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

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Price Bounty

Price Bounty Hansavivek KIRLOSKAR BROTHERS fared very well during 1972-73 to show a net profit of Rs 35 lakhs against a loss of Rs 25 lakhs in the previous year. This outcome was made possible by the stepping up of production of all products, except hermetically sealed compressors. Increase in turnover apart, what helped the company to reverse the previous year's picture was the substantial widening of margins. This becomes clearer when viewed in the light of the fact that gross profit, as shown in the accompanying Table, was arrived at after making full provision for gratuity liability of Rs 50 lakhs against a mere Its 3 lakhs provided last year. Dividend was stepped up 4 points to 12 per cent, which was covered nearly 1.5 times. Even this did not please all the shareholders, for some of them had an "ye on the reserves and had been expecting a gift of shares. Recently, there have been rumours in the market that, instead of bonus .shares, the management might come out with a proposal to issue 'rights' shares at par in a small proportion. The scrip has been quoting at around twice its par value. The company's turnover during the current year has been rising, although demand for diesel engines and pumps has been affected by the steep increase in prices of crude oil and scarcity of diesel oil. The supply of electric motors has also been inadequate on account of shortage of essential raw materials required for their manufacture. Export demand for small pumps has been rising in recent months and this may partially offset the fall in home demand. Demand for hermetic compressors, which was poor last year, has also improved considerably. At the same time, efforts are being made to secure higher prices for the products to partially neutralise the effect of cost increase. Kirloskar Tractors, which made a public issue of Rs 150 lakhs in January last, ceased to be the company's subsidiary.

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