Articles by Hansavivek

Mounting Losses Hansavivek ROHTAS INDUSTRIES has suffered the worst-ever setback in 1982-83 with a staggering trading loss of Rs 9.83 crore, against a loss of Rs 55 lakh in the previous year, following a decline in sales from Rs 88.11 crore to Rs 76.65 crore. With the fresh loss, accumulated deficit has mounted up to Rs 12.93 crore to stand against share capital of Rs 6.05 crore and reserves of Rs 93 lakh. No depreciation has been provided since 1977-78 and arrears on this account aggregate Rs 6.62 crore. Directors attribute this disappointing outcome mainly to the decision of the Bihar State Electricity Board (BSEB) to completely cut off power supply to the Dalmianagar complex from November 5, 1982 on grounds that the company had not paid dues claimed against fuel surcharge, imposed with retrospective effect from 1979-80, amounting to over Rs 3 crore. After prolonged negotiations at the instance of the State government it was decided to pay the dues in instalments, and, power supply was resumed after 5 months on April 4, 1983. During the period of total power cut, the company sustained partial operation of its cement and vanaspati units through its own meagre generation of power, which too was affected due to supply of coal with high ash content. Moreover, the breakdown of a steel turbine further hampered production. The company laid off its labour at Dalmianagar from November 5, 1982 and also served a notice to close down the paper and vanaspati units. At the State government's insistence, the management withdrew the closure notice as well as the lay off. Again, the company declared a lay off in the paper and vanaspati divisions on October 23, 1983 due to meagre supply of power by BSEB. This lay off was lifted 4 days later OP an assurance by the State government that the power supply would be im proved to at least 12 MW for the Dalmianagar complex. Workmen however continued their agitation even after the lifting of the lay off. They raised various demands and absented from work. A violent section of the workers assaulted senior officers and con- tinue to threaten loyal workers. The State government prohibited continuance of the strike on November 13 last. During 1982-83, the company's production of cement increased to 2,65,400 tonnes against 2,48,000 tonnes in 1981-82, but the output of all the other products declined

Modernising Paper Technology Hansavivek BALLARPUR INDUSTRIES has final- ised a Rs 80 crore scheme for full scale modernisation and renovation of its paper mills at Ballarpur and Yamuna- nagar. To be completed in about five years, the scheme is in final stages of discussion with financial institutions. The sixth paper machine at Ballarpur unit was commissioned in January 1983. This will augment capacity by 11,500 tonnes per annum of paper of lower grammages, industrial grades and specialities. Fifth paper machine at Yamunanagar capable of producing similar varieties of paper was commissioned in June 1983. During 1982-83, paper division produced 1,21,819 tonnes of paper as against 1,15,340 tonnes in previous year. COB licences for stationery works remain unaltered, as dompany's application for acceptance of installed capacity still awaits clearance of Central government. Production of coated papers declined from 7.069 tonnes to 6.715 tonnes due to frequent power trippings and load shedding. A second coating plant is proposed to be installed in May 1984. Production in Chlor Alkalisplants was affected by power cuts and erratic supply. Recessionary conditions in other industries induced a diminishing offtake of caustic soda, chlorine and hydrochloric acid which, coupled with commissioning of additional manufacturing capacity in different parts of the country, resulted in fierce competition and reduction in price realisations. The Singuch salt works produced 1,16,605 tonnes of salt against 72,369 tonnes in previous year. Production is now sufficient to meet requirements of company's chlor alkali plants. A bromine plant made wholly of glass and only one of its kind in India, litis been set up at Singach salt works and commissioned in June 1983. In a normal year, availability of bitterns will be sufficient, to produce 220 to 250 tonnes of bromine at this plant. Gokarna salt works produced 3.618 tonnes of salt against 4,959 tonnes previously. Vanaspati division produced 14,749 tonnes against 17,183 tonnes due to limited availability of imported and indigenous oils. Company introduced KM) per cent pure refined corn oil which met with quick success. but distribution had to be restricted on account of limitations in availability of raw materials. Shipping division, which has only one bulk carrier of L0,119 DWT completed 8 voyages against 3 in previous year and incurred a cash loss of about Rs 37 lakh against lis 67 lakh previously. Company is awaiting MRTP clearance for purchase of more ships which it will undertake at a more propitious time.

A Share of Automobile Boom Hansavivek KELVINATOR OF INDIA is establishing a moped factory in collaboration with Agrati-Garelli, Italy. It has already commenced production and sale of scooters at the factory of erstwhile ASV, since amalgamated with it. Company has in hand further expansion and diversification projects, which it is pursuing. As a result of R and D efforts, it has introduced a 2-door deep freezer-cum-refrigerator, which has heen well received in the market. Company has suffered a setback during the year ended June 1983 due to recession in the consumer durables industry. Although sales increased from Rs 49.08 crore to Rs 54.67 crore, gross profit slipped to Rs 4,73 crore from previous year's Rs 6.07 crore, reflecting heavy pressure on margins. Net profit is also lower at Rs 2.32 crore (Rs 3,26 crore). Unchanged dividend is still covered 5.80 times by earnings, but last year distribution had a hefty cover of 8.34 times. Production of refrigerators was substantially higher, but value of receipts lagged behind. Moreover, company extended credit covering sale of refrigerators and spent considerable funds on establishment and operation of scooter plant, advertising and establishment of a dealer network on country-wide basis.

Walking on Two Legs Hansavivek ITC has turned in good results for 15 months ended June 1983. Overall turnover for the period is Rs 759 crore compared to Rs 578 crore last year, representing a growth of 5.1 per cent on an annualised basis. Net sales realisations have crossed Rs 200 crore mark in 12 months for the first time with all round growth in company's main products and services, of which traditional cigarette business constitutes a 60 per cent share for the second year running. Gross profit has increased from Rs 21.49 crore to Rs 26.97 crore following net turnover of Rs 266 crore against preceding 12 months Rs 178 crore. Profit figure has been arrived at after setting aside on estimate, Rs 15.70 crore as 'extraordinary excise item'. A dispute exists between the company and excise authorities and the company's excise liability cannot be correctly determined at this stage. Net profit is Rs 8.77 crore (Rs 7.77 crore).

liven then, coming back to India, she has to prepare herself to face a situation where her access to IDA finance will be severely curtailed. Whereas in the past India was allocated as much as 40 per cent of the IDA credits (in fact, this has been the principal source of external aid received by India since the mid-sixties), now 40 per cent of the IDA funds would be shareable between China and India together. Thus, from July 1984 India must not expect to be in a position to tap this source or foreign exchange anywhere near on the scale reached in the past. While it is only right to face the situation forthrightly and not have any illusions about a last minute breakthrough, it also becomes necessary to make a realistic apprisal of the import capacity the country would, in the changed circumstances, really possess. Development castles built in the air can only meet one late, that is to crumble.