The Mumbai-based Amforge Industries, manufacturer of forging, wheels and connecting rods, will be reported to the Board for Industrial and Financial Reconstruction (BIFR) under Section 23 of the Sick Industrial Companies (Special Provision) Act.
The accumulated losses of the company during the immediately preceding four financial years have resulted in the erosion of 50 per cent of its peak net worth.
The company in a notice issued to its shareholders for an extra-ordinary general meeting, said, "Due to a slowdown in the economy in general, and in the automobile industry in particular, the turnover of the company has been shrinking compared to industry estimate during the last several years."
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During 1997-98 to 1999-00, the company's turnover showed an increasing trend, though the company suffered losses.
However, during 2000-2001, the gross revenue came down to Rs 174.29 crore against Rs 209.44 crore and the net loss of the company increased to Rs 22.50 crore compared with Rs 4.56 crore in the previous year.
The installed capacity of the company is: forgings 57,500 tonnes, 3 lakh wheels and 2.4 lakh conrods per annum. The company's forging facilities are located at Khopoli, Chinchwad and Chakan in Maharashtra and wheels and connecting rods division in Faridabad.
The company is planning to prune its workforce and sharpen its focus on value-added products as a part of its bailout strategy. The company has also adopted a new technology to save energy, wherein compressed natural gas is being used for heating instead of furnace oil. Rationalisation of product mix is being implemented by transferring of jobs to energy efficient units. Besides, redesigning and modification of existing equipment are in progress.