Mr Narender Surana, managing director, STL, told The Financial Express, that the joint venture company - Sukronic Telecom Limited - will be floated with an equity capital base of Rs 5 crore soon. All the three partners will hold an equity of 33.3 per cent each. The venture would undertake manufacturing process of Outside Plant Equipment used in telecom projects, he added.

The project, being set up at Cherlapally near here, will manufacture special heat shrink polyolefins, accessories for required for optical fibre and outside plant equipment such as power closures, frames which are used in telecom projects, Mr Surana said.

The project is expected to go on stream in six months ie by March 2001. It will have a production capacity of 3,00,000 sets of all products per annum, he said. Both Nicco and German company will offer technical expertise, he said.

The project will be expanded further keeping in mind he faster growth in the telecom sector owing to privatisation of the industry, Mr Surana said.STL has also going ahead with the earlier proposed plans to manufacture optical fibre cable with an investment of Rs 30 crore in Hyderabad. The plant, to come up in a year's time, will have an initial capacity of 3 lakh kilometres of quark pre-form and other allied optical fibre products, Surana said.

To part finance the project cost, STL will be investing Rs 9 crore through internal accrual. For the remaining, ICICI has sanctioned a term loan of Rs 7 crore and the balance will be raised through rights-cum-private placement route, he said.

For the half-year ended STL's sales have declined to Rs 19.19 crore as against Rs 27.9 crore. This is was due to delay in DoT order supply, Mr Surana said, however, we are confident to surpass our last fiscal's sales of Rs 68 crore.