Vesuvius India Net Profit At Rs 5.12 Cr

Vesuvius India (VIL), manufacturer of refractories, posted a net profit of Rs 5.12 crore on a gross profit of Rs 55.99 crore for the year ended March 31. The company will pursue the extention of its product range complementary to the main business and will start manufacturing slide gate plates and nozzles from early next year, VIL chairman, Jahar Sengputa, said at the company's fifth annual general meeting here yesterday.

We will return to dividends from next year and hope to notch up sales of Rs 15 crore from the new products alone, Sengupta said. The construction of the extention block is currently underway and we hope to begin trial run from December, said B Gupta, managing director, Vesuvius India. The slide gate equipment manufacturing unit is being set up at a cost of Rs 3.5 crore. Slide gate equipment is a specialised kind of refractory used for controlling the flow of steel.

VIL is a subsidiary of the Vesuvius Group, which in turn, is part of the $3.15 billion UK-based Cookson Group. The group has a global share of 70 per cent in continuous casting refractories(CCR).

The Vesuvius Group has nearly 55 per cent stake in VIL. All major financial activities are looked after by the Cookson Group. The Vesuvius Group fully supports its subsidiary in India and the unit forms an important part of VGL's worldwide operations, said VIL director Jean Pierre Malherbe. VIL, the only Fera company in the refractories industry, is set to reduce its import content per tonne of finished products.

VIL, which recently commissioned its fourth mixing plant (10,000 tpa), is eyeing the possibility of exporting slurry to some of the Asian countries where the company has subsidiaries.

Currently the steel industry alone accounts for 75 per cent of refractories offtake.

Nearly 75 per cent of the world's steel production is through the CCR process which involves a heavy capital outlay but cuts production cost between 15-20 per cent by saving on energy.

In India, only around 28 per cent of the steel is produced by the concast technology. But as new steel units are resorting to this technology, CCR manufacturers are set for a robust growth.

As part of its CCR capacity expansion, VIL commissioned a Rs 6.3 crore mixing plant (6000 tpa) and a second kiln at a cost of Rs 2.2 crore early this year. The company has also paid off Rs 12 crore high cost debts. Funds for these projects were raised throught a rights issue in December '96 aggregating Rs 23.2 crore. Besides, Rs 10 crore was provided by the parent company which was adjusted against its contribution to the rights issue.