Sectoral Snippets

India Industry Information

Issue 39 - January 2010

KPMG IN INDIA
 Page 2 of 19

Sectoral Snippets

Table of Contents

Russell Parera
1. Indian Economy 3
Chief Executive Officer
2. Auto and Auto Components 4
KPMG in India
3. Banking and Financial Services 5
Sectoral Snippets, Issue 39
4. Consumer Markets and Retail 6
The
Indian
economy
weathered
the
global
financial
crisis
in
a
relatively
prudent
manner
last
5. Hospitality 7
year,
supported
by
two
decades
of
strong
fundamentals,
revealing
the
strong
base
and
maturity
of
India’s
banking
system
and
financial
6. IT / ITeS 8
markets.
In
the
wake
of
the
new
year,
the
Indian
economy
gears
up
to
take
on
challenges
such
as 7. Media 9
high
inflation
especially
in
food
prices,
fiscal
imbalances
and
the
impact
of
an
insufficient 8. Oil and Gas 10
monsoon.
Another
key
issue
on
the
policy
maker’s
agenda
is
when
and
more
importantly 9. Pharma 11
how,
to
carry
out
the
reversal
of
the
measures
undertaken
to
counter
the
impact
of
the
global
10. Power 12
financial
situation,
as
the
timing
and
manner
of
the
same
is
bound
to
have
considerable
repercussions.

11. Real Estate and SEZs 13

Going
forward,
analysts
are
positive
on
the 12. Telecom 14

outlook
for
the
economy
this
year
with
positive
indicators
such
as
an
increase
in
industrial 13. Transport and Logistics 15
output.
From
recent
news
it
would
seem
that
the
GST
implementation
date
will
be
delayed
beyond
April
2011.
About Sectoral Snippets
I
hope
you
find
this
edition
of
the
Snippets
Sectoral Snippets is an India-focused, monthly, freely-distributable newsletter brought out by
informative
and
useful. KPMG in India. This newsletter provides an overview of the Indian economy in the form of
news-briefs from across key sectors.

Contact mknowledge@in.kpmg.com if you are interested in receiving this newsletter on a

Regards, regular basis, or wish to unsubscribe.
Russell

©
2010
KPMG,
an
Indian
Partnership
and
a
member
firm
of
the
KPMG
network
of
independent
member
firms
affiliated
with
KPMG
International
Cooperative
(“KPMG
International”),
a
Swiss
entity.
All
rights
reserved.
 Page 3 of 19

Indian Economy
As
India
has
emerged
strong
from
the
recession,
the
last
month
of
the
year
continued
to
post
an
upward
trend
in
growth.
The
Indian
Prime
Minister's
economic
panel
stated
that
the
growth
projection
of
6.5
percent
for
2009
will
be
revised
upward
on
the
back
of
the
high
growth
of
7.9
percent
in
the
quarter
of
the
fiscal.
Overall,
the
last
quarter
of
the
year
that
went
by,
witnessed
growth
in
many
key
areas
painting
a
glorious
picture
of
India’s
rebound.
Mineral
production
in
the
last
quarter
grew
by
8.25
percent
(as
of
October
2009)
while
the
manufacturing
sector
witnessed
growth
for
the
first
time
in
December
(2009)
since
October
(2009)
with
activity
reaching
its
highest
since
May
(2009)
on
account
of
the
sharp
rises
in
the
inflow
of
work
and
output.

The
other
areas
that
witnessed
growth
and
consequently
showcased
India’s
steady
recovery,
included
the
growth
in
exports.
The
country’s
exports
grew
for
the
first
time
in
14
months
ending
November
2009.
Overseas
shipments
increased
by
18.2
percent
to
USD
13.2
billion
in
November
from
a
year
earlier
after
sliding
to
an
average
of
21
percent
per
month
since
October
2008.
On
the
other
hand,
imports
fell
by
2.6
percent
to
USD
22.8
billion
in
November,
resulting
in
a
decrease
in
trade
deficit.

Furthermore,
experts
predict
that
2010
is
likely
to
be
marked
by
a
positive
domestic
outlook
fuelled
by
continued
growth
in
key
areas.
The
Prime
Minister's
economic
adviser
C.
Rangarajan
stated
that
the
economy
will
expand
by
8
percent
in
2010-11
supported
by
an
expected
improvement
in
agricultural
input.
A
large
portion
of
this
growth
can
be
attributed
to
the
growing
domestic
demand
Indicators 2010F 2011F and
the
high
levels
of
private
investment.
However,
the
downside
of
high
liquidity
Nominal GDP (USD in
the
system
is
rising
inflation.
India's
annual
wholesale
inflation
rose
to
4.78
1,541.9 1,800.6
Billion)*
percent
in
November
2009,
compared
with
1.34
percent
rise
in
October
2009.
Real
GDP
Growth* 6.8 7.8
Consequently,
the
current
fiscal
year
might
witness
a
reversal
of
the
GDP
Per
Capita 1300 1500 expansionary
monetary
policy
with
the
repo
rate
forecast
to
stand
at
6
percent
by
the
end
of
2010
and
at
6.75
percent
by
the
end
of
2011.
Inflation
Rate
(WPI)*** 2% 5%

Source: *EIU , *** Planning Commission Overall,
a
common
view
among
experts
is
that
if
supported
by
fiscal
and

monetary
intervention
in
the
right
direction,
2010
is
likely
to
be
a
year
of
expansion
and
distinct
improvement
in
growth
for
India.

Analyst: Asmita Deshmukh, Nishtha Satyam

©
2010
KPMG,
an
Indian
Partnership
and
a
member
firm
of
the
KPMG
network
of
independent
member
firms
affiliated
with
KPMG
International
Cooperative
(“KPMG
International”),
a
Swiss
entity.
All
rights
reserved.

“India is a strategic market for the
Volkswagen Group and holds
enormous potential for it”
Prof. Dr. Jochem Heizman, Member,
Board of Management, Volkswagen AG
(Source: Wheels Unplugged, Volkswagen commences
production of its first made-in-India car Polo, December
12, 2009)
Analyst: Ranjeet Javeri and Kudrat Puri
Page 4 of 19
Auto and Auto Components
• Volkswagen AG launches Beetle in India
Global
auto
major
Volkswagen
AG
reportedly
launched
its
hatchback
model,
the
Beetle,
in
India.
Positioned
as
a
luxury
hatchback,
the
Beetle
is
expected
to
be
priced
at
about
USD
42716
ex-showroom
in
Delhi.
The
company
is
expected
to
import
this
model
as
a
completely
built
unit
(CBU)
from
Mexico,
attracting
a
duty
of
over
100
percent.
It
has
been
reported
that
there
were
over
170
advance
bookings
for
the
iconic
Volkswagen
model.
The
Beetle
is
anticipated
to
help
popularize
the
Volkswagen
brand
in
India.
• M&M to consolidate auto parts businesses under Systech
Indian
vehicle
maker
Mahindra
and
Mahindra
Ltd
plans
to
consolidate
its
auto
components
businesses
into
a
single
entity
under
the
Systech
brand.
The
consolidation
is
believed
to
result
in
significant
cost
reduction
for
the
company
as
well
as
rationalization
of
its
widespread
marketing
operations.
Mahindra
Group
firms
such
as
Mahindra
Forgings,
Mahindra
Composites,
Mahindra
Gears,
Mahindra
Castings,
Mahindra
Ugine
would
reportedly
be
clubbed
together
under
the
Systech
brand.
• Michelin to manufacture tyres in India
French
tyre
manufacturer
Michelin
plans
to
set
up
a
production
facility
in
Tamil
Nadu
to
manufacture
tyres
for
commercial
vehicles.
The
company
is
estimated
to
invest
USD
859.2
million
and
is
expected
to
start
its
operations
by
2012.
Michelin
has
reportedly
signed
a
Memorandum
of
Understanding
with
the
Tamil
Nadu
government
for
the
plant’s
construction
in
the
Tiruvallur
district.
The
company
is
likely
to
hire
1500
workers
from
the
local
population.
• Fuji Heavy Industries to launch models in India
Fuji
Heavy
Industries
Ltd
plans
to
foray
into
the
Indian
car
market
in
2011,
with
the
launch
of
its
models
including
its
flagship
Legacy
sedan.
The
company
is
also
likely
to
mull
launching
its
Forester
sports
utility
vehicle
in
India.
Fuji
has
reportedly
received
inquiries
from
Indian
sales
offices
and
trading
companies,
and
is
expected
to
choose
a
partner
for
its
Indian
operations
soon.
©
2010
KPMG,
an
Indian
Partnership
and
a
member
firm
of
the
KPMG
network
of
independent
member
firms
affiliated
with
KPMG
International
Cooperative
(“KPMG
International”),
a
Swiss
entity.
All
rights
reserved.
 Page 5 of 19

Banking and Financial Services

• Kotak ties up with Russia's top I-bank for M&A advisory services in
CIS, Africa
Kotak
Mahindra
Bank,
investment
banking
subsidiary
Kotak
Investment
has
entered
into
an
alliance
with
Renaissance
Capital(a
part
of
the
Renaissance
Group),
one
of
the
leading
investment
bank
in
Russia,
Central
Asia,
Eastern
Europe
and
Africa.
The
alliance
is
likely
to
enable
the
bank
to
engage
in
cross-
border
M&A
advisory
services
in
Commonwealth
of
Independent
States
(CIS)
countries
and
Africa
by
leveraging
Renaissance
Capital
experience
in
these
markets.

As
per
industry
sources,
many
Indian
companies
are
exploring
opportunities
for
buy-outs
in
oil
&
gas
and
natural
resources
across
the
African
region
and
CIS
countries.
Similarly,
Russian
firms
and
other
companies
from
CIS
are
also
looking
at
the
Indian
market
for
an
expansion
in
the
metals
segment.
Both
the
companies
can
take
advantage
of
the
interest
shown
by
other
players.

• Indiabulls plans to foray into infra financing business segment

Indiabulls
Financial
Services
Ltd.
(IBFSL)
is
planning
to
venture
into
the
infrastructure
and
construction
equipment
financing
space,
primarily
to
capitalize
on
the
growing
need
of
infrastructure
projects.
The
company
is
planning
to
disburse
about
USD
1.7
billion
in
the
coming
year
and
also
plans
to
launch
auto
loans
products
and
scale
up
its
commercial
vehicle
finance
business.

Further,
it
is
planning
to
venture
into
the
financing
businesses
through
a

wholly-owned
subsidiary
Indiabulls
Infrastructure
Credit
Ltd
(IICL),
which
has
Credit Growth received
the
nonbanking
finance
company
(NBFC)
license
from
the
Reserve
Bank
of
India
(RBI).

December YOY
USD billion
4, 2009 (percent)

Bank Credit 633.0 10.5 • ICICI Bank plans to raise capital through Tier I and Tier II bonds
ICICI
Bank,
is
planning
to
raise
USD
860
million
capital
through
the
issue
of
–
Food
Credit
9.7 -13 Upper
Tier-II
and
Tier-I
perpetual
bonds.
The
bank
is
planning
to
issue
Upper
Tier-
II
bonds
and
Tier-I
hybrid
bond
for
USD
430
each.
The
capital
is
likely
to
enable
–
Non-food
Credit
623.3 11
the
bank
to
support
its
business
growth.

Deposits 911.3 18.3 As
per
credit
rating
agency
CRISIL,
ICICI
Bank
is
considered
as
one
of
the
highly
capitalized
banks
with
an
overall
capital
adequacy
ratio
(CAR)
of
17.7
percent
and
–
Demand
Deposits
113.9 19.4
Tier-I
CAR
of
13.3
percent
as
on
September
30,
2009.

–
Time
Deposits

797.4 18.2

Investments
Credit
–
deposit
ratio
(percent)

Investment
–
deposit
ratio
(percent)
Source:
RBI,
India
Infoline
Research

300.3 25.6 • OBC plans open offices in Hong Kong and Africa
Oriental
Bank
of
Commerce
(OBC),
one
of
the
leading
public
sector
banks,
69.5 (491.8)
bps expects
to
open
more
foreign
offices,
as
a
part
of
its
efforts
to
expand
its
global
footprint.
The
bank
is
in
the
process
of
seeking
RBI’s
permission
for
more
33 190.8
bps overseas
offices
preferably
in
Hong
Kong.
The
bank
believes
that
a
full-service
branch
in
Hong
Kong
provides
business
opportunity
in
terms
of
trade
financing
to
Indian
corporates.
In
addition,
the
bank
is
also
exploring
opportunites
in
Africa.

Analyst: Kunal Jain and Ruchika Anand

©
2010
KPMG,
an
Indian
Partnership
and
a
member
firm
of
the
KPMG
network
of
independent
member
firms
affiliated
with
KPMG
International
Cooperative
(“KPMG
International”),
a
Swiss
entity.
All
rights
reserved.

“Marks & Spencer believes India
offers significant expansion
opportunities and the potential is
huge with a wider range of
products, bigger M&S stores and
a better brand experience overall”
Nandini Sethuraman, Head of Marketing, Marks &
Spencer Reliance India Pvt Ltd Head
(Source: The Economic Times, Marks & Spencer to
scale up India operations, December 14, 2009)
Analyst: Sonia Topiwala
Page 6 of 19
Consumer Markets and Retail
• Indian consumer goods company Marico acquires a Colgate Palmolive
brand
Indian
consumer
goods
major
Marico
has
bought
Colgate
Palmolive’s
hair
care
brand,
Code
10,
to
push
its
revenue
growth
in
the
South-East
Asian
markets
and
strengthen
its
position
to
fight
future
competition
in
India.
The
acquisition
is
estimated
to
be
about
USD
5.4
million
as
per
industry
sources
and
also
involves
getting
intellectual
property
rights
related
to
the
brand
from
Colgate-Palmolive.
The
acquisition
of
Code
10
is
likely
to
bring
a
strong
consumer
equity
in
Marico’s
portfolio
and
the
brand
is
expected
to
serve
as
a
platform
to
the
South-East
Asian
market.
Code
10
is
the
third-largest
selling
brand
in
Malaysia.
• Marks and Spencer aims to expand in India
The
British
retailer,
Marks
&
Spencer,
is
looking
at
scaling
up
its
India
operations
and
plans
to
open
at
least
50
more
outlets
in
the
country
over
the
next
few
years.
The
company,
which
is
present
in
India
through
a
joint
venture
(JV)
with
Reliance
Retail,
is
also
looking
at
increasing
its
product
range
in
the
country.
• Gucci to enter Indian retail through single brand stores
Italian
designer
goods
maker
Gucci
can
now
go
ahead
with
its
plans
to
enter
the
Indian
retail
market
through
single
brand
stores
with
the
government
allowing
it
to
pick
up
a
majority
stake
in
its
Indian
franchisee
Luxury
Goods
Retail.
The
government
has
cleared
a
proposal
by
Luxury
Goods
Retail
for
foreign
equity
participation
of
51
percent
by
Gucci
Group
NV,
Netherlands
with
an
investment
of
USD
0.2
million
for
retailing
Gucci
brands
in
the
country.
Luxury
Goods
Retail
currently
sells
products
under
the
Gucci
brand
in
India
under
a
franchise
agreement.
The
company
currently
has
two
stores
located
in
Delhi
and
Mumbai.

• South African Café forays into India
South
African
premium
cocktail-
bar
chain
News
Cafe
plans
to
invest
up
to
USD
21.5
million
over
the
next
5
years
to
expand
operations
in
India.
The
company,
which
recently
ventured
into
India
under
a
master
franchise
agreement
with
Hyderabad-based
Numbersonly
Hospitality
plans
to
open
20
outlets
across
India
in
the
next
5
years.
The
café
has
just
opened
its
first
Indian
restaurant
at
Delhi,
which
also
marks
its
first
foray
outside
the
African
continent.
It
plans
to
open
four
more
cafes
in
India
in
2010.
The
investment
is
likely
to
come
from
the
franchise
operator,
Numbersonly
Hospitality
and
the
franchise
arrangement
could
be
extended
for
other
South
Asian
countries
and
Mauritius
in
the
future.

• India’s diversified conglomerate, Essar group acquires electronics store X-Cite
Essar
group
has
entered
into
the
consumer
durables
and
IT
products
business
through
the
acquisition
of
X-Cite,
the
chain
of
large
format
electronics
stores
of
Impact
Retail,
a
franchisee
of
Kuwait's
Alghanim
Industries
for
an
undisclosed
sum.
Essar
is
expected
to
scale
up
the
number
of
retail
outlets
to
2,500
by
fiscal
2011
from
the
existing
1,300
stores.
The
consumer
durables
and
IT
market
is
currently
growing
at
15
percent
and
Essar
is
aiming
around
10
percent
of
market
share
in
the
next
5
years.
Essar-promoted
cellular
retail
chain
The
MobileStore
is
expected
to
take
over
the
seven
stores
of
Impact
Retail's
X-Cite
across
Delhi,
Gurgaon,
Bangalore,
Hyderabad,
Pune
and
Ahmedabad,
spanning
over
95,000
sq
ft.
Impact
Retail,
a
franchisee
of
Kuwait-based
Alghanim
Industries,
entered
India
last
year.

©
2010
KPMG,
an
Indian
Partnership
and
a
member
firm
of
the
KPMG
network
of
independent
member
firms
affiliated
with
KPMG
International
Cooperative
(“KPMG
International”),
a
Swiss
entity.
All
rights
reserved.

“We expect recovery to take place
in the hotel business by the last
quarter of 2010 and in the next
18-24 months we expect the
demand to outstrip supply”
Rajeev Menon, Area Vice-President, Marriott
International (India, Pakistan, Maldives and Malaysia)
(Source: Business Standard, Marriott to Open 18 Hotels
in India, December 23, 2009)
Analyst: Pallavi Phatak
Page 7 of 19
Hospitality
• Bharat Hotels forays into budget segment
Bharat
Hotels
which
owns
and
operates
hotels
under
the
brand
name
‘The
Lalit’
plans
to
expand
its
footprint
in
the
economy
segment.
The
company
is
likely
to
invest
USD
491.5
million
to
set
up
a
number
of
luxury
and
mid-market
hotels
across
business
and
leisure
destinations
in
India
and
abroad.
Looking
at
the
budget
segment’s
impressive
growth
over
the
last
few
years
the
company
may
have
an
economy
brand
in
the
next
2-3
years.

• Videocon checks into hospitality sector
Videocon
group
is
making
an
entry
into
the
hospitality
business.
It
plans
to
set
up
a
hotel
as
a
part
of
its
upcoming
USD
~192
million
IT
Park
at
Salt
Lake,
West
Bengal.
The
hotel
is
likely
to
cater
to
the
IT
and
ITeS
companies
in
this
proposed
mixed
use
development.
Considering
the
success
of
this
project,
the
group
is
likely
to
explore
the
expansion
opportunities
in
the
hospitality
business
across
the
country.
The
company
is
negotiating
with
a
number
of
international
hotel
chains
for
a
possible
tie-up
with
its
upcoming
property.

• Zuri to set up hotels in India and Kenya
Zuri
Hospitality
India
plans
to
invest
USD
85.5
million
to
develop
two
new
hotels.
The
company
is
likely
to
set
up
a
new
property
near
Bangalore
International
Airport.
The
other
property
is
expected
to
come
up
at
Nairobi
in
Kenya.
The
company
has
raised
around
30
percent
of
the
funds
required
for
the
new
projects
from
private
investors
in
West
Asia,
while
the
rest
has
been
raised
from
nationalized
banks.
Currently,
it
has
four
five-star
properties
in
India.
The
hospitality
firm
is
also
exploring
the
management
route
to
expand
its
hotels
business.

• Sahara Hospitality to set up seven more hotels
Sahara
Hospitality
Ltd.
is
likely
to
set
up
seven
properties
across
India
by
end-
2012.
It
is
likely
to
add
over
1,000
rooms
to
its
portfolio.
The
company
is
exploring
the
option
of
acquiring
some
existing
properties
and
is
also
looking
at
Greenfield
projects
for
expansion.
Hotel
Sahara
Star,
is
the
only
premium
property
owned
by
Sahara
Hospitality
which
has
an
inventory
of
223
rooms.
©
2010
KPMG,
an
Indian
Partnership
and
a
member
firm
of
the
KPMG
network
of
independent
member
firms
affiliated
with
KPMG
International
Cooperative
(“KPMG
International”),
a
Swiss
entity.
All
rights
reserved.
 Page 8 of 19

IT/ITeS
• HCL Axon bags deal with GSK
HCL
Technologies
has
signed
a
multi-year
deal
worth
about
USD
200
million
with
a
UK-based
insurance
firm
Equitable
Life
Assurance
Society
(ELA).
As
per
the
terms
of
the
deal,
HCL
would
provide
complete
solutions,
including
policy
administration,
finance,
actuarial
services,
IT
operational
support
and
call
center
services
to
ELA.
The
deal
has
been
signed
with
HCL
Insurance
Business
Services,
HCL’s
UK-based
life
and
pensions
administration
business
arm.

• IBM gets USD 82 million deal from Digicable

IBM
has
bagged
a
10-year
outsourcing
contract
from
Digicable,
a
cable
and
broadband
distribution
player
in
India.
The
USD
82
million
deal
is
to
support
the
integration
of
Digicable’s
digital
media
content
delivery
and
value
added
services
application
by
providing
IT
infrastructure
services
network,
support
application
maintenance
services
and
security
services.
Prior
to
this,
IBM
has
already
signed
deals
with
media
and
entertainment
companies
like
Star
TV,
Sun
TV
and
Tata
Sky.

• Interglobe opens BPO centre in Manila

Gurgaon-based
BPO
services
firm
InterGlobe
Technologies
(IGT)
has
launched
its
BPO
delivery
center
in
Manila,
Philippines
with
an
initial
outlay
of
USD
2.3
million.
The
400-seater
unit
has
already
hired
350
people
and
may
further
recruit
650
people
with
an
additional
investment
for
the
same.

“We are exiting 2009 with some

• HCL Tech bags multi-million pound deal from News Corp arm
level of optimism, as the demand HCL
Technologies
has
signed
a
5-year
multi-million
pound
deal
with
News
environment appears to be International,
(NI)
a
UK
arm
of
global
media
firm
News
Corporation.
The
deal
is
to
provide
software
services
in
terms
of
technology
infrastructure
management
improving compared with last and
transformation.
As
per
the
agreement,
HCL
would
manage
NI’s
data
centre
and
network
environments
thereby
reducing
its
operational
costs
and
year. Customers will spend on increasing
technology
process
standardisation.

transformational engagements —
• Wipro in deal with Telefonica O2 Germany
both in terms of demand Wipro
Technologies
has
signed
a
deal
with
a
Germany-based
Telefonica
O2
generation for their business and Germany
(TOG)
for
an
undisclosed
amount.
As
per
the
deal,
Wipro
would
provide
testing
services
and
solutions
like
test
analysis,
management
and
cost transformation” execution,
deployment,
integration
and
implementation
management
services.
Suresh Vaswani, Joint CEO of Wipro Technologies,
India’s third-largest IT company.
• Indian IT market to double to USD 13 billion by 2013
(Source: Business Standard, Analysts more optimistic
According
to
a
study
conducted
by
Springboard
Research,
Indian
IT
services
about IT services companies, December 31, 2009) market
is
expected
to
touch
USD
13
billion
by
2013.
The
domestic
market
is
expected
to
grow
at
an
average
of
nearly
19
percent
annually
from
USD
5.7
billion
in
March
2008.
The
study
further
states
that
infrastructure
management
services
(IMS)
are
expected
to
reach
USD
7.2
billion
in
2013
with
53
percent
market
share,
and
a
CAGR
of
18.1
percent
from
2008-13.
However,
applications
services
with
a
growth
rate
of
19.6
percent
are
expected
to
remain
the
fastest
growing
market
segment.
In
terms
of
verticals,
banking,
financial
services
&
insurance
is
likely
to
lead
the
market
with
about
21
percent
of
the
market
share.

Analyst: Yesha Mehta

©
2010
KPMG,
an
Indian
Partnership
and
a
member
firm
of
the
KPMG
network
of
independent
member
firms
affiliated
with
KPMG
International
Cooperative
(“KPMG
International”),
a
Swiss
entity.
All
rights
reserved.

“The only property that has taken
off well in India is cricket, but
there is potential for many other
sporting events. Therefore, to that
extent, Sony has an advantage”
Shashi Sinha, CEO, Lodestar Universal
(Source: Financial Express, MSM to launch a sports
channel, December 23, 2009)
Analyst: Mehul Desai
Page 9 of 19
Media
• Reliance Mediaworks to set up a joint venture with In-Three
Reliance
Mediaworks
formerly
known
as
Adlabs
Films
has
entered
in
a
joint
venture
with
US-based
In-Three.
The
JV
would
set
up
a
studio
for
converting
2D
movies
into
3D
in
India.
The
studio
would
primarily
focus
on
Hollywood
titles
and
content
from
global
clients
of
In-Three
and
not
Indian
content.
The
JV
is
expected
to
do
15-25
feature
film
projects
in
a
year
with
the
first
project
expected
to
commence
in
early
2010.
• MSM to launch a sports channel
Broadcast
network
Multi
Screen
Media
(MSM)
is
expected
to
launch
a
new
sports
channel
to
cash
in
on
the
popularity
of
its
exclusively-owned
property,
the
Indian
Premier
League
(IPL).
According
to
the
Chief
Operating
Officer,
N
P
Singh,
the
channel
is
expected
to
be
launched
in
the
next
6-9
months
as
the
network
is
acquiring
other
sporting
events.
Besides
IPL,
the
network
has
broadcast
rights
for
New
Zealand
Cricket
series
and
FA
cup.
In
India,
sports
channels
gross
approximately
USD
320-340
million
annually
in
advertising
revenues,
but
however,
their
share
in
overall
television
viewship
has
shrunk
from
4.8
percent
in
2004
to
2.7
percent
currently.
MSM
runs
a
diversified
bouquet
of
channels,
including
Sony
Entertainment
Television,
SAB
TV,
Set
Max
and
Channel
8.
• Digicable increases stake in CableComm
Digicable
Network
has
increased
its
stake
in
Kolkata-based
multi-system
operator
(MSO)
CableComm
from
51
percent
to
80
percent.
In
2008,
Digicable
had
invested
USD
6.4
million
for
a
51
percent
stake.
DigiCableComm
Services,
as
the
company
is
now
known
has
presence
in
14
out
of
18
districts
in
West
Bengal
and
is
expected
to
launch
broadband
services.
DigiCableComm,
had
plans
to
expand
its
services
in
neighboring
states
like
Orissa,
has
decided
not
to
pursue
inter-state
ambitions
for
now
and
focus
on
digitizing
and
strengthening
its
foothold
in
Kolkata
Metropolitan
Area.

• Indian console gaming market to reach USD 123 million in 2010
According
to
a
study
by
research
firm
eTech
Group,
console-based
gaming
market
in
India
is
expected
to
reach
USD
123
million
by
2010.
The
console
gaming
market
is
expected
to
grow
at
41
percent
from
INR
86.5
million
in
2009.
On
the
other
hand,
mobile
gaming
industry
which
is
currently
valued
at
USD
61.8
million
is
expected
to
grow
to
USD
173.5
million
in
2010.
The
report
also
highlights
that
low
broadband
speed
and
price
sensitivity
are
posed
as
major
barriers
to
the
growth
of
the
industry.

• Sri Adhikari Brothers plans to launch regional channels
Sri
Adhikari
Brothers
plans
to
launch
regional
entertainment
channels
for
which
it
is
expected
to
raise
USD
21.6
million
through
issue
of
securities.
The
company
has
also
approved
the
offering
and
issue
of
up
to
2.92
million
warrants
to
the
promoter
group.
The
company
launched
Hindi
views
channel
Janmat,
which
was
later
changed
into
Hindi
news
channel
Live
India.
It
has
also
entered
into
the
Marathi
entertainment
arena
with
Mi
Marathi.
Sri
Adhikari
Bros
sold
51
percent
stake
in
both
the
channels
to
property
developer
HDIL
group.
©
2010
KPMG,
an
Indian
Partnership
and
a
member
firm
of
the
KPMG
network
of
independent
member
firms
affiliated
with
KPMG
International
Cooperative
(“KPMG
International”),
a
Swiss
entity.
All
rights
reserved.

“Urea imports are making a dent
on the country's economy and
hence it is imperative to step up
fertiliser production to help India
achieve food security”
Mr R.S. Nanda, Director and COO of Nagarjuna
Fertiliser and Chemicals Ltd.
(Source: The Hindu Business Line, Fertiliser industry
seeks more gas allocation, December 24, 2009)
Analyst: Sidharth Balakrishna and Neha Saraf
Page 10 of 19
Oil and Gas
• Spanish and Malaysian firms join hands with Indian firms to bid for
oil projects in Venezuela
Spain’s
Repsol
YPF
SA
and
Malaysia’s
Petronas
have
joined
hands
with
ONGC
Videsh
Ltd
(OVL),
the
overseas
investment
arm
of
Oil
and
Natural
Gas
Corporation,
along
with
Indian
Oil
Corporation
(IOC)
and
Oil
India
Ltd
(OIL)
to
bid
for
the
Carabobo
project
in
Venezuela’s
Orinoco
oil
belt.
A
maximum
of
40
per
cent
stake
is
being
offered
by
Venezuela
for
the
development
of
this
acreage,
with
the
rest
being
held
by
Petroleos
de
Venezuela
SA,
(PdVSA),
Venezuela’s
state
oil
company.
Repsol
and
Petronas
together
are
expected
to
hold
25
per
cent,
OVL
10.1
per
cent
while
IOC
and
OIL
2.45
per
cent
each.

Mukesh
Ambani’s
Reliance
Industries
Ltd.
(RIL)
was
earlier
expected
to
work
together
with
the
Indian
companies
and
was
to
equally
divide
32-33
percent
stake
with
OVL,
the
rest
being
shared
by
IOC
and
OIL.
It
was,
however,
replaced
by
the
Spanish
and
Malaysian
firms.
• Fertilizer industry steps up campaign for increased gas allocation
The
demand
for
gas
from
user
industries
like
fertilizers,
power,
glass
and
ceramic
sector
is
increasing
in
line
with
the
increased
gas
production
from
RIL’s
KG
Basin,
along
with
possible
future
production
from
ONGC
and
GSPC
blocks.
Gas
demand
within
the
country
currently
stands
at
196
million
standard
cubic
meters
a
day
(mmscmd),
and
is
expected
to
touch
280
mmscmd
by
2011-12.
Besides
increased
gas
allocation,
the
fertilizer
industry
is
requesting
for
two
amendments,
change
of
gas
transmission
methodology
from
the
existing
slab
basis
to
a
distance
basis
and
that
of
the
gas
allotment
system
from
the
existing
volume
basis
to
energy
basis.
The
fertilizer
industry
has
requested
for
an
increased
gas
allocation
on
arguments
of
food
security
as
the
demand
for
food
is
expected
to
touch
300
million
tonnes
by
the
end
of
the
next
Plan
Period
from
the
current
220
million
tonnes.
GAIL,
which
currently
has
about
11,000
km
of
pipelines
capable
of
transporting
275
mmscmd
of
gas
across
the
country,
is
planning
to
expand
its
pipeline
infrastructure
by
2011-12
on
prospects
of
increasing
gas
availability.
• Design capacity of KG D6 facilities successfully tested
Mukesh
Ambani’s
RIL,
which
currently
produces
about
60
mmscmd
of
gas
from
two
of
the
18
gas
discoveries
in
the
KG
D6
block,
successfully
tested
the
design
capacity
of
the
KG
D6
deepwater
gas
production
facilities
and
has
achieved
a
flow
rate
of
80
mmscmd
as
envisaged.
These
volumes
were
delivered
to
Reliance
Gas
Transportation
Infrastructure
Ltd
(RGTIL).
The
D6
field
has
produced
over
8.5
billion
cubic
meters
of
gas
since
it
commenced
production
in
April
2009.
The
KG
D6
gas
has
impacted
various
aspects
of
the
country's
economy
besides
contributing
to
India’s
critical
industrial
sectors.
The
Index
of
Industrial
Production
(IIP)
figures
reflected
double
digit
growth
in
the
mining
sector
in
the
last
two
quarters
owing
to
the
KG
D6
gas
contribution.
Besides
this,
a
growth
of
about
30
per
cent
was
achieved
in
gas-based
power
generation
in
the
country
from
April
to
November,
leading
to
a
reduction
in
power
deficit
in
the
same
period.Compared
to
the
world
average
of
9-10
years
for
similar
deepwater
production
facilities,
RIL
started
gas
production
in
KG
D6
in
six
and
a
half
years
from
discovery.
©
2010
KPMG,
an
Indian
Partnership
and
a
member
firm
of
the
KPMG
network
of
independent
member
firms
affiliated
with
KPMG
International
Cooperative
(“KPMG
International”),
a
Swiss
entity.
All
rights
reserved.

“The Indian pharmaceutical industry,
now over one lakh crore (USD 20
billion) industry, has shown
tremendous progress in terms of
infrastructure development,
technology base creation and a wide
range of products. The country now
ranks third worldwide by volume and
14th by value thereby accounting for
around 10 percent of the world's
production by volume and 1.5
percent by value”
Srikant Kumar Jena, Minister of State in the Chemicals
and Fertilisers Ministry
(Source: The Economic Times, India's drug industry is
over Rs one lakh crore, December 3, 2009)
Analyst: Nandita Kudchadkar and Parnika Dayal
Page 11 of 19
Pharma
• Hospira enters into agreement to acquire Orchid Chemicals’
generic injectable business
Hospira,
Inc.,
a
US-based
global
specialty
pharmaceutical
and
medication
delivery
company,
has
inked
an
agreement
with
Orchid
Chemicals
&
Pharmaceuticals
Limited,
an
Indian
pharmaceutical
company,
to
acquire
the
latter’s
generic
injectable
finished-dosage
form
pharmaceuticals
business.
The
consideration
for
the
same
is
reported
to
be
around
USD
400
million.
The
acquisition
is
expected
to
involve
Orchid
Chemicals’
beta-lactum
antibiotics
manufacturing
complex,
the
pharmaceutical
research
and
development
facility
at
Irungattukottai,
Chennai
as
well
as
the
generic
injectable
product
portfolio
and
pipeline.

Besides
this,
Hospira
and
Orchid
Chemicals
have
also
entered
into
an
exclusive
agreement
for
the
supply
of
active
pharmaceutical
ingredients
(API)
by
Orchid
Chemicals
for
the
acquired
injectable
pharmaceuticals
business.
• Dishman Pharma forms JV in Saudi Arabia for API production
Dishman
Pharmaceuticals
and
Chemicals
Limited,
a
leading
contract
manufacturing
organization
in
India,
has
reportedly
formed
a
Joint
Venture
(JV)
company
with
three
partners
for
manufacturing
APIs
in
Saudi
Arabia.
While
Dishman
Pharma
has
a
30
percent
stake
in
the
venture,
its
partners
Arab
Company
for
Drug
Industries
and
Medical
Appliances
(ACDIMA),
Spimaco,
and
the
Capital
Advisory
Group
hold
the
remaining
stake.
The
JV
company
has
been
offered
a
USD
55
million
soft
loan
for
15
years
by
the
Saudi
Industrial
Development
Fund.
• Intas Pharma enters into partnership with US-based Amarillo
Biosciences
Intas
Pharmaceuticals
Limited,
an
Indian
pharmaceutical
company,
has
reportedly
entered
into
a
strategic
partnership
with
US-based
biotechnology
firm
Amarillo
Biosciences,
Inc.
Under
the
agreement,
Intas
is
expected
to
sponsor
clinical
trials
of
Amarillo
Biosciences’
orally
administered
interferon-alpha
lozenges
which
are
used
to
combat
influenza
viruses
such
as
the
H1N1
virus.
Amarillo
Biosciences
is
expected
to
receive
a
royalty
from
Intas
Pharma
on
the
net
sales
once
the
marketing
approval
is
received
in
India.
• Ranbaxy to market Daiichi Sankyo’s anti-hypertensive product in
six African countries
Ranbaxy
Laboratories
Limited
and
Daiichi
Sankyo
Company
Limited
announced
that
the
former
will
likely
market
the
latter’s
lmesartan
Medoxomil,
an
anti-
hypertensive,
in
six
African
countries
—
Kenya,
Nigeria,
Tanzania,
Uganda,
Mozambique,
and
Zambia
—
under
the
brand
name
Olvance™.
The
two
companies
have
been
seeking
to
leverage
synergies
through
their
hybrid
business
model
and
had
recently
explored
similar
collaborations
in
Mexico
and
Romania.
©
2010
KPMG,
an
Indian
Partnership
and
a
member
firm
of
the
KPMG
network
of
independent
member
firms
affiliated
with
KPMG
International
Cooperative
(“KPMG
International”),
a
Swiss
entity.
All
rights
reserved.

“Rosa project would be the largest
private sector investment in UP
with investment outlay over Rs
6000 crore. It will add around 20
percent to the existing generating
capacity of the state and will
greatly contribute to the reducing
power deficit”
J P Chalasani, CEO, Reliance Power
(Source: The Economic Times, Phase I of Rosa plant
goes onstream, December 29, 2009)
Analyst: Sidharth Balakrishna and Neha Saraf
Page 12 of 19
Power
• Reliance Power commences power generation from Rosa Power
Plant
Anil
Dhirubhai
Ambani
Group
(ADAG)’s
Reliance
Power
commenced
generation
from
its
1200
Mw
coal-based
Rosa
power
plant
in
Shahjahanpur
district
of
Uttar
radesh.
The
project
(comprising
of
two
stages
of
600
Mw
each)
commissioned
300
Mw
capacity
of
the
first
phase
(consisting
of
two
units)
four
months
before
schedule.
The
entire
plant
is
expected
to
be
fully
operational
by
the
end
of
the
Eleventh
Plan
by
March
2012.

The
company
has
entered
into
a
long-term
contract,
valid
for
the
entire
plant
life
of
25
years,
with
Central
Coalfield
Limited
(CCL)
in
Jharkhand
for
fuel.
Further,
the
fly
ash
produced
at
the
plant
is
to
be
utilized
in
a
cement
unit
run
by
ADAG.
The
company
has
entered
into
a
Purchasing
Power
Agreement
to
supply
entire
600
Mw
of
first
phase
to
UP
Power
Corporation
Limited
(UPPCL)
along
with
an
additional
300
Mw
of
the
second
phase.
The
balance
300
Mw
is
expected
to
be
sold
on
a
merchant
basis
to
outside
consumers.
The
project
is
expected
to
start
commercial
operations
in
a
few
months
after
the
completion
of
the
trial
run.
• India and Bhutan enter into Power MoUs
India
and
Bhutan
have
entered
into
seven
Memorandum
of
Agreements
(MoUs)
to
tap
Bhutan’s
power
potential
and
meet
India’s
need
for
it.
Besides
preparation
of
detailed
project
reports
for
Amochhu
(620
Mw),
Kuvi-Gongi
(1800
Mw),
Kholongchhu
(486
Mw)
and
Chamkarchu-I
(670
Mw)
projects,
the
agreements
also
include
setting
up
a
master
plan
for
a
national
transmission
grid
in
Bhutan.
As
per
the
agreements,
India
is
now
eligible
to
import
additional
10,000
Mw
hydro
power
from
Bhutan
by
2020.
Bhutan,
with
hydro
power
capacity
of
30,000
Mw,
requires
only
about
500
Mw
and
already
exports
1000
Mw
of
power
to
India
out
of
its
total
generation
of
about
1,500
Mw.
• Ultra Mega Power Projects resolve land issues
The
two
Ultra
Mega
Power
Projects
in
Tamil
Nadu
and
Orissa
respectively
are
expected
to
soon
issue
‘Requests’
for
Qualifications.
Both
the
projects,
each
of
~
4,000
Mw
capacities,
were
earlier
delayed
for
several
months
due
to
land
acquisition
problems.
The
project
at
Cheyyur,
Tamil
Nadu
is
expected
to
be
based
on
imported
coal
and
provide
electricity
to
the
state
and
neighbouring
ones,
while
the
one
at
Bedabahal
in
Sundergarh
district,
Orissa,
has
been

allocated
coal
blocks
at
Meenakshi,
Meenakshi
B
and
Meenakshi
dipside.
These
projects
are
expected
to
be
attractive
to
both
domestic
and
international
players
since
the
power
ministry
has
relaxed
a
few
norms
recently
and
has
also
allowed
the
sale
of
surplus
coal
from
captive
mines
and
power
beyond
4,000
Mw
at
competitive
rates.
©
2010
KPMG,
an
Indian
Partnership
and
a
member
firm
of
the
KPMG
network
of
independent
member
firms
affiliated
with
KPMG
International
Cooperative
(“KPMG
International”),
a
Swiss
entity.
All
rights
reserved.
 Page 13 of 19

Real Estate and SEZs

• Maharashtra State Government to mobilize USD 1084 million
through increase in ready reckoner rates
The
Maharashtra
State
Government
increased
market
value
of
real
estate
by
10-
20
percent
in
its
ready
reckoner
2010.
Ready
reckoner
is
a
guide
for
the
market
price
of
residential
and
commercial
properties,
based
on
which
the
stamp
duty
and
registration
fee
for
their
sale
and
purchase
are
calculated.
This
move
is
expected
to
raise
the
sale
price
of
finished
property
due
to
a
rise
in
the
cost
of
land.

• Gujarat Government announces new residential township policy

Recently
Gujarat
Government
announced
“Regulations
for
Residential
Townships
–
2009”.
Under
the
regulations,
all
private
developers
who
can
be
an
individual,
a
registered
cooperative
society,
an
association,
a
firm,
a
joint
venture,
an
institution
or
a
company
will
have
to
purchase
at
least
40
hectares
of
land
to
build
a
residential
township
in
the
areas
falling
under
the
urban
development
authorities
of
Ahmedabad,
Surat,
Vadodara,
Rajkot,
Gandhinagar,
Bhavnagar
and
Jamnagar.
In
the
case
of
other
towns
and
relevant
urban
authorities,
the
developers
will
need
to
purchase
minimum
20
hectares
of
land
for
such
townships.
The
regulation
allows
maximum
Floor
Space
Index
(FSI)
at
1.5.
Besides
the
permissible
1.0
FSI,
the
additional
0.5
FSI
will
be
allowed
on
the
payment
of
charges
based
on
jantri
rates.

• DIPP to scan FDI use in realty

The
Department
of
Industrial
Policy
and
Promotion
(DIPP)
has
set
up
a
Fresh Demand Trends for Top Six Cities - monitoring
cell
to
investigate
the
end-use
of
foreign
funds
raised
by
realty
firms.
Commercial Office Space The
objective
is
to
ascertain
diversion
of
money
in
banned
areas
like
agricultural
13.1
land
etc.
Under
current
regulations,
Foreign
Direct
Investment
(FDI)
is
banned
in
11.9
agriculture
and
agriculture-related
activities.
However,
100
percent
FDI
is
9.7
allowed
for
integrated
townships
and
housing
development
projects.
7.1 Revival
6.4
5.4
3.8 • Falcon Realty planning to expand in Bihar
Gurgaon-based,
Falcon
Realty
Services
is
planning
to
build
affordable,
eco-
friendly
housing
projects
in
Bihar
after
receiving
positive
response
for
such
1QCY08 2QCY08 3QCY08 4QCY08 1QCY09 2QCY09 3QCY09
projects
in
National
Capital
Region
(NCR).
The
company
is
likely
to
target
Patna,
Note:
Top
six
cities
include
-
Mumbai,
NCR,
Bangalore, Muzaffarpur
and
Purnia
for
its
projects.
The
company
has
already
identified
land
Chennai,
Hyderabad
and
Pune for
these
ventures
and
is
holding
talks
with
the
state
authorities
for
acquisition
Source:
Industry
Update,
Nomura,
11
November
2009 of
200
acre
for
each
of
the
three
projects.
The
estimated
cost
of
the
projects
is
USD
64
million.

• Returning NRIs boost demand for residential property

According
to
World
Bank
report
on
Migration
and
Development
Relief,
an
estimated
25
million
non-resident
Indians
(NRIs)
living
in
130
countries
have
so
far
remitted
USD
52
billion
followed
by
China
and
Mexico.
A
substantial
portion
of
the
NRI
investment
was
directed
towards
Indian
real
estate.
Southern
cities
in
particular
Bangalore,
Chennai
and
Hyderabad
are
driving
the
demand
though
minimal
level
demand
exists
for
other
cities
as
well.
Most
of
the
NRIs
keen
to
invest
in
real
estate
back
home
are
looking
for
home
loans
as
they
are
unable
to
get
loans
locally
due
to
the
current
tight
liquidity
situation
across
US.

Analyst: Rajiv Parekh

©
2010
KPMG,
an
Indian
Partnership
and
a
member
firm
of
the
KPMG
network
of
independent
member
firms
affiliated
with
KPMG
International
Cooperative
(“KPMG
International”),
a
Swiss
entity.
All
rights
reserved.
 Page 14 of 19

Telecom
• MNP by March 2010
The
government
has
announced
that
it
will
introduce
Mobile
Number
Portability
on
March
31,
2010
all
across
the
country.
There
has
been
a
three
month
delay
in
case
of
the
metros
where
MNP
was
to
be
launched
by
December
31,
2009.
The
delay
was
caused
because
some
of
the
operators
were
not
prepared
to
implement
MNP,
especially
the
state-owned
operators,
BSNL
and
MTNL.
Another
reason
for
the
delay
was
that
Telecordia,
which
owns
74
percent
stake
in
MNP
Interconnection,
one
of
the
companies
responsible
for
the
implementation
of
MNP
in
India,
is
said
to
have
implemented
MNP
in
Pakistan
as
well.
This
raised
security
concerns
for
the
Home
Ministry.

• DoT to impose USD 28.35 million penalty on telcos

DoT
has
imposed
a
combined
penalty
of
USD
28.35
million
on
some
of
the
major
telecom
operators,
for
failure
of
rolling
out
services
on
time.
These
have
been
imposed
in
the
form
of
liquidated
damages.
Amongst
the
offenders
included
are
Airtel
(USD
6.06
million),
Reliance
(USD
4.26
million),
Tata
Teleservices
(USD
6.06million),
Tata
Teleservices
Maharashtra
(USD
0.80
million)
and
Aircel
(USD
6.23
million).
On
the
other
hand
players
like
BSNL,
MTNL
and
Vodafone
have
not
been
imposed
with
a
fine.

• 3G auctions to start on February 13, 2010

“Going forward, the rural sector
will be a prime focus area as the
industry spreads its reach into the
entrails of bucolic India on the
back of customised applications
that not just add to the quality of
The
long
awaited
3G
auctions
have
been
delayed
again
and
are
scheduled
to
take
place
on
February
15,
2010.
The
delay
has
been
caused
because
DoT
was
not
able
to
finalize
the
details
of
the
Notice
Inviting
Applications.
The
process
is
likely
to
take
another
five
weeks
post
the
Notice
Inviting
Applications.
DoT
has
set
January
10,
2010
as
the
date
for
issuing
the
Notice
Inviting
Applications.
These
applications
will
be
accepted
only
uptill
January
25
and
the
mock
auction
will
be
held
on
February
10
and
the
final
auctions
on
February
13.
The
government
has
announced
that
it
will
be
auctioning
four
slots
of
the
spectrum
inspite
of
there
being
a
spectrum
crunch
and
has
also
announced
that
the
spectrum
will
be
allotted
to
all
players
in
August
2010
to
ensure
a
level
playing
field.

life, but to livelihoods, too”

• GTL to buy Aircel’s Towers
Anil Sardanai, MD, Tata Teleservices
(Source: The Financial Express, The Rural Consumer,
December 31, 2009)
GTL
Infrastructure,
a
company
that
lease
out
towers
to
telecom
operators
announced
that
it
has
agreed
to
buy
out
Aircel’s
tower
business
for
an
amount
of
USD
859
million
in
an
all
cash
deal.
As
per
the
deal,
GTL
will
add
17,500
of
Aircel’s
existing
towers
to
its
portfolio
and
later
an
additional
20,000
which
are
in
the
process
of
being
setup.
The
deal
value
however
is
USD
1.83
billion
as
GTL
will
also
be
taking
a
debt
of
USD
858
million
existing
in
the
books
of
Aircel.
GTL
will
be
acquiring
the
related
broadband
infrastructure
as
well.

• Average urban teledensity crosses 100 percent mark

The
latest
figures
revealed
by
DoT
indicate
that
the
average
urban
teledensity
across
the
country
has
breached
the
100
percent
mark.
This
implies
that
all
the
metros,
towns
and
cities
which
have
been
demarcated
by
the
government
as
urban
have
as
many
mobile
connections
as
people.
This
figure
was
hovering
around
60
percent
in
March
2008.

Analyst: Neha Dayal and Rishabh Chadha

©
2010
KPMG,
an
Indian
Partnership
and
a
member
firm
of
the
KPMG
network
of
independent
member
firms
affiliated
with
KPMG
International
Cooperative
(“KPMG
International”),
a
Swiss
entity.
All
rights
reserved.

“The year 2009 has been an
eventful and tumultuous year for
the civil aviation sector
worldwide. We can draw
satisfaction from the fact that the
worst is over. Things are turning
for the better, which is borne out
by the rebound in air traffic figures
from October onwards”
Praful Patel, Civil Aviation Minister - India
(Source:Times of India, Worst over for global aviation
industry: Praful Patel, December 29, 2009)
Analyst: Nitin Dehadraya
Page 15 of 19
Transport and Logistics
• RIICO to develop logistic park
The
Rajasthan
State
Industrial
and
Investment
Corporation
Limited
(RIICO)
has
signed
an
MoU
with
Container
Corporation
of
India
Limited
(Concor)
to
set
up
a
multi-model
logistic
park
(MMLP)
in
the
state
with
an
investment
of
about
USD
74.75
million.
The
logistics
park
is
to
be
developed
on
an
area
of
250
acres
and
is
expected
to
be
completed
in
about
36
months.
RIICO
is
looking
at
this
project
in
order
to
benefit
from
the
Delhi-Mumbai
Industrial
Corridor
of
which
40
percent
is
to
pass
through
Rajasthan.
• Mahindra Invests in Aerospace
Mahindra
Systech,
the
component
arm
of
Mahindra
&
Mahindra,
along
with
Kotak
Private
Equity
has
acquired
75.1
percent
stake
in
Aerostaff
Australia
(AA)
and
Gippsland
Aeronautics
(GA),
Australia-based
aerospace
companies.
AA
is
in
the
business
of

manufacturing
high
precision
close-tolerance
aircraft
components
and
assemblies
for
companies
such
as
Boeing
and
Airbus,
while
GA
manufactures
2-20
seater
aircraft
and
turboprop
engines.
The
company
is
planning
to
set
up
a
plant
at
Mallur
with
the
help
of
AA
to
manufacture
components
and
to
sell
in
the
Indian
market
and
AA
and
GA.

• Aegis Logistics acquires Shell Gas (LPG) India
Aegis
logistics
has
acquired
LPG
business
of
Shell
Gas
India.
The
acquisition
is
expected
to
give
Aegis
a
in
the
industrial
and
commercial
segments
and
an
entry
into
the
cylinder
market.
Shell
Gas
currently
own
a
terminal
at
Pipavav
Port
and
a
filling
plant
at
Kheda
which
would
now
be
under
Aegis’
control.
• Policy on Ground Handling Deferred
The
airport
ground
handling
policy
which
was
expected
to
be
effective
from
January
1,
2009
has
been
deferred
again
by
the
Civil
Aviation
Ministry.
As
per
the
proposed
policy
the
private
carriers
would
not
be
allowed
to
carry
out
their
own
ground
handling
activites
at
Mumbai,
Delhi,
Chennai,
Bangalore,
Hyderabad
and
Kolkata
airports
and
have
to
be
handled
only
by
subsidiaries
of
Air
India,
airport
operators
and
service
providers,
selected
through
competitive
bidding
at
the
airports.
The
policy
is
being
opposed
by
private
carriers
on
the
concern
that
at
least
10,000
employees
could
become
jobless
and
also
have
to
incur
higher
costs
if
these
activities
are
given
to
new
handlers.

• DIESL plans foray into SE Asia in next six months
Drive
India
Enterprise
Solutions
(DIESL),
a
Tata
group
company
providing
logistics
services,
is
planning
to
enter
the
South-East
Asian
market
in
the
next
six-months.
It
is
also
planning
to
acquire
mid-sized
logistics
firms
as
a
part
of
their
business
expansion
plans.
It
is
also
expected
to
expand
its
business
in
China,
the
US
and
Africa.

©
2010
KPMG,
an
Indian
Partnership
and
a
member
firm
of
the
KPMG
network
of
independent
member
firms
affiliated
with
KPMG
International
Cooperative
(“KPMG
International”),
a
Swiss
entity.
All
rights
reserved.
 Page 16 of 19

Reference material for preparing this document was taken

from the following sources:

Note:
1
USD=
46.6
INR
Sources
Foreword:
• The
Economic
Times,
The
three
positives
for
Indian
economy,
January
3,
2010.
• The
Economic
Times,
Industrial
output
at
2-year
high,
January
13,
2010.

Economy:
• The
Economic
Times,
Economy
to
Grow
8
Percent
in
FY
11:
Adviser
Says,
January
2,
2010
• The
Economic
Times,
Food
Inflation
at
11
Year
High,
Veggies
Cool,
January
1,
2010
• The
Economic
Times,
Food
Price
Index
Up
19.83%
Y/Y
on
December
19,
December
31,
2009
• Asia
Pulse,
India
5%
GDP
Forecast
for
2009-10
May
be
Revised
Upward,
December
01,
2009
• LiveMint,
India’s
Exports
Up
after
14
Months,
Grow
18.2%
in
Nov,
January
1,
2010,
• The
Economic
Times,
Mineral
Sector
Grows
by
Over
8
Percent
in
Oct
2009,
January
4,
2010

Auto
• Business
Line,
Mitsubishi
drives
away
from
Eicher
Motors,
December
4,
2009
• Auto
Business
News,
VW
and
Suzuki
to
develop
hybrid
and
electric
car
in
India,
December
31,
2009
• Auto
Business
News,
Volvo
Bus
India
to
launch
hybrid
buses
in
India,
December
29,
2009
• Dow
Jones
International
News,
Fuji
Heavy
Industries
To
Enter
India
Car
Market
2011
–
Report,
December
3,
2009

BFSI:
• The
Economic
Times,
Kotak
ties
up
with
Russia's
top
I-bank
for
M&A
advisory
services
in
CIS,
Africa,
December
16,
2009

• Economic
Times,
Indiabulls
is
planning
to
foray
into
infra
financing
business
segment,
December
18,
2009

• Business
Standard,
ICICI
Bank
planning
to
raise
capital
through
Tier
I
and
Tier
II
bonds,
December
26,
2009
• Financial
Express,
OBC
plans
open
offices
in
Hong
Kong,
Africa,
December
20,
2009

• Business
Standard,
DCB
is
planning
to
foray
into
wealth
management
space,
December
10,
2009

CM:
• Times
of
India,
Marico
acquires
Colgate-Palmolive's
'Code
10'
brand,
January
04,
2010
• The
Economic
Times,
Marks
&
Spencer
to
scale
up
India
operations,
December
14,
2009
• Financial
Express,
Gucci
can
open
single-brand
stores
in
India,
December
04,
2009
• Fnbnews.com,
South
Africa’s
News
Café
sets
shop
in
India,
December
23,
2009
• The
Economic
Times,
Essar’s
telco
retail
arm
acquires
X-Cite,
December
09,
2009

Hospitality:
• Business
Standard,
Lalit
Suri
Group
plans
foray
into
economy
segment,
December
28,
2009

• The
Economic
Times,
Videocon
to
enter
hospitality
biz,
set
up
hotel
at
Salt
Lake,
December
26,
2009
• The
Economic
Times,
Zuri
plans
to
build
two
hotels,
invest
Rs
400
crore,
December
11,
2009
• Business
Standard,
Sahara
Hospitality
to
build
1000
rooms,
December
01,
2009

• The
Statesman,
IHC
plans
Rs
1000
crore
fund,
November
06,
2009

©
2010
KPMG,
an
Indian
Partnership
and
a
member
firm
of
the
KPMG
network
of
independent
member
firms
affiliated
with
KPMG
International
Cooperative
(“KPMG
International”),
a
Swiss
entity.
All
rights
reserved.
 Page 17 of 19

IT:
• The
Hindu
Business
Line
,
HCL
Axon
services
for
GlaxoSmithKline,
December
18,
2009
• Hindustan
Times,
IBM
bags
INR
380-cr
deal
from
Digicable,
December
22,
2009
• The
Financial
Express,
Interglobe
opens
BPO
centre
in
Manila,
hires
350,
December
30,
2009
• The
Economic
Times,
HCL
Tech
bags
5-year
multi
million
pound
deal
from
News
Corp
arm,
December
8,
2009
• The
Economic
Times,
Wipro
to
provide
testing
services
to
Telefonica
O2
Germany,
December
18,
2009
• The
Economic
Times,
IT
services
market
set
to
double
by
2013:
Report,
December
24,
2009

Media:
• MediaNama.com,
Reliance
MediaWorks
To
Set
Up
JV
With
In-Three,
December
08,
2009

• IndianTelevision.com,
Sri
Adhikari
Bros
plans
to
launch
regional
channels,
December
12,
2009

• IndianTelevision.com,
Digicable
to
up
its
stake
in
CableComm
to
80,
December
26,
2009
• Financial
Express,
MSM
to
launch
a
sports
channel,
December
23,
2009
• Asia
Pulse,
Indian
Console
Gaming
Market
To
Touch
US$122
mn
In
2010,
December
23,
2009

Oil and Gas:

• The
Hindu
Business
Line,
OVL
to
bid
with
Repsol,
Petronas
for
Venezuelan
fields,
December
22,
2009
• The
Hindu
Business
Line,
Fertiliser
industry
seeks
more
gas
allocation,
December
24,
2009
• Business
Standard,
RIL
tests
peak
output
capacity
of
KG
fields,
December
28,
2009

Pharma:
• Company
Website,
Hospira
to
Acquire
Orchid's
Generic
Injectable
Pharmaceuticals
Business,
December
15,
2009
• Business
Standard,
Dishman
pharma
forms
JV
to
make
API
in
Saudi
Arabia,
December
10,
2009
• in-pharmatechnologist.com,
Dishman
partners
for
Saudi
API
making
JV,
December
17,
2009
• Business
Standard,
Intas
Pharma
ties
up
with
US
company,
December
2,
2009
• Company
Press
Release,
Daiichi
Sankyo
to
leverage
Ranbaxy’s
presence
in
Africa
for
marketing
and
distribution,
December
21,
2009

Power:
• Business
Standard,
1,200-Mw
Rosa
project
starts
in
UP,
December
29,
2009
• The
Economic
Times,
Indo-Bhutan
power
MoU,
December
24,
2009
• The
Telegraph,
Big
power
projects
on
track,
December
29,
2009
• The
Economic
Times,
Power
plants
may
get
to
sell
unallocated
output,
December
23,
2009

Real Estate:
• Business
Standard,
Maha
realty
to
cost
more
with
new
ready
reckoner,
January
02,
2010
• DNA
India,
Realtors
mull
pulling
back
from
townships,
December
05,
2009
• The
Financial
Express,
DIPP
to
scan
FDI
end-use
in
realty,
December
18,
2009
• The
Financial
Express,
After
NCR,
Falcon
Realty
sets
sights
on
Bihar,
December
26,
2009
• The
Economic
Times,
Returning
NRIs
boost
demand
for
residential
property,
December
09,
2009

©
2010
KPMG,
an
Indian
Partnership
and
a
member
firm
of
the
KPMG
network
of
independent
member
firms
affiliated
with
KPMG
International
Cooperative
(“KPMG
International”),
a
Swiss
entity.
All
rights
reserved.
 Page 18 of 19

Telecom:
• Financial
Chronicle,
Mobile
number
portability
by
March
2010,
December
31,
2009;
Business
Standard,
MNP
to
be
delayed;
DoT
calls
meeting
tomorrow,
December
16,
2009
and
The
Economic
Times,
Number
portability
hits
home
ministry
hurdle,
December
17,
2009
• Business
Standard,
DoT
to
impose
Rs
132-cr
penalty
on
telcos,
December
31,
2009
• The
Hindu
Business
Line,
3G
spectrum
auctions
likely
from
Feb
13,
December
31,
2009;
Business
Standard,
3G
auction
may
start
by
Feb
end
or
March
1st
week,
December
28,
2009
• The
Economic
Times,
GTL
to
buy
Aircel's
towers,
December
24,
2009
• The
Economic
Times,
Average
urban
teledensity
crosses
100%
mark,
December
12,
2009

Transport and Logistics:

• Economic
Times,
‘RIICO
inks
pact
with
Concor
for
logistic
park’,
December
24,
2009
• DNA,
‘Mahindra
buys
two
Aussie
aero
cos’,
December
16,
2009
• Economic
Times,
‘Aegis
Logistics
acquires
Shell
Gas
(LPG)
India’
December
21,
2009
• Livemint,
‘Policy
on
ground
handling
being
deferred
again’,
December
30,
2009
• The
Hindu
Business
Line,
DIESL
plans
foray
into
SE
Asia
in
next
six
months,
Dec
20,
2009

©
2010
KPMG,
an
Indian
Partnership
and
a
member
firm
of
the
KPMG
network
of
independent
member
firms
affiliated
with
KPMG
International
Cooperative
(“KPMG
International”),
a
Swiss
entity.
All
rights
reserved.
 in.kpmg.com

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Research
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2010
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