GWALIOR STRIPS LTD.
OBJECTS & ACTIVITES: Manufacture of cold rolled steel strips with a minimum
thicknesss of 0.5 mm and a width range of 200 mm to 350 mm
INCORPORATION & PROMOTION: The Company was incorporated on 22nd February
1984 and obtained the certificate for Commencement of Business of 3rd March
1984 It was promoted by P.L Joseph, Vinod Gupta and T.c Jain.
PROJECT: The Company undertook to set up a plant fo rthe manufacture of
10,000 tonnes of cold rolled strips per annum. Land admeasuring 8.662
acres was acquired at village malanpur in Bhind district of Madhya Pradesh,
a no industry area, After the installation of Plant, trial runs were
conducted. The plant was formally inaqurated on 28the july 1985.
OPERATIONS: During 1986-87 the Company achieved a sales turnover of Rs 6.41
crores as against Rs 2.77 crores in the previous period of 9 months.
During 19877-88 sales amounted to Rs 9.19 crores During 1988-89 sales
increased substantially to Rs 15.68 crores representing an increase of 70%
when compared to the previous year. Despite increased sales profitability
was low due to increase in raw material prices without proportionate
increase in the prices of finished products. The installation of the
second mill was completed. Commercial production commenced in March 1989,
Plans were in hand to install balancing equipment, such as annealing
furnace, etc During 1989-90 sales declined to Rs 12.40 crores Inspite of
highly competitive environment the order book position was satisfactory.
However the demand in the market could not be met fully due to frequent
interuptions in power supply and low receipt of raw materials from the
suppliers During 1990-91 sales further declined to Rs 7.14 crores. The
overall working continued to incur losses due to constraints such as
continous voltage fluctuation, paucity of funds and consequent raw material
shortage. During 1991-92 turnover again dropped to Rs 5.47 crores The
company continued to incur losses due t paucity of funds and erratic
supploy of raw material. The Company produced 2,908 tonnes of C.R Steel
strips during theyear as against 4.224 tonnes in 1990-91 In addition 786
tonnes of job processing was carried out as against 784 tonnes in 1990-91
During 1992-93 turnover once again dropped to Rs 2.60 crores due to
shortage of working capital funds and disruption in the flow of job work
orders owing ot disturbed condition in the country.
FINANCE: The following term loans were sanctioned Rs 90 lakhs from Madhya
Pradesh Audyogic Vikas Nigam ltd Rs 30 lakhs from Madhya Pradesh Financial
corporation, Rs 35 lakhs from State Bank of India and Rs 20 lakhs from
State Bank of Indore.
MERGER/AMALGAMATION PROPOSAL: During 1988-89 a proposal for
merger/amalgamantion of Spring Steel ltd with the Company was being worked
out. The M.P High Court Gwalior bench had ordered the covenning of an
extra ordinary General Meeting on 21st September 1991 to consider and
approve the Amalgamation of both the companies. The Company proposed to
issue 4,00,000 equity shares to the erstwhile shareholders of Spring steel
ltd in the proportion 1:1
GENERAL: 5,850 equity shares of the Company were forfeited on 17the August 1985. The forfeited shares were reissued to the employees of the company
on equitable basis.
The Company obtained the consent of the Controller of Capital Issue to
issue 16,000 equity shares of Rs 10 each at par to its employeees/workers
on an equitable basis. The unsubscribed portion , if any would be allowed