The Hindu : BEML's new strategy

Online edition of India's National Newspaper
Tuesday, Dec 03, 2002

Business

Business

BEML's new strategy

By Our Special Correspondent

BANGALORE DEC. 2. Bharat Earth Movers (BEML) is reworking its strategy as the company's bottomline was none too good and the measures it is looking at include cutting costs; reducing inventories (which now stood around Rs. 600 crores); collecting dues from sundry debtors (about Rs. 500 crores) and the like.

Giving details of the measures the company was taking, the new Chairman and Managing Director, V. RS. Natarajan, told presspersons here today that low margins had been a factor for the profit before tax being around Rs. 13 crores (profit after tax Rs. 5.35 crores) of the total turnover of Rs. 1,424 crores last year. The expected turnover this year is Rs. 1,675 crores. The wage revision the company had effected in 1997 entailed an outgo of Rs. 172 crores, besides the annual recurring expenditure of Rs. 72 crores. About 1,500 employees had opted for the VRS and the employee strength now was 13,165.

Mr. Natarajan said being a public sector unit under the Defence Ministry, BEML was refocusing its attention to increase its business exposure to the defence sector, up from 47 per cent last year to over 50 per cent this year. Of the Rs. 2,013 crore order book as of October, the defence accounted for Rs. 1,600 crores.

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