Organic Growth

Bharti enters mobile handset market

Bharti Airtel India today announced that they will enter the lucrative mobile handset manufacturing business via its subsidiary Beetel Teletech Limited.

According to Indian media reports, Bharti is planning to serve the lower end with cheap mobile phones in the range of Indian rupees. 1,750-7,000.

Making an announcement, Beetel Teletech Limited (a Bharti Group firm) Executive Director and CEO Vinod Sawhny said, “The market is huge and there is a room for Indian players...Phones in the price range of Rs. 2,000-6,000 are witnessing 30 per cent growth and we plan to offer a good combination of feature-rich phones at affordable prices.”

On the market, which has a mix of leading global players like Nokia, Samsung, Sony Ericsson and Motorola and home-grown companies like Micromax, Karbonn and others, he said the company was a long-term player and has set an ambitious target of being among the top five players in the next three years.

Bharti Airtel through its subsidiary Bharti Airtel Sri Lanka started its operations in Sri Lanka in January 2009.

Indian Bank to open branch in Jaffna

Indian Bank to open branch in Jaffna

Public sector lender, Indian Bank wishes to expand its overseas reach. The Chennai based bank is all set to open a full fledged branch in Jaffna, which is the capital of the northern province of Sri Lanka.

This would be the second branch of the bank in the country. It already has a branch in Colombo.

After SriLanka, the bank is targeting Jakarta in Indonesia. The branch is Jakarta is expected to be the representative office.

“We have got all necessary clearances from different departments of the Indian government including the finance ministry’s go-ahead to RBI. We are expecting to get the licence within a fortnight’s time. In such an eventuality, we are hopeful of setting up a branch there by November,” TM Bhasin, chairman & managing director of Indian Bank, said.

While talking about the idea behind opening a branch in Jaffna, Bhasin said, “There are a lot of opportunities coming in Jaffna. About Rs 1,000 crore has been earmarked for housing development in Jaffna — mostly for rehabilitation of the Indians. Besides, there are a lot of opportunities for entrepreneurship development”.

ASEAN+3 Forum Discusses Harmonizing Asia's Bond Markets

MANILA, PHILIPPINES - The ASEAN+3 Bond Market Forum (ABMF) met for the first time today in Tokyo, Japan to discuss how best to harmonize regulations and market practices in Asia’s local currency bond transactions.

The ABMF is largely made up of financial experts from the 10 countries of the Association of Southeast Asian Nations (ASEAN), plus the People’s Republic of China, Japan and the Republic of Korea. It aims to establish regional market standards and common practices to make cross-border bond investment and settlement both smoother and cheaper.

The local currency bond markets in emerging East Asia have grown steadily in recent years, with $4.8 trillion in bonds outstanding at the end of June 2010. However, cross-border transaction costs in the region are high at an estimated three times more than in developed markets.

Common trading standards would make it faster and cheaper for investors from across the region to dip in and out of their neighboring markets. A wider variety and larger number of investors in Asia’s bonds would also make the markets more efficient and thus a better place for borrowers to raise funds.

“The forum is a big step towards institutionalizing regional cooperation and should help integrate Asia’s bond markets,” said Noritaka Akamatsu, Deputy Head of the Asian Development Bank’s (ADB) Office of Regional Economic Integration. “Ultimately, an integrated Asian bond market would benefit issuers and investors not only in Asia but also in the rest of the world.”

As a first step, the ABMF will create two sub-forums. One will collate and compare regulations and market practices in the region, while the second will look to harmonize transaction procedures and bond messaging formats with a view to cutting the cost of cross-border deals.

The forum was set up on the recommendation of a Group of Experts consisting of leading public and private sector institutions, including national central securities depositories from ASEAN+3 countries, international central securities depositories, global and regional custodians, and the ADB. It was endorsed by finance ministers of ASEAN+3 when they met in Tashkent, Uzbekistan in May.

The Group of Experts and the ABMF are part of ASEAN+3’s Asian Bond Markets Initiative (ABMI) aimed at fostering cross-border bond transactions. The ABMI was set up by the ASEAN+3 Finance Ministers in 2003 to develop local currency bond markets and to channel Asian savings into the region.

Update on Price band

As at yesterday, a 10% price band is presently applicable for two listed securities, Vallibel Finance (From Sep 23 to Oct 13) and Lake House Printers and Publishers PLC (from Sep 24 to Oct 14), a CSE filing made yesterday  stated.

Govt. aims to conclude Shell Gas takeover soon

By Santhush Fernando

Sri Lankan government is to conclude the re-acquisition deal of Shell Gas Lanka (Pvt) Ltd. (SGLL), the country’s largest Liquid Petroleum Gas (LPG) player in the very near future.
“The due diligence was earlier conducted and the Shell deal will be concluded in the very near future,” Sirisena Amarasekera, chairman of the Cabinet appointed Negotiating Committee overseeing the Shell deal and Prime Minister’s Secretary, told The Bottom Line.
Another senior official close to the deal confirmed that it was ‘unofficially finalised’ that the government will buy Shell’s 51 percent holding.
Last June, SGLL’s parent company- Royal Dutch Shell (RDS) offered to sell Shell Gas Lanka Ltd. and its wholly-owned subsidiary, Shell Lanka Terminal Ltd., as a part of its worldwide strategy to review its business units in Europe, Asia and Latin America. While the government already owns 49 percent stake of Shell Gas Lanka Ltd., Shell Lanka Terminal Ltd. is fully owned by the RDS. On June 17, the government expressed its willingness to take-over Shell Gas Lanka.
Earlier, W K H Wegapitiya, Chairman, Laugfs Holdings Ltd., Shell Gas Lanka’s rival and also a prospective bidder, announced that Laugfs too was interested in purchasing Shell Gas Lanka after his visit to London for negotiations with Royal Dutch Shell.
SGLL has been engaged in importing, storing, filling, marketing and selling LPG in Sri Lanka since 1995, after 51 percent of the then Colombo Gas Company was sold to Shell for US $ 37 million during the then Chandrika Bandaranaike Kumaratunga regime.
Shell virtually ran a monopoly till the second player, Laughs Gas, entered the local LP Gas market. Third players - Mundo Gas and Power Gas never succeeded to take off the ground due to undercutting by an existing player.