Telco net nosedives by a record 61%

The board of directors, which met in Mumbai today, have recommended a dividend of Rs 5.50 for 1997-98 as against Rs 8 given in the previous year.

This involves a payout of Rs 140.76 crore (Rs 200.61 crore).

The company’s scrip witnessed a bear run with the price falling to Rs 228.10 as compared to its previous clsoe of Rs 235.20. Theauto company is moving towards its 52-week low which is Rs 217.50.

Analysts say that Telco, which has been negatively impacted by a hike in excise duty in the union budget, is set for another turbulent year. The company has now pinned its hope on its small car codenamed `The Mint’ to arrest the sagging profits. The new car is scheduled for launch in late 1998. The company also launched a multi-utility model, the Safari, during the year which failed to stop its corroding sales.

The company claimed that its profitability was impacted by the significant downturn in the economy and in several segments of the industry. "The commercial vehicle sector is dependent on the level of industrial activity was devastingly affected," the company said.

It said in a statement that the company’s product mix witnessed a shift towards lower margin products. However, it took steps to contain the impact on its profit by pursuing cost reduction programmes.