The Hindu Business Line : STC turnover set to cross Rs 10,000 cr

STATE Trading Corporation (STC) is set to gross a sales turnover of Rs 10,000 crore during the current fiscal buoyed by overall performance in the first half. Last year, its sales turnover was Rs 8,349 crore last year.

The Chairman-cum-Managing Director of STC, Dr Arvind Pandalai, told Business Line that the total turnover exceeded Rs 5,000 crore during the first half, an increase of 54 per cent over Rs 3,254 crore during the same period a year ago.

Import turnover has gone up by 67 per cent to Rs 4,568 crore as against Rs 2,736 crore in the same period last year, while total exports amounted to Rs 303 crore.

However, because of change in the RBI policy on import of precious metals, import of gold took a slight beating and this was made good by "moving into other commodities by lifting a larger volume of coke, coal, metallurgical coke, various raw material for industrial uses and some finished raw material. We are taking a larger volume of raw sugar to take advantage of the current shortages here", he said.

Stating that during the first half STC negotiated better trading margins, he said net profit before tax has zoomed five-fold to Rs 24.4 crore (Rs 4.03 crore).

Dr Pandalai said while the increase in turnover this fiscal might not be large compared to last year, "we are improving our bottomline considerably.

"Last year, there was an increase of our topline from about Rs 2,500 crore to Rs 8,400 crore with a reasonable profit which was about Rs 19 crore; this year we are increasing our topline to Rs 10,000 crore, our bottomline is set to grow from Rs 19 crore to Rs 30 crore plus".

He said STC was committed to enhance profitability and in this direction talking to various companies to have joint venture operations or joint marketing operation such as the one "we have had with the Indian Household Products Ltd. We have similar couple of areas in view and begun exploring".

Due to improved profitability during the first half, the Corporation put before the board meeting its decision to go in for an interim dividend of 15 per cent. Though this was not in the agenda as a special item we have taken it and adopted," he said.

Other decisions that got the board's approval include a joint venture with Metropolitan Development Authority of Mumbai to set up a convention centre which is a trade promotion area. He said the proposed convention-cum-exhibition centre in Mumbai would be "a combination of Pragati Maidan and Vigyan Bhawan" in Delhi.

Another decision pertains to launch a special purpose vehicle for setting up a land customs station jointly with Infrastructure Leasing and Finance Services and MMTC.

Asked to specify new areas into which the Corporation proposes to venture out in view of the bolstered bottomline, the STC chief said: "We are getting into the electronics and communication area. Already, we have participated in the major global companies in the telecom sector and also in one or two tenders in smaller operations. Also, we imported equipment for telecom companies such as RailTel and MTNL".

He said that besides stepping up edible oil operations, STC proposes to get into "some areas where our projects and other things could be utilised".

He said STC would focus its trading activities in the Commonwealth of Independent States, besides reviving activities in Sri Lanka.

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