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116 companies beat slowdown blues, bounce back

Deepak Korgaonkar

As many as 116 companies weathered the slowdown turbulence to come into the black during the year ended March, 2001. These star performers posted an aggregate net profit of Rs 3.49 billion during this fiscal against a net loss of Rs 6.67 billion.

The turnaround was possible primarily due to lower interest cost and for some better price realisation did the trick. The sectors that witnessed maximum turnaround cases were non-banking finance companies and textiles with 11 each.

Information technology had seven companies, six were from pharmaceuticals, five from paper and three from cement. Among 116, 29 companies were with a sales income above Rs 500 million, while 41 companies were with a sales income in range of Rs 100 million to Rs 490 million.

Cement giant Associated Cement Company posted a net profit of Rs 905 million during current year against a net loss of Rs 588 billion during previous year. Better price realisation and reduction in input cost helped the company to achieve positive growth in its bottomline.

Decline in interest cost by Rs 253 million and rise in sale income by 38 per cent to Rs 6.11 billion saw ITC Bhadrachalam Paperboard coming back into the black after continuous net losses over the last three years.

The company posted a net profit of Rs 349 million during the year against a net loss of Rs 321 million. The company spent Rs 418 million on interest cost in the current year against Rs 672 million spent in the previous year.

While other paper company Rama Newsprint and Papers posted a net profit of Rs 116 million during the current year against a net loss of Rs 222 million. The company, which had posted losses over the last four years, saw its sales income increase by 184 per cent to Rs 2.73 billion against Rs 962 million.

Higher volumes and sales turnover during the current year helped Narmada Chematur Petrochemicals post a net profit of Rs 199 million against a net loss of Rs 89 million during the previous year. The company posted sales of Rs 3.05 billion against Rs 1.99 billion.

Reduction in employee cost helped Esab India to post a net profit of Rs 97 million during current year against net loss of Rs 199 million.

The company had introduced a voluntary retirement scheme which reduced its staff cost by 25 per cent to Rs 150 million (Rs 198 million) during the current year. However, there was expenses of Rs 143 million owing to the VRS during the last two years.

American Remedies, Atul, Flat Products, Indo Rama Synthetic,and NEPC India are the other success stories aided by better topline growth and low input cost.

Among 116 companies, 42 companies' income from other sources cushioned the bottomline performance. Oriental Carbon, India Steamship,Rain Calcining, Zuari Industries, Agro tech Foods were the few examples.

Oriental Carbon posted a net profit of Rs 17 million against net loss of Rs 33 million. The company sold Rs 572 million of investments during the year. While Rain Calcining's raked in Rs 191 million as insurance claim. The company recorded a net profit of Rs 92 million during the current year against a net loss of Rs 412 million in the previous year.

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