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Sidharth Birla, new president of the Federation of Indian Chambers of Commerce and Industry, is trying to revive two of his earlier flagship companies, Xpro India and Digjam.
Xpro India is set to commission a plant in Bengal early next month. This is expected to produce polymer films of a certain thickness, an import substitute and utilised in electronic and electrical devices. Digjam, once in a pole position in the home market, is coming up with premium products. At present, half its revenue comes from export, primarily to the US and Europe, recovering from recession.
Digjam made a net profit of 4.5 crore on a turnover of 136 crore in 2012-13. Xpro India made a loss of Rs 4.1 crore on turnover of Rs 225 crore.
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- Over-the-top expansion had caused damage to Digjam and resulted in a debt of around Rs 400 crore
- S K Birla says he had to sell OCM, which was part of Digjam, to overcome the huge debt
- Digjam has upped its ante into premuim segment recently and Europe and US recovering from recession is good sign
- Xpro India is set to commission new unit in Bengal which saw an investment of Rs 200 crore
- Coex division of Xpro India hopeful of revival as white goods industry may clock growth next year
- Cimmco Ltd is hoping for better flow of orders for the wagon industry
“We are getting back to growth. Digjam's heavy expansion cost us and we were left with a huge amount of debt, around Rs 400 crore. We had to sell OCM. Now, we are almost debt- free and if things go in line with our plans, we shall get back to the pole position,” said Sudarshan K Birla, chairman emeritus (and Sidharth’s father).
According to C Bhaskar , managing director and chief executive officer of Digjam, the debt is now a meagre Rs 4-5 crore.
“Exports are seeing good growth as recession in global markets is erasing. Our focus will remain the domestic market. We are penetrating into non-woollen states. The brand equity is getting a boost in our existing locations,” he said. They were, he said, aggressively increasing the number of locations where their products would be available.
Bhaskar is also MD and CEO at Xpro India. Its second division, catering to white goods companies, was hit due to a downtrend in that industry. “The Coex division did not do well because of degrowth in the industry. Hopefully, there will be better growth next year, boosting our performance as well,” he said.
Birla still has a small stake in Cimmco Ltd. The wagon manufacturing company was acquired by Titagarh Wagons.
“We came in as a co-promoter as the company had excellent infrastructure, along with a great set of people,” said the current vice-chairman and managing director, Umesh Chowdhary.
He said 2013 was the worst year for the company. “I hope things would be better next year,” he added.
