Reliance Petroleum commissions `only-for-export' refinery at Jamnagar

Reliance Petroleum Ltd, a subsidiary of Mukesh Ambani's Reliance Industries Ltd, on Thursday brought on stream the world's largest single-location refinery complex by cranking up a new exports-only refinery next to its existing unit at Jamnagar in Gujarat. Together, the two units will have a combined capacity to process 62 million tonne of crude a year, or 1.24 million barrels a day.

The new refinery, completed in a record 36 months at an investment of $6 billion, has been switched on at a time when demand for petroproducts is down in major global markets such as the US, Europe and Africa it wants to feed. It will be some time -- which could stretch upto 3-4 months -- before the unit starts running at full capacity. US major Chevron has a 5% stake in the refinery which deploys state-of-the-art technology capable of producing Euro-IV and Euro-V grade fuels even from the poorest quality crude.

Ability to process poorer quality crudes, called heavy or sour in industry parlance, helps refineries earn more from refining as such crudes are cheaper than sweeter or lighter grades. Though the existing unit mostly processes heavy crudes, the new refinery may initially use lighter sweet crude (low sulphur) for up to two months before using higher-sulphur crude when it becomes fully operational.

In the first phase, it would produce diesel, naphtha and jet kerosene. Petrol production may start by February or the beginning of March.

The crude distillation unit (CDU), the front end of a refinery which extracts various products like naphtha, kerosene, diesel and petrol, was started on Thursday and it normally takes 8-10 days for the first product to be ready for delivery, sources said, adding that it (the first product) would be in the market by early January.

Initially, the refinery will produce Euro-IV grade petrol and diesel and will upgrade to Euro-V once more complicated units like the desulfurisation unit are fully operational. The company is likely to produce 31,000 tonnes of diesel per day, and 25,000 tonnes of petrol, sulphur, pet coke and naphtha per day. It will, however, put off producing fuel oil and polypropylene till February-end.

"This refinery has been built with a significant capital cost competitive advantage," the statement said, adding: "This record has been achieved in spite of the significant shortfall in engineering and construction resources that has impacted most other refinery projects globally."

VAT war may cost liquor lovers dear

The proposal to hike value-added tax (VAT) on liquor in the UT might have been shot down once but with Himachal Pradesh (HP) endorsing what the Punjab Liquor Lobby has been saying for long, the next excise policy - to be drafted in January - may make liquor in Chandigarh somewhat costlier.

It would anyway not be an easy task as despite the excise and taxation departments of HP and Punjab recently writing to UT to rationalize its excise policy - by hiking VAT from 4 to 12.5% to stop inter-state smuggling - a section of the UT top brass still believes that it is not for Chandigarh to find solutions to the problem of illegal liquor sale in other states.

''The excise policy depends on a host of factors and the percentage of tax is only one of these. UT has to look at the broader picture before taking any decision. It remains to be seen if the excise and taxation department puts up a proposal in this regard,'' said a senior UT official.

A futile attempt to increase VAT on liquor from 4 to 12.5% was made earlier this year but it sparked off a controversy as the then excise and taxation commissioner Roshan Sunkaria put up the proposal straight to the UT administration without referring it to finance secretary Sanjay Kumar.

Later, when the finance department was asked to furnish a report on the issue, it ruled out any increase in VAT on the ground that the excise policy had already been notified for the year and this would amount to breach of contract. The report added that though UT can do so in extraordinary circumstances, there was no such pressing need.

The document presented by the excise departments of neighbouring states point out that in 2007-08 Chandigarh sold a quota of about 85 lakh proof litres (PL) of Indian Made Foreign Liquor (IMFL). Chandigarh has a population of 4 lakh and per person consumption per annum of IMFL is 21.31 PL, whereas Himachal, with a population of 60 lakh, has an annual per person consumption of 1.08 PL. For Punjab and Haryana, it is 1.17 PL and 1.06 PL, respectively.

A senior UT official, however, questioned the pressure on UT to change its policy when Haryana charges no VAT on liquor. An official said no decision had been taken on the issue as yet but a change in percentage of VAT would definitely be examined.Punjab 'liquor lobby' has been saying for long, the next excise policy - to be drafted in January - may make liquor in Chandigarh somewhat costlier.

It would anyway not be an easy task as despite the excise and taxation departments of HP and Punjab recently writing to UT to rationalize its excise policy - by hiking VAT from 4 to 12.5% to stop inter-state smuggling - a section of the UT top brass still believes that it is not for Chandigarh to find solutions to the problem of illegal liquor sale in other states.

sensex choppy, Tata Motors,DLF gains

Equities were choppy on Monday with positive bias due to lack of positive global cues and ahead of F&O settlement later this week. Secondline stocks continued to outperform benchmarks while realty and metals provided support for benchmarks. “After registering marginal gains on Friday, market is expected to remain subdued following the mixed global cues. The market may witness sideways movement during intra-day trades. However, the current net inflows from FIIs may help the sentiment to turn positive. The Nifty could test 3,000 on the downside and may test higher levels at 3,130 and on breaching this level may test the short-term target of 3,180, while the Sensex has a likely support at 9,950 and may face resistance at 10,200,” said Sharekhan market report. At 10:20 am, Bombay Stock Exchange’s Sensex was at 10136.51, up 36.60 points or 0.36 per cent. The index touched a high of 10148.74 and a low of 10070.56. National Stock Exchange’s Nifty was at 3076.65, down 0.03 per cent or 0.85 points. The broader index touched a high of 3101.90 and a low of 3058.20. “Trend deciding level for the day is 10,092 / 3,074 (Sensex/Nifty). If the market trades above these levels during the first half-an-hour of trade then we may witness a further rally upto 10,196 / 3,111. However, if it trades below 10,092 / 3,074 for the first half-an-hour of trade then it may correct up to 9,995 / 3,040,” said Angel Broking report. Second rung stocks were in demand. BSE Midcap Index was up 1.96 per cent and BSE Smallcap Index was 1.37 per cent higher. Tata Motors (4.85%), DLF (4.49%), Jaiprakash Associates (2.63%), Reliance Communications (2.11%) and Tata Steel (2.10%) were the top Sensex gainers. ICICI Bank (-2.32%), Wipro (-2.13%), HDFC (-1.51%), Infosys Technologies (-1.47%) and Sterlite Industries (-1.14%) were amongst the major Sensex losers. Market breadth was negative on the BSE with 1197 declines and 525 advances.

Chidambaram’s farewell gift to Indian carriers!

Before leaving office, former finance minister (now the home minister) P. Chidambaram had announced that North Block was willing to introduce a bill in Parliament to make jet fuel a declared good, if the government could muster enough political support to see it through the legislature. On becoming a declared good, aviation turbine fuel (ATF) would attract a uniform sales tax capped at the rate of 4 per cent across all states.

Domestic carriers are reeling under losses from high fuel costs even though global crude has reversed its steep rise quite dramatically. Indian airlines, by and large, are more vulnerable to oil shocks as Indian states milk ATF, levying sale tax at rates of up to 40 per cent on domestic airline companies. The rates of the tax are ad valorem, meaning they rise progressively as the cost rises. Delhi, for instance, collected about Rs 3,300 crore in sales tax on jet fuel last in 2007-08. ATF in Delhi is 72 per cent more expensive than comparable hubs in Singapore and Dubai mainly catering to Indian passengers.

International airlines pay the tax at 4 per cent. Hard-to-trim fuel costs thus make up more than half of the cost of operations for Indian carriers, making it tough for them to cut fares, attract more fliers and hope to fly out of near-bankruptcy.

Indian airlines, including Jet Airways, are expected to end this year with combined losses of around $2 billion, almost twice as much as they lost last year. ATF in Delhi is 72 per cent more expensive than comparable hubs in Singapore and Dubai mainly catering to Indian passengers.

International airlines pay the tax at 4 per cent. Hard-to-trim fuel costs thus make up more than half of the cost of operations for Indian carriers, making it tough for them to cut fares, attract more fliers and hope to fly out of near-bankruptcy. Indian airlines, including Jet Airways, are expected to end this year with combined losses of around $2 billion, almost twice as much as they lost last year.

What are declared goods?

Decades ago, the Parliament had prepared a list of declared goods to deal with just such a problem. The list includes among other items, rice, cotton, iron, steel, LPG, oil seeds and jute. It prevents states from heavily taxing these critical raw materials for revenues. The goods in the list attract a uniform value-added tax capped at 4 per cent. Parliament had legislated the list of declared goods to prevent states from exporting taxes to other states, says Satya Poddar, Partner (Global Tax Advisory Services), E & amp;Y, India. He doesn't recall additions to the list in the last two decades.

What will making ATF a declared good do?

ATF is mostly bought and sold at airports in the metros, where states make a killing on the taxes. Last fiscal, Maharashtra, for instance, mopped up Rs 30,000 crore in total taxes. If ATF is enlisted as a declared good, the state will lose nearly Rs 900 crore, which airlines will save. Private airlines such as Liquor baron Vijay Mallya's Kingfisher and India's largest private carrier Jet Airways, have been lobbying hard with the government for a fair tax regime for ATF, which was traditionally a high-tax item owing to the categorisation of aviation as a highend service. The low-cost carrier model changed this notion forcing the Centre to rationalise taxes on the fuel earlier this year. Airlines have welcomed Chidambaram's announcement.

Nifty ends below 3K; RIL, Satyam, R-Com, Bharti, L&T drag

Sell-off in metal, telecom, power, capital goods stocks as well as in Reliance Industries and sharp cut in Satyam Computer has pushed the benchmark indices sharply lower. Downtrend in European markets and US futures also added some fuel to the negative sentiment.

The markets had started the day with gap up but immediately indices turned extermely volatile. In the second half of session, both the benchmark indices slipped into red following weak European markets and US futures. The Nifty went below 2950 in late trade.

The Sensex has touched an intraday low of 9,682.91, before closing the day at 9,715.29, down 261.69 points or 2.62% from previous close. In the beginning, it tested 10,000 mark.

The 50-share Nifty slipped 2.87% or 87.40 points, to settle at 2954.35, after touching an intraday low of 2943.50. It was hovering around 3000 mark for major part of the day, but profit booking pushed below the same level.

Midcap and small cap indices broke five days winning streak and closed weak. BSE Midcap Index slipped 108.04 points or 3.33% at 3,136.17 and Small Cap Index was down 98.09 points or 2.6% at 3,678.56.

Draggers in today's trade were Reliance Industries, Bharti Airtel, Reliance Communication, Satyam, BHEL, SBI, L&T and Reliance Infrastructure. However, ICICI Bank, Infosys, ONGC, HUL, HDFC Bank, Grasim and Wipro were on buyers' radar throughout the session.

Satyam Computer was the biggest loser, went down 30.22% or Rs 68.45 to close at Rs 158.05 on the BSE. The company had announced a deal to buy 100% stake in Maytas Properties and 51% stake in Maytas Infra for USD 1.6 billion from its internal accruals, but the deal had raised serious questions of corporate governance. Big foreign financial firms downgraded the stock and asked to switch from the stock to big IT players. Satyam's ADRs fell 55% on Tuesday but managed to recover half of the loss. Finally, the company took decision to call off the deal after all this fiasco.

Satyam Computer has touched a new 52-week low of Rs 153.80 and traded with huge volumes of 33,368,270 shares, a jump of 4,141.36% compared to its 5-day average of 786,736 shares.

Maytas Infra locked at 20% lower circuit at 388.25. There were pending sell orders of 7,151 shares, with no buyers available. It traded with volumes of 247,957 shares, a jump of 16,349.32% compared to its 5-day average of 1,507 shares.

ADAG stocks took huge beating on the bourses today. Reliance Communication, Reliance Infrastructure, Reliance Capital and Reliance Natural Resources tumbled 11.5-16%. Adlabs Films fell 9.25%.

BSE Realty Index underperformed other indices; fell 169.18 points or 7.36% to 2,129.21. Unitech and DLF lost 8.6-9.1%.

Huge selling was seen in telecom stocks as well. Reliance Communication plunged 13.36%, Idea Cellular and Bharti Airtel lost 4.7-7.6%.

Power stocks like Reliance Infrastructure slipped 13.63%. Suzlon Energy, Reliance Power, Tata Power and GMR Infra fell 3.7-9.4%. Power Index was down 81.07 points or 4.44% at 1,743.64.

Metal Index plunged 4.36% or 242.63 points, to settle at 5,323.44. SAIL, Jindal Saw, JSW Steel, Sterlite Inds, NALCO, Hindalco and Tata Steel fell 2.6-8.7%.

IT Index lost 94.65 points or 4.04% to 2,245.93, due to big fall in Satyam. TCS was down 0.76%. However, Infosys and Wipro gained 1.5%.

Capital Goods stocks like BHEL and L&T tumbled 3.3-4.37%. BSE Capital Goods Index tumbled 274.46 points or 3.86% to 6,835.42.

Profit booking was also seen in oil stocks like Reliance Industries plunged 2.64% and Reliance Petroleum fell 8.35%. Oil & Gas Index slumped 189.85 points or 2.9% at 6,364.34. However, ONGC gained 0.39%.

Healthcare Index lost 48.23 points or 1.64% at 2,891.22. Biocon, Sun Pharma, Wockhardt, Dr Reddys Labs and Ranbaxy Labs lost 2-7.5%.

FMCG Index closed with a loss of 16.59 points or 0.83% at 1,973.20. Tata Tea, ITC, United Spirits, Marico and GlaxoSmith Consumer tumbled 1.15-2.4%.

Auto stocks like Tata Motors and Hero Honda were losers. Index was down 19.92 points or 0.81% at 2,441.77. However, M&M, Bharat Forge and Maruti Suzuki were gainers.

Bankex fell marginally by 8 points to 5,249.38. SBI lost 2.98%. However, ICICI Bank and HDFC Bank rose 1.8-2.4%.

Among the midcap stocks, Maytas Infra, Thermax, Thomas Cook, Welspun Gujarat and Bombay Rayon slipped 13-20%.

In the small cap space, Prime Focus, Hind Dorr-Oliver, Deep Industries, ETC Networks and Astra Microwave plunged 11-19%.

Market breadth was weak due to negative broader indices; about 1074 shares advanced while 1681 shares declined. Nearly 445 shares remained unchanged.

Volumes were huge in today's trade; total traded turnover was at Rs 67,104.59 crore. This includes Rs 12,860.45 crore from NSE Cash segment, Rs 49,360.05 crore from NSE F&O and the balance Rs 4,884.09 crore from BSE cash segment.

On the global front, European markets were trading weak, fell around 1.5% each during the day. FTSE was down 8.19 points to 4,300. CAC lost 16 points to 3,235 and DAX down 26 points to 4,703, at 4:42 hours IST.

US futures were also trading lower. The Dow Jones Futures was down 146 points at 8,768 and Nasdaq Futures fell 16 points at 1,225.

However, Asian markets closed higher. Hang Seng surged 2.18% and Jakarta up 1.57%. Nikkei, Straits Times, Taiwan and Kospi gained 0.5-0.71%. Shanghai was up just 0.09%.

Nintendo breaks records with Wii sales in America

November sales of Wii, the games console produced by Nintendo, more than doubled in the United States from the same period last year to a record-breaking two million units.

The figure was a record for any console in any month excluding last December, and eclipsed rival machines, according to NDP Group, the market researcher. Microsoft sold 836,000 units of its Xbox 360, up 8.6per cent on November last year. Sony's PlayStation 3 sales totalled 378,000, down nearly a fifth. The figures will silence critics who dismissed the cheap and cheerful Wii, which costs much less than PlayStation 3, as a novelty with limited appeal.

Rather, the Wii's developers, who broke new ground by building “a video games console for people who don't like video games” — women and older audiences — appear to have hit on a hardy winning formula. The console's relatively low price, in particular, looks well suited to an economic downturn, analysts say.

The sales pitch of Nintendo, the Japanese video game company, now appears to be hitting a familiar note: the company is giving warning that it cannot guarantee adequate supplies of the Wii to meet demand, a message it also gave out last year.

Reggie Fils-Aime, the head of Nintendo's operations in America, said: “It's clear that the consumer demand is exceptionally strong. With all our activity and effort, we can't commit that the product will be available up until Christmas Day. We're in uncharted territories when it comes to demand.”

Other video games companies approach the key Christmas period in less festive moods. Electronic Arts, the largest games publisher, gave warning this week that it would miss earnings targets because of weak sales. THQ, the company behind the Wall-E games based on the animated Pixar character, said it would close five of its studios, eliminating 250 jobs.

Nintendo is also leading in sales of hand-held game players. Consumers bought 1.57 million DS machines, compared with 421,000 units of Sony's PSP, NPD said. The PSP sales are down 26 per cent from last year.

According to NPD, the video games industry in America achieved $2.9 billion in sales last month, up 10 per cent from a year earlier.

Final Chrome Version Boosts Speed, Compatibility

PC Magazine has performed follow-up tests of Google Chrome to see how much progress the browser has made since coming out of beta. The results show that its already fast JavaScript performance on the respected Sunspider benchmark has gotten even faster and compatibility with popular sites such as Facebook has improved.

The retest shows a 24 percent speed improvement, bringing this released browser to the same level of performance as Firefox's second beta 3.1 version. The new numbers far outstrip what Microsoft's Internet Explorer was capable of, by a factor of nearly 100, and even bested the released version of Firefox 3.0's results more than threefold.

However, there are still sites that kick back an "unsupported browser" message when a user attempts to view them using Chrome, such as Microsoft's Office Live site. Chrome has added a separate bookmarks window, though it still lacks many capabilities found in the competition, such as bookmarking multiple sites at once (also known as tabbed groups) and tagging.

In memory usage, Chrome still holds up the rear, using somewhat more RAM than Internet Explorer, and more than double what Firefox consumed in testing with the same set of ten content rich sites. In standards support, Opera is still the leader, garnering 85 out of 100 possible points on the Acid3 Browser Compatibility test from the Web Standards Project.