Business Daily from THE HINDU group of publications
Wednesday, Jul 12, 2006
Tinplate declares 12.5% dividend
Plans to expand
The company is augmenting its tinplate capacity from 1.8 lakh tonnes to 3.8 lakh tonnes per annum by setting up a new tinning line at an investment of Rs 210 crore
It may also set up a captive cold rolling facility for its tinning line
Kolkata , July 11
After a gap of 10 years, The Tinplate Company of India Ltd (TCIL) has declared a dividend of 12.5 per cent on both equity shares and non-cumulative optionally convertible preference shares of the company. Shareholders of the company approved payment of the dividend at the company's 87th annual general meeting held here on Tuesday.
Increased share capital
The company's shareholders also approved a resolution that increased the company's authorised share capital from Rs 276.50 crore at present to Rs 326.50 crore by the creation of five crore equity shares of Rs 10 each aggregating Rs 50 crore. The hike in the company's authorised share capital was described as a proactive measure to help raise funds for future projects, TCIL's Chairman, Mr B. Muthuraman, told shareholders. Issue of rights shares has been ruled out, at lease for the moment.
Mr Muthuraman said the company was augmenting its tinplate capacity from 1.8 lakh tonnes per annum to 3.8 lakh tonnes per annum by setting up a new tinning line of 2 lakh tonnes per annum capacity at an investment of Rs 210 crore. The investment on the expansion project would be generated from internal accruals and debt. The new facility would be operational by April 2008.
Later, speaking to newspersons, Mr Bushen Raina, Managing Director of TCIL, said the company was toying with the idea of setting up a captive cold rolling facility for its tinning line. Due diligence work on the proposed project was currently underway. Its implementation would entail an investment of Rs 400-450 crore. A firm decision on it would be taken within the next 5-6 months.
Mr Raina said the company was focused on increasing market share and leading the value chain by providing cost-effective, innovative and consumer-convenient packaging solutions for edibles. Towards this end, the company has recently set up a "Solutions Centre" with state-of-the-art printing and lacquering facilities at Jamshedpur.
On the outlook for the current fiscal, Mr Raina said production and sales would be better than in the last fiscal but margins would be under pressure on account of rising metal prices.
"As such, we would need to focus on costs and volumes", he said.
In 2005-06, TCIL earned an income of Rs 415.39 crore, up from Rs 263.48 crore in 2004-05.
The profit before tax in 2005-06 stood at Rs 39.50 crore (Rs 32.13 crore) even as the profit after tax in 2005-06 was Rs 48.96 crore (Rs 30.48 crore), including an amount of Rs 10.46 crore deferred tax asset being recognised.
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