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M. Ramesh

Chennai , Feb. 25

SPEL Semiconductor Ltd has arrived at a settlement with the last of its term loan lenders, IFCI. Under a one-time settlement scheme, the company will pay the financial institution Rs 2 crore.

The company has paid Rs 25 lakh and expects to pay the rest by the end of the financial year, "although we have a year's time," Mr Ar Rm Arun, Vice-Chairman, SPEL Semiconductor Ltd, told Business Line.

At a court-convened meeting of shareholders, for getting their approval for conversion of the parent company SPIC's loans into equity, the SPEL Semiconductor Chief Financial Officer, Mr Venkatesh Kumar, said that the company had settled loans of about Rs 15 crore in the last couple of years. "We have brought it down to nil," he said.

He added that the accumulated losses of about Rs 14 crore would come down to about Rs 5 crore in the current year's balance-sheet.

Mr Arun told Business Line that he expected the company to end the year with a turnover of Rs 40 crore, up from Rs 28 crore last year.

With this balance-sheet clean-up, the company is in a position to undertake expansion of its facilities.

The company provides assembly and testing services for integrated circuit manufacturers on job-work basis. According to Mr Arun, there is a good demand for its services from clients abroad. However, the company must expand in order to be able to accept more jobs. An expansion programme is on the anvil, but the investments would depend upon the kind of IC packages the company would focus on.

Mr Arun expects the expansion to take place by the middle of next year. Consequently, sales next year could go up to Rs 60 crore.

At a later stage, SPEL Semiconductor would have overseas equity investors putting in money in the company. While some steps have been taken in this direction, "our focus right now is on expanding facilities."

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