Calcutta, May 9: Ailing public sector company Andrew Yule Ltd is ready to stage a turnaround after seven years.

Backed by a comprehensive financial restructuring plan and a general improvement in business climate, especially in tea, the company is likely to post a Rs 2-crore profit in 2007-08.

The directors took stock of the financials of the company at a board meeting held today.

“The audited result is yet to come out, but we hope to post a marginal profit,” an official said.

The Calcutta-based PSU, which has a glorious past as a managing agency during the days of the British Raj, had suffered a loss of Rs 90 crore in 2006-07. It had been referred to the Board for Industrial and Financial Reconstruction in 2002. The Centre had recently approved a revival package for the company.

Andrew Yule is engaged in three businesses — engineering, electrical and tea.

It has 15 gardens in the Dooars, Darjeeling and Assam. “Tea prices moved up last year. It helped us. We hope this year will be even better,” the official said.

The revival package involves the conversion of a Rs 122.16 crore loan into equity, the provision of Rs 11.96 crore as a guarantee to banks, a waiver of Rs 32.59 crore and a writedown of Rs 224.12 crore equity.

The company hopes to bring down its accumulated loss from Rs 400 crore to Rs 120 crore through these measures.

The revival package, which is being implemented, envisages trifurcating the company. While tea will remain with Andrew Yule, two more companies will be created for electrical and engineering.

The restructuring also involves selling stakes in three subsidiaries — Dishergarh Power Supply Corporation Limited, Phoenix Yule and Tide Water Oil.

The company has received all clearances from the Centre to sell stakes in the subsidiaries. The proceeds from the stake sale will be utilised to revive the company.

“We hope to complete the sale this year itself,” the official said.

It has appointed consultancy firm Deloitte & Touche to oversee the stake sale exercise.

Andrew Yule holds a 26 per cent stake in conveyor belt maker Phoenix Yule, while Phoenix AG of Germany holds the rest.

In Dishergarh Power, it holds a 15 per cent stake, while its holding in Tide Water Oil is 26 per cent. Chevron of the US holds a 22 per cent stake in the lubricant maker.