Bilt is scouting for a joint venture partner in this high-growth segment inwhich it currently does not have a major presence. Bilt plans to take the acquisition route to venture into the industrial paper business in a big way.

Bilt's group vice-president and chief financial officer B Hariharan told The Financial Express that the company was planning to set up a separate company for this business since the technology and the market for industrial paper was distinctly different from that of writing and printing paper. Putting the business in a separate company would facilitate the entry of a joint venture partner.

Bilt has set its sights on more than doubling its present paper capacity of 2.75 million tonnes per annum to six million tonnes per annum by 2004-5. With paper prices firming up by over Rs 900 per tonne inMay and June, Bilt has set a net profit target of Rs 45 crore in the next fiscal ending June 2000 on an estimated turnover of Rs 1,100-1,200 crore. Bilt will have a nine-month balance sheet this year ending June since it had extended its previous year to September 1998. Net profit for the nine-month period ending June 1999 is expected to be Rs 16 crore on a turnover of Rs 750 crore and an equity base of Rs 60 crore. Bilt's share price has risen over 300 per cent over the last three months from Rs 18 to Rs 62.

Bilt's group vice-president (people development and communications) Jagdeep Singh Khandpur said the company has drastically cut down its employee costs. The company has reduced staff strength to 70 employees from 300 employees at the corporate head office, which alone resulted in savings of Rs 14.50 crore. The total number of workers has come down to 11,500 from 13,200 about three years ago.

Hariharan said Bilt was also in initial stages of talks with some southern and western India-based papercompanies for acquisition. The plan is to acquire companies having a capacity of 60,000 to 80,000 tonnes per annum. Hariharan, however, did not disclose the names of the paper companies with which Bilt is negotiating.

Bilt is undertaking a modernisation programme at its existing paper manufacturing plants which would increase its production capacity by about 60,000 tonnes to 3.35 lakh tonnes per annum.

On the financial position of the company, Hariharan said the aberration in the debt portfolio of Bilt, which resulted in high-interest short-term debt being higher than long-term debt, had been set right over the past one year following which the interest costs of the company had come under control.

Bilt has retired short-term debts of Rs 100 crore carrying high interest rates in the last one year out of the Rs 190 crore loans raised from ICICI. The interest burden has come down to Rs 80 crore per annum from Rs 110 crore about two years ago. The company's total debt burden stands reduced to Rs 820 crore.