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Philippines' Cebu Air Flies High on Debut

This is a transcript of top stories presented by China's CCTV Business Channel as produced by CNBC Asia Pacific.

A big hello to our viewers across China,

I'm Saijal Patel from CNBC and you're watching “Asia Market Daily”.

Shares in Philippine budget airline, Cebu Pacific soared as much as 6.4 percent on debut today.

The largest IPO in The Philippines, by dollar value - was heavily backed by overseas investors.

CNBC's Elvina Simpson reports.

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Foreign investors are continuing to pour their funds into emerging markets - with overseas investors picking up 70 percent of the budget carrier's offer.

Cebu Pacific - the airline unit of conglomerate J-G Summit - has raised $611 million. Most of that will be used by its parent - to reduce debt.

The airline - which flies 16 Asian routes, including to Beijing and Shanghai - has picked the perfect time to list.

The local sharemarket has soared more than 40 percent so far this year beaten only by Indonesia in the Southeast Asian region.

(SOT) Peter Harbison, Executive Chairman, Centre for Asia Pacific Aviation:

"The Philippines is a very difficult place to get around the surface, so it's idea for an efficient low-cost operation to really to tap into that market.”

And it's aiming for the skies, planning to use its share of the IPO pie to buy more planes from Airbus - to ramp up competition with Singapore's Tiger Airways and Malaysia's Air Asia.

(SOT) Peter Harbison, Executive Chairman, Centre for Asia Pacific Aviation:

"It's in a very powerful position. It's a good airline. It's got a good reputation. It's got a reasonably good network at the moment, which is about to expand off the back of this IPO.”

In a CNBC exclusive interview, Cebu Pacific's President and CEO said a massive push is underway to grow its international operations.

Lance Gokongwei, President and CEO of Cebu Air:

"We are projecting to grow our domestic business by 15% a year for the next four years, and our international business by between 25 to 30% a year for the next four years. Our relative market share on the international routes are still relatively low at 15%. We think we can easily build this up to about 30% in the next four years as the economy continues to grow and more Filipinos enter the middle class.”

And Cebu is looking to China to help meet those international growth targets.

”Already there are over 600,000 Korean tourists who arrive to The Philippines every year, yet we look at the comparative market in China and it's only at 150,000, and certainly no one believes that China should be smaller than Korea in five years time.”

Elvina Simpson, for CNBC Asia.

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The past weekend saw a proposal that will see a sizeable power shift at the International Monetary Fund.

If approved, nations such as China, India and Brazil will have a stronger voice within the fund, something that the State Bank of India's Chairman, Om Prakash Bhatt tells CNBC his country is ready for.

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Bhatt: Things change. Things don't remain the same. As we've seen over the last two or three years, it's become increasingly clear that the bulk of economic activity has shifted to the east. And in the east it's countries like India and China. Coming from India, I know a little bit more about India. I think the growth that is happening there, not only is universal, happening across all segments, all economic segments. But I think it is far more sustainable in the long run. So which means that, over time, countries like India and China will continue to grow at rates which are maybe two to three times higher than the rest of the world, particularly the mature economies. So I think it right that the shift has taken place. These counties can and should take more responsibility

Anna Edwards: Some finance officials from parts of the emerging world have expressed concerns about bubbles being created in their currencies, specifically the Brazilian Finance Minister. Do you think that as an Indian businessman that that's something that worries you... a bubble being created in the Rupee?

Bhatt: No. what has happened is there has been huge inflows of FII and FDA money into India, and this year the inflow has been much larger than in the earlier years. But I think partly it is because foreign investors are rebalancing their portfolios and obviously they find India an attractive market. Partly also this is a large amount of disinvestments taking place from the public sector companies, which are owned by the government. And this investment is you know for billions of dollars, not to get a sizeable chunk of that, when you apply for it, you apply with a multiplier of three, four, five times. So I think some of this money could be just positioning itself to take part in the India growth story, and I don't think it's you know, going to stay there permanently and therefore cause bubbles.

Edwards: How self sustaining is the growth story in India do you think, because we talk a lot about just how connected the world is and whether any king of decoupling is possible. As we see economists increasingly worry about US and western Europe once again slipping back into possibly recession. Do you think that the growth engine for India can continue?

Bhatt: Yes, and the reason is that India is largely driven by domestic demand. Today the extent of the world economy grows slowly, or does not grow at all. To that extent, our export related businesses and that part of the economy may be a little slow and therefore it will drag down the entire economy by that extent. But domestic demand is so huge. If you have our infrastructure in place, and if we have other enablements such as the banking system in place, I see there is no reason why we should not grow at least 8%, maybe 8.5%.

Edwards: Do you think the regulatory efforts that the world is making are moving in the right direction?

Bhatt: Yes. What's happening is that it's really caution that has been exercised and so what is happening is that when banks do business, the kind of business they've been doing, they'll be forced to be more restrained on account of capital and liquidity. So in that sense, it's a step in the right direction. But if the steps were to be confined to regulation mechanism, and not to address other issues around the system that causes problems in the first place, they it would not be sufficient. So this is a necessary step, maybe not sufficient.

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That's the latest “Asia Market Daily”.

I'm Saijal Patel from CNBC, enjoy your night.

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