BIFR issue to figure at BHPV board meet

City-based fabrication giant and a public sector undertaking, Bharat Heavy Plate and Vessels Limited (BHPV), is now mulling over referring its financial status to the Board for Industrial and Financial Reconstruction (BIFR). The matter will be taken up at the BHPV board meeting to be held in New Delhi on January 29.

The board will take decision whether the company's financial position can be referred to BIFR or not.

According to the sources in the organisation, the accumulated loses of BHPV have touched Rs 188 crore, which is more than 50 per cent of the company's equity.

BHPV is already in the government's disinvestment list.

"Once its goes to the BIFR list, it will be much more difficult for us to save the company. That's the reason why we are putting pressure on the state and the central governments to take necessary steps immediately and announce some financial package to revive BHPV," Ganta Srinivasa Rao, a parliament member and honourary president of BHPV Mazdoor Sangh, the recognised union in the BHPV, told Business Standard .

The employees unions are asking the management to put the actual financial position of the company before the workers, before taking up the issue to the board of directors.

During the last financial year, BHPV suffered much for want of orders.

During the entire last fiscal, the company managed to get only around Rs 50 crore worth new orders.

"During this financial year up to December, we gained Rs 190 crore new orders, and nearly Rs 50-60 crores we are hopeful of getting in the coming three months," D N Raju, the chief general manager (production & engineering), told Business Standard .

"Last financial year we gained the customers' satisfaction. Some customers like Indian Oil Corporation, Cochin Refinery and Nuclear Power Corporation have given 'comfort letters' to different banks. With this BHPV has opened LCs with those banks. Following these developments, several customers are coming forward to give new orders to BHPV," he disclosed.

"Now the company's order book position is very satisfactory. If the governments provide counter guarantee for Rs 130 crores, which is being sought by the management for the last one year, to get working capital from banks, the company will execute the existing orders before the schedule time," Srinivasa Rao said.

Along with the north coastal parliament members, the BHPV unions will meet chief minister N Chandrababu Naidu on January 17 in Hyderabad to seek the state government's support. They will also union finance and industry ministers to save BHPV from losses.