The Hindu Business Line : JIK Ind to focus on crystal ware

A series of events necessitated this approach, prompting the company to completely exit from the money changing business and chemical waste recycling.

JIK, which is working out a corporate debt restructuring (CDR) package with its lenders, recently concluded a deal with its unsecured creditors, converting debt to equity under Section 391 of the Companies Act.

"About Rs 30 crore of debt was converted into equity. We received overwhelming support from our fixed deposit and non-convertible debenture holders and other unsecured creditors," Mr R.G. Parikh, Chairman, JIK Industries, said. The paid-up capital base has increased to Rs 14 crore from Rs 4 crore as a result of this.

Accidents: JIK hit an `unfortunate' phase in 2004 when an accident at its chemical waste recycling plant forced the company to cease operations. Soon thereafter, another accident at its crystal unit pushed the company into losses. Its net worth was eroded in the process, forcing the company to get out of the money changing business as mandated by the Reserve Bank of India's stipulations.

"Having come out of difficult times, crystal is going to be our focus," said Mr Aditya R. Parikh, Vice-President - Finance, JIK Industries Ltd. The CDR package is expected to be approved shortly.

The company, which is into lead-free crystal, makes stemware, tumblers and decorative pieces.

Hotels, export main markets: At present, JIK is an institutional player catering to hotels and companies, with a small retail presence. "Many of the hotels have switched to buying from us as imported crystal is much more expensive," Mr Parikh said.

"There is also a huge export market and India has a major advantage, both in terms of skill in hand-made crystal ware and cost," Mr Aditya Parikh said. Margins are also slightly higher in exports.

Crystal ware has a strong market, particularly in Europe where many of the hand-made crystal units are closing down due to cost overruns.

Over the last one month, JIK Industries' share price has been hovering between Rs 2 and Rs 2.92 per share on the BSE.