DLF Brands is winding up its joint venture with Italian leather and luggage accessories major Piquadro to open a chain of monobrand stores in the country. The development comes even as real estate giant DLF’s retail management arm is resetting growth strategies following an economic downturn, and reviewing the expansion plans of a few international fashion and lifestyle brands it operates locally.
The 51:49 JV between Piquadro and DLF Brands was projected to open 16 exclusive stores by 2013. DLF has closed down the first high-end Piquadro store opened in New Delhi almost six months back and has dismantled an internal team working on the brand.
Timmy Sarna, CEO of DLF Brands, confirmed the closure of the existing Piquadro store. “Piquadro is a very sophisticated brand, which is much ahead of its time with regard to the Indian market. It had a higher price positioning than our other brands and was unable to garner enough brand recall,” he said, when contacted.
However, he added that DLF may revisit plans and introduce Piquadro with more stores in the next few years once the market is ready. Mr Sarna also denied that DLF was putting expansion plans on hold or reviewing the business strategy of a few other international partnerships with Italian apparel brand Alcott and French home decor retailer SIA. He added that the company was poised to open 15 odd new stores in the next few weeks across its brand portfolio. It operates a network of 20 stores currently.
DLF Brands had signed up a host of global brands in the premium-to-luxury segments over the last two years. This included high-profile JVs with Giorgio Armani, Salvatore Ferragamo and Dolce & Gabbana. Besides, it had also roped in brands like Alcott, Boggi, SIA, Sunglass Hut among others either through licensing deals or joint ventures.
This large portfolio had niche global brands with not-so-high brand recall in India. Sectoral observers said DLF Brands could be reworking its retail play and expansion plans of several brands in the wake of the changed economic climate. But its JVs with Giorgio Armani and Ferragamo were on firm ground even though fresh store openings are likely to be deferred in the prevailing conditions.
Wednesday, July 8, 2009
Merger between State Bank of India and State Bank of Indore
The State Bank of India (SBI) board has approved the merger of its subsidiary, the State Bank of Indore, with itself. This would be the second acquisition by SBI of a subsidiary bank after the merger of State Bank of Saurashtra. The State Bank of Indore board, too, has approved the merger proposal. SBI holds 98.3% in the bank, and the balance 1.77% is owned by individuals, who held the shares prior to its takeover by the government.
The acquisition of State Bank of Indore will help SBI add 470 branches to its existing network of 11,448. Also, following the acquisition, SBI’s total assets will inch very close to the Rs 10-lakh crore mark. Total assets of SBI and the State Bank of Indore stood at Rs 998,119 crore as on March 2009.
The country’s largest lender had in early 2007 announced its intention to merge all its seven associate banks with itself. The market had estimated that SBI would first merge the small unlisted banks. SBI holds 100% stake in State Bank of Hyderabad and State Bank of Patiala, and in the range of 75-98% in State Bank of Bikaner and Jaipur, State Bank of Indore, State Bank of Travancore and State Bank of Mysore.
For SBI, the acquisition of State Bank of Indore will mainly be an HR exercise. This is primarily because SBI and all its six associate banks share a common IT platform and follow similar policies. Further, even as treasuries of all the associate banks operate separately, they are situated in the same building in south Mumbai. Moreover, the associate banks already sell insurance policies of SBI Life and issue SBI credit cards.
“The timing of the approval indicates there is some level of comfort for SBI to go ahead with the plan of merging its associate with itself, given that the Left is out of the picture,” said Hemindra Hazari, head of equity research at Karvy Securities.
It may be recalled that the SBI board had approved the merger of State Bank of Saurashtra with itself sometime in August 2007, but could only complete the process by August 2008, after the Left had walked out due to differences over the Indo-US nuclear deal. In his first meeting with the CEOs of PSU banks, finance minister Pranab Mukherjee said consolidation was important to improve competitiveness among Indian banks.
The acquisition of State Bank of Indore will help SBI add 470 branches to its existing network of 11,448. Also, following the acquisition, SBI’s total assets will inch very close to the Rs 10-lakh crore mark. Total assets of SBI and the State Bank of Indore stood at Rs 998,119 crore as on March 2009.
The country’s largest lender had in early 2007 announced its intention to merge all its seven associate banks with itself. The market had estimated that SBI would first merge the small unlisted banks. SBI holds 100% stake in State Bank of Hyderabad and State Bank of Patiala, and in the range of 75-98% in State Bank of Bikaner and Jaipur, State Bank of Indore, State Bank of Travancore and State Bank of Mysore.
For SBI, the acquisition of State Bank of Indore will mainly be an HR exercise. This is primarily because SBI and all its six associate banks share a common IT platform and follow similar policies. Further, even as treasuries of all the associate banks operate separately, they are situated in the same building in south Mumbai. Moreover, the associate banks already sell insurance policies of SBI Life and issue SBI credit cards.
“The timing of the approval indicates there is some level of comfort for SBI to go ahead with the plan of merging its associate with itself, given that the Left is out of the picture,” said Hemindra Hazari, head of equity research at Karvy Securities.
It may be recalled that the SBI board had approved the merger of State Bank of Saurashtra with itself sometime in August 2007, but could only complete the process by August 2008, after the Left had walked out due to differences over the Indo-US nuclear deal. In his first meeting with the CEOs of PSU banks, finance minister Pranab Mukherjee said consolidation was important to improve competitiveness among Indian banks.
US ANTI-TRUST NOD has been granted to Tech Mahindra for Satyam Open Offer
As per TECH Mahindra news, they have got the approval from the US anti-trust authority regarding its Rs 1,154-crore open offer for the purchase of an additional 20% stake in Satyam Computer.
In a filing to the stock exchanges Tech Mahindra said, “Our request for early termination of the applicable waiting period relating to the offer has been granted under the Hart-Scott-Rodino Antitrust Improvements Act of 1976...”
Tech Mahindra further said, “The condition to the offer with respect to anti-trust approval under the Hart-Scott-Rodino Act has been satisfied.” The anti-trust approval in the US was needed as both the companies — Satyam and Tech Mahindra — have technology outsourcing work in the United States, and also because Satyam is listed on the NYSE.
The open offer has already got anti-trust approval from Germany’s competition regulator, the Federal Cartel Office, and India’s two premier bourses Bombay Stock Exchange and National Stock Exchange. Tech Mahindra had announced an open offer on April 22 for buying an additional 20% at a price of Rs 58 a share.
In a filing to the stock exchanges Tech Mahindra said, “Our request for early termination of the applicable waiting period relating to the offer has been granted under the Hart-Scott-Rodino Antitrust Improvements Act of 1976...”
Tech Mahindra further said, “The condition to the offer with respect to anti-trust approval under the Hart-Scott-Rodino Act has been satisfied.” The anti-trust approval in the US was needed as both the companies — Satyam and Tech Mahindra — have technology outsourcing work in the United States, and also because Satyam is listed on the NYSE.
The open offer has already got anti-trust approval from Germany’s competition regulator, the Federal Cartel Office, and India’s two premier bourses Bombay Stock Exchange and National Stock Exchange. Tech Mahindra had announced an open offer on April 22 for buying an additional 20% at a price of Rs 58 a share.
IVRCL INFRASTRUCTURES & PROJECTS on the move of getting the orders from IOCL & other vendors worth Rs 432.36 CR
As per information published by IVRCL Infrastructures & Projects, they have bagged contracts worth Rs 432.36 crore from different vendors, including Indian Oil Corporation, for construction-related works. The company has received an order worth Rs 144.56 crore from Coastal Gujarat Power. The project is scheduled to be completed in 18 months and two orders aggregating Rs 81 crore from Uttar Pradesh Rajkiya Nirman Nigam, IVRCL said. The infrastructure firm has also received a Rs 46.54-crore order from IOC for construction of quarters, estate office at Paradip and a Rs 21.51-crore order from Hindustan Dorr-Oliver.
Lending rates for home loan customer has been reduced by SBI for first 3years
STATE Bank of India has launched two special home loan schemes that assure low interest rates in the first three years, upping the ante for its rivals in the mortgage market, which has turned bullish following a pickup in home sales in May.
HDFC is yet to take any action in this matter as the budget has already been passed in parliament. ICICI Bank said it has already reduced interest rates in line with the movement of systemic rates and deposit costs. “We believe that the home loan segment has robust potential and we would continue to focus on this segment,” said an ICICI Bank spokesperson. LIC Housing Finance—the second-largest mortgage finance company—has also reduced home loans for existing borrowers by 50 basis points.
The intensity of the competition between SBI and HDFC is evident from claims and counter-claims from both sides on the superiority of their product. “Even if the borrower gets a better deal for the first three years, his payment over the remaining tenure of the loan will be lower under an HDFC loan,” said HDFC joint MD Renu Karnad. The institution’s chairman, Deepak Parekh, had recently announced a possibility of lending rates coming down if there is a decline in cost of funds.
According to Ms Karnad, there has been a remarkable pickup in home sales. “We are seeing this because of a real reduction in property prices. Builders like Unitech and Lodha have brought down rates in Delhi and Mumbai and are seeing growth in sales.” She added that the pickup in sales was so sturdy that prices have started picking up again—a perception echoed by SBI. “There is a definite pickup in home purchases partly driven by a fall in cost of loans and real fall in property prices. There are pockets where the resurgence is so good that property prices have started picking up; it has come a full circle quickly,” said an SBI official. SBI has a home loan portfolio of over Rs 56,000 crore.
HDFC is yet to take any action in this matter as the budget has already been passed in parliament. ICICI Bank said it has already reduced interest rates in line with the movement of systemic rates and deposit costs. “We believe that the home loan segment has robust potential and we would continue to focus on this segment,” said an ICICI Bank spokesperson. LIC Housing Finance—the second-largest mortgage finance company—has also reduced home loans for existing borrowers by 50 basis points.
The intensity of the competition between SBI and HDFC is evident from claims and counter-claims from both sides on the superiority of their product. “Even if the borrower gets a better deal for the first three years, his payment over the remaining tenure of the loan will be lower under an HDFC loan,” said HDFC joint MD Renu Karnad. The institution’s chairman, Deepak Parekh, had recently announced a possibility of lending rates coming down if there is a decline in cost of funds.
According to Ms Karnad, there has been a remarkable pickup in home sales. “We are seeing this because of a real reduction in property prices. Builders like Unitech and Lodha have brought down rates in Delhi and Mumbai and are seeing growth in sales.” She added that the pickup in sales was so sturdy that prices have started picking up again—a perception echoed by SBI. “There is a definite pickup in home purchases partly driven by a fall in cost of loans and real fall in property prices. There are pockets where the resurgence is so good that property prices have started picking up; it has come a full circle quickly,” said an SBI official. SBI has a home loan portfolio of over Rs 56,000 crore.
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