Shriram Transport to open 50 automalls

Shriram Automall, a subsidiary of Shriram Transport Finance Company, is planning to open 50 automalls by 2013 with an investment of around Rs 100 crore, a top company official has said.

"Automall is a unique platform for the second-hand trucks market. Automall will benefit truckers in promptly replacing their vehicles. We plan to roll out 50 such centres over the next three years," Shriram Transport Finance Deputy Managing Director UG Revankar said.

On revenue expectation from this business, he said the company is looking at netting around Rs 30 crore this fiscal.

Each Automall will come up on a 3-4 acre plot with an investment of around Rs 1.5 crore and will function on a lease basis, he added.

The company has launched its fourth Automall at Panvel near here over the weekend. It already has three such centres in Delhi, Baroda and in Chennai.

"Shriram Transport aims to bring in more transparency while buying and selling used commercial vehicles and the Automall is one such facility," he said.

The company plans to open two more Automalls in Hyderabad and Jaipur by the end of this fiscal and is eyeing Rs 30 crore revenue by FY12.

The Automall will also house OneStop, a virtual truck bazaar that will provide real-time information about used trucks available for sale and simultaneously facilitates registration of individual buyer's requirements.

"Customers will be free from brokers and RTI documentation by the OneStop service. The company plans to install one such facility all its 500 dealerships," Revankar said.

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10 Things Still Made in America

"Today, U.S. manufacturers provide about 75% of the products that Americans consume," the study says. "But that number could soar to 95% within a few years if business and government leaders take the right actions. Conversely, if the sector remains neglected, that output could fall by half, meeting less than 40% of U.S. demand."

The report was based on a sector-by-sector analysis of U.S. industrial competitiveness, along with a survey of 200 manufacturing executives and experts.

Among the recommendations:

The U.S. needs to build a better future with Mexico, shifting less-demanding, labor-intensive processes to that country while helping build a safer consumer economy there and retaining highly skilled work in the U.S.
America needs more robust manufacturing-education programs, immigration reform and to promote the attractiveness of manufacturing careers.
Public and private sectors can build geographical concentrations of suppliers, service providers and academic institutions, reinforced by investments in infrastructure.
The country needs also to simplify and streamline the tax and regulatory structure. The official statutory corporate tax rate stands at 39%. Closing the gap between statutory and effective rates (typically 28%) would be a revenue-neutral way to put U.S. manufacturing on a level global playing field.
While government officials debate these and other proposals, consumers can take matters into their own hands by buying American-made goods.

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Banks Killing Jobs?: Poll

Bank of America(BAC_) has grabbed headlines lately for a host of reasons, but one of the most attention-grabbing announcements the bank has made of late was a decision to eliminate 30,000 jobs over the next few years.

The bank's struggles and those of the country at large seemed to come together very neatly in that bit of news, and it was not surprising to me to hear it mentioned by at least one of about four Wall Street protesters I spoke to recently outside our offices. None of them seemed to know much about the banking industry, but they were surely aware of the lack of jobs out there and that number got their attention.

Many more layoffs are coming in the banking industry, according to Richard Bove, analyst with Rochdale Securities.

In a report published Thursday, he argued revenues will be curtailed due to "a major change in the secular outlook for the industry," adding that, "the next big news coming out of Wall Street will be layoffs and bonus cuts." Bove cited "conversations with a number of New York based brokerage firms," as his source.

Bove does not see banks as job destroyers, however. Instead, he blames politicians and regulators in New York State.

"The politicians who run the state have been advocating suing the industry and forcing cutbacks in incomes and now they will get their wish. It is likely that when the industry does recover it will not be in New York State but rather in other states and countries that have policies more oriented to assisting the industry's future growth," Bove writes, adding that "the impact is likely to be beyond the brokerage industry. Incomes and wealth will decline. This is likely to impact housing prices and the sale of a wide range of products. It is expected to hit the state's tax base."

Sherry Jarrell, professor of finance and economics at Wake Forest University Schools of Business, argues the cuts are necessary so that struggling banks like Bank of America can avoid the fate of Kodak(EK_), which is fighting to stave off a bankruptcy filing.

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IDBI Bank plans to raise $200m from Swiss market

Public sector lender IDBI Bank is planning to raise around USD 200 million from the Switzerland market under its medium-term foreign debt raising programme.

"We have a close eye on the Swiss market. Recently, the Korean Exim Bank had raised money from there. As the opportunity comes, we will look at it," Executive Director Melwyn Rego said.
He, however, declined to give any specific time-frame for raising this amount.
Medium-term-note (MTN) is a debt instrument through which a corporate house or bank raises capital at cheaper rates from overseas market. Usually, there is a fixed coupon or interest rate that is paid by the issuer to the subscriber of the issue on maturity.
Earlier, IDBI Bank has hired investment managers like BNP Paribas, Credit Suisse Group and UBS for raising capital through Swiss franc-denominated bond sale.
IDBI Bank, which has a USD 1.5 billion MTN programme, has already raised around USD 400 million in the first part of this calendar year.
Domestic banks are increasingly looking at Switzerland to raise capital as part of their market diversification drive. In 2011 so far, while Union Bank of India sold 160 million Swiss franc (CHF) (around USD 185 million) worth of 4.5-year-bonds in January, State Bank of India had raised CHF 325 million (around USD 370 million) in the same route. Also, the Exim Bank raised CHF 175 million (around USD 200 million) from the Swiss market in the recent past.
IDBI Bank posted a 20 percent rise in its net profit to Rs 516 crore in the second quarter of current fiscal compared to Rs 429.10 crore a year ago, while total income grew 24.10 percent at Rs 6291.42 crore.

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NTIPL closes its Chennai unit

NETZSCH Technologies India Pvt Ltd (NTIPL) has shifted its pump manufacturing facility from Chennai to Goa's Verna Industrial estate, a senior official said today.

The company has closed the Chennai plant, which had the capacity to manufacture 300 pumps per annum and has shifted in a new facility at Goa, with a capacity to produce 1,500 units per year, NTIPL Managing Director Vivek Norman told reporters.
NTIPL is the subsidiary of the Germany-based NETZSCH Group of Companies, which has a global turnover of euros 400 million. It is into progressing cavity pumps, industrial rotary lobe pumps, macerators and griders.
Norman said that the India turnover is euro 2.5 million and it will grow by more than 30 per cent for this fiscal due to the Goa facility.
"The key factor for success is that we should be close to the local market," he said adding that 800 units per year is the Indian sale of the company, which could be achieved with the new plant.
Norman said the company in India enjoys a market share of 25 per cent with a compounded annual growth rate of 32 per cent. The company has its sales and service offices across eight towns in India.

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NHB scraps home loan pre-payment

In a Diwali bonanza for thousands of borrowers, housing finance regulator National Housing Bank (NHB) has directed all housing finance companies to desist from imposing a pre-payment penalty on home loan borrowers.

The levy of a charge on borrowers for pre-closure of housing loans by housing finance companies (HFCs) has been considered further by the NHB in the light of subsequent developments and it has been decided that hereafter, housing finance companies should not charge a pre-payment levy or a penalty on pre-closure of housing loans, the regulator said in a notification.
In addition, the regulator has also directed all HFCs to have uniform and not differential rates of interest for old and new borrowers that have the same credit or risk profile.
The notification by the NHB comes amid a separate examination of the issue by the Reserve Bank, which is also considering a ban on the levy of pre-payment charges on loans by banks.
It is to be noted that a consensus was reached at the Banking Ombudsmen Conference organised by the RBI recently that banks should not impose pre-payment charges on loans with a floating rate of interest.
At present, there are about 54 housing finance companies operating in the country, including HDFC, LIC Housing Finance, Dewan Housing PNB Housing Finance and Sahara Housing.
The charges imposed by HFCs and banks on pre-payment of housing loans by borrowers is as high as 4 per cent in some cases.
According to the notification, HFCs cannot levy a charge for pre-closure of floating rate home loans even if the funds are borrowed. However, for fixed rate housing loans, the pre-payment charge will be waived only if the loan is pre-closed by borrowers out of their 'own sources'.
'Own sources' are sources other than borrowings from a bank or financial institution.
“This will allow the borrowers greater freedom to exercise their choice in borrowing from entities and different rates offered in the market. The pre-payment charges were restraining customers from moving around,” NHB Chairman and Managing Director R V Verma said.
“This will enhance the credibility of the housing finance system as well as the confidence of all stakeholders,” he said.
All HFCs are advised to ensure compliance with the notification with immediate effect, he added.In a separate notification, the regulator said it has been observed that some of the housing finance companies are offering different floating rates of interest to their old and new customers. Several complaints have been received by the NHB against such practices.
“We have told HFCs to apply a uniform standard and benchmark old customers who are already on floating rates and new customers entering the market today also on floating rates with the same risk profile,” Verma said.
“Charging of higher interest from old customers against new customers puts them to a great disadvantage, besides being discriminatory. The practice also generally lacks in transparency and fairness,” he said.
“For the growth of the healthy and sound housing finance system, it is considered necessary that pricing of the products by the lending institutions are transparent,non-discriminatory and objective,” he added.

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TCS recruits 20,349 staff, 'highest-ever', in Jul-Sep period

Country's largest software exporter Tata Consultancy Services (TCS) today said it has added 20,349 people during the July-September 2011 quarter, its highest number of hiring for any three-month period.

The number of net additions, however, stood at 12,580 during the reported period.
"The recruitment this quarter, 20,349 that is the highest gross that TCS has ever done, so there has been very strong hiring and we continue with our overall plan of hiring 60,000 people this year," TCS Executive Vice-President and Global Head (Human Resources) Ajoy Mukherjee said.
The total employee strength of TCS was 2,14,770 on a consolidated basis at the end of September 30, 2011.
Trainees started joining the company from the beginning of the July-September quarter, resulting in the addition of 10,192 trainees and 8,125 laterals in India, along with 2,032 employees overseas.
The utilisation rate (excluding trainees) was flat at 83.1 per cent. The same including trainees was 76.4 per cent.
Attrition decreased to 13.7 per cent from 14.8 per cent in the previous quarter.
Attrition in the IT Services business was 12.51 per cent, while BPO attrition was at 24.25 per cent.
"We are on course to meet our hiring target for the current financial year. Our employee engagement efforts are helping to curtail attrition and increase retention of talent in the company," Mukherjee said.
The company, at the beginning of the fiscal, had said it will hire 60,000 people during the fiscal.

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