Rajasthan Spinning eyes FY10 topline at Rs 1,500cr

In an interview with CNBC-TV18, JC Laddha, Executive Director of Rajasthan Spinning and Weaving Mills, spoke about the company’s future plans.

Here is a verbatim transcript of an exclusive interview with JC Laddha on CNBC-TV18. Also watch the accompanying video.

Q: There was a block deal in which Rajasthan Spinning’s stake of 15 lakh shares in Maral Overseas was sold along with it we also had HEG selling its stake in Maral Overseas. These shares were purchased by Agarwal Finestate and Essay Marketing. Is it basically an inter-se group change of hands?

A: I am not much aware about it. It might be the arrangement between the promoters. I am looking after the operations and the business of the company.

Q: You would have no idea on what this stake sale was regarding because you all have been long-term investors in Maral Overseas since the beginning since it was about Rs 10. Is this anything significant, this strategic exit in this and what was your relationship with Maral Overseas? Was it just an investment holding?

A: It was a group company but I am not aware about this block deal. I am looking after the operations of the company.

Q: How is business because it has seen nice turnaround for the last four-five quarters? I am looking at a September 2008 loss of Rs 23 crore then in March 2009 there was Rs 84 lakh profit. Your recent numbers have been Rs 8.6 crore. Take us through the entire textile business because we have got possible and very positive rumblings for the next two-three months from other operators. What sort of a topline are you working with by year end and bottomline and how is the business environment in general?

A: Last year, 2008-2009 was one of the worst years for the company because of the global meltdown and violent fluctuation in the forex. This year, 2009-2010 is upward looking and you must have seen the result of the past six months certainly there is a turnaround. For 2009-2010 we are looking for a topline of about Rs 1,500 crore and profit before tax (PBT) of about Rs 95-100 crore.

Q: Would it be at the net level?

A: At the net level it will be around Rs 25 crore.

Q: That’s fairly steep fall in margins that you are looking at, Rs 25 crore of profit on Rs 1,500 crore revenues. Do you see things improving in FY11?

A: Yes certainly. 2010-2011 will be better than 2009-2010. 2009-2010 is a year of stabilisation and slight recovery over the period of 2008-2009. For 2010-2011, I am definitely looking for better results and bright future for the company and textile industry as a whole.