Videocon posts 52 rise in net

VIL8217;s impressive performance was reflected in the National Stock Exchange where the scrip rose by 7 per cent from its previous close of Rs 115.25 to close at Rs 123 with about 27.85 lakh shares being traded. Total expenditure during the year increased to Rs 1,779.24 crore from Rs 1,546.77 crore and interest to Rs 128.01 crore from Rs 58.02 crore. Depreciation was up to Rs 70 crore from Rs 24.99 crore. The company8217;s operating profit and net profit margins were 15.59 per cent and 5.93 per cent compared to last year8217;s corresponding figures of 9.81 per cent and 4.78 per cent respectively.

The consumer electronicsindustry witnessed some severe price wars during 1997-98. The battle, especially in the colour television market, was keenly fought between Akai and Videocon with repeated price cuts and exchange offers. In fact, VIL ended the year by making an offer in March which promised to return the down payment to buyers after a specified period of time. Company executives say that the scheme was a runaway success with sales topping 1 lakh sets during the month.

The rise in it8217;s operating margins is attributed to higher volume growth due to increased market share in the second half. Moreover, the commencement of its glass shell picture tube project considerably reduced the production cost of colour televisions. VIL enjoys a market share of 32 per cent in colour televisions and 17 per cent in Bamp;W. Considering the current buoyancy in the scrip, the promoters might hike the price of Rs 140 for acquiring 2 per cent equity through an open tender.