The company had managed to rake in a net profit of Rs 3.20 crore during the same period last year despite adverse conditions.

"Higher interest cost and textile industry slump contributed heavily to the loss," a Mafatlal Industries release said. Interestingly, interest at Rs 126.05 crore is much less than the last years' figure of Rs 159.12 crore.

"The year ahead will be better as the company is in the process of implementing a restructuring programme. The funds generated from real esate sale and Nocil demerger will be deployed for the recast," company sources said. Incidentally, the company has signed an agreement with Anglo Dutch major Shell for a new joint venture after a three-way demerger of Nocil.

Net sales sank to Rs 829.77 crore inthe current fiscal from Rs 1,032.39 crore during the last year.

Other income dropped to Rs 163.25 crore from Rs 1,032.39 crore. Expenditure was also down to Rs 724.44 crore from Rs 1,065.65 crore. Depreciation slipped to Rs 29.35 crore, as compared with Rs 40.96 crore. Paid-up equity share capital remained at Rs 49.99 crore.

The restructuring plan includes the setting up of captive power plants with a capacity of 17mw, an investment of around Rs 150 crore for the processed fabrics divison, downsizing through voluntary retirement scheme, export business restructuring and expansion of garment business.

The company might construct a centralised power plant as the Gujarat governemnt has recently allowed free wheeling of power in the state.

Exports will be the future area and the company has kicked off the process of converting one of its facilities entirely for exports in addition to the existing plants.

Garments will be provided extra thrust with the company's Bangalore facility being expanded to meetlong-term requirements. The restructuring is undertway in other units too with the company recently selling of 49 per cent stake in the intravenous fluid joint venture.