B-Gyan

Weekly Newsletter

29 September 2010 – 05 October 2010

Power & Energy | Finance | FMCG | IT & Telecom | Manufacturing

 POWER & ENERGY

Goldman funds acquire Endesa's Spanish gas assets for $1.1 bn news

Italian energy giant Enel SpA's Spanish subsidiary Endesa SA has agreed to sell 80-per cent stake in
its arm Endesa Gas SA to two infrastructure funds operated by global investment and securities
major Goldman Sachs for approximately €800 million ($1.1 billion).

< http://www.domain-b.com/finance/banks/goldman_sachs/20100929_gas_assets.html >

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World’s Largest Solar Energy Facility powers up

An 80MW photovoltaic project in Sarnia, Canada, is now fully operational and is supplying energy to
Ontario's power grid. The project is expected to make enough energy from sunlight to power 12,800
homes, its owner Enbridge Inc said. Enbridge bought the 20 MW Sarnia project from First Solar, the
world's biggest solar company by market value, last year in an agreement in which First Solar
remained as the project's operator. The two companies then expanded the project's capacity by 60
MW.

< http://www.pv-
tech.org/chip_shots/_a/sarnia_hits_80mw_first_solar_enbridge_open_worlds_largest_for_now_ph
otovolt/ >

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Big Players to enter LED manufacturing

Energy majors including ONGC Ltd. and NTPC Ltd., and some other players will enter the LED
manufacturing market. This will ensure the technology breaches the price barrier through scale up in
production. LED lamps are solid state lighting devices that utilise light emitting diodes as a source of
illumination instead of electrical filaments or gas and hence cuts down heavily on energy
consumption. Besides they do not contain mercury associated with CFLs.

< http://www.thehindubusinessline.com/2010/10/04/stories/2010100451720200.htm >

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B-Gyan Newsletter 29.09.2010-05.10.2010 1

Moser Baer Photo Voltaic: Reducing solar cell breakage from laser to shrink
wrap
Moser Baer Photo Voltaic overcame the problem of damage to the delicate photovoltaic cells
through the manufacturing process by devising an in-house solution to win the Qimpro quality
award for manufacturing at the 22nd Qimpro Convetion

< http://www.domain-b.com/companies/companies_q/qimpro/20100929_moser_baer.html >

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Power Grid's `8,600-crore follow-on share sale set for November

State-run power distribution utility Power Grid Corp will come out with a follow-on public offer of
shares worth around `8,600 crore (around $1.9 billion) in the first half of next month.

<http://www.domain-
b.com/companies/companies_p/Powergrid_Corporation/20100929_share_sale.html >

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B-Gyan Newsletter 29.09.2010-05.10.2010 2

 FINANCE

ICICI Bank ups lending rates by 25 bps

The leading lender ICICI Bank affected a 25 basis points increase in its base rate to 7.75 per cent on
5th Oct 2010. It also hiked its interest rates for various tenors of fixed deposits by 0.25-50 per cent.
Earlier on the same day the second largest private sector lender HDFC Bank raised its minimum
lending rate by 0.25 bps to 7.50 per cent with immediate effect. It hiked its benchmark prime
lending rate by 0.5 per cent to 16.25 per cent. In the past few days, many banks hiked their base
rates and interest rates, which include Bank of Baroda, Development Credit Bank and many more.

< http://economictimes.indiatimes.com/news/news-by-industry/banking/finance/finance/ICICI-
Bank-ups-lending-rates-by-25-bps/articleshow/6693663.cms >

____________________________________________________________________

Banking license to give access to cheap funds

Non-banking Finance Companies, or NBFCs, receive higher valuations compared to banks. Investor
interest in these companies has further risen after the Reserve Bank of India’s proposal to bring
some of these NBFCs under the banking domain. Banking index has an average P/E of around 13
during FY10, the P/E of NBFC index has been hovering around 22. This shows that NBFCs have
received much higher investor participation compared to banks.

< http://economictimes.indiatimes.com/news/news-by-industry/banking/finance/finance/Banking-
licence-to-give-access-to-cheap-funds/articleshow/6687277.cms >

____________________________________________________________________

RBI allows corporates to act as BCs, bars NBFCs

Aiming to promote financial inclusion, the Reserve Bank has allowed corporates and post offices to
function as business correspondents (BCs), but barred non-banking finance companies (NBFCs) from
it. RBI in its revised guidelines mentioned that "Taking into consideration the pros and cons and
based on the feedback received from various quarters, it has been decided to permit banks to
engage companies registered under the Indian Companies Act, 1956, excluding NBFCs, as BCs”

< http://economictimes.indiatimes.com/news/news-by-industry/banking/finance/finance/RBI-
allows-corporates-to-act-as-BCs-bars-NBFCs/articleshow/6647807.cms >

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B-Gyan Newsletter 29.09.2010-05.10.2010 3

JPMorgan's PE arm to invest `160 cr in Rohan Lifescapes
The private equity arm of JPMorgan Chase & Co is likely to invest `160 crore in the first phase of the
city-based Rohan Lifescapes. JPMorgan’s arm will get around 26% stakes in the project and the deal
is likely to fetch 24-25% internal rate of return a year.

The first phase of the project will entail development of 700,000-800,000 sq ft residential
apartments on a vacant plot that is part of the 8.2 acre. The project, to be launched in January, will
have 1,200-1,800 sq ft apartments priced at an initial offer rate of `18,000-20,000 a sq ft.

< http://economictimes.indiatimes.com/news/news-by-
industry/banking/finance/finance/JPMorgans-PE-arm-to-invest-Rs-160-cr-in-Rohan-
Lifescapes/articleshow/6661494.cms >

____________________________________________________________________

IDFC plans to triple loan book in next 3-4 yrs

IDFC, a leading 33 year-old knowledge-driven financial services company in India which went public
in 2005, is planning to triple loan book in the next three to four years. IDFC achieved a PAT (Profit
After Tax) of `11 crore last year and are looking at a 35-40 per cent CAGR in the coming years.

IDFC launched the firms’ first long-term tax-free infrastructure bonds on September 30 and will be
open for subscription upto October 18, 2010. The bonds will be listed after the five-year lock-in
period is over. Each of these bonds has a face value of `5,000 and an investor can get income tax
rebate of upto `20,000 under section 80 CCF, which was introduced in the Finance Act 2010- over
and above all the prevailing deductions.

< http://economictimes.indiatimes.com/news/news-by-industry/banking/finance/finance/IDFC-
plans-to-triple-loan-book-in-next-3-4-yrs/articleshow/6651848.cms >

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B-Gyan Newsletter 29.09.2010-05.10.2010 4

 FMCG

Dabur to take franchise route to expand retail venture

Consumer goods firm, Dabur India Ltd will start adopting the franchise route for its stores 'Newu'
and explore smaller format stores in order to expedite expansion. It is also trying express or smaller
formats that have quick turnaround time, besides focusing on 'beauty' as a category, as it looks to
break even in the next two years.

Franchise: A type of license that a party (franchisee) acquires to allow them to have access to
a business’s (the franchisor) proprietary knowledge, processes and trademarks in order to allow the
party to sell a product or provide a service under the business's name. In exchange for gaining
the franchise, the franchisee usually pays the franchisor initial start-up and annual licensing fees.

<http://economictimes.indiatimes.com/news/news-by-industry/cons-products/fmcg/Dabur-to-take-
franchise-route-to-expand-retail-venture/articleshow/6629688.cms >

____________________________________________________________________

Intex Technologies to foray into television segment

Information technology devices maker will enter colour television and LCD TVs segment, currently
dominated by Korean majors Samsung and LG, within this month. The company will sell products
under the 'Intex' brand which will be priced up to 10 per cent less than brands that are currently
leading the market. The highly competitive Indian television market is currently dominated by
brands such as LG, Samsung, Sony, Videocon and Panasonic and Onida.

< http://economictimes.indiatimes.com/news/news-by-industry/cons-products/durables/Intex-
Technologies-to-foray-into-television-segment/articleshow/6583970.cms >

____________________________________________________________________

ADF Foods acquires US-based Elena's Food Specialties

ADF Foods Ltd, a leading packaged Indian food provider, today said that it has entered into an
agreement to acquire a substantial portion of the assets of Elena Food Inc. Elena is a US-based
manufacturer and marketer of organic and natural products and a leading provider of protein-based
Mexican foods in the natural and organic category. It clocked a turnover of USD nine million in 2009.
ADF will acquire all significant assets and certain liabilities of Elena's for an agreed consideration, a
press release issued here stated, without, however, mentioning the amount.

< http://economictimes.indiatimes.com/news/news-by-industry/cons-products/food/ADF-Foods-
acquires-US-based-Elenas-Food-Specialities/articleshow/6658054.cms >

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B-Gyan Newsletter 29.09.2010-05.10.2010 5

Sweden's IKEA pitches to enter India
Swedish home furniture giant pitched on Monday for fast-growing to open up its huge retail market
to foreigners and said it planned more stores in emerging market giant China. India's tight
investment rules restrict overseas retail firms to "back-end" wholesaling -- except for single-brand
outlets such as Nokia or -- to protect local, family-run stores which fear being driven out of business.
Currently 51% is allowed in single brand retail category.

The privately-held IKEA, which uses its profits as a means to invest in social programmes, could also
help with upgrading Indian production technologies in such areas as textiles, plastic goods and other
products.

<http://economictimes.indiatimes.com/news/news-by-industry/cons-
products/durables/Swedens-Ikea-pitches-to-enter-India/articleshow/6594887.cms>

____________________________________________________________________

Godrej Security looking at 75% market share in 5 years

Godrej Security Solutions (GSS), part of the $3 billion Godrej Group, is targeting a 75 percent market
share and a turnover of `1,000 crore (2013-14) from `500 crore targeted this year for the security
division. A division of the Godrej & Boyce Manufacturing Company, GSS launched Defender Z+ Safes
in the city. The total security market in the country is around `600 crore now.
GSS, which has 23 branches with 650 dealers across the country, clocked a turnover of `400 crore
last year.

Of the total turnover, export comprises 12 percent, which the company plans to take to 15 percent
this year by focusing more on countries like Britain, Germany, Scandinavian countries and Russia
along with Africa and the US

< http://economictimes.indiatimes.com/news/news-by-industry/cons-products/durables/Godrej-
Security-looking-at-75-market-share-in-5-years/articleshow/6684007.cms >

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B-Gyan Newsletter 29.09.2010-05.10.2010 6

 IT & TELECOM

Skype eyes integration with Facebook

Skype is eyeing integration with Facebook. The Facebook-Skype deal will integrate messaging, voice
chat and Facebook Connect if signed. This association will boost up the user base of Skype by
providing a global interface. The integration of Skype and Facebook shall be beneficial to both as
Skype’s global reach will increase and Facebook will be able to utilize Skype’s efficient
communication tools.

< http://itvoir.com/portal/news/News/Skype-eyes-integration-with-Facebook-8-326.asp >

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Microsoft sues Motorola over patent infringement

Microsoft sued Motorola over patent infringement of Android devices. The world’ largest software
maker, Microsoft, claimed that Motorola infringed nine of its patents in the new Android-based
smart phones.

Motorola strained its relationship with Microsoft by shifting towards Google's free Android as a
more suitable and luring option. The patents filed by Microsoft relate to synchronizing e-mail,
calendars and contacts, scheduling meetings and notifying applications of changes in signal strength
and battery power as reported.

< http://itvoir.com/portal/news/News/Microsoft-sues-Motorola-over-patent-infringement-8-
335.asp >

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TCS, Infosys, Wipro in race for IRDA IT project

Indian IT giants, including TCS, Infosys and Wipro, have been shortlisted by insurance regulator IRDA
for financial bidding to implement its enterprise resource planning (ERP) system.
Besides TCS, Infosys and Wipro, two other firms Mahindra Satyam and Deloitte have also been
selected for the financial bidding, which is the third phase of the ERP technical tendering process.

< http://economictimes.indiatimes.com/infotech/software/TCS-Infosys-Wipro-in-race-for-IRDA-IT-
project/articleshow/6684886.cms >

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B-Gyan Newsletter 29.09.2010-05.10.2010 7

Attrition in Indian IT firms seen easing
Indian IT firms are likely to get a breather from high attrition levels in the coming quarters as effects
of pay hikes and stable project pipelines kick in.

The sector, one of the biggest employers in Asia's third-largest economy, has seen firms scramble for
skilled employees following a rise in outsourcing demand but has also been hit by increased attrition
levels.

<http://economictimes.indiatimes.com/infotech/ites/Attrition-in-Indian-IT-firms-seen-
easing/articleshow/6671098.cms >

____________________________________________________________________

Tata communications to acquire Suntel

Tata Communications Ltd is set to acquire Sri Lanka's second largest land based telephone
company, Suntel Ltd. TCL (formerly VSNL), which was acquired by the Tatas following the
government's divestment in 2002, has received the approval of the government, which still owns
26% stake in the company, for the proposed acquisition.

< http://timesofindia.indiatimes.com/tech/news/telecom/Tata-communications-to-aquire-
Suntel/articleshow/6683583.cms >

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B-Gyan Newsletter 29.09.2010-05.10.2010 8

 MANUFACTURING

IVRCL Infrastructure and Projects bags `1,119.76 crore order

IVRCL Infrastructure and Projects various divisions have won orders worth `1,120 crore from sectors
including power and transportation. The company's water division bagged the highest `451 crore
orders, followed by `440 crore by building divisions, `136 crore by transportation division and `92
crore by power division.

IVRCL group is a diversified conglomerate with presence in road, water, power, oil and gas and
building segments.

< http://economictimes.indiatimes.com/news/news-by-industry/indl-goods-/-
svs/construction/IVRCL-Infrastructure-and-Projects-bags-Rs-111976-crore-
order/articleshow/6684809.cms >

____________________________________________________________________

With no govt deals L&T's defence unit may face loss

Larsen & Toubro (L&T), which has invested `2,500 crore to manufacture ships for the defence sector
in Kattupalli in Tamil Nadu, faces the prospect of loss on its investments in the absence of
government orders. The government is placing the order for manufacturing warships to public sector
firms and importing submarines from foreign countries.

The Indian defence sector has planned to spend `4,50,000 crore on military equipment in the next
10 years. India imports 70% of its defence requirements, while the remaining is produced by
Defence Public Sector Undertakings (DPSU) or its collaboration entities.

< http://economictimes.indiatimes.com/news/news-by-industry/indl-goods-/-svs/engineering/With-
no-govt-deals-LTs-defence-unit-may-face-loss/articleshow/6681021.cms >

____________________________________________________________________

Ultratech September sales up 2.71 pc to 28.47 lakh tonnes

Aditya Birla Group firm Ultratech Cement's sales rose by 2.71 per cent to 28.47 lakh tonnes in
September this year, compared to the corresponding period of the previous year. Production also
increased by 2.91 per cent to 28.19 lakh tonnes during the month in comparison to September,
2009.

< http://economictimes.indiatimes.com/news/news-by-industry/indl-goods-/-svs/cement/Ultratech-
September-sales-up-271-pc-to-2847-lakh-tonnes/articleshow/6684120.cms >

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B-Gyan Newsletter 29.09.2010-05.10.2010 9

DuPont to invest $100 mn to step up R&D here
US-based chemicals giant DuPont plans to invest up to $100 million (approximately `452 crore) over
the next three years to expand its research and development (R&D) unit in Hyderabad. DuPont is
targeting revenue of $1 billion from its Indian business by 2012, compared with $500 million in 2009.

The proposed investment in India is part of DuPont’s global growth plans, termed as ‘megatrends’
within the company, that include tapping growth in emerging markets, increasing food productivity
and decreasing dependence on fossil fuels and security solutions business. DuPont is focusing more
on emerging economies as developed countries struggle to emerge from the recession.

< http://economictimes.indiatimes.com/news/news-by-industry/auto/automobiles/Maruti-
develops-hybrid-SX4-with-25-more-fuel-efficiency/articleshow/6644996.cms >

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Punj Lloyd subsidiary bags `614 crore orders from Singapore' PUB
Infrastructure major Punj Lloyd’s subsidiary Sembawang Engineers and Constructors Ltd, bagged
water treatment project contracts worth `614 crore from Singapore's national water agency PUB.
The project is for construction of a new 60 million imperial gallons of water (MIGD) waterworks at
Lower Seletar at the junction of Western Road Link and the Seletar Expressway in Singapore.

< http://economictimes.indiatimes.com/news/news-by-industry/indl-goods-/-svs/construction/Punj-
Lloyd-subsidiary-bags-Rs-614-crore-orders-from-Singapore-PUB/articleshow/6664621.cms >

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B-Gyan Newsletter 29.09.2010-05.10.2010 10