BUSINESS IN ASIA TODAY - MAY 28, 2009

Business in Asia on May 28, 2009. A summary prepared by Asia Pulse (http://www.asiapulse.com), the real-time, Asia-based wire with exclusive news, market intelligence and business opportunities:

HYUNDAI MOTOR STANDS TO GAIN FROM GM BANKRUPTCY: ANALYSTS

SEOUL - Hyundai Motor Co. (KSE:005380) may not have to worry much about a bankruptcy filing by General Motors Corp. as troubles at the world's No. 2 carmaker are widely expected to help the South Korean company boost sales in the U.S., analysts said Thursday. They note, however, that it is unclear whether Hyundai and its affiliate Kia Motors Corp. (KSE:000270) would be able to maintain long-term gains in the U.S. market if a restructured, post-bankruptcy GM regains momentum with more fuel-efficient compact cars. Early this month, Hyundai Motor Vice Chairman Yoon Yeo-chul said the South Korean auto industry should embrace the current turmoil in the global auto market as an opportunity to raise its profile and win sales worldwide.

PHILIPPINES' NAPOCOR TARGETS TURNAROUND TO PROFIT BY END 2009

MANILA - Philippines state-owned National Power Corporation (Napocor) is expecting to post a profit by end of this year after recording a net loss in 2008. Froilan Tampinco, president of Napocor, said the successful outcome of a billion global bonds issued by the Power Sector Assets and Liabilities Management Corp. (PSALM) recently was a clear indication that the year 2009 is expected to be good, despite the ongoing financial crisis. "It is possible (that) towards the end of the year, we might have a good financial picture," Tampinco told reporters." We expect a little profit." Jose C. Ibazeta, president and chief executive officer of PSALM, said the proceeds from the global bonds would be used to refinance maturing the debts of Napocor, which stood at US$6.8 billion as of end 2008.

INDIA'S JINDAL STEEL EXPECTS PROFIT TO DOUBLE

MUMBAI - Buoyed by an impressive growth in its power business, India's Jindal Steel and Power (BSE:532286) on Wednesday reported an over two-fold growth in consolidated net profit at Rs 30.07 billion (US$632.13 million) for the financial year 2008-09 and declared a dividend of 550 per cent. The steel maker also said the "worst is over" for the sector and its Rs 200 billion expansion plan is on track. The Naveen Jindal-led firm had a net profit of Rs 12.49 billion in the fiscal year ended March 31, 2008.

AUSTRALIA'S NEXUS ENERGY SELLS HALF OF GAS PROJECT TO AED OIL

PERTH - Australia's Nexus Energy Ltd (ASX:NXS) has sold half of its Longtom gas and condensate project offshore Victoria to AED Oil Ltd for $A155 million ($US120.25 million). The deal includes a 50 per cent joint venture interest in the VIC/P54 exploration permit, which surrounds the Longtom project. Completion of the transaction is subject to conditions, including AED obtaining debt financing for Longtom, a variety of approvals and Nexus completing construction of the project. AED said in a statement on Thursday that project construction was progressing well, with first gas and condensate production expected to start in July. Under the deal, Nexus will be paid an initial secured deposit of $35 million followed by a further payment of $120 million on completion of the transaction, which is expected to occur in September.

CITIBANK RULES OUT SELLING STAKES IN INDIAN, CHINESE BANKS

LONDON - Troubled financial services firm Citigroup, which was bailed out by the US government last year, has ruled out selling its stakes in Indian and Chinese banks, says a media report. In an interview with the Financial Times, Citigroup's Asia-Pacific region chief executive officer Ajay Banga ruled out selling the US group's stakes in Chinese and Indian banks. He added that the bank, which was rescued by the US last year, also planned to expand lending across the region, in spite of the "challenging" economic environment. The Asia-Pacific region, which for Citi includes Japan and Australia, accounted for 30 per cent of the bank's revenues last year, spanning corporate and consumer lending, credit cards, trading and private banking, the report said.

TOWER AUSTRALIA POSTS 12% DROP IN FIRST HALF PROFIT

SYDNEY - Tower Australia Group Ltd (ASX:TAL) has reported a 12 per cent fall in first half profit and says it remains positive about the prospect for continued growth in the life insurance market. Net profit for the six months to March 31 was $A27.1 million ($US21.02 million), down from $30.9 million in the previous corresponding period, Sydney-based Tower said in a statement today. But its preferred earnings measure, underlying profit, rose 13 per cent to $38.2 million.

JAPAN'S NORINCHUKIN BANK POSTS US$6 BLN FY08 NET LOSS

TOKYO - Norinchukin Bank said Wednesday that it incurred a consolidated net loss of 572.1 billion yen (US$6 billion) for the year ended March 31, its first fall into the red in 13 years, due to large impairment losses on securities holdings. Norinchukin, the central bank for agricultural and fishery cooperatives nationwide, is one of Japan's largest institutional investors. On top of 185 billion yen in losses on sales of securitized products and stocks, the bank's write-downs on such holdings reached 346.6 billion yen.

MALAYSIAN CARMAKER PROTON STILL OPEN TO ANY BENEFICIAL PARTNERSHIP

KUALA LUMPUR - Malaysia's national carmaker Proton Holdings Bhd (KLSE:5304) is open to any form of partnership, including with China's Chery Automobile Co Ltd, as long as it benefits both itself and the country. However, second national carmaker Perusahaan Otomobil Kedua Sdn Bhd (Perodua) said it currently did not need any other partnership. Proton's managing director Syed Zainal Abidin Syed Mohamad Tahir said it was interested in strategic partnerships regardless the automobile companies. "If there is interest from any company, including Chery, they have to approach us first. Then we will make our own fair assessment, whether it is good for our strategy and more importantly, what is good for the country," he said on the sidelines of the 2nd Annual Automotive Conference here Tuesday.

JAPAN'S NISSHIN STEEL TO CUT HEADCOUNT BY 9% TO ESCAPE RED INK

TOKYO - Japan's Nisshin Steel Co. (TSE:5407) will shed 9 per cent of its work force, or about 350 jobs, by 2011 through natural attrition. Hit by a serious decline in demand, the company expects to incur a net loss for a second year in a row in fiscal 2009. So it seeks to turn itself around by slashing personnel and other costs. The reduction will mostly target administrative positions, which total about 1,450 of the firm's present work force of 3,700 or so. The administrative staff's responsibilities will be simplified to enhance efficiency.

SRI LANKA HUTCH SUBSCRIBERS DROP 44 PCT IN YEAR TO MARCH

COLOMBO - Subscribers of Sri Lanka's Hutch, a unit of Hutchison, dropped 44 per cent to 772,000 in the year to March 2009 amid steep price cuts and an entry of a fifth operator to the market. "Our Sri Lankan operation continued to suffer from the adverse economic condition and the market trend of tariff reduction," Hutchison Telecom said in a statement. Hutchison said its customer base had fallen 18.6 per cent from 887,000 in the March quarter compared to the previous quarter. The yearly drop of 44 per cent was partly due to a 229,000 cut in subscribers in the 2008 third quarter as the firm tightened its customer recognition policy.

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