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Punjab Tractors proposes 2:1 bonus

Our Bureau

MUMBAI, June 5

THE board of Punjab Tractors Ltd has recommended a bonus issue of two shares for every one share held. The company ended 1999-2000 with a six per cent increase in net profit at Rs. 133.26 crores as compared to Rs. 125.83 crores the previous year.

The company has also recommended a dividend of Rs. 26 per share.

Total revenue was Rs. 1,178.35 crores as against Rs. 1,087.18 crores. The company earned a cash profit of Rs. 206.39 crores (Rs. 190.51 crores).

Total expenditure for the year was Rs. 974.93 crores (Rs. 903.18 crores). Depreciation stood at Rs. 15.98 crores (Rs. 13.68 crores) and corporate tax at Rs. 57.15 crores (Rs. 51 crores). The company earned a net interest income of Rs. 2.97 crores (Rs. 6. 51 crores).

The company's tractor market share increased to 19 per cent. ``PTL's focus on continuous improvement and capital efficiency plus other inherent strengths helped it improve its margin,'' a company release said.

Demand for tractors tapered off after the first quarter of 1999-2000 on account of the farm economy feeling the full impact of lost production and unremunerative prices of the previous few seasons. This led to a visible lowering of retail demand for trac tors in the Punjab, Madhya Pradesh, Gujarat and Haryana markets and demand flattening in Maharashtra and Bihar.

PTL's Swaraj grew by five per cent in tractor sales to 50,705 units as against the industry growth of 2.2 per cent.

From October 1999, sales improved further with the introduction of a new model -- Swaraj 744 -- in the unrepresented 40-50 HP range, a market size of 50,000 tractors.

Swaraj sales in April were at 3,100 tractors, representing an improved market share of 20 per cent over the previous corresponding period.

Demand for tractors continued to remain weak in the current fiscal, further accentuated by drought conditions in Rajasthan, Gujarat and a loss of crop in Andhra Pradesh.

``On current reckoning, this year would be a challenging one. However, bumper wheat production and meteorological forecast of a good monsoon are signs that augur well for the industry with the consequent impact on demand and offtakes likely after the rai ny season,'' the release said.