| HMT (Machine Tools), HMT (Watches), Braithwaite, Andrew Yule may be back in black.
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| Riding on the back of strong manufacturing growth, seven chronic loss-making central public sector units are expected to witness a turnaround this year. If they do turn around, the majority of PSUs under the department of heavy industry will report profits.
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| The department’s upbeat forecast about the seven PSUs has come along with similar independent reports about PSUs in general.
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| The National Council of Applied Economic Research’s Business Expectations Survey-April 2006 showed public sector firms were among the most upbeat about the future.
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| Little wonder that some of the chronic loss-making PSUs expected to turn around this year included long-standing names in manufacturing such as HMT (Machine Tools) and Braithwaite & Company.
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| The others that are expected to stage a turnaround are Andrew Yule & Company, Praga Tools, Heavy Engineering Corporation, HMT (Watches) and HMT (Chinar Watch).
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| The wave, riding on which these companies are expected to turn around emerged last year. The manufacturing sector grew by 9.4 per cent in 2005-06, faster than the overall industrial growth rate of 9 per cent.
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| A spin-off of the industrial buoyancy is that the government is inclined to pump in fresh funds to revive some of the loss-making PSUs. For instance, the boom in the capital goods sector has led to the heavy industry ministry recommending to the Cabinet a Rs 700-crore revival package for HMT (Machine Tools).
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| A turnaround will mean huge savings for the government. Of the 34 operational PSUs under the department of heavy industry, 21 are expected to have made a loss in 2005-06. Their combined loss in the year is likely to be Rs 1,952 crore. The seven PSUs expected to turn around are together expected to register a loss of over Rs 45 crore. |
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