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Our Bureau

Kolkata , June 28

EVEREADY Industries India Ltd, the flagship company of the BM Khaitan Group, has put its earlier plan of entering the Chinese battery manufacturing sector on the backburner.

Talking to reporters after attending the 70th annual general meeting of the company, Mr Deepak Khaitan, Vice-Chairman and Managing Director, said the China plans had been delayed.

"We feel that we should have a footprint in China in the medium-term but for the time being we are not going to manufacture batteries over there. An Eveready battery factory in China is ruled out," he said.

However, Eveready would start buying some of its raw materials, like electro-magnetic diodes, metal and plastic parts, from China by the end of the fourth quarter of 2005-06. Currently, the company is buying these materials partly from India and the rest is imported.

Earlier, addressing shareholders, Mr Khaitan said the board of directors would contemplate giving an interim dividend on the completion of the six-month period. For 2004-05, Eveready did not declare any dividend as it had undergone a demerger exercise.

"The first three months of this financial year would be over soon. We have continued to register comfortable growth. Let six months be over, then I will ask the board to consider an interim dividend," he said.

Meanwhile, the company would be increasing the price of its batteries from July 1, by five per cent. According to Mr Khaitan, a huge increase in the global zinc prices has forced Eveready to take this decision.

"Every player in the industry is increasing the prices. To start with, we are hiking the price of the D size batteries by five per cent only. The move would help us improve both the topline and the bottomline of the company," he said.

Eveready has also started negotiating with Toshiba for supplying batteries for the Japanese market. At present, Toshiba buys 25 million batteries every year from Eveready and supplies it mostly to the Latin American markets.

"We are negotiating with the Japanese company to double our sales. We also want to make batteries for them for the Japanese market," he said.

Earlier, shareholders questioned the company's move to add the valuation of the Eveready brand under the reserves and surplus head. The valuation of Rs 660 crore was done by Ernst & Young.

According to Mr Khaitan, the Eveready brand is the biggest asset of the company. The brand charges a seven per cent premium on all categories of batteries, against its competitors in the domestic market.

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