All Well Except with Labour

All Well Except with Labour Hansavivek VOLTAS has fared so well during 1979- 80 that it has not only stopped up dividend by 3 points to 18 per cent but has also proposed a free scrip issue on a one-for-four basis by capitalisation of reserves of Rs 1.58 crore, What is more, the directors have recorded their intention to maintain dividend payment at a level of 15 per cent on the enlarged capital. Net sales have risen by 16.8 per cent, from the previous year's Rs 201.50 crore to Rs 238.87 crore. Gross profit has leapt by 49.3 per cent from Rs 2,80 crore Rs 5.18 crore. Net profit has shown a .still hefty rise to Rs 3.68 crore from Rs 2.06 crore, and the enhanced dividend is covered 3.20 times against 1.91 times previously. As much as Rs 2.5 crore have been ploughed back to general reserve. Reserves now stand at Rs 9.83 crore against share capital of Rs 0.29 crore. It may be recalled that the company had received severe knocks since 1974-75 and that by 1976-77 its profits had phunmetted to a mere Rs 10 lakh so that the shareholders were paid a dividend of only 7 per cent. Since then, the management has adopted a long-term plan of action to correct the downward trend in profitability. This has brought about a gradual change in the company's fortunes. The overall results lor 1979-80 would have been much better bur for the absorption of substantial losses incurred by the erstwhile Tata-Merlin and Gerin (now the switch- gear plant of, the company) and the National Electrical Industries (now the motor transformer plants), since amalga- mated with the company. At the same time, these amalgamations have provided large tax reliefs. No tax was payable for 1978-79, and the tax liability for 1979-80 is only Rs 50 lakh. Profits of the current year will bear the normal tax incidence. Measures taken for rehabilitating the operations of the amalgamated units are already showing positive results and the directors feel that in the current year these units should not materially depress the company's profitability. Efforts are continuing to effect amalgamation of Wandleside Na- lional Conductors with the company.