ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Growth Despite Family Feud

these factors, the company, at 90 per cent capacity utilisation, projects a turnover of Rs 3.9 crore, Rs 5.8 crore and Rs 5.9 crore for 1993-94, 199495 and 1995-96, respectively, while the projected net profit for the three years is Rs 0.9 crore, Rs 1.5 crore and Rs 1.6 crore. Assuming that the above figures are achieved, the earnings per share would be Rs 1.58, Rs 2.67 and Rs 2.52 for the three years.

Focus on Entrepreneurship

oriented unit for manufacturing customised hi-tech industrial gears and gear boxes at Bahadurgarh, Haryana, in collaboration with Quebec Gear Works (QGWL), Canada, is the only project of its kind in the Asian subcontinent. QGWI. which is providing comprehensive support to the company by way of transfer of technology and know-how, supply of plant and machinery on deferred credit and equity participation to the extent of 15.42 per cent of the company's issued capital, has also entered into an arrangement with the company to buy back Canadian $ 25 million worth of goods or 75 per cent of the production per annum whichever is less. According to the company's CEO, Pankaj Khera, in Canada the labour cost comes to 40 per cent of the total production cost, while in India labour cost does not exceed 8 to 9 per cent of production cost. The plant and machinery has been supplied from Canada on a five-year deferred credit basis. Installation and trial runs which will be done under the supervision of QGWL technicians is to commence shortly. The project costing Rs 14,62 crore has been co-promoted by Haryana State Industrial Development Corporation with 10 per cent (Rs 65 lakh) participation in the Rs 7 crore post-issue equity. To part finance the project the company will enter the capital market on September 6 with a public issue of 38,37,000 equity shares of "Rs 10 each for cash at par. The projections made by the company place turnover at Rs 525 lakh, Rs 1,080 lakh and Rs 1,260 lakh and net profit at Rs 205 lakh, Rs 424 lakh and 1995-96 respectively. The company expects

Excise Relief for Cement

Excise Relief for Cement? Jairaj Kapadia SPECULATION is currently rife on the stock market that a cut in the excise duty on cement is imminent. This is after the expectations of the industry of a relief in this year's union budget did not come true. The excise duty on cement was hiked to Rs 90 per tonne in the 1991-92 budget. Even as the market is talking about the relief now coming, the industry has not said a word to this effect. But on the market the impression is showing. There has been a spate of buying in cement shares, although till now they were going abegging. Cement companies and others having taken to cement manufacture in a big way had reported a setback in both sales and profits.

Import-Substitution

Import-Substitution Jairaj Kapadia TITAN Witches, with a 60 per cent market share in quartz analog watches established for itself, has witnessed its profits slide in the face of increased sales turnover. Sales during the year to March 1993, expanded 23 per cent from Rs 15,501 lakh to Rs 19,121 lakh. But gross profit showed a marginal rise of Rs 26 lakh from Rs 1,784 lakh at Rs 1,810 lakh, while as a ratio to sales it declined more than two percentage points from 12.76 in the previous year to 10.51. Profit after depreciation and without a tax provision required to be made registered a decline from Rs 1,110 lakh at Rs 1,067 lakh. Since the company converted part B of the debentures issued in 1989 and also issued rights shares, the paid-up share capital increased sharply from Rs 2,684 lakh to Rs 4,228 lakh.

Profitable Acquisitions

Profitable Acquisitions BROOKE BOND INDIA, having come in the Lever fold and under the same chairman, S M Datta, has shown an urge for acquiring going companies. Hindustan Lever is taking over the second largest company in its field, Tau Oil Mills Company. Brooke Bond during 1992 took over Kothari General Foods Corporation under a scheme of rehabilita- tion-cum-amalgamation which was sanctioned by the Board for Industrial and Financial Reconstruction. It has since succeeded in acquiring UB group's Kissan Products by purchasing 10.712 equity shares of Rs 100 each representing 67 per cent of the shaft capital of the company. Meanwhile the boards of Tea Estates India and Doom Dooma India have unanimously approved the proposal for amalgamation of TEIL and DDIL with Brooke Bond with effect from January 1, 1993. The proposal has been approved by the shareholders of the three companies and is awaiting sanction of the High Courts at Calcutta, Madras and Guwahati. The proposed amalgamation is expected to bring in economies in Brooke Bond's operations and accelerate profitable growth.

Better Times Ahead

Better Times Ahead Jairaj Kapadia SPURRED by competition and driven by survival instinct but also helped by the tax concessions announced in this year's budget, automobile manufacturers are gearing to regain their lost position in the market due to demand recession and cost escalation.

Recession in Tyres

Recession in Tyres Jairaj Kapadia THE tyre company MRF has suffered a setback in profit after depreciation and in profit after tax during the year to September 30, 1992, while against an improve- ment in net sales of Rs 87 crore at Rs 662 crore, its gross profit has shown an increase of only Rs 3 crore at Rs 59 crore. The company declared a higher dividend of 75 per cent in three parts of two interim dividends of 30 per cent and a third of 15 per cent final dividend as against.60 per cent for the previous year. Since the year's dividend also covered an increase taking place in the share capital, the total dividend pay-out was more at Rs 306 lakh against Rs289 lakh for the previous year. But against that there was a write-back of earlier surplus provisions of Rs 505 lakh.

Prospering in Changed Fertiliser Scenario

Prospering in Changed Fertiliser Scenario Jairaj Kapadia GUJARAT NARMADA VALLEY FERTILISERS COMPANY (GNFC), Bharuch, has, recorded improved sales turnover and excellent production and capacity utilisation in 1992-93. This has been achieved despite annual shutdown of 27 days. Almost all products have contributed to increase in the sales turnover. GNFC has achieved a rare feat in the production of ammonium nitro- phosphate (ANP) during the year. In the second year of its commercial operation, the ANP plant has been run full steam with a capacity utilisation of nearly 100 per cent. This rare accomplishment has enabled GNFC to meet the challenge of providing phosphatic fertilisers to farmers, despite The Week's Companies market odds, thus ensuring essential balanced application of fertilisers.

Hurt by Cut in Public Sector Investment

Hurt by Cut in Public Sector Investment Jairaj Kapadia MANGALAM CEMENT is the first cement company to have declared its financial results fur the year ended March 31. As the results announced early in May were poor, the market was shocked. Now the company has released the report and accounts for 1992-93 and on going through that it is possible to examine the reasons for the setback in the results.

Gains of Liberalisation

Gains of Liberalisation OUTSTANDING performance has become customary for high profile Hindustan Lever, holding its sway in personal products and soaps and detergents and having diversified into chemicals (fluid cracking catalysts and functionalised biopolymers)and agriproducts (fertilisers and seeds). Its directors simply put the results for 1992 as 'satisfactory'. However, these illustrate the meeting of growth and profit targets by all sections of the company's business. Between them, in net sales, processed triglycerides accounted for Rs 121,927 lakh (Rs 105,407 lakh in 1991), chemicals and agriproducts for Rs 23,567 lakh (Rs 21,230 lakh) and exports, personal products and others for Rs 30,209 lakh (Rs 24,124 lakh) in the aggregate figure of Rs 175,703 lakh (Rs 150,761 lakh).

For Whose Benefit

to 7,500 tonnes per annum from the current level of 5,000 tonnes. This expanded production will be entirely consumed cap- tively. KSCL is setting up facilities at Karaikal for the manufacture of downstream products from PNCB/ONCB and dichlorobenzene. The products being proposed to be manufactured are in the area of dye and pesticide intermediates. This will result in captive consumption of approximately 2,000 tonnes of PNCB/ ONCB. KSCL will cross Rs 100 crore turnover in 1993-94 and with the full functioning of all the units, the EPS should move to over Rs 8 on the expanded capital To part finance the aforementioned plans the company proposes to issue capital of around Rs 23 crore. This will comprise 48,95,475 equity shares of Rs 10 each at a premium of Rs 35 per share on rights basis to shareholders; and 2,44,774 equity shares of Rs 10 each at a premium of Rs 35 per share to employees of the company and group companies. The issue has opened on April 30 and closes on May 31.

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