NGEF to divest stake in Mysore Lamps, KTL

BANGALORE, May 29: The state-owned NGEF Ltd is all set to divest its stake in Karnataka Telecom Ltd (KTL) and Mysore Lamp Works Ltd.This wi...

BANGALORE, May 29: The state-owned NGEF Ltd is all set to divest its stake in Karnataka Telecom Ltd (KTL) and Mysore Lamp Works Ltd.

This will enable the company to bring in an amount close to Rs 2.35 crore. At present NGEF has a 74 per cent stake in KTL’s total paid up capital of Rs three crore.

NGEF will also dilute its 28.75 per cent holding in Mysore Lamps shortly. The earlier investment of the company in Mysore Lamps was Rs 13.29 lakh in the total paid up capital of Rs 1.36 crore. The state government has already given green signal to this proposal.

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According to Teresa Bhattacharya, chairman and managing director of NGEF, it had already decided to dilute its shareholding in AEG-NGEF Ltd to garner Rs eight crore. The amount is expected to be realised during the next two months, as AEG-NGEF awaits the approval from the Reserve Bank of India (RBI).

The entire amount would be utilised to pay out the secured loan from various financial institutions and for funding the ongoing voluntary retirement scheme (VRS) as per approved BIFR package. The actual number of employees so far given voluntary retirement is 797 as against the targeted 1806. The VRS is being given in stages and is expected to achieve the target in the near future.

“The overall performance during the year 1996-97 has been better than that of the previous year. The expected loss is around Rs 17.50 crore as against the previous year’s Rs 41.28 crore. This has been possible mainly due to, cutting over-heads, the interest cost and personnel cost by way of one-time settlement to financial institutions and reduction of manpower,” Bhattacharya said.

As on April 1, 1996, the company owed Rs 87.04 crore to financial institutions and other creditors and the same has since been brought down to Rs 61.20 crore on account of repayment during the year, made out of sale proceeds of surplus assets.

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Steps have been taken to reduce working capital requirement by ensuring better inventory norms and reduction of cycle time for production. Higher turnover as projected by BIFR will be possible to achieve on realisation of surplus assets fully.

Substantial production time was lost during 1996-97 due to non-payment by major electricity boards and other customers on time. The quantum of production targeted for the first quarter of 1997-98 has been Rs 35 crore as against actual achieved of Rs 26 crore in the first quarter of 1996-97. Recently NGEF has bagged an order worth Rs 11 crore from Delhi Vidyut Board (DVB) to supply transformers.