Champdany To Seek Approval For Buy-Back

The Champdany Industries Ltd will seek shareholders' approval at the forthcoming annual general meeting (AGM) for buying back its ordinary shares up to a limit not exceeding 25 per cent of the ordinary share capital of the company.

The resolution will be placed at the AGM scheduled for September 8.

Though the company had obtained shareholders' approval for buy-back of shares earlier at an AGM held on August 25, 1995, the validity of the consent has lapsed. Hence, the resolution is being proposed again based on the provisions of the Companies Bill, 1997.

The new resolution, if approved, will be valid for such period as may be decided by the board of directors under the then provisions of law.

 

Meanwhile, the company has taken nearly Rs 32.17 crore as secured loans in the last fiscal compared with Rs 35.29 crore in 1996-97.

While loans from banks stood at Rs 10.49 crore, total term loan from financial institutions (FIs) and banks including the foreign currency loans were at Rs 16.68 crore.

Non-convertible debentures, foreign currency loans, joint venture and term loans under rupee loans are secured by mortgage of the company's immovable properties both present and future, except for some assets.

They are also secured by way of pledge of certain investments held by the company and its associates with Industrial Development Bank of India and Industrial Investment Bank of India in favour of the company's bankers for financing working capital requirements.

The company's joint venture loans are secured by pledge of shares held in Forfar Weavers Ltd of the UK, and mandate/assignment in favour of the lender of receivables and all other accruals arising by virtue of borrower's investment/participation in Forfar Weavers Ltd of the UK.

In case the company defaults in repayment of principal loan instalments and/or interest thereon under certain loan agreements, the FIs have an option to convert such default into fully paid-up equity shares of the company at par in respect of the principal loan amount not exceeding Rs 3.75 crore.

During 1997-98, the company continued its phased modernisation, expansion and diversification programme.

To retain and further strengthen its position in the industry, the management is currently exploring various proposals for innovation and development of value-added diversified products aimed at export market.

According to the corporate review for 1997-98, the future outlook is fraught with unusual uncertainties both internally and externally.

The company, however, is confident of facing and overcoming unexpected disabilities due to its continuous diversification and expansion both in product mix and markets.