Economic Times reported that Uttam Galva group,which recently acquired majority stake in the ailing Lloyds Steel,would turn around the fortunes of the acquired company and planned to double its operating profit in about a year.
Mr Ankit Miglani deputy MD of Uttam Galva said that"We are confident of turning around the company.We hope that Lloyds Steel will attain net profit level in next one year and its EBIDTA will be doubled in that period."
He said that"Lloyds Steel used to raise money for working capital from secondary and tertiary market which increased its cost of funds to 24%to 25%.Post-acquisition,we are planning to raise working capital from public sector banks,which will significantly reduce the cost of funds."
He added that it has already started discussions with the some PSU banks and expects to get a letter of credit worth INR 1,500 crore.
He said that"We will also increase the operational efficiency with better product mix,"adding that the company plans to increase the production capacity to 0.75 million tonne per annum against 0.5 million tonne now.
He further added that"We are mulling to change the name of the company to Uttam Value Steels.However,nothing has been finalized yet."
Uttam Galva Group,promoted by Mr Migalni Family,has acquired 58.35%stake in Lloyds Steel,which posted net loss of INR 213 crore in the last two financial years.Lloyds Steel,with a steel making capacity of 1 million tonne per annum,has a total long term debt of INR 441 crore on its books.
