Our Bureau

Mumbai , June 27

MR Mukesh Ambani, Chairman of Indian Petrochemicals Corporation Ltd (IPCL), said there were no immediate plans to merge the company with Reliance Industries Ltd (RIL). He was speaking at the 36th annual general meeting (AGM) of IPCL in Vadodara on Monday. Rumours of an imminent merger between RIL and IPCL that had been doing the rounds among investors for the past couple of days were dashed at the AGM. Though there was no intimation of such a proposal to the shareholders and it was not on the agenda of the AGM, the matter was raised by some shareholders to which Mr Mukesh Ambani responded by saying "not at present."

The markets, rife with rumours that a merger could well be on cards, responded with the scrip opening at Rs 169.90, climbing to a high of Rs 189.75 and closing at Rs 176.85. The board recommended a 45 per cent dividend for 2004-05, constituting a pay-out of Rs 112 crore.

There were only seven out of 11 directors in attendance at the AGM, with Mr Anand Jain being notable among the absentees. According to reports that emanated at the time of settlement of ownership last week, it was indicated that Mr Jain would be stepping down from IPCL.

However, till date, there has been no communication to this effect to the stock exchanges and hence, Mr Jain still continues to be on the IPCL board. Among other absentees were Mr Shailesh Haribhakti and the two Government nominees — Mr R. I. Singh and Mr G. S. Sandhu.

Mr Ambani announced fresh investments of Rs 485 crore to be completed by the middle of the next fiscal. This includes increasing the Vadodara cracker capacity by 12,000 tonnes per annum (tpa) of ethylene, benzene capacity by 14,000 tpa and the PVC plant capacity will be raised from 245,000 tpa to 315,000 tpa. The Gandhar gas cracker capacity will be increased by 65,000 tonnes per year of ethylene, polybutadiene rubber by 6,000 tpa and dry spun acrylic fibre plant by 6,000 tpa.

According to Mr Ambani, IPCL has already commissioned expansion projects worth Rs 125 crore that has led to an overall production increase of 11 per cent. This includes expansion of the existing MEG plant at Gandhar by 157 per cent to 188,000 tpa, chlor-alkali plant by 25 per cent to 170,000 tpa and the acrylonitrile plant at Baroda by 17 per cent to 42,000 tpa.

Over the three years since taking over IPCL, the net profit has gone up from Rs 107 crore (2001-02) to Rs 786 crore (2004-05), he said. During this period, the top line growth has been 70 per cent — from Rs 5,527 crore to Rs 9,386 crore. IPCL has been able to make deeper inroads in global petrochemical markets with export earnings in 2004-05 at Rs 1,638 crore.

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