‘India Inc’s Q1 revenue growth to hit 6-qtr low’

May Drop To 14% From 17.5% A Yr Ago: Crisil Mumbai: India Inc is expected to see a sharp slowdown in revenue growth during the current quarter, growing at 14%, the slowest in the last six quarters, compared to 17.5% during April-June 2011. The main reasons for the slowdown are the moderation in demand during the current quarter, the general slowdown in the economic activity and also in gross fixed investments, a report by Crisil Research noted.      "EBITDA (earnings before interest, taxes, depreciation, and amortization) margins are projected to decline by 100-150 basis points (bps) on a yearon-year basis to around 19-20%, but remain flat compared to Jan-Mar 2012 (Q4 FY12)," the report pointed out.      The revenue outlook for the full year 2012-13 (FY13) is also not so good as there are indications that it would grow at a pace slower than what was witnessed in FY12, that is lower than 16.7%, unless investments pick up. On the margin front, however, export-driven sectors like pharmaceuticals and IT companies would see some margin expansion, along with the telecom sector, which is purely domestic market focused.      Crisil Research also noted that there is a sharp deceleration in investment cycle, as investments in fixed assets are currently at the lowest level in the last five years. "At about 13%, growth in capex is the lowest in the last five years, reflecting investment slowdown. Deceleration in investment has lowered depreciation charges to a 10-year low," the report pointed out. Crisil analysts also are not expecting the investment cycle to pick up soon because of three reasons. These are the current economic uncertainty and the flux inthe Eurozone, continued policy logjam, delays in approvals and clearances, land acquisition related issues etc, and some likely delay in moderation of interest rates due to high fiscal deficit and inflation.      India Inc's interest coverage, the ratio of EBIDTA to interest expenses, is also at the lowest level in the last three years, because of high interest rates and margin pressures.  E-voting must for resolutions: Sebi  Mumbai: Market regulator Sebi on Tuesday said that e-voting should be mandatory for top 500 companies by market capitalization on the BSE and the NSE, making it cost effective for these companies and easier for their shareholders to participate in some of the decisions which were earlier done through postal ballot. The decision came as a follow-up to the Budget proposal to make e-voting mandatory for listed entities. Sebi said that the decision to move to e-voting would be implemented in a phased manner, and listed companies may choose any one of the agency which is currently providing the e-voting platform. TNN

At G20, India's PM vows to revive growth

Says Tough Steps Will Be Taken To Attract Investors, Hints At Subsidy Cut

NewDelhi:The UPA government is determined to take tough steps, including controlling of subsidies, to revive investor sentiment, Prime Minister Manmohan Singh said on Tuesday. 
    The tough talk on reforms comes a day after global ratings agency Fitch joined Standard & Poor's to cut the outlook on India's rating to negative from stable citing slowing growth, lack of reforms and weakness in public finances. The Reserve Bank of India (RBI), which kept interest rates unchanged on Monday, had also put the ball in the government's court and had talked about easing supply bottlenecks to tame inflation. "Like other countries, we too allowed the fiscal deficit to expand after 2008 to impart a stimulus. We are now focusing on reversing the expansion," Singh said at the plenary session of the G20 meeting in Los Cabos in Mexico. 
    "This will require tough decisions, including on controlling subsidies, which we are determined to take," Singh said. The RBI on Monday said it had frontloaded the policy rate reduction in April with a cut of 50 basis points and that this decision was based on the premise that the process of fiscal consolidation critical for inflation management would get underway, along with other supply-side initiatives. It also said subsidy burden on the government was crowding out public investment at a time when reviving investment, both public and private, was a critical imperative. The Prime Minister said the government will devise transparent policies which will provide a level playing field to both domestic and foreign investors. 
    The UPA government has faced strong criticism for its policy of retrospective taxation and handling of the Vodafone tax issue. Investors have slammed the government's unpredictable policies and have stayed on the sidelines. Economists have doubted the government's ability to meet the fiscal deficit target of 5.1% of gross domestic product for 2012-13. "Investment has been affected by the adverse global climate which impacts both foreign and domestic investors. We are taking steps to revive investor sentiment," Singh said referring to the slowdown in investment. "We are determined to create an environment that would boost investor sentiment and promote an atmosphere conducive to enterprise and creativity," he added. 
    Singh said the fundamentals of the economy remained strong and the government was confident of returning to a high growth of 8-9%. "Our growth rate in 2011-12 declined to 6.5% from the level of 8.4% in the previous year. This may look like a reasonable figure, given growth rates being experienced in the rest of the world, but our public is impatient for a return to high growth and faster jobs creation," he said. Singh also outlined the steps taken by the government to shore up infrastructure investment. "We are focusing heavily on infrastructure investment and in this context we have set ambitious targets to keep infrastructure investment on track and also put in place a problem resolution mechanism to overcome implementation bottlenecks," the Prime Minister said.

PM Manmohan Singh with German chancellor Angela Merkel at Los Cabos during the G20 summit on Monday