Indian Share Market

We need a New Rupee for India

2013-08-23T13:41:00.000+05:30

R Jagannathan
Firstpost.com

Since everyone, and his aunt, is offering his or her two cents worth of advice and comment on the flailing rupee, here's mine: and it's worth one-and-a-half cents, not two cents.

Literally. At 65 to the US dollar, that's what the Indian rupee is worth right now. And this should engender new kinds of thinking about the rupee that is more optimistic.

First, the numbers.

At 1.53 cents to the rupee, clearly the dollar is the wrong unit to compare the currency with. We should now benckmark against the US cent. Seen this way, the rupee is stronger than the US currency by at least 50 percent. So cheer up.

Against the British pound today, the rupee is almost at par with our former colonial masters' currency. And remember, today the rupee is quoting at a very auspicious 101 to the pound. This is a sign that the gods are with us. So what if one rupee fetches slightly less than one pence today. At 0.99 pence to the rupee, the figure is even more auspicious. Remember: 101 and .99 are both lucky numbers.

Now, the yen. At 1.51 yen to the rupee, we are clearly the stronger currency when it comes to the Japanese currency. Sorry to do this to you Shinzo Abe, but Manmohanomics is leaving Abenomics in the dust.

Next, gold. But, hey, that's not currency, you will object. Sorry, chaps, gold is money, never mind that central banks don't like competition from the yellow metal. Guess what the price of gold was in 1950, the year India became a republic? Rs 99 per 10 gm (currently Rs 31,310 per 10 gm). That's a 316-fold-depreciation against the metal. To make the comparison more logical, we should thus state gold prices in multiples of 0.1 gm. We then get a nice affordable price of Rs 313 per unit of gold (0.1 percent). Even the NREGA wage earner can now afford gold. At Rs 313 for a spec of gold dust, we can hold our heads high. This is the aam aadmi route to inclusive currency policy.

We can, of course, go on and on showing how strong the rupee really is when viewed against the right unit of foreign currency or gold. The fundamental error the markets make is to benchmark us not against the right currency, but the wrong unit of any currency or gold.

But that brings us to the rupee when measured against it own former value. Since we started with the exchange rate of one rupee equals one pound sterling in 1947 , and the pound is now worth Rs 101, the rupee's own value can thus be deduced to be around one-hundredth of what it was in 1947. We will probably get worse results that is a rupee drop in value to less than a hundredth of its purchasing power in 1947 when we deflate the rupee by adjusting it for inflation .

Put simply, today's Re 1 is worth less than 1 paisa of 1947. Perhaps this is why parliament legislated a law in 2011 to allow the RBI to mint new Rs 1,000 coins coins, not notes.

Now, for the remedies.

To make the rupee more valuable, and to economise on printing notes or coins, it is best to let the current rupee die an unsung death. At 65 to the dollar, it is anyway close to retirement age . We should issue a New Rupee which is 100 times as valuable as the existing one.

The best way to upgrade the rupee is to redenominate it by decreeing that old Rs 100 = New Rupee 1. While currency in the bank will automatically be denominated in the new rupee, the currency with the public will have to be brought to banks to exchange for new Re 1 notes.

A side-benefit: those Pakis sending us fake currency notes will be left with a lot of unbankable notes. And so will our black money holders

Strong earthquake hits northeast Japan, tsunami warning issued

2012-12-07T14:16:00.001+05:30

Tokyo: A strong earthquake centred off the coast of northeastern Japan shook buildings as far as Tokyo and led to a tsunami warning for coastal areas of the northeast, public broadcaster NHK said on Friday.

The earthquake had a preliminary magnitude of 7.3, the US Geological Survey said. That was revised from an earlier estimate of 7.4.

A warning for a one metre tsunami was issued for the coast of Miyagi Prefecture in northeastern Japan, which was hit by a devastating earthquake and tsunami on March 11, 2011.

That quake triggered fuel-rod meltdowns at the Fukushima nuclear plant, causing radiation leakage, contamination of food and water and mass evacuations in the world's worst nuclear crisis since Chernobyl in 1986.

The government declared in December that the disaster was under control, but much of the area is still free of population.

Tokyo Electric Power Company, the operator of the Fukushima nuclear plant, reported no irregularities at its nuclear plants after the latest quake.

9 stocks that you can buy now: Expert tips

2012-11-29T10:31:00.003+05:30

Moneycontrol Bureau

Sentiments, across the global markets, have changed. There is a lot of optimism in the market now. The Indian market witnessed a strong rally on Tuesday. That rally is extended today.

Moneycontrol brings to you some of the recommendations given by experts that will help you cash in on the many opportunities available.

Stock picks for today:

Sudarshan Sukhani, s2analytics.com is bullish on Kotak Mahindra Bank . "It is now on the verge of a significant breakout on the upside. It is giving excellent signs of a strong uptrend. So, it is a buy. It is not an intraday buy necessarily," he elaborates.

HDIL has been Sukhani’s favourite. "A lot of the stocks are giving continuation patterns in an uptrend. That means HDIL rallied, it went into a sideways range and a sideways trade could go anyway. But, now, there are clear signs that the pattern, which it is developing, gives us another rally in the offering. So, we want to back HDIL today," he adds.

Sukhani has a 'buy' rating on Titan . "It rallied from Rs 210 to Rs 295. It is almost 45 percent in three months. We caught it when it moved up above Rs 230. Trends will always be discovered, once they start never at the beginning and since then Titan has been moving up. It has come in the buy list again and again as it has come today. It is making these new highs for this uptrend," he asserts.

Sukhani is also betting on Bajaj Auto . "It is a green chart. It rallied, made a small flag like formation. A flag comes midway in an uptrend and then it resumes its rally. It resumed it on Tuesday. I think there significant upside is left," he adds.

Also read: Nifty may see 6000 in December, says Sudarshan Sukhani

Multibagger ideas:

SP Tulsian, sptulsian.com has picked up CESC and Liberty Shoes as his multibaggers.

CESC, Tulsian says, is a good opportunity to buy it. "I am not giving a short-term view of five-six months. But if you keep a view of about one-year, they can look to a price of Rs 360," he adds.

According to Tulsian, Liberty Shoes looks quite good. "I feel that stock can move to Rs 140 in next one year or so," he asserts.

Brokerage read:

Stock: Jet Airways

Brokerage: Citi

Rating: Buy

Target: Rs 545

Rationale: The deal with Etihad will be skewed towards a fresh issue, which could result in fund infusion and reduce interest costs.

Stock: JP Power

Brokerage: Bank of America Merrill Lynch

Rating: Buy

Target: Rs 55

Rationale: JP Power is close to bagging the stage two forest clearance for a mine linked to its most profitable power projects. The stock could re-rate if it becomes free cash flow positive and the leverage situation improves.

Stock: Bharti Airtel

Brokerage: Nomura

Rating: Reduce

Target: Rs 290

Rationale: While there is a real potential for higher margins post the recent spectrum auction failure, the stock doesn't look cheap after the recent run.

Stock: GSK Consumer

Brokerage: Citi

Rating: Buy

Target: Rs 3,475

Rationale: Investors should tender in the offer and hold the remaining shares not accepted, as the stock may command a delisting premium from here-on.

Sensex tops 19,000; Eicher, Videocon lead midcaps

2012-11-29T10:27:00.001+05:30

Equity benchmarks built on their early gains, with the BSE Sensex now up close to 200 points at 19039. The December series of Nifty futures were quoting at a 40-point premium to the spot Nifty rate of 5780, indicating that traders were betting on the market to extend its rise next month.

Brokers said the upbeat mood could partly be due to reasons of sentiment rather than fundamentals.

"December is very kind to equities. Going back 32 years to 1980, December has produced a 4.6% median return with an 80% probabilitythe best for any month in the calendar," said a report by Morgan Stanley .

"Over the past 20 years, 1994, 2000, 2001 and 2011 are the only for occasions when December generated negative returns," the report said.

Realty, auto and FMCG shares are the big gainers in the first hour of trade. HDIL, Videocon and Eicher Motors were among the top gainers in the midcap space, up 4-5%.

Apollo Hospital was the biggest loser, down over 9% to Rs 792 on heavy volumes. Market talk is that CLSA has sold its 6.15% stake in the company at a discount to the market price.

Sensex gains strength as President Obama wins re-election

2012-11-07T11:47:00.001+05:30

Indian equity benchmarks gained strength following a win of Barack Obama as 44th President of the United States of America, but the US markets seem disappointed with these results as the Dow Jones futures lost 55 points.

The 30-share BSE Sensex gained 57.30 points at 18,874.68 and the 50-share NSE Nifty rose 17 points to 5,741.15. Even the Indian rupee was up by 31 paise to 54.12 against the US dollar.

Country's largest lenders State Bank of India and ICICI Bank topped the buying list, rising 1.35 percent each while housing finance company HDFC went up 0.75 percent.

Commercial vehicle maker Tata Motors extended gains to 1 percent ahead of second quarter numbers.

Technology majors saw buying interest following US elections outcome. Infosys, TCS and Wipro were up 0.4-0.8 percent.

Among metals stocks, Tata Steel, Hindalco Industries, Sterlite Industries and Jindal Steel climbed 1 percent each.

Index heavyweight Reliance Industries and private sector lender HDFC Bank slipped 0.2 percent, limiting the upside of market. FMCG major Hindustan Unilever fell 0.7 percent.

Private power producer Tata Power remained under pressure, losing over 1 percent following weak second quarter numbers.

In the second line shares, DB Realty, Apollo Hospital, Berger Paints,
Anant Raj Industries and J&K Bank rallied 3-6 percent while Chennai Petroleum, Tata Communications, Allcargo, Blue Circle and Era Infra Eng lost 1-3 percent.

Advancing shares outnumbered declining by a ratio of 1331 to 647 on the Bombay Stock Exchange.

Sensex gains 100 pts post Cabinet reshuffle; RIL, ITC lead

2012-10-29T10:15:00.000+05:30

Indian shares opened higher on Monday with the BSE Sensex gaining 100 points following the reshuffle of cabinet ministers yesterday. In the biggest reshuffle of the Congress-led United Progressive Alliance Cabinet, Manmohan Singh inducted 17 new faces and a total of 22 ministers giving several new and young faces a chance to prove their mettle as his government tries to remove the taint of scams and non-performance from its progress report.

Veerappa Moily received petroleum ministry while Ministry of State (MoS) (Independent) for Power has given to Jyotiraditya Scindia.

The 30-share BSE Sensex rose 114.41 points to 18,740 and the 50-share NSE Nifty went up 32 points to 5,696.25. But the rupee fell by 26 paise to 53.82 against the US dollar.Shares of Reliance Industries, Wipro, Dr Reddy's Labs, Hindalco, ITC, Tata Steel and Tata Power gained 1-1.5 percent.

Tata Motors, HDFC, HDFC Bank, Bharti, ICICI Bank, TCS, State Bank of India, ONGC and M&M were up. Hindustan Unilever shed another 0.3 percent following disappointing volume growth in Q2FY13.

Infosys, Sterlite Industries, Sun Pharma and PNB were under pressure. BHEL erased early gains immediately ahead of quarterly earnings today. The BSE Midcap Index rose 0.4 percent and Smallcap went up 0.6 percent. About two shares advanced for every share declining on the National Stock Exchange.

All UB group stocks caught in bear grip following a statement to Reuters by the promoter Vijay Mallya saying he would not sell priced assets to save Kingfisher Airlines. United Spirits tanked 5 percent and United Breweries Holdings lost 8 percent. United Breweries was down 4 percent. Kingfisher gained 5 percent Mallya is confident of licence suspension being revoked. "We will submit a robust revival plan to Directorate General of Civil Aviation," he said.

India Infoline was up 5 percent after strong numbers. Consolidated net profit jumped significantly to Rs 66 crore in the quarter ended September 2012 from Rs 22 crore in a year ago period. CESC bounced back with 2 percent gains after Friday's sharp fall. Firstsource Solutions gained 2.5 percent after good results. HCC, Yes Bank, IRB Infrastructure, GMR Infra, GVK Power, Sintex Industries, Chambal Fertiliser and LIC Housing Finance were up 1-2 percent.

BHEL Q2: Analysts expect margins to remain under pressure

2012-10-29T10:12:00.002+05:30

State-run power equipment manufacturer BHEL is set to announce its results for the quarter ended September 2012 today. Analysts on an average expect subdued revenues by the company due to sluggish order inflows.

Even margins are expected to remain under pressure due to increased pricing pressure and negative operating leverage, say analysts.

Profit after tax is likely to go up by 2.4 percent year-on-year to Rs 1,446 crore in the three months ended September 2012 and net sales are seen going up by 11.2 percent to Rs 11,448 crore from Rs 10,299 crore during the same period.

Earnings before interest, tax, depreciation and amortisation (EBITDA) is expected to go up by 12.7 percent YoY to Rs 1,930 crore in the second quarter.

Analysts feel the operating profit margin will rise by 20 basis points to 16.9 percent versus 16.6 percent YoY.

German company close to buy Orient Refractories; stk up 6%

2012-10-29T10:11:00.001+05:30

German company RH1 is close to buying Orient Refractories for Rs 550 crore, reports The Economic Times.

At 09:22 hrs Orient Refractories was quoting at Rs 38.60, up Rs 2.30, or 6.34%. It has touched a 52-week high of Rs 41.50.

It was trading with volumes of 8,650 shares. In the previous trading session, the share closed down 1.36% or Rs 0.50 at Rs 36.30.

The latest book value of the company is Rs 6.25 per share. At current value, the price-to-book value of the company was 6.18. The dividend yield of the company was 2.59%.

Kejriwal set for another revelation today; target-Gadkari?

2012-10-17T14:23:00.002+05:30

The man who took on Law Minister Salman Khurshid and Congress President Sonia Gandhi's son-in-law Robert Vadra, activist Arvind Kejriwal, is set to take centrestage again on Wednesday. Kejriwal had threatened to release proof of corruption by BJP President Nitin Gadkari. It now remains to be seen whether Gadkari will be his next target or it will be the NCP.

Kejriwal had also alleged that the Congress and the BJP were hand in glove with each other. "Why has the BJP not taken up the Salman Khurshid issue? Because both are hand in glove, they know we are going to expose Mr Gadkari now," Kejriwal had said.

Aiding Kejriwal in that promised expose, would be accompanied by Mumbai-based activist Anjali Damania, who first set the cat among the pigeons in September 2012, when she claimed that Gadkari and NCP chief Sharad Pawar were hand in glove with each other. "When I approached Mr Gadkari to raise the irrigation scam issue, he told me he could not help me because he and Pawar grant favours to each other," Damaniya had claimed.

CNN-IBN had earlier reported how the irrigation scam could potentially embarrass the BJP President. Documents accessed by CNN-IBN showed how close Gadkari aide and now party MP Ajay Sancheti had circumvented rules to get contracts from the Vidharbha Irrigation Development Corporation.

While corporation rules stated that no single firm can hold more than three contracts simultaneously, the Sancheti group bagged contracts FIRs in the name of Shaktikumar M Sancheti Ltd, then in the name of SMS infrastructure which was the same company with a new name, and also in joint ventures.
In the lower Penganga irrigation project that was controversially revived by Ajit Pawar just days ahead of the 2009 Assembly polls, Ajay Sancheti cornered more than one-third of the contracts. Gadkari wrote to the then water resources minister Pawan Kumar Bansal pushing for release of funds for the irrigation project, declared seriously flawed by the central water commission.

But Nitin Gadkari had remained defiant. In an interview to CNN-IBN, he even said that he will leave politics if anything against him was proved. On Wednesday, Arvind Kejriwal, who has so far gone public with charges against Vadra and Khurshid, is threatening to provide proof of alleged corruption that could embarrass the BJP chief.

M & M launches Rexton at Rs 17.67 lakh

2012-10-17T14:18:00.001+05:30

Auto major Mahindra & Mahindra today said it has launched a premium SUV 'Rexton' from the SsangYong stable.The first launch from its Korean arm is produced at the Chakan plant with some localisation, the company said.

In November 2010, Mahindra & Mahindra (M&M) had signed a definitive agreement with Ssangyong Motor Company to acquire 70 per cent stake in the ailing South Korean automaker at a total cost of USD 463 million (about Rs 2,105 crore).

"A manual model of the sports utility vehicle (SUV) is priced at Rs 17.67 lakh ex-Mumbai and the automatic version at Rs 19.67 lakh," M&M president, automotive and farm equipment, Pawan Goenka said at the launch.

The car is the first high-end SUV from the Mumbai-based auto firm. The company said it has invested over Rs 63 crore at its Chakan plant for this model.

Delhi government to give 3 extra subsidised cooking gas cylinders

2012-09-17T15:42:00.001+05:30

New Delhi: The Delhi government will give three subsidised cooking gas cylinder to the poor under its scheme to remove all kerosene stoves in the state. These will be in addition to the six subsidised cylinder limit announced by the central government on Friday.

The state government has undertaken a plan to remove all kerosene stoves used for cooking purposes. As part of this, it gives one cylinder and a stove free to families that use kerosene stoves. Now this scheme will extend to three subsidised LPG cylinders per family.

This will mean that each family will now get nine subsidised cylinders a year, beating the central government's cap of six. All cylinders above this cap will have to be bought at the market price, which is about Rs. 700. A subsidised cylinder costs Rs. 400.

The central government on Friday announced the limit in a bid to reduce its subsidy bill. But there are reports that this limit might be relaxed to overcome political opposition, specially from UPA ally Mamata Bannerjee.

CRR cut by 0.25 per cent, repo rate unchanged

2012-09-17T13:22:00.003+05:30

New Delhi: The Reserve Bank of India (RBI) on Monday cut the cash reserve ratio by 25 basis points to 4.5 per cent, increasing liquidity flow into the economy. However, it left the key bank rate and the repo rate unchanged, saying inflation risks as well as growth risks persist and the primary focus of monetary policy is fighting inflation, a move that many called conservative.

"In the current circumstances, lowering policy rates will only aggravate inflationary impulses without necessarily stimulating growth," RBI governor D. Subbarao wrote in the monetary policy review.

CRR cut by 0.25 per cent, repo rate unchanged

2012-09-17T11:14:00.000+05:30

New Delhi: The Reserve Bank of India (RBI) took the government’s reforms rendition a note higher today by cutting its key cash reserve ratio from 4.75 per cent to 4.5 per cent to increase liquidity flow into the economy.

The CRR stipulates the minimum proportion of deposits that banks must hold with the central bank. When the RBI increases the CRR, banks have fewer funds to lend or invest since they have to park more money with the RBI.

After the government announced a hike in the price of diesel and followed it up with some big-ticket reforms late last week, India Inc. has been clamoring for a rate cut from the central bank. Amid slowing growth and downgrades from global investment banks—some even threatening a downgrade to junk status—the RBI has steadfastly said controlling inflation is its key priority.

"Controlling inflation is the top most priority of the central bank," Chakrabarty told students of a city college in New Delhi on Friday, 14 September 2012, when inflation numbers for August were released by the government.

After falling a bit in the previous month, inflation rose to 7.55 per cent in August, driven by higher prices of potatoes, wheat and pulses which rose due to poor monsoons.

The spike in August's Wholesale Price Index was also driven by a rise in the prices of manufactured items, further whittling down the efforts of the monetary authority to batten down inflation.

Chakrabarty admitted that the nearly two-year-old rate hikes to combat inflation have had an impact on growth, driven by slowing investments. "We agree that investment has slowed down due to higher interest rate."

In its previous policy review end-July, the RBI left interest rates unchanged for the second time since June, in line with expectations, while cutting its growth forecast and lifting its inflation outlook as economic conditions deteriorated.

However, it cut the statutory liquidity ratio (SLR, the amount that commercial banks have to maintain in liquid assets, such as gold or cash) to 23 per cent from 24 per cent, effective August 11.

"In the current circumstances, lowering policy rates will only aggravate inflationary impulses without necessarily stimulating growth," RBI governor D. Subbarao wrote in the previous monetary policy review, adding the central bank's primary focus remains inflation control.

चंडीगढ़ : 26 लाख में खरीदा कार का पसंदीदा नंबर...

2012-08-10T16:53:00.001+05:30

चंडीगढ़: किसी कार का नंबर 0001 होना स्टेटस सिम्बल माना जाता रहा है, और पिछले एक-दो दशकों से लगभग सभी वाहन पंजीकरण विभाग कारों के इन फैन्सी रजिस्ट्रेशन नंबरों को प्रीमियम नंबरों के तौर पर बेचने लगे हैं... इस तरह नंबरों को बेचे जाने से विभागों, या यूं कहिए, राज्य सरकारों को काफी कमाई भी होती है, लेकिन चंडीगढ़ में हाल ही में पिछले सभी रिकॉर्ड तोड़ते हुए CH-01-AP सीरीज़ का वीआईपी रजिस्ट्रेशन नंबर 0001 नीलामी में 26 लाख रुपये में खरीदा गया है।

शहर के सेक्टर-44 में रहने वाले अमरजीत सिंह ने इस नंबर को अपनी मर्सिडीज़ कार के लिए खरीदा है, जबकि इसके लिए रिज़र्व प्राइस केवल 25 हज़ार रुपये था। अमरजीत सिंह ज़मींदार हैं, और पंजाब में ही खेती करवाया करते हैं।

चंडीगढ़ में इससे पहले जून महीने में भी एक व्यक्ति ने अपनी कार के लिए CH-01-AN सीरीज़ का 0001 नंबर 17 लाख रुपये की बोली लगाकर खरीदा था। इस माह में चंडीगढ़ के वाहन रजिस्ट्रेशन विभाग को बोली के जरिये बेचे गए नंबरों से 69 लाख रुपये की कमाई हुई है।

मुंबई में 9 मंज़िला इमारत में लगी आग

2012-08-09T18:10:00.002+05:30

मुंबई: मुंबई में एक नौ मंजिल इमारत में आग लग गई है। मौके पर दमकल विभाग की आठ गाड़ियां मौके पर पहुंच गई हैं। यह आग ताड़देव इलाके में स्थित एवरेस्ट बिल्डिंग में लगी है। यह आग करीब 5.30 बजे लगने की बात कही जा रही है।

बिल्डिंग सबसे ऊपरी मंजिल में आग लगी है।

Fire in residential building in South Mumbai

2012-08-09T18:08:00.000+05:30

Mumbai: The ninth floor of an apartment building in South Mumbai named the Everest is on fire.

Most residents have been evacuated. However, 12 people are reported to be trapped in the fire at the building.

The ground floor of the building has shops. Eight fire engines and eight water tankers are fighting the flames.

Govt to gift cellphones to poor families. Elections calling?

2012-08-08T11:24:00.001+05:30

New Delhi: The government is likely to spend Rs. 7,000 crore to provide a mobile phone to every family below the poverty line.

The scheme - titled Har Haath Mein Phone (in every hand, a phone) - will be announced on Independence Day in the PM's speech to the nation, said sources. Some newspaper reports state that six million families will get a phone and 200 free minutes.

The BJP described the freebie as a desperate attempt to seek favour among voters ahead of the general elections in 2014. "First, electricity should be provided to people in villages. Without electricity, what is the use of free mobile phones?" asked BJP leader Balbir Punj. "The government has not been able to implement any scheme without corruption," he added.

The cellphone scheme was allegedly conceived by the Planning Commission, whose parent is the Finance Ministry.

The world's worst power outages

2012-08-01T11:12:00.001+05:30

July 31, 2012: Three power grids across half of India fail in what authorities call overdrawing of the system, leaving a record 620 million people without power for several hours and raising serious concerns about whether the country's outdated infrastructure can meet soaring demands.

July 30, 2012: India's northern electricity grid fails for much of the day, leaving 370 million people without power.

Nov. 10, 2009: Storms near the Itaipu hydroelectric dam on the Paraguay-Brazil border are tentatively blamed for outages that cut power to as many as 60 million people in Brazil for two to three hours. The entire nation of Paraguay, population 7 million, is also briefly blacked out.

January-February 2008: Winter storms cause a nearly two-week blackout to about 4 million people around the central Chinese city of Chenzhou. Eleven technicians reportedly die trying to restore power.

November 2006: A German power company switches off a high voltage line over a river to let a cruise ship pass. It triggers outages for 10 million people in Germany, France, Italy and Spain.

Aug. 18, 2005: An imbalanced power grid kicks power plants offline in Indonesia leaves almost 100 million people in the dark, many for more than five hours.

July 12, 2004: Heavy use of air conditioners and other factors are blamed for blackouts affecting at least 7 million people in Greece just a month before the summer Olympic games.

Sept. 28, 2003: A short in a power line in Switzerland leads to blackouts affecting 95 percent of Italy. Some 55 million people are without power for as long as 18 hours.

Aug. 14, 2003: The worst U.S. blackout. Power line problems in the Midwest trigger a cascade of breakdowns that cut power to 50 million people in eight states and Canada, some for more than a day.

March 11, 1999: Lightning hits a power substation in Brazil's Sao Paulo state, leaving 97 million people without power for as long as five hours. An official says it is linked to transmission lines from the Itaipu dam.

March 1989: A solar geomagnetic storm knocks out power to 6 million people in the Canadian province of Quebec and parts of the U.S. for nine hours.

July 13, 1977: A lightning bolt knocks out electricity to about 8 million people in New York City. Power isn't fully restored until 25 hours later after widespread looting.

Nov. 9, 1965: The Great Blackout shakes Americans' faith in the power system. A faulty substation relay darkens New York City and thousands of square miles of the U.S. northeast for about 14 hours. Power is out for 25 million people. It inspires the popular film, Where Were You When the Lights Went Out?

Power crisis again: Northern, Eastern grids fail

2012-07-31T14:44:00.000+05:30

The Northern and Eastern Grids tripped today, leading to power failure in several states of the country affecting hundreds of millions of people.

While the Northern Grid collapsed for the second time in two days, the Eastern transmission lines too failed in the afternoon, said officials at the Power Ministry and electricity companies.

Power supply was disrupted in Delhi, Uttar Pradesh, Haryana, West Bengal, Assam and Punjab, among other states.

“Yes, I've heard that the Northern and Eastern grids have failed. We are looking into the matter. We are inquiring,” Power Minister Sushilkumar Shinde said.

The power crisis led to immediate shut-down of Delhi Metro lines in the national capital, while a host of other services including Railways were also affected.

“We are again having problems in Northern Grid,” K Soonee, CEO of Power System Operating Co (PSOC) said.

Power Ministry officials said Eastern Grid has also failed. The reasons for the grid failure were not immediately known.

While an almost 15-hour power crisis was seen in the Northern part yesterday, the crisis today reached the Eastern region as well.

Delhi government officials said the Northern Grid failed around 1.30 pm, when the national capital had a demand of around 4,000 MW. Only 38 MW was being supplied around 1.45 pm.

Again, Blackout. 12 states affected

2012-07-31T14:27:00.001+05:30

New Delhi: Power supply to as many as 12 states has been disrupted after the Northern and Eastern supply grids failed. The crisis was allegedly triggered after states like Rajasthan and UP drew much more than their assigned share of power. Sources say UP and Haryana over-drew by 1200 MW each, for example. The supply to Delhi ay 1.30 pm was reduced to an all-time low of 40 MW against its demand of 4000 MW.

Metro services on all six lines in Delhi have stopped. Upto 300 trains have reportedly been hit across the North. Shatabdis and Rajdhanis have been halted on their tracks.

100 MWs of emergency power is being provided to VVIP areas in the capital.

A massive outage yesterday - the worst in a decade - left 370 million people in seven states and Delhi without power for many hours. The crisis then was caused by a collapse of the Northern grid. Metro trains in Delhi yesterday were affected by that huge blackout, causing chaos during the morning rush hour. 500 passenger trains and 1.5 lakh people using them were affected by delays and cancellations.

Power Minister Sushil Kumar Shinde said yesterday that a three-member committee would determine the cause of the crisis. He refused to confirm whether the outage was caused by state like UP and Haryana drawing more than their allotted share of power.

Blast in Assam: Army vehicles targeted; one jawan killed, 7 injured

2012-07-31T13:31:00.001+05:30

Guwahati: At least one jawan was killed and seven others were injured in a high intensity blast in Assam's Goalpara district today.

According to sources, an improvised explosive device or an IED exploded under an army truck carrying soldiers from Kokrajhar to Agia in Goalpara at around 10:25 am. A Tata Sumo car travelling along with the truck was also targeted.

Banned outfit United Liberation Front of Asom or ULFA is said to be behind the blast.

RBI Credit Policy

2012-07-31T10:57:00.002+05:30

The Reserve Bank of India's (RBI) macro-economic report has painted a gloomy picture about the Indian economy. It has lowered the FY13 GDP forecast between 6.5 and 7.2% and has noted the upside risk to inflation.

Highlights of macro economic report:

Growth:

The growth picture is pretty dismal. If we did 5.3% in the previous quarter we are likely to do no better in the current quarter. The dangers to growth come even from the global side, which looks pretty bleak now.

Inflation:

The consumer price inflation remains very sticky at double digits. It is not likely to go down because monsoon is questionable at the current juncture. Globally, the harvest is bad and a lot of economies worldwide are stimulating growth through cutting interest rates. Therefore, that could push up commodity prices.

Current account deficit:

The third major factor the report points out is the current account deficit. At the moment, we can't afford 4.2% current account deficit of last year although crude oil prices are falling, service and software exports have fallen.

The RBI has also pointed out that the Nasscom forecast cannot be met. Therefore, in the current year even 2.5% of current account deficit looks difficult to sustain.

No interest rate cut by RBI?

The conclusion one can draw from all this looks like given the inflation expectation and the current account deficit dangers the RBI is unlikely to stimulate demand by cutting interest rate at this juncture.

It believes that the government has to do its bit in the first place by cutting fiscal deficit and using that extra money to stimulate investment so that growth is generated, only then can space be created for monetary policy.

What does the poll indicate?

The CNBC-TV18 poll indicates something very similar although it was taken before the macro economic report. Ninety percent of people who were polled said they don't expect a repo rate cut. Only 10% expect a 25 bps repo rate cut. As far as the CRR is concerned, 90% do not expect a CRR cut; 5% expect 50 bps and another 5% expect a 25 bps.

The more important point that the market will watch out for will be the growth forecast of RBI. The GDP forecast in April was put in at 7.3, 90% of people who were surveyed said that they expect the forecast to be brought down. Of this 90%, 45% said it will be between 6.5 and 7.2.

The other half said it will be below 6.5% that is 6-6.5%. Ten percent people said it will be brought down to between 5.5% and 6%. So, there are people who expect GDP to come at 5 point something in the current year.

A large majority expect RBI’s inflation target to be brought up. Fifty five percent said it will be unchanged, 45% said it can be raised to 6.5% to 7% and few said even above 7%.

Sixty percent expect RBI’s stance to remain unchanged. Fourty percent believe that RBI can adopt a slightly dovish stance in the policy.

RBI expected to keep rates unchanged

2012-07-31T10:55:00.001+05:30

The Reserve Bank of India (RBI) is expected to leave interest rates unchanged on Tuesday, seeing high inflation as a bigger danger than the slowest growth in almost a decade and keeping pressure on the government to revive the economy's fortunes.

Weaker-than-normal monsoon rains add to expectations that the RBI will keep its repo rate on hold at 8.00 per cent. High food prices resulting from poor rains may be beyond the reach of monetary policy, but they can add to inflationary expectations and tempt the government into spending more on subsidies.

Of 20 economists polled last week by Reuters, 19 expected the central bank to keep the repo rate unchanged.

After its mid-quarter policy review in June, roughly one-third of respondents had expected a July rate cut. Since then, RBI Governor Duvvuri Subbarao has voiced concern about high inflation, including for consumer prices, reinforcing expectations he will leave rates on hold.

Still, several market participants said the rapid deteriorating in the global economy as the euro zone debt crisis takes its toll suggested that the Indian central bank's decision may still be a close call.

"Over the past 6-8 weeks, the global situation has turned sharply adverse, and downside risks to the GDP growth projection have emerged. Upside risks to inflation seem limited at this juncture," said Hitendra Dave, head of global markets at HSBC in India.

On Monday, the RBI warned about a weakening growth outlook and upside risks to inflation in its quarterly review of the economy.

In June, wholesale price inflation rose to 7.25 per cent, while consumer price inflation hit 10.02 per cent. Wholesale prices are the main inflation gauge in India.

The RBI is also expected to leave the cash reserve ratio, the share of deposits that banks must keep with the RBI, unchanged at 4.75 per cent on Tuesday.

Indian stocks rallied on Monday, partly on hopes for a surprise rate cut, but debt markets remained cautious as benchmark 10-year bond yields rose slightly.

Subbarao has stressed the need for the government to reduce its fiscal deficit and improve the investment climate. He has said the central bank's 13 rate rises between March 2010 and October 2011, as it fought double digit inflation, were not the key reason for the slowdown in the economy, which grew at just 5.3 per cent in the March quarter, its weakest pace in 9 years.

The Indian central bank cut rates by a steeper-than-expected 50 basis points in April but has maintained a hawkish stance since, even in the face of widespread expectations in June it would cut rates again.

A continued hard line would make it an outlier compared with China, Brazil, South Korea and others, which have eased monetary policy in recent weeks to bolster their flagging economies.

The central bank has also been adamant that the government does its bit to boost the once high-flying economy.

It called on the government of Prime Minister Manmohan Singh to rein in spending on subsidies, but expectations that New Delhi may soon raise diesel prices to reduce its spending and borrowing burden and so alleviate pressure on market rates have been pushed back due to opposition from within the ruling coalition.

Singh spoke a month ago of reviving the economy's "animal spirit," but companies are still waiting for government measures, such as allowing foreign direct investment in supermarkets and airlines, to lift sentiment.

A study last week by Indian rating agency Crisil found that capital expenditure by 170 private-sector companies will fall by 35 percent on average in the fiscal year that ends in March.

New York's Plaza Hotel sold to Sahara for USD 570m

2012-07-31T09:53:00.000+05:30

Sahara Group has agreed to buy a controlling stake in New York's landmark Plaza Hotel for USD 570 million, Elad Properties, an Israeli-owned real estate company, said on Monday.

The 105-year-old luxury hotel overlooking New York's Central Park, is jointly owned by Elad Properties, an Israeli-owned real estate company, and Saudi-based Kingdom Holdings Co.

Elad, controlled by Israeli businessman Yitzhak Tshuva, said it would receive 1.6 billion shekels for its 60% stake, while Kingdom will receive the rest.

Kingdom, the investment vehicle of Saudi billionaire Prince Alwaleed bin Talal, will hold a 25% stake once the deal is completed, Elad said in a statement.

Elad said Fairmont Hotels & Resorts Inc, which has managed the hotel since 1999 and which is owned by the Saudi prince, will continue to operate the property.

Tshuva bought the hotel eight years ago for USD 675 million.

According to media reports, Elad had sold luxury apartments in the renovated hotel for USD 1.5 billion. The sale of the apartments alone netted Elad Group USD 500 million in profit.

USD 1=4.05 shekels

Heads roll after North India's worst blackout in 11 years

2012-07-31T09:51:00.001+05:30

New Delhi: Action has been taken against power officials in Uttar Pradesh for the massive blackout on Monday. Huge parts of North India spent Sunday night and much of Monday morning without any electricity. A fault near Agra, coupled with overdrawing of power by Uttar Pradesh, led to the blackout, which was the worst failure of the Northern Grid since 2001.

Following the massive power outage, over a dozen IAS officers have been transferred in Uttar Pradesh, including Avinash Awasthi, the chairman of the state-run Uttar Pradesh state Power Corporation. However, Mr Awasthi's future has been kept in abeyance; he has not been given a fresh posting. The power grid collapsed because some states apparently drew more power than they were authorised to do to meet the rising demand during the summer, Mr Awasthi had earlier said.
The crisis began at 2.30 am on Monday when the Northern power grid collapsed. Seven states including UP, Punjab, Haryana, and all of Delhi were plunged into darkness. 370 million people were affected - that's more than the population of the United States and Canada combined.
By the afternoon, 80 per cent of the power had been restored in Delhi. Power Minister Sushil Kumar Shinde said the last time the grid collapsed, in 2001, it took 16 hours to restore services. This time, he said, most services were back up within six hours. By the evening, the Northern Grid was completely restored.
The Northern grid was drawing power from the neighbouring Eastern and Western grids as well as getting hydroelectric power from the neighbouring mountain kingdom of Bhutan.
Around 1.5 lakh passengers in 300 trains suffered delays as the power grid failure crippled operations across eight divisions of the northern railway. 200 goods trains were cancelled. Rajdhanis and Shatabdis ran four to five hours late. In Delhi, the metro could not run during the morning rush hour, causing huge traffic jams as desperate commuters hit the roads instead. By 9 am, metro officials said the services were back to normal.
The Power Minister said a committee with three members will investigate what happened.
The international airport in Delhi was not affected by the power outage. "All our essential services like flight arrival and departure, check-in, baggage handling, aerobridge services were shifted to our back-up system. So all these operations remained normal", an airport spokesperson said. He, however, conceded that non-essential services could be hit.
The power deficit was worsened by a weak monsoon that lowered hydroelectric generation and kept temperatures higher, further increasing electricity usage as people seek to cool off.
Shivpal Singh Yadav, the power minister in the state of Uttar Pradesh, home to 200 million people, said that while demand during peak hours hits 11,000 megawatts, the state can only provide 9,000 megawatts.
Residents of Delhi are worried about their water supply being hit next. Delhi's six water treatment plants have been shut since power failed. All Delhi Jal Board water-pumping stations were affected. Power companies are giving priority to the Jal Board. Residents should be prepared for an erratic water supply till Tuesday morning.