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Today's Hot Stories - March 09, 2011

10 Headlines for Today

(1) DMK-Congress seat sharing impasse ends
(2) PM blames Prithviraj Chavan for Thomas fiasco
(3) Kate vs Catherine: Future queen puts UK in royal dilemma
(4) 1360 crore unclaimed funds in banks
(5) Sebi moves against RIL in takeover row
(6) Barclays chief earns £6.5m bonus: Bank
(7) New Zealand thrash Pakistan by 110 runs
(8) Messi inspires Barca to Arsenal win
(9) Lampard double keeps Chelsea in the hunt
(10) 48-mile cap for women travelling sans escort: Fatwa

5 Stories for Today

(1) Karunanidhi tests aspiring MLAs
(2) Gaddafi ready to quit for cash?
(3) Cognizant soars, Wipro, Infy muted in US market
(4) Apple iPad prices slashed in India
(5) Women battle it out with bulls and bears

(1) Karunanidhi tests aspiring MLAs

Like nervous students at a job interview, hundreds of aspiring MLAs gathered on the grounds of DMK headquarters Anna Arivalayam on Wednesday, waiting to appear before the selection committee headed by party supremo M Karunanidhi.

Dressed in white cotton shirts and veshtis, some braved the blazing heat and stood near the entrance hall while the rest sought shelter under trees. The air of anticipation was heightened by the party's stalemate with the Congress that finally ended later in the day.

The interview process was not too different from a regular job interview. Resumes were submitted and applicants ushered in to face a committee of seven people. Thovalai R Kumar, an applicant from Nagercoil in Kanyakumari said, "I was interviewed by the CM, Deputy CM Stalin, law minister Durai Murugan, and tourism minister Suresh Rajan. They asked me about my achievements in the party and my chances of winning." Other ministers including energy minister Arcot Veerasamy, finance minister K Anbazhagan and higher education minister K Ponmudi were also present.

Then were some who applied merely for the pleasure of meeting their leaders. K Karunanidhi from Kanyakumari said, "I have no intention of contesting but I wanted to meet the party chief once, especially since I am named after him. And my dream came true today," he said excitedly.

Party organisers had chalked out an ambitious schedule to complete the interviews of applicants from seven southern districts. "For today's interviews, they (organisers) had called in all the applicants from Kanyakumari, Tuticorin, Tirunelveli, Ramanathapuram, Dindigul and Theni," said a party source. But at 2pm, when the committee broke for lunch, they had just finished with the applicants from Kanyakumari, the first district slotted for the day.

"There are 300 to 400 applicants per district," said Selathurai, an applicant from Tirunelveli. Despite the committee spending just two to five minutes on each interview, most aspirants came out brimming with confidence. "I am definitely expecting to get selected," was a line parroted by many.

(2) Gaddafi ready to quit for cash?

Colonel Muammar Gaddafi has hinted that he is ready to quit Libya after 41 years in power, only if rebel interim council gives him a pile of cash and assures him immunity from criminal prosecution, a media report said.

The dictator is said to have proposed a meeting of the Libyan parliament to agree a transition period to pave the way for him to step down; his terms include immunity from criminal prosecution and a pile of cash, Britain's Daily Mail quoted Arabic TV network Al Jazeera.

Libyan rebels however ruled out any mediation with Gaddafi and demanded that he leave the country, as the regime rubbished any suggestion that it had made an approach.

Gaddafi allegedly sent Jadallah Azzouz Talhi, a former PM, to meet the rebels to work out the fine print of a deal. The offer proposed that the dictator would hand over power to a committee formed by General People's Congress.

Although it was unclear whether the issue of immunity for the man who has ruled Libya with an iron fist for four decades was raised, the head of the rebels' provisional national council said that they would not pursue criminal charges if Gaddafi quits. "If he leaves Libya immediately, during 72 hours, and stops the bombardment, we as Libyans will step back from pursuing him for crimes," Mustafa Abdel Jalil, an ex-justice minister, said.

He said that the deadline would not be extended beyond 72 hours. The council is based in the Libyan city of Benghazi. Asked about a Gaddafi representative making an offer of talks, former justice minister Mustafa Abdel Jalil and council chairman said that Gaddafi had not sent anyone himself, but that activist lawyers from Tripoli had volunteered as go-betweens.

"We will never agree to this. Gaddafi has killed women. He has killed children and he's killed our fighters," said Tariq Mohammed, operating one of the big anti-aircraft guns at the main Ras Lanuf checkpoint. "We're going to Tripoli and we'll win," he said.

(3) Cognizant soars, Wipro, Infy muted in US market

Over the last year, IT major Cognizant's stocks have outperformed the American depositary receipts (ADR) of top tier Indian peers Infosys and Wipro on the US markets by a big margin.

Between March 5, 2010, and March 4, 2011, Cognizant stocks on Nasdaq rose 55% to $76.32. Wipro's on the NYSE remained flat at around $13.45 and Infosys's on Nasdaq increased 17.5% to $67.67 during this period. Over the last three months, Cognizant stocks rose 9.5%, while Wipro and Infosys stocks fell 7% and 2.6% respectively.

"Growth is heavily rewarded in the US markets. That has helped Cognizant's stronger upward rally," said Ankur Rudra, IT sector analyst at Ambit Capital.

In the previous quarter, Cognizant's revenues grew 45% year-on-year to $1.31 billion. Correspondingly, Infosys grew 28.7% to $1.56 billion and Wipro grew 19% to $1.34 billion.

Cognizant narrowed the revenue gap with Wipro's IT services business to just $30 million last quarter from over $347 million in the Oct-Dec quarter of 2008. The company also inched up towards the Infosys' sales figures; Cognizant trailed Infy by $275 million in the previous quarter as compared to $418 million in the Oct-Dec quarter of 2008.

Cognizant's high growth is attributed to keeping operating margins at around 18-19%, lower than many of its Indian top-tier rivals. A significant amount of its earnings are reinvested into the business in the form of employee development, and sales and marketing.

Hari Rajagopalachari, executive director-consulting at PWC, said that Cognizant also shows greater income predictability. "Cognizant has consistently exceeded market expectations and is a low risk stock from an investor's perspective," he said.

On the other hand, Wipro's change in CEO created some worries over the company's future and added to the negative momentum on the stock initiated by the weaker earnings in recent quarters.

Though Infosys has been growing at a healthy rate, concerns about margin erosion, uncertainty about the management changes and the flattish guidance for the fourth quarter has limited the upside potential of the stock.

Some analysts say that as Cognizant is US headquartered and has a relatively greater proportion of employees based in the US, it gets the advantage of familiarity and favourable investor perception. This is seen to enable the company to win more deals in the US. The average trading volumes for Cognizant are also higher.

According to Ashish Chopra, analyst at Motilal Oswal, the investor interest in the Cognizant stock is also reflected in its higher price earnings (P/E) ratio. A higher P/E ratio means that investors are willing to pay more for each unit of net income. Cognizant was trading at a P/E ratio of 32.2 compared to Wipro's 28.74 at close of trade on March 4.

(4) Apple iPad prices slashed in India

Apple has slashed the prices of iPad in India. The company launched iPad in India in January this year, almost nine months after the tablet made its debut across several countries.

Less-than-two-month-old tablet in India got an updated version recently, with Apple CEO Steve Jobs unveiling the second-generation iPad in the US last week. Soon after iPad 2 unveiling, the company announced a $100 price cut on iPad in the US.

Seemingly under pressure, Apple India has also announced Rs 3,000 (close to $75) cut approximately on each model of iPad. The revised prices for the first generation iPad are as follows:

* 16GB Wi-Fi: Rs 24,500 (earlier price: Rs 27,900)
* 16GB 3G+Wi-Fi Rs 31,900 (earlier price: Rs 34,900)
* 32GB Wi-Fi Rs 29,500 (earlier price: Rs 32,900)
* 32GB 3G+Wi-Fi Rs 36,900 (earlier price: Rs 39,900)
* 64GB Wi-Fi Rs 34,500 (earlier price: Rs 37,900)
* 64GB 3G+Wi-Fi Rs 41,900 (earlier price: Rs 44,900)

The iPad 2 will hit the retail stores in the US on March 11 and on March 25 to 26, more countries, including Japan, Germany and Britain. No timeline has been announced for the iPad 2 launch in India.

However, iPad 2 (16GB, WiFi version) is available on eBay India for Rs 35,900.

(5) Women battle it out with bulls and bears

Mention stock market and one would associate Dalal Street and the share-trading game with men. But over the years, things have changed, and indications are that more is to come. The number of women investors currently may be minuscule but with the fairer sex earning higher incomes, having a better understanding of company balance sheets and terms like earnings per share (EPS) and price/earnings (P/E) ratio, the trend is sure to be more noticeable in the days to come.

Take the case of Aparna Ramchandra, 36, who started trading on an experimental basis six years ago, when during her MBA (finance) course she decided to apply her learnings to practice. "I borrowed some money from my father and relying on media reports and tips from external sources, invested a large chunk of it in shares. The rest I put in mutual funds," said Aparna, who runs a small outfit Rectify Credit, which assists people to work out their credit scores.

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