Amtek Auto to raise $250 mn via FCCBs, shares.................

Huge returns may be a history for investors: HDFC Bank....................

General insurance logs 16 pc growth in FY06......................

Market generally easier

COIMBATORE, June 5: Tea prices generally ruled easier by Re one to Rs three per kg at the Coimbatore auction, held last week, industry sources said today.

With fair enquiry from CIS exporters,stylish best Nilgiri whole orthodox leaf and larger met with some demand and ruled firm to dearer by rs.One, while remaining highgrowns quoted irregular depending on quality, the sources said.

However, CTC leaf teas met with selective demand, resulting in prices ruling irregularly lower with some withdrawals. Bolder export type grades quoted easier by rs.Two to rs.Three, while medium broken lower by rs.Two to rs.Three per kg. Few bright liquoring varieties were barely steady and sometimes lower by Re one, while smaller brokens and fannings quoted around last.

In the dust category, orthodox quoted around last level, while ctc witnessed an irregular market, with popular and high priced teas ruling steady to occasionally easier by Re one.

Good orthodox brokens quoted at Rs 44 to Rs 47, while good ctc brokens at Rs 46 to Rs 52 and fannings at Rs 46 to Rs 53 and medium ctc brokens at Rs 40 to Rs 44 and fannings at Rs 43 to Rs 52 per kg.

Best ctc dust quoted at rs.50 to rs.61, good at rs.46 to rs.50, medium at rs.42 to rs.45, while medium orthodox dust quoted at rs.35 to rs.44 per kg.

Of the total offerings of about 5.96 lakh kg, dust comprised 3.45 lakh kgs, the sources said. (PTI)

Glenmark, Paul Capital sign USD 27 mn
deal for derma products

MUMBAI, June 5: Glenmark Pharmaceuticals Inc (GPI) has signed a deal with an international healthcare Investment fund, Paul Capital Partners Royalty for development of 16 dermatological products by the company for the US market.

Under the terms of the arrangement, the company said Paul Royalty will invest up to USD 27 million to finance the development of 16 dermatological products by Glenmark Pharmaceuticals for the US market.

Glenmark MD and CEO Glenn Saldanha said, ''This deal marks many firsts including first time an Indian company is entering the US market with an entire portfolio of dermatology products, a unique deal structure and the first risk-sharing financing deal of its kind.''

Sharing clinical and operational risks, Mr Saldanha said, inherent in the portfolio and reducing the impact of generic R&D expenditure on the profit and loss are among the key reasons for the company to have entered into this deal. ''We have chosen Paul Royalty to partner in this risk-sharing deal for their deep experience in healthcare investment and understanding of the process evolved.''

Further, he said the company will be responsible for pre-clinical development, will manage, the clinical trial and manufacture the products. It will be responsible for filing the abbreviated new drug applications (ANDAs) and upon approval marketing the products in the US.

It will also supply active pharmaceutical ingredient (API) for some

of the products. Paul Royalty will finance product development through milestone payments to GPI over the next two years. In return, Paul Royalty will receive a royalty -- quantum undisclosed -- on net sales for these products, with the percentage varying by product and performance.

The products in the portfolio currently have a total US market revenue of about USD one billion. DSP Merrill Lynch and Greenberg Traurig LLP were the company's financial and legal advisors, respectively, for the deal.

All 16 products are expected to be launched over the next five years

with the first product launch occurring in 2007. (UNI)

BHEL gets order for irrigation scheme in AP

NEW DELHI, June 5: State-run Bharat Heavy Electricals Ltd today said it has secured an order for setting up a lift irrigation scheme in Andhra Pradesh.

The order for the 5x30 mw Kalwakurthy Lift Irrigation Scheme has been placed by Gammon India, who secured the Turnkey contract for the project from Andra Pradesh Government, a BHEL release said.

The company’s scope of work envisages design, manufacture, supply, testing and commissioning of pumps, motors, controls and other associated auxilliaries.

The scheme would irrigate 2.75 lakh hectares of parched land in the state, BHEL said. (PTI)

Amtek Auto to raise $250 mn via FCCBs, shares

MUMBAI, June 5: Auto component manufacturer Amtek Auto Ltd has decided to raise 250 million dollars by way of Foreign Currency Convertible Bonds (FCCBs) or other securities.

The EGM, held today, accorded authority to the board to raise the amount through the issue of FCCBs, GDRs, ADRs, equity shares, warrants or other securities, the company informed the Bombay Stock Exchange.

A decision to increase the borrowing limit to Rs 3,000 crore from Rs 2,000 crore, subject to necessary approvals was also given a nod by the shareholders.

The meeting also approved increasing the company's authorised share capital to Rs 80 crore from Rs 70 crore. (PTI)

Huge returns may be a history for investors: HDFC Bank

NEW DELHI, June 5: Volatile stock market movements are likely to continue to spook the potential investors, while huge returns enjoyed just a few days ago may not be repeated, leading private banking major HDFC Bank said.

The current stock market valuations reflect the corporate earnings growth expectations more reasonably following the recent correction, the bank said in its latest monthly investment newsletter for its customemers.

The shareholder returns should remain volatile going forward, while historic returns are unlikely to be repeated, the bank said.

The market has just gone through an unprecedented correction after rising sharply through the past 18 months. The Bombay Stock Exchange's benchmark 30-share Sensex surged to a life-time high of 12,612 on May 10, while more than doubling from nearly 6,000 level in November 2004.

When the sensex peaked above 12,600 level last month, it was trading at one-year forward P/E of about 20x, making it one of the most expensive markets in the world, the bank said.

According to HDFC Bank, the sharp rally in the recent past has been primarily driven by two factors -- strong earning growth and a re-rating in P/E of Indian companies.

However, the record high level witnessed on May 10, reflected a one-year forward P/E of as high as 18.6x, sharply higher than a ratio of 8.5x on March 31, 2003.

However, the record high level witnessed on May 10, reflected a one-year forward P/E of as high as 18.6x, sharply higher than a ratio of 8.5x on March 31, 2003.

The average earnings growth of 30 Sensex companies also dropped considerably to nearly 15 per cent as on May 10 this year, from as high as 36.46 per cent on March 31.

However, the correction witnessed on the bourses between May 10-22 led to a sharp decline in the P/E ratio to 15.6x making the current valuations more reasonable.

An analysis of the past movements in the stock market shows that a 1,000-point rally has shown a faster pace than the previous thousand-point jump, except for the 8,000-9,000 movement.

The quantum of accelerating rally in the Sensex could be gauged from the fact that average return per day has also consistently increased with each 1,000-point rally in the past.

The Sensex's average return per day was an astounding 0.83 per cent during the 600-point jump between April 20 to May 10, as against a meager 0.13 per cent between November 17, 2004 and June 21, 2005, when the Sensex surged from 6,000 to 7,000 level.

Back in December 2002, the market was grossly undervalued and was de-rated consequently due to various reasons, the bank said.

The barometer index had jumped nearly 314 per cent, from its March 2003 level, when it scaled a new peak last month.

The latest 1,000-point jump from 11,000 to 12,000 level took only 22 trading sessions, while it was a matter of just six sessions to push the Sensex from 12,000 to 12,600.

In comparison, the Sensex had taken 131 trading sessions to move from 6,000 to 7,000 level in 2004-05.

However, the trend can not continue indefinitely and had to break some day, HDFC Bank said.

While a sharp volatility in equity markets is on expected lines given the nature of the asset class, the most difficult thing to predict is the timing of such a correction, the bank added. (PTI)

General insurance logs 16 pc growth in FY06

NEW DELHI, June 5: General insurance industry grew by 16 per cent in 2005-06 as private insurers continued their robust performance, while public sector players New India Assurance and Oriental Insurance improved their show.

Despite continuous fall in business of government-owned National Insurance, the 12 non-life insurers collected Rs 20,378 crore in first year premium in the last fiscal compared to Rs 17,531 crore collected in 2004-05, according to data compiled by regulator IRDA.

New India Assurance collected Rs 4,762 crore in premium and continued to lead the non-life sector by cornering 23.36 per cent of the market.

National Insurance was at the second spot by collecting Rs 3,524 crore in premium, a decline of 7 per cent, but had a market pie of 17.29 per cent.

Oriental Insurance mopped up Rs 3,518 crore in premium income after logging 16.6 per cent growth in business to corner a market share of 17.26 per cent.

Another PSU insurer United India grew business by a modest 6.8 per cent to collect Rs 3,147 crore in premium and had 15.44 per cent of the market.

The eight private players expanded their business by 52 per cent to collect Rs 5,427 crore in premium income and increased their combined market share to 26.6 per cent from 20.2 per cent a year ago.

ICICI Lombard led the private players by logging 80 per cent growth in premium at Rs 1,592 crore, followed by Bajaj Allianz, which grew by 50 per cent to collect Rs 1,287 crore in premium.

ICICI Lombard had a market share of 7.81 per cent and Bajaj Allianz had 6.31 per cent of the market.

Iffco Tokio grew by 78 per cent to mop up Rs 896 crore and a market share of 4.39 per cent while Tata-AIG premium collection was up 30 per cent at Rs 612 crore and had 3 per cent of the market.

Royal Sundaram collected Rs 453 crore in premium, followed by Cholamandalam (220 crore), HDFC Chubb (Rs 202 crore) and Reliance General (162 crore).

Export Credit Guarantee Corporation (ECGC), which is exclusively into credit insurance, grew business by 12 per cent at Rs 578 crore in 2005-06. (PTI)