Managing director IC Sinha told The Financial Express that the Bharat Bhari Udyog Nigam subsidiary has already restructured some of its activities in accordance with the guidelines suggested in the package.

"We are slowly restructuring our offshore division into a central project section where we will concentrate on different engineering activities related to petrochemical plants and infrastructure projects. It will also offer services for material handling, ash handling systems and port modifications," Sinha said.

The offshore division was floated in 1984 to cater to the orders received from the Oil & Natural Gas Corp. However, it has not received a single order from ONGC since 1992. The project division was formed about a couple of years back, but it only accepts low valueorders to the tune of Rs 50 lakh.

"We want to increase this limit to Rs 25 crore and we have already started discussions on certain projects with IOC," Sinha said.

Burn Standard was incorporated on December 1, 1996 following the nationalisation and subsequent merger of Burn & Company Ltd and Indian Standard Wagon Company Ltd. The revival package was sanctioned on April 16, 1999 with retrospective effect from April 1, 1998.

In the very first year, the heavy engineering unit has nearly satisfied the targets laid down in the revival package. In 1998-99, Burn Standard's sale value of production was Rs 181 crore against the targeted Rs 183 crore. Turnover was Rs 272 crore.

As United Bank of India, which is Burn Standard's main banker, is unwilling to increase its exposure to more than Rs 30 crore despite its earlier assurance of Rs 49.5 crore against hypothecation of assets, the company is now desperately scouting for other bankers. The promised Rs 49.5 crore would include Rs 22-crore on fund-basedactivities and the balance on non fund-based activities.

Explaining the bank's helplessness, the UBI representative said it is bound by the Reserve Bank of India's guidelines aimed at checking the ever rising level of NPA.

"In the last one month or so, we held discussions with a number of banks. Even top government officials, both from the state and Centre, participated in these dialogues. Though nothing has been finalised, we hope to do so within a few weeks. However, it may not be a single bank, it can be a consortium also," Sinha said.

In the revival package, the Union Government and Bharat Bhari Udyog Nigam have agreed to convert their plan loan of Rs 28.68 crore and Rs 17.97 crore respectively into equity. This will increase Burn Standard's equity base from Rs 50.87 crore to Rs 97.52 crore.

Non-plan loans worth Rs 75.03 crore will be converted into zero rate debentures. These include Rs 60.67 crore received from the Centre, Rs 10.7 crore given by Bharat Bhari Udyog Nigam and Rs 3.66 crore givenby the Centre for implementing the company's voluntary retirement scheme.

Burn Standard's networth is expected to turn positive in the eighth year. "Projections reveal that Burn Standard & Co Ltd as a whole could earn cash profit from the second year but the accumulated losses would not get wiped out in the projected period of 10 years. However, the networth is expected to turn positive in the eighth year," the BIFR package states.