M & M & #39;S 2000-01 Investments Cut By Rs 113 Cr

Automobiles major Mahindra & Mahindra's (M&M) total investments during the fiscal 2000-01 were reduced by Rs 113 crore to Rs 709.99 crore from Rs 822.99 crore in 1999-00.

Of this, the company's current (short-term) investments were slashed by 59 per cent during the year to Rs 95.54 crore from Rs 234.34 crore in the previous fiscal, according to its latest annual report.

On the other hand, M&M's long-term investments have increased by Rs 25.80 crore from Rs 588.64 crore in 1999-00 to Rs 614.45 crore in 2000-01.

Among the major changes in its investment portfolio, the company sold Union government securities with a face value of Rs 195.15 crore in the year (Rs 421 crore in the last fiscal). It also purchased securities with face value of Rs 65 crore (Rs 442.15 crore), thus resulting in a net sales of Rs 134.53 crore. The company also sold its entire investments in the commercial paper of Indian Petrochemicals (IPCL) and L&T worth Rs 22.63 crore.

M&M's investments in fully paid-up debentures and bonds in its subsidiary and other companies (unquoted), increased from Rs 5 crore to Rs 34.87 crore during the year.

Further, the market value of the company's quoted investments declined by 71.5 per cent during the fiscal to Rs 64.66 crore from Rs 227.25 crore in the previous year.

The company's decision to sell some of its current investments may have been prompted by a sharp reduction in its cash flows. Its closing balance of cash and cash equivalents for the previous fiscal stood at Rs 142.23 crore, against Rs 261.19 crore during 1999-00 and Rs 306.55 crore during 1998-99.