Garden Silk Mills

a giftof free shares on a one-for-one basis, besides maintenance of a 20 per cent dividend for the year ended September 1987. The company has fared very well. Production at 4,795 tonnes registered a growth of 46 per cent over the previous year and sales at 4,532 tonnes were 33 per cent higher. This was possible on account of judicious product mix, installation of balancing equipment and consistent efforts aimed at increasing the company's market reach as well as creating newer end use applications for its products. In spite of severe competition, the company was able to step up exports from 940 tonnes to 1,746 tonnes. Besides increasing exports to western European market, a successful entry was made into the Australian and New Zealand markets. With increase in sales value from Rs 13.05 crore to Rs 16.60 crore, gross profit was up from Rs 1.85 crore to Rs 2.37 crore. Net profit amounted to Rs 98 lakh (Rs 71 lakh) providing a 5.16 times cover to the recommended dividend as against 3.73 times previously. The proposed free scrip issue will be made by capitalising Rs 96 lakh out of the general reserve. The directors point out in their report that the acute shortage of raw materials in the international market during the year has resulted in a sharp rise in the raw material prices and coupled with a high incidence of customs duty the landed cost of raw material has become prohibitive. The company however, was able to reduce the impact on margins by efficient raw material planning. It has applied to the ministry of industries for re-endorsement of the licensed capacity to 5,277 tonnes per annum.