NEW DELHI, Apr 25: India is mulling inviting Qatar to invest in the country’s energy sector, and may offer equity stake to the Gulf nation in NTPC’s gas-based project in Kerala, in lieu of assured fuel supply for the plant.

Power Ministry which is battling with acute gas shortage at its generating stations is exploring avenues to source the fuel from overseas in order to mitigate the shortfall from domestic sources.

This proposal was discussed at a meeting of the Committee of Secretaries headed by Principal Secretary to the Prime Minister Pulok Chatterji earlier this week, sources said.

The Power Ministry’s proposal of offering stake to Qatar government in NTPC’s gas-based Kayamkulam plant in Kerala and also the company’s proposed renewable energy project was discussed, sources added.

Even as the government asked power companies to halt their plans of setting up gas-based projects as well as expanding the current ones till 2015-16 due to scarcity of natural gas, the the Power Ministry is looking at other means for bringing the fuel to the gas-starved plants.

State-owned NTPC may revisit its proposal of offering equity stake to Qatar in its gas-based Kayamkulam project with the assurance of getting regular fuel supplies for the same, w

In 2010, Qatar Petroleum had evinced interest in picking up equity stake in NTPC’s Kayamkulam plant but the deal could not materialise after remaining at the discussion stage.

The company, which was looking at expanding the plant capacity from the current level of 350 MW to over 1,000 MW, has put the plans on hold due to non-availability of gas.

NTPC, which currently generates nearly 40,000 MW of power had plans to become a 75,000 MW company by 2017.

However, it has scaled down the target to nearly 70,000 MW due to difficulty in making available adequate natural gas.

At present, NTPC has seven gas-based stations — 413 MW Anta (Rajasthan), 652 MW Auraiya (Uttar Pradesh), 645 MW Kawas (Gujarat), 817 MW Dadri (Uttar Pradesh), 648 MW Jhanor-Gandhar (Gujarat), 430 MW Faridabad (Haryana) and 350 MW Rajiv Gandhi combined cycle power project at Kayamkulam. (PTI)

NEW DELHI, Apr 25: Standard & Poor’s today cut the rating outlook of four public sector entities, including EXIM Bank and IIFCL, to negative following the agency’s revision of country’s sovereign outlook.

Earlier in the day, S&P lowered India’s rating outlook to negative and warned of a downgrade in two years if there is no improvement in the fiscal situation and the political climate continues to worsen.

Besides Export-Import Bank of India and India Infrastructure Finance Co Ltd, S&P has also revised the rating outlook to negative from stable for Indian Railway Finance Corp (IRFC) and Power Finance Corp (PFC).

However, it has affirmed the ‘BBB-‘ long- term issuer credit ratings on these government-related entities (GREs).

The rating outlook revisions on GREs reflect the change in outlook on the Republic of India (BBB-/Negative/A-3) on account of slow fiscal progress and deteriorating economic indicators, S&P said in a statement.

“We have equalised the ratings and outlooks on India EXIM, IIFCL, and IRFC with the sovereign rating and outlook. This reflects the entities’ integral linkages with, and their critical roles to, the Government of India.

“We believe there is an “almost certain” likelihood of extraordinary government support to these GREs,” S&P noted.

Noting that it views PFC’s link to the government as very strong, the agency said, “we therefore assess an extremely high likelihood of extraordinary government support to the company”.

Such level of support, combined with PFC’s stand-alone credit profile, results in a rating that is at the same level as the rating on India.

“The rating outlook of the government owned institutions cannot be higher than the sovereign rating. So accordingly, our rating outlook has been revised,” IIFCL Chairman and Managing Director S K Goel told.

IIFCL get funding from multi-lateral institutions. So rating revision has no impact on the company, he said.

On the company’s outlook being cut to negative, PFC Finance Director R Nagarajan said the move follows S&P revising the sovereign rating outlook.

In response to a query on whether the negative outlook would make borrowing expensive for the company, Nagarajan said, “We have to wait and watch. We cannot comment immediately”. (PTI)

GURGAON, Apr 25: Concerned with its sales hitting a roadblock since the beginning of this year in India, German auto major Volkswagen today said it is taking stock of the situation as it looks to increase customer satisfaction.

“This year, we are trying to consolidate and sit and see if we are doing all the things right. We have to see if we are having qualitative sales,” Volkswagen Group Sales India member of board Neeraj Garg told reporters here.

In January this year, the company’s sales stood at 5,789 units, up 3.38 per cent from the same month last year. While in February, sales were down 7.77 per cent at 6,529 units, in March they grew by 2.85 per cent to 8,326 units.

The company, however, posted an overall growth of 51.68 per cent at 78,281 units in the fiscal 2011-12.

“We cannot grow at the same pace. Last year we grew at a very high rate. Now it is about maintaining that level,” Garg said.

Asked what are the areas of concern that the company is looking to address, he said: “Having good after-sales service … Customer expectations are increasing gradually. It is about managing customer expectations.”

Admitting that a lot more can be done to please the customers, he said: “Nobody in the industry has been able to meet 100 per cent of the customer expectations. There is definitely a gap in the industry. If somebody is happy, then somebody is unhappy.”

The company that currently has 103 dealers in 84 cities added another one here today.

On whether the company is looking to bring vehicles with alternate fuel technology, he said: “We will have to think about CNG variants. It will be a part of our discussions internally.”

He, however, did not specify a timeframe for launching such alternate fuel products saying, “It is just the beginning of a thought process. We cannot say right now whether we will go for it or we will not go.”

Garg said currently CNG models contribute only 2 per cent of the passenger car market and is available only in Delhi, Mumbai and Gujarat.

The Indian car market stood at 20.16 lakh units in 2011- 12, as per Society of Indian Automobile Manufacturers.

Volkswagen currently sales models, including Polo, Vento, Jetta and Passat in India. Its manufacturing plant at Chakan in Maharashtra has a capacity to produce 1.3 lakh units per annum. (PTI)

NEW DELHI, Apr 25: Global agency Standard and Poor’s (S&P) today lowered India’s rating outlook to negative and warned of a downgrade in two years if there is no improvement in the fiscal situation and the political climate continues to worsen.

The lowering of outlook from stable (BBB+) to negative (BBB-) is expected to make external commercial borrowings expensive for Indian Inc. It may also have implications for the capital market.

“The outlook revision reflects our view of at least a one-in-three likelihood of a downgrade if the external position continues to deteriorate, growth prospects diminish or progress on fiscal reforms remains slow in a weakened political setting” said S & P’s credit analyst Takahira Ogawa in a statement.

BBB- is the lowest investment grade rating.

Commenting on the rating action, Jagannadham Thunuguntla, strategist and head of research at SMC Global Securities, said

“Indian (new) sovereign rating is just one step away from junk bond status…Somehow I feel the dream of India growth story is coming to an end”.

The negative outlook, the rating agency further said, signals likelihood of the downgrade of India’s sovereign within the next 24 months. “A downgrade is likely if the country’s economic growth prospects is dim, its external position deteriorates, its political climate worsens, or fiscal reforms slow”, it said.

The lowering of rating outlook comes despite Finance Ministry pitching for an upgrade at the recent round of meetings between the officials and representatives of the S&P. (PTI)

SEOUL, Apr 25: South Korea’s LG Electronics Inc , the world’s No.2 TV maker, reported on Wednesday that quarterly profit more than tripled on improved TV sales and as its handset business swung to a small profit.

January-March operating profit rose to 448 billion won ($392.7 million) from a 131 billion won profit a year ago, beating a consensus forecast for 304 billion won by Thomson Reuters I/B/E/S. In the previous quarter, profit was 23 billion won.

LG’s handset business reported a second consecutive quarterly profit of 35 billion won after six straight quarters of losses, marking a sharp improvement from a 101 billion won loss a year ago.

Shares in LG, valued at over $11 billion, rose 1.65 percent after the earnings announcement, versus a 0.5 percent rise in the wider market. ($1 = 1140.8500 Korean won) (agencies)

BEIJING, Apr 25: China’s industrial output growth is showing positive signs of acceleration in the second quarter of the year versus the first quarter, the Ministry of Industry and Information Technology said on Wednesday.

‘Production activity is picking up in the second quarter from the first quarter and there are some positive signs showing that trend,’ Zhu Hongren, the ministry’s chief engineer, told a news conference.

‘The fundamentals of our industrial sector development remain good. We still have sustainable growth potential and the downward pressure is under control,’ he added.

China’s industrial output growth has been on a broadly downward trend since late 2009.

March industrial output grew 11.9 percent on the same period a year ago, its weakest rate since July 2009 during the depths of the 2008-09 global financial crisis, though recent signs have emerged that the bottom of China’s current downward economic cycle may have been reached in Q1(agencies)

SAN FRANCISCO, Apr 25: Apple Inc’s quarterly profit almost doubled, blowing past Wall Street estimates after a jump in iPhone sales, particularly in the greater China region, and soothing fears that the iPhone was past its best days for sharp growth.

Shares in Apple, the world’s most valuable technology company, shot 7 percent higher after the bell, recouping some losses from the past two weeks that had stemmed from concerns that iPhone sales growth rates could not be maintained.

While iPad sales were a little lighter than expected, fiscal second-quarter revenue jumped to $39.2 billion, 59 percent more than a year earlier and 6.5 percent higher than analysts’ average forecasts.

Lower-than-expected commodity costs also helped lift margins way above estimates.

‘That shows they are able to maintain their pricing without compromising on growth,’ said Morningstar analyst Michael Holt.

Holt added that this had come even though lower priced competition from Google Inc’s Android phones – made by the likes of Motorola Mobility and Samsung Electronics were becoming more compelling.

‘The concern was that Apple might sell more older models to be more competitive. That would have shown up in the gross margin. But aggregate gross margin and average revenue per device show that this hasn’t happened,’ he said.

Apple sold 35.1 million iPhones – which account for about half its revenue – in the quarter, outpacing the 30 million or so expected by Wall Street analysts, with pent-up demand for the 4S bolstering revenue for China, Taiwan and Hong Kong five-fold to $7.9 billion.

‘International iPhone sales were on fire,’ Apple Chief Financial Officer Peter Oppenheimer told Reuters in an interview.

But sales of the iPad, the latest version of which hit

Store shelves in mid-March, came in at 11.8 million iPads, below an average forecast of up to 13 million.

‘There’s no doubt looking in the last quarter and the Christmas season, Apple has executed very well. But you are starting to see the iPad … Reach some sort of saturation with the current product,’ said Patrick Becker, a principal at Becker Capital Management, which does not own Apple shares.

Net income rose to $11.6 billion, or $12.30 a share, from $6 billion, or $6.40 per share, a year earlier. That also outpaced Wall Street’s target of $10.04 a share, according to Thomson Reuters I/B/E/S.

Gross margins in the fiscal second quarter climbed to 47.4 percent from 41.4 percent a year earlier, surpassing Wall Street’s average forecast of 42.8 percent.

The results came after a 13 percent decline in its shares – long considered a must-have in most U.S. Equity portfolios – over the past couple of weeks in unusually volatile trading, as investors fretted over potential competitive and pricing pressures.

Responding to concerns that wireless carriers may reduce subsidies for the iPhone, thereby lowering Apple’s profit margin, Chief Executive Tim Cook said the subsidies aren’t large when compared with what carriers can recoup from consumers over a 24-month contract period.

So-called churn, or the rate that customers switch from the iPhone to other models, is the lowest of any phone they sell, which has a ‘significant, direct financial benefit to the carrier,’ Cook added.

As for patent litigation battles with rivals, Cook said he preferred to settle if Apple could get a fair settlement. The company is fighting court battles with several Android phone makers, including Samsung, HTC Corp and Motorola in the United States and other countries.

The company, which has said it will finally begin sharing its record cash hoard with investors via a quarterly dividend, added that $74 billion of its $110 billion in cash and securities was now parked outside of the United States as of March 31.

Apple’s stock gained to $601 from a close of $560.28 on Nasdaq but is still far below an intraday high of $644 reached this month.

‘When you have a strong rally in a stock it often sells off for no better reason than uncertainty. I think you’re going to see the naysayers go away,’ said Michael Yoshikami, chief executive of Destination Wealth Management.(agencies)

HONG KONG, Apr 25: Huawei Technologies Co Ltd, the world’s No.2 telecom equipment maker, expects to invest $4.5 billion in research and development this year, up from around $2.37 billion last year, Executive Vice President Eric Xu said on Wednesday.

In coming years, Huawei’s mainstay business of selling network equipment to telecom carriers will grow by 10-20 percent, while its consumer devices business will grow by around 30 percent, Xu told an analysts conference in Shenzhen, China (agencies)

MUMBAI, Apr 25: IT major Wipro today reported 7.7 per cent increase in consolidated net profit at Rs 1,480.9 crore for the fourth quarter ended March 31.

The company had posted a net profit of Rs 1,375.4 crore during the January-March quarter in 2010-11, Wipro said in a filing to the BSE.

The total income during the quarter rose by 18.84 per cent to Rs 9,836.30 from Rs 8,276.3 crore in the year-ago period.

“Corporations globally are focused on leveraging technology to drive revenues and productivity. Our strategy is aligned to deliver value to our customers by partnering with them in this journey,” Wipro Chairman Azim Premji said in a statement.

For the year ended March, 2012, Wipro posted an increase of 5.1 per cent in its net profit to Rs 5,573 crore compared to Rs 5,297.7 crore in the 2010-11 fiscal.

Total revenues of the company for 2011-12 increased by 20.66 per cent to Rs 37,404.4 crore compared to Rs 30,998 crore in the previous fiscal.

“Our focus on operations helped improve revenue productivity and deliver strong cash flows in a volatile environment,” Wipro Executive Director and Chief Financial Officer Suresh Senapaty said.

“We have delivered revenues in line with our guidance in an uncertain environment. Our restructuring journey started with us positioning the customer at the center of all our efforts,” Wipro Executive Director and Chief Executive Officer for IT Business, T K Kurien said.

Kurien added that the company has seen progress with customer satisfaction scores going up in each of the last four quarters and “we have created better value for our clients, with seven customers contributing more than USD 100 million in revenues”.

Wipro said it added 41 new customers during the quarter and 173 new customers during the year.

The company said during the ongoing quarter (Q1, FY2012-13), it expects revenues from IT services business to be in the range of USD 1,520 million to USD 1,550 million, assuming that exchange rates of the dollar will be at Rs 50.07.

The company has made certain exchange rate assumptions for other currencies as well for making this projection.

Revenues during the quarter from IT products segment increased by 3 per cent year-on-year (YoY) to Rs 937 crore (USD 184 million), Wipro said.

The IT products segment of the company recorded an increase of 4 per cent YoY basis to Rs 3,844 crore (USD 755 million) for the year ended March, 2012, it added.(PTI)

BEIJING, Apr 25: China Development Bank (CDB), Beijing’s financing arm for big infrastructure projects, posted a 22.9 percent rise in net profit in 2011 to 45.6 billion yuan ($7.23 billion), the bank said in its annual report published on Wednesday.

The policy bank has come under the spotlight as it is an active lender to Chinese companies that expand overseas or seek resources from abroad.

The bank’s net profit figure makes CDB the sixth most profitable bank in China, behind the five biggest banks deemed ‘systemically important’ by regulators, with earnings boosted by an increase in its financing margin.

CDB said its non-performing loan ratio dropped to 0.4 percent at the end of 2011 from 0.68 percent from a year ago.

CDB, which has a sovereign status in the onshore bond market, had a net interest rate gap of 204 basis points in 2011, up from 185 basis points in 2010, as it raised low-cost funds from the interbank system and lent heavily to government-backed projects such as roads and railways.

The bank said last week that it would issue 1.055 trillion yuan of bonds in China’s debt market in 2012, a slight drop from 1.065 trillion issued last year.

CDB is the second-largest bond issuer in China’s interbank market, next only to the Treasury, accounting for 20.8 percent of total bonds issued last year.

POLICY BANK

CDB, with 6.25 trillion yuan in assets, is regarded as a policy bank that subordinates profitability to serving government interests, despite a cabinet-level reform programme launched in 2008 to gradually remove the bank’s sovereign guarantee and make it a commercial bank.

Chen Yuan, CDB chairman and the son of Chinese revolutionary leader Chen Yun, said in the annual report: ‘In 2012, the world economic situation remains complicated with rising uncertainty and instability in the economy…But the long-term trend of positive growth in the Chinese economy has not changed.’

The bank is owned by three entities – the finance ministry with 50.18 percent, Central Huijin Investment Ltd at 47.63 percent, and China’s national pension fund with 2.19 percent.

The bank’s outstanding foreign exchange loans were $187.3 billion by end of 2011, including a loan of 325 million euros to China’s Suntech Power Holdings to build 150 solar energy power stations in Italy.

CDB provided 80 million euros to Jiangsu Jinsheng to buy a 50 percent stake in German machine tool maker EMAG and it pledged $400 million in loans to the Karara iron ore project in Australia, in which Angang Steel has a stake.

CDB is also playing a pioneer role in promoting the yuan abroad. The bank is expected to provide 10 billion yuan worth of loans to Russia, India, Brazil and South Africa in an important cooperation mechanism for the efforts of BRICS nations to reduce the use of the dollar in global trade.

CDB said the outstanding value of its overseas yuan loans had reached 61.5 billion yuan as the end of 2011. ($1 = 6.3073 Chinese yuan) (agencies)