The Telegraph
Since 1st March, 1999
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HPL expects next year to be better

Calcutta, Sept. 30: Haldia Petrochemicals Limited (HPL) expects a substantial upswing from the beginning of next year, going by recommendations made by international consultants that end product prices will go up and naphtha prices will go down around that time.

Global petrochem industry experts like CMAI, Nexant Chem Systems, SRI and many others have predicted that the petrochemicals business is poised to witness a significant and sustained upturn from early 2003.

According to forecasts by these reputed consultants, end product prices are expected to improve while naphtha prices driven by that of crude oil are likely to experience a downward trend. This will help in recovery of margins to a large extent.

Moreover, the next peak (2004-05) should mirror the late 1980ís and not 1995, which will remain for a longer duration. The peak will result from a structural shortage of supply, not a temporary outage, consultants said.

HPL has also been able to get a favourable debt-restructuring package from its lead financial institution IDBI, which will further boost the bottomline of the company.

The directorsí report, which was placed before shareholders at the annual general meeting today says that the company registered a net loss of Rs 501 crore for the eight months from August 2001 to March 2002. The company had to bear a high interest burden of Rs 369 crore in this period.

Although loan repayments of more than Rs 100 crore were made during this period the company was unable to avoid default in payment of interest on some of its loans.

HPLís EBDIT (earning before depreciation, interest and tax) stood at Rs 71.3 crore in the eight-month period. At todayís AGM, shareholders approved the profit and loss account, audit committee report and induction of new directors on the board.

Following the resignation of Ratan Tata and Shyamal Gupta from the board of HPL, two other representatives. H. K. Sethna, a Telco representative and S. Mohan Gurunath of Tata Power have been inducted into the HPL board on September 28.

HPL registered a sales volume of 323 kilotonnes of polymers and 222 kilotonnes of chemicals in 2001-02 with a gross value exceeding Rs 2,500 crore.

Despite an intensely competitive and depressed business scenario the company has been able to make significant in-roads in both domestic and export markets achieving more than 20 per cent market share on an all-India basis and around 55 per cent market share in the eastern region.

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