JMT Auto Board recommends Rs.1 dividend

JMT Auto Ltd has announced that the Board of Directors of the Company at its meeting held on June 30, 2007, inter alia, has transacted the following:

1. DISCUSSIONS ON BUSINESS PLANS, DOMESTIC AND EXPORT VISIBILITY:

The Chairman highlighted that in view of the growing demand in the Excavation segment, Tractor Segment, Exports and the Bearing industry, the domestic business is likely to grow by 25%. However the interest rate hike would hamper growth in all areas, which remains to be seen in the coming months.

The Chairman felt that the Company needs to consolidate, bring down costs, improve efficiency and productivity. The members discussed that with the present expansion already undertaken the Company should see a gross turnover of at least Rs 270 crores. They further discussed that the future expansions planned are in sectors which are not cyclical and non-automotive like Hydraulic Industry, Oil explorations and other off the road niche market.

The Export division of the Company would grow by at least 150% this year from Rupees 8 crores to Rs 20 crores and the next year onwards @ 50% per annum. On the export front targets have been made and so the Company is accordingly working towards the same.

The Chairman then placed before the Board the Capex Plans for discussion among the Board members. Detailed discussions took place at length and a capital budget of Rupees fifteen crores was decided to be formulated for the forthcoming financial year.

2. The Board recommend a dividend at the rate of Re 1 per share out of the current profits of the year on equity shares and that subject to the approval of the members in the annual general meeting.

BUSINESS REVIEW:

The Board noted and took on record the following :

(i) That all applications have been made under the Mega Project Policy of Jharkhand for which the Company is entitled to capital subsidy, interest and Vat subsidy.

(ii) That the Forging unit of the Company has started commercial production. New equipments, low on fuel consumption have been acquired which would lead to maximum savings on fuel cost and productivity improvement.

Source : Equity Bulls

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