The Lancer model will be available in both petrol and diesel versions by the end of this month. CK Birla, who for the first time chaired the 56th annual general meeting (AGM) on Thursday said Hindustan Motors has outlined a strategy under which the company will adopt different approaches for marketing of its Ambassadors, RTVs, Trekkers and Lancers.

The Lancer model's plant, which is being manufactured in collaboration with Japan's Mitsubishi Corp, has been set up in a record time of one year. Production and quality proceedures have been completed over the past four months, he added.

Executive director A Shankarnarayan said that the new plant's manufacturing capacity will be 24,000 Lancers a month. More than 60 per cent of Lancer components have been indigenised. CK Birla said that the Lancer's engine and the transmission system are being manufactured at the company's Pithampur unit.

Hindustan Motors reported a profit before interest, depreciation and taxation of Rs 131.58 crore till March 31, 1998, which is 6 per cent higher than Rs 124.49 crore in 1996-97. However, due to an increase in tax provisions of Rs 8.95 crore in 1997-98, against Rs 5.13 crore in the previous year, the net profit was marginally higher at Rs 39.35 crore, against Rs 39.31 crore in 1997-98. The board recommended a dividend of Re 1 a share, which was quoting below par at the major stock exchanges.

Birla announced that the proposed Rs 54-crore rights issue will open on September 21 and close on October 28. The issue will be in the ratio of 1:2 (one share will be issued for every two equity shares held).

The proposed rights issue will give the shareholders the choice to either subscribe to equity shares or opt for the 16 per cent debentures convertible after 17-1/2 months.

According to CK Birla, the company has embarked on a Rs 503-crore expansion -cum-modernisation plan to which financial institutions have committed Rs 320 crore. Another Rs 53.75 crore will be mobilised from the rights issue and the rest will be from internal accruals.

The company's working in the first five months of the current year showed an increase in the sales revenue of 5.4 per cent. The production of Ambassador cars have declined to 21,382 in 1997-98, against 24,294 in the previous year. CK Birla felt that this was due to the ongoing recessionary trend in the economy.

The company slipped into the red in the first three months of the current financial year till June 30, 1998. It reported a net loss of Rs 3.08 crore, according to the unaudited provisional financials. Responding to the issue of another round of voluntary retirement scheme at the Uttarpara unit, Shankararayan said: "We will be considering it from time to time".