightening does not adversely affect the pace of recovery at this stage," the Finance Ministry wrote in the report.

The RBI is widely expected to raise interest rates by 25 basis points on Nov. 2 as it battles wholesale inflation that has been persistently above its perceived comfort zone of 5 percent to 6 percent. The RBI has forecast inflation will ease to 6 percent by March.

The wholesale price index, India's main inflation measure, rose by 8.62% in September over a year earlier.

After the central banker's comments the yield on the benchmark 10-year bond rose 5 basis points to 8.18%.

The 10-year yield has been rising since the start of this month and touched a 25-month high last Thursday as dealers priced in the risk of a rate rise.

Concerns that India is struggling to bring inflation under control has led to a reversal in the flattening of the interest rate swap curve over the past two weeks.

Traders now expect the spread between 5-year swap rates and 1-year swap rates to widen to 55-60 basis points, led by a rise in the long end, from 48 basis points on Tuesday as the market prices in the potential for policy rates to rise 50-75 basis points by the end of March.

Two weeks ago, traders were pricing in a greater chance of a pause in rate hikes after December. However, after the September inflation release, they now expect the rate tightening to continue through March.

Food inflation

Annual food price inflation was 15.53% in early October and has remained stubbornly high, in part a reflection of rising incomes in the fast emerging economy.

"When we take into consideration the impact of structural food price shocks such as the ones India is experiencing, the policy implications become complex," Gokarn said.

He cited the example of pulses, a main source of protein in the Indian diet. The price of some pulses has roughly doubled in the past three years as production has failed to keep pace with a rise in demand.

"Rise in income has increased the share of proteins in peoples' diet. Rising affluence has also led to an increase in demand for proteins and nutrition," Gokarn said.

Gokarn said the conventional view suggested monetary tools would have no impact in combating a rise in food prices due to temporary supply disruption. Indeed, it could hurt economic growth prospects.

"However, if the economy is at or close to capacity utilisation, even temporary price shocks can aggravate inflation expectations, which may justify monetary response even though shock is temporary and will die out before the actions take effect," he said.

The RBI has raised interest rates five times this year, taking the repo rate to 6% and the reverse repo rate to 5%, to control inflation, which was in double-digits for six months through July.

Tata Coffee Q2 net up 12.8 pc to Rs 10 cr; sales decline

Tata Coffee today said its consolidated net profit for the quarter ended on September 30 2010, rose by 12.8 per cent to Rs 10.1 crore as against the corresponding quarter last fiscal. 

The company had reported a net profit of Rs 8.9 crore for the second quarter of the last fiscal, Tata Coffee said in a filing to Bombay Stock Exchange. 

During the July-September quarter of this fiscal, the company's total income declined by 5.6 per cent to Rs 299.56 crore as against Rs 317.36 crore for the year-ago period. 

The company said that instant coffee operations, which were adversely affected by the global recession in the previous year, have made significant improvement recording higher volume of production and sales compared to the previous period. 

Meanwhile, in a separate filing to the stock exchange, Tata Coffee said its board, at its meeting held yesterday, has appointed Deepak Kumar as additional director and executive director 'Finance' for three years with immediate effect.

Jindal Steel and Power Ltd's Q2 net up 57 percent

Steel major Jindal Steel and Power Ltd on Tuesday reported an increase of 57 percent in its net profit for the quarter ended Sep 30, which stood at Rs.478.17 crore as against Rs.305.01 crore in the like period of 2009. 

The company's net sales also increased by 43 percent to reach Rs.2,295.47 crore as compared to Rs.1,608.54 crore in the previous year's corresponding period. 

The consolidated result of the company jumped by 11 percent and stood at Rs.894.24 crore in the second quarter as against Rs.808.36 crore in the second quarter of 2009. 

According to the company, its consolidated net sales were also up by 25 percent at Rs.3,077.95 crore, from Rs.2,455.58 crore for the quarter ended Sep 30, 2009. 

The company also said that growth has been seen in production of sponge iron, steel products and electrical power generation.


(ET)

SKS Microfinance net profit rises in Q2

India's largest private small scale lender, SKS Microfinance Saturday reported a rise of 116 percent at Rs.80.54 for the quarter ended Sep 30 compared to Rs.37.35 crore in the previous corresponding period.

The total income went up by 77 percent at Rs.366.56 crore in the quarter under review compared to Rs.207.49 crore in the year-ago period, the company said in a regulatory filing.

The core business of SKS, which is the only private microfinance company to get listed, is to provide collateral-free loans to poor women in rural areas.

The company recently fired its chief executive Suresh Gurumani because of "interpersonal issues" with the senior management. The incident took place less than two months after SKS made a stupendous stock market debut, listing at a market capitalisation exceeding Rs.8,000 crore.

A high court bench of Justice G. Bhavani Prasad, however, passed an interim order asking the company to retain Gurumani on its board of directors till further orders and restrained newly appointed chief executive and managing director M.R. Rao from taking any major policy decisions.

Vodafone International gets a bitter bill

The Income Tax Department has raised a tax demand of Rs11,217.95 crore on Vodafone International Holdings BV for failure to deduct tax before making a payment of $11,076 million to Hutchinson Telecommunications International when it bought the latter's mobile telephony operations in India. The tax is to be paid within 30 days of the receipt of the notice for tax demand. The company meanwhile is contesting the IT department's claim. "As per the Supreme Court directive, the Income Tax department needed to come out with the total tax demand by October 25. However, even though the Mumbai High Court indicated that some parts of the deal were not taxable, the tax authorities have not apportioned the tax amount correspondingly," said a spokesperson for Vodafone International Holdings who did not wish to be named. He however refused to say whether the company would pay the apportioned amount.

He added that the company will wait until Monday for better clarity on the issue, even though it believes that it does not owe any tax to the Indian authorities on the transaction. In its official statement released to the media, the company said it disagreed with the tax calculation released by the Indian Tax Office and it is not liable for any tax on this transaction involving the transfer of a company outside of India. "Further, Vodafone was the acquirer and not the vendor and has made no gain on the transaction. In this “test case”, the tax authority is attempting to interpret Indian law as it has never been interpreted for the past 50 years, and this interpretation also goes against internationally recognized tax norms. Vodafone will continue to take whatever actions are necessary to defend itself in this matter," the statement said.

The tax demand has been raised after the Supreme Court on September 27 asked the Income Tax Assessing Officer to determine and quantify the tax liability of Vodafone within four weeks. The case will be heard by the apex court on October 25.

Raymond, union agree to Rs 309-cr compensation

Textiles major Raymond’s plan to develop a realty project on its 126-acre Thane unit received a shot in the arm on Friday as the company reached an out-of-court settlement with its labour union after a nearly one-year long stalemate over the terms of a voluntary retirement package. The two sides agreed upon a compensation package worth 309 crore, double of the company’s initial offer of Rs 150 crore. 

The compensation will be paid to all 1,885 workers of the unit in two tranches spread over three years. The first tranche of Rs 150 crore and dues worth Rs 49 crore will be paid in the next one week while the balance Rs 110 crore will be paid after three years. The compensation package represents workers’ full wages and other benefits payable until their age of retirement. 

ET in its edition on October 15 had reported that the company has revised its compensation package offer to around Rs 300 crore that will be paid in two tranches and was close to reaching an agreement with the union. 

The union had initially sought a compensation package of Rs 350 crore but lowered its demand to Rs 328 crore. 

“It is not downsizing, its relocating (of operations ). This particular plant had become completely uneconomical... You will not see any other plant of ours offering a VRS scheme,” said Gautam Hari Singhania, chairman and managing director. He said the outlook for textiles business continues to be bright. 

Mr Singhania refused to comment on the company’s plan for the land where the textile factory was set up in 1925 and operations suspended in November 2009. 

Reacting to the news of the settlement, shares of Raymond closed at 408.30 on Friday on the National Stock Exchange , up nearly 8% from Thursday’s closing price. The Sensex, the most widely followed index, fell 0.5% on Friday. 

Mr Singhania said as per the agreement, all four writ petitions filed by the labour union against the company’s plan to develop a realty project will be withdrawn immediately. However, local MLA Pratap Sarnaik, who has also filed a petition jointly with union leader Jintedra Joshi, said he will not withdraw his petition until workers’ entire dues are paid. 

After nearly 11 months of negotiations with the management, the labour union had filed a writ petition in the Bombay High Court in September seeking a ban on the proposed realty project claiming that the closure of the Thane unit was “illegal and unconstitutional”. 

The court had directed the Thane municipal corporation not to grant any approvals to the company for redevelopment of the land. The Maharashtra government had also refused to provide a no objection certificate for the realty project until the company resolved the compensation dispute with its workers.

Citibank launches PremierMiles credit card

One problem frequent flyers often face is limited choice, while spends on airline tickets earn them loyalty points, they do not have the freedom to redeem them against their choice of airline tickets. 

To cater to this segment of flyers, Citibank has come up with PremierMiles credit card that helps them accumulate reward points, in the form of ‘PremierMiles’, and redeem the same against flight tickets of close to 50 domestic and international carriers. In that sense, the loyalty scheme is airline-neutral. 

Deutsche Bank and American Express also offer similar programmes linked to their specialised credit cards. Such programmes help those who opt for low-cost carriers, which mostly do not offer such schemes, to earn frequent flyer points. 

Under the programme, card members earn 10 premier miles for every 100 spent on airline ticket bookings made at airline-owned websites, airline booking counters or through the PremierMiles portal. For each non-airline spend worth 100, the card holder can earn 2.5 miles. 

Upon activation, the card account is credited with 5,000 premier miles. If you incur expenses of 4 lakh using this card in a year, you will be entitled to a bonus of 2,500 premier miles. The points so earned cannot be clubbed with the frequent flyer points you may have earned. 

The card membership also entitles the holder access to VIP lounges at airports across the world and offers on accommodation at hotels in the network. The card comes with a built-in overseas medical insurance and fraud protection plan. 

Those wishing to obtain the card will have to shell out an annual fee of 5,000, which could be seen by some, particularly those looking for a diverse rewards programme, as trifle expensive for a primarily airline focused card. To redeem the points collected, card holders will have to visit the bank’s designated portal. They can also make their flight ticket bookings through the site. 

Why go for it: 

The rewards programme is not restricted to any particular airline. Miles accumulated can be redeemed for tickets of several international and domestic airlines, including low-cost carriers. 

Why not: 

While the choice is not limited in terms of airlines, the travel-focus of the card means that points earned can be redeemed only against airline tickets and hotel accommodation – something that may not appeal to those keen on variety.