Sharekhan puts 'buy' on Balaji Telefilms; target Rs 268

MUMBAI: Sharekhan has maintained ‘buy’ on Balaji Telefilms for a target price of Rs 268. The company has denied any plans to launch a Hindi general entertainment channel, dismissing the media reports on the company's GEC plans as pure speculation.

Sharekhan opines that the launch of a Hindi general entertainment channel in the current cluttered and highly competitive scenario will have severe financial implications for the company and also affect its core business of television content. Hence, the brokerage is inclined to believe that the reports of the launch of a general entertainment channel by the company are mere speculation.

The company has launched a new show, ‘Kootukari’, on Surya TV. Earlier ‘Kalyani’, another of its show on Surya TV, had gone off air in mid July 2008. Balaji Television will be offered additional slots on various channels of Sun Network, which will help it, increase the number of programmes under the sponsored segment.

Sharekhan’s interaction with the company's management suggests that the maximum number of programmes that could be launched in the sponsored category can go up to eight against the current four shows. However, despite an increase in the sponsored programming hours, the contribution of the sponsored content business to the company's top line and bottom line shall remain relatively small.

The brokerage has understood that no further development has taken place on the proposed stake sale by STAR. The promoters of Balaji Televisions had been given 240 days (ending April 2009) to buy out STAR's 25.99 per cent stake in the company at Rs 190 per share. Considering the quantum of the amount involved (Rs322 crore), Sharekhan expects the promoters to rope in financial/strategic partners which might lead to an open offer. The open offer would be a trigger for the stock.

Sharekhan’s outlook on the television content business of Balaji Television remains positive, as the company is a scaleable player in a non-scaleable business. However, the near-term profitability of Balaji television would be affected by a drop in the realisations due to the end of the company's exclusivity arrangement with STAR and the going off air of one of its popular shows, ‘Kahani Ghar Ghar Kii’.

At the market price of Rs 148.7, the stock trades at 7.5x FY2010E earnings per share (EPS) of Rs 19.9.
thanks to: economictimes.indiatimes.com

Should Apple lose sleep over Google phone?

In the 15 months since it introduced the first iPhone, Apple has radically changed our expectations for mobile phones. But the rest of the industry isn't standing still. We're likely to see a fresh round of innovation as T-Mobile rolls out the first handset based on Google's Android operating system. And Research In Motion is fiercely defending its mobile e-mail turf with very good new products. Of the two, outsider Google faces the tougher challenge. But based on a preliminary look at the T-Mobile G1, announced on Sept. 23, launching in the U.S. and Europe in late October, I'd say it has a shot.

Apple set this whole competition in motion by building a single, excellent phone within an ecosystem that it controls totally, including the right to approve all third-party software. In contrast, Google is pushing an open platform, meaning any handset manufacturer can design hardware that runs Android. The closest relative to Android is Windows Mobile, which remains awkward to use after a decade of tweaking by Microsoft.

I spent only about an hour with the G1 ($180 with two-year contract; unlimited data plans start at $25), which is co-branded by Google and handset maker HTC. Disappointingly, the phone is a bit thick and heavy. The screen slides up to reveal a keyboard, but the way the keys are recessed between raised areas on either side makes for slightly uncomfortable typing. And while the big touchscreen is nice, you can't resize objects simply by pinching or stretching them with your fingers. Once you get used to this trick on the iPhone, you expect it on every handset.


The Android software is far more interesting than the G1 hardware, in part because the developers tried to tear down the walls that divide applications. Other mobile-phone operating systems get you only some of the way to this goal. On a Windows Mobile handset or an iPhone, if you click on a Web address in an e-mail message, the phone opens a Web page in a browser. Click on a phone number in a Web page, and the phone usually dials it. But a task as simple as copying text from a Web page and pasting it into an e-mail is difficult to impossible on handsets.

Android tries to fix this by organizing activities in terms of users' needs and desires rather than predetermined programs. In a sense you are always in a browser, even when it doesn't look like it. Not surprisingly for a product designed by Google, search is central: If you start typing while browsing the Web or looking at a picture, Android will search the phone contents and the Web based on the text. This instant search could prove to be either extremely helpful or really annoying. I will explore it in a more detailed review of the G1 closer to its launch. One problem with the initial Android release is its Google-centricity. The search, of course, is Google search, and e-mail is optimized for Google's Gmail. The phone pulls contacts from Google Contacts, so you'll need to jump through hoops to keep the phone's contact list in sync with Outlook or the Mac Address Book.
thanks to: economictimes.indiatimes.com

Tata Motors to sell stake in 6 arms

MUMBAI: Tata Motors is learnt to have initiated talks with private equity (PE) funds to sell up to 25% stake each in its six profit-making unlisted subsidiaries. The biggest of the lot is the wholly-owned arm Tata Daewoo Commercial Vehicle Company. Others include HV Excels, HV Transmissions, Tata Motors Finance, Tata Technologies and Telco Construction Equipment (Telcon).

A banker close to the development said the move is part of the company’s plan to raise Rs 3,000 crore through divestment of stakes in its subsidiaries and selling shares in listed firms. Tata Motors is also raising Rs 4,200 crore through a simultaneous, but unlinked rights issue to finance the $2.3-billion acquisition of Jaguar Land Rover (JLR) in June.

“The company feels that it need not hold large holdings in these subsidiaries. Thus, the company will bring them down by 20-25 % in each of them. However, it would like to hold a majority stake in these firms, which are mainly supplying components to it or financing its products,” the banker added. Another banker said Tata Motors would conclude the stake sale by June 2009.

The company had raised $3-billion bridge loans in June this year. Of this, $2.3 billion has been utilised for the JLR buyout and the rest was spent to meet JLR’s working capital expenditure. Tata Motors will pay back the bridge loans in June 2009.

It is learnt that JLR would return $700 million to Tata Motors and mark the loans on its balance sheet.
When contacted, a Tata Motors spokesperson told ET: “Tata Motors has already announced, on August 20, 2008, its intention to review the current investment portfolio and pursue a programme of monetising certain investments over the coming quarters.

We will be announcing these divestment decisions as and when they are taken up by the company. It would not be possible for us to comment on specific companies or initiatives at this stage.” Tata Motors has started selling shares in Tata Steel as part of its fund-raising programme. On Thursday, it sold one crore shares worth Rs 485 crore to Tata Sons.
thanks to: economictimes.indiatimes.com

Gold recovers on firm global cues

NEW DELHI: Gold prices recovered by Rs 170 to Rs 13,130 per 10 gram in the bullion market here today increased demand triggered by a firming trend in global markets.

Traders said buying activity gathered momentum in the precious metals on reports of a firming trend in global markets, which normally sets prices here.

Gold, which fell by over Rs 220 per 10 gram, bounced back as the metal in New York rose on fresh buying by stockists at existing levels.

The metal in New York rose heading for the second straight weekly gain as talks on the 700 billion dollar bailout by the US government to ease the credit crunch stalled.

Standard gold and ornaments, which had lost Rs 220 each in previous day's trading, staged a strong comeback and shot up by Rs 170 each to Rs 13,130 and Rs 12,980 per 10 gram, while the sovereign gained Rs 50 at Rs 10,500 per piece of eight gram.

A similar firming trend was extended in the white metal as silver ready rose by Rs 250 to Rs 20,850 per kg and weekly- based delivery by Rs 295 to Rs 21,095 per kg. Its coins also traded higher by Rs 100 to Rs 28,300 for buying and Rs 28,400 for selling of 100 pieces.
thanks to: economictimes.indiatimes.com

Nath takes a dig at troubled US banks

NEW DELHI: Taking a pot shot at the US financial sector, which is facing one of the worst turmoils ever, Commerce and Industry Minister Kamal Nath today said those "preaching" others have not kept their own house in order.

"Those who preached us best practices have not helped their own financial sector," Nath told reporters here when asked to comment on the US financial crisis, worsened by collapse of investment bank Lehman Brothers.

Nath said the amount of exposure of the banks going down is small in Asia. "A very small fraction of that (US economic turmoil) is in Asia. This shows that best practices have been adhered to in Asia," Nath said.

However, he said, the economic turmoil in the US is causing concern to most of the global economies. "It still has to be assessed to what extent it will affect the economy in Europe," he said.

The US credit crisis worsened yesterday with 158-year-old Lehman Brothers filing for bankruptcy protection after losing around 60 billion dollars in the sinking real-estate market. Earlier, the troubled investment bank Merrill Lynch was bought by Bank of America.

Citigroup Global Markets puts 'buy' on OnMobile Global

OnMobile Global

cmp: Rs 495
target price: Rs 630

Citigroup Global Markets has initiated coverage on OnMobile Global with a ‘buy’ rating saying OnMobile Global is India’s largest VAS (value-added services) operator (35% share) in a rapidly growing market [FY08-11 (estimated) CAGR at 51%.

The estimated 36% EPS (earnings per share) CAGR over FY08-11 (estimated), was due to the company’s increasing international presence, said Citi.

“Though it appears high in the current environment, we believe our target PE (price to earning)of 25x Mar10E is justified by OnMobile’s strong growth prospects and is in line with the multiple for comparable peers,” the note added.

According to the Citi note, the domestic VAS has graduated from being a glorified sub-set of p-to-p SMS to a well-demarcated segment. “The current contribution of the company at 3.4% of wire-less revenues is likely to increase to 6% by FY12E,” the note said.

“OnMobile’s industry-leading position in voice platform and CRBTs, organisation structure geared to innovate/scale up quickly, and strong operator relationships make the company well-positioned to capitalise on this opportunity,” it added.
thanks to: economictimes.indiatimes.com

Stocks to watch on Tuesday

MUMBAI: Reliance Industries’ special economic zone in Raigad, Maharashtra, may take off if the company announces a better compensation for farmers willing to part with their land, media reports quoted ministers in the state government as saying.

According to the rehabilitation package announced by RIL in 2006, the displaced farmers will be given Rs 25,00,000 per hectare. RIL also promised a job to one person in each family in the industries that came up in the zone. This may give a boost to the RIL stock, which ended down 2.45 per cent at Rs 1,884.10 on BSE Monday.

The promoters of Emami, Agarwals, have nearly doubled the open offer to acquire 20 per cent stake in ayurvedic pharma firm, Zandu Pharmaceutical Works. The offer was raised to Rs 15,000 a share from Rs 7,315 earlier.

The attempts of Agarwals to enter the board of Zandu have been stalled by the Parekhs, who have raised their stake by nearly 2 per cent in the past couple of months through open market purchases. Emami currently holds 27.5 per cent stake in Zandu while the Parekhs hold over 40 per cent in the company.

On Monday, Zandu shares fell by 5 per cent to close at Rs 16,728 on the BSE, while Emami fell by 2.9 per cent to Rs 279.60. Zandu shares had touched a high of Rs 24,643 on BSE on July 24.

Allcargo Global Logistics has firmed up plans to set up two greenfield ports on both coasts of the country. The company’s shares, which ended 4.18 per cent lower at Rs 848.95 on Monday, could see some upside.

Shares of Usher Agro are likely to witness some action on reports that private equity firms such as Blackstone, TPG, Blue River Capital are eyeing more than a 40 per cent stake in the agri-processing firm. The company’s shares rose 2.99 per cent to Rs 199.75 on Monday.

Jet Airways is in talks with Bangalore-based infrastructure developer GMR Group to buy at least 24 per cent stake in a proposed aircraft maintenance, repair and overhaul venture, to be set up at Hyderabad. Jet Airways shares ended 1.06 per cent lower at Rs 511.30 on BSE.

ICICI Bank has Rs 375-cr exposure in Lehman Brothers

NEW DELHI: Country's largest private sector lender, ICICI Bank today said its London subsidiary has 57 million Euro (about Rs 375 crore) exposure in the Lehman Brothers which has filed for bankruptcy protection.

"ICICI Bank UK Plc holds 57 million euro of senior bonds of Lehman Brothers Inc potential losses are not material," the bank said in a statement. The bank said it had undertaken transactions with the US-based troubled investment banker as part of treasury operations.

"The exposure to Lehman Brothers' entities on account of these transactions and potential loss thereon are not material," it said. ICICI Bank shares plunged by 5.82 per cent to Rs 591.35 on the Bombay Stock Exchange.

Lehman Brothers, which is a 158-years-old-financial institution has filed for bankruptcy protection, after losing around USD 60 billion (About Rs 2,76,000 crore) in sinking real-estate market.

Another investment bank Merrill Lynch is being bought over by Bank of America for USD 50 billion, while world's largest insurer American International Group (AIG) is also facing financial crisis. Meanwhile, Lehman has suspended operations of its three Asian arms.

Lehman Brothers Asia Ltd, Lehman Brothers Securities Asia Ltd and Lehman Brothers Futures Asia Ltd have suspended its operations with immediate effect, including ceasing to trade on the Hong Kong Securities Exchange and Hong Kong Futures Exchange, until further notice.

Alembic shares up 9% on NSE block deal

MUMBAI: Shares of Alembic soared nearly 9 per cent after 2.05 million shares, or 1.4 per cent of equity changed hands in a block deal on the NSE, at Rs 42 each. The identity of the buyer or seller was not immediately available. At 1 pm, the company's shares were up 8.82 per cent at Rs 45.65 after touching a high of Rs 45.85 in trade so far.