Adding Another Dimension

Adding Another Dimension Hansavivek GWALIOR RAYON SILK MANUFACTURING (WEAVING) COMPANY proposes to further diversify into the fertiliser industry. It is seeking an industrial licence for setting up a gas based fertiliser plant for the manufacture of 4.5 lakh tonnes of ammonia and 7.5 lakh tonnes of urea per annum in UP. Meanwhile, the company has received offers from foreign technology sup- pliers for the sponge iron project. Further progress of the project depends on the clearance of matters of allocation and pricing of gas which are pending with the government. The construction work on the second cement unit for another half a million tonnes per annum is in progress and the erection work is expected to be completed by the first quarter of 1986. The clinkerisation plant of the first unit of half a million tonnes cement capacity was commissioned during 1984-85 in a record period of 18 months and about 3,000 tonnes of clinker was produced. The company has turned in good results for the year ended March 1985. It has earned a gross profit of Rs 28.41 crore on a turnover of Rs 380.57 crore against a profit of Rs 22.74 crore on turnover of Rs 318.27 crore in the previous year. These figures reflect increased gross margins. With provisions for depreciation claiming Rs 23.14 crore (Rs 12.65 crore) and tax liability Rs 55 lakh (nil), net profit has been halved to Rs 4.72 crore (Rs 10.09 crore). Equity dividend has been raised by 2 points to 22 per cent, which is slightly short earned as against an earnings cover of 2.25 times for the previous year's distribution. Sales of the viscose fibre divisions were 94,600 tonnes against 76,800 tonnes in the previous year. The offtake of Grasilene fibre was affected due to unrestricted imports and high incidence of excise duty. Production was only 4,960 tonnes i e, half the installed capacity. Production of pulp was also lower at 78,400 tonnes against 87,800 tonnes previously. The pulp plants at Mavoor and Harihar continue to face a serious shortage of pulp wood on account of non-fulfilment of their commitments by the state govern ments of Kerala and Karnataka. The Kama- taka government has finally agreed to a joint afforestation venture. A joint sector company along with Karnataka Forest Plantation Corporation has been formed for the purpose of raising plantations of suitable pulp wood species. In addition, a farm forestry project has also been taken up in that state with the assistance of N ABARD in an area of about 730 hectares. The farmers have already planted fast growing trees during monsoon of 1984. To assist these projects, the company has set up a Grasim Forest Research Institute at Kumarapatnam (Harihar) for developing nursery techniques and optimising the yield of wood. The directors point out that while the wood based industries in these states are facing serious raw material crisis, royalty on wood is being indiscriminately increased from time to time, the last one being made effective from April last. The incidence of royalties on pulp wood is perhaps the highest in the world.