01 April 2022, Mumbai:
The Union government has decided to sell National Textile Corporation (NTC) to boost its operational viability.
For the last two decades, NTC has been incurring losses, though it made a technical profit of Rs 969 crore in FY17.
Several plans to revive the yarn and cloth manufacturer over the decades failed as it had to close down several unviable units.
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The latest attempt to revive the corporation in 2012 involved a Rs 5,500 crore package by the then Board for Industrial and Financial Reconstruction (BIFR).
The package allocated funds for meeting expenses like clearing up outstanding statutory dues, one-time settlements (OTS) with financial institutions, interest payment and compensation under modified VRS.
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Moreover, NTC also spent Rs 1,646 crore on modernization of mills under the revival scheme.
However, the fund infusion failed to revive the corporation as it faced a steep rise in raw material costs.
In FY20, the company reported a 13 percent rise in a net loss to Rs 350 crore.
The company’s turnover declined y 21 percent to Rs 850 crore during the year while its net worth fell by 20 percent to Rs 1,381 crore in FY20.
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