New Delhi, July 31: Indo Rama Synthetics (I) Ltd has reported a 23 per cent growth in net profit to Rs 8.22 crore for the first quarter ended June 2000, against Rs 6.7 crore reported during the corresponding quarter of last year.Turnover during the first quarter was up 17 per cent to Rs 479.84 crore against Rs 409.57 crore reported last year.Improvement in internal processes coupled with cost reduction measures helped the company improve its margins. Indo Rama's integrated efforts in the area of ERP and SCM for enhancing internal efficiencies through better systems and processes will help in making the company one of the lowest cost polyester producer.The company claims that the margins have been under pressure due to the import duty imbalance between the raw material and finished products, barring which, the profitability would have been higher. While the import duty on PTA and MEG is 27.5 per ecnt. It is 20 per cent on PSF adn POY, resulting in a negative duty differential.
For the year ended March 2000, improvement in Indo Rama's financial performance came on the back of volume growth, operational restructuring, hardening of polyester prices, improvement in export revenue and alteration of product mix.
Turnover during 1999-2000 was up 27 per cent to Rs 1,751 crore against Rs 1,375 crore reported in 1998-99. Operating profit improved by 116 per cent to Rs 266.64 crore from Rs 123.19 crore. The operating margins during 1999-2000 improved to 15.23 per cent from 8.96 per cent last year. Last year, Indo Rama reported a volume growth of 17 per cent against the industry's average growth of 8 per cent, thus increasing its market share to 18 per cent.
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