Running for the winning post

Aluminium giant Hindalco Industries of the Aditya Birla Group notched up a 27.3-per cent increase in turnover and a 26.9-per cent jump in its net profit and announced a dividend of Rs 5.25 per share. The rise in net is despite a 27.3-per cent drop in other income and a 47.9-per cent increase in the Aditya Birla Group company’s interest cost, reflecting higher quality of earnings. Netsales rose to Rs 1,473.3 crore against Rs 1,157.1 crore in 1996-97. Net profit increased to Rs 496.2 crore for 1997-98 as compared with Rs 391 crore recorded in the previous year.

But another group company Grasim could not perform as well. Its net profits shrunk by 16 per cent to Rs 231 crore for 1997-98. Its net sales though went up by 13 per cent to Rs 3,500 crore.

Orkay Industries Ltd, which was once considered a blue chip company, is on its death bed. The company has come under liquidation as it has not been able to pay back its dues. The Mumbai High Court has appointed its official liquidator as provisional liquidator of the company. Simultaneously, the Bombay Stock Exchange (BSE) has decided to stop trading in the shares of the company. The high court directive follows the winding up petition filed by the Maharashtra State Financial Corporation (MSFC) for recovery of dues to the tune of Rs 26 crore from Orkay. BSE has filed another winding up petition against the company for non-payment of listingfee for the last three years.

According to the law, the liquidator will value the assets of the company and auction it for repayment to creditors. Orkay has taken secured loans of Rs 125.57 crore and unsecured loans of Rs 40.10 crore from banks and financial institutions. The company, managed by Kapal and Jitendra Mehra, was finding it tough to manage the accounts in the last two years. It last finalised the accounts for the year ended March 1995 when it registered a total income of Rs 312.11 crore and a net profit of Rs 12.55 crore. Although the company announced 11-per cent dividend for the year, it could not pay the amount to investors due to financial crunch.

Housing Development Finance Corporation Ltd (HDFC) announced a good performance for the year and awarded a 75-per cent dividend to mark the completion of the company’s 20th anniversary. The directors have recommended a dividend of Rs 55 (55 per cent) per equity share for the year ended March 1998. This is Rs 10 more than last year. There is alsoa special `anniversary’ dividend of Rs 20 per share (20 per cent). The board has also recommended a dividend of Rs 12.50 per preference share on a pro-rata basis up to the date of redemption.

Announcing the performance of the fiscal 1998, the company said that the total income of the company had increased to Rs 1,444.68 crore from Rs 1,265.33 crore in the previous year. Profit before tax for the year increased by 12.3 per cent to Rs 351.36 crore compared with Rs 312.89 crore for the previous year. After providing Rs 58 crore for tax (Rs 65 crore), the profit after tax has gone up by 18 per cent to Rs 293.36 crore against Rs 247.89 crore last year.

Waiting for a word

The takeover bid for Indian Aluminium still hangs fire as the Government has not decided about its stand. The Core Group of Secretaries was expected to take a decision on allowing Canadian parent Alcan to increase its stake in Indal. But the crucial decision was put off.

The decision of the Government will determine how far Alcan iswilling to go to keep its Indian arm within its control. While Alcan has raised its offer price to match Sterlite, the decision of the Government could well determine the final outcome of the takeover bid.