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NEW DELHI: Polyester-manufacturer Indo Rama Synthetics Ltd (IRSL) on Friday reported a 78.39 per cent dip in net profit at Rs 4.63 crore (Rs 21.43 crore) for the third quarter ended December 31, 2005.

The gross sales dipped 16.5 per cent to Rs 446.18 crore (Rs 534.35 crore).

"During the quarter, high raw material and furnace oil prices affected margins for all polyester manufacturers. The industry, in an attempt to encourage downstream sectors, did not pass on the full measure of this cost increase," the IRSL Chairman and Managing Director, Mr O.P. Lohia, said.

The polyester industry had now started showing signs of picking up from January 2006 with downstream demand improving for both fibres and yarns, he said.

The company's net profit during April-December 2005-06 declined 10.6 per cent to Rs 48.33 crore (Rs 54.10 crore). Gross sales were Rs 1,537.93 crore (Rs 1,574.26 crore).

Mr Lohia said the company would not suffer cost escalation in its plans for doubling polyester capacity from three lakh tonnes to six lakh tonnes at an investment of Rs 856 crore. The machinery is currently under installation, he said, adding the new capacity is likely to be commissioned in a phased manner from June.

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