A load of crap from an idle brain

With signs of green shoots showing in economies worldwide, India  Inc’s appetite for overseas acquisitions got a fresh lease of life with Reliance Industries’ estimated $10-12 billion offer for a controlling interest in bankrupt LyondellBasell Industries.

The deal by India’s largest private sector company controlled by Mukesh Ambani, if closed, will make it one of the largest petrochemical outfits in the world. It will also be the second largest overseas acquisition by an Indian company, after Tata Steel bought Corus for $13 billion in 2007.

RIL has enough money power to make the deal happen. It has $4 billion in cash and $8 billion in treasury stocks, besides a favourable 0.35:1 debt-equity ratio. It also raised $660 million through treasury stocks sale recently.

In the year to October, Indian comanies acquired overseas assets worth $586 million, a sharp fall from the $13.06 billion in the same period a year ago, according to data from Grant Thornton Deal Tracker.

HSBC believes outbound activity will bounce back. About 70 per cent of HSBC’s pipeline is outbound transactions, which has remained the same as the previous year’s.

Tarun Kataria, managing director and head of corporate, investment banking and markets at HSBC, says India is sitting on the cusp of rapidly growing cross-border M&A activity.

“Indian firms are now well capitalised, are trading at circa 20x multiples, offshore markets are trading at a discount to India and financing is more readily available to Indian corporates than to competing offshore acquirers.”

Rest of the news here

What the successor has to manage.  A 140 year old group with….

Turnover – $71 billion

Employees – 357,000

Number of companies under the group – 98

To replace – Ratan Tata

Anyone interested / capable ?

India’s Tata conglomerate is looking around the world for a successor to Ratan Tata, the 71-year old chairman of the sprawling salt-to-steel group said in an interview with the Wall Street Journal published on Wednesday.

Local and foreign candidates were being looked at to head the group, which includes Tata Motors, Tata Steel, Tata Consultancy Services and Tata Power among its 27 listed companies

“We are in the process of formalising a successor to me. We have some outside consultants and a formal search process is on. There are no constraints,” Tata, who has steered the group for nearly two decades, said in the interview.

The successor could be from within the group or outside, Tata said, adding he hoped the person would carry on the growth path that had been set. All but one of the group’s past chairmans have been Tatas, although at the moment no family candidate has been publicly identified to take over the role.

“It would certainly be easier if that candidate were an Indian national. But now that 65 percent of our revenues come from overseas, it could also be an expatriate sitting in that position with justification now,” Tata said.

The group, founded in 1868, runs India’s top vehicle maker, top software services firm, top private sector power producer and the world’s eighth-largest steel maker by output.

Full news here

I had sometime earlier read about the British denying of an steel plant to JN Tata in the early 1900s which lead to him starting a steel company in India which finally led to Tata Steel. Today, Ratan Tata, the descendant of the enterprising pioneer has bought over the mega steel company Corus and two of the most iconic British automobile brands (Jaguar and Land Rover). Though Deccan Chronicle might be trying to create a story out of nothing, its still an interesting read.

The low profile Tata chairman, Mr Ratan Tata, has more than avenged the scorn that the British had first poured over his forefather and founder of Tata Steel, Jamshedji N. Tata with the signing and sealing of the deal involving the takeover of the iconic Jaguar-Land Rover brands.

According to history J.N. Tata, a big name in textiles, got the idea of a steel plant when he was on a trip to Manchester. He had set his mind on building a steel plant that would rival the best in the world. But as he found, steel was not as easy as building textile mills.

He had wanted to raise funds for his steel venture but it was met with scepticism by the British who were in the throes of the industrial revolution. As his biographer Frank Harris said Tata found his path blocked at every turn with the curious impediments which dog the steps of pioneers who attempt to modernise the East. There was Sir Frederick Upcott, chief commissioner of the Great Indian Penninsula Railway, who promised to ‘eat every pound of steel rail Tata succeeded in making.’

But Tata persisted and succeeded. In 1900 he met the secretary of state for India, Lord George Hamilton, in England. He was a man in a hurry as he bulldozed his way. He went from there to the US where he consulted Julian Kennedy, a leading metallurgist, and later met Charles Page Pertin who he wanted to take charge of building the plant in India.

Meanwhile, he advised his office in Bombay and it was known then, to obtain prospecting licences. But he passed away in 1904 and the steel plant took its first step in February 1908 when the first stake was driven in. The first blast furnace was blown in on December 2, 1911, and the first ingot was rolled out on February 16, 1912. One does not know if Sir Frederick was around and whether the steel ingots formed part of his diet then.

Now two centuries later, his successor Ratan Tata, literally took Britain by storm when he first took over Corus and then bid successfully for Jaguar-Land Rover. There was the same scepticism about a third world country taking over Corus and JLR. In fact in the US, dealers were appalled that an Indian should be taking over JLR as they thought it would reduce their ritzy luxury qualities. But Tata Motors prevailed and these British brands are now firmly hitched in Tata stable.

Article from: Deccan Chronicle

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Eleven Indian companies among world’s 50 Local Dynamos

As many as 11 India companies, including the likes of ICICI Bank and Bharti Airtel, have made it to a list of 50 ‘Local Dynamos’ for mastering the dynamics of their domestic markets. These 50 firms from the world’s Rapidly Developing Economies (RDEs) are “domestically focused, at least for now, and have devised formidable business models with which to master the intense dynamics of their local markets,” global consultancy firm Boston Consultancy Group said in a report.

Other Indian companies in the list are two Tata Group entities Indian Hotels and Titan Industries besides Amul, Apollo Hospitals, CavinKare Group, ITC Limited, NIIT, SKS Microfinance and Subhiksha.

Full article here

Telecom outfit market to ring in $6.5 bn revenue in 2007-08

India, the world’s fastest-growing telecom market, is also making steady progress in the telecom manufacturing space. Latest figures from the Department of Telecom (DoT) indicate that revenue from the telecom manufacturing sector is set to cross the $6.5 billion (Rs 23,656 crore) figure in fiscal 2007-08. At the current growth rate, the Indian telecom equipment manufacturing sector is set to become one of the largest globally by 2010.

However, telecom hardware manufacturing in India is dominated by international majors, including Nokia, Ericsson, LG and Alcatel-Lucent while indigenous domestic manufacturers continue to contribute very little.

Full article here

132 Indian manufacturing cos join TPM Excellence League

With 23 companies receiving the Total Productive Maintenance (TPM) Excellence Award at a ceremony in Japan, the number of winners has swelled upto 132, industry body CII said.

Hindustan Unilever Nashik and Pune, Hosur and Mysore plant of TVS Motors, Hospet Steel Ltd, Brakes India Ltd are among the 23 companies which included in the TPM Excellence League. TPM is the concept originated and developed by Japan Institute of Plant Maintenance (JIPM).

Full article here

Coke upbeat about making India one of its top 5 mkts

Betting big on India’s potential to emerge among its top five markets in the world, Cola giant Coca Cola today committed to more “incremental” investment on top of Rs1,000 crore which it is pumping within the next three years.

“We are bullish on India. It is a matter of stimulation… as the growth comes, you have to put in incremental investments,” E Neville Isdell Chairman and CEO of US-based multinational Coke told PTI.

“We are investing $250 million (Rs1,000 crore) and this will certainly not be the last. of our investments,,” Isdell, who is visiting India said.

Full article here

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