Mumbai: Supreme Petrochem Ltd (SPL), the largest polystyrene manufacturing company in India with a capacity in excess of two tonnes per year, has sustained healthy performance in the first quarter ended 30 September 2003, by registering a net profit of 5.90 crore.

The net sales of the company has jumped by 12.39 per cent to Rs 236.13 crore as compared to Rs 210.09 crore in the corresponding quarter last year. By focusing on value-added speciality grades, the company has seen the share of speciality business grow to 19 per cent of the total domestic sales in the quarter ended September 2003.

The capacity utilisation of the company during the quarter has improved to 75 per cent from 68 per cent last year. Supreme Petrochem has set a target to improve capacity utilisation to 85 per cent this fiscal year. The company has also reduced its interest to Rs 4.55 crore from Rs 8.56 crore in the corresponding quarter last year.

Says a company spokesperson: "Optimistic economic outlook has augured well for SPL, as polystyrene consumption is linked to GDP [gross domestic product] growth. Improving efficiencies and controlling costs will continue to be our priority. Additionally, the expected GDP growth of 7.5 per cent is likely to boost domestic polystyrene demand by 15 per cent in the current year. We are also targeting more than 25-per cent growth in exports in value terms during the current year."

During the current year, the promoters propose to infuse an additional equity of Rs 12 crore at a premium of Rs 7.46 per equity share. In addition, International Finance Corporation, Washington, DC, has agreed to subscribe to foreign currency convertible bonds (FCCB) aggregating to Rs 18 crore convertible into equity shares at Rs 17.46 per share. This infusion of equity will strengthen financial parameters and help the company further reduce the interest cost.

SPL is a leader in the polystyrene business in the Indian market, with a vast range of grades including ESCR [environmental stress crack resistant], high gloss high impact, flame regardent toughened PS and custom coloured grades in general purpose polystyrene, high impact polystyrene and compounded polystyrene.

SPL is also the largest exporter of polystyrene from India (over 63,000 tonnes per annum including deemed exports) with clients in over 53 countries, bearing testimony to the global standards achieved by SPL in product quality and delivery. The company has successfully benchmarked itself against the best global polystyrene manufacturers on various parameters.