ISSUE 7

INSIDE THIS ISSUE

Moodys estimates of GDP growth rate
Industrial Growth rate figures
Bhusan Steel lands up in trouble
IFCI to raise Rs.2000 Cr via bonds
India Post set to hit ground running when it gets banking license

TAPMI Newsletter
Manufacturing Hub
We want a to give a
collective opportunity
to the world.
Come make in
India.I invite you
People expected that it will be Narendra
Modi's big-bang block buster speech that
will lay out the roadmap, but this has not
happened. Would you agree with me
that the concrete roadmap is still
missing?

This speech is directed at all of India. The
purport of speech is to instill a sense of
pride in the future of the country. There
are five or six elements in the speech that
obviously reflect a sense of priority,
whether it is women, government
servants or sanitation, whether it is skills,
manufacturing, safety or security.

The Key takeaways from the speech are:
Promote Made in India: Giving an
open invitation to the world to make
India a manufacturing hub, Modi said,

"Come make in India. Be it plastics or
cars or satellites or agricultural products,
come make in India."
Pradhan Mantri Jan-Dhan
Yojana: Modi launched the 'Pradhan
Mantri Jan Dhan Yojana' to help poor
open bank accounts that will come with
the facility of a debit card and an
insurance cover of Rs 1 lakh.

Digital India: Digital India is a dream
for the poor, with broadband
connectivity, we can ensure long-
distance education,"

Sansad Adarsh Gram Yojana: Modi
asked all MPs to developed a model
village in their constituencies by 2016.

Moratorium on violence: Called for
a 10-year moratorium on caste and
communal violence.

Planning Commission to
be replaced: Modi said
that he would replace the
Planning Commission that
for decades guided the
country's economy with a
more modern institution.
Clean India: The
government plans to launch
the Swacch Bharat plan in
October.
After this speech, critics
continue to ask Acche
din kab aayenge. He
has not laid down the
plan of Action for his
independence speech.
WAS IT A BLOCK BLUSTER SPEECH AT RED FORT?

TAPMI NEWSLETTER

COKE Buys 16.7% Stake in
Monster for $2.15 Billion: On
Thursday, it announced that it had
acquired a 16.7% stake in Monster for
$2.15 Billion. The deal unites the
biggest soda maker in the world with
the largest energy drink brand in the
United States.

GE in talks Again to Sell
Appliances Business: General
Electric is again in discussions over a
potential sale of its appliances business,
the century old division gave birth to
the wash dryer and the toaster oven.
Electrolux is in talks with them for this
acquisition.

JSW to buy Welspun
Maxsteel for 1K Crore: JSW
Steel will acquire smaller rival
Welspun Maxsteel for about Rs.1,000
Cr as Indias third largest steel maker
seeks to source cheaper raw material,
cut production costs and strengthen its
presence in the northern and western
markets.

BSE likely to Cut Equity
Transaction Fee by 15%:BSE
currently charges 3.25 for every 1 lakh
worth of trades in cash segment. The
transaction fee is likely to be cut to
2.75.

FIIs outpace Domestic
Investors in BSE200: The ratio
of investment by foreign institutional
investors compared with domestic
institutional investors in BSE 200
Companies has gone up 2:1 in June this
year from 1:4 five years ago. As per
some market strategist FIIs flows may
surpass 2012 record of $24 Billion.




1
Samsung loses its top
position in India but its
India head says the
contrary: Samsung's India head
has come down hard on research
agencies claiming that the Korean
major has lost its No 1 position in
the handset market, saying the
reports were driven by 'business
motive', although he conceded the
pace of growth for the electronics
company had slowed. BD Park,
president & chief executive for
south-west Asia, told in one of the
interviews that Samsung still holds
the lead in India with a share of
almost half the market. Earlier one
of the market research firm stated
that Samsung, the global leader in
smartphones, has lost its top
position in the Indian handset
market to the homebred Micromax
Informatics. According to the
agency, Micromax leads the overall
handset market with a 16.6%
market share as compared to
14.4% market share occupied by
Samsung India.
2

Jet Plans to Cut Costs via Joint
Sourcing with Etihad: Jet
Airways aims to save $100 million by
renegotiating contracts with its
vendors and suppliers with help from
its strategic partner Etihad Airways,
Indias second-biggest airline by
market share said in its latest annual
report. Saving costs and active
collaboration with its financially
muscled partner is critical for Jet to fly
out of its quagmire of losses. Etihad
owns 24% stake in Jet.
Jets latest reported financial figures
showed a record quarterly loss of
2,153.6 crore in January-March, up
more than four times on year.
Annual loss surged more than five-fold
to 4,129.8 crore, the equivalent of the
combined yearly losses of the previous
six years. Consolidated net worth fell
to a negative.

The airline has about 5,000 staff at the
top-ten airports and some airports
would need a reduction of up to 40%.
Jet should reconfigure 21 Boeing 737
planes to an economy class
configuration, which will lead to a net
additional revenue of $40 million.
Market Dashboard
BSE
26103.23
NIFTY
7791.70
$/Rs.
60.76
Gold
28614
Silver
43263
Crude
5829


3
India Post set to hit the
ground running when it
gets bank license: By seeking
to engage a service provider who
can supply up to 1.5 crore ATM/
debit cards in three years, the
Department of Posts (DOP) is
truly gearing up for its foray into
banking.

RBI, on its guidelines for licensing
of payment and small banks (July
2014) state that the objective of
these banks is to further financial
inclusion by providing small savings
accounts and payments/ remittance
services to the migrant labour
workforce, low-income
households, small businesses,
Sector entities and other users.

We think:
RBI is using the Indian Post
network of low income group to
penetrate the banking system
further into the rural areas. After
DOP becomes a payment bank
what happens to its core services of
mail and other retail services? Will
the private courier service
providers benefit from this move?


Sun Plans to Rise in Japan's
Pharma Mkt
Sun Pharmaceutical Industries, which is
in the process of acquiring control of
Ranbaxy Laboratories from Daiichi
Sankyo, will soon put its purchase to
work through the exclusive marketing
opportunity offered by two drugs in
the US, rationalising research and other
costs and eventually using its
association with the seller to crack the
Japanese market. Japan, the world's
largest drug market after the US and
Europe, has proved tough for Indian
players to succeed.The penetration of
generic drugs is less than 25%
compared with more 80% in the US
drug market. But the Japanese
government's intent to raise this share
to 60% by 2017 has prompted analysts
to dub it as the next big frontier for
Indian drug makers.

Petroleum ministry clears 5%
ONGC divestment: It may fetch the
government about Rs. 18,000 crore to
meet disinvestment target for the
current fiscal. As per the Budget 2014-
15, the disinvestment target
is Rs. 58,425 crore including receipts
from disinvestment of government
stake in the non-government
companies.RBI says FII investment
limit in Bank of Baroda has reached the
trigger limit. Further FII investment
will need RBI approval.

HUL to Split Home and Personal Care Biz
Hindustan Unilever is splitting its home and personal care (HPC) business into two
separate divisions for a sharper marketing focus, translating into a shake-up of its
top management that also sees Indias biggest consumer goods maker appointing a
woman as head of a business division. Priya Nair, 42, now vice-president, laundry,
will manage home care at Unilevers India unit. Samir Singh, 41, in charge of
Lifebuoy globally and personal care lead for the South Asia cluster, will head
personal care. A decade ago, the company replicated the organisational structure of
its Anglo-Dutch parent by consolidating its consumer goods businesses from five
segments into two home and personal care being one and foods the other. HUL
now gets nearly 75% of its revenue from its HPC portfolio while the foods business
contributes around 16%.



TAPMI NEWSLETTER ISSUE 7
JLR Drives up Tata Motors Net 212% to Rs. 5,400 Cr
Indias biggest automaker Tata Motors has posted 212% increase in its consolidated net
profit for the quarter ended June compared with the year ago period, helped by robust
sales volume growth of Jaguar Land Rover.
Tata Motors on Monday reported consolidated net profit of 5,398 crore in the first
quarter, up from 1,726 crore in the same quarter last year and way higher than any
street estimate. Its revenue on a consolidated basis grew 38% to 64,683 crore, up from
46,796 crore a year ago.

Domestic revenues for the June quarter dropped 15.4% year-on-year to 7,705 crore,
down from 9,105 crore a year ago while profit declined 44% to 393 crore from 703
crore. In China, JLRs sales volume grew 61% year-on-year in the June quarter. JLR
now derives nearly 29% of its total sales from the Chinese market, up from 21% a year
back. Except for the Japanese and Brazilian markets, JLR has outperformed industry
growth in the luxury car segment every other region.




After sprinting for a decade, are the good times over for Cognizant?

Ever since Francisco D'Souza took over as CEO of Cognizant in 2007, it looked as if the
company could do no wrong the US-based software provider outgrew the industry
even when rivals floundered during the global financial crisis. But over the past year or
so, it has been looking ragged and beginning to resemble rivals it vanquished not so long
ago. The spoilers were: Europe, where revenue fell 1 per cent sequentially, longer sales
cycles and continued weakness in its best-performing sectors, including manufacturing,
retail and healthcare.

Not surprisingly, both JPMorgan and Susquehanna International Group downgraded
Cognizant. Over the past few years, and especially since the Lehman crisis of 2008 that
saw Infosys and Wipro slip from the glory days, Cognizant has grown its annual revenues
at double the industry growth rates. It has even outpaced TCS, India's largest software
services company, consistently since then in terms of revenue growth.
For its part, Cognizant still enjoys top management stability and continues to win big
deals the $2.7-billion contract signed with Health Net during the June quarter was its
biggest win. The challenge for Cognizant will be to make up for the lost momentum
over the next six months.

Moodys pegs GDP growth at 5%
this year: Indian economy is likely to
expand in the range of 5.4 to 5.9 per
cent this fiscal, as per Government
estimates. The new Government,
which took charge in May, has
initiated various measures to attract
more investments and remove
bottlenecks in the infrastructure,
among others, to boost growth.


Industrial growth slows to 3.4%
in June: IIP for June month has come
at 3.4% against exp of 5.8%. As it is
for June month and most of the
companies result for Jun qtr is also out
as such should not have any impact on
market. Whereas CPI came at 7.96%
vs exp of 7.4% and MOM 7.31% this
may restrict RBI in taking any decision
on rate cut.


Bhusan steel landed in a debt
mess (Current D/E: 3.5 times): In
the past, debt repayments did not
matter as much for Bhushan Steel
because its operations generated cash
well in excess of what it had to pay by
way of interest and loan repayments.
The companys problems began in
2010-11, when its debt repayment
obligation more than trebled to
!1,118 crore. This was probably
because a part of the loans taken for
capacity expansion, including for
phases I and II of the Odisha plant,
became due. Bhushan Steels operating
cash flows of !994 crore, fell short of
its debt-repayment obligations.