Profitless Yarn

Profitless Yarn Hansavivek INDIAN RAYON last year stepped up production of rayon yarn from 2,662 tonnes to 3,467 tonnes, but this was still short of the installed and licensed capacities of 3,650 tonnes and 4,000 tonnes, respectively, though the company has completed 15 years of existence. It is stated that now the factory is producing at the rate of the installed capacity and that some balancing equipments for improving quality and removing other deficiencies are either on order or are under erection. Gross profit more than doubled at Rs 144 lakhs (Rs 68 lakhs) but this was just enough to provide for part of the arrears of depreciation and for development rebate. There are still arrears of depreciation amounting to over Rs 316 lakhs and of preferential dividends Rs 86 lakhs. The last date of redemption of 18,480 ten per cent redeemable cumulative preference shares of Rs 100 each has been extended to June 11, 1975, subject to the consent of government. Of these shares, as many as 18,360 are held by Gujarat State Financial Corporation. The company's application for a letter of intent' to manufacture 10 tonnes of transparent cellulose film per day has not been approved by government "without specifying any reason". The application for a 'letter of intent' to manufacture 50 tonnes of rayon grade caustic soda per day is still pending. According to a fresh agreement between rayon yarn spinners and weavers, the company has to supply for two years from January last 40.33 per cent of its production to weavers at fixed concessional price in plate of 35 per cent under the old agreement. In addition, in common with other rayon spinners, the company has to supply as before upto 10 per cent of its production to exporters of art silk fabrics at even more concessional rates.