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Rallis back in the black

Our Bureau

MUMBAI, July 31

RALLIS India Ltd has returned to profitability in the first quarter of the current fiscal, with a net profit of Rs 20.36 crore as against a net loss of Rs 15.06 crore in the year-ago period.

The change is on account of an extraordinary profit arising out of the sale of its pharmaceutical business, amounting to Rs 18.14 crore. Besides, improvement in operating margin at 6.15 per cent (2 per cent) and a sharp reduction in interest costs also h elped the bottomline.

Interest costs declined to Rs 7.19 crore (Rs 15.61 crore). However, sales declined to Rs 194.06 crore (Rs 221.57 crore).

The company has embarked on a cost-savings exercise in the areas of purchase, manufacturing and logistics. It also put in place initiatives to improve productivity, improve quality and reduce waste.

``The net gains from this exercise are expected to begin flowing in this year itself,'' Rallis said.

The company has also taken steps to design appropriate systems to reduce debtor days, optimise price mechanism and discounts, improve efficiencies of sales and promotion processes and establish methods for direct contact with retailers and customers. ``T his will lead to enhanced sales and cost reduction in forthcoming months,'' the company said.