Booming food business, a boost to Tinplate's export .

Kolkata, May 7 A booming food business across the world is to boost The Tinplate Company of India Ltd's export business, according the company's managing director, Mr Tarun Daga.

“The company will continue its strategic thrust of maintaining 25 to 30 per cent of its business as exports to specific end-users in South-East Asia, West Asia, Europe and neighbouring countries,” Mr Daga told newspersons here on Friday.

“We produce raw materials for tin containers used widely for food packaging but we do not sell directly to those in food business,” he said adding, “we sell to fabricators who in turn sell the containers to those in food business. More than two-third of tinplate consumption all over the world is in food related packaging.”In 2009-10, the company's exports amounted to Rs 300 crore. The figure was expected to rise in coming years and the growth was being witnessed in the developing nations, not so much in developed countries, he observed.

Expansion

On completion of the ongoing expansion programme in the course of the current fiscal, Mr Daga pointed out, the capacity would rise to 3,79,000 tonnes annually from the earlier 1,78,000 tonnes. The first phase work was completed in October 2008.

The total investment was estimated at Rs 625 crore of which around Rs 200 crore had already been spent.

The funding was partly by way of rights issue (Rs 374 crore) completed in September-October last year and the balance through loan. Following the issue, the Tata Steel's stake in the company increased from 32 per cent to 45 per cent.

Posting profit

The Tinplate Company India Ltd, which is completing 90 years this year (2010), for the first time achieved the profit before tax in excess of Rs 100 crore. In 2009-10, PBT amounted to Rs 101.53 crore (Rs 62.67 crore) and profit after tax Rs 67.15 crore (Rs 34.8 crore) on a turnover of Rs 793.15 crore (Rs 661.91 crore).

The board recommended a higher dividend of Rs 1.5 per share (15 per cent) as compared to Rs 1.25 per hare (12.5 per cent) in the previous year.

The fourth quarter profit however was lower at Rs 7.40 crore (Rs 21.88 crore). Mr Daga attributed it to lower realisation compared to high input costs vis-à-vis the same period of last year.

Source : Business Line