Atlas Cycles to shut down Madhya Pradesh factory

After years of losses incurred from its Malanpur factory in Madhya Pradesh, Atlas Cycles has decided to shut down the unit and has already suspended manufacturing activity there, the company said Thursday.

"After consideration of the above matter and detailed deliberations, the board of directors of the company has resolved to close the Malanpur unit and has also suspended the manufacturing activity of the said unit," the company informed the National Stock Exchange (NSE).

"Suitable steps for earliest closure of the said unit (at Malanpur) are being taken," it said.

Post the closure of the Malanpur unit, the company will be left with two other operational units at Sonepat in Haryana and Sahibabad in Uttar Pradesh.

"Malanpur unit hasn't been able to increase its production to a break-even point and the said unit continues to incur losses. The measures for revival of the unit has unfortunately not come through so far," the company said.

The territories which are presently covered by the Malanpur factory will be served by the other two remaining units.

Shares for the company traded at Rs. 233.55 up by 6.25 percent on NSE at 2.30 p.m.

For the quarter ending June 2014, standalone sales accounted for Rs.147.08 crore, down 7.14 percent compared to last quarter. Net loss stood at Rs.8 lakh.