The Hindu Business Line : MMTC sets Rs 20,000-cr turnover target

MMTC Ltd has set a turnover target of Rs 20,000 crore for the current fiscal, with more focus on export and domestic trade, on the back of Rs 16,385-crore turnover itachieved during 2005-06.

Disclosing this to Business Line here in an interview, the Chairman-cum-Managing Director, MMTC Ltd, Mr S.D. Kapoor, said in 2005-06 "we have done well in terms of business volume but profit margins were under pressure because trading was very tough and competition intense." He said the overall profit was same as that of the previous year with a rider that "We have to provide for Rs 12.65 crore towards customs duty dispute as a prudent accounting policy. If the dispute is settled in our favour, it gets added to our profit."

Activities, which contributed the maximum to the company's business, include gold, precious metals and jewellery, metals, coal and hydrocarbon products and fertilisers. The company posted a trading profit of Rs 211 crore with net profit before tax of Rs 135 crore. The net profit after tax amounted to Rs 94.25 crore.

Coal mining, washing

Stating that the company could afford to be selective in choosing its lines of activities now, Mr Kapoor said one area in which it was going to involve itself a little more this year was coal mining and coal washing. "We are going to get a block allotted. Today we are importing coal and if we can produce coal or improve the poor quality coal, then it will be import substitution. As energy becomes more critical, there is a possibility of making business out of coal."

Wind energy

MMTC is also into non-conventional energy - setting up wind energy farms, Mr Kapoor said adding that "we have already set the ball in motion and our first wind farm should be in position before September 2006."

He said the company hoped to tie up with power plants coming up in Gujarat, Haryana and Orissa for supplying coal.

MMTC has also ventured into setting up free trade and warehousing zones. It plans to set up warehouses in Kandla and Haldia.

Customs stations

MMTC is also examining the possibility of engaging itself in land customs stations at border areas. He said "We are looking at Land Customs Stations to become trade facilitator and thereby get into trade activity per se."The company is acquiring rail wagons under the Own Your Wagon scheme, and the first rake is to be delivered this month.

The company was also making a foray into cold chain management not only to add value to the business but also to provide facilities for growers of perishable produce, he added.

Iron ore exports

On export of iron ore, he said, the company was allotted less quantity last year under the long-term contract than what it was exporting. "We will have to make up for the shortfall by roping in more business activity either by adding product mix or enlarging the market mix". He said the prices of most of the commodities the company was trading were now looking up. Gold price is at a 30-year high; metals such as copper, alumina, zinc and nickel are firming up. He said in view of the better price prospects for the metals and minerals that the company was trading, MMTC is making strategic investments in various trade-related infrastructure with a view to providing a fillip to its extant and proposed lines of activities.

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