The overhaul includes moving out of its Mumbai corporate headquarters, putting its Mumbai and Chakan properties for sale as well as moving its Chakan manufacturing facilities to Dapodi, near here, and drastically reducing its workforce.

Managing director Eric Smith said he was sent to India specifically to get these operations in line with Atlas Copco's global policies. These measures would have been adopted even in a boom and had been effected keeping in mind long-term interests, he added.

The company, which is also emerging as a cost competitive supplier for the Swedish $4-billion Atlas Copco's global needs, is expected to benefit through the transfer of the rock-drilling equipment line from Sweden to India. The line includes chipping hammers, used in hand drilling for tunnels. Smith said there were chances of more product lines being transferred to the country if the price and quality were internationally competitive.

Atlas Copco (India) has a presence in the areas of construction and mining, water well drilling, air and gas compressors and electrical and pneumatic hand tools.

Smith, who took over as managing director in April 1997, successfully completed an early voluntary retirement (EVR) scheme in June 1998, which 107 employees accepted. Among his other moves was to re-locate the company's office from Mumbai to Pune and relocating the compressor technique factory from Chakan to Dapodi, near here.

Smith admitted that staff strength needs to be pruned further from the present total of about 540. The company has a surplus staff of 30 at the moment which would be reduced next year. This will be done partially through the on-going process of phasing out old machinery with newer equipment which is less labour intensive.

The EVR is expected to cost the company up to Rs 5 crore in the current year while the sale of the Chakan plant, which has not yet been finalised, is expected to yield around Rs 12 crore. The company has also put its Mumbai property on the block, at a reserve price of about Rs 8.5 crore.

Atlas Copco's performance during 1997-98 saw a sharp downturn over the previous year. Income from sales and service was Rs 127.8 crore (Rs 143.5 crore), other income Rs 4.8 crore (Rs 4.3 crore). Profit after tax stood at Rs 5.9 crore, against Rs 9.4 crore.

Smith was confident that this year's turnover will be higher at around Rs 2 billion, over last year's turnover of Rs 1.4 billion, mainly through exports to the countries of the region. While the first half order booking was substantially higher than that of the previous year, Smith declined to give figures.

The company is expected to increase turnover by about 30 per cent in 1998-99 while the growth in 1990-2000 would be largely a carryover of the current year. It is expected to have a cash surplus during the current year which will allow it to fund its heavy investments in machinery over the next several years.