| Sinking fortuneS
Mumbai, July 31: India Inc has started toting up the losses it suffered after the torrential rains that lashed Mumbai and parts of Maharashtra last Tuesday, which grounded the country's financial capital to a halt. The collective tab is estimated at anywhere between Rs 750 crore and Rs 2,000 crore.
Even as companies hunker down to do their sums, insurance companies are bracing for a barrage of claims next week.
Three days after the city received a record rainfall, the casualty list in India Inc is now swelling with units located in suburbs like Kalyan and Bhiwandi joining the affected register. Corporate mavens expect a production loss of at least a week and they admit that second quarter performance will be affected marginally as a result.
According to the Federation of Indian Chambers of Commerce and Industry, Mumbai alone lost business income of about Rs 450 crore over two days as floods hit the city. While a clear picture relating to the extent of losses is only expected to come by next week, insurers expect to be hit by a tide of claims. No one will yet hazard a guess as to how high these will be, but insurance circles indicated that they are likely to be made in four areas. Motor insurance claims are expected to top the list; they also expect claims from the retailing community (shops and establishments) as well who have been affected by the floods. Industries, whose machinery have been affected due to floods, are also likely to seek relief.
'The insurance companies are also likely to face loss of profit claims from those companies which had to shut down their units due to floods,' sources added.
The downpour has affected companies like Reliance Industries Ltd (RIL) and Bombay Dyeing, which had to shut down their plants at Patalganga in Raigad district due to flooding. Bharat Petroleum Corp also had to cut production at its refinery in north-east Mumbai, which has an annual output of 9 million tonne.
However, the losses are not restricted to these districts alone. Suburbs close to the city such as Kalyan and Bhiwandi, which are dotted by several units and godowns, have also been hit by the rains and the decision to open a nearby dam to avoid a burst.
Sources said the worst affected are the numerous powerloom units located in Bhiwandi. These units are now facing serious losses with raw material such as yarn being swept by the flash floods. 'Many of these units are not insured. It will take quite some time for them to be back on their feet,' says a textile manufacturer who lost yarn worth Rs 1 crore.
However, the textile industry is not alone. Pharmaceutical companies, which have godowns in this belt, have been affected. FDC Ltd, a mid-sized pharma company, has said its godowns at Bhiwandi taluka have been damaged due to heavy rains and flooding.