Financial Daily from THE HINDU group of publications
Tuesday, Dec 03, 2002
Financial Daily from THE HINDU group of publications Tuesday, Dec 03, 2002 |
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Sick Units Corporate - Sick Units I've been done in by the system: Mardia Vinod Mathew
AHMEDABAD, Dec. 2 HE dons the dubious mantle of being the Indian banking industry's premier defaulter in the corporate sector with his group's aggregate dues touching Rs 1,404 crore. Mr Rasiklal S. Mardia, however, disagrees. He is convinced that the total dues of the three group companies - Mardia Chemicals (MCL), Mardia Steel and Mardia Leasing & Finance - cannot be over Rs 300 crore. Clearly, this does not include the penal interest that has been mounting for the last few years. Talking to Business Line, Mr Mardia said he had been done in by a system that allowed the big-ticket companies such as Arvind Mills and Essar Steel to go in for debt recast plans. He has already challenged the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Act in the Supreme Court, the last hearing having been on November 29. "The Securitisation Bill, if unchallenged, will lead to an unhealthy control of the industry by the money lending institutions. Now, it is the closed down chemicals factory... tomorrow, it could be the Rs 880-crore Mardia township in Surendra Nagar. This onslaught has to end and I am sure of surviving it," Mr Mardia said. It was a six-month shutdown of the Vatwa factory in1996 that led to his company slipping into losses for the first time, says Mr Mardia. With some Rs 700-crore investment taking place at roughly the same time in the Surendranagar plant, MCL showed a net loss of Rs 400-odd crore in 1997. Thereafter, it has been a downhill slide for MCL, with both the steel and leasing units soon downing their shutters. "I am not asking for any write-off on the principal amount like others. I have two of India's largest chemical plants at MCL in chloro sulphonic acid and vinyl sulphone, which are currently running below installed capacities. It will take only two years for the present turnover of Rs 200 crore to touch Rs 1,000 crore. It needs an infusion of only Rs 45 crore for the 72-MW power plant to save Rs 84 crore annually in power bills," he added. Earlier, the Board for Industrial and Financial Reconstruction (BIFR) had put paid to Mr Mardia's hopes of availing the time-tested route of corporate India. His three-year-long attempt to get MCL sick by the BIFR fell flat as the BIFR charged him with having siphoned away large funds from the company, resulting in the erosion of its net worth. With the latest blow coming in the form of the seizure of the MCL factory, all cards seem to be stacked against Mr Mardia. However, he seems to be gearing up to take on his detractors and feels history is in his favour. The two legal battles - the environmental issue in the Supreme Court and a stay on the BIFR ruling by the Appellate Authority for Industrial and Financial Reconstruction (AAIFR) - have both gone his way. And the leading exporter of dyes and intermediates from the country till 1995 feels he will live to fight another day.
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