Information Digest Weekly Published by: Students of MBA

Volume: 12, February 10, 2010 Indian Maritime University, Chennai

----- BUSINESS -----

• The country's exports grew for the second straight month in December by 9.3 per
cent to USD 14.60 billion (around Rs 68,000 crore) against USD 13.36 billion in
December 2008. Import figures too rose in December after 11 months, by 27.2 per
cent to USD 24.75 billion compared to USD 19.45 in December 2008.

S
• Petroleum Secretary S Sundareshan said that the government would decide on
raising price of natural gas produced by state-owned ONGC and Oil India by 30 per
cent.

T • India's largest car manufacturer Maruti Suzuki India reported its highest monthly
sales of 95,649 units for January 2010, a jump of 33.3 per cent against 71,779 units
in January 2009. Maruti Suzuki India said in a release that these figures were the
I highest ever domestic as well as total sales for the company. During January 2010
domestic sales figures stood at 81,087 units and exports at 14,562 units against

M •
4,774 units in January 2009, a 205 per cent against the month in the year ago.
Makaan.com has launched the country’s first Property Index, Makaan.com Property
Index (MPI). The tool is aimed to come up with up-to date information related to

U movement in residential property prices. The Index is intended to serve as an

L
expected to be used by both real-estate buyers and the industry.
• World Bank in its new report titled ‘Global economic prospects 2010’ said that
India is expected to grow at 7.5 and 8 per cent in the financial year 2010 and 2011

U respectively. The report added that India would remain one of the top three
developing country destinations for foreign investors and Global GDP, which
declined by 2.2 per cent in 2009, is expected to grow 2.7 per cent this year and by

S •
3.2 per cent in 2011.
The Securities and Exchange Board of India said mis-selling (by hiding risk factors)
of financial products was a serious issue which warranted regulatory intervention.
Several firms selling financial products market them in such a way that the products
looked attractive, hiding the risk factors, especially in the Mutual Fund industry.
However, companies hide the risk factors involved in those products (mis-selling).
• Micro, Small and Medium Enterprises (MSME) Ministry has sought Rs.5,500 crore
Your quest from the Union Finance Ministry to help it recover from the aftermath of the global
for economic slowdown that has hit the sector hard, after the submission of the task
knowledge force report on MSME sector to Prime Minister Manmohan Singh. MSME sector,
ends here … which employs 4.2-crore people and contributes about 45 per cent to the total
manufactured output and 40 per cent to our exports.
• An expert group headed by Kirit Parikh • Visa Inc posted a quarterly profit of $763
suggested freeing of petrol and diesel prices million, in its fiscal first quarter ended December
and raising LPG rates by Rs 100 per cylinder 31, compared with profit of $574 million a year
and kerosene by Rs 6 per litre. Freeing petrol earlier.Visa, operator of the world's largest credit
and diesel prices would result in an increase of and debit payment network, receives fees
Rs 3 per litre in petrol prices and Rs 3-4 in whenever consumers use one of its credit or debit
diesel prices.At present, the government does cards. As consumers worldwide increasingly pay
not allow state-running fuel retailers to fix using plastic, the company's revenue rises.
petrol, diesel, kerosene and LPG prices in line • Essar Oil, India's largest private fuel retailer
with international cost, resulting in huge plans to nearly double its petrol pumps to 2,500
revenue losses for the companies and subsidy by March 2011. Essar currently sells petrol and
burden on government. diesel produced at its 280,000 barrels per day
• The Reserve Bank of India has withdrawn refinery at Vadinar in Jamnagar district of
the facility of short-term foreign currency Gujarat through 1,293 petrol pumps. Essar is
borrowings provided to NBFCs and housing expanding the non-fuel retail activities at its
finance companies (HFCs) as the economy is outlets and plans to dispense CNG and Auto LPG
on rebound and liquidity in the system is from the outlets this year.
improving. After sources of funds dried up • India received USD 1.5 billion foreign direct
due to global financial meltdown, the RBI had investment (FDI) in December 2009, an increase
allowed NBFCs and HFCs in 2008 to raise of over 10 per cent in the same month of
short-term foreign currency borrowings not previous year. The overseas inflows, however,
exceeding 50% of the net owned funds or $10 declined marginally to USD 20.9 billion in April-
million, whichever was higher. December 2009 compared to USD 21.15 billion
• National Council of Applied Economic in the corresponding period last year.
Research (NCAER) has upped its GDP (gross • In its yearly performance report, the National
domestic product) growth projection for the Association of Software and Service Companies
current fiscal to a conservative 7 per cent, just (Nasscom) has said that the information
a tad higher than the 6.9 per cent forecast technology and business process outsourcing
earlier, but still way below the revised (BPO) industry would see its exports reach $50
estimates by the government and the Reserve billion in the current financial year, registering a
Bank of India (RBI). growth of over 5 per cent. The report also added
• Monster Worldwide Inc said on that the domestic IT-BPO market is likely to
Wednesday that it will buy Yahoo Inc's reach Rs.66,200 crore, clocking a growth of 12
HotJobs site for $225 million in cash, citing an per cent, while in the next fiscal domestic
improving job market.Once the deal is done, revenues are likely to grow by 15-17 per cent to
Careerbuilder will be the major competitor to touch Rs.76,100-77,500 crore, particularly due to
Monster. Careerbuilder, owned by US government IT spending and there would be an
newspaper publishers Gannett Co Inc, of 90,000 jobs. Before the recession, the industry
McClatchy Co and Tribune Co, as well as was adding almost three-lakh jobs annually. The
software maker Microsoft Corp, has the report also added that the direct employment
largest part of the online job ads market. would cross 23 lakh while the indirect
Under the terms of the deal, Monster will pay employment would cross 82 lakh.
Yahoo $20 million to $31 million a year for
Yahoo to redirect traffic to its site.
• Siemens announced its plans to invest Rs. turbines with a capacity of 200 MW a year
1,600 crore in India over the next three years initially. The company also planned to have a
for its wind turbine manufacturing venture presence in solar power. The rest of the
and for expanding its existing production investment will go in research and
capacity. Of the total investment, Rs. 500 development activities as well as to increase
crore would be used for setting up a high-end manufacturing capacity for its products in
technology wind turbine manufacturing signalling and metal technologies and
facility, which would be set up either in healthcare solutions. Siemens also indicated
Tamil Nadu or Gujarat. The plant would be that it would also look for opportunities in the
operational by 2012 and would produce airport and ports sectors.
• Kraft Foods won control of Cadbury on
Tuesday as holders of almost 72 per cent of ----- SHIPPING & LOGISTICS -----
the British chocolatier's stock accepted the
11.7 billion pound takeover that will create • Within four years of its setting up, the
the world's biggest confectioner. It is Karaikal port got rail connectivity last week.
predicted from Kraft’s words of “$675 The port is being developed by Karaikal Port
million of annual cost savings from the deal”, Private Ltd (KPPL), a wholly-owned
would have job cuts on 45,000 workers of subsidiary of Marg Ltd. The Karaikal-Nagore
Cadbury around the world. rail link is being developed by Southern
• State-run NTPC’s follow-on public offer Railway, and this link will connect Karaikal
(FPO), the first public issue of this year by Port with cement, steel, chemical, aluminium
the government, has managed to get fully and textile units, as well as other major
subscribed on Friday — the closing day of manufacturing industries in Ariyalur, Tiruchi
the issue. The issue received bids for 49.56 and Salem districts and upcoming industrial
crore shares as against 41.22 crore equity nodes around Mayiladuthurai, enabling heavy
shares on offer, indicating a subscription of freight movement in the near future. The
1.20 times. Indian banks and FIs picked up railway link will pass just outside the port
39.75 crore shares worth around Rs 8,000 boundary, where a set of three railway sidings
crore. It witnessed poor response from the have been constructed. Karaikal Port has also
non-institutional and retail investors. constructed, at Nagore, a set of satellite
• India and New Zealand have started railway sidings, currently being used for the
negotiations for a Free Trade Agreement evacuation of cargo by rail.
(FTA) to expand further their relationship. • Konkan Railway Corporation Ltd (KRCL)
New Zealand, which exports coal, timber, and Balaji Infra Projects Ltd. (BIPL) have
wool and hides to India, exported goods signed a memorandum of understanding
worth $442 million last year, an increase of (MoU) for developing a 45 km rail-link
16 per cent, despite declining trade overall. connecting Dighi port near Chiplun in
Exports are projected to grow at 8 per cent in Maharashtra to the main Konkan rail route.
2010. India is now New Zealand’s 13th When rail siding is commissioned, it would
largest export destination. New Zealand had give Dighi Port the access to the central
FTAs with Singapore, Thailand China and hinterland of Maharashtra as also the northern
Malaysia. and southern hinterland of the State. This
MoU is the first of its kind to be executed
between KRCL and a port in Maharashtra.
KRCL being a part of this entire development
shall ensure smooth carriage of cargo to and profit of Rs 51.11 crore in the same quarter
fro the Dighi port under the Delhi Mumbai previous fiscal. Essar Shipping Ports and
Industrial Corridor (DMIC). Balaji Infra Logistics registered a 68 per cent rise in net
Project Ltd. has recently executed an MoU profit to Rs 21.8 crore from Rs 13.03 crore,
with Concor to establish the framework to which was mainly helped by long-term
facilitate the creation of logistic infrastructure contracts of their ships and strong contribution
and services for all the port users in the Dighi from ports and oil-fields business.
port. • Mormugao Port Trust (MPT) achieved the
• The fourth platform supply vessel delivered highest ever monthly cargo throughput of 6.34
by Cochin Shipyard Ltd for NFC Offshore million tonnes during January crossing its
GmbH KG, Germany, sailed off en route to earlier record of 5.95 mt, due to record
Singapore. Cochin Shipyard is currently quantity of 5.61 mt of iron ore exported. On
constructing 16 offshore vessels for various January 21, 2.82 lakh tonnes was handled
foreign and Indian owners. The vessel is surpassing the earlier daily record of 2.56 lakh
designed for satisfying the specific demands tonnes. Durinf the period period April, 2009 -
of transport of deck cargo, pipes, liquid cargo, January, 2010 the port had handled37.60 mt as
and cement/barite etc. and unloading to rigs compared to 31.90 mt handled during the
and production platforms, pipe laying barges corresponding period last year, surpassing the
etc. Ministry of Shipping’s target of 36.08 mt for
• IL&FS Maritime Infrastructure Company the port.
and Punj Lloyd Infrastructure; Vadinar Oil
Terminal, and Essar Ports and Terminals; ----- INTERNATIONAL -----
Mundra Port and SEZ and Adani Enterprises; • President Barack Obama sent the US
Simplex Infrastructures, SREI Infrastructure Congress a USD 3.83 trillion budget. The
Finance and Galfar Engineering and deficit for this year has rosen to USD 1.56
Contracting S.A.O.G; and Grup Maritim TCB trillion.
and West Coast Port. Are the shortlisted • US President Barack Obama has proposed
bidders for developing and operating a new a USD 3.2 billion assistance for Pakistan for
container terminal at the New Mangalore port fiscal 2011, in 2010 it has been USD 1.88
on a build-operate-transfer basis for 30 years. billion.
This terminalIt will have a four lakh TEU • Top Indian scientist Rajendra Pachauri has
container handling capacity. refused to apologise for a false claim made in
• Great Eastern Shipping, the largest fleet a landmark report by the UN climate change
owner in the private sector, has posted a 67per panel headed by him that Himalayan glaciers
cent dip in its net profit at Rs 94.3 crore could melt away by 2035, even as he admitted
against Rs 294 crore in the last year, while that the mistake had damaged the body’s
total income slipped 29 per cent to Rs 706 credibility.
crore from Rs 994 crore. Shipping • Iran president has announced that Iran was
Corporation of India also saw a 53 per cent ready for a swap of low enriched uranium for
dip with 87.44 crore against Rs 185.43 crore fuel for nuclear medicine.
last year. The state-owned company's income
from operations came down to Rs 845.43
crore from Rs 1,113.13 crore. Varun Shipping ----- NATIONAL -----
drifted into the negative territory, by posting a
net loss of Rs 1.38 crore compared with a net
• Meghalaya now has four leaders in the rank country’s emissions intensity. As such, the
of Chief Minister. The State government has target taken by India would not apply to the
elevated Pradesh Congress Committee agriculture sector.
president Friday Lyngdoh from the rank of • The first time after 20 years Indian Navy
Deputy Chief Minister — which he was will operate a nuclear submarine, Nerpa Akula
enjoying as political adviser to Chief Minister II, which has been taken on a ten-year lease
D.D. Lapang — to Chief Minister. The from Russia.The submarine will be especially
political leaders already enjoying the rank of useful for the Navy to train personnel given
Chief Minister are Dr. Lapang; the former that India is planning to induct its indigenous
Chief Minister, J.D. Rymbai, as Chairman of fleet of ‘Arihant’ nuclear submarines in the
the Meghalaya Economic Development coming decade. Unlike the Nerpa, which is an
Council; and another former Chief Minister, attack submarine and will not carry any
Donkupar Roy, as Chairman of the State nuclear tipped weapons on board, the Arihant
Planning Board. submarines will be fitted with nuclear capable
• The United Kingdom Border Agency to Submarine Launched Ballistic Missiles
suspended student visa applications at its (SLBMs).
centres in New Delhi, Chandigarh and • Government constituted a five-member
Jalandhar, due to exponential increase in the expert committee on Telangana issue headed
number of applicants. These centres received by former Supreme Court Judge B N
nearly 1,000 student visa applications between Srikrishna. The committee will hold wide-
October and December in 2007. The number ranging consultations with all sections of
increased to 1,800 during the same period in people and different political parties and
2008 and jumped to 13,500 during the groups in Andhra Pradesh.
corresponding period last year. This movewas • Statistics compiled by the Union Labour
welcomed by a leading overseas education Ministry show that Gujarat accounted for 55.9
consultancy as it will help to get rid of fake per cent of the total number of placements in
colleges and agents. 2006, which increased to 67.6 in 2007 and
• All the key countries, including India, stood at 64.5 per cent in 2008-09, nationwide.
China, US and the European Union, have Officials in the Labour Ministry said the
formally ‘associated’ themselves with the regular job fairs organized by the Gujarat
Copenhagen Accord and put on record the government in tandem with the industry
actions they intend to take to reduce bodies are one of the reasons for its success
greenhouse gas emissions, thereby completing story.
the first task towards a comprehensive global • The Clinical Establishments (Registration
agreement on climate change expected in and Regulation Act) Bill, 2010 — approved
Mexico at the end of this year.The letter that by the Union Cabinet last month — makes it
India has sent contains details of actions that mandatory for all clinical establishments to
India proposes to take on its own, in a non- provide medical care and treatment to stabilise
binding way, to bring down its emissions. In any person in an emergency condition.
an important exclusion, India has also clarified
that emissions from agriculture would be
exempt from being calculated to assess the
----- SPORTS -----
• Federer, who beat Britain's Andy Murray in the Australian Open men's final in straight sets on Sunday,
will begin his 268th week as the ATP's No 1 and match Jimmy Connors, currently in third place, for total
 number of weeks as world No 1. Pete Sampras leads the career list with 286 weeks at No 1, followed by
Ivan Lendl with 270.
• Australian middle-order batsman Michael Hussey took the top spot in the ICC ODI batsmen chart
updated last week, followed by Dhoni. Sachin Tendulkar and Sehwag are the other batsmen in top 10
lists.
• World champion and five-time winner Viswanathan Anand finished tied fourth in the 72nd Corus
chess tournament at Wijk aan Zee, near Amsterdam. Top seed Magnus Carlsen took the title with 8.5
points.
• West Zone created a world record in first class cricket by successfully chasing down a 536-run target
to clinch the Duleep Trophy with a three-wicket victory. Yusuf Pathan's double century helped the team
to chase such a big total. He scored 210.
• India leads the medals table with 57 gold, 28 silver and 14 bronze medals, in the South Asian Games
2010, being held in Dhaka.

Tatas- A Glance …
Compiled by Akilan

The Tata Group is a private conglomerate based in Mumbai, India. In terms of market capitalization and
revenues, Tata Group is the largest private corporate group in India. 65.8% of the ownership of Tata Group is
held in charitable trusts. The Tata Group comprises 114 companies and subsidiaries in seven business sectors
of steel, automobiles, information technology, communication, power, tea and hospitality. 27 of these
companies are publicly listed. The Tata Group has operations in more than 85 countries across six continents
and its companies export products and services to 80 nations. The company is now in the fifth generation of
stewardship with Ratan Tata as the current chairman.
Jamshetji Nusserwanji Tata founded the Tata Group. Jamsetji worked with his father till the age of 29. In
1868, he started a trading company with Rs. 21,000. In 1869, he acquired a bankrupt oil mill and converted it
into a cotton mill and renamed the mill to Alexandra Mill. He sold the mill two years later for a healthy profit.
Then he set up a cotton mill in Nagpur in 1874. He named it Empress Mill when Queen Victoria was
proclaimed Empress of India. He mainly wanted to implement four of his ideas- a steal company, a world
class learning institution, a high class hotel and a hydro electric plant. He laid the foundation for all of his
ideas, but only one idea came to reality during his lifetime- The Taj Mahal Hotel in Mumbai. The hotel was
completed for a sum of Rs. 4, 21,00,000 on 16 December 1903.
Jamsetji met Swami Vivekananda, when they were traveling in a ship to Chicago- where Swami Vivekananda
made his notable speech. Impressed by Vivekananda's views on science and leadership abilities, Tata wanted
to establish an institution under his guidance. Tata made all the ground work and the Indian Institute of
Science was incepted in 1909. The first Indian Director was the Nobel Laureate Sir C. V. Raman.
After the demise of Jamsetji, the group was led by Dorabji Tata, the elder son of Jamsetji. Dorabji learnt
business from his father . He had been with his father since 1884. Dorabji estabilished Tata Steel and Tata
Power companies. He turned the group with a cluster of 3 mills and a hotel to a largest private sector
establishment with a steel company, three electric companies and one of India’s leading insurance companies.
Tata Steel was established in Jamshedpur, and the place got the name after Jamsetji. Nowroji Saklatwala took
over as the chairman of Tata group after the death of Dorabji. He was the only non-Tata chairman of Tata
group.
JRD Tata became the chairman of Tata group in 1938, at the age of 34, after the death of Nowroji. JRD’s
father Ratanji Tata was the first cousin of Jamsetji Tata. Ratanji worked with Jamsetji and was one of the
partners of Tata Sons. JRD became one of the permanent directors of Tata Sons after his dad’s death in 1926.
JRD is the first man to get the commercial pilot license issued by India. He started Tata Aviation Service in
1929 which later became Tata Airlines and as it is called now- Air India. Under J R D's Chairmanship, the
number of companies in the Tata Group, grew from 15 to over 100. Monetarily, the assets of Tata group grew
from Rs 620 Million to over Rs 100 Billion. Few of the the more prominent of these ventures were Tata
Chemicals(1939), Tata Motors and Tata Industries(both 1945), Voltas(1954), Tata Tea(1962), Tata
Consultancy Services(1968) and Titan Industries (1984).
Ratan Tata became the chairman of the Tata Group in1991. Ratan is the great grandson of Jamsetji. Ratan
joined the Tata Group in 1962 with the Tata Steel. He proved himself as the Director-in-charge of Nelco in
1971, by making it acquire a market share of 20% from 2% earlier. Ratan is in the driver seat of Tata Group
and taking it to greater heights. Ratan set up Tata Teleservices in 1996 and acquired VSNL in 2002. His
recent achievements are acquiring Corus Steel in 2007 by Tata Steel and buying of Jaguar and Land Roverof
UK from Ford Motor Company. His dream was to launch a car that would cost Rs 1,00,000 and the Tata Nano
was announced in 2008, price of which is Rs 1,00,000.
Tatas divide their group’s growth into 3 categories- Foundation (1868-1931), Consolidation (1932-1989) and
Expansion (1990 onwards). Even sky is not the limit for Tatas.

BUSINESS LEADER OF THE WEEK

Lakshmi Niwas Mittal is an Indian-British steel magnate. He was born in Sadulpur village, in the
Churu district of Rajasthan, India on 15th june 1950. He began his career working in the family’s steelmaking
business in India, and has over 30 years of experience working in steel and related industries. Mittal founded
the company Mittal Steel (formerly the LNM Group) in 1976 and has been responsible for the development of
its businesses ever since. Such is the charisma of Mittal that his company is the world's largest producer of
steel. He also serves as a non-executive director of Goldman Sachs, EADS and ICICI Bank and is presently
the vice chairman of the World Steel Association.As of 2009, Mittal is the eighth richest person in the world.
He is also the richest person in the United Kingdom with personal wealth of US$19.3 billion or £10.8 billion
in 2009.
After splitting from his father and two younger brothers in 1994, took the international arm, with interests in
Indonesia and Trinidad and Tobago, while the rest of the family kept the domestic Indian business. In the last
few years Mittal Steel has made a number of acquisitions, buying up a network of steel producers in former
communist countries including Kazakhstan, Romania and Ukraine, and pushing into the U.S. in 2004 with the
$4.5 billion purchase of International Steel Group. Today, Mittal Steel is the only truly global steel producer
in the world with operations on 14 countries, spanning 4 continents.
His group is now diversifying into shipping, coal, power and oil enterprises. The most fascinating thing about
this man is that he is said to have a knack of buying sick and rusted steel companies and turning them into
gold!
Experts say that his capability to quote the cost of these sick companies make him winner all the way. His zeal
and fierceness for acquiring sick and closed steel plants is so intense that many times he has to jet from one
country to another, in quick succession, to sign another takeover deal. It is no surprise that he turns all of them
into gold. That's why the old saying, fortune favors the brave, applies to him in its entirety. Mittal, now owns
12 giant-sized steel plants that are part of a far-flung empire stretching from Canada to Trinidad & Tobago to
Kazakhstan and Indonesia.
Mittal pioneered the development of integrated mini-mills and the use of direct reduced iron or “DRI” as a scrap
substitute for steelmaking and led the consolidation process of the global steel industry. Mittal Steel is the largest
steelmaker in the world. Mittal was awarded Fortune magazine's “European Businessman of the Year 2004” and also
“Steelmaker of the Year” in 1996 by New Steel, and the “Willy Korf Steel Vision Award” in 1998, for outstanding
vision, entrepreneurship, leadership and success in global steel development from American Metal Market and
PaineWeber’s World Steel Dynamics. Mittal is an active philanthropist. Lakshmi Mittal is also known for his opulence.
In 2003, he acquired the Kensington mansion, said to be the world's most expensive home, from Formula One racing's
Bernie Ecclestone for £70 million ($128 million). His daughter Vanisha's $50 million wedding bash is touted as the
most expensive wedding of the 20th century.

FACT FILE
As on nov,09 Forbes’ Rich List, the combined wealth of
• Jim Walton (17.8bn$) the youngest son of Wal-Mart founder Sam Walton,
• Alice Walton( 17.6bn$ ) the daughter of Wal-mart founder,
• Christy Walton (17.6bn$) the wife of late John T. Walton, One of the sons of Sam
Walton &
• Robson Walton (17.6bn$) the eldest son of Sam Walton, founder of Wal-Mart

is more than that of bill gates’ (40 billion USD )who tops the billionaire’s list

Editorial Board
Editor: S.Akilan, MBA 2009-11 (ITL)

Sources: The Hindu, The Indian Express, The Times of India, Joint Editors: R.Jai Sangeetha...
The Economic Times,MBAThe2009-11(PSM), R.Satish
Business Line, TheKumar…MBA 2009-11 (ITL)
Financial Express
News Editors: Anubha Kumari, MBA 2009-11 (PSM), Arul, MBA 2009-11 (ITL), Ballai Ghosh, MBA 2009-11 (ITL Chandru, MBA 2009-11 (ITL), Ezhil, MBA 2009-11
(ITL), Gunjan Pathania, MBA 2009-11 (PSM), ManuPrakash, MBA 2009-11 (ITL), Moneesha, MBA 2009-11 (ITL), Nandha Kumar, MBA 2009-11 (ITL), Nison Samuel,
MBA 2009-11 (ITL), Prabhu, MBA 2009-11 (ITL), Riaz, MBA 2009-11 (ITL), Tapan Sahoo, MBA 2009-11 (ITL Thirunavukarasu, MBA 2009-11 (ITL), Vinoth Kumar,
MBA 2009-11 (PSM)

Proof Editors: Revathi…MBA 2009-11 (PSM), Ruthu Shree Ragavan…MBA 2009-11 (ITL)
Design Editors: Maneeventhan…MBA 2009-11 (ITL), Muthu kumaran…MBA 2009-11 (ITL)
Editor-in-Chief: Dr M. Sekar