The economics of the airline industry has always been a concern for stake holders. Deep N Mukherjee and Ashoo Mishra explore the various challenges involved in this sector. The airline industry is a sector where reputation, skill and luck do not play a major role. A case in point is Warren Buffet who lost heavily in his investment in US Airways. The challenges for the Indian aviation industry increase further on the back of regulationdriven cost inefficiencies and a nascent market.
Category: Infrastructure Finance
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Infrascape 2013 | Optimistic growth of steel
The overall performance of the steel sector is ‘optimistic.’ In the fiscal 2012-2013, growth in domestic steel demand is expected to be around five and a half per cent. The total demand is expected to be around 75 million tonnes, up from 71 million tonnes in 2011-2012.
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Infrascape 2013 | We do not expect any dramatic impÂrovement in 2013
The year 2012 has been a challenging year for the logistics sector as the economic slowdown affected manufacturing leading to general decline in the movements of goods across sectors like auto, commercial vehicles, heavy engineering and capital goods. Tight credit situÂation, no major policy reforms and weak demand made the situÂation further difficult for the sector.
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Quality Infrastructure a catalyst to Vibrant Gujarat
Gujarat is known as a land of entrepreneurs where development is given special importance. Its state-of-the-art infrastructure ensures stable growth which also attracts heavy investments for the state, writes Maheshwar Sahu. Infrastructure is the foundation for any industrial and inclusive socio-economic development. No country or a state can make holistic progress or attract foreign and national investments unless it offers quality infrastructure to support the growth.
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GIFT City – India's first financial hub
GIFT City is one of the most ambitious projects ever undertaken in the Indian infrastructure space and is being designed as a hub for the global finance services industry, writes Janaki Krishnamoorthi. Gujarat International Finance Tec-City (GIFT City ), a multi-service SEZ (Special Economic Zone) with dedicated center for financial services is under development in Gujarat.
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Investors would love to invest in India if we get our act right
There are mainly three reasons. First and the most immediate one is government departments are not paying in time. For instance, NHAI dues are aggregating upwards of Rs 25,000 crore. Some are disputed and others are not. If you ask NHAI they will deny any payments are due, but that is not the [right] answer. The government will need to be practical, in that somebody has done the work and money has been spent.
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Cost escalation ruins infra firms' hope
The rising finance cost has eaten into the profit margins of major infrastructure firms in the first half of the current fiscal year. Infrastructure companies have witnessed a sharp increase in their finance cost during April-September 2012. An analysis of the financial statements of 16 infrastructure firms shows financial cost going up because of huge debt, tight monetary policy and high risk perception.
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Restructuring must be done only when viability is not in question
Rather than having viability problems, infrastructure projects are typically “front-ended”, so it is often the mismatch between the lending and the project’s revenue-making tenures that lead to an increased likelihood of restructuring, says Arundhati Bhattacharya, MD & CEO of SBI Capital Markets in an interaction with Sumantra Das.
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IIFCL to raise funds via bond issue
India Infrastructure Finance Company (IIFCL) plans to use the fund raised through the forthcoming bond issue for long-term funding to PPP projects in sectors like power, infrastructure, etc, Chairman and Managing Director S K Goel said
The companyÂ’s Rs 1,500 crore bond issue with green shoe (over-allotment) option of up to the shelf limit of Rs 9,215 crore would open on December 26 and close on January 11. The bonds would be allotted on a first-come first-serve basis.
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National Electricity Fund
The Union Cabinet Committee on Economic Affairs (CCEA) has approved the setting up of National Electricity Fund (Interest Subsidy Scheme) to provide interest
subsidy aggregating to Rs 8,466 crore on loan disbursement amounting to Rs 25,000 crore to the State power utilities both in public and private sector, to improve the distribution network.