Cotton Corporation Posts Rs 28.18-Crore Net Profit

Despite adverse condition caused by fall in cotton production and consumption, the Cotton Corporation of India (CCI) continued its decade-long track record of profit-making by posting after tax profit of Rs 28.18 crore during 1997-98.

Though the pre-tax profit declined when compared with the previous year's Rs 49.12 crore, considering the adversities the performance was better, the corporation chairman M B Lal said at the 28th annual general meeting of CCI yesterday.

He said that irrespective of subdued demand and lowest crop in the last four seasons, the corporation achieved a turnover of Rs 1048 crore. The net worth of the corporation stands at Rs 221 crore as on March 31, 1998 as against Rs 193 crore at the end of March 97.

 

Lal said CCI has started processing contamination-free cotton to the extent of 10 per cent of its total purchases to help quality-conscious mills. The corporation has also undertaken developmental activities to improve the yield of cotton and slash costs. It has earmarked Rs 11 crore for such activities.

Lal said that during 1997-98, the government released 1.08 lakh bales in favour of CCI for export of raw cotton. Despite the prices in the international market being lower or equal to the domestic prices, the corporation succeeded in contracting for 48,000 bales out of the quota of 97-98 season up to March 31,1998.

On account of the worsening condition of institutional mills, CCI increased sales to private sector mills at 4.34 lakh bales during the year. This accounted for 65.04 per cent during 1997-98 as against 56.8 per cent during the previous year. The corporation is also trying to introduce new buyers in the private sector, Lal said. The corporation also provides godown storage facility to mills which takes care of its working capital requirements.

Lal added that CCI sells its cotton on thin margins or at-cost in the domestic market to increase its purchases of raw cotton and thus help cotton growers get a competitive and remunerative price.