BMCs-Best Execs-r2:AMM grid in qxp 12/24/09 9:42 AM Page 48
AWARDS
ButtheUSFoodandDrugAdministrationwenttoinspecttwoofthe Thewaiverwasdulypassed,despitetheobjectionsofinstitutional
company’smanufacturingplantsandclearedonefully,whileofferingthe investors.
otheraminorobservation. ChatterjeefollowedwithaUS$500millionglobaldepositaryreceipt
DrReddy’susedthisasastampofapprovalasitpushesformorebusi- (GDR)programmeforTataSteelinJuly.TheLondon-listedGDRswere
ness.Withsomeoftheworld’slargestpharmaceuticalcompaniessettosee offeredata5.4%discount,andgainedenoughdemandthatthedealsize
thebiggestlossofpatentprotectioninhistoryoverthecomingtwoyears,it wasraisedfromUS$400million.
lookswell-placedtobenefit. PlusinNovemberChatterjeeandhisteamconductedanexchangeand
“Wehaveseverallaunchesnextyear,whicharemulti-yearannuities, offerofconvertiblebonds.ThedealsuccessfullyexchangedUS$493mil-
whichwillgiveusbothtop-lineandhighestabsoluteprofitsinourpeer lion,extendingoutTataSteel’srepaymentneeds.
group,”UmangVohra,chieffinancialofficer,toldthemediainearly AsaresultTataSteelhasriddenoutthenadiroftheglobalfinancialcri-
December. sisandhasnomajorrefinancingneedsforthenext18months–avital
breathingspace.
“YouhavetohandittoTataSteel’sCFO,”saysaheadofIndiaequity
LARGE-CAPCORPORATEOFTHEYEAR researchataninvestmentbankinMumbai.“Everyonethoughtthecom-
HDFCBank panywouldfacesometrickyfinancingissues,butthey’vedoneavery
goodjobmanagingthemthisyear.”
KeytoChatterjee’srolewillbetomakethecombinedcompanyprof-
Aperennialfavourite,HDFCBankhascontinuedtomeetitsownhighstan- itable.ItreportedanetlossofRs27.2billionforthequarterending
dardsinriskmanagementandbusinessgrowthamidvaryingconditions September,butChatterjeesaidthatTataSteelwouldsee“atrendreversal
overthepast12months. inprofitabilityterms”beforetheendofMarch.
Year-after-yearitoffersmoderategrowthobjectivesandarticulatesa
clearbusinessplanaboutitsobjectivesandtargetedreturnonequity.That
levelofclarity,andabilitytomeetthesetargets,doeswondersforreassur- INDONESIA
anceduringdifficulttimes.
“AroundthistimelastyeartherewereconcernsoverHDFC,aswellas SMALL-CAPCORPORATEOFTHEYEAR
thebroaderbankingsector,”saysoneanalystbasedinMumbai.“Butithas AKRCorporindo
continuedtodowell,largelybecauseitfocusesonmoderatelevelsof
growth.
“Thebankiscontenttolosemarketshareduringtheboomtimesaslong TojudgebytheprogressofIndonesianchemicaldistributorAKRoverthe
asitretainsitsassetqualityandkeepsitsnon-performingloans[NPLs]in pastyear,itwouldbehardtobelievetheworldhasgonethroughthenadir
goodshape.Andit’sbeenasuccessstoryastheeconomyrebounded.” ofaglobalfinancialcrisis.
Despiteaslowdownincreditdemandduring2009,HDFCBankreport- AKR’straditionalbusinessisthemanufactureofsweetenersorbitol,a
eda30.21%riseinitsnetprofitbetweenJuneandSeptembertoRs6.88bil- sugarsubstitute.Thecompanyhassteadilyincreaseditsearningsoverthe
lion,fromRs5.28billionoverthesameperiodlastyear. lastfewyears.AKR’snetprofitlastyearrosebyabout9%toRp210billion
Thebank’sincrementalloansgrewbymorethanRs90billion,whileits (US$22million).
retailbookstoodatRs625billion.HDFCBankdidwellintheautoloanssec- Butitwascompany’srecententryintoIndonesia’spetroleumindustry
toraswellasunsecuredlending,wherecompetitorshavepulledback thatmostcatchestheeye.Itwasatimelydecision,asdemandforoilhas
resources. surgedonceagain.
Meanwhile,ithaskeptbaddebtdownthroughstringentriskmanage- AKRshouldalsoberecognisedforitssuccessfulpushintothekeycoal-
ment.Thebankavoidedofferingloanstothecountry’sstrugglingairline producingregionofKalimantanthisyear.Theexpansionshouldboostits
sector,forexample. dieselsalestominersto1.1billionlitresthisyear,from670millionlitres
Onthebackofsoundjudgementandprofitability,thebank’sshares lastyear,accordingtoestimates.
havedonewell,althoughtheyfailedtooutperformtheoverallmarket.Its ThesuccessofthispushhasledanalyststoexpectAKR’sprofitstojump
sharesclosedatRs1,785.15,versusRs1,013.75atthebeginningoftheyear. toRp328billionforthefullyear.It’snosurprise,then,thatAKR’sshare
AnalystsbelievetherearestrongindicationsthatHDFC’sloanbookwill pricehasreturnedmorethan125%sinceJanuary.
accelerateinto2010,evenasinterestratesappearsettorise.Itlookslike Industryobserversarealsoexcitedaboutthecompany’sprospects.
anothergoodyearaheadforthebank. AKRstandstobecomeoneofthebiggestbeneficiariesofthegovernment’s
planstoprivatisethefuelindustrytomakeitmoreefficient.
Jakartastillsubsidisesmorethanhalfofthecountry’sfuelconsump-
BESTEXECUTIVE tionandAKRisoncoursetobecomethefirstdomesticprivate-sectorcom-
KoushikChatterjee,chieffinancialofficer,TataSteel panytodistributesubsidisedfuelinthecountry,alongsideinternational
oilmajorsShellandPetronas.
AKRpetroldistributioncapacityisalsosettodoubleoncompletionof
TataSteelwonplauditsforits2007takeoverofAnglo-Belgiansteelmaker newstoragetanksinJakartaattheendof2009.Coupledwiththegovern-
Corus.Unfortunatelytheacquisitionwasexecutedjustaheadofaglobal ment’sexpectedderegulationprocess,thefutureforAKRlooksrosy.
recession. “Thegovernmentmayacceleratederegulationwithapotentialtarget
TataSteeltookon£3.7billion(US$6billion)ofdebttopayforthepur- forafullyunsubsidisedmarketinfiveyears’time,”notesReinald
chase,raisingitthroughnewsubsidiaryTataSteelUK.Butitfacedmeeting Wangsanata,ananalystatCIMBinJakarta.“Thissuggeststremendous
financialcovenantsonthisdebtatatimethatitwaslosingmoneyand growthopportunitiesforAKR.”
banksandinvestorshadbecomerisk-averse.
ItistoKoushikChatterjee’screditthatTataSteelhandleditsfinancial
constraintsadroitlyandcutitsoverallleveragethisyear.FirstlyinMayhe MEDIUM-CAPCORPORATEOFTHEYEAR
persuadedlendersandinvestorstowaivethecovenantsontheTataSteel SemenGresik
UKloanuntil2010.
Thecompanyofferedanearly-birdfeeof75basispointstothose
whoagreed,whilepromisingtoinject£425millionintoitssubsidiary. Thepastyearhasseenasignificantdownturnindemandforbuilding
48 DEC2009/JAN2010 ASIAMONEY
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