Suman Layak
ITC LTD, the Kolkata based cigarettes
major, is sitting on a pool of liquidity worth around Rs 1,000 crore.
The kitty was swelled by almost 750 per
cent in 2002-03 and the jump looks in sync with the company’s plans for acquisitions
and greenfield investments.
The major portion of the moneybag is held
as current investments and the rest as cash.
ITC had Rs 673 crore parked in current
investments by the end of financial year 2002-03, a more than 750 per cent jump on Rs 78
crore left at the end of 2001-02.
The company has also ended the year with Rs
378 crore of closing cash and equivalents against only Rs 44.6 crore in 2001-02, again a
jump of 750 per cent.
The total investments of ITC Ltd too have
gone up as a result of this jump in the current investments to Rs 906 crore in 2001-02.
In 2002-03 the company enjoyed a healthy
cash flow with cash generated from operations going up by eight per cent.
In the kitty
At the
end of financial year |
Cash
in hand and bank |
Current
Investments |
| 2000-01 |
35.41 |
- |
| 2001-02 |
44.21 |
78.01 |
| 2002-03 |
378.84 |
673.81 |
| (All figures in Rs crore) |
|
|
Most of the current
investment of ITC has been in various cash management funds and liquid funds and liquid
growth funds. The current investments are now 41 per cent of the total investment of ITC
Ltd including investments in various subsidiaries.
Of the Rs 673 crore, around Rs 150 crore
has been parked in UTI’s growth bonds, while around Rs 200 crore is with various
funds managed by Templeton.
The rest is divided among funds managed by
Alliance, Birla, Chola, HDFC, IDBI Principal, Prudential ICICI, Kotak Mahindra, Zurich and
others.
ITC has already outlined plans for
acquisitions in the specialty paper and paperboard industry. There have been market
rumours that the company is in talks with Ballarpur Industries.
The company may also go in for greenfield
investments in paper and is also looking at a farm forestry project.
The other area where ITC is looking to
invest is lifestyle retailing where the company is planning to expand its presence to the
foreign market.
The company is also looking at investments
in the new business areas, especially the FMCG sector that is not likely to turn
profitable in the next few years.
The company has entered segments like
branded packaged foods.
