According to the rating company, at least 20% of Indian company-issued foreign convertible bonds (FCCB) due for conversion this year are at risk for default. Investors are poise to cash in their bonds due to lackluster stock prices in India.
The majority of FCCBs at risk are in the IT and pharmaceutical sectors.
Fitch ratings named 19 companies most likely to default: GTL Infrastruction, Subex, XL Energy, Gayatri Projects, Indowind Energy, Pokarna Murli Industries, Sterling Biotech, Pyramid Saimira Theatre, KSL Industries, 3i Infotech, Zenith Infotech, ICSA India, KLG Systel, Ankur Drugs & Pharma, Gemini Communications, Pioneer Embroideries, GV Films, and Wanbury.
(Source: Economic Times)
Etisalat to end Indian operations following 2G scam ruling
Following Norway’s Telenor example, Abu-Dhabi’s Etisalat announced Wednesday that it would end its joint venture with Indian partner.
Etisalat entered India’s telecom market through a joint venture with the real estate company DG Group, forming Etisalat DB. Three weeks ago India’s Supreme Court canceled Etisalat DB’s license due to reasons of corruption.
Etisalat board unanimously decided to pull out of India altogether. The move will affect 1.67 million mobile suscribers of Etisalat DB. They have 30 days to transfer to another service provider. More unfortunate are the company’s employees, who will all be laid off.
Etisalat owns 45% of Etisalat DB. It plans to write off $827 million of its entire assets relating to Etisalat DB.
Meanwhile, top executives at DB Group and Etisalat DB are awaiting trial for the 2G telecom corruption scandal.
Etisalat might again invest in India "when there is clarity on the auction process and telecommunications policy and greater legal and regulatory certainty and stability,"
(Source: Economic Times, Reuters, Wall Street Journal)