At a time when most of the public sector undertakings are mired in the red, Rashtriya Chemicals & Fertilizers'(RCF) net profit for the year ended March 31, 1998 is set to zoom 134.13 per cent to Rs 180 crore from Rs 76.88 crore in 1997.
The company is set to register a 30.87 per cent increase in turnover to Rs 1,750 crore from previous year's Rs 1337.20 crore and the gross profit is poised to touch Rs 250 crore from the previous year's Rs 1,57.27 crore. "We are targeting a turnover of Rs 2000 crore for the current fiscal," S Balan, director (finance), RCF, told Business Standard.
RCF is currently negotiating with UCB Belgium Co to enter into a joint venture project (50 per cent export oriented unit) to manufacture methylamines at its facilities in Trombay and Thal. Methylamine is a high-value product used in agro-fertilizers.
"We are currently awaiting the final clearance of the board following which a feasibility report will be prepared," Balan said.
After surveying the Thal unit, UCB has agreed to transfer the latest high-end technology to RCF in return for a stake in the joint venture project. "The longterm plan is to float the joint venture project into a separate company," Balan said.
RCF has two major facilities, one at Trombay where it manufactures ammonia and urea and the other at Thal which produces fertilizers and complex industrial chemicals. RCF is also awaiting government clearance to expand Thal's urea capacity by another 7.5 lakh tonnes per annum from the current 15 lakh tpa during the current year. RCF's Trombay unit currently has a 3.5 lakh tpa urea capacity. "Our plan is to double our capacity to 5 million tpa over the next five years," Balan said.
RCF, which is currently on a drive to expand its trading activities, will import between two to three lakh tonnes of di-ammonium phosphate during the current year.
RCF has also been shortlisted by the government to handle the distribution of fertilizers from JNPT, Vizag and New Mangalore ports.
RCF, with a 5,700-strong workforce, has a current equity base of Rs 551 crore and the company's net worth is Rs 1,100 crore with reserves at Rs 450 crore.
Oman India JV project work to be on by Jan'99
Oman India Fertilizer Co LLC (Omifco) has selected Banque Nationale de Paris, J P Morgan and Arab Bank Corp of Middle East as consortium bankers for its $1.1 billion fertilizer project at Sur in Oman. The financial closure is likely by November and the project work will be taken up by January 1999.
The project cost of $850 million will be financed through debt while $250 million will come through equity. Rashtriya Chemicals and Fertilizer Ltd (RCF) and Kribhco, with 25 per cent holding each, will chip in $62.5 million (Rs 250 crore). Oman Oil Company will hold the rest of the equity in the project which will come up at Sur in Oman. RCF is likely to enter into syndicated loan arrangement with ICICI and Bank of India. The project is expected to go onstream by 2002 and produce 1.5 million tonnes of urea and also ammonia.
