The average capacity use of the 100 big companies (sales above Rs 500 crore) rose from 79.87 per cent in 2001-02 to 83.08 per cent in 2002-03. Out of the total sample, 61 companies achieved higher capacity use in 2002-03 with 17 companies hitting over 100 per cent.
Among the companies achieving over 100 per cent capacity use, two each are in the tyre companies, pharma companies and fertiliser companies, one each in breweries, tea, textile, cigarettes, cement, other chemicals, steel, cotton textiles, paper, cement and miscellaneous.
The tyre companies hitting over 100 per cent capacity use were CEAT (153.19 per cent) and Apollo Tyres (108.71 per cent). The pharma companies were Cipla (144.51 per cent) and Ranbaxy Lab (102.14 per cent). The fertiliser companies were Spic (111.95 per cent) and Rallis India (104.50 per cent).
The others in the 17 elite group were McDowell & Co (389.58 per cent), Tata Tea (383.61 per cent), Liberty Oil Mills (256.83 per cent), Century Textiles (168.59 per cent), Godfrey Philips (138.1 per cent), Castrol India (125.51 per cent), National Steel & Agro (124.46 per cent), Mahavir Spg (115.81 per cent), JK Paper (114.57 per cent), Finolex Inds (110.7 per cent) and Guj Ambuja Cement (109.34 per cent).
Companies in the tyres and tubes and fertilisers industries were the star performers with all of them achieving an average capacity use of more than 96 per cent.
CEAT achieved the highest average capacity use (153.19 per cent) among the tyres and tubes companies in 2002-03. In automobile tyres, CEATs main product, the company achieved the capacity use of 153.19 per cent during 2002-03. Production of automobile tyres during the year 2002-03 was 62.21 lakh numbers, 29 per cent higher than the production of 48.18 lakh numbers during the previous year. The production of automobile tubes in 2002-03 was 32.75 lakh numbers, against 32.12 lakh numbers in 2001-02, an increase of 1.96 per cent.
According to Directors Report, with the objective of offering the best products at competitive prices to its customers, CEAT embarked on a programme to mitigate the adverse cost impact through operational improvements. The programme included maximisation of capacity utilisation, enhanced operational efficiencies, prudent working capital management and introduction of several new products in different categories to meet the emerging customer needs. The company pursued a strategic initiative of intensifying outsourcing to expand the product range and increase volumes. Apollo tyres was another star performer, with a capacity use of 108.71 per cent. Automobile tyres production of the company during the year 2002-03 was 41.66 lakh numbers, 25.14 per cent higher than the production of 33.28 lakh numbers during the previous year. The output of automobile tubes of the company in 2002-03 was at 36.91 lakh numbers, against 30.54 lakh numbers in 2001-02, an increase of 20.82 per cent.
As reported in the accounts, the expansion programme to increase the capacity of Kalamasserry plant of Premier Tyres Ltd, subsidiary company which is under lease with Apollo Tyres, from 58 tonne per day to 78 tonne per day, is being implemented in a progressive manner. Critical equipment has been upgraded/replaced to ensure that the specifications and quality of produce, matches the best possible standard.
Among the fertiliser companies, Spic achieved the highest capacity use (111.95 per cent) during 2002-03. Urea production of the company was limited to six lac tonne as against the budget of 6.24 lac tonne due to turnaround maintenance of Ammonia and Urea Plants, which had taken 57 days.
On the other hand, during 2002-03, Spic produced 1,47,475 mt of complex fertilisers as against 2,23,734 mt during the previous year.
The pharma industry showed a marked improvement in capacity use during 2002-03, because of a spurt in demand. This led to a sharp increase in profitability. The average capacity utilisation of 10 pharma companies increased from 72.70 per cent during 2001-02 to 81.50 per cent during 2002-03. Among ten pharma companies, Cipla achieved the highest capacity use (144.51 per cent) during 2002-03. Its tablets and capsules production increased from 4,466 million during 2001-02 to 7,224.1 million during 2002-03. According to Directors Report, the first phase of Ciplas manufacturing complex in Goa is now fully operational. In April 2003, commercial production commenced in the second phase. This has facilities to manufacture the entire range of anti-cancer and hormonal drugs. The state-of-the-art Goa complex is equipped to meet the growing requirements of the companys international business.
In the cement industry, Gujarat Ambuja Cement achieved the highest capacity utilisation of 109.34 per cent during 2002-03 as against 80.07 per cent in the previous year. Its cement production increased from 72.06 lakh tonne in 2001-02 to 98.40 lakh tonne in 2002-03. The average capacity utilisation of six cement companies increased from 59.43 per cent in 2001-02 to 70.13 per cent in 2002-03.