Company chairman and managing director CK Mehta said the project is at a very infant stage and Deepak Fertilisers will definitely pick up a stake in it. This puts to rest beliefs to the contrary. Although he declined to commit, Nigeria is the likely African location since the consideration of a source for cheap raw material will be a major factor.

Deepak Fertilisers achieved sales of Rs 175 crore in the first five months of the current year. The company has targetted a turnover of Rs 400 crore for the current financial year. However, the 45 days of lost production during kharif 1998, when the nitric acidplant was closed, could adversely affect this target, he added.

Mehta, who addressed the company's annual general meeting (AGM) on Friday, told shareholders that Deepak Fertilisers will redeem its Rs 87 crore non-convertible debentures (NCDs) due in March 1999. But this will depend on the company's financial position, he added. The redemption will be reflected in the current financial year.

On the company's share holding pattern, Mehta said the management holds about 24 per cent, financial institutions (FIs) about 20 per cent, non-resident Indians (NRIs) around 7.5 per cent, while the rest is held by the public. The promoters will like to increase their stake by reducing that of the FIs, he said. Talks with the institutions were on and they are `sympathetic' to the company's request, Mehta added.

Speaking to The Financial Express, Mehta said the promoters will be `comfortable' holding about 30 per cent, but that will be a long drawn out procedure, under the Securities & Exchange Board of India (Sebi)guidelines.

Mehta reassured shareholders that the company will pay a dividend for 1998-99. It may be recalled that the company had re-entered the dividend paying list after a gap of six years. Its paid a 15 per cent dividend for 1997-98.

Mehta warned shareholders that the increase in gas prices and reduction in the selling price of methanol will have an impact on the company's profitability in the current year.

Having successfully revamped the CNA plant, with a 30 per cent increase in capacity, Deepak Fertilisers will undertake the revamping of the ammonia and methanol plants.

The speciality products introduced in the agro sector by Deepak Fertilisers will lead to `thicker bottomlines,' deputy managing director SC Mehta said. The manufacture of micro nutrients will be undertaken at Lonavala, while the sulphur-based will be closer to Taloja.

Deepak Fertilisers' strategic diversification into chemicals, explosives and fertilsiers will provide it long-term resilience, Mehta said. The company achieved asales turnover during 1997-98 of Rs 405.12 crore (Rs 292.98 crore) and a net profit of Rs 51.14 crore (Rs 29.15 crore).