BEM eyes US tie-up, plans share issue
Bharat Earth Movers Ltd is in talks with US-based heavy equipment maker Terex Corporation for manufacturing dump trucks, the Indian state-run firm's chairman said on Friday.
The maker of mining equipment also plans to raise up to Rs 5 billion in a public issue of shares before September, Chairman and Managing Director VRS Natarajan said on television.
Bharat, which also makes defence and rail equipment, has set a revenue target of Rs 25 billion for the coming year that begins on April 1, with a fifth of this coming in the first quarter, he said.
Sales rose 18.6 per cent to Rs 22.02 billion in 2005/06, the company said in a statement. Profit before tax was Rs 2.8 billion , it added, but gave no comparison for the year ago.
Shares in Bharat were down 8.6 per cent at Rs 1,493 in the afternoon after rising about 47 per cent since the start of January.
The company is diversifying into engineering design software and marketing third party products to boost revenue to Rs 50 billion by 2013/14, it said.
Bharat expects order book, now at 25.5 billion rupees, to rise to more than Rs 40 billion in the coming financial year.
"There are a large number of orders coming up in mining," Natarajan said. "There are also the metro rails coming up in Bangalore, Mumbai, Cochin and Hyderabad."
He said the company was expecting an order worth Rs 15 billion from the Delhi Metro Rail Corporation.
It is also setting up a research and development centre for metro rail systems at Bangalore. A joint venture with Rotem of South Korea is being considered for manufacturing frames for railcoaches.
The company plans to open operations in Morocco and Indonesia, besides the two offices at Singapore and Shanghai. Export revenues during 2005/06 were Rs 630 million , the company said.