Elgi Tyre To Be Renamed As Elgitread (India)
Retreading equipment major Elgi Tyre & Tread Ltd has proposed to change the name of the company to Elgitread (India) Ltd.
The move is to reflect its new areas of activities in the country and abroad.
Elgi Tyre has also decided to increase paid-up capital of the company by issuing bonus shares capitalising a sum of Rs 1.42 crore from the general reserve.
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This amount is proposed to be paid up at par 14,25,000 new equity shares of Rs 10 each to be allotted as bonus shares to the shareholders in the proportion of one new equity share for every two existing equity shares held.
The company has decided to invest Rs 1 crore in the share capital of Elgi Rubber Products Ltd in another move to use its surplus funds for investment. It has also decided to buy Rs 1 crore worth shares of Rayalaseema Technologies Ltd.
Elgi Rubber is in the business of manufacturing reclaim rubber and crum rubber.
The company plans to seek shareholders approval for these moves at its annual general meeting to be held at Hindupur in Andhra on August 28.
Among others, Elgi plans to dispose off its assets located at Annur in Coimbatore near its factory. The move is proposed to enable it focus on its core business -- manufacture of major retreading inputs and franchising of the retreading system.
The company, which has subsidiary companies like Elgitread Ltd (Mauritius) and Elgitread Ltd (Tanzania), saw its performance increase by a mere one per cent in quantitative terms and two per cent in value during 1997-98. Elgi attributed this to 'recessionary conditions' in the transport industry and tight money supply.
The company has posted a gross income of Rs 146.1 crore during 1997-98 as against Rs 143.1 crore realised in previous year. Its net profit was Rs 18.3 crore as compared with Rs 16.2 crore in the last fiscal year.
According to it, in the franchising segment, the increase in the quantity of material sold was six per cent, while there was a decrease of four per cent in the sales made to the state transport undertakings.
To boost revenues, the company plans to address the cost-conscious market in which small scale operators dominate.
It also plans to strengthen its brand equity both in the country and abroad.