KICL Puts Loss Making Fertiliser Unit On The Block

You bend to grow.  So goes an old adage. Wisdom lies in a practical approach. That is what this management is doing. Rather than clinging on to a continuously losing unit, it is wiser to let it go. Well, the bosses at Kothari Industrial Corporation Ltd (KICL) have now chosen to give up its SSP (single super phosphate)-making unit in Chennai. Well, they see a clear gain in giving this one up. Production of SSP at its Ennore unit was discontinued due to scarcity of imported quality raw materials. Also, working capital has proved a big issue. Given these, this facility was leased out to one of the manufacturers of fertilizers in Chennai. The lease is still on. A comprehensive review, however, has suggested that the company will be well served by getting rid of this unit. Well, it has now decided to sell the Ennore facility on a slump sale basis. The proposal has since got the approval of the shareholders. The business environment has turned topsy-turvy of late. Also, the debt burden of the company is mounting by the day due to assorted statutory and legal compulsions. Hopefully, the sale of SSP facility will ease the debt burden of KICL which is pining to return strongly in a new avatar under a fresh management.