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Sunday
Jun 24 2001
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0007 hrs IST
1337 EST
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Jay Shree Tea restructures
Our Bureau
KOLKATA
JAY SHREE Tea & Industries, a Basant Kumar Birla company, is implementing recommendations prescribed by consultants Ernst & Young.
Engaged in the business of tea, chemicals, fertilisers and plywood, the company had requisitioned the services of the consulting firm couple of months ago to improve its operational efficiency and reduce costs. Steps have already been initiated at the company’s estates in Cachar and Upper Assam, and in south India.
The company is also modernising factories and upgrading field practices in its other tea estates, Mr D M Jain, senior president and manager, Jay Shree Tea & Industries Ltd told newspersons after the company’s 55th annual general meeting held in Kolkata on Saturday.
Jay Shree Tea is trying to consolidate its presence in the packet tea segment with the twin objective of reaching closer to the customers as well as enhancing realisation of margins. However, as the wages and cost of other inputs are rising continuously, the profitability of the current year would depend on market conditions and further improvement in working of tea estates and factories.
Despite the profit earned from tea segment, the company incurred losses in 2000-2001 due to heavy losses recorded by its fertiliser and plywood division.
The company’s superphosphate manufacturing unit at Pataudi, Haryana, suffered losses in the wake of poor demand of phosphatic fertilisers and continuous decrease in subsidy.
This apart, illegal stoppage of work recently by a section of contract workers at Khardah, West Bengal, disrupted activities.
Referring to the disruption of work at Khardah in his inaugural speech to the shareholders, chairman B K Birla said: “This will not only add losses to the already unviable unit, but would also deprive the farmers from getting phosphate during peak kharif season. Under the circumstances, the management is examining its option for complete suspension of work or take other actions as may be feasible.” The company has also shelved its plan to set up a factory at Kandla port, Gujarat due to unremunerative plywood prices.
Meanwhile, the company bought back 12.30 lakh shares of Rs 10 each at a price of Rs 120 per share.
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