Nokia's tax woes: Delhi HC adjourns hearing to Apr 17

The Delhi High Court today posted on April 17 the hearing on a plea of mobile phone maker Nokia India Private ltd against a demand notice of over Rs 2,000 crore served on it by the Income Tax department for alleged evasion of taxes in its transactions here.

A bench of justices Badar Durrez Ahmed and R V Easwar, which had earlier stayed the operation of the notice till April 19, today deferred the hearing to April 17.

Also read: Nokia launches cheapest entry level handset in India

The Indian subsidiary of the Finnish mobile phone maker, on March 21, was served with the IT notice asking it to pay over Rs 2,000 crore for alleged evasion of taxes in its business transactions in the country.

The company then moved the court which had on March 22 granted the interim stay on the operation of the demand notice and asked the I-T department to file its reply.

The alleged tax evasion pertains to royalty payment made against supply of software by the company's parent company which attracts a 10 per cent tax deduction under the Tax Deducted at Source (TDS) category, sources at I-T department had said.

The department has analysed the company's business statements since 2006, they said.

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Walmart probe committee asks for more details

The Walmart probe committee headed by Justice Mukul Mudgal may seek an extension of time to finalise its report. The committee is investigating if Walmart paid any bribes or violated laws to get entry into the Indian market CNBC-TV18's Malvika Jain reports.

Also read: India wants Walmart to reply on lobbying charges by April 9

The Justice Mukul Mudgal probe panel on Walmart met on Wednesday to discuss the recent submissions by Walmart executives including Asia CEO Scott Price and India head Raj Jain. Justice Mudgal told CNBC-TV 18 that the panel had sought further clarifications from the company.
Mukul Mudgal, head, Walmart Probe Panel says, " We discussed the reply given by Walmart and have decided to send some supplementary questions and after the supplementary questions are received we will formulate over report. and given the size of the task, the committee may well seek an extension.  If at all a little extension is sought it wont be beyond June."

Last year, Walmart had disclosed that since 2008 it had spent approximately Rs 125 crore on lobbying activities related to its India entry. Presently, Walmart is operating in India through a joint venture with Sunil Mittal's Bharti Enterprises.

In a statement to CNBC-TV18, Walmart had said, " Under US law, on a quarterly basis, all companies which meet certain time and expenses thresholds, are required to disclose issues and expenditures spent in connection with contacts with the United States government, including staffing cost, association dues, and payments to consultants. This is not unique to Walmart."

Whether Walmart has violated any Indian law or not will be known once Justice Mudgal submits his final report.

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Apollo Tyres targets new emerging markets

The country's larger tyre manufacturer Apollo Tyres is looking to agressively drive into new emerging markets as growth in its core markets of India, Europe and South Africa stagnate.

The company has identified a new manufacturing plant in South-east Asia and hopes its international business will contribute over 60% of total turnover in the next five years. CNBC-TV's Ronojoy Banerjee spoke to Neeraj Kanwar, managing director and vice chairman of the company to understand the change in strategy. 

Also read: Buy Apollo Tyres on dips: Ajay Srivastava

As part of this new strategy. the company will reduce India's share to its total turnover by nearly half in five years. Kanwar says, "India's share of turnover through exports has been around 65%.We are now working towards increasing the focus of overseas markets such that the total share will go up to 60%."

To increase focus on new emerging markets of Asean and Latin America, Apollo will invest around USD 500 million in a new manufacturing plant in Thailand. Kanwar says, "We have identified Thailand for a new project. The plant will be modelled like our Chennai plant. In the first phase we will make bus and passenger vehicle tyres."

Apollo Tyres has also decided to put its QIP plans on hold for the time being. Kanwar says, " We have put QIP on hold.  We have a one-year window and we will take a call on it later." With heavy investments lined up in the pipeline over the next five years, Kanwar will face the challenge of lowering the company's debt, which currently stands at around Rs 2200 crore for its India operations. But for now the management is not particularly perturbed.

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Cabinet likely to discuss coal price-pooling next week

The Cabinet is likely to meet again next week to discuss pooling the price of imported coal with the domestic fuel. "The Cabinet Committee on Economic Affairs (CCEA) may meet on April 16 to discuss coal price-pooling," a source said.

Also Read: GoM on draft coal regulator Bill may meet on Wednesday

Finance minister P Chidambaram had said last week that the Cabinet will take a view on price-pooling of coal to address the fuel supply issue. Price-pooling is the averaging of prices of domestic and imported coal to get a uniform feedstock price in the country.

On the directions of the CCEA, an inter-ministerial panel was formed under the chairmanship of coal secretary SK Srivastava to looking into price pooling and coal linkages issue. The Cabinet had asked the coal ministry to back on the issue within five weeks, according to sources.

The CCEA had in February approved in-principle coal price pooling but had asked coal and power ministries to come back with specifics of the proposal.

The Prime Minister's Office had directed Coal India Ltd (CIL) and Central Electricity Authority (CEA) in 2012 to work on price-pooling, so as to ensure 80 per cent supplies to power plants.

However, the final decision on the issue was pending for long due to differences between the coal and power ministries on how the impact of higher imported coal prices will be shared between CIL and power companies.

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Aditya Birla Nuvo to sell carbon black biz to group firm

Aditya Birla Nuvo today said it will sell its carbon black business to another group firm SKI Carbon Black (India) for Rs 1,451 crore.

The move, aimed at reducing debt, follows a decision of the company's Committee of Directors who felt that it will be "extremely challenging" for Nuvo to become a global leader as multi-national tyre makers prefer tie-ups with firms which has global spread. 

Nuvo, which had clocked Rs 1,983 crore revenue in FY'12, has three plants for making carbon black, used in tyre making and is among country's top three firms in the business.

Globally, however, its share is minuscule at 2 per cent. The company has presence in finance, telecom and textile business, among other areas. 

"The Committee of Directors of the Company at its meeting held on April 6, 2013 has...decided to divest Carbon Black Business, on a going concern basis, by way of slump sale to SKI Carbon Black (India), an Aditya Birla Group Company, for a lump-sum consideration of Rs 1,451 crore as enterprise value," the diversified firm said in stock exchange filing. 

"Moreover, in view of the company's capital commitment towards funding the growth of its other businesses, it is extremely challenging for the Company to become a global carbon black player," the filing said. 

The sale is subject shareholders and other approvals, it said, adding that the valuation of the business has been done by Deloitte Touche Tohmatsu India.

"The cash inflow from the divestment of the carbon black business will reduce debt and strengthen the company's balance sheet. This will support growth plans and ensure greater focus on the other businesses of the company," it said. 

Aditya Birla Nuvo's net debt to equity ratio stood at 0.66 and net debt to annualised EBITDA at 4.2 as on September 30, 2012.

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HC to hear tomorrow Tata's plea over Taj Mansingh property

HC to hear tomorrow Tata's plea over Taj Mansingh property

The Delhi High Court would take up tomorrow the injunction suit filed by Tata Group's Indian Hotels Company (IHC) against NDMC's proposed plan for auctioning the property on which the Taj Mansingh hotel is located here.

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SBI planning to open upto 100 branches in AP

A top official of State Bank of India today said it was planning to open upto 100 new branches in Andhra Pradesh this financial year.

Speaking to reporters after inauguration a branch at Mindi on the outskirts of the city, SBI Chief General Manager Rakesh Sharma also said branches would be opened in semi-urban, urban and metros, to compete with private banks.

Also read: Q4 NPAs lower, positive on agri portfolio: SBI Chairman

SBI's deposits in the state stood at Rs 59,800 crore and advances at Rs 61,500 crore, he said, adding that the bank was focusing on housing loans. "Our interest rates are the lowest, many customers are transferring their housing loans to SBI.

Our present market share in housing loan is 28 percent. We want to increase it to 40 percent," he said.

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JK Lakshmi Cement: C'garh plant work on despite vandalism

JK Lakshmi Cement today said it would go ahead with plans to set up Rs 1,500-crore plant in Durg district of Chhattisgarh even as the under-construction facility was damaged by some local villagers this week.

The cement maker has "reiterated commitment" to complete the 2.7 million tons grenfield plant "with an investment of over Rs 1,500 crore" at Ahiwara village in Durg district, JK Lakshmi Cement said in a statement.

The statement said that on Thursday "miscreants with vested interests, illegally" entered at the plant site with malafide intentions and caused serious damages at the construction site, which was at an advanced stage of completion.

Hundreds of local villagers had set on fire a portion of the under-construction plant, angered by the company's reported reluctance to give jobs to project-affected persons. "The agitation has been on for over a month now and those involved have been disrupting work of an on trying to delay and disrupt work at the construction site. The local villagers have been seeking job for all irrespective of their skills and abilities," the company said.

"Senior Directors of JK Lakshmi Cement are on ground since yesterday supervising the complete situation. The damage done by act is being ascertained and quoting any figure at this stage would be misleading as it would easily take about a week to determine the exact loss," it said.

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Will management rejig be a game changer for Groupon?

From being Forbes' fastest growing company ever to registering one of the worst IPO runs since the dot com debacle, Groupon, the big daddy of deals on the internet has seen it all in just five years.

The company is now desperately trying to reinvent itself and win back investor confidence. The group buying deals and discount site hasn't has had a good start to the year. Founder, CEO Andrew Mason was finally asked to go by the board and the stock is being punished by Wall Street.

Also read: A trimmer, sharper Groupon seen in the post-Mason era

Kal Raman, tipped to be one of the frontrunners for the CEOs job and the current COO of Groupon was in India to launch the firm's first R&D centre for the Asia-Pacific region in Chennai.  An aluminous of the Guindy Engineering College in Chennai, Raman is a 20-year veteran in technology and retail.

After having worked with Amazon, as well as turning entrepreneur with his tech start-up GlobalScholar.com, Raman joined Groupon in 2012 as senior vice president global sales and operations, and today faces the biggest test of his career. 

Talking to CNBC-TV18, Raman said, "Groupon is probably the most misunderstood company I have ever been part of. Whatever you said, about repeated missing of earnings, and the stock being 80 percent of the IPO price - they are all very correct and truthful statements. So, first, Groupon is not building a company, it is building a category. Local e-commerce as a category never existed four years back." 

In 2011, this company did approximately USD 3.5 billion in billings and lost USD 220 million. In 2012, it did USD 5.4 billion in billings and made a profit of USD 98 million, and the balance sheet has grown every quarter since the company went public. 

The company's US business as been fully operational for three to four years, while majority of its international business has been around only for two years. "So, you are talking about an end company which is trying to grow and trying to forecast, predict and do all the right things like a mature company. That is where we kind of had mis-steps and we have being doing things wrong," he added.  

"To me, the single biggest advantage of going public is basically telling the world a category or a company has come which never existed before."  Eric who is the current interim CEO and Ted Leonsis have been working together as a team for the last three to four years.

Eric, being an executive chairman, has been involved in the details of every major decision Groupon has made. Ted Leonsis, a veteran in many industries, he has been giving input on all important matters.

"So, it is more of a team. Groupon is a company which is not about individuals, it is about a company. The true ecosystem which surrounds the company in our case are the merchants, the customers and the shareholders - no one person is indispensable be it Andrew or me or anybody. So, either we all feel the heat or we are all chilling out," Raman says. 

Explaining the company's strategy, he says "Unlike many other companies, Groupon is not a company which needs a CEO to change the strategy or turn the company around, making decisions in a different way then what we made in the last nine months."

"We have been violently in agreement with what should happen with Groupon and we focus more on controlling the controllable which is all about merchant experience and customer experience. Who the leader is, is kind of immaterial because the leadership is totally aligned in building long-term shareholder value by putting the merchants and customers first." 

The recently launched Chennai R&D centre is amongst the five global R&D centres that Groupon has. There are currently less than 200 people and this centre would play a role in helping with the expansion in India and rest of the Asia-Pacific countries.

The company does more than 40 percent of its business in mobile phones worldwide. It is one of the very few companies which has got more than 25,000 downloads in the US, which is still rated 5 star. "We need to get better in Android and the remaining Symbian and Nokia operating systems," Raman says.

Groupon came into India by acquiring SoSasta.com, and is looking at merger and acquisition (M&A) possibilities even now.

"The moment we get something, if we believe that is the best use to use our balance sheet to enhance shareholders value that would be the first thing we would do," says Raman. 

Talking about the road ahead for Groupon and future plans, Raman says, "If you consider what we are doing is a marathon, we are not even in the first mile. We are trying to change customer and merchant behaviour. It is a USD 3 trillion opportunity, and we don't event have 50 basis point of the total opportunity. 5-10 years down the road there is no reason why local e-commerce should not be 15 percent of local commerce. "

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China keen on investing USD 3bn in new Mumbai metro project

The Chinese government is ready to pump in upto USD 3 billion into a proposed metro project connecting Colaba in south Mumbai to Santacruz in the northern fringe of the megapolis, a top government official said on Saturday.

The Chinese are also keen on participating in other infrastructure projects apart from those in the agriculture sector in the country, the official said. "We are keen to bring our technology for the new metro project in Mumbai. We are also ready invest in technology upgrade for the textiles sector, infrastructure and agriculture projects in the country," Chinese Consul-General in Mumbai Liu Youfa told PTI.

He said they are "willing to invest USD 3 billion in the metro project through foreign investments along with latest technology." The feasibility study on the proposed Colaba-SEEPZ (Santacruz Electronic Export Processing Zone at Andheri) metro project is ready and the Maharashtra government is looking for technology and funding for the venture.

Liu claimed China was already providing magnetic and bullet-train technology to over 30 countries. Indian Merchants Chamber president Niranjan Hiranandani, who was also present at the event, said the industry body will do everything to help attract Chinese investment into the infrastructure projects in Mumbai.

"We need to work on two-way investment which will reduce the trade deficit on Indian side and create more jobs," Liu said. The trade between the two Asian giants stood at USD 73.9 billion in 2011 and dropped marginally to USD 70 billion in 2012 due to economic slowdown, he said.

The Consul General, an economist by training, spoke on further developing relations between India and China. "Together, the two countries comprise 37 percent of the world's population. If we both come together, nobody can stop our growth. However, if one of us focuses individually on growth, it's going to hinder the other," Liu said and called for for more bilateral trade and investment.

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