Damage due to violence estimated at Rs 150 cr: Regency Ceramics

The damage caused by the recent violence at tiles-maker Regency Ceramics facility at Yanam, near Puducherry, has been pegged at Rs 150 crore in initial estimates and the management is yet to take a decision on reviving the beleaguered company, a top official has said.

A decision with regard to the revival will be taken in the next 10 days, as most of the employees are still in a traumatic condition after the incident, Regency Ceramics Chairman and Managing Director G N Naidu said in a press conference.

"We are totally blank and we have not decided on what would be the future of Regency. Our first priority will be setting right some of the educational institutions run by us," he said.

"The initial estimates carried out by the insurance companies suggested the loss to be approximately Rs 150 crore. Final estimation is yet to be done and after that only we will make a claim," he added.

The facility, which was damaged in a recent attack by workers, has an insurance coverage of Rs 450-500 crore, Naidu said.

The labour unrest at the company's facility turned violent three days ago, with workers going berserk following the death of their leader and allegedly attacking a senior executive of Regency, who succumbed to his injuries.

Shares of the company fell to the lower circuit on the BSE today, down nearly 5 per cent vis-a-vis their previous close, at Rs 3.81 apiece.

Satyandra Prasad Narala, the Executive Director of Regency, said the company is weighing three options — reviving the units slowly, relocation of the plant and a complete sell-off.

He, however, said the company is inclined toward reviving the plant on its own.

The company suffered a net loss of Rs 7.30 crore in the third quarter ended December 31, 2011, on revenues of Rs 49.5 crore.

The company has been suffering losses for the past few quarters on account of production losses due to non-availability of gas. The company has total debt of Rs 80 crore in term loans and Rs 35 crore working capital.

The accumulated losses of the company will be approximately Rs 35 crore, the official said.

"Had this incident not happened, we would have broke even in the fourth quarter of this fiscal," Narala said.

Regency's facility had a total capacity for producing 40,000 square metres of tiles per day.