HM profits, sales up marginally

HM’s gross sales increased to Rs 1298.73 crore in 1997-98 against Rs 1253.34 crore in 1996-97. Profit before tax rose to Rs 48.30 crore for March 1998 from Rs 44.45 crore for March 1997. The net profit marginally increased to Rs 39.35 crore in 1997-98 against Rs 39.32 crore in 1996-97.

The auto division reported a fall in overall production numbers, with 26,684 vehicles produced in 1997-98 against 29,036 the previous year. Production at the power products division, which makes transmissionsets, also fell as some original equipment manufacturers reduced their orders. In a bid to boost sales, HM will be manufacturing an improved diesel version of the Ambassador, its old warhorse, with a 2000cc Isuzu diesel engine. The 2000cc Isuzu engine currently powers its Contessa car. HM also launched Trekkers with significant improvements, production of the jeep-like vehicle was increased to 3725 in 1997-98 from 2574 in 1996-97.

Other income and interest component rose to Rs 9.01 crore and Rs 58.32 crore in 1997-98 against Rs 5.52 crore and Rs 55.69 crore respectively in 1996-97. The total payout on account of the proposed 10 per cent dividend will be Rs 107.57 crore, the same as that last year.

The earthmoving equipment division at Tiruvallur and Pondicherry increased production to 646 units in 1997-98 against 609 units in 1996-97. Offtake by the cement and steel sectors was sluggish, but demand from the coal sector increased. The company is expecting a further rise in demand from the coalsector.

Production at the power products division at Hosur in Karnataka dropped to 940 transmissions in 1997-98 against 1027 in 1996-97. HM is likely to begin making its rural transport vehicle from July this year. The RTV is being manufactured in collaboration with Oka Motor Co of Australia. Shareholders of Hindustan Motors cleared the company’s proposals to increase its authorised capital to Rs 220 crore from the present Rs 160 crore and make a Rs 54-crore rights issue.