Back in black 3 years ago, Bengal Chemicals eyes spot among top 100 PSUs

After turning around three years ago, state-owned Bengal Chemicals and Pharmaceuticals Ltd is vying with 400 other public sector undertakings to grab a apot in the country’s list of top 100 PSUs. The company is expected to finish as the topper under the health, Ayush and pharmaceutical ministries taken together.

“Our performance in the last fiscal year may make us stand in the first position in earning profits under the health, Ayush and pharmaceutical ministries and we will enter the list of the top 100 PSUs in the country based on our financials.” the company’s managing director P M Chandraiah said.

After posting a total income of Rs 120 crore with a net profit of Rs 25 crore the last fiscal, it is now eyeing a top line of Rs 500 crore and a net profit of Rs 150 crore by 2025. It also hopes to become a Miniratna company by 2022, after its negative net worth of Rs 67 crore turns positive.

Founded in 1901 by Acharya Prafulla Chandra Ray, Bengal Chemicals is one of the few champions of the Swadeshi movement and one of the oldest surviving Swadeshi companies in India. After continuous years of profit, the company fell into bad times in 1967 and had posted losses continuously for 50 years. It was only in 2016-17 that Bengal Chemicals turned around by posting a full-year of net profit of Rs 4.51 crore and a total income of Rs 110 crore. Since then, its financial health has been continuously improving.

“For the past five years, we have been growing at a 27 per cent CAGR and if we are able to maintain a CAGR of 20-25 per cent for the next few years, we can easily achieve sales of Rs 500 crore,” Chandraiah said.

According to him, the contribution from sales of home products, such as phenol, disinfectants, floor & toilet cleaners will improve from the current level of Rs 30 crore to Rs 100 crore, while the earning of Rs 65 crore from generic drugs will scale up to touch over Rs 400 crore.

“We are increasing our presence in e-commerce platforms and have already tied up with Big Basket and other negotiations are underway. In another 3-4 months, those deals will be finalised,” the official said.

It is also in talks with modern retailers like Spencer’s and Big Bazaar to sell its products from these chains.

Although Bengal Chemicals started posting profits in 2016-17, its accumulated losses currently stand at Rs 221 crore and Chandraiah expects they will be completely wiped out in the next four years.

However, the company has a liability of Rs 200 crore payable to the central government against a Rs 115 crore loan, and has sought a waiver of the interest component of Rs 85 crore from the total liability.