Of the selected 319 companies, the top 10 according to the interest sales ratio during 1998-99 are Mardia Chemicals (71.38 per cent), Gujarat Sidhee Cement (43.05 per cent), Hotel Leelaventure (25.47 per cent), Essar Steel (22.20 per cent), Punjab Wireless System (21.64 per cent), Lloyds Metals & Engg (21.44 per cent), Lloyds Steel Industries (20.28 per cent) Nagarjuna Fertilisers (20.27 per cent), SRF (18.67 per cent) and Gujarat Alkalies (18.12 per cent). Most of the above companiesinterest cost has increased significantly during the current year and their sales figures declined. For example Gujarat Sidhi Cement's interest payment has increased by 230.2 per cent to Rs 69.53 crore in 1998-99 from the level of Rs 21.06 crore in 1997-98, But the sales of the company declined from Rs 204.98 crore in 1997-98 to Rs 161.51 crore in 1998-99.

So the interest-sales ratio was significantly higher during the year 1998-99. In contrast, the interest cost of Hotel Leelaventure rose significantly by 652.2 per cent to Rs 30.99 crore during 1998-99 from Rs 4.12 crore during 1997-98. Its sales figure increased by 6.46 per cent to Rs 121.68 crore in 1998-99 from the level of Rs 114.30 crore in 1997-98. Among the 319 companies, 149 companies witnessed a fall in interest expense-sales ratio, while 169 companies showed a higher ratio in 1998-99 compared with 1997-98. One company's ratio for the previous year could not be calculated due to negative interest expenses figure.

A significant fall in the ratiowas witnessed in the case of Bajaj Hindustan (10.17 per cent in 1997-98 to 6.86 per cent in 1998-99), Birla Ericsson Optical (9.84 per cent to 5.78 per cent),Essar Oil (7.72 per cent to 4.28 per cent), Floatglass India (26.90 per cent to 17.98 per cent), Jindal Vijaynagar Steel (26.35 per cent to 15.36 per cent), National Radio (18.16 per cent to 12 18 per cent), SRF (23.21 per cent to 18.67 per cent) and Essar Shipping (21.52 per cent to 17.09 per cent).

Most of the above companies interest costs have declined during the current year and their sales figure increased. The net sales of Bajaj Hindustan for the year 1998-99 was higher at Rs 295.23 crore as against Rs 248.66 crore for the previous year. But the interest cost of the company declined from Rs 25.28 crore in 1997-98 to Rs 20.25 crore in 1998-99. So the interest-sales ratio of the company declined significantly during the current year.

On the other hand, a significant improvement in 1998-99 was noticed in the case of Gujarat Alkalies (9.86 percent in 1997-98 to 18.12 per cent in 1998-99), Gujarat Sidhee Cement (10.27 per cent to 43.05 per cent), Hotel Leelaventure (3.60 per cent to 25.47 per cent), Kajaria Ceramics (10.20 per cent to 16 per cent), Lloyds Metal & Engg (10.18 per cent to 21.44 per cent), Lloyds Steel Inds (10.58 per cent to 20.28 per cent), Mardia Chemicals (20.06 per cent to 71.38 per cent), Mukand (7.39 per cent to 12.74 per cent) and Narmada Cement (1.89 per cent to 10.54 per cent).

Most of the above companies interest cost has increased, but their sales declined significantly. In the case of Gujarat Sidhee Cement, the net sales has come down drastically from Rs 204.98 crore in 1997-98 to Rs 161.51 core in 1998-99 mainly due to slack market demand. But the interest cost of the company increased by 230.2 per cent to Rs 69.53 crore during 1998-99 from the level of Rs 21.06 crore during 1997-98. Similarly in the case of Mukand, the net sales has decreased by 21.4 per cent to Rs 706.25 crore in 1998-99 from the level of Rs 898.57crore in 1997-98. And the interest cost of the company increased by 35.5 per cent to Rs 89.95 crore during 1998-99.

The top 10 companies that shelled out the most in finance charges (interest expense only) during the year were, Reliance Industries (Rs 728.81 crore), Essar Steel (Rs 502.40 crore), Telco (Rs 309.57 crore), Tisco (Rs 301.56 crore), Grasim Industries (Rs 262.38 crore), Nagarjuna Fertilisers (Rs 246.20 crore), Century Textiles (Rs 197.60 crore), Tata Chem (Rs 194.51 crore), Lloyds Steel Inds (Rs 177.74 crore) and Associated Cement (Rs 162.45 crore).

Although most of the above companies figured among the top 10 in the previous year also, there was a substantial difference in their ranking, especially where interest as a percentage of net sales was considered.

The interest-sales ratio for 319 big companies increased from 5.09 per cent in 1997-98 to 5.61 per cent in 1998-99, which were indicative of the fact that the interest burden on corporate sector witnessed an upward trend in that year.This upward trend in the interest-sales ratio is not due to the higher rate of interest charge only. This was probably due to the recessionary condition of the economy and the lower demand. In the sector-wise analysis, an upward trend in the ratio from 1997-98 to 1998-99 was witnessed in the case of tobacco (3.02 per cent in 1997-98 to 4.68 per cent in 1998-99), cotton textiles (4.79 per cent to 6.09 per cent), paper & paper products (4.33 per cent to 5.40 per cent), cement & cement products (5.39 per cent to 6.81 per cent), electricity (6.64 per cent to 6.65 per cent), hotels (3.47 per cent to 3.51 per cent), iron & steel (8.45 per cent to 9.51 per cent), pharmaceuticals (2.51 per cent to 2.77 per cent), fertilisers (8.25 per cent to 9.12 per cent), automobiles (2.74 per cent to 2.99 per cent) and electrical goods (4.47 per cent to 4.68 per cent). With the present situation the iron & steel industry was the worst affected.

Against a 3.3 per cent drop in industry (5 units) sales of steel products, themajor Tisco's sales at Rs 6,275 crore were 2.5 per cent lower than in the previous year. Against a drop in sales, the interest cost increased from Rs 259.68 crore in 1997-98 to 301.56 crore in 1998-99. So the interest-sales ratio increased from 4.04 per cent in 1997-98 to 4.81 per cent in 1998-99.

A reverse trend can be seen in the case of aluminium (4.47 per cent in 1997-98 to 4.42 per cent in 1998-99). Computer software (4.42 per cent to 4.02 per cent) and tea industry (2.45 per cent to 2.12 per cent).