Market News

Everest Kanto Cylinders (EKC) is close to acquiring a US company for about $70 million.
Like EKC, the US Company also manufactures
compressed natural gas (CNG) and industrial gas cylinders. In October 2007, the
company raised $35 million through foreign currency convertible bond (FCCB) issue and
followed it up with a rupee funding worth $20-25 million. EKC could use these funds to
meet the acquisition cost.
On its way to become a leading CNG cylinder manufacturer with global scale, Everest
Kanto is on an ambitious expansion mode. It is building capacities at plants in India, China
and Dubai, and is currently seeing a $60 million capex plan.

Apollo, Ceat, MRF rev up to take on MNCs
Domestic tyre makers – Apollo, Ceat, MRF and JK Tyres – are expanding capacity, which
will take their combined capacity to 4.4 million units by 2010. This will help them to defend
their market share from the onslaught of global majors like Bridgestone, Michelin,
Yokohama, Goodyear and Pirelli, who are making inroads into the country’s Rs 19,000
crore tyre market.
Apollo Tyres is investing Rs 320 crore to increase the output. The company is
setting up a greenfield radial facility in Tamil Nadu for trucks, buses and cars.Besides, it has planned an off-the-road tyre facility in Gujarat.
Ceat Tyres, the country’s fourth largest tyre maker, will pump in Rs 800 crore to set up two facilities of 230 tonne/per day capacity.
JK Tyres, which has reportedly bagged the order for Tatas’ much-awaited Nano,
will invest Rs 150 crore in a new plant.
India’s largest tyre producer MRF is planning a new facility in Tamil Nadu.

Global Iron ore prices surge by 65%
Steel companies including Japan based Nippon Steel Corporation, JFE Holdings Inc and South Korea’s Posco have agreed to pay 65% .The world steel market is quite confident that it can protect its margins by passing on the rise in cost of inputs, including iron ore and steel. Given the decent demand growth, better pricing power due to consolidation, the steel sector has become more resilient in the past couple of years.
integrated steel companies like SAIL & Tisco which would not be affected by the surge in iron ore prices and in turn would command a better pricing as compared to its peers.