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Sectoral Snippets India Industry Information Issue 25 - November 2008 KPMG IN INDIA

New SectorSnippets Issue 25:TP4 WhitePaper A4.QXD · 2008. 12. 2. · Page 2 of 16 Sectoral Snippets About Sectoral Snippets Sectoral Snippets is an India-focused, monthly, freely-distributable

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  • Sectoral SnippetsIndia Industry Information

    Issue 25 - November 2008

    KPMG IN INDIA

  • Page 2 of 16

    Sectoral Snippets

    About Sectoral Snippets

    Sectoral Snippets is an India-focused, monthly, freely-distributable newsletter brought out by

    KPMG in India. This newsletter provides an overview of the Indian economy in the form of

    news-briefs from across key sectors.

    Contact [email protected] if you are interested in receiving this newsletter on a

    regular basis, or wish to unsubscribe.

    Table of Contents

    1. Indian Economy 3

    2. Auto and Auto Components 4

    3. Banking and Insurance 5

    4. Consumer Markets and Retail 6

    5. Hospitality 7

    6. IT / ITeS 8

    7. Media 9

    8. Oil and Gas 10

    9. Pharma 11

    10. Power 12

    11.Real Estate and SEZs 13

    12.Telecom 14

    13.Transport and Logistics 15

    Sectoral Snippets, Issue 25

    The�significant�shift�in�the�global�macroeconomicscenario�over�the�last�couple�of�months�has�hada�ripple�of�effects�on�developing�economies�likeIndia.�These�include�corrections�in�capitalmarkets,�weakening�of�the�Indian�currency�andlower�consumption�and�manufacturing�output,resulting�in�a�downward�revision�of�GDP�growthestimates.�Inflation�on�the�other�hand,�hasdipped�to�approximately�8.9�percent�afterreaching�record�highs�earlier�this�year.�Withinflationary�expectations�lower�than�previouslypredicted,�Indian�policymakers�are�now�focusingon�fiscal�and�monetary�measures�in�order�to�aidgrowth.�

    In�other�developments,�Egyptian�PresidentHosni�Mubarak�visited�India,�during�which�bothnations�took�steps�towards�furthering�ties.�Egyptand�India�have�signed�5�agreements—includinga�MoU�pertaining�to�cooperation�in�trade—andtarget�USD�10�billion�in�bilateral�trade�by�2010.

    I�hope�you�find�this�edition�useful�andinformative.

    Regards,

    Russell

    Russell Parera

    Chief Executive Officer

    KPMG in India

    ©�2008�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.

  • India�has�been�increasingly�drawing�interest�of�the�global�economic�community

    due�to�its�strong�record�of�achieving�a�GDP�growth�of�over�9�percent�in�the�last�3

    financial�years.�The�economy�is�now�expected�to�grow�at�7.7�percent�in�2008-09.�

    However,�considering�the�recent�financial�crisis�which�broke�out�in�early�October,

    the�outlook�for�the�economy�could�suggest�further�moderation.�These�projections

    are�based�on�the�results�of�professional�forecasters’�survey�conducted�by�the

    Reserve�Bank�of�India�(RBI),�India’s�central�bank�in�2008.

    In�a�move�to�combat�the�current�credit�crisis,�the�RBI�cut�the�Cash�Reserve�Ratio

    (CRR)�to�5.5�percent�and�the�repo�rate�to�7.5�percent�in�October.�The�measure

    was�carried�out�to�inject�liquidity�into�the�domestic�financial�markets�so�as�to

    lessen�the�pressures�brought�on�by�the�weakening�of�the�global�financial

    environment.�As�a�result�of�this�reduction�in�the�CRR,�the�central�bank�hopes�to

    add�an�additional�liquidity�worth�USD�8.5�billion.�

    As�anxiety�looms�over�large�scale�job�cuts�in�the�wake�of�a�slowing�industrial

    output,�the�cut�in�CRR�rates�has�been�welcomed�in�the�hope�that�commercial

    banks�would�lend�more�and�reduce�their�interest�rates�to�help�the�Indian�industry

    put�its�investment�plans�back�on�track.�This�move�is�also�expected�to�positively

    affect�the�home,�auto,�consumer�durables�and�corporate�loans�segments.�

    India’s�large�agricultural�sector,�strong�internal�consumption�demand�and�the

    saving�habits�are�the�several�inherent�strengths�that�could�allow�it�to�decouple

    from�the�rest�of�the�world�and�grow.�

    Policy�makers�are�confident�that�India�will�preserve�its�growth�momentum,

    although�a�shade�lower,�as�the�fundamentals�of�the�economy�are�strong.�To

    ensure�this,�India’s�policy�interventions�ought�to�be�well�drafted�and

    implemented�firmly.

    Indian EconomyPage 3 of 16

    Analyst: Asmita Deshmukh©�2008�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.

    “Our financial system andeconomic fundamentals arestrong. RBI has endorsed theassessment. India is not the causeof the global financial crisis butsurely wants to be a part of thesolution.” P. Chidambaram, Finance Minister of India.(Source: Economic Times, October 24, 2008)

  • • Unipres Corporation to build an auto component plant in IndiaUnipres�Corp.,�a�Japan-based�auto�component�manufacturer�plans�to�enter�the

    Indian�market�with�a�new�plant�in�Chennai.�The�new�plant�is�to�be�built�with�a

    JV�between�Japan’s�Marubeni�Corporation�and�Italy's�Magnetto�Automotive

    SpA.�The�total�investment�is�expected�to�be�USD�28�mn�of�which�55�percent�is

    to�be�contributed�by�Unipres�and�20�and�25�percent�by�Marubeni�and�Magnetto

    respectively.�The�plant�is�expected�to�produce�structural�components�for�car

    frames�and�is�projected�to�be�operational�by�2010.

    • Suzuki Motorcycle to ramp up the productionSuzuki�Motorcycle�India�Pvt.�Ltd.�a�subsidiary�of�Suzuki�Motor,�Japan�is

    expected�to�invest�USD�30�mn�in�its�India�business�adding�to�its�previous

    investment�of�USD�80�mn.�The�funds�are�expected�to�assist�the�capacity

    expansion�plans�of�the�company�and�new�product�launches.�The�company�plans

    to�ramp�up�its�production�capacity�from�1.75�lakh�units�to�2.5�lakh�units,�at�the

    same�time�the�company�also�plans�to�launch�2�new�bikes�in�the�next�year.

    • Tata Motors acquires over 50 percent stake in a NorwegiancompanyTata�Motors�through�its�UK-based�subsidiary�Tata�Motors�European�Technical

    Centre�plc�has�acquired�a�50.3�percent�stake�in�Miljo�Grenlandnnovasjon,�a

    Norwegian�company.�The�reported�cost�of�acquisition�is�USD�1.9�mn.�The

    acquired�company�specializes�in�the�development�of�innovative�solutions�for

    electric�vehicles�and�is�to�provide�strategic�assistance�in�Tata’s�aim�of

    developing�convenient,�affordable�and�sustainable�mobility�solutions�through

    electric�and�hybrid�vehicles.

    • Ashok Piramal Group acquires a Czech auto component companyPMP�Components,�an�auto�component�company�of�the�Ashok�Piramal�Group

    has�acquired�PAL�International�of�Czech�Republic.�The�cost�of�acquisition�has

    currently�not�been�revealed.�PAL�International,�is�the�third�largest�wiping

    systems�manufacturing�company�in�Europe�with�an�annual�turnover�of�USD�25

    mn.�It’s�clientele�includes�Volkswagen,�Skoda,�Fiat,�Peugeot-Citroen�and�Volvo

    among�others.�The�acquisition�is�expected�to�give�PMP�a�7�percent�share�in�the

    European�market.

    • Michelin plans to open a factory in IndiaMichelin,�a�well�known�French�tyre�manufacturer�is�planning�to�open�a�unit�in

    India.�The�company�on�its�cost�cutting�spree�is�also�expected�to�expand

    capacity�in�the�low�cost�nations�like�its�unit�in�Brazil�which�currently�produces

    5,000�units�a�day.�Michelin�plans�to�control�its�spending�by�USD�2.4�bn�by

    2010.

    Page 4 of 16

    Auto and Auto Components

    Analyst: Rajiv Somani©�2008�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.

    "The Indian market is still largelya motorcycle market and in futurewe will do everything to be asignificant player in the segment".Atul Gupta, Vice-President Marketing and Sales, SuzukiMotorcycle India.(Source: The Press Trust of India Limited, October 23,2008.)

  • • Religare-Aegon acquires Lotus Mutual FundReligare�Enterprises,�a�leading�financial�services�provider,�has�agreed�to�acquireLotus�India�Asset�Management�Company�(AMC)�for�an�undisclosed�amount.Religare�has�acquired�Lotus�India�from�its�majority�shareholders,�Sabre�Capitaland�Fullerton�Fund.�The�company�plans�to�strengthen�Lotus�India’s�position�byinfusing�new�capital�into�its�schemes.�Religare�has�a�presence�in�the�AMCbusiness�through�its�joint�venture�with�Dutch�financial�group�Aegon.�Theaverage�assets�under�management�of�Lotus�India�at�the�end�of�October�2008were�nearly�USD�1�billion.�

    • Investment House acquires stake in MAPE AdvisoryKuwait-based�Global�Investment�House�has�acquired�an�11.11�percent�equitystake�in�MAPE�Advisory�Group�Limited,�one�of�India's�leading�boutiqueinvestment�banks,�for�about�USD�10�million.�MAPE�plans�to�utilize�the�funds�toexpand�its�institutional�broking�business.�MAPE�provides�services�related�toM&As,�private�equity,�fund�raising,�debt�syndication,�cross�border�advisoryservices�and�institutional�broking.�

    • Reliance Money buys stake in Hong Kong commodity exchangeReliance�Money,�a�unit�of�Reliance�Capital,�has�acquired�15�percent�stake�inHong�Kong�Mercantile�Exchange�(HKMEx).�Hong�Mercantile�Exchange�plans�tocommence�trading�operations�through�offering�dollar-denominated�oil�contractsin�the�first�quarter�of�2009.�This�deal�is�expected�to�enable�Reliance�Money�tobecome�the�second-largest�shareholder�in�the�HKMEx�and�also�secure�a�boardseat�in�HKMEx.�Earlier�this�month,�Reliance�Money�received�approval�foracquiring�a�10�percent�stake�in�the�National�Multi-Commodity�Exchange�ofIndia.�The�company�plans�to�build�synergies�between�both�the�exchangesthereby�leveraging�on�the�growth�potential�of�commodity�trading�in�Asia.

    • RBI cuts CRR, Repo rate and SLRThe�Reserve�Bank�of�India�(RBI)�has�announced�another�100�basis�points�cut�inCash�Reserve�Ratio�(CRR)�to�5.5�percent�and�a�0.5�percent�reduction�in�reporate�to�7.5�percent,�with�a�view�to�infuse�additional�liquidity�into�the�bankingsystem.�The�CRR�cut�is�to�be�in�two�tranches�and�the�first�one�of�0.5�percent�isexpected�to�be�effective�retrospectively�from�25�October�2008�and�the�secondfrom�8�November,�2008,�while�the�cut�repo�rate�is�to�be�effective�from�3November,�2008.�The�cut�in�CRR�is�estimated�to�infuse�approximately�USD�8billion�in�to�the�banking�system.

    RBI�has�also�reduced�the�Statutory�Liquidity�Ratio�(SLR),�the�amount�whichbanks�are�mandated�to�park�in�government�securities,�by�100�basis�points�to�24percent.�Earlier�in�October�2008,�RBI�had�already�cut�CRR�by�2.5�percent�to�6.5percent.

    • ICICI Securities opens Oman branchICICI�Securities,�a�group�company�of�ICICI�Bank�and�one�of�India’s�leadingfinancial�services�firms,�launched�its�Oman�operations�by�opening�its�branch�inMuscat.�ICICI�Securities�plans�to�provide�its�online�trading�services�through�itsplatform�ICICIdirect.com,�to�the�large�NRI�population�based�in�Oman.��Also,�thebranch�is�to�provide�other�investment�and�financial�products�like�mutual�funds,hedge�funds,�private�equity�funds,�structured�products�and�alternateinvestments.�

    Page 5 of 16

    Banking and Insurance

    Analyst: Kunal Jain©�2008�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.

    Company AcquirerOwnership

    (%)Amount

    (USD Mn)

    StandardChartered

    IDFC 100 205

    RelianceMutual Fund

    Eton�Park 5 127

    JM FinancialMutual Fund

    ValiantCapitalPartners,Blue�RidgeCapital�andEton�Park

    12 26.5

    Bank ofBaroda AMC

    PioneerInvestments 51 NA

    CanbankInvestmentManagement

    RobecoGroup�NV 49 NA

    SBI MutualFund

    SocieteGenerale 37 37

    Source:�VC�Circle

    Recent Mutual Fund Deals in India

  • • DLF partners with Italian firm LuxotticaItalian�group�Luxottica�has�entered�into�a�partnership�with�Indian�real�estatemajor�DLF�to�retail�its�premium�and�luxury�eyewear�brands�which�includeOakley,�Ray-Ban,�Chanel,�Dolce�&�Gabbana,�Donna�Karan,�Prada,�Versace�andPolo�Ralph�Lauren.�Luxottica�plans�to�open�over�100�stores�of�its�retail�brand,Sunglass�Hut,�in�the�realty�firm's�upcoming�shopping�malls.�Luxottica�currentlyoperates�over�2,000�Sunglass�Hut�retail�stores�across�the�globe.�In�all,�thecompany�has�over�6,000�optical�and�sun�retail�stores�across�Asia,�China,�SouthAfrica,�Europe�and�America.�

    • Esprit plans a JV with Madhura The�USD�5�billion�group,�Esprit�Holdings�plans�to�form�a�51:49�percent�jointventure�with�Madhura�Garments,�an�AV�Birla�Group�company,�which�managesEsprit’s�retail�stores�in�India.�Esprit�entered�into�a�licensing�agreement�withMadura�in�2005.�Esprit,�with�over�40�stores,�has�significant�retail�spread�at�theluxury�end�of�the�Indian�apparel�market�and�has�plans�to�set�up�150�stores�inthe�country�by�2010.

    • Giorgio Armani makes its foray into India Fashion�luxury�brand�Giorgio�Armani�launched�its�flagship�stores�in�India.�The�2stores�launched�are�located�in�South�Delhi�and�are�spread�over�200�to�300square�metres.�The�outlets�are�managed�by�a�newly�formed�company,�GiorgioArmani�India�Pvt�Ltd,�which�is�a�joint-venture�between�the�Giorgio�ArmaniGroup�and�the�DLF�Retail�Brands�Private�Limited.�The�former,�with�a�51�percentstake�in�the�company,�is�to�design,�manufacture,�distribute�and�retail�fashionand�lifestyle�products�and�the�latter�is�to�have�exclusive�rights�to�developArmani�retail�stores�throughout�India.�

    • Wadhawan Retail to invest USD 313 million over the next 4 yearsIndia’s�food�and�grocery�retailer,�Wadhawan�Food�Retail�plans�to�invest�USD313�million�by�2013�to�set�up�1,300�stores�across�India.�The�company�is�lookingat�increasing�its�footfall�by�15�times�over�the�current�average�footfall�of�1�lakhacross�all�its�stores�once�the�expansion�is�completed.�The�funding�of�theinvestments�is�expected�to�be�through�debt�and�internal�accruals.�At�present,Wadhawan’s�retail�chain�has�200�neighbourhood�stores�which�are�run�underfour�branded�formats,�namely�Spinach,�Sabka�Bazaar,�The�Home�Store�andSmart�Retail.�The�retailer�also�runs�a�direct-to-home�delivery�business,�SangamDirect,�which�it�acquired�from�Unilever�India.�

    • Reliance Brands forms JV with DieselReliance�Brands�has�formed�a�49:51�percent�joint�venture�with�Italian�lifestylebrand�Diesel�to�launch�the�global�brand�in�the�country�in�2009.�The�DieselLifestyle�brand�is�to�offer�a�vast�selection�of�apparels,�shoes,�bags,�eye-wearand�fragrances,�targeting�the�high�end�consumer�segment.�Reliance�plans�tolaunch�Diesel�brands�in�Mumbai�and�Delhi�in�2009�and�may�also�look�at�the�fastupcoming�markets�like�Bangalore,�Hyderabad�and�Chandigarh.�The�high-endapparel�and�accessories�market�in�India�is�estimated�at�USD�834.7�million�andis�growing�at�the�rate�of�25�percent.�

    Page 6 of 16

    Consumer Markets and Retail

    Analyst: Sonia Topiwala ©�2008�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.

    "This is an especially importantdevelopment for our group and aturning point for our business inIndia. It allows us to become fromday one a key player in one of themost promising retail markets forpremium and luxury brandsworking side-by-side with theleading real estate company in themarket. "Andrea Guerra, chief executive officer, LuxotticaGroup.(Source: DLF Company Website, November 04, 2008

  • • Ginger Hotels on expansion spreeRoots�Corporation,�subsidiary�of�Indian�Hotels�Company,�plans�to�open�sevennew�hotels�under�its�brand�name�-�Ginger�hotels�over�the�next�one-and-a-halfyears.�These�hotels�are�to�be�opened�in�Ludhiana,�Ahmadabad,�Mangalore,Guwahati,�Jamshedpur,�Pune�and�Durgapur.�The�Ludhiana�and�Ahmadabadhotels�are�likely�to�be�opened�in�the�next�2�months�followed�by�Guwahati,Mangalore�and�Durgapur�by�March�2009.�The�hotels�at�Pune�and�Jamshedpurare�expected�to�open�by�early�2010.�Currently,�the�company�has�14�operationalhotels�across�the�country.�

    • Indian Hotels to unveil Gateway HotelsTaj�Hotels�Resorts�and�Palaces,�one�of�the�leading�hospitality�groups,�haslaunched�its�network�of�up-scale�hotels�under�the�brand�—�‘The�GatewayHotel’.�The�company�aspires�to�open�50�hotels�and�currently�has�26�Gatewayhotels�under�its�new�brand.�It�has�signed�10�new�hotels�and�migrated�16existing�hotels�to�this�brand.�The�hotels�that�are�to�be�re-flagged�as�Gatewayare�at�Agra,�Bangalore,�Calicut,�Chikmagalur,�Coonoor,�Jaipur,�Jaisalmer,Madurai,�Mangalore,�Nasik,�Sasan�Gir,�Surat,�Vadodara,�Varanasi,�Vijayawadaand�Vishakhapatnam.�

    • Choice Hotels to set up 25 more hotels in IndiaChoice�Hotels,�a�global�hospitality�chain,�plans�to�invest�INR�1,500�crore�to�setup�25�more�hotels�across�India�by�2010.�The�group�has�tied�up�with�real�estateplayers�like�Amrapali�Group,�Mittal�Group,�and�Asterix�Group�for�developingthese�hotels.�Out�of�the�25�planned�hotels,�4�are�reportedly�being�branded�asClarion�(entry�level�5-star),�one�is�to�be�branded�as�Sleep�In�(accommodationbased�3-star)�and�the�rest�are�to�be�divided�among�the�Comfort�(restaurant-cum-accommodation�3-star)�and�Quality�(full�service�4-star)�brands.�Currently,Choice�Hotels�has�25�hotels�in�India�under�these�brands.

    • Phoenix Group launches 5-star hotel in IndiaPhoenix�Group�Global,�a�promoter�of�luxury�resorts�launched�its�brand�of�luxuryhotels�under�the�‘Zuri�Hotels�&�Resorts’�label.�The�Company�plans�to�investaround�INR�200�crore�partially�funded�by�debt�and�equity�for�the�brand.�This162�room�property�is�expected�to�be�operational�by�2009�in�Bangalore�andhave�5�food�and�beverage�options.�Phoenix's�existing�projects�in�India�includethe�two�Radisson�hotels�in�Goa�(Radission�White�Sands)�and�Kumarakom(Radisson�Plaza�Resort�and�Spa),�which�it�operates�under�franchise�agreementswith�Carlson�Hospitality.�

    • Country Club plans to open 100 CK27 Country�Club,�a�leisure�and�infrastructure�company�plans�to�open�over�100miniature�versions�of�its�larger�clubs�across�the�country�in�the�next�2�years.�Thefirst�club�-�CK27�under�this�smaller�club�category�is�opened�in�Bangalore.�Clubsare�also�expected�to�be�opened�in�Mumbai,�Delhi,�Ahmedabad�and�othermetros.�These�15,000-20,000�sq�ft.�clubs�are�to�be�based�on�a�satelliteconcept,�and�are�to�have�a�gymnasium,�health�spa,�multi-cuisine�restaurant�andindoor�games�under�one�roof.

    Page 7 of 16

    Analyst: Pallavi Phatak

    Hospitality

    ©�2008�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.

    Source:�CRISIL,�Monthly�Report,�October�2008

    Performance of Premium Hotel Segment –Occupancy Rate

  • • TCS buys Citigroup Global Services India’s�leading�IT�services�player,�Tata�Consultancy�Services�(TCS)�has�acquiredCiti’s�stake�in�Citigroup�Global�Services�Limited�(CGSL),�its�India-based�captiveBusiness�Processing�Outsourcing�(BPO)�arm�for�USD�505�million�in�an�all�cashdeal.�Apart�from�the�sale,�the�companies�have�signed�an�agreement�for�USD2.5�billion�wherein�TCS�is�to�provide�process�outsourcing�services�to�Citi�over�aperiod�of�9.5�years.�CGSL�has�more�than�12,000�employees�in�India�and�isexpected�to�generate�revenues�of�around�USD�278�million�in�2008.

    • Wipro BPO plans Business Shared Services Center in Brazil forAmBevWipro�Technologies‘s�Business�Process�Outsourcing�(BPO)�arm,�Wipro�BPO�issetting�up�a�Shared�Services�center�for�Latin�America-based�brewery�companyAmBev.�The�Center�is�to�provide�services�to�AmBev�in�the�areas�of�Finance�andAccounting,�Order�Management,�Customer�Services�and�HR�Services.��AmBevexpects�the�partnership�to�provide�it�with�significant�financial�benefits�and�isplanning�to�enable�it�to�leverage�transformation�opportunities�across�itsoperations�in�Latin�America.�Wipro�plans�to�provide�these�services�from�itsfacility�at�Curitiba�in�Brazil.

    • Xchanging acquires India's Cambridge Solutions for USD 134millionUK-based�Xchanging�has�agreed�to�buy�75�percent�of�the�India-basedoutsourcing�and�IT�group�Cambridge�Solutions.�The�USD�134�million�dealcomprises�of�about�USD�74.5�million�in�cash�and�the�issue�of�15,249,998�newXchanging�shares.�By�this�acquisition,�Xchanging�expects�to�enhance�its�marketpresence�and�potential�for�further�growth�in�the�United�States�and�Australia,�aswell�as�increase�the�scale�of�its�Indian�offshore�operations.

    • US-based CIBER acquires IteamicCIBER,�a�US-based�systems�integrator�has�agreed�to�acquire�India-based�ITservices�provider�Iteamic,�for�an�undisclosed�sum.�With�this�acquisition,�CIBERexpects�to�expand�its�capabilities�to�handle�off-shored�projects�from�the�USand�Europe.�Iteamic�provides�integrated�business�and�technology�solutions�andconsulting�services�to�established�and�emerging�companies�globally.

    • Dubai’s Lootah group plans software center in IndiaDubai-based�S.S.�Lootah�Group�plans�to�open�a�software�development�centerin�the�Technopark�campus�in�Kerala,�India.�The�group�already�has�a�corporateoffice�in�Delhi�and�in�Kerala�and�is�entering�into�software�development.Established�in�1956,�the�S.S.�Lootah�Group�is�a�family-owned�diversifiedbusiness�house�with�projects�across�key�industries�from�construction,�realestate,�energy,�food�and�hospitality�to�financial�services,�applied�research,Information�and�Communication�Technologies�(ICT),�education�and�healthcare.

    Page 8 of 16

    Analyst: Parnika Patil

    IT / ITeS

    ©�2008�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.

    “This is a great transaction thatbenefits all parties – Citi, ourcustomers, our employees andTCS. Our customers requireaccess to increasingly complexprocessing solutions and thisrelationship will achieve a ‘best inclass’ technology model thatcapitalizes on both CGSL’sexpertise in financial services andTCS’ expertise in processoptimization”.Don Callahan, Chief Administrative Officer, Citi.(Source: TCS Press Release, October 08, 2008)

  • • Compact Disc to setup a studio in VietnamCompact�Disc�India�(CDI)�has�raised�USD�10�million�debt�from�Los�Angeles-based�iMedia�Ventures�to�set�up�an�animation�studio�in�Vietnam.�The�animationcompany�in�Vietnam�plans�to�make�an�international�movie�based�on�Chinesecharacters.�The�company�has�also�diluted�15�percent�stake�to�iMedia�Venturesthrough�a�preferential�allotment.�CDI�is�also�producing�two�animated�moviesfrom�its�studio�in�Kerala

    • Deccan Chargers look for acquirersDeccan�Chronicle�group,�which�holds�an�80�percent�stake�in�Deccan�Chargers,a�Hyderabad-based�Indian�Premier�League�Cricket�Team,�plans�to�sell�theirentire�stake�for�USD�175-200�million�at�65-85�percent�premium.�DeccanChargers,�the�third�most�expensive�team�after�Mumbai�and�Bangalore,�hadreceived�investment�from�Group�M�for�a�20�percent�stake.�

    • Cinepolis to invest USD 350 million in Indian multiplex marketCinepolis,�a�Mexico-based�multiplex�player�has�initiated�talks�with�real�estatedevelopers�in�India�to�setup�their�multiplex�operations.�Cinepolis�India,�awholly–owned�subsidy�of�Cinepolis�Mexico,�has�allocated�USD�350�million�forits�India�operations.�The�company�also�plans�to�have�stand-alone�propertiesapart�from�their�mall�presence.�In�the�next�5-7�years,�the�company�plans�tohave�presence�in�40�cities�and�have�500�screens�in�India.�The�company�islooking�at�cities�with�the�right�combination�of�affluence,�and�a�movie�watchingpopulation.�The�company�operates�2000�screens�globally�and�has�added�240new�screens�this�year.

    • Spize TV acquired European Direct–to–Home (DTH) operatorPyramid�Saimira�Group�owned�DTH�service�Spize�TV�has�acquired�World�TVEurope,�the�DTH�operations�of�France�Telecom.�The�company�has�not�given�outany�financial�details�and�plans�to�invest�USD�15�million�in�the�short�term�tointegrate�operations�of�Spice�TV�and�World�TV�Europe.�The�company�has�alsoallocated�USD�50�million�for�its�European�operations�in�the�next�2-3�years.Spice�TV,�launched�in�2007,�is�a�registered�company�in�Singapore.

    • Bharti Airtel launches DTH servicesTelecom�operator�Bharti�Airtel�made�its�debut�in�the�television�space�with�thelaunch�of�its�DTH�satellite�television�service.�The�service�is�to�be�made�availableto�customers�through�21,000�retail�points�including�Airtel�relationship�centersin�62�cities.�The�service,�which�comes�at�an�entry�cost�of�approximately�USD50�in�north�India,�offers�different�packages�for�a�total�of�175�channels.�Formarkets�in�south�India,�the�service�is�to�be�available�at�a�starting�price�of�USD40.��

    Page 9 of 16

    Media

    Analyst: Mehul Desai©�2008�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.

    "This is a right time for Airtel toenter the market. The launch ofAirtel digital TV is the culminationof our 'three screens' strategy,which is to be present acrossmobile phone, computer and TVscreens. We are very clear atAirtel and will take over as aleader of the sector as soon aspossible" Manoj Kohli, CEO and Jt. Managing Director, BhartiAirtel.(Source: Financial Express, Oct 08, 2008)

  • • USD 9.1 billion investment likely for gas pipeline in 5 yrsIndia�is�expected�to�witness�a�significant�expansion�in�its�gas-pipeline�network

    over�the�next�five�years.�As�per�a�study,�approximate�investments�worth�USD

    9.1�billion�are�likely�to�be�provided�to�promote�the�utilization�of�gas.�Further,�it�is

    expected�that�the�share�of�oil�and�gas�in�the�primary�commercial�energy�mix

    may�grow�from�the�existing�36�percent�to�41�percent,�over�a�10�year�period.�At

    present,�India’s�gas�pipeline�network�is�over�10,000�km�consisting�of�Gas

    Authority�of�India�Ltd.��which�holds�a�55�percent�share�and�the�remaining�is�in

    the�joint�sector,�including�private�players.

    • Essar to restart 70 percent of their fuel stations Indian�private�refiner�Essar�Oil�is�expected�to�start�70�percent�of�their�fuel

    stations�by�the�end�of�the�year.�The�step�has�been�taken�with�respect�to�the

    sharp�fall�in�crude�oil�prices.�This�makes�the�retail�sales�viable�for�the�company

    and�also�other�private�players.��

    The�company�had�closed�down�majority�of�their�retail�outlets�last�year�due�to

    heavy�losses�suffered�on�account�of�low�retail�prices�set�by�the�government�for

    state-run�refiners.

    • Colombia takes control over OVL’s oilfieldColombia�has�taken�control�over�Teca�oilfield�which�was�a�part�of�the�oil

    property�of�ONGC�Videsh�Ltd�(OVL)�and�Sinopec�of�China.�The�oil�field�was

    acquired�2�years�ago�in�September�2006�for�an�amount�of�USD�850�million.

    Ecopetrol,�Colombia’s�national�oil�company�deemed�that�the�license�for�Teca

    oilfield�has�expired�whereas�Mansarovar�Energy�Colombia�Ltd.�(a�50:50�joint

    venture�agreement�between�OVL�and�Sinopec)�feels�the�contract�is�valid�till

    2011.

    • OMEL plans refinery in NigeriaONGC-Mittal�Energy�Limited�(OMEL),�a�joint�venture�between�state-run�Oil�&

    Natural�Gas�Corporation�Limited�(ONGC)�and�L�N�Mittal�group�is�planning�to�set

    up�its�first�refinery�in�Nigeria.�The�investment�required�for�this�proposed�9-

    million-tonne�refinery�is�around�USD�4�billion.�OMEL�and�the�Nigerian

    government�had�signed�the�Memorandum�of�Understanding�(MoU)�in

    November�2005.�The�MoU�states�that�the�company�is�expected�to�make�some

    infrastructure�investments�in�the�country�in�lieu�of�exploration�blocks.

    .

    Page 10 of 16

    Oil and Gas

    Analyst: Rajiv Parekh©�2008�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.

    ‘‘Significant expansion of gas-pipeline network is expected overthe next few years as India gearsup to create the network forpromoting gas utilization.”Sajjan Jindal, President, Assocham, commenting oninvestments in gas-pipeline.(Source: Economic Times, October 21, 2008 )

  • • Ranbaxy achieves significant milestones in its R&D efforts Ranbaxy�Laboratories�Limited,�one�of�India’s�largest�pharmaceutical�companies,has�submitted�an�Investigational�New�Drug�(IND)�application�to�the�DrugController�General�of�India�seeking�approval�to�commence�Phase-I�humanclinical�trials�for�the�Respiratory�Inflammation�candidate.�This�candidate�is�beingdeveloped�under�the�collaborative�agreement�between�Ranbaxy�andGlaxoSmithKline.�Ranbaxy�also�has�plans�to�get�regulatory�approval�in�othercountries�to�commence�Phase�I�human�trials.�

    Ranbaxy�has�also�attained�the�approval�from�the�Drug�Controller�General�ofIndia�to�start�Phase�III�human�clinical�trials�in�India�for�its�Anti-Malariacombination�molecule,�RBx�11160,�which�are�expected�to�be�conducted�inIndia,�Africa�and�South�and�South-East�Asian�countries.

    • Jubilant and Eli Lilly form a joint venture for drug developmentJubilant�Organosys�has�entered�into�an�agreement�with�Eli�Lilly�and�Company�toset�up�a�50:50:�joint�venture�in�India�in�order�to�provide�drug�development�servicesexclusively�to�the�molecules�being�developed�from�the�partnership�between�thetwo�companies.�The�venture�is�expected�to�carry�out�research�from�the�preclinicalstage�through�Phase�II�of�clinical�testing,�after�which�the�molecules�are�to�bereturned�to�the�R&D�sponsors�for�further�development.�The�operations�is�to�bemanaged�by�an�independent�team�of�R&D�specialists.�This�joint�venture�isexpected�to�be�set�up�in�Bangalore.�

    Jubilant�Organosys�is�one�of�India’s�leading�Custom�Research�And�ManufacturingServices�(CRAMS)�and�drug�discovery�and�development�services�companies.

    • Bharat Biotech is setting up a Biotech-Pharma-IT Park in OrissaBharat�Biotech�International�Ltd,�an�Indian�manufacturer�of�biotherapeutics�andvaccines,�is�expected�to�be�developing�a�‘Biotech-Pharma-IT�Park’�under�thepublic-private-partnership�route�with�the�government�of�Orissa.�The�stategovernment�has�allocated�about�54.86�acres�of�land�to�Bharat�Biotech�fordevelopment�of�the�park.�Of�this,�about�10�acres�of�land�is�expected�to�house�abiotechnology�incubation�center,�where�the�equipment/instrumentation�is�to�befinanced�by�the�Department�of�Biotechnology.�

    The�expected�cost�of�the�investment�is�about�USD�20�million�and�is�likely�to�becompleted�over�a�period�of�8�years.

    • Wockhardt enters into in-licensing agreement with UK-basedSinclairWockhardt�Limited,�one�of�India’s�leading�pharmaceutical�and�biotechnologycompanies,�has�entered�into�an�in-licensing�agreement�valid�for�10�years,�withUK-based�Sinclair�Pharma�plc�to�market�the�latter’s�range�of�dermatology�anddental�products�in�India.�Wockhardt�is�expected�to�import�the�bulk�drugs�fromSinclair�Pharma�and�manufacture�the�formulations�in�its�Indian�manufacturingfacilities.�It�is�also�in�talks�with�Sinclair�to�contract�manufacture�the�signedproducts�for�the�European�markets.

    This�agreement�strengthens�Wockhardt’s�presence�in�the�dermatology�anddentistry�segments.��As�per�ORG�IMS�estimates,�India’s�dermatology�market�isvalued�at�USD�0.4�billion.�

    Page 11 of 16

    Pharma

    Analyst: Nandita Kudchadkar & Dhruti Parikh

    ©�2008�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.

    "This is a great addition to Lilly'squest to create a networked R&Dorganization that will bring to bearresources and capability fromaround the world to help addressimportant medical needs forpatients globally."Robert Armstrong, PhD, Vice President of globalexternal research and development, Eli Lilly Commenting on the Jubilant- Eli Lilly venture(Source: Company Press release, October 03, 2008)

  • • Solar energy gathers momentumSolar�energy�which�was�once�considered�as�least�attractive�renewable�energyoption�due�to�its�uneconomical�production�cost,�is�now�gathering�momentum.India�currently�has�an�installed�solar�photovoltaic�capacity�of�about�10�MW.�

    On�the�supply�side,�government�incentives�in�the�form�of�solar�incentivepackage�scheme�(SIPS)�have�so�far�attracted�14�players�with�an�investmentcommitment�of�USD�27�billion.�On�the�demand�side,�Ministry�of�New�andRenewable�Energy’s�(MNRE’s)�10�year�generation-based�incentive�(GBI)scheme�is�likely�to�ensure�a�steady�return�for�the�solar�technologies,�furtherexpanded�by�states�such�as�Rajasthan�and�Punjab.

    • ADB to provide support to Himachal PradeshThe�Asian�Development�Bank�(ADB)�plans�to�help�Himachal�Pradesh�becomecountry’s�first�‘hydropower�state’�through�USD�800�million�multi-tranchefinancing�facility.�The�loan�is�to�be�provided�for�a�period�of�8�years�to�financethe�construction�of�several�run-of-river�hydropower�generating�plants,�which�isexpected�to�generate�808�MW�of�power�from�the�state.�The�ADB�and�HimachalPradesh�government�have�identified�2�projects�ready�for�financing�through�thefirst�loan�tranche�of�USD�150�million�–�the�construction�of�the�111-MW�SawraKuddu�hydroelectric�project�on�the�Pabber�river�in�Shimla�district,�and�civilworks�for�the�65-MW�Kashang�I�hydroelectric�project�located�in�Kinnaur�district.

    • NTPC and NPCIL to jointly foray into nuclear power generationNational�Thermal�Power�Corporation�(NTPC)�and�Nuclear�Power�Corporation�ofIndia�(NPCIL)�have�proposed�to�form�a�joint�venture�company�to�set�up�nuclearpower�generation�facilities�in�the�country.�NPCIL�is�to�hold�51�percent�whileNTPC�is�to�own�49�percent.�The�joint�venture�initially�plans�to�set-up�a�2,000MW�nuclear�power�plant.�

    • Suzlon Green Power to develop renewable energy portfolioSuzlon�Green�Power�Ltd.�intends�to�invest�USD�5�billion�to�generate�3500�MWof�electricity�in�India�and�China.�Of�the�total�project�value�of�USD�5�billion,Suzlon�Green�Power�Ltd.�is�to�contribute�approximately�USD�1.5�billion�inequity.�Suzlon�Green�Power’s�business�model�plans�to�offer�an�asset-basedlong-term�annuity�thereby�mitigating�environmental�challenges.�The�companyintends�to�invest�resources�in�acquiring�and�developing�existing�green�powerassets�and�projects;�garnering�support�vendors,�network�partners�andinvestors;�and�partnering�with�local�NGOs�to�develop�neighborhood�powerassets.

    Page 12 of 16

    Power

    Analyst: Rajiv Parekh©�2008�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.

    Source:�Working�Group�Report�for�XIth�Plan,�CEA

  • • Ozone to invest USD 1 billion in BangaloreOzone�group,�a�Bangalore-based�property�developer,�is�investing�about�USD�1

    billion�to�develop�a�mixed�use�project�in�Bangalore.�The�project�is�to�come�up

    near�the�new�Bangalore�international�airport�and�is�expected�to�develop�20

    million�square�feet�of�residential�and�commercial�space�on�180�acres�of�land.

    The�master�plan�is�being�developed�by�two�architects�from�US�and�Singapore.

    The�construction�of�the�project�is�scheduled�to�begin�by�mid�2009�and�be

    completed�in�5�to�6�years.�Urban�Infrastructure�Opportunities�Fund�(UIOF)

    owns�a�stake�in�the�company�and�HDFC�Venture�Fund�has�invested�in�the

    company’s�special�purpose�vehicle�for�implementing�its�USD�333�million

    residential�project�in�Chennai.

    • Bellwether to raise Housing FundBellwether�Microfinance�Fund�(BMF),�a�micro-finance�venture�capital�fund,�has

    launched�a�USD�100�million�India�Financial�Inclusion�Fund�(IFIF)�to�invest�in

    affordable�housing�projects�by�making�loans�available�at�cheaper�rates�to�lower

    income�groups.�The�fund�has�raised�USD�30�million�from�CDC�Group,�a�UK-

    based�investor�and�Global�Microfinance�Equity�Fund,�a�US-based�fund,�and�the

    remaining�USD�70�million�to�be�raised�by�August�2009.�

    • TDI launches ‘build and earn’ schemeTDI�Infrastructure�Ltd�(TDIL),�a�real�estate�developer,�has�launched�a�‘build�and

    earn’�scheme�at�its�TDI�City�in�Kundli.�As�per�the�‘Gross�Adjustment�in�the

    construction�expense’�scheme�plot�owners�who�wish�to�build�their�houses�will

    be�able�to�avail�a�rebate�of�20-25�percent�on�the�construction�cost.�In�the

    second�scheme�called�‘Assured�rent�for�22�months�post�construction’�the

    customers�would�be�able�to�earn�an�assured�rent�for�22�months�post

    completion�of�construction�if�they�desire.�The�construction�is�expected�to�be

    completed�in�about�10-12�months�and�the�customer�would�have�to�make�the

    payments�in�4�installments.

    • IL&FS acquires 30 percent in JB Pharma SEZIL&FS�Realty�Fund,�managed�by�IL&FS,�has�acquired�a�30�percent�stake�in�JB

    Pharma�SEZ�for�a�consideration�of�USD�15�million.�The�SEZ�is�jointly�promoted

    by�the�real�estate�firm�HBS�Realtors�and�JB�Mody�family,�the�promoters�of�JB

    Chemicals�and�Pharmaceuticals.�The�project�cost�is�estimated�at�USD�36

    million�and�State�Bank�of�India�(SBI)�and�State�Bank�of�Mysore�have�financed

    about�USD�19�million�for�the�project.�Post�this�deal,�the�promoters’�are�to

    continue�holding�35�percent�stake�each.�

    Page 13 of 16

    Real Estate and SEZs

    Analyst: Nitin Dehadraya ©�2008�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.

    “We are likely to see increaseddistress sales. High growthmarkets or core markets perceivedas oversold may attract the mostattention from buyers. With highvelocity of price change comes asan opportunity for buyers. Therange of opportunity will increasefor those able to commit equity.”Anuj Puri, Chairman and Country HeadJones Lang LaSalle Meghraj, real estate advisoryfirm. (Source: Business Standard, October 15, 2008.)

  • • BPL Mobile to infuse USD 20 million for expansionBPL�Mobile,�which�has�its�sole�presence�in�the�Mumbai�circle,�is�planning�toinvest�USD�20�million.�The�proposed�investment�is�to�go�towards�increasing�thenumber�of�cell�sites.�The�company�currently�has�1300�cell�sites�and�plans�toincrease�it�to�1800.�In�the�next�2�years,�BPL�plans�to�increase�its�subscriberbase�to�2�million�from�the�current�1.67�million.

    • Unitech offloads significant telecom business stake to TelenorUnitech,�the�real�estate�major,�has�offloaded�60�percent�of�its�stake�in�thetelecom�business�to�Norwegian�telecom�company�Telenor�for�USD�1220million.�Unitech�had�earlier�in�this�year,�acquired�a�pan�–India�telecom�licensefor�USD�320�million�and�spectrum�in�13�circles.�The�proceeds�from�the�stakesale�is�to�be�completely�utilized�for�telecom�operations�and�the�company�islikely�to�launch�services�in�first-half�of�2009.

    • RCom earmarks USD 6 billion expansion Anil�Ambani�controlled�Reliance�Communications�(RCom)�has�set�aside�USD�6billion�for�capital�expansion�in�2008–09.�The�expansion�is�expected�to�helpcompany�to�take�its�subscription�to�100�million�by�2010�from�the�current�60million.�

    • Idea Cellular to invest USD 1.6 billion in 2008-09Idea�Cellular�plans�to�invest�USD�1.6�billion�for�2008-09.�The�proposedinvestment�plan�excludes�3G,�Indus�Towers�and�Punjab�and�Karnataka�circles.As�a�part�of�its�expansion�plans,�the�company�is�targeting�a�network�of�42,000towers�by�end�of�2008-09.

    • Future Group enters into JV with Axiom Telecom for Mobile RetailFuture�Group�has�joined�hands�with�Axiom�Telecom�to�form�a�50:50�JointVenture�(JV)�known�as�Future�Axiom�Telecom�Ltd.�The�JV�company�is�expectedto�operate�more�than�500�stores�and�touch�points�in�58�cities�under�the�brandname�of�Mobile�Bazaar�and�Mport.�The�initial�investment�for�the�venture�isestimated�to�be�USD�40�million.�Future�Axiom�intends�to�retail�mobile�handsetsand�accessories�and�set�up�service�centers�in�India.�

    Page 14 of 16

    Telecom

    Analyst: Mehul Desai©�2008�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.

    “India is one of the largest andfastest growing mobile markets inthe world. While the telecommarket here is crowded, we feelthat there is room for a newentrant”. Sigve Brekke, Executive Vice-President and Head,Telenor Asia.(Source: -The Hindu Business Line, October 30, 2008.)

  • • SCI to invest USD 20 bn in enhancing cargo businessThe�Shipping�Corporation�of�India�(SCI)�is�planning�to�double�its�fleet�size�fromthe�current�capacity�of�5�million�dwt�(dead�weight�tonnage).�The�corporationhas�estimated�a�capital�outlay�of�USD�20�billion�to�execute�these�plans.Keeping�in�mind�that�about�95�percent�by�volume�and�70�percent�by�value�ofthe�country’s�international�trade�is�carried�on�through�maritime�transport,�theIndian�Shipping�industry�is�in�dire�need�of�a�facilitator�taxation�regime�to�pushthe�growth�of�cargo�business.

    SCI’s�decision�has�been�made�with�an�aim�to�boost�the�growth�of�the�shippingindustry,�which�has�been�stagnant�for�many�years�due�to�lack�of�a�level�playingfield.�Other�countries�provide�facilitative�taxation�for�their�shipping�industry.�Theworld�over,�the�shipping�industry�generally�pays�tax�rates�from�0.5�percent�to�1percent,�but�in�India,�the�industry�tax�rates�are�over�9�percent.�

    • Hamburg investor looks to set up India-focused shipping fundGerman�shipping�investment�firm�Konig�and�Cie�GmbH�and�Co.�KG�is�likely�toestablish�a�fund�focused�on�India,�where�shipping�lines�need�an�investment�ofaround�USD�20�billion�to�replace�old�vessels�and�acquire�new�tankers�in�linewith�changing�global�norms.�Under�the�International�Maritime�Organization(IMO)�norms,�all�liquid�carriers�have�to�be�double-hulled�by�2010�to�preventspillage�of�commodities�such�as�oil�in�case�of�accidents.�With�money�fromtraditional�sources�such�as�European�banks�hard�to�come�by�for�Indian�shippingfirms--�in�the�wake�of�the�global�financial�turmoil--�specialty�investmentcompanies�are�coming�up�with�focused�funds�to�capitalize�on�a�potentiallylucrative�opportunity.�Konig�and�Cie�plan�to�focus�mainly�on�ships�and�invest�inassets�such�as�dry�bulk�carriers,�oil�tankers�and�even�dredgers.�The�firm�is�yetto�decide�whether�to�locate�the�India-focused�fund�within�the�country�oroffshore.�Setting�up�local�shipping�funds�might�also�encourage�use�of�the�rupeefor�shipbuilding,�a�space�where�Indian�yards�are�just�beginning�to�make�a�mark.�

    • Eredene plans second logistics infrastructure fund in IndiaUK-based�investment�company�Eredene�Capital�has�lined�up�its�second�fund�ofUSD�300-400�million�to�invest�in�infrastructure�projects�in�India.�The�fund�is�tobe�raised�early�next�year�and�is�likely�to�focus�on�logistics�infrastructure�atports,�warehouses,�container�freight�stations,�distribution,�real�estate�andrelated�services.�The�company�has�a�pipeline�of�close�to�12�projects�for�thesecond�fund�to�invest�in.�This�is�expected�to�add�to�Eredene’s�first�investmentpipeline,�through�which�it�has�already�committed�USD�76�million�in�8�projects�inthe�country.�

    • Aerospace SEZ to come up in Andhra PradeshIndia’s�first-ever�exclusive�aerospace�Special�Economic�Zone�(SEZ),�AerospacePark,�is�to�come�up�in�Andhra�Pradesh.�Dr.�Kota�Harinarayana,�an�eminentaerospace�scientist,�is�to�head�the�Advisory�Group�for�implementation�of�theSEZ,�which�is�to�focus�on�manufacturing�of�defence,�aerospace�andcommercial�aircraft�components.�The�SEZ�is�to�be�developed�by�SamuhaGroup,�an�association�of�about�30�companies�in�Andhra�Pradesh�that�supplyvarious�components�to�the�aerospace�industry.�It�is�also�expected�to�housetesting�and�calibration�laboratories.�Samuha�is�a�co-developer�for�the�projectwith�AP�Industrial�and�Infrastructure�Corporation�for�the�establishment�of�the250-acre�SEZ.�

    Page 15 of 16

    Transport and Logistics

    Analyst: Preeti Sitaram©�2008�KPMG,�an�Indian�partnership�and�a�member�firm�of�the�KPMG�network�of�independent�member�firmsaffiliated�with�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.

    "We are confident of growth inlogistics and ports in spite ofconcerns of an economicslowdown. Even if there is aslowdown, the projected growthfor the ports and warehousingindustry is so large that growthwill not be impacted." Nikhil Naik, Chairman, Eredene Infrastructure.(Source: DNA India, October 18, 2008)

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    Press Trust of India

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