Tisco looks for acquisition in allied fields

KOLKATA, JULY 15. Fresh from purchasing the ball bearings unit of Antifriction Bearing Corporation, steel major Tisco is looking for acquisition opportunities in selected steel and allied business fields.

"We are endeavouring to identify acquisition opportunities in selected steel and allied business fields and planning to diversify into promising areas that will provide synergy to existing business," Tisco officials said.

The ball bearings unit was purchased with a view to upgrade and expand its own bearings unit at Kharagpur. The acquired plant had a capacity to produce 10 million bearings, thereby enhancing the division's capacity to 25 million from 15 million numbers, the officials said.

They said the company was planning to enhance its financial position further by restricting capital expenditure to cover only essential balancing facilities, replacements and renewals.

Mr. Ratan Tata, Chairman, Tisco, had said that the company was geared up to face the global challenges, both within and outside India, following initiatives taken in the past with respect to modernisation, focus on high-end products substantial reduction in manufacturing costs and enhanced customer orientation.

The company had spent about Rs. 12,000 crores since 1980 in acquiring equipment and technology in four phases of modernisation. The officials were expecting that steel prices would show some improvement as production cutbacks were effected to correct the over-supply situation. "However, price recovery will be slow and the steel pricing structure will be highly competitive," they said.

Tisco would continue its process of cost reduction and moving up the value chain with an improved product-mix to reduce some of the downsides of steel business cycles.

The company had recorded net sales of Rs. 7,759.44 crores during 2000-01 against Rs. 6,890.87 crores in the previous fiscal and had managed a higher profit after tax of Rs. 553.44 crores against Rs. 422.59 crores.

- PTI

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