Hyderabad Small & Large scale Industries updates

[Gudavalli]

NCC promoters up stake to avert takeover bids

HYDERABAD: The founders of NCC Ltd are raising their shareholding in the construction company, fearful of a hostile takeover attempt after the events surrounding another Hyderabad-based outfit IVRCL.

In three months, entities connected to the promoters of NCC have raised their holding in the company by 0.7% to 20.26% and plan to take it further to just under 25% so that they do not hit the open-offer threshold.

"The IVRCL-Essel Infra episode is one of the reasons. The second reason is that the market is down and the share price is low. We know the potential of the company and this is the time to increase our shareholding," executive director AGK Raju told ET.

In March and April, media baron Subhash Chandra's Essel group accumulated shares in IVRCL and openly expressed an interest in the infrastructure company. After back and forth exchanges, mainly through media statements, the Essel group said it would hold the line on its shareholding at 12.3%, topping the 11.2% ownership of founder Sudhir Reddy and his family.

Even though the promoters of NCC believe that a hostile acquisition of a construction company is not easy to pull off, Raju said he does not want to take chances. "It can be a headache. So, consolidation of stake is good."

NCC, founded in 1978 by AVS Raju, is now run by his sons. Its sales exceed 6,500 crore, but the market value of the company is only around 1,000 crore. Its share price has more than halved in the past 12 months to 40.

NCC is backed by private equity firms Blackstone and Warhol, which own nearly 10% each in the company, as well as investor Rakesh Jhunjhunwala. In late June, Jhunjhunwala's family bought a 0.29% stake in NCC in the open market to increase its holding to 7.98%.

The ownership level of the Raju family has halved over seven years as the company raised 1,475 crore by issuing fresh equity, said MV Srinivasa Murthy, NCC's senior vice-president in charge of legal affairs.

Nitin A Khandkar, founder of an institutional research company, said it makes "eminent sense" for the promoters to take the creeping acquisition route to consolidate their holding, particularly at a time when the company's financial performance has worsened.

In spite of a marginal revenue growth in 2011-12, the company's profits have fallen and the quality of earnings has declined with the rise of other income, he said.

[sriece19]

Hyderabad Industries can touch Rs 600: SP Tulsian

Tulsian told CNBC-TV18, "If you see the Q1 results of Hyderabad Industries there has been topline growth and margin expansion. For whole of FY12 the company had a PAT margin of close to about 7% on the topline of close to about Rs 860 crore and if you go by the present Q1 results, they have posted a topline of Rs 330 crore with PAT of Rs 33 crore. So that indicates PAT margin has improved from 7% to 10%."

He further added, "We have seen the volume growth also taking place by about maybe 20% plus on a comparable quarter of the previous year and for Q1 the EPS has resulted at about Rs 44. But I am not taking the same extrapolation, taking this Rs 45 as a benchmark that FY13 can result into an EPS of Rs 160-170 or Rs 180. On a conservative basis I have taken that to be anywhere between Rs 120-125 and the EPS which was at about Rs 81 for whole of FY12 and now EPS of Rs 44 for Q1."

"The company declared a dividend of Rs 18.50. So I am hopeful that this time the dividend payout is also likely to improve for FY13, which would be anywhere between 22-24 if you take the same dividend payout ratio of 25% to be maintained by the company which can also result into a yield of about 5% on the stock."

"So overall considering their strong presence in the roofing business for which they are providing the total solutions to the building, industrial structures and all that again this stock looks quite undervalued going by the expected EPS close to about Rs 125, ruling at a PE multiple of less than 4 and even the book value is close to about Rs 500. So taking all this into consideration I am expecting a price of Rs 600 in 12 months with a very minimal downside from here."

[sriece19]

HIL to launch green building products

HYDERABAD, JULY 25:
Roofing and building solutions provider Hyderabad Industries Limited is planning to come out with new green building products soon.

The company, part of the C.K. Birla Group, sees new opportunities in the green building sector. “We expect the new products to push our growth. We are backing this up with expansion of our distribution network,” Mr Abhaya Shankar, managing director of the company, said. The company is setting up distribution outlets in small cities and towns for market consolidation. As part of its diversification, it recently commissioned a 2.5 MW wind power unit in Rajasthan, taking its total installed capacity to 7.35 MW.

[sriece19]

IVRCL gets court nod for merger scheme




HYDERABAD, JULY 30:
The IVRCL Group firms have secured Andhra Pradesh High Court nod for composite scheme of merger.

The Court has sanctioned the Composite Scheme of Arrangement between IVRCL Ltd and IVRCL Assets & Holdings Ltd and two subsidiary companies of IVRCL — RIHIM Developers Pvt Ltd and IVRCL TLT Pvt Ltd.

This will be binding on their respective shareholders and secured creditors and employees of the company and all concerned. The effective date of the scheme is April 1, 2011.

The Chief Financial Officer of IVRCL, Mr R. Balarami Reddy, told Business Line that this move will help consolidate the infrastructure and construction business while providing the necessary liquidity for IVRCL AH shareholders post-merger. Shares of IVRCL AH will not be traded henceforth.

IVRCL shall issue five equity shares for every six equity shares held by the shareholders of IVRCL AH as on a record date to be fixed in consultation with the stock exchanges.

Consequent to the scheme, the real estate business of IVRCL AH shall stand demerged into a separate company RIHIM, which will be a 100 per cent subsidiary of IVRCL and the remaining undertaking of IVRCL AH stands merged with IVRCL.

IVRCL AH stands dissolved without being wound up. The Transmission Line Tower unit of IVRCL stands demerged as a separate 100 per cent subsidiary of IVRCL. The shares of Hyderabad-based infrastructure company IVRCL, which was in news earlier this year with the Subhash Chandra-promoted Essel group picking up stake, closed the day’s trade at Rs 44.75 up 5.67 per cent.

[Gudavalli]

Nagarjuna Construction net slips to Rs 20 cr in Q1, revenue up 12%

HYDERABAD, AUG. 9:
Nagarjuna Construction Company Ltd has recorded a lower net profit of Rs 20.10 crore for the first quarter ended June 30, 2012, as against Rs 31.81 crore it logged in the corresponding quarter last year. Its profitability was impacted by high interest costs, which put pressure on margins.

The turnover of the Hyderabad-based infrastructure company, on a consolidated basis, was up 12 per cent at Rs 1,816.52 crore against Rs 1,625.15 crore in the quarter under review.

The company's earnings before interest, taxes, depreciation and amortisation stood at Rs 204.14 crore for the first quarter as against Rs 343.08 crore in the same period last year. It posted a lower EPS of Rs 0.79 in the first quarter as against Rs 1.22 in the corresponding quarter of the previous year.

On a standalone basis, the company achieved a turnover of Rs 1,495.55 crore (including other income) in the first quarter this year as against Rs 1,166.45 crore in the corresponding quarter of the previous year, registering a growth of 28 per cent.

The net profit for the first quarter was lower at Rs 16.61 crore as against Rs 23.28 crore reported during the same period of the previous year.

During the first quarter this year, the company has so far secured orders aggregating Rs 2,001 crore, taking the order book to Rs 20,520 crore as at the end of the quarter.

The company’s shares closed the day at Rs 39.15, up 1.69 per cent.

[Gudavalli]

Mediciti Group appoints former AAPI president Dr. C. Ventata Ram as new CEO

Hyderabad: Dr. C. Venkata S. Ram, an internationally recognized educator and respected authority in the field of hypertension, is the new CEO and president of Mediciti Group of Institutions, Hyderabad, India. The Mediciti group of Institutions has one medical college, two hospitals, postgraduate education (MD/MS) in 20 specialties, clinical research facilities, and two nursing colleges.

Dr. Ram served on the faculty for a number of years as a professor of medicine at the prestigious and highly acclaimed University of Texas Southwestern Medical School in Dallas, Texas. He was also the director of the Texas Blood Pressure Institute and the director of Medical Education at the Dallas Nephrology Associates. A uniquely skilled communicator, he introduced a popular “Health letter” to reach out to and communicate with the primary care physicians.

He also had the honor of discussing the public health policies with the former Prime Ministers of India — P.V. Narasimha Rao, Atal Behari Vajapayee and Deve Gowda. Dr. Ram as the president of AAPI also had the honor of introducing AAPI and its mission to President of the United States – Bill Clinton.

Dr. Ram is the current vice president of the American Society of Hypertension Specialists. He authored 310 publications and wrote a book on Hypertension. He was repeatedly recognized as one of the Best Doctors in America. He is rated as a top class clinician and teacher. He received the Mother India award. He was recognized as the “best globally know physician” by TANA from the Andhra Pradesh. He has several other honors and awards to his credit.

[Gudavalli]

Ybrant: Buzzing in digital marketing space

The Bay Area or Silicon Valley in the mid-1990s was buzzing with ideas and funds were chasing them. An ideal setting indeed for Suresh Reddy to turn entrepreneur and take risks. Suresh and his school buddy Vijay Kancharla got together and hit upon the idea to start USAgreetings.com.

“We got into design and distribution of greeting cards through the Web. Put our personal money of a crore and got on to the bandwagon of entrepreneurship. By 2000, with the dotcom bust, we also crashed. But we did not lose heart,” recalls Suresh Reddy, now Chief Executive of Ybrant Digital, a rapidly growing company in the Internet technologies space.

A big learning from the first venture was clear. “We need to give people what they want.” The two were shocked when they heard a top entrepreneur in the Valley told them “buddy you are trying to sell greeting cards when people are being laid off in big numbers.” At that time Suresh and his friend’s company employed 15 people in San Francisco and 50 in Hyderabad. “We did not lay off, but gave a gradual exit plan and retention option if we did well,” he says.

In 2001, Suresh returned to India after over 10 years in the US, where he pursued higher studies, worked in several companies and took his baby steps as an entrepreneur. He changed tracks, re-launched the greetings business in a new avatar called Ybrant Technologies in Hyderabad. Till 2004, says Suresh, they ran the company with their own resources and with the revenues they managed to pay up their debts.

The hunger for growth began around 2006 with Ybrant Digital, the digital marketing services provider going in for its initial acquisition – the Isreali firm Oridian and the Serbia-based Seenietix. With $20-million PE fund from Sansar Capital and funds raised through financial institutions, Ybrant bought up around half a dozen more companies in the next few years. In a short time, Ybrant has spread itself into different geographies and is present in 16 countries, with over 500 employees.

“I never thought I will fail. I went with blind faith and belief, both when I started my journey as an entrepreneur in the US and when I came back to India to start Ybrant. I can’t say whether it is self-confidence, but more akin to refusal to give up that has brought me thus far,” says the 46-year-old Suresh.

The journey took another turn in 2012, with Ybrant going in for a merger with LGS Global. The merged entity will emerge as an over Rs 1,000 crore revenue company. It has gone in for a listing on the BSE and is going through the merger pangs.

The company is concentrating on building products internally in the digital advertising and marketing space, even as it looks at buying up companies in India and abroad.

Social media and mobile will be the key focus areas. The markets in Asia and Latin America offer big growth prospects. In other countries too, Ybrant is present and growing. “We do around 30 billion impressions per month. Want to stick to digital media for now.”

BACKGROUND

Suresh is a first generation entrepreneur. His grandparents were into farming, while his father was in the civilian side of the Defence services. Suresh is a Mechanical Engineer from IIT, Kharagpur and studied MS in Engineering Mechanics from Iowa State. After completing his postgraduation, he worked in a number of companies starting as a project engineer with AM General Corporation, Detroit which makes the Hummer and went on to do a stint with Charles Schwabe.

The longest work experience he had was with the Caterpillar Group. That was for two and half years. Then, he moved to Detroit and worked with Chrysler’s Jeep and Truck Group. The rolling stone that he was gathered quite a good chunk of moss, that today keeps him in good stead while dealing with people, geographies and challenges.

To be a successful entrepreneur one has to have passion and persistence. “I did not give up when our first venture floundered or when my father asked me why are you giving away free greeting cards. I persisted, learnt from failures and improved,” says Suresh.

In areas of innovation there is money today. But to go raise the funds is challenging. Convincing the investor is tough. Around 2000, getting finance from banks and financial institutions was difficult, but it has changed now. The Indian consumer base is large. If you get right ideas, investors are ready. “A good age to take the plunge if you want to be an entrepreneur is early 30s. I started at 32,” is Suresh’s sage advice to aspiring ones.

VISION AND GOALS

Asked about his vision and goals for Ybrant, Suresh says he does not believe in mission statements or targets for growth. The digital space is highly unpredictable.

“I never imagined that the market would grow like this. There could be quantum jumps. I am also not thinking of diversification. Sticking to core strengths is the best strategy now for us.”

Spending time with a close knit group of friends, bonding with family and hectic business travel is Suresh’s typical lifestyle. Suresh believes in Tao’ism.

For him, running large organisations is like cooking fish, perhaps easy. Smaller organisations pose challenges, running multiple companies in different geographies with varying cultures is still tougher. He says he believes in least interference and allowing growth of local leadership to drive the growth.

He has learnt leadership skills hands on, with failures and successes. An entrepreneur should be ready to learn on a continuous basis, he says. Building the brand ‘Ybrant’ is the key motivation for him, he sums up.

[Gudavalli]

Accel Partners Invests In Mind Edutainment

Mind Edutainment Private Limited has raised R2.7 Cr from Accel Partners and group of angels led by Meena Ganesh - CEO & MD Pearson Education.

The funds raised will be used to scale the initial pilot project of THOTS Lab from 3 cities to 8 cities and to integrate ICT in delivery process to create an ideal mix of ICT and Experiential Learning.

Earlier, the company had received funding from the Department of Science and Technology and individual angel investors.

Founded in 2007 by Sangeeta Khurana and Ashutosh Khurana, Mind Edutainment develops and provides solutions to improve social and emotional thinking skills among school-going children.


The company has developed 'Higher Order Thinking Skills' program with the use of physical Thinking Tools and Mind Games. The program created has been adopted by 40 plus schools and 50000 plus students of UKG to Grade VIII as a complete subject on thinking skills development.

It provides services to schools in Karnataka, Tamil Nadu, Uttaranchal, Chandigarh and Delhi NCR.

The company has created 'THOTS Labs' , a scientifically designed space in the school with focus on thinking development right from the age of four through experiential learning and structured simulations within the school environment.

Mind Edutainment plans to install THOTS Lab across Delhi, Dehradun, Chandigarh, Bangalore, Hyderabad, Chennai, Kochi & Pune.

Earlier in August, Accel Partner invested $5 Mn in Universal Collectabillia, a celebrity merchandise and brand extension firm. It also invested in ZopNow Retail, an online hypermarket for groceries & related goods.

Recently, LIQVID, an integrated eLearning content solutions company specializing in English Language Training, raised $3 Mn funding from SBI Ven Capital, a subsidiary of SBI Holdings, Japan. The IIT Bombay incubated – Inopen Technologies Private Limited was planning to raise $4 Mn for expansion. Hyderabad based Kindle Experiential Learning which offers innovative learning solutions for schools under the brand Creya Learning was also planning to raise around $4.5 Mn - 5 Mn.

[Gudavalli]

Marginal fall in Madhucon’s net

HYDERABAD, AUG. 12:
Madhucon Projects Limited has posted a lower net profit of Rs 7.02 crore for the first quarter ended June 30, 2012 as against Rs. 7.96 crore it logged for the corresponding quarter last year.

The company’s revenue for the first quarter was, however, up by 2 per cent at Rs 336.15 crore (Rs 329.22 crore).

The Hyderabad-based infrastructure company, which is into EPC contracts, road development through its subsidiary Madhucon Infra Limited, and executing thermal power project through another subsidiary Simhapuri Energy Private Limited, currently has an order book of Rs 6,300 crore.

It is prequalified for EPC works of over Rs 20,000 crore in irrigation, highways and other sectors.

COAL PRODUCTION

PT Madhucon Indonesia, a subsidiary of company with rights for three coal assets in Indonesia, has commenced production in one of the mines at Dewas located in Sumatra. This mine has a monthly target of 20,000 tonnes.

During the quarter, the company commissioned phase I of 300 MW of the 1,920-MW Simhapuri power plant coming up in Nellore district of Andhra Pradesh.

Two more units of 150 MW each are likely to be commissioned during the year, taking the installed capacity to 600 MW.

[Gudavalli]

Infotech Enterprises eyes control of JV with Pratt & Whitney

HYDERABAD: IT services firm Infotech Enterprises plans to buy majority stake in its aerospace engineering joint venture with American aircraft engine maker Pratt & Whitney. Indian mid-tier IT services company, tracking $400 million revenue, wants to broadbased the aerospace business which is mostly dependent on the US partner.

Pratt & Whitney, a unit of the US defence giant United Technologies Corporation (UTC), currently holds 51% stake in the Puerto Ricobased Infotech Aerospace Services. Infotech Enterprises , backed by private equity firms Carlyle and General Atlantic Partners, is likely to take 74% controlling interest in a bid to win more business from new aerospace clients.

UTC arm will keep at least 26% stake in the eight year-old JV with 700 staff and more than $75 million revenue.
"We have plans to take majority ownership in this joint venture. It will essentially make way for more business from other aerospace clients which considered majority stake of United Technologies a hurdle in giving us business," Infotech Enterprises chairman & managing director B V R Mohan Reddy told TOI.

The move signals Infotech's intent to scale up aerospace engineering services unit at a time when IT companies hope to ride on the offset clauses coming along with India's big defence orders to global aerospace biggies.

The JV works on aerospace engineering and software development for military, commercial and industrial applications. Infotech and UTC began a strong association in aerospace almost a decade ago with the latter taking majority ownership of Puerto Rico operations, since near-shoring work there was seen strategic to US national interests. The JV management will remain intact despite a possible ownership change given the continued nature of work.

The ties between UTC with Infotech are bolstered by the former's little over 13% stake in one of India's fastest growing mid-tier IT services companies. Infotech is primarily an engineering services company focused from aerospace, automotive, energy, heavy equipment, consumer, healthcare and telecom verticals. Infotech Enterprises stock ended Monday trading marginally down at Rs 175 on BSE.

[Gudavalli]

Gayatri Projects net falls to Rs 8 cr in Q1

HYDERABAD, AUG. 14:
Gayatri Projects Ltd has posted a lower net profit of Rs 8.02 crore for the first quarter ended June 30, 2012, as against Rs 16.73 crore it registered in the corresponding quarter last year.

The Hyderabad-based company’s revenue was marginally up at Rs 404.21 crore as against Rs 401.43 crore in the period under review.

The board has approved a proposal to acquire shares in an overseas joint venture company subject to getting the nod from members in the forthcoming annual general meeting.

The company management has approved a new logo and brand guidelines for the Gayatri Group to be implemented from August 20, 2012.

Gayatri Projects’ shares were quoting at Rs 100, up 1 per cent during the day’s trade.

[Gudavalli]

IL&FS Engineering posts Rs 34-cr loss in Q1

HYDERABAD, AUG 14:
Hyderabad, Aug 14 IL&FS Engineering and Construction Company Ltd (formerly Maytas Infra Ltd) has posted a loss of Rs 34.22 crore for the first quarter ended June 30, 2012 against a loss of Rs 14.10 crore in the corresponding quarter last year.

However, the revenues stood at Rs 359.41 crore against Rs 250.88 crore.

The board has decided to extend the financial year of the company by six months. This move comes in the wake of the Scheme of Arrangement undertaken by the company to restructure its capital.

The capital restructure process is awaiting the approval of Andhra Pradesh High Court.

In the Limited Review Report, Auditors S.R.Batliboi & Associates have carried forward certain qualifications including inter corporate deposits of Rs 343.78 crore.

The company shares were quoting flat at Rs 51 during the day’s trade.

[Gudavalli]

YBrant's net up at Rs 60 cr in June quarter

Hyderabad, Aug 14 (PTI) City-based digital marketing company Ybrant Digital Limited (formerly LGS Global Limited) today said its net profit for the quarter ended June 30 registered at Rs 60 crore against Rs 44 crore during the same period previous year. Net profit was up by 36 per cent mainly on account of forex gains during the quarter. The company gained nearly 13 crore on rupee depreciation against foreign currencies. Revenues for the quarter stood at Rs 381 crore against Rs 272 crore in the same period last fiscal, Ybrant said in release issued here. Ybrant has two core segments - digital marketing and software development. Its shares are traded at Rs 82 apiece on Bombay Stock Exchange, up 2.63 per cent in the afternoon trade.

[Gudavalli]

Megasoft revenues, profits down in Q2

HYDERABAD, AUG 14:
Revenues and profits of Megasoft have declined in the second quarter and also in the first half of the financial year.

In the quarter ended June 30, 2012 the revenues dipped to Rs 29 crore against Rs 40 crore in the same quarter last year. Net profit too fell to Rs 1.25 crore from Rs 5.31 crore.

“Decline in revenue is because of loss of one of the largest clients in 2011 which had its first full impact in the first half of 2012. But we have closed two new deals in the second quarter with multi-year revenue potential,’’ G.V. Kumar, Managing Director of Megasoft, has said.

He said the company has implemented cost-control measures and expects some ‘positive’ impact in EBIDTA (earnings before interest, depreciation, taxes and amortisation) in the second half of 2012.

“The first half has been a tough one on the operations of the company. While the company managed to stay operationally cash and profit positive, capex spending is witnessing a slowdown, resulting in slower uptake for the company’s new products and applications,’’ he said, commenting on the results.

For the first half, the Hyderabad-based company reported lower revenues of Rs 59 crore (Rs 80 crore) and a net profit of Rs 4 crore (Rs 12 crore).

[Gudavalli]

Vivimed Labs consolidated net sales zooms by over 126% in Q1

Vivimed Labs, a Hyderabad based Rs.650 crore pharmaceuticals and specialty chemical major, has posted excellent performance during the first quarter ended June 2012. Its consolidated net profit increased sharply by 111 per cent to Rs.26.13 crore from Rs.12.39 crore in the corresponding period of last year. Its consolidated net sales also increased by 126 per cent to Rs.272.52 crore from Rs.120.64 crore. Its earnings per share touched to Rs.18.75 from Rs.12.19 in the last period.

The sales of speciality chemicals business improved marginally by 2.6 per cent to Rs.105.17 crore. Its pharmaceutical sales have taken sharp jump and touched Rs.190.84 crore from Rs.37.79 crore. The pharma division's profit before tax and interest increased to Rs.28.11 crore from Rs.7.02 crore and that of speciality division improved by Rs.19.70 crore from Rs 15.04 crore.

However, its standalone net sales declined by 12.3 per cent to Rs.91.16 crore from Rs.103.93 crore in the similar period of last year. Its standalone net profit moved down by 21.8 per cent to Rs.8.45 crore from Rs.10.80 crore.

[Gudavalli]

NMDC posts Rs 1,906 cr net profit in Q1

HYDERABAD, AUG 13:
NMDC has posted a record net profit of Rs 1,906 crore during the first quarter ended June 30, 2012 a six per cent growth compared with Rs 1,801 crore in the same quarter last year.

The iron ore major has achieved a turnover of Rs 2,840 crore (Rs 2,782 crore), a marginal increase over the comparative quarter. The earnings per share stood at Rs 4.81 compared with Rs 4.54 per share last year.

During the quarter under review, production of iron ore jumped 12 per cent to 6.9 million tonnes while the sales stood at 6.2 mt, almost on par with the corresponding quarter of the previous year.

For the year 2012-13, a capital expenditure of Rs 4,656 crore is planned to be incurred including Rs 1,200 crore for overseas acquisitions, a press release from the Hyderabad-based public sector undertaking said.

The board of directors of NMDC had met under the chairmanship of C.S. Verma on Monday.

Verma said: “NMDC would be recognised not only as an iron ore mining major but also as a key enabler of the steel and infrastructure industry”.

The installation of 3 MTPA steel plant at Nagarnar in Chhattisgarh, as part of NMDC’s forward integration programme and value-addition, is being pursued vigorously.

Orders for major packages worth Rs 12,842 crore have already been placed while other auxiliary packages are in advanced stages of finalisation, he said.

[Gudavalli]

AP Incubators plans Rs 14-cr emu oil unit

AP Incubators Private Limited, a Hyderabad-based manufacturer and exporter of poultry incubators and equipment, is planning to set up the country’s first emu fat and oil processing plant on the city outskirts with an investment of Rs 14 crore, according to managing director N Srinivas Chowdary.

The plant, to be set up under the company’s new subsidiary AP Emu Processors on 10 acre, will have an initial capacity to process 600 kg of frozen emu fat into refined oil and soap stock per day.

“A three-year exclusive contract with Pennsylvania-based Bulk Emu Oil is already in place, and we will start exporting the US FDA and American Emu Association-approved emu oil to them once the processing unit is completed in 10 months from now,” Chowdary told mediapersons on Tuesday.
The company, he said, had plans to establish an emu slaughter house and meat processing unit in the city, expected to be ready for commercial production in the next three years. A majority of the proposed investment would be funded through bank loans and the remaining through internal accruals, he added.

According to SK Maini, partner, AP Emu Processors, Andhra Pradesh leads the country in emu farming with approximately 3,500 farmers and a bird population of 800,000, closely followed by Tamil Nadu, Maharashtra, Punjab, Haryana, Karnataka and Gujarat. The total emu population in India is estimated to be 1.4 million.

“Though there is significant demand for emu meat and other products, the Indian emu industry on Tuesday is suffering due to lack of slaughter and fat processing facilities. Our idea is to promote satellite slaughter units in several emu-producing states. We are already working closely with various universities for R&D on breeder birds for meat, and with the cosmetic industry for emu oil-based skincare and healthcare products. We will start exporting these products after three years from now,” he said.

[Gudavalli]

Future Capital promoters to absorb Rs 170-cr loan given to Deccan Chronicle

DCHL extends financial year by 6 months

HYDERABAD, AUG. 3:
The Promoter Group of Future Capital Holdings Ltd has agreed to takeover the entire loan exposure of Rs 170 crore lent to Deccan Chronicle Holdings Ltd and Aviotech Ltd.

About 56.3 per cent of Future Capital is owned by Pantaloon Retail (India) Ltd and Kishore Biyani. Warburg Pincus has also become a shareholder in the company after they had decided to buy stake in Future Capital for Rs 560 crore.

In a statement to the stock exchange, Future Capital has informed that the board of directors of the company reviewed the loans given to Deccan Chronicle Holdings. To safeguard the interest of the stakeholders of the company, the Promoter Group of Future capital has agreed to takeover the entire loan exposure at book value.

With this development, Future Capital will cease to have any exposure in Deccan Chronicle Group. The promoter group intends to take all action necessary to safeguard all its entitlements and rights after this assignment.

Last week, Deccan Chronicle had informed that about 54 per cent of their stake has been pledged with Future Capital to raise funds.

However, there continue to be a series of developments, including a winding up petition by IFCI and a complaint of forgery by Karvy.

Financial year extended: Deccan Chronicle has informed that the financial year of the company ended on March 31, 2012 has been extended for a further period of six months ending September 30, 2012, with the approval of the Registrar of Companies.

Referring to media reports, “DB Corp in talks to acquire DCHL print biz,” Deccan Chronicle Holdings Ltd has clarified that the company has not been approached by anybody to acquire the print business and the company and is no way connected with the news.”

Meanwhile, DCHL has witnessed several bulk deals including Vora Financial Services Private Ltd.

The DCHL shares closed the day at Rs. 13.55 up 1.88 per cent.

The Hindu Business Line competes with Financial Chronicle.

[Gudavalli]

Lanco Infra to raise Rs. 2,000 cr by March via stake sale

Hyderabad: Lanco Infratech Ltd, India’s largest independent power producer, will sell shares to raise Rs.2,000 crore by March to reduce debt and invest in ongoing projects.

Lanco has borrowed Rs.33,118.6 crore and interest costs shot up 77% to Rs.539 crore on 30 June compared with Rs.304 crore a year earlier.

The firm had appointed Macquarie Capital Advisers, a Macquarie Group advisory, to find a strategic investor into its power and solar power businesses. In power, the company is trying to offload stakes in both thermal and hydropower at the project level.

With the proposed divestment, the high debt to equity ratio of 4.38 is likely to drop to 4, according to T. Adi Babu, chief operating officer of finance and financial controller of Lanco Infratech.

The loss came on an 87% increase in revenue to Rs.3,495.7 crore in the June quarter. Photo: Mint
Lanco has installed capacity to produce 4,110MW of electricity, out of which around 73% is thermal and 26% gas-based, while hydropower accounts for a little over 1%.
The company is also looking to unlock value from its non-core businesses such as roads, wind power and real estate.

The road portfolio of Lanco consists of three build, operate and transfer projects of about 440km, of which two projects are operational and another is still under construction.

The company is developing a residential-cum-commercial and information technology (IT) park near Gachibowli, the information technology hub of Hyderabad. Consultancy Ernst and Young had been given the mandate to look for investors into the roads and real estate segments.

There is a “lot of interest” but investors are seeking “clarity on policy level issues such as sectorial reforms to electric utilities, liquidity issues, tariff revision issues and funding issues by banks,” Babu said.

Analysts are not too sure about the company’s ability to raise money in the current circumstances.

“It’s impossible,” said Vijaykumar Bupathy, senior analyst with Chennai-based Spark Capital Advisors (India) Pvt. Ltd. “Given the poor Q1 results, which were way below our expectations, it becomes even tougher for the company to raise capital.”

Lanco reported a consolidated net loss of Rs.441.2 crore in the quarter ended 30 June. It cited high interest costs, foreign exchange loss and lower capacity utilization at some of its power plants as reasons behind the lacklustre performance.

The company had posted a profit of Rs.13.8 crore a year ago. The loss came on an 87% increase in revenue to Rs.3,495.7 crore from Rs.1,867.2 crore in the previous year.

Lanco said it had incurred a forex loss of Rs.230.2 crore in the first quarter. Interest costs rose by 77% to Rs.539 crore from Rs.304 crore a year ago.

The company’s power business, which contributes about half of its total revenue, grew by 94% to Rs.2,081.6 crore. The operating capacity of its power business is 3,324MW. Average plant load factor (PLF), an indicator of a power plant’s capacity utilization, was 58%.

Lanco, which planned to increase 5,000 MW capacity in its power business, has put on hold the expansion plans owing high interests costs and a fuel shortage.

In the first quarter, Lanco had commissioned the 70MW Budhil hydropower project in Himachal Pradesh. The company said the project achieved a PLF of 53%.

Its engineering, procurement and construction business revenue fell to Rs.1,573.4 crore from Rs.1,736.9 crore a year ago. The construction business has an order book of Rs.2,509.5 crore, of which 78% constitutes Lanco’s internal projects.

Property development revenue declined to Rs.7.11 crore from Rs.34.7 crore a year ago.

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Rs 10-cr emu processing unit to come up in Medak

HYDERABAD, AUG. 14:
Andhra Pradesh, which is home to majority of the country’s emu population, will have a processing facility soon.

The facility will come up at Patancheru in Medak district with an investment of Rs 10 crore.

“It would have equipment and process to suit the FDA (United States Food and Drugs Administration) requirements,” N. Srinivas Chowdary, a promoter of AP Emu Processors Private Limited, said.

Andhra Pradesh accounts for more than half of the country’s emu population of 13 lakh.

“In the absence of processing facilities, the farmers are not fully realising the potential of emu meat and fat. We have tied up with about 1,500 farmers to procure the birds,” he said.

Chowdary is the Managing Director of AP Incubators Private Limited that produced about 700 incubators to hatch the birds. “We are in touch with the supply chain of the birds and we noticed the under realisation of potential,” he said.

“They are following crude methods for slaughter and production of oil. As a result, we see poor quality of oil with no standardisation,” he said.

He said there was huge scope for the emu oil in cosmetic and pharmaceutical industries globally.

“We have tied up with a US firm for procurement of the scientifically produced oil,” Chowdary said. With a view to creating awareness on the rearing of the bird and business opportunities, the company is organising a meeting in Hyderabad on August 19.