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

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Growth through Diversification

Growth through Diversification Hansavivek LARSEN AND TOUBRO has widely diversified its activities in. various fields and is on the look-out for more suitable opportunities to expand and diversify to a still greater extent with a view to making further rapid strides on the path of growth. The management has identified the business of manufacture of and dealing in leather, leather goods, fish, seafoods and marine products, which have good scope for exports. The company has turned in good working results for the year ended September 1982 and is paying 20 per cent dividend as against 9 per cent paid for the preceding six months. The former subsidiary, Utkal Machinery, has been merged with the company and its working results are included in the latter's financial accounts. Sales have amounted to Rs 205.48 crore against Rs 82.63 crore for the previous six-month period and gross profit is Rs 28.63 crore against Rs 15.57 crore. These figures, however, reflect a sharp decline in profit margins, largely on account of increase in interest charges from Rs 1.77 crore to. Rs 11.24 crore due to purchase of ships and implementation of the cement project. Net profit is Rs 17.15 crore (Rs 7.02 crore), with the result that ratio of net profit to capital employed has nearly doubled. Increased dividend is covered 3.55 times by earnings as against 3.25 times previously. Internal generation of funds has been Rs 19.13 crore (Rs 6.16 crore). Order booking during the year at Rs 231 crore was higher by 23 per cent and order backlog at the year-end stood at Rs 188 crore. Consolidated turnover of L and T group of companies amounted to Rs 275 crore.

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