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Tuesday, May 31, 2005

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Harig Crankshafts bags Rs 150-cr Tata Motors' order

Virendra Verma

Mumbai , May 30

HARIG Crankshafts Ltd, an automotive components company, has bagged a Rs 150-crore order from Tata Motors that has to be executed in the next one year.

"We have already started dispatching the auto components to Tata Motors valued at Rs 1.5 crore every month and the total order size is Rs 150 crore," said Mr S. S. Bhagat, Vice-President (Finance), Harig Crankshafts.

"Forgings and crankshafts would be supplied for Tata Motors' trucks," he said.

To execute Tata Motors' orders, the company is undergoing an expansion of Rs 50 crore, which would be funded through Rs 25 crore of debt and Rs 25 crore of preferential issue of equity shares.

Harig Crankshafts has tied-up its debt requirements. The preferential issue is likely to be made to FIIs, Mr Bhagat said.

"Since our current capacity is not able to meet the full demand of Tata Motors, we are increasing capacities. This addition would be completed by March 2006," Mr Bhagat said.

He said the company's financial restructuring is complete, and by end of May the company would become a zero-debt company.

In the previous two financial years the company reported loss mainly due to the high interest cost.

For the year ended March 2004, its losses were Rs 51.76 crore on revenues of Rs 22.8 crore. In 2004-05, the losses came down to Rs 2.76 crore on revenues of Rs 29.2 crore.

"We are expecting to report profits in the first quarter and for the full year of this fiscal," Mr Bhagat added.

He said the company would be able to execute part of Tata Motors' orders in the current fiscal owing to the capacity constraints and the remaining in the next fiscal when the additional capacity comes in.

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