The highest borrowing costs among Asia’s biggest economies are forcing Indian filmmakers to shoot fewer movies or rely on tax breaks from the U.S. or Europe.
WHAT TO WATCH: * State-run IDBI Bank Ltd. lends at 16 percent to studios, compared with 13 percent for utilities, Executive Director R.K. Bansal said in an Oct. 17 interview. That’s three times more than six-year funding costs for Burbank, California-based Legendary Pictures Inc. in June. Bollywood can cut costs by 60 percent by tapping tax breaks or loans overseas, Shah Rukh Khan, the best-paid Hindi film actor, said on Oct. 14. Mumbai-based Eros International Media Ltd. shot its latest movie in Spain. * An Indian court on Oct. 22 charged former telecommunications minister Andimuthu Raja and two other officials with bribery, forgery and conspiring to cause financial loss to the government in a case related to sale of phone licenses in 2008, paving the way for their trial. Unitech Ltd. Managing Director Sanjay Chandra, DB Realty Ltd. Managing Director Vinod Goenka, Reliance ADA Group Managing Director Gautam Doshi and Senior Vice Presidents Hari Nair and Surendra Pipara were also charged. * Prime Minister Manmohan Singh said Oct. 22 that the economic slowdown in India should be seen as a short-term phenomenon caused by the turmoil in the global economy, and the nation’s long-term prospects are “very good.” * Nuziveedu Seeds Pvt. may raise about 8 billion rupees ($160 million) from an initial public offering, two people familiar with the process said, declining to be identified because the details aren’t public yet. * European leaders ruled out tapping the European Central Bank’s balance sheet to boost the region’s rescue fund and outlined plans to aid banks, inching toward a revamped strategy to contain the Greece-fueled debt crisis. * China must continue efforts to control food and housing prices to ease soaring inflation and maintain economic development and social stability, Premier Wen Jiabao said in a statement posted Oct. 22 on the central government’s website. EARNINGS: * ITC Ltd. Est. 14.7 billion rupees * Sterlite Industries (India) Est. 15.7 billion rupees * GAIL (India) Est. 10.4 billion rupees * Mahindra & Mahindra Financial Est. 1.41 billion rupees * Union Bank of India Est. 5.54 billion rupees * Titan Industries Est. 1.55 billion rupees * Pfizer India, Wyeth, EID Parry India, Strides Arcolab, Tata Coffee, Container Corp. of India, Delta Corp, State Bank of Mysore, VIP Industries, National Fertilizers, JM Financial, Sun Pharma Advanced Research Co., Ajanta Pharma. MARKETS: * The Dow Jones Industrial Average surged 2.3 percent. * The MSCI Asia Pacific Index advanced 1.8 percent. * The BSE India Sensitive Index fell 0.9 percent to 16,785.64. * SGX S&P CNX Nifty Index futures for October delivery climbed 1.1 percent to 5,122. EQUITY MOVERS: * Phone-license case: An Indian court charged Unitech Ltd. (UT IN) Managing Director Sanjay Chandra, DB Realty Ltd. (DBRL IN) Managing Director Vinod Goenka, Reliance ADA Group Managing Director Gautam Doshi and Senior Vice Presidents Hari Nair and Surendra Pipara and Reliance Telecom Ltd., a unit of billionaire Anil Ambani’s flagship-company Reliance Communications Ltd. (RCOM IN), Swan Telecom Pvt. and Unitech Wireless Ltd. in a case related to the 2008 sale of phone licenses. All have denied any wrongdoing. Reliance Communications fell 0.8 percent on Oct. 21 to 74.3 rupees, Unitech dropped 0.9 percent to 26.7 rupees and DB Realty declined 0.3 percent to 56.1 rupees. * Retailers: The government has dropped its plan to allow foreign direct investment in multibrand retailing, the Hindu Business Line reported Oct. 22, citing Thomas Varghese, chairman of the Confederation of Indian Industry’s committee on retail. Pantaloon Retail India Ltd. (PF IN) tumbled 3.5 percent to 182.45 rupees. Shoppers Stop Ltd. (SHOP IN) gained 0.6 percent to 355.95 rupees. Trent Ltd. (TRENT IN) fell 0.5 percent to 1,034.8 rupees. * Airlines: India’s industry ministry has recommended that foreign airlines be allowed to buy as much as 26 percent stake in the nation’s domestic carriers, the Press Trust of India reported, citing sources it didn’t identify. Jet Airways India Ltd. (JETIN IN) slid 2.5 percent to 232.5 rupees. Kingfisher Airlines Ltd. (KAIR IN) slid 2.4 percent to 22.6 rupees. SpiceJet Ltd. (SJET IN) retreated 2.9 percent to 21.9 rupees. * Axis Bank Ltd. (AXSB IN): The lender reported a net income of 9.2 billion rupees in the quarter ended Sept. 30, compared with 7.35 billion rupees a year earlier. The median estimate of 34 analysts surveyed by Bloomberg was 9.2 billion rupees. The shares dropped 0.3 percent to 1,127.7 rupees before the earnings were announced on Oct. 22. * Grasim Industries Ltd. (GRASIM IN): The cement and viscose staple fiber maker reported net income of 4.18 billion rupees in the quarter, compared with 3.23 billion rupees a year earlier. The median estimate of 11 analysts surveyed by Bloomberg News was 3.91 billion rupees. The shares retreated 1.3 percent to 2,289.55 rupees. * Godrej Properties Ltd. (GPL IN): The developer’s board has approved plan to raise 7.5 billion rupees. The company may raise funds selling new shares in public issue, rights offer, private placement or combination, it said in a filing to stock exchange. The shares added 1.2 percent to 668.6 rupees. * JSW Steel Ltd. (JSTL IN): India’s third-biggest producer is in talks with its customers to raise prices by 3 percent to 4 percent, the Business Standard reported citing Jayant Acharya, director (sales and marketing). The shares slid 0.4 percent to 580.45 rupees. * Maruti Suzuki India Ltd. (MSIL IN): The carmaker is scouting for land in Maharashtra state to set up a factory after workers’ strike at its Manesar plant near New Delhi disrupted production, the Hindu Business Line reported, citing a government official it didn’t identify. The stock climbed 1.6 percent to 1,094.55 rupees. * Polaris Software Lab Ltd. (POL IN): The banking software developer said profit in the quarter ended Sept. 30 rose 12 percent to 539.4 million rupees. The shares plunged 6.2 percent to 128.5 rupees. * Power Grid Corp. of India (PWGR IN): The nation’s biggest transmission company reported a net income of 7.09 billion rupees in the quarter to Sept. 30, compared with 6.51 billion rupees a year earlier. The median estimate of 14 analysts surveyed by Bloomberg was 7.19 billion rupees. The shares were unchanged at 99 rupees. * Rallis India Ltd. (RALI IN): The agrochemicals maker controlled by the Tata Group may buy the additional 5 percent to 7 percent in the Bangalore-based seeds company Metahelix Life Sciences in the year beginning April, Financial Chronicle reported, citing an official it doesn’t identify. The company plans to buy out Metahelix by gradually increasing its existing 72.98 percent stake within three to five years, the report said. The shares increased 0.9 percent to 163.55 rupees. * Suzlon Energy Ltd. (SUEL IN): Asia’s third-biggest maker of wind turbines, reported group net profit of 480 million rupees in the three months ended Sept. 30, compared with a 3.7 billion- rupee loss last year. The company said orders at its German unit Repower Systems SE are shielded from the European debt crisis. The shares declined 0.3 percent to 36.2 rupees. * Tata Motors Ltd. (TTMT IN): India’s biggest truckmaker and owner of Jaguar Land Rover has recalled about 18,000 of its luxury cars in the U.K. due to a potential cruise control problem, Sky News reported Oct. 21, citing a company official. The shares fell 2.7 percent to 178.15 rupees. * Unichem Laboratories Ltd. (UL IN): The maker of antibiotics and pain killers said profit for the second quarter ended Sept. 30 plunged 45 percent to 191.4 million rupees from a year earlier. The shares lost 2.1 percent to 134.1 rupees. BOARD MEETINGS: * Container Corp. of India * GAIL India * Sterlite Industries India * Union Bank of India ANALYST RATINGS: * Biocon Ltd. (BIOS IN) was downgraded to “neutral” from “buy” at Motilal Oswal Securities Ltd. by analyst Nimish Desai on Oct. 21, with a 12-month price target of 364 rupees per share. CONFERENCES/EVENTS: * 12:15 p.m. Mumbai. M.G Sanghvi, executive director, Bank of Maharashtra will discuss the bank’s quarterly results. Venue: M V M Banquets, Near Y B Chavan Centre, Gen. Jagannath Bhosale Marg. * 1 p.m. New Delhi. Samar Singh Sheikhawat, senior vice president, marketing, United Breweries will unveil commemorative Formula 1 beer cans. Venue: Q’BA, Connaught Place. * 6 p.m. Chennai. Commemorative oration on “Corporate Governance,” with special reference to banking industry. Speakers include M. Veerappa Moily, minister of corporate affairs, M Narendra, chairman, Indian Overseas Bank. Venue: Taj Coromandel, Chennai.