RPG’s core businesses like power and tyres are set to prop up the group’s turnaround, even as its new economy businesses look out for new growth avenues.
The group’s overall turnover has grown by 4.5 per cent to Rs 6,690 crore from Rs 6,400 crore last year. Of the total turnover, power and tyres contributed 39 per cent and 30 per cent, respectively.
RPG’s utility major CESC has got a boost from a recent Calcutta High Court order awarding the company its long pending tariff increase. “We are hopeful that the development will change the complexion of CESC. The net effect of this to the topline will be an additional Rs 300 crore in revenues every year. We will have to see how we make use of this positive development,” RPG group chairman Harsh Goenka told The Financial Express.
Mr Goenka answered in the affirmative when asked whether the group was open to bidding for state-owned transmission companies that may come up for disinvestment. Other group companies dealing in power are RPG Transmission, KEC International, NPCL and RPG Cables. RPG group’s other flagship company CEAT turned the corner with a profit of Rs 3 crore in the year ended March 31, 2002, as against a loss of Rs 14 crore in the previous year. The company’s market share in tyres has increased by 4.5 per cent to 19 per cent, indicating that the turnaround strategy has worked. The increase in market share has been aided by the auto sector looking up.
With assets worth around $1.8 billion, the RPG group has been one of India’s fast growing business conglomerates and has major presence in retailing, entertainment, life sciences, information technology, power, tyres, telecommunication, among others.
The RPG group’s business portfolio is clearly divided into the old economy and new economy businesses. Under new economy, the group has a strong presence in communication, which contributes 13 per cent to its turnover, retail, contributing nine per cent, life science, which contributes seven per cent to the turnover, and entertainment with two per cent.
After hiving off its chemicals division, RPG Life Sciences — which is into bulk drugs,