NTC turning around, aided by land sale, slimming plan
In challenging times, one does not expect bad to come good. But that is exactly what public sector firm National Textile Corporation is aiming for this year, reports Sumant Banerji.business Updated: May 22, 2009 21:13 IST
In challenging times, one does not expect bad to come good. But that is exactly what public sector firm National Textile Corporation is aiming for this year.
The firm that was founded in 1968, has been in the red for over three decades but courtesy some prime real estate in its armoury and a general weeding out of non performing assets, it is hoping to post an operational profit of Rs 57 crore in 2009-10 over a turnover of Rs 760 crore.
“We have been working towards this for quite sometime and the turnaround is finally upon us,” KR Pillai, chairman and managing director, NTC, told Hindustan Times. “We are in a healthy position now and have repaid all bonds and interest capital that had been accrued over the years. While we had been in the black two years ago due to the sale of mills in Mumbai, operationally we are still in the red. This year we would be in the positive zone.”
In terms of numbers NTC is now less than half its size in 2004. From 119 mills then, it now has only 24 mills. In 12 of them it is just a sleeping partner. In 2008-09 the company’s operational loss was Rs 133.40 crore over Rs 782.82 crore in 2007-08. NTC’s current turnover stands at Rs 538.50 crore.
“The sector in general is down right now, even more so for companies that are export oriented but we have our expansions in place,” said Pillai.
“It is becoming impossible now to make profits out of spinning alone so we are commissioning three greenfield integrated mills in Ahmedabad, Achalpur and Hassan. Thanks to the sale of our closed mills and assets, capital is no longer an issue.”
In 2005, NTC sold five mills in Mumbai to generate Rs 2,200 crore.