Sectoral SnippetsIndia Industry Information
Issue 38 - December 2009
KPMG IN INDIA
Page 2 of 19
Sectoral Snippets
About Sectoral Snippets
Sectoral Snippets is an India-focused, monthly, freely-distributable newsletter brought out by
KPMG in India. This newsletter provides an overview of the Indian economy in the form of
news-briefs from across key sectors.
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Table of Contents
1. Indian Economy 3
2. Auto and Auto Components 4
3. Banking and Financial Services 5
4. Consumer Markets and Retail 6
5. Hospitality 7
6. IT / ITeS 8
7. Media 9
8. Oil and Gas 10
9. Pharma 11
10. Power 12
11. Real Estate and SEZs 13
12. Telecom 14
13. Transport and Logistics 15
Sectoral Snippets, Issue 38
As�2009�draws�to�a�close,�all�eyes�are�now�onthe�sustainability�of�the�stimulus-supportedgrowth�of�the�Indian�economy�in�the�year�ahead.The�past�year�witnessed�some�relatively�robustperformances�in�industry�and�service�sectors,increased�government�expenditure,�modest�farmgrowth,�and�strong�investments.�However,�risinginflation,�hiked�interest�rates�and�the�strength�ofthe�rupee�against�the�US�dollar�are�all�triggerswhich�could�play�a�key�role�in�determiningwhether�the�government�places�inflationcontainment�or�economic�growth�on�top�of�itsagenda,�going�forward.��
In�other�developments,�Indian�PM�ManmohanSingh�recently�wrapped�up�a�visit�to�Russiaduring�which�the�two�countries�signed�sixdocuments,�two�of�which�pertain�to�civil�nuclearand�defense�cooperation,�further�consolidatingthe�countries’�strategic�and�bilateral�relations.�
Best�wishes�through�the�holiday�season�and�for2010.
Regards,Russell
Russell Parera
Chief Executive Officer
KPMG in India
©�2009�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.
As�some�parts�of�the�world�rebound�from�the�downturn,�India�is�said�to�be�one�of
the�countries�leading�the�global�recovery�rally.�India’s�economy�grew�by�7.9
percent�in�the�September�quarter,�accelerating�from�the�6.1�percent�recorded�in
the�preceding�quarter.�Companies�in�the�region�are�likely�to�witness�significant
improvement�in�their�position�by�early�next�year.�According�to�analysts,�this�can
be�attributed�to�a�boost�in�domestic�demand�and�private�investment,�with�the
growth�in�the�Index�of�Industrial�Production�(IIP)�expected�to�continue.�
A�large�portion�of�this�growth�was�fueled�by�Government�stimulus�packages�and
a�cut�in�key�policy�rates.�However,�the�Reserve�Bank�of�India�is�now�indicating�a
shift�towards�a�tighter�monetary�policy�regime�through�a�recent�increase�in
statutory�liquidity�ratio�and�winding�up�some�re-financing�facilities.�The
Government�would�still�pursue�its�focus�on�economic�reforms,�especially�those
aimed�to�bring�the�deficit�under�control�while�ensuring�strong�expansion�in
investment�in�infrastructure.�
In�tune�with�industrial�growth,�the�Indian�capital�markets�have�also�shown
positive�signs�of�revival.�The�recent�Dubai�debt�crisis�is�expected�to�have�minimal
direct�impact�on�the�Indian�market�in�the�long�term.�According�to�analysts,�this
endurance�can�largely�be�attributed�to:
1)�The�amount�involved�being�relatively�small
2)�The�exposure�of�the�Indian�banking�system�to�the�Dubai�financial�system�from
the�point�of�view�of�direct�foreign�investment�or�FII�is�limited
Despite�good�performance�in�a�few�key�areas�for�growth,�experts�predict�that
agricultural�GDP�and�a�continuous�decline�in�exports�since�September�2008�are
likely�to�pose�concerns.�Agricultural�output�might�contract�sharply�in�the�last
quarter�of�the�year�2009-2010�as�a�result�of�bad�monsoons.��Also,�spawning�from
shortfalls�in�agricultural�output,�the�economy�is�expected�to�witness�a�rise�in
inflation,�both�for�retail�and�wholesale�prices,�with�figures�for�both�to�touch�7
percent�in�2012.�
As�a�step�towards�diluting�the�impact�of�bad�monsoons,�the�Government�is
focusing�on�innovation�in�agriculture.�Other�priority�areas�for�next�year�include
bringing�back�economic�growth�to�its�previous�highs�of�9�percent�per�annum,
through�continued�efforts�to�maintain�the�growth�in�domestic�demand�and
achieve�substantial�increase�in�infrastructure�investment.�
Indian EconomyPage 3 of 19
Analyst: Asmita Deshmukh, Nishtha Satyam©�2009�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.
7.9
6.15.85.8
7.87.88.6
0123456789
10
March qtr'08
June qtr'08
Sept qtr'08
Dec qtr'08
Mar qtr'09
Jun qtr'09
Sept qtr'09
% C
hang
e Y-
o-Y
India GDP at Factor Cost
Source:�EIU,�November�30,�2009
• Ducati to enter Indian premium bike segment
Italian�sports�bike�manufacturing�company�Ducati�Motor�Holdings�reportedlyopened�its�first�showroom�in�India�in�early�November,�in�partnership�withPrecision�Motor�India�Private�Limited.�The�company�is�expected�to�open�sixmore�showrooms�in�other�major�Indian�cities,�and�reportedly�aims�to�sell�atleast100�bikes�in�its�first�year�of�operation�in�India.�The�range�of�bikes�to�be�retailedin�India�is�likely�to�reportedly�be�priced�between�USD�20,500�and�USD�92,000.
• Michelin to set up USD 856 million plant in Chennai
Tyre�manufacturing�giant�Michelin�Group�has�reportedly�announced�plans�to�setup�a�truck�and�bus�radial�manufacturing�plant�near�Chennai,�entailing�aninvestment�of�nearly�USD�856�million.�The�company�has�reportedly�signed�aMemorandum�of�Understanding�with�the�Tamil�Nadu�government�to�this�effect.The�facility�is�expected�to�be�spread�across�290�acres�and�provide�localemployment�to�1,500�workers.�The�plant,�which�is�expected�to�be�operational�in2012,�is�to�focus�on�supply�to�the�Indian�market.
• Apollo Tyres to hike capacity by 50 percent
Indian�tyre�manufacturer�Apollo�Tyres�has�reported�announced�plans�to�augmentproduction�capacity�by�over�50�percent�in�India.�The�company’s�productioncapacity�is�to�reach�around�1600�tonnes�a�day�(from�its�current�daily�capacity�of950-1000)�once�its�Chennai�plant�reaches�terminal�capacity�in�the�first�quarter�of2010.�The�Chennai�plant�is�anticipated�to�be�operational�by�early�December.Apollo�Tyres�reportedly�plans�to�supply�half�of�the�Chennai�plant’s�output�toOEMs�and�the�remaining�to�the�aftermarket.
• Toyota India in plans to set up engine manufacturing plant
Toyota�Kirloskar�Motor�Private�Limited�is�reportedly�in�plans�to�set�up�an�engineand�transmission�plant�in�India.�The�plant�is�expected�to�be�built�at�thecompany’s�upcoming�second�manufacturing�facility�in�Bangalore,�for�which�thefirm�has�reportedly�announced�an�investment�of�USD�685�million.�Setting�up�ofthis�unit�in�India�is�expected�to�help�Toyota�increase�the�localization�levels�of�itsvehicles�as�well�as�reduce�manufacturing�costs.
• Volkswagen India to launch first SUV in India in December, Polo
hatchback next year
European�auto�major�Volkswagen�AG�is�reportedly�on�course�to�launch�theTouareg,�its�first�sports�utility�vehicle�for�the�Indian�market�by�early�Decemberthis�year.�The�SUV�is�reportedly�to�be�built�on�the�Porsche’s�Cayenne�platform,and�imported�as�a�completely�built�unit�(CBU).�It�is�expected�that�the�SUV�willbe�retailed�at�above�USD�64,000.
Volkswagen�has�reportedly�also�reiterated�its�intention�to�launch�the�Indianversion�of�its�international�bestselling�hatchback�model,�the�Polo;�the�car�isexpected�to�be�launched�in�India�in�2010.
Page 4 of 19
Auto and Auto Components
Analyst: Ranjeet Javeri and Kudrat Puri©�2009�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.
“We believe that the Indianmarket will be interesting anddevelop faster than any othermarket” Cristiano Silei, Vice-President (Sales), Ducati Motor Holding
(Source: DNA India, Ducati plans to sell 100 bikes byDec next year, November 2, 2009)
• RBI plans to increase the timeline for NPA Provisioning
The�Reserve�Bank�of�India�(RBI)�plans�to�give�banks�more�time�for�non-performing�assets�(NPA)�provisioning,�as�it�intends�to�extend�the�timeline�forNPAs�from�September�2010�to�March�2011.�As�per�the�Second�Quarter�Reviewof�Monetary�Policy�2010,�RBI�had�announced�that�the�banks�should�haveminimum�provision�coverage�of�70�percent�for�NPAs�by�September�2010,�whichwas�likely�to�impact�the�profitability�of�the�banks.�The�extension�might�allowbanks�to�step�up�gradually�their�provision�coverage,�thereby�reducing�the�impacton�profits.
According�to�credit�ratings�agency�CRISIL,��out�of�the�35�banks�rated�by�them,11�banks�have�provision�coverage�of�less�than�50�percent�and�about�16�haveprovision�coverage�of�between�50�percent�and�70�percent.
• HDFC acquires Credila Financial Services
To�foray�into�the�education�loan�segment,�Housing�Development�and�FinanceCorporation�(HDFC)�has�acquired�a�41�percent�stake�in�education�loan�providerCredila�Financial�Services�for�a�consideration�of�around�USD�2.1�million.�Thebank�has�acquired�the�stake�from�Merrill�Lynch,�which�was�an�initial�investor�inthe�company.�The�acquisition�will�enable�the�bank�to�enter�into�a�specializedmarket,�which�is�estimated�at�over�USD�6.4�billion.�The�Indian,�education�loanmarket�is�a�large�opportunity,�as�it�is�growing�at�a�rate�of�25-30�per�cent�peryear.
• PNB plans to acquire Dana Bank
Punjab�National�Bank�(PNB),�one�of�India’s�leading�public�sector�banks,�isplanning�to�acquire�a�majority�stake�in�Kazakhstan-based�Dana�Bank�for�aconsideration�of�around�USD�18�–�20�million�during�the�current�fiscal�year.�Theacquisition�will�enable�PNB�to�expand�its�business�in�the�overseas�market�bypenetrating�into�the�CIS�(Commonwealth�of�Independent�States)�countries.��
PNB�has�already�received�the�permission�from�Reserve�Bank�of�India,�India’scentral�bank,�approval�to�set�up�a�subsidiary�in�Vancouver.�Dana�bank�has�fivebranches�with�a�total�business�size�of�USD�60�million.
• SBI is planning to foray into wealth management business
State�Bank�of�India�(SBI),�India’s�largest�commercial�bank�by�balance�sheet�size,is�planning�to�foray�into�the�wealth�management�business�and�financial�planningservices�by�leveraging�its�extensive�branch�network.�The�bank�plans�to�targetmiddle�income�group�and�earn�additional�fee�income�through�the�business.�Itplans�to�employ�financial�planners�to�approach�account�holders�with�over�USD10,000�in�their�account.�
Page 5 of 19
Banking and Financial Services
Analyst: Kunal Jain and Ruchika Anand©�2009�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.
11%16%
25%
54%
-14%
9%
18%20%25%
29%21%
-11%
12% 12%
-20%
0%
20%
40%
60%
SCBs SBI Bank ofBaroda
BOI ICICI Bank HDFC Bank Axis Bank
Credit Growth Deposit Growth
Credit to Deposit Growth in Q2 2009 – 10
(y-o-y)
Source:�CRISIL�Research,�Quarterly�Update�onIndustry�Performance,�Q2�2009�–10�
• Pantaloon Retail in search of prospective acquisitions
Pantaloon�Retail,�one�of�the�largest�retailers�in�India,�is�in�search�for�potentialacquisitions�to�develop�its�food�business.�As�reported�by�the�company,�it�islooking�to�acquire�small�companies�and�has�been�in�discussion�with�variouscompanies�in�the�food�business.�However,�company�has�refused�to�provide�anyfurther�information�on�account�of�the�talks�being�very�premature.�
• Shoppers Stop sketches three year expansion plan
Shoppers�Stop,�one�amongst�India’s�largest�organized�retailers,�has�sketched�athree�year�expansion�plan�with�an�aim�to�increase�it�store�count�by�15�with�aninvestment�of�approximately�USD�54�million.�The�investment�is�expected�to�befunded�through�internal�accruals.�The�new�stores�are�likely�to�add�about�1�millionsquare�feet�of�space�and�expand�the�company’s�footprint�in�5�new�cities.�Thefive�new�cities�are�expected�to�be�the�tier-II�cites�like�Amritsar,�Ahmedabad,Mangalore,�Mysore�and�Vijaywada.�The�company�is�also�looking�to�open�a�fewnew�stores�in�Delhi�and�Mumbai�as�they�cumulatively�account�for�a�little�morethan�60�percent�of�the�company’s�total�sales.�The�company�recently�tied�up�forretailing�with�Mustang,�a�German�jeanswear�and�lifestyle�brand.
• GS Home Shopping in contract with TV18 HSN Holdings Ltd.
GS�Home�Shopping�Inc.,�a�South�Korean�TV�shopping�channel,�has�reportedlysigned�a�contract�with�India’s�TV18�HSN�Holdings�Ltd.�to�enter�into�the�Indianmarket.�As�per�the�reports,�the�contract�signed�entitles�GS�Home�Shopping�tobuy�a�15�percent�stake�in�the�holding�company�of�an�Indian�cable�TV�shoppingchannel�for�USD�18.4�million.�
• Bharti Wal-Mart to open 40 new stores
Bharti�Wal-Mart,�an�equal�joint�venture�between�Bharti�Group�and�Wal-Mart,�hasreported�to�expand�its�operations�in�India�by�opening�40�new�cash�and�carrystores�in�the�next�few�years.�Wal-Mart�opened�its�first�store�in�May�2009�inAmritsar�under�the�name�“Best�Price�Modern�Wholesale”�and�had�initiallyplanned�to�open�15-20�stores�in�three�years�and�employ�around�5,000�people.
• Reliance Footprints plans to open 10 stores in one year
Reliance�Footprints,�a�concept�store�by�Reliance�Retail�Limited�(100�percentsubsidiary�of�Reliance�Industries�Limited)�for�footwear,�handbags�andaccessories�has�planned�to�open�10�new�stores�in�the�financial�year�2009-10.The�company�currently�operates�through�15�stores�and�retails�various�brands.The�branded�products�account�for�85�percent�of�the�total�sales�whereas�thebalance�15�percent�is�through�private�labels.�The�company�plans�to�add�15-20stores�every�year�for�the�next�three�years�and�expand�its�operations�in�50�cities.
Page 6 of 19
Consumer Markets and Retail
©�2009�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.
Analyst: Rajiv Somani
“I had a meeting with the Wal-Mart chairman. They are verymuch satisfied with the results inIndia. I was informed by Wal-MartCEO that they are looking atopening more stores. He gave thefigure of 40 more across thecountry in immediate future” Anand Sharma, Commerce and Industry Chief, India (Source: Datamonitor News and Comments, BhartiWal-Mart to open 40 new stores in India, November12, 2009)
• Gateway Hotel to expand through management contracts
Indian�Hotels�have�launched�its�third�property�in�Rajastan�(Jodhpur)�under�thebrand�‘Gateway�Hotel’.�It�already�has�presence�in�Jaipur�and�Jaisalmer�inRajastan.�Currently,�the�brand�has�20�properties�in�its�portfolio�out�of�which�19have�been�migrated�from�Taj�Group�to�this�brand�as�a�part�of�the�re-brandingstrategy.�Additionally,�it�has�13�up-coming�hotel�projects�which�are�at�variousconstruction�stages.�All�these�13�properties�are�likely�to�be�operated�throughthe�management�contract�arrangement.�The�Gateway�Hotel�Jodhpur�is�the�firstproperty�which�is�operating�under�management�contract.�It�is�looking�for�moreproperties�with�minimum�room�capacity�of�150�rooms�for�its�managementcontracts.�The�brand’s�focus�is�to�expand�in�the�metros,�Tier-II�and�Tier-III�cities.�
• Oberoi expending its footprints in Middle East and SE Asian
markets
With�the�improving�global�economic�conditions�‘Trident’�(Oberoi�Group)�plans�torevive�its�overseas�expansion�strategy.�The�Oberoi�Group�plans�to�expend�itsTrident�brand�in�South�East�Asian�and�Middle�East�markets�next�year.�It�is�alsocoming�up�with�new�Trident�hotel�in�North�Mumbai�in�December.�The�group,which�owns�most�of�its�hotels,�is�actively�looking�at�management�contracts�forits�five-star�brand.�
• Marriott aggressively expanding in India
Marriott�International�plans�to�add�26�new�hotels�in�India.�It�is�expected�to�add6,000�rooms�to�its�existing�inventory�of�2,000�rooms.�It�has�planned�the�launchof�its�three�‘Courtyard’�hotels�in�November�2009�followed�by�the�launch�ofanother�eight�hotels�in�2010.�The�company’s�15�other�projects�are�indevelopment�stage.�
• Middle East hotels Jumeirah and Rotana plan to expand in India
Middle�East�hotels�Jumeirah�and�Rotana�are�eying�the�Indian�hotel�market�forexpansion.�Jumeirah�sees�the�Indian�hospitality�industry�as�a�future�growthmarket.�To�continue�growth�of�its�global�brand�presence�Rotana�is�also�lookingto�negotiate�with�property�owners�to�establish�its�brand�in�India.
• IHC to set up hotel in Bangalore
India�Hospitality�Corporation�is�likely�to�raise�funds�worth�USD�212�million�forexpansion�of�its�hotel�business.�The�company�is�planning�to�expand�in�tier�IIcities.�It�is�looking�for�both�organic�and�inorganic�growth�paths�to�expand�itspresence�in�the�country.�The�company�has�signed�an�agreement�to�manage�10hotels�with�a�realty�firm�Entertainment�World�Developers�Pvt�Ltd.�These�hotelsare�expected�to�come�up�by�2011.�The�firm�has�already�invested�USD�4.2�millionin�the�hotel�business�through�its�wholly-owned�subsidiary,�Gordon�HouseEstates.�The�company�currently�operates�its�hotel�chain�under�the�brand'Gordon�House'�and,�has�three�hotel�properties�in�the�country,�two�in�Mumbaiand�one�in�Pune.�
Page 7 of 19
Analyst: Pallavi Phatak
Hospitality
©�2009�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.
“We are seeing ARRs gettingcorrected across the country. Wewill continue to see this trendduring such times. By March 2010,we expect occupancy to go upagain” Akshay Kulkarni, Executive Director (South Asia) forCushman and Wakefield - Hospitality(Source: Business Standard, Bangalore may faceoversupply of luxury rooms, November 14, 2009)
• HCL Technologies bags deal from UK-based Equitable Life
Assurance Society
HCL�Technologies�has�signed�a�multi-year�deal�worth�about�USD�200�millionwith�UK-based�insurance�firm�Equitable�Life�Assurance�Society�(ELA).�As�perthe�terms�of�the�deal,�HCL�would�provide�complete�solutions,�including�policyadministration,�finance,�actuarial�services,�IT�operational�support�and�call�centerservices�to�ELA.��The�deal�has�been�signed�with�HCL�Insurance�BusinessServices,�HCL’s�UK-based�life�and�pensions�administration�business�arm.
• Indian ESO sector to reach USD 50 billion by 2020
According�to�a�study�conducted�by�Booz�&�company,�India's�EngineeringServices�Outsourcing�(ESO)�sector�is�likely�to�reach�USD�50�billion�by�2020,�andgenerate�employment�of�25-30�million.�Cost�arbitrage�and�availability�of�skilledprofessionals�in�the�country�might�be�a�major�driving�force�behind�this�increase.The�study�further�states�that�half�of�these�ESO�revenues�are�likely�to�comefrom�US�while�Europe�would�contribute�40�percent�and�the�rest�would�be�fromJapan.�
• Infosys acquires McCamish Systems
Infosys�Technologies�has�acquired�Atlanta-based�McCamish�Systems�LLC,�abusiness�process�solutions�provider.�The�acquisition�is�likely�to�add�about�USD7-8�million�revenues�to�Infosys’s�revenues�in�March�quarter.�The�upfrontconsideration�for�the�deal�is�USD�38�million�with�up�to�an�additional�USD�20million�payable�to�the�sellers�if�McCamish�Systems�achieves�certain�financialtargets�in�the�future.�With�this�acquisition,�Infosys�expects�to�enhance�itscapability�to�deliver�end-to-end�business�solutions�for�the�insurance�andfinancial�services�industries�and�to�contribute�positively�to�strategy�of�growingnon-linear�revenue.�On�the�other�hand,�McCamish�believes�that�the�mergerwould�enable�it�to�service�larger�portfolios�of�transactions�for�clients�and�expandinto�global�markets.�Also�,�the�deal�would�establish�Infosys�as�a�key�player�inproviding�business�platform�services.
• Wipro opens second facility in China
Wipro�Ltd.,�one�of�the�major�software�service�providers�in�India,�has�opened�itssecond�facility�in�China�at�Chengdu�to�provide�IT�and�back-office�services�to�itsglobal�clients.�This�facility�has�started�operations�with�100�staff,�and�thecompany�plans�to�increase�the�headcount�to�1,000�people.�Wipro�already�has�afacility�in�Shanghai.
• KPIT Cummins acquires Sparta Consulting
Pune-based��IT�service�provider�KPIT�Cummins�(KPIT)�Infosystems�Ltd,�hasacquired��Sparta�Consulting�(Sparta)�for�about�USD�38�million.�Founded�in�2007by�Paul�Freudenberg�and�Lokesh�Sikaria,�California–based�Sparta�provides�highend�SAP�solutions.�It�mainly�operates�in�California�with�a�unit�in�India�located�atNoida.�KPIT�believes�that�this�acquisition�would�strengthen�its�business�modelto�focus�on�select�industries�and�achieve�market�leadership.�The�move�isexpected�to�result�in�greater�efficiencies�and�increased�market�share�for�KPIT.�
Page 8 of 19
Analyst: Parnika Patil
IT / ITeS
©�2009�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.
“The Indian offshore industry isgrowing on the back of improvingdemand and continuedadvantages of India as an offshoredestination. India-centric suppliersare investing in deliverycapabilities and setting up newcenters” A survey by Everest's Market Vista: Q3 2009 (Source: The Economic Times, Indian offshore industrysaw increased momentum in Q3, November 5, 2009)
• Scripps Networks acquires controlling stake in NDTV Lifestyle
US-based�Scripps�Networks�Interactive�has�acquired�69�percent�stake�in�NDTVGroup’s�lifestyle�programming�subsidiary�NDTV�Lifestyle.�The�transaction�isexpected�to�be�completed�by�the�end�of�first�quarter�of�2010.�Scripps�NetworksInteractive�is�the�lifestyle-oriented�content�developer�for�television�and�theInternet.�NDTV�Group,�in�a�separate�transaction�repurchased�USD�100�millionstep�up�coupon�bonds�due�in�2012.�This�sets�NDTV�free�from�the�restrictiveclause�and�allows�the�company�to�look�for�investors�for�its�different�verticals.�
• PVR acquires DT Cinemas and dilutes 10 percent stake to Cineplex
PVR�Cinemas�has�acquired�the�exhibition�business�of�DT�Cinemas�Ltd,�asubsidiary�of�DLF,�in�a�cash-cum-stock�deal.�According�to�the�structure�of�thedeal,�the�company�is�expected�to�pay�a�cash�component�of�USD�4.3�million�andallot�2.55�million�shares�representing�9.1�percent�of�the�fully�diluted�paid-upshare�capital�of�PVR�to�DT�Cinemas.�With�this�acquisition,�the�total�number�ofproperties�would�move�up�to�28�with�134�screens�from�24�properties�and�108screens.
The�company�would�also�dilute�10�percent�equity�stake�to�Cineplex,�a�Thailand-based�cinema�company�for�approximately�USD�9�million.
• Dish TV raise USD 100 million through global depository receipts
Apollo�Management,�US-based�asset�management�firm�is�planning�to�acquire11�percent�stake�in�Dish�TV,�direct-to-home�(DTH)�service�provider.�Dish�TV�israising�the�funds�through�issue�of�global�depository�receipts�(GDR)�to�acquirenew�subscribers.�With�a�subscriber�base�of�approximately�6�million,�Dish�TV�isIndia’s�largest�DTH�operator.���
• Union Cabinet gives approval to digitize Cable TV
Union�Cabinet�has�given�its�approval�for�the�Headend�in�the�Sky�(HITS)�policywhich�is�aimed�at�digitizing�cable�TV�operations�through�out�the�country.�Thecabinet�has�also�approved�74�percent�Foreign�Dir�ect�Investment�(FDI)�in�theHITS�segment�and�49�percent�for�cable�TV�operators.�However,�ForeignInvestment�Promotion�Board’s�approval�would�be�required�for�FDI�over�49percent.�Information�and�Broadcast�ministry�has�four�pending�applications�forHITS�services�and�hopes�the�service�providers�to�roll-out�services�within�a�year.
• Dar Capital firm is highest bidder for IPL theatrical rights
Entertainment�and�Sports�Direct�(ESD),�promoted�by�investment�advisory�andprivate�equity�firm�Dar�Capital�Group,�has�emerged�as�the�highest�bidder�withUSD�70.4�million�for�the�Indian�Premier�League's�(IPL)�theatrical�rights.�The�deal,from�2010�to�2019,�is�expected�to�give�ESD�exclusive�exhibition�rights�foraudiences�in�cinema�halls,�water-borne�vessels,�buses,�trains,�hotels�and�otherpublic�venues.�There�were�two�bids�received�for�the�theatrical�rights�tenderfrom�Triplecom�Media�and�ESD.�However,�ESD�bid�is�subject�to�final�approvalfrom�the�IPL�Governing�Council.��
Page 9 of 19
Media
Analyst: Mehul Desai©�2009�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.
“We firmly believe that the IPL is asuperior sporting event that hastransformed the very landscape of cricketglobally. Together with our partners UFOMoviez and Valuable Media, we areconfident of bringing about a radicaltransformation in the way the sport ofcricket is viewed and enjoyed by fansacross the world. We believe that thereare significant untapped businessopportunities that are being addressed bythis association that will create a globalbenchmark” Arun Rangachari, Director, ESD
(Source: IndianTelevision.com, Dar Capital firm ishighest bidder with USD 70.4 million for IPL theatricalrights, November 12, 2009)
• Oman Oil to further invest in Bina Refinery
Oman�Oil�Company�(OOC)�is�likely�to�invest�an�additional�approx.�USD�244million�(INR�1,220�crore)�in�the�USD�2.4�billion�Bina�refinery�project.�The�projectis�being�implemented�by�Bharat�Oman�Refineries�Ltd.�(BORL)�in�MadhyaPradesh.�This�infusion�of�funds�is�likely�to�increase�OOC’s�stake�from�thecurrent�2�to�26�percent.�BORL�is�a�joint�venture�(JV)�company�of�BharatPetroleum�Corporation�Ltd.�(BPCL)�and�OOC.�It�was�formed�in�1993�but�OOChad�frozen�its�investments�following�inordinate�delays�in�the�implementation�ofthe�refinery�project.
• EGOM decides to allocate another 50 MMSCMD of KG-D6 gas
The�Empowered�Group�of�Ministers�(EGOM)�has�decided�to�allocate�another�50million�metric�standard�cubic�meters�per�day�(MMSCMD)�of�Krishna�Godavari(KG)�D6�gas�to�industrial�consumers.�Of�the�50�mmscmd,�20�mmscmd�is�likelyto�be�allocated�on�firm�basis�to�industrial�consumers�in�power,�fertilisers,�steel,petrochemicals,�refineries�and�city�gas�distribution�and�the�remaining�30mmscmd�is�likely�to�be�allocated�on�a�fall�back�basis.�The�additional�allocation�isexpected�to�increase�the�overall�customer�base�for�supply�of�gas�therebyavoiding�frequent�changes�in�the�production�level�from�the�block.�
• BPCL, Videocon-led consortium finds more oil in Brazil
A�consortium�of�Bharat�PetroResources,�Videocon�Industries�and�AnadarkoPetroleum�Corporation�has�discovered�additional�oil��in�their�Wahoo�2�well�block.The�Wahoo�2�well�is�located�in�block�BM-C-30,�5�miles�to�the�north�from�theoriginal�Wahoo�discovery�well,�which�hit�over�195�feet�of�net�oil�pay�in�Octoberlast�year.�Anadarko�Petroleum�is�the�operator�of�block�BM-C-30�and�holds�a�30percent�stake.�US-based�Devon�Energy�Corporation�and�IBV�Brazil�Petroleo�–�ajoint�venture�(JV)�between�Videocon�and�Bharat�PetroResources�(BPCL’soverseas�exploration�and�production�firm)�hold�25�percent�interest�each�in�theblock�BM-C-30�whereas�South�Korea's�SK�Energy�holds�the�remaining�20percent.
• Mangala oil field's output touches 20,000 barrel oil per day mark
Oil�production�from�Rajasthan's�prolific�Mangala�field�has�touched�the�mark�of20,000�barrels�per�day.�Earlier�Cairn�India�(Cairn)�had�successfully�tested�thefirst�horizontal�production�well�at�this�oil�field�at�a�record�test�production�rate�ofmore�than�11,500�barrels�of�oil�per�day.�According�to�news�reports,�36development�wells�were�drilled,�of�which�26�have�been�completed.�Cairn�hasalso�concluded�an�initial�agreement�to�supply�crude�oil�from�the�Mangala�field�toReliance�Industries�Limited�(RIL)�in�Jamnagar,�Gujarat.
Page 10 of 19
Oil and Gas
Analyst: Sidharth Balakrishna and Suman Lala©�2009�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.
SectorFirm
allotments
Fallback
allotments
Existing Assets
Power�(including�plantsto�be�commissioned�in2009-10)�-beyond�18MMSCMD�earmarkedearlier
12.07(+0.875)* 12
Non-Urea�subsidized 0.178� -
Fertilisers
Steel�(only�for�feedstock) 0.44 -
Petrochemicals�(only�forfeedstock) 1.918 -
Refineries 5 6
CGD�projects�(forindustrial�&�commercialsectors)
2
Captive�power�plants 10
Total19.606
(+ 0.875)*30
*�For�4�power�plants�of�AP�at�75�percent�PLF,�subjectto�verification�by�MoP�III.
Allocation of 50 MMSCMD additional gas to
various priority sectors
Source: Infraline, EGOM finalizes allocation of another 50
MMSCMD of KG-D6 gas to industrial
consumers, November 12, 2009
• Ranbaxy launches generic version of blockbuster drug ’Valtrex’
with 180-day exclusivity
Ranbaxy�Laboratories�Limited,�one�of�India’s�leading�pharmaceutical�companies,has�reportedly�launched�the�generic�version�of�GlaxoSmithKline�Plc’s�(GSK)�anti-herpes�drug�Valtrex�(valacyclovir)�in�the�US.�The�company�was�granted�180-dayexclusivity�for�the�drug�in�2007.�The�drug,�believed�to�be�launched�on�November25,�2009,�is�available�in�the�form�of�500mg�and�1g�tablets.�Valtrex�had�sales�ofaround�USD�2.2�billion�in�the�US�in�2008.�Ranbaxy�manufactured�valacyclovirfrom�the�production�facility�of�its�US�subsidiary�Ohm�Laboratories.�
• Draft bill finalized to set up NCHRH; MCI, PCI, dental, nursing
councils likely to be abolished
The�draft�bill�to�set�up�the�National�Council�for�Human�Resource�in�Health�(NCHRH)has�reportedly�been�finalized.�NCHRH�is�expected�to�be�formed�as�an�overarchingregulatory�body�to�help�in�determining�and�regulating�the�standards�for�medicaleducation�in�India.�This�move�expects�to�aid�India�in�bridging�the�gaps�in�healthcaremanpower�and�resources.�This�Council�is�likely�to�replace�the�existing�medical,dental,�nursing�and�pharma�councils�in�India.�The�health�ministry�has�opened�thefinalized�draft�bill�for�public�scrutiny.
• Ecron Acunova enters into alliance with Tokyo CRO
Ecron�Acunova,�a�Bangalore-based�contract�research�organization,�and�Japan-based�Tokyo�CRO�Inc.�have�reportedly�joined�hands�to�extend�their�network�ofservices�and�facilitate�clinical�trials�in�expanded�geographies.�While�EcronAcunova�is�likely�to�get�the�opportunity�to�tap�the�Japanese,�Chinese�andKorean�markets�where�Tokyo�CRO�has�established�its�presence,�Tokyo�CRO�isexpected�to�leverage�on�the�alliance�to�expand�into�India,�Europe�and�the�US.
• Jubilant forms a JV for developing new drugs
Jubilant�Organosys�Limited,�an�Indian�pharmaceutical�company,�has�reportedlyformed�a�Joint�Venture�(JV)�with�the�University�of�Alabama�at�Birmingham�andUS-based�Southern�Research�Institute.�The�JV�is�expected�to�look�intodeveloping�new�drugs�especially�in�areas�of�oncology,�metabolic�and�otherinfectious�diseases.�The�agreement�includes�the�discovery�and�the�developmentof�the�most�promising�biological�targets�by�the�three�entities.
• Intas and Orbus Pharma sign a non-binding offer agreement
Intas�Pharmaceutical�Limited,�an�Indian�healthcare�company�and�Orbus�PharmaInc.,�a�Canadian�pharmaceutical�major,�have�reportedly�signed�a�non-bindingoffer�for�the�sale�of�the�product�rights�of�the�latter’s�‘Metoprolol�Succinate’�forthe�continental�European�region�and�any�other�territories�(except�the�US).Metoprolol�Succinate�can�be�used�alone�or�in�combination�with�other�drugs�inthe�treatment�of�high�blood�pressure.�The�transaction�is�expected�to�be�closedby�January�2010.
Page 11 of 19
Pharma
Analyst: Nandita Kudchadkar and Parnika Dayal
©�2009�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.
“To overcome the acute shortage and
uneven distribution of human resources inpublic health delivery system, the Ministryof Health & Family Welfare aims atoverhauling the current regulatoryframework. Toward this end, it is proposedto set up a National Council for HumanResources in Health as an overarchingregulatory body to achieve the objective ofenhancing the supply of skilled personnel
in the health sector” Task Force for setting up of the National Council forHuman Resources in Health
(Source: Report of the Task Force for setting up of theNational Council for Human Resources in Health,Ministry of Health and Family Welfare, Government ofIndia, 2009)
• NTPC diversifies into hydro power
State�owned�National�Thermal�Power�Corporation�(NTPC)�is�diversifying�intohydro�power�to�become�an�integrated�energy�utility�with�a�diversified�fuel�mix.�Ithas�set�a�target�to�generate�9000�megawatt�(MW)�of�hydroelectricity�by�2017,�ofwhich�2000�MW�are�expected�to�be�generated�from�Uttarakhand�and�HimachalPradesh.�The�hydro�projects�planned�in�Uttarakhand�are�520MW�TapovanVishnugad,�600MW�Loharinag�Pala,�171MW�Lata�Tapovan�and�261MW�RupsiaBhagar�Bara�while�the�one�in�Himachal�Pradesh�is�800MW�Koldam�project.�
The�USD�1402�billion�Tapovan�Vishnugad�project�is�expected�to�becommissioned�by�December,�2011�six�months�ahead�of�schedule.
• PFC enters into a JV to promote energy efficiency projects
Power�Finance�Corporation�(PFC)�has�entered�into�a�Joint�Venture�(JV)�withNational�Thermal�Power�Corporation�Ltd,�Power�Grid�Corporation�of�India�Ltdand�Rural�Electrification�Corp�Ltd�and�set�up�a�company,�Energy�EfficiencyServices�Ltd�(EESL),�to�promote�projects�involving�energy�efficiency,conservation�and�climate�change.�The�venture�with�each�partner�holding�anequal�share,�has�been�set�up�with�an�equity�contribution�of�approximately�USD89�billion.�It�plans�to�promote�energy-efficiency�projects�such�as�Bachat�LampYojana,�Agricultural�Demand�Side�Management�and�Municipal�Demand�SideManagement�and�targets�a�revenue�of�USD�327�billion.
• Cabinet approves National Solar Mission
The�Cabinet�recently�approved�the�Jawaharlal�Nehru�National�Solar�Mission�toreduce�the�dependence�on�fossil�fuels.�The�mission,�with�an�initial�investment�ofUSD�2027�billion,�is�planned�to�be�implemented�in�three�phases�and�aims�toprovide�20,000�MW�to�the�national�grid�by�2022.�
The�Government�has�appointed�NTPC�Vidyut�Vyapar�Nigam�Ltd�as�the�nodalagency�for�reaching�power�purchase�agreements�which�would�sell�the�powerbought�from�solar�project�developers�to�State�utilities.�This�would�be�thencredited�against�the�compulsory�renewable�energy�purchase�targets�set�by�therespective�State�Electricity�Regulatory�Commissions.
• BHEL enters into a JV to set up thermal power plant
Bharat�Heavy�Electricals�Limited�(BHEL)�entered�into�a�Joint�Venture�(JV)�withMadhya�Pradesh�Power�Generation�Company�Limited�to�set�up�a�1600�MWpower�plant�at�Khandwa�in�Madhya�Pradesh.�The�plant,�with�an�equal�share�heldby�both�the�partners�initially,�would�be�equipped�with�supercritical�technologyfor�lower�coal�consumption�and�lower�emissions.�The�stakes�would�be�laterdiluted�to�26�percent�each,�with�the�rest�held�by�financial�institutions�and�otherpartners.
BHEL�has�also�entered�into�joint�ventures�with�the�southern�states�of�TamilNadu�and�Karnataka�to�set�up�and�operate�supercritical�thermal�power�plants.
Page 12 of 19
Power
Analyst: Sidharth Balakrishna and Neha Saraf©�2009�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.
“Currently wind power generationin the country stands at about10,500 MW. We will double thiscapacity by 2022 and try to tripleit” Farooq Abdullah, Minister for New and Renewable
Energy
(Source: The Economic Times, Govt to double windpower generation by 2022, November 27, 2009)
• SEBI eases norms for raising funds
The�capital�market�regulator,�Securities�and�Exchange�Board�of�India�(SEBI)�haseased�norms�for�security,�or�the�asset�cover,�required�for�issuing�securedbonds.�The�move�is�expected�to�benefit�housing�finance�companies,�whichusually�issue�partly�secured�debt�securities,�faced�problems�in�raising�funds,�ascompanies�usually�sold�debentures�with�an�underlying�security�that�was�onlyworth�a�fraction�of�the�amount�raised.
• DIPP proposes relaxation of FDI norms for realty
The�Department�of�Industrial�Policy�and�Promotion�(DIPP)�has�proposed�furtherrelaxation�of�FDI�norms�for�the�real�estate�sector.�Presently,�a�three�year�lock-inperiod�is�required�an�original�investment�made�into�the�integrated�townshipdevelopment�and�other�construction�development�projects.�Considering�theintensity�of�the�FDI�inflows�in�the�real�estate�sector,�the�department�wants�toremove�the�condition�of�minimum�period�for�the�repatriation�of�the�originalinvestment.�The�proposal�is�currently�being�discussed�with�various�otherministries.
• RMZ takes first steps in residential real estate market
Real�estate�developer�RMZ�Corp.,�which�has�over�the�years�specialized�incommercial�property�development,�is�planning�to�have�its�presence�in�theresidential�segment�by�2010.�By�2011-12,�the�company�expects�to�have�50:50commercial�and�residential�portfolio�mix.�In�the�first�phase�the�company�isplanning�to�develop�row�houses�and�apartments�in�Hyderabad�and�Bangalore,while�in�the�second�phase�of�the�rollout,�the�firm�plans�to�kick�off�projects�inKochi�and�Chennai.��
• Brigade Group joins the queue for affordable housing projects
Bangalore�based�real�estate�developer�Brigade�is�planning�to�leverage�thechanging�market�scenario�with�the�launch�of�affordable�housing�projects�totalingup�to�10,000�units�in�the�city�by�FY2010-11.�The�firm�also�has�plans�to�launchaffordable�housing�projects�in�Mysore,�Chennai,�Hyderabad�and�Mangalore.�Thecompany�is�in�talks�with�various�banks�to�raise�the�required�funds�for�itsaffordable�venture.�
• Low rentals boost commercial estate sales
According�to�top�builders,�the�correction�in�the�commercial�realty�rates�inmetros�by�20�to�40�percent�is�expected�to�improve�the�sales�by�50�percent�inQ3�and�Q4�of�2009-10.�Large�builders�in�various�metros�are�tapping�thisopportunity�by�offering�ready-to-possess�offices,�shops�and�commercial�plots�at15-20�percent�discount.���
Page 13 of 19
Real Estate and SEZs
Analyst: Rajiv Parekh©�2009�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.
Source: Real Estate Developers, Goldman
Sachs, October 26, 2009
415 423
53131
233 199 224 205 194337
233357
1324
822
0
200
400
600
800
1000
1200
1400
Jul-0
8
Aug-
08
Sep-
08
Oct
-08
Nov
-08
Dec
-08
Jan-
09
Feb-
09
Mar
-09
Apr-0
9
May
-09
Jun-
09
Jul-0
9
Aug-
09
Squa
reFe
e t( 0
00s)
Mumbai Total Absorption
Monthly Commercial Absorption (Mumbai)
Page 14 of 19
Telecom
Analyst: Neha Dayal and Rishabh Chadha ©�2009�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.
• Reliance Communication cuts SMS tariff to one paisa
Reliance�Communication�has�further�augmented�the�tariff�wars�by�announcing�anew�plan�which�allows�users�to�SMS�at�one�paisa�and�has�also�launchedanother�plan�allowing�users�to�send�unlimited�text�messages�for�USD�0.02�(INR1)�per�day�and�capping�the�number�of�messages�per�month�under�this�plan�to15,000.���
• Successful bidders to use 3G spectrum after June, 2010
DoT�has�announced�that�the�successful�bidders�for�the�3G�auctions,�scheduledto�be�held�in�January�2010,�will�likely�be�able�to�utilize�the�spectrum�only�afterJune,�2010.�This�is�due�to�the�fact�that�the�armed�forces�would�require�a�fewmonths�to�shift�operations.
• TRAI recommends porting charge of USD 0.41 (INR 19)
The�Telecom�Regulatory�Authority�of�India�has�stated�that�mobile�users�optingfor�Mobile�Number�Portability�(MNP)�will�have�to�pay�USD�0.41�(INR�19)�or�lessto�avail�the�service.�With�an�estimated�25�percent�of�users�likely�to�opt�for�MNP,this�is�likely�to�serve�as�a�catalyst�for�operators�to�introduce�new�incentives�andschemes�to�attract�and�retain�customers.
• Essar takes 51 percent stake in Uganda, Congo telcos
The�Essar�Group,�led�by�the�Ruias’�is�set�to�acquire�a�51�percent�stake�in�DhabiGroup’s�telecom�operation�in�Uganda�and�Congo�for�USD�150�million.�Essar�islikely�to�invest�this�amount�in�Warid�Telecom�in�Uganda�and�Congo�to�enhancenetwork�quality�and�is�likely�to�eventually�take�over�the�majority�stake�in�boththese�companies.�
• Over 500 million telecom users in India
The�Indian�Telecom�industry�has�surpassed�the�target�of�500�million�mobile�andlandline�subscribers.�The�target�has�been�achieved�almost�a�year�in�advance.�Atthe�end�of�October,�the�number�of�mobile�users�stood�at�488.4�million�and�thenumber�of�fixed�line�users�stood�at�37.25�million.
Operator
Wireless Net Adds
('000s)
Sept '09 Oct '09
Tata�Teleservices 4,006.8� 3,867.7�
Vodafone�Essar 1,971.6� 2,980.2�
Bharti�Airtel 2,514.9� 2,702.1�
Reliance 2,005.0� 2,096.5�
Aircel 1,313.1� 2,018.2�
Idea�Cellular 1,395.9� 1,900.5�
BSNL 1,452.2� 675.2�
Sistema�Shyam 228.4� 335.8�
MTNL 17.3 58.2�
Loop�Telecom�(BPL) 77.6 50.1�
HFCL (0.6) (13.6)
Total 14,982.3� 16,671.0�
Others2%
Aircel6%
Tata Teleservices10%
Idea Cellular11%
BSNL12%
Vodafone Essar
Reliance18%
Bharti Airtel23%
Wireless Net Additions (Sept-Oct, 2009)
Wireless Net Additions (Sept-Oct, 2009)
Source: TRAI Press Release, November 21, 2009 and November 04, 2009
• Kakinada forms JV with Sembawang
Kakinada�Seaports�Ltd�has�formed�a�joint�venture�(JV)�with�SembawangShipyard,�a�wholly�owned�subsidiary�of�Sembcorp�Marine�Ltd.,�to�set�up�amarine�and�offshore�facility�on�the�eastern�coast�of�India.�The�two�companiesare�looking�at�tapping�the�oil�exploration�and�shipping�activities�in�the�regionespecially�the�repair�and�reconstruction�activities�of�offshore�vessels.Sembawang�is�planning�to�invest�about�USD�375�million�in�phases�and�isexpecting�to�achieve�a�financial�closure�in�the�coming�three�months.�The�JV�isplanning�to�get�business�from�companies�who�send�their�vessels�to�Singaporefor�repair�and�maintenance�and�help�these�clients�to�save�around�20-30�percenton�the�costs�involved.�The�facility�is�expected�to�be�constructed�over�a�period�on3-5�years�and�offer�services�like�new�buildings,�conversions,�repairs�andservicing�of�offshore�vessels�and�ships,�building�of�offshore�modules�andequipment.
• Kingfisher to raise USD 600 million
Kingfisher�Airlines�is�planning�to�raise�about�USD�600�million�funds�to�pay�off�itsdebt�and�strengthen�the�company’s�financial�position.�The�shareholders�haveapproved�a�USD�100�million�rights�issue�and�USD�100�million�Global�DepositoryReceipts)�GDR�issue.�The�company�is�said�to�be�in�talks�with�various�privateequity�funds�to�raise�about�USD�400�million�funds.
• Foreign airlines can add more flights in India
The�Directorate�General�of�Civil�Aviation�(DGCA)�has�issued�new�guidelines�forforeign�airlines�to�operate�flights�to�India.�As�per�the�new�guidelines,�foreignairlines�can�operate�additional�capacity�of�up�to�10�percent�of�their�entitlementsduring�high�air�traffic.�The�guidelines�also�have�withdrawn�the�right�of�Air�India,India’s�national�carrier,�to�issue�a�No-Objection�Certificate�(NOC)�to�clear�theextra�flights�which�fall�under�bilateral�entitlements.�This�means�foreign�airlinescan�now�operate�larger�aircraft�or�operate�additional�flights�during�the�peakseason�and�cater�to�the�increased�demand.
• Blackstone invests USD 350 million in Gateway Rail
Blackstone�Group,�the�US�based�private�equity�has�acquired�a�37.5�percentstake�in�Gateway�Rail,�a�subsidiary�of�Gateway�Distriparks,�through�compulsoryconvertible�bonds.�Blackstone�is�said�to�have�invested�about�USD�350�million�forthe�stake.�
• TVS Logistics acquires Multipart Holding
TVS�Logistics�Services�Ltd.�has�acquired�Multipart�Holding,�UK-based�logisticsupply�chain�company.�Through�this�acquisition�the�company�is�planning�toexpand�its�operations�in�the�defense�and�utility�services.�The�company�is�lookingat�more�such�acquisitions�in�the�US�and�the�European�regions�to�expand�itspresence�globally.�It�also�plans�to�enter�the�South�American�and�Chinesemarkets�by�the�year�2010.�
Page 15 of 19
Transport and Logistics
Analyst: Nitin Dehadraya©�2009�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.
“Transportation & logisticsindustry in India is in very flexibleposition and there are a lot ofopportunities that are yet to beexplored. Analyzing the industry'sgrowth and structure, we believewe can bring major significantchanges in Indian markets. Wehope should there changes aredone, it will increase the GDP to aconsiderable growth” A Bhowmik, Managing Director, Duetsche LogisticsGroup(Source: Supplychain.cn, Deutsche Logistics invest US$150 mn in India, November 23, 2009)
Page 16 of 19
©�2009�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.
Reference material for preparing this document was takenfrom the following sources:
Note:1�USD=�46.7�INR
Sources
Foreword:
• Moneycontrol.com,�Indian�banks�pass�with�flying�colours�in�RBI�report,�Oct�22,�2009
• Bloomberg.com,�India�Faces�‘Challenge’�Timing�Monetary�Stimulus�Exit,�Nov.�10,�2009�
• Reuters,�RPT-POLL-India's�Sept�industrial�output�seen�up�7.3�pct�y/y,�Nov�12,�2009
Economy:
• Livemint,�Second�Quarter�GDP�at�7.9�%,�November�30,�2009�
• International�Monetary�Fund�
• The�Economic�Times,�No�Need�for�Panic:�FM�on�Dubai�Crisis,�November�29,�2009�
• Economy:�Overview�and�Outlook,�Crisil�Research�
• Livemint,�OECD�Expects�India�to�Grow�at�7.3%�in�2010,�November�25,�2009
• ThaiIndian�News,�Stimulus�to�Continue�till�Robust�Recovery�Takes�Place:�Mukherjee,�November�10,�2009
Auto
• CarTradeIndia,�Ducati�to�sell�100�bikes�next�year,�November�09,�2009
• The�Times�of�India,�Super�bike�maker�Ducati�sets�shop,�November�01,�2009
• Hindustan�Times,�Rs�4,000-cr�Michelin�plant�in�Tamil�Nadu,�November�16,�2009
• Company�press�release,�Michelin�group�commits�Rs.4000�crore�for�a�manufacturing�plant�in�India,�November�27,2009
• Business�Standard,�Apollo�Tyres�to�up�capacity�by�50�percent,�November�12,�2009
• The�Financial�Express,�Toyota�to�set�up�engine,�transmission�plant�in�India,�November�24,�2009
• Wheels�Unplugged,�VW�India�to�roll�out�its�first�SUV�Touareg�by�early�Dec�’09,�November�13,�2009
BFSI:
• The�Hindu�Business�Line,�Reserve�Bank�of�India�(RBI)�may�increase�the�timeline�for�NPA�Provisioning,�November26,�2009��
• Economic�Times,�State�Bank�of�India�is�planning�to�foray�into�wealth�management�business,�November,�3,�2009
• Economic�Times,�Punjab�National�bank�plans�to�acquire�Dana�Bank,�November�24,�2009�
• Financial�Express,�HDFC�acquires�Credila�Financial�Services,�November�13,�2009�
• Business�Standard,�Indian�Public�Sector�Banks�planning�for�overseas�expansion,�November�26,�2009�
CM:
• Just-food.com,�Pantaloon�on�acquisition�hunt,�November�20,�2009
• Hindustan�Times,�Shoppers�Stop�to�invest�USD�54�million�to�open�15�stores,�November�17,�2009
• Asia�Pulse,�s�Korea’s�GS�Home�Shopping�to�make�inroads�into�India,�November�16,�2009
• Hindustan�Times,�Bharti�for�40�cash�&�carry�stores�in�India,�November�9,�2009
• ATSHOA,�Reliance�on�its�footprints,�October�31,�2009
Page 17 of 19
©�2009�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.
Hospitality:
• The�Times�of�India,�Taj’s�Gateway�Hotel�checks�into�Jodhpur,�November�10,�2009
• The�Economic�Times,�Trident's�Middle�East,�SE�Asian�foray�next�year,�November�10,�2009
• Hindustan�Times,�Marriott�to�add�26�new�hotels�in�India,�November�03,�2009
• Middle�East�Tourism�and�Hospitality,�November�04,�2009
• The�Statesman,�IHC�plans�Rs�1000�crore�fund,�November�06,�2009
IT:
• The�Economic�Times,�‘HCL�Technologies�bags�USD�200�million�deal�from�UK�firm’,�November�24,�2009
• The�Economic�Times�‘Indian�ESO�to�touch�USD�50�billion�by�2020’�November�18,�2009
• Khandwala�Securities,�‘Infosys�Technologies’,�November�12,�2009
• The�Economic�Times�‘Wipro�launches�second�facility�in�China’,�November�26,�2009
• Business�Standard��‘KPIT�Cummins�buys�Sparta�for�INR�180�crore,�October�31,�2009
Media:
• IndianTelevision.com,�Scripps�Networks�takes�controlling�stake�in�NDTV�Lifestyle,�November�19,�2009�
• ICICI�Report,�PVR�Limited:�What’s�Changed,�November�16,�2009�
• Economic�Times,�US'�Apollo�Management�to�acquire�11%�in�Dish�TV�for�USD�100�million,�November�24,�2009�
• Indian�Express,�Cabinet�nod�to�digitize�cable�TV,�November�13,�2009�
• IndianTelevision.com,�Dar�Capital�firm�is�highest�bidder�with�USD�70.4�million�for�IPL�theatrical�rights,�November12,�2009
Oil and Gas:
• Hindustan�Times,�Oman�Oil�Company�to�invest�INR�1,220�crore�in�Bina�refinery,�November�15,�2009�
• Infraline,�EGOM�finalizes�allocation�of�another�50�MMSCMD�of�KG-D6�gas�to�industrial�consumers,�November�12,2009
• Business�Standard,�BPCL,�Videocon-led�consortium�finds�more�oil�in�Brazil,�November�24,�2009
• Infraline,�Bharat�Petroleum's�overseas�exploration�and�production�business�receives�a�shot-in-the-arm�with�asubstantial�discovery�of�oil�in�Brazil,�November�24,�2009�
• The�Financial�Express,�Mangala�oil�field's�output�touches�20k�barrel�oil�per�day�mark,�November�14,�2009�
• The�Economic�Times,�RIL�to�join�hunt�for�shale�gas,�November�16,�2009
Pharma:
• Livemint,�Ranbaxy�launches�generic�version�of�Valtrex�in�US,�November�27,�2009
• Business�Standard,�Ranbaxy�launches�GSK's�blockbuster�drug�in�US,�November�27,�2009
• The�Times�of�India,�Goodbye�MCI?�Bill�on�health�edu�watchdog�ready,�November�16,�2009
• BioSpectrum,�Ecron�Acunova,�Tokyo�CRO�form�strategic�alliance,�November�12,�2009
• Business�Standard,�Jubilant�inks�JV�with�UAB,�Southern�Research�Institute,�November�24,�2009
• Company�Press�Release,�Orbus�Pharma�Signs�Non-Binding�Offer�For�Sale�Of�Metoprolol�Succinate�Product�RightsFor�Europe�And�Any�Other�Territories�Except�United�States,�November�18,�2009
Power:
• The�Telegraph,�NTPC�aims�big�in�hydel�power,�November�23,�2009
• The�Hindu�Business�Line,�PFC�venture�with�power�PSUs,�November�19,�2009
• The�Hindu�Business�Line,�Cabinet�clears�national�solar�mission,�November�19,�2009
• The�Economic�Times,�BHEL�to�set�up�power�plant�in�central�India,�November�18,�2009
• The�Economic�Times,�Govt�to�double�wind�power�generation�by�2022,�November�27,�2009
Page 18 of 19
©�2009�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.
Real Estate:
• Indian�Express,�Sebi�eases�norms�for�raising�funds,�November�28,�2009
• Business�Standard,�DIPP�proposes�further�relaxation�of�FDI�for�realty,�October�30,�2009
• DNA�Money,�RMZ�keys�into�residential�real�estate�market,�November�03,�2009
• DNA�Money,�Brigade’s�Rs�2,000-cr�plan�for�value�housing,�November�18,�2009
• Indian�Realty�News,�Low�rentals�boost�commercial�real�estate�sales,�November�28,�2009
Telecom:
• The�Hindu�Business�Line,�RCom�cuts�SMS�tariff�to�one�paise,�November�27,�2009
• Business�Standard,�3G�spectrum�winners�can�use�it�only�after�June,�November�21,�2009
• Business�Standard,�Cell�users�can�change�telcos�for�Rs�19�only,�November�21,�2009
• Business�Standard,�Essar�takes�51%�stake�in�Uganda,�Congo�telcos,�November�16,�2009
• The�Economic�Times,�Telcos�surpass�500�mn�user�base�target�a�year�in�advance,�November�05,�2009;�TRAI�(PressRelease�No.�78�/2009),�November�21,�2009
• Business�Standard,�DoT�relents,�to�seek�TRAI�view�on�uniform�license�fee,�November�04,�2009
Transport and Logistics:
• DNA,�Kakinada�Seaports,�Sembavang�in�JV,�November�27,�2009
• Business�Standard,�Kingfisher�to�raise�$600�m,�mostly�to�pay�off�debt,�November�10,�2009
• Business.rediff.com,�Foreign�airlines�can�add�more�flights�in�India,�November�13,�2009
• Financial�Express,�Blackstone’s�Rs�300-cr�push�for�Gateway�Rail,�November�10,�2009
• The�Hindu�Business�Line,�TVS�Logistics�acquires�UK�co�Multipart�Holding,�November�11,�2009
• Supplychain.cn,�Deutsche�Logistics�invest�US$�150�mn�in�India,�November�23,�2009
in.kpmg.com
©�2009�KPMG,�an�Indian�Partnership�and�a�member�firmof�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.All�rights�reserved.KPMG�and�the�KPMG�logo�are�registered�trademarks�ofKPMG�International,�a�Swiss�cooperative.
The�information�contained�herein�is�of�a�general�nature�and�is�not�intended�to�address�the�circumstances�of�any�particular�individualor�entity.�Although�we�endeavour�to�provide�accurate�and�timely�information,�there�can�be�no�guarantee�that�such�information�isaccurate�as�of�the�date�it�is�received�or�that�it�will�continue�to�be�accurate�in�the�future.�No�one�should�act�on�such�informationwithout�appropriate�professional�advice�after�a�thorough�examination�of�the�particular�situation.
Contact�us:
For further information about thisnewsletter, please contact:
Ramesh SrinivasHead - Consumer Marketse-Mail: [email protected]: +91 80 3065 4300
Abizer DiwanjiHead - Financial Servicese-Mail: [email protected]: +91 22 3090 2380
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Jai MavaniHead - Infrastructure & Governmente-Mail: [email protected]: +91 22 3090 1920
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Research�Inputs�by�KPMG’s�IndiaResearch�Center
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Hyderabad8-2-618/2Reliance Humsafar, 4th FloorRoad No.11, Banjara HillsHyderabad - 500 034Tel: +91 40 3046 5000Fax: +91 40 3046 5299
KolkataInfinity Benchmark, Plot No. G-110th Floor, Block – EP & GP, Sector VSalt Lake City, Kolkata 700 091Tel: +91 33 4403 4000Fax: +91 33 4403 4199
Pune703, Godrej CastlemaineBund GardenPune 411 001Tel: +91 20 305 85764/65Fax: +91 20 305 85775
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