New Delhi, Nov. 26 (PTI): The Bajaj family and other promoters of Bajaj Electricals have consolidated their stake in the company, crossing the majority 51-per cent mark after a rights issue that closed on October 31.
On November 1, the promoters held 65 per cent, up from about 49 per cent before the issue, said Shekhar Bajaj, chairman and managing director of the company.
“We had announced a Rs 10.8-crore rights issue to infuse fresh funds in operations with the understanding that any unsubscribed portion be taken up by the promoters themselves. After the issue, promoter holding in Bajaj Electricals has gone up to 65 per cent,” he added.
On the company’s financial health, Bajaj said he hoped it would turn around with an operating profit in 2003-04, after two years of losses. “We have completed operational and financial restructuring by quitting non-core areas, reworking long-term debt and rationalising costs.”
Bajaj said the company has shuffled loans worth Rs 50 crore in a way that cuts interest and prolongs repayment.
It has also pulled out of aluminium dye casting business and shut down the manufacturing plant. Operations have been reorganised into five units —lighting, appliances, fans, luminaires, engineering and projects.
On the tie-up with British major Morphy Richards, he said the brand has been positioned in the premium slot and given an identity distinct from those in the Bajaj fold. “We have put in place a new distribution system for Morphy Richards and the brand is moving off the shelves very well,” he noted.
He said, of the Rs 2,500 crore small appliances market about Rs 100 crore accounts for the premium segment and this is expected to double by 2006. “We are targeting 25 per cent of this market by 2006.”
On Tuesday, there were reports suggesting a long-planned demerger of Bajaj Auto, the group’s flagship, would have to wait until the Bajaj brothers reach an agreement on the division of assets within the family. The objective of the move is to create two separate firms, one for manufacturing and the other for investments.