ALL's Rs 160-Cr Write Off To Lift EPS By Rs 2

Chennai, January 18: | Updated: Jan 20 2003, 05:30am hrs
Ashok Leyland Ltd (ALL) shareholders approved the write off of Rs 160 crore against the share premium account, which would boost earnings per share by Rs 2. The share premium account will be reduced by 25 per cent to Rs 478 crore.

The Rs 160 crore write off comprises Rs 60 crore towards voluntary retirement scheme (VRS), Rs 20 crore for diminution in value of investment and Rs 80 crore for dimunition in the value of assets. There would be no cash outflow on account of the write off.

Dimunition in value has been provided for the investments made in the group component and project management firms. Also, the value of the assets at the Ennore plant, which manufactures Leyland engines, has been provided for, Mr RJ Shahaney, chairman, ALL, said at an extraordinary general meeting held here on Saturday.

The VRS expenses will also be set off against the share premium account. "We can charge the VRS expenses to the profit and loss account over a three-year period or adjust it against the share premium account. We have chosen the latter," Mr R Seshasayee, managing director, ALL explained.

The company is bullish about its prospects in the fourth quarter. "I would like to stick to my earlier estimate of a 15 per cent growth," said the managing director.

Among other things, ALL has formed an advanced engineering division to explore opportunities in cutting edge technologies. The newly formed division is scanning opportunities in the hitech sector (allied with commercial vehicle space) but no concrete strategy has been formalised.