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

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Zuari s New Project

Zuari's New Project Hansavivek ZUARl AGRO CHEMICALS is joining hands with the government of Andhra Pradesh as a co-promoter for setting up a Rs 400 crore fertiliser project at Kakinada in A P. The project, to be undertaken by Nagarjuna Fertilisers and Chemicals, envisages manufacture of 900 tonnes of ammonia and 1,500 tonnes of urea per day and 81,500 tonnes of NPK in terms of P 205 per annum. The state government had approached Zuari, at the instance of IDBI, for collaboration in implementing NFC's project. The equity of the promoters of the project is reckoned at Rs 40 crores and Zuari and associates have agreed, subject to necessary approvals, to contribute to the promoters' share along with the state government in the ratio of 3 : 2. NFC will be managed by its board of directors. The number of directors representing the government and Zuari and its associates will be in proportion to their respective promoters' equity in the company The chairman of the company will be one of the directors representing Zuari. Zuari is seeking approval of its shareholders to invest Rs 12 crores in equity shares of NFC. Meanwhile, Zuari's own programme of debottlenecking at its plant in Goa is by and large on schedule. The commissioning of the scheme is proposed to be dovetailed with the annual turnaround. With the scheme becoming fully operational, it is expected that various constraints in achieving the rated capacity of the plant would be substantially removed and the company would be able to maintain efficiency at a high level despite ageing of the plant. The company has turned out good results for 1978-79 with higher profits despite lower sales. Equity dividend is stepped up from 10 per cent to 15 per cent, subject to the concurrence of senior lenders. The company's claim for tax holiday under section 80J of the Income-tax Act has been restricted by the ITO, and the company has filed ant appeal against the orders of ITO. The company is advised on the basis of High Court judgments and Tribunal decisions that its claim is likely to be upheld. The management points out that the new fair retention price does not give the expected 12 per cent return and the company has made strong representations for revision. K A Varugis, who had been on the board initially as a director and then as the managing director, retired from the board with effect from April 21 last. H S Bawa has been appointed as executive president.

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