Companias

MARUTI UDYOG

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During 2004-05, MUL posted strong financial results. Its net sales grew by 20 per cent to Rs 10,910 crore and net profit rose by 57 per cent to Rs 853 crore over 2003-04. For 2004-05, the company achieved its highest ever domestic sales volume of 4,87,402 units, a rise of 16 per cent. MUL exported 48,899 vehicles to around 50 countries, including 10,623 units to UK, 5,792 units to Algeria, 5,657 units to Hungary, 4,192 units to Denmark and 3,193 units to the Netherlands. Spare parts and accessories business witnessed a growth of approximately 16 per cent in 2004-05 over 2003-04. Maruti’s market share in utility vehicles rose marginally to

2.95 per cent in 2004-05 as compared to

2.5 per cent in 2003-04.

MUL in collaboration with Suzuki Motors Corporation has established a new company, Maruti Suzuki Automobiles India for setting up a new manufacturing plant with a total investment of Rs 1,524 crore and an initial capacity of 1,00,000 cars per annum. The company is also setting up a new factory for manufacturing diesel engines, petrol engines and transmission assemblies for four wheeled vehicles. This project is being implemented by the joint venture company namely, Suzuki Metal India. The total plant capacity will be 3,00,000 diesel engines per annum which would be developed in phases. The initial annual capacity will be 1,00,000 diesel engines, 20,000 petrol engines and 1,40,000 transmission assemblies with a total investment of Rs 1,748 crore.

On the back of strong research and development Maruti introduced upgraded versions of the Esteem, Maruti 800 and Omni, completely designed and styled inhouse. To modernise the spare parts warehouse MUL implemented bar coding and an advanced information technology system. In compliance with the superior emission norms for vehicles introduced across the country, MUL launched Bharat stage III variants. The company is offering fuel efficiency on its cars and in a month’s time it is expected to launch the dual-fuel version of the WagonR that can also run on liquefied petroleum gas.

For the nine months ended December 2005, MUL reported healthy financial performance. Its net sales in value terms increased by 11 per cent to Rs 8,743 crore over the corresponding period a year ago and net profit reported a 39 per cent rise to Rs 828 crore, riding on higher profits per car, surging sales and on account of lower interest payments and depreciation. For April-December 2005, the domestic sale of vehicles increased by 8 per cent to 3,80,763 units. However, export volumes dipped by 29.7 per cent to 26,656 units over the same period of the previous year. Maruti Udyog’s sales for the month of January 2006 stood at 48,526 units in the domestic market, a growth of 7.1 per cent and exports declined 51 per cent to 1,583 units as compared to January 2005. GOODLASS NEROLAC PAINTS

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GNP registered a strong financial performance during 2004-05. Its net sales stood at Rs 879 crore, reflecting a growth of 15.6 per cent, and net profit surged by

58.6 per cent to Rs 92 crore, as compared to 2003-04. The company achieved healthy results on the back of better working capital management. During the year under review, the company successfully commissioned its greenfield plant with a capacity of 20,400 metric tonne per annum at Bawal in Haryana.

Kansai, the parent company of GNP, continues its support by providing inputs for the manufacturing process and latest technology. GNP also has a technical assistance agreement with a US-based company for automobile coatings, a Japanese company for manufacturing heat resistant paints and a German company for anodic electro deposition coating systems. GNP formed a joint venture with Japan’s Kansai Paint Company to acquire the paint business of a Malaysian company Sime Coatings Sdn Bhd. GNP holds a 55 per cent share in the joint venture company. GNP is targeting the premium paints segment by broadening its product portfolio. The company will introduce new products such as anti-bacterial finish paints. Another step in this direction is the launch of a new range of paints called ‘Nerolac Disney’ mainly aimed at children. The new product pack consists of two elements: paint for the wall and custom-made stencils of Disney cartoon characters, across all metropolitan cities in India.

GNP posted strong results for nine months ended December 2005. Its net sales rose by 14.6 per cent to Rs 776 crore and net profit jumped by 61 per cent to Rs 117.7 crore over the same period of the previous year.

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Economic and Political Weekly February 25, 2006

Lagging Behind

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Despite a rise of 11.4 per cent in net sales to Rs 675 crore during 2004-05, DCW’s net profit declined marginally by 1.6 per cent to Rs 21 crore over 2003-04. The company’s export registered a whopping 101 per cent increase to Rs 72 crore during the year under review. The sales turnover of the PVC division rose by 14 per cent to Rs 426 crore as compared to 2003-04. The caustic soda division registered a growth of 12 per cent in sales to Rs 217 crore during the year under review and soda ash reported a marginal increase of

1.6 per cent to Rs 122.8 crore over the same period of the previous year.

Seven out of DCW’s 14 new windmills in Tamil Nadu with a capacity of 11.2 mega watt, have commenced production and are selling power to Tamil Nadu Electricity Board. The remaining seven are expected to be commissioned by the end of 2006. In order to utilise the unfiltered waste effluent at the soda ash unit, the company has undertaken a project to manufacture calcium chloride, edible salt and regenerate water.

Despite a decline of 7.6 per cent in net sales to Rs 444 crore for first nine months ended December 2005, DCW posted an 11 per cent increase in net profit to Rs 17 crore, over the same period of the previous year. Division-wise soda ash’s sales revenue grew by 21 per cent to Rs 87 crore during April-December 2005; the caustic soda division reported a marginal 0.1 per cent rise to Rs 137 crore over the same period of the previous year. However, the PVC division’s revenue dipped by 20 per

Notes: P/E multiples are the latest with corresponding last year’s figures. cent to Rs 215 crore.

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Economic and Political Weekly February 25, 2006