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Thursday, Mar 31, 2005

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Jessop set to post Rs 4.5-cr net profit

Pratim Ranjan Bose

Kolkata. March 30

JESSOP & Co Ltd is set to end this fiscal with a net profit of approximately Rs 4.5 crore on a turnover of over Rs 70 crore. The company registered a net loss of Rs 6.38 crore on a turnover of Rs 45 crore during 2003-04.

The company registered a profit of Rs 2.12 crore during the first nine months of this fiscal against a loss of close to Rs 8 crore in the corresponding previous period.

The Chairman, Mr P.K. Ruia, told Business Line that the company's performance had suffered during 2004-05 because of lack of supplies from railways and railway approved manufacturers.

"Our delivery schedule for coaches suffered due to short-supply of wheels from the Railways," Mr Ruia said.

As against a total order for nine rakes, Jessop had so far dispatched only one. "If wheels are available, we will supply the rest in three-four months." The coach division is the biggest profit earner for the company.

The wagon section had under-preformed too due to short-supply of bogie and coupler from Railways-approved manufacturers. Against an order for 305 wagons, the company could deliver only 65.

While the Railways is expected to convert bogie and coupler into a free supply material from next year, Jessop recently acquired the plant and machinery of the closed foundry of Mukand Ltd to set up a bogie and coupler plant at Durgapur in West Bengal.

The new plant is expected to pave the way for higher capacity utilisation of the wagon division in 2005-06. The plant is expected to be commissioned in six months.

"Had wheels and bogie and couplers been available, Jessop could have easily ended the year with a net profit of Rs 7-8 crore," Mr. Ruia said.

Meanwhile, the company has bid for acquiring a dry dock at the Kolkata Port Trust on a long-term lease for setting up shipbuilding and ship-repairing facility. Efforts are on to secure business for the revamped mining division.

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