Financial Daily from THE HINDU group of publications
Thursday, Jan 03, 2002
Price, demand fall pulls down KMML profit
KOCHI, Jan. 2
DROP in demand and a consequent price fall had pushed down both the turnover and profits of Kerala Minerals and Metals Ltd (KMML) at Chavara in Kollam district, during April -December 2001.
During the first nine months of the current fiscal, the sales turnover stood at Rs 202.33 crore as against Rs 213.25 crore in the same period last financial year. This was reflected in the profits that fell by Rs 10.52 crore to Rs 70.15 crore (Rs 80.67 crore)
Attributing the decline in sales and the profits to the 30-35 per cent drop in the prices of titanium dioxide pigment and the slump in demand, Mr N.R. Subramanian, Managing Director, KMML, told Business Line on Wednesday that the company had taken various cost cutting measures to keep the prices competitive. And yet, some of the paint companies were using imported titanium dioxide.
The company had increased production from 18,454.96 tonnes in April-December 2000 to 19,803.22 tonnes during the same period in the current fiscal. The sales also picked up to 18,910.46 tonnes from 18,099.63 tonnes , whereas, the price had fallen to around Rs 95,000 per tonne from Rs 1,28,000. This had affected adversely the turnover and profits.
In fact, the company had achieved an all-time record in the production of the raw material, ilmenite, in December. The output was 2,525 tonnes, an increase of 300 per cent.
It was for the first time since the mineral separating plant was commissioned in 1984 that the production had touched such a high level.
The highest-ever production in the past was 2,260 tonnes a month in 1984. Thereafter, it continued to decline. This had reduced the company's dependence on the raw material from other sources such as the IRE, besides making a saving in cost, he said.
The capacity utilisation of the titanium dioxide pigment plant had also gone up to 149 per cent, he said.
However, the slump in the market had resulted in the piling up of the stock estimated at around 4,000 tonnes.
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