Virgin mobile, a UK based mobile company, made a franchise with Tata Mobile to launch a new mobile service in India. The major target group of this mobile service are young people between the ages of 14-25. Richard Branson, the founder of Virgin Mobile, said that the mobile service includes music, news on Indian movies, sports, stock market.
International Herald Tribune reports:
The British billionaire said his company would launch Virgin Mobile handset services through Tata Teleservices Ltd, a top Indian mobile operator, in 50 cities initially, expanding to more than 1,000 cities by December.
"India looks very, very promising. We need only a small percentage of the market to do well," Branson told reporters at a news conference.
Branson said the size of India's youth market was staggering.
"It's six times the size of the U.K.'s population and we are bound to have lots of fun here," he said.
According to Branson, initially his company is targeting 5 million base subscribers and be able to generate revenue within next three years. The company will offer mobile handsets ranging from US$50 to US$125.
Virgin Mobile, a part of Virgin Communications, is one of the first virtual mobile network operators in the world. Starting 1999, the company does not have its own networks but uses the existing mobile phone networks of various companies to offer its service. Currently, it is operating in United Kingdom, Australia, Canada, South Africa, the United States and France. In India, Virgin is the first mobile virtual network operator (MVNO).
Virgin Mobile India, the name of the franchise, initially will offer its services in 50 Indian cities from which it would expand to 1000 cities.
Tata Mobile is subsidiary of the famous Tata Group of companies. Currently, it is one of the largest mobile phone service providers in India having network in 5,000 Indian cities and towns. Ratan Tata, the chairman of the group is also very optimistic about the future of this franchise. He believes that it would bring freshness and innovation to the Indian mobile subscribers.
India is one of the fastest growing mobile markets in the world. Since July 2007, Indian mobile phone companies are getting around 8 million subscribers each month due to lower call rate and cheap handsets. Last month, Indian mobile phone companies added 8.77 million users which is even higher than China, another major mobile phone market. Still, only a quarter of the Indian population is enjoying the mobile phone service. Indian government is planning to increase the number of mobile phone subscribers up to 500 million by 2010.
Monday, March 03, 2008
ANALYSTS VIEW - India's 2008/09 budget
ABHEEK BARUA, CHIEF ECONOMIST, HDFC BANK, DELHI:
"It's focused on harnessing inflation -- acknowledges the possibility of lower growth, but does not take any explicit expansionary measures." In fact, reducing the fiscal deficit to a level below the FRBM target could be seen as a measure to try and reduce aggregate demand." And excise duty cuts are also, I think, geared to serve the same purpose of bringing in some relief on the price front.
SUDHIR KAPADIA, HEAD OF TAX, REGULATORY SERVICES KPMG, MUMBAI:
"Foreign institutional investors (FIIs) will face higher taxation because the short-term capital gains tax has been raised to 15 percent from 10 percent. In principle, it is laudatory but it increases the cost of doing business for FIIs."One disappointment in the tax proposals was that the surcharge on corporate tax, which was introduced as a temporary measure, has not been removed."
VIKAS KHEMANI, CO-HEAD INSTITUTIONAL EQUITIES, EDELWEISS SECURITIES, MUMBAI:
"The increase in short-term capital gains is a bit negative for the capital markets and it could have been avoided as the tax collection figures have been bouyant in the past few years from the markets."
"The securities transaction tax now seems to be a business expense instead of a credit expense and this will be a very big negative for the trading community."
INDRANIL PAN, CHIEF ECONOMIST, KOTAK MAHINDRA BANK, MUMBAI:
"From the bond market's perspective it is positive, as the fiscal deficit is lower than estimated and because the borrowing programme is a lot lower than expected. But we need to see the fine print on the tax and expenditure projections."
SAILESH JHA, SENIOR REGIONAL ECONOMIST, BARCLAYS BANK, SINGAPORE:
"The surprise number is the 2.5 percent fiscal deficit target for the 2008/09 year and that is very bond market positive. But it seems like they haven't taken the 6th pay commission recommendations into account while preparing the budget and that will be a number to watch out for in the coming months.
"But this means the market borrowing target for the first half of 2008/09 will be a small one. As for the tax cuts and the loan waivers, these are measures to woo the proletariat."
SHUBHADA RAO, CHIEF ECONOMIST, YES BANK, MUMBAI:
"It's in line with expectations. The budget has a large rural flavour. Some anti-inflationary measures in the form of excise cuts have been effected."Tax targets appear ambitious as indicated by a modest fiscal deficit. The emphasis on social sectors like health, education and the rural economy do suggest that the budget is leaning towards some populist measures.
"We await details of the funding of the farm loans waiver, which at this point appears a concern."
SHARMILA JOSHI, ASST VICE PRESIDENT, PRABHUDAS LILLADHER, MUMBAI:
"Overall, a positive budget. We expected it to be populist and it is on those lines. The duty cuts and rural segment focus show they are trying to filter down benefits to the lower end of society. Markets may have reacted negatively on the increase in short-term capital gains tax, but we think there will not be too much impact."
RUPA REGE NITSURE, CHIEF ECONOMIST, BANK OF BARODA, MUMBAI:
"The budget has effectively responded to the concerns voiced by the economic survey on Feb. 28. While the fiscal deficit target has been met because of buoyant tax revenues, technical and allocative efficiencies in expenses have not improved.
"Revenue deficit at 1.4 percent of GDP will act as a major hurdle in achieving fiscal consolidation. The budget has made a serious attempt to stimulate consumption demand by reducing indirect taxes on consumer durables like small cars, two- and three-wheelers etc., and by raising the personal income tax exemption limit.
"From the bank's perspective, the waiver of small farm loans in not a negative thing entirely as these were the most stubborn NPAs on banks' loan books. There is comfort that the government will partially bear the burden for banks."
SHUCHITA MEHTA, CHIEF INDIA ECONOMIST, STANDARD CHARTERED BANK, MUMBAI:
"The focus is on inflation, the social sector and consumer. However, capital spending is a little disappointing. The reduction of the fiscal deficit in '08/09 to 2.5 percent is positive, however it may not include the impact of the pay commission, so it could be higher than forecast. A lower than expected gross borrowing programme is positive from the market perspective."
HAN-SIA YEO, STRATEGIST AT BANK OF AMERICA, SINGAPORE:
"It is an election budget. The personal income tax changes are definitely welcomed. The smaller than expected borrowing requirement and budget deficit is a positive and the fiscal stimulus should offer some growth support."
A. PRASANNA, ECONOMIST AT ICICI SECURITIES, MUMBAI:
"It is a progressive, inclusive budget. Despite high provisions of social expenditure and the cost of the farm loan waiver, the finance minister has managed to better the budgeted fiscal deficit target which is a pleasant surprise and bond positive."
DEVESH KUMAR, MANAGING DIRECTOR, CENTRUM BROKING, MUMBAI:
"Most of the banks have written off their non-performing assets. So the write-off of the loans to farmers may not have much impact. If the government gives some support to the banks, then it will be positive."
-----
MARKET REACTION:
-- The stock market was down 2 percent after the government proposed to increase the short-term capital gains tax; shares in Indian vehicle makers rose due to budget proposals to cut excise duties on vehicles; bank shares fell due to a proposal to waive the debts of small farmers.
The yield on the 10-year federal bond was at 7.58 percent, down four basis points from before the budget speech and an intra-day high of 7.66 percent. It had ended at 7.60 percent on Thursday.
The partially convertible rupee was at 39.96/97 per dollar, weaker than 39.86/87 beforehand. It had ended at 39.87/88 on Thursday.
"It's focused on harnessing inflation -- acknowledges the possibility of lower growth, but does not take any explicit expansionary measures." In fact, reducing the fiscal deficit to a level below the FRBM target could be seen as a measure to try and reduce aggregate demand." And excise duty cuts are also, I think, geared to serve the same purpose of bringing in some relief on the price front.
SUDHIR KAPADIA, HEAD OF TAX, REGULATORY SERVICES KPMG, MUMBAI:
"Foreign institutional investors (FIIs) will face higher taxation because the short-term capital gains tax has been raised to 15 percent from 10 percent. In principle, it is laudatory but it increases the cost of doing business for FIIs."One disappointment in the tax proposals was that the surcharge on corporate tax, which was introduced as a temporary measure, has not been removed."
VIKAS KHEMANI, CO-HEAD INSTITUTIONAL EQUITIES, EDELWEISS SECURITIES, MUMBAI:
"The increase in short-term capital gains is a bit negative for the capital markets and it could have been avoided as the tax collection figures have been bouyant in the past few years from the markets."
"The securities transaction tax now seems to be a business expense instead of a credit expense and this will be a very big negative for the trading community."
INDRANIL PAN, CHIEF ECONOMIST, KOTAK MAHINDRA BANK, MUMBAI:
"From the bond market's perspective it is positive, as the fiscal deficit is lower than estimated and because the borrowing programme is a lot lower than expected. But we need to see the fine print on the tax and expenditure projections."
SAILESH JHA, SENIOR REGIONAL ECONOMIST, BARCLAYS BANK, SINGAPORE:
"The surprise number is the 2.5 percent fiscal deficit target for the 2008/09 year and that is very bond market positive. But it seems like they haven't taken the 6th pay commission recommendations into account while preparing the budget and that will be a number to watch out for in the coming months.
"But this means the market borrowing target for the first half of 2008/09 will be a small one. As for the tax cuts and the loan waivers, these are measures to woo the proletariat."
SHUBHADA RAO, CHIEF ECONOMIST, YES BANK, MUMBAI:
"It's in line with expectations. The budget has a large rural flavour. Some anti-inflationary measures in the form of excise cuts have been effected."Tax targets appear ambitious as indicated by a modest fiscal deficit. The emphasis on social sectors like health, education and the rural economy do suggest that the budget is leaning towards some populist measures.
"We await details of the funding of the farm loans waiver, which at this point appears a concern."
SHARMILA JOSHI, ASST VICE PRESIDENT, PRABHUDAS LILLADHER, MUMBAI:
"Overall, a positive budget. We expected it to be populist and it is on those lines. The duty cuts and rural segment focus show they are trying to filter down benefits to the lower end of society. Markets may have reacted negatively on the increase in short-term capital gains tax, but we think there will not be too much impact."
RUPA REGE NITSURE, CHIEF ECONOMIST, BANK OF BARODA, MUMBAI:
"The budget has effectively responded to the concerns voiced by the economic survey on Feb. 28. While the fiscal deficit target has been met because of buoyant tax revenues, technical and allocative efficiencies in expenses have not improved.
"Revenue deficit at 1.4 percent of GDP will act as a major hurdle in achieving fiscal consolidation. The budget has made a serious attempt to stimulate consumption demand by reducing indirect taxes on consumer durables like small cars, two- and three-wheelers etc., and by raising the personal income tax exemption limit.
"From the bank's perspective, the waiver of small farm loans in not a negative thing entirely as these were the most stubborn NPAs on banks' loan books. There is comfort that the government will partially bear the burden for banks."
SHUCHITA MEHTA, CHIEF INDIA ECONOMIST, STANDARD CHARTERED BANK, MUMBAI:
"The focus is on inflation, the social sector and consumer. However, capital spending is a little disappointing. The reduction of the fiscal deficit in '08/09 to 2.5 percent is positive, however it may not include the impact of the pay commission, so it could be higher than forecast. A lower than expected gross borrowing programme is positive from the market perspective."
HAN-SIA YEO, STRATEGIST AT BANK OF AMERICA, SINGAPORE:
"It is an election budget. The personal income tax changes are definitely welcomed. The smaller than expected borrowing requirement and budget deficit is a positive and the fiscal stimulus should offer some growth support."
A. PRASANNA, ECONOMIST AT ICICI SECURITIES, MUMBAI:
"It is a progressive, inclusive budget. Despite high provisions of social expenditure and the cost of the farm loan waiver, the finance minister has managed to better the budgeted fiscal deficit target which is a pleasant surprise and bond positive."
DEVESH KUMAR, MANAGING DIRECTOR, CENTRUM BROKING, MUMBAI:
"Most of the banks have written off their non-performing assets. So the write-off of the loans to farmers may not have much impact. If the government gives some support to the banks, then it will be positive."
-----
MARKET REACTION:
-- The stock market was down 2 percent after the government proposed to increase the short-term capital gains tax; shares in Indian vehicle makers rose due to budget proposals to cut excise duties on vehicles; bank shares fell due to a proposal to waive the debts of small farmers.
The yield on the 10-year federal bond was at 7.58 percent, down four basis points from before the budget speech and an intra-day high of 7.66 percent. It had ended at 7.60 percent on Thursday.
The partially convertible rupee was at 39.96/97 per dollar, weaker than 39.86/87 beforehand. It had ended at 39.87/88 on Thursday.
Daily NEWS
GLOBAL CUE IS WEAK HOPE MARKET WILL OPEN IN GAP DOWN,IF NIFTY DOES NOT HOLD 5050 CLOSE ALL UR LONG,LEVEL OF NIFTY 5100 IS CRUCIAL LEVEL,IF DOES NOT SUSTAIN 5100 MARKET COULD COME DOWN TO 4800-4700 LEVEL.FROM THEIR WE COULD EXPECT SHORT COVERING.IN TOTAL MARKET WIDE OPENINTEREST NIFTY IS HOLDING 50%.
Commonwealth Bank of Australia retreated to the lowest in more than two years in Sydney, while Mitsubishi UFJ Financial Group Inc. fell in Tokyo after UBS AG said losses in credit markets may reach $600 billion. Toyota Motor Corp., the world's second-largest automaker, dropped after a gauge of U.S. business activity fell to the lowest level since 2001 and the yen strengthened against the dollar.
U.S. stocks plunged on Feb. 29, capping the market's fourth monthly drop, after the National Association of Purchasing Management-Chicago said its business barometer contracted as production and employment weakened. The Standard & Poor's 500 Index declined 2.7 percent, the most since Feb. 5.
Statutory Liquidity Ratio bonds, a government instrument for meeting financial commitments, are likely to be issued to public sector banks for waiving off Rs 600-billion worth farm loans.
Commonwealth Bank of Australia retreated to the lowest in more than two years in Sydney, while Mitsubishi UFJ Financial Group Inc. fell in Tokyo after UBS AG said losses in credit markets may reach $600 billion. Toyota Motor Corp., the world's second-largest automaker, dropped after a gauge of U.S. business activity fell to the lowest level since 2001 and the yen strengthened against the dollar.
U.S. stocks plunged on Feb. 29, capping the market's fourth monthly drop, after the National Association of Purchasing Management-Chicago said its business barometer contracted as production and employment weakened. The Standard & Poor's 500 Index declined 2.7 percent, the most since Feb. 5.
Statutory Liquidity Ratio bonds, a government instrument for meeting financial commitments, are likely to be issued to public sector banks for waiving off Rs 600-billion worth farm loans.
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