Calcutta, Nov. 30: Peerless General Finance and Investment Company (PGFICL), the largest non-banking residuary finance company (RNBC) has turned around and is expected to achieve a positive net-owned fund in the current fiscal. The company has also decided to restrict itself to the financial sector and not to diversify into other areas.
Addressing newspersons on Friday after the company’s annual general meeting, D. N. Ghosh, chairman of the company, said: “The Reserve Bank had given us time till January 8, 2003, to achieve a positive net-owned fund. We have virtually wiped out the massive shortfall in net-owned fund (NoF) which arose in the wake of the Supreme Court judgement in January 1996.”
“We have reached positive net-owned fund situation by October. I cannot disclose what is our NoF now since the accounts are being audited now.”
According to the RBI guideline, a non-banking finance company or an RNBC must maintain an NoF of Rs 25 lakh to carry on with its operations.
The company has also posted a positive surplus of Rs 501 crore during 2001-02 from a negative surplus of Rs 109 crore.
Explaining the gameplan behind this turnaround Ghosh said, “A significant improvement has been brought about in all areas of the company’s operations — in mobilisation of resources, in investment yield, cost and productivity.”
“Annual collections were stagnating at around Rs 350-400 crore. We broke the syndrome. In 2001-02, the company collected about Rs 639 crore. We expect to achieve Rs 1000-crore collection in the current fiscal,” Ghosh said.