Chennai,Aug 13 (): Chennai based India Cements Ltd said that it may sell its stake in Jagan Mohan Reddy owned Jagati Publications. The investments in the Late YSR companies is under investigation by CBI who had arrested the ex-CM’s son Jagan for laundering of money.
India Cements had earlier sold its stake in Bharati Cements, which was owned by the same Jagan group, and made a profit of around Rs 35 crore.
N Srinivasan, vice chairman, India Cements and BCCI President revealed this while addressing company’s shareholders at Chennai today. He said the company made a profit by selling their stake in Bharati Cements, in due course they will also offload stake in Jagati Publications.
Andhra Pradesh-based Jagati Publications rated as one of the largest media houses in South owns Sakshi TV and Telegu daily Sakshi Newspaper.
India Cements has invested around Rs 135 crore in Jagan owned companies. It was initially interested in only investing in Bharathi cements but ended up investing in three of their businesses. The investment in media house got the CBI to go on the trail of Srinivasan since it reportedly got evidence that India Cements got favours from the YSR government in return.
Reacting to the Competition Commission of India’s (CCI) penalty on the company, Srinivasan disagreed with the penalty and denied that they had indulged in any activity which was mentioned in the order. He said it was just an order passed and it is not the final word on the matter and said it will not sustain.
11 cement companies including India Cements were fined around Rs 6,300 crore by CCI over forming a cartel for fixing prices.
Srinivasan said cement industry during the current fiscal year is under review, the growth was higher and improved to 6.60% as against a low of 4.70%, a year ago.
The western Indian region recorded a 13.30% growth, north and central recorded 11 and 9.30% respectively. The eastern Indian region recorded a poor 2.90% demand , while the south demand was dull due to lack of infrastructure and housing developments in Andhra Pradesh and Karnataka.
Additional capacity creation was much more than demand, the All India capacity utilization fell to lower at 74.37% as against 74.93% a year ago. In South, it fell by 2% from 65%.
India Cements Company’s gross turnover was around Rs 4222.69 core from Rs 3540.33 crore up by 19% is considered satisfactory since demand for cement is being less than satisfactory at 6.5% in 2011-12.
In the first nine months in the South, it was negative due to erratic supply of power in Andhra Pradesh and Tamil Nadu, less coal from Singareni Collieries Ltd with rising costs,inflations and increase in wages were factors that hit the industry.
48 MW power plant at Sankarnagar has been commissioned and is expected to go fully operational in 2012-13.
Stability of the expanded capacity of the Chilamkur plant and the second line at Malkapur will improve coming years profits.