According to a report in Financial Express newspaper, the company has also reduced employee salaries by 10 per cent in order to reduce cost. Furthermore, the salary disbursements to employees are also being delayed.
Jindal Steel & Power (JSPL) shares fell over 10 per cent on Friday on reports that the steel major has put on hold its expansion plans and said the company is not in a “tearing hurry” to sell some of its non-core assets. The scrip settled 11.59 per cent down at Rs 64.05.
The company has also reduced employee salaries by 10 per cent in order to reduce cost, according to Financial Express newspaper. Furthermore, the salary disbursements to employees are also being delayed.
According to the report, a JSPL spokesperson confirmed the development and said employees voluntarily recommended giving up 25 per cent of their respective take-home pay. “The senior management was overwhelmed by their austerity suggestions and accepted the token gesture to bolster the company’s stance against the challenges faced, albeit a 10 per cent contribution by way of a waiver was accepted from all employees as an interim measure, with the exception of workmen,” the spokesperson explained.
The company has been reducing its employee costs in FY16. Wages and employee benefits have reduced by 7.6 percent at Rs 254 crore during July-September 2015 against Rs 275 crore in April-June 2015. JSPL had total debt of Rs 42,534 crore as on September 30, 2015, of which the net debt stands at Rs 42,216.5 crore, data from Bloomberg show.
“At this moment we are not going for any expansion. The idea is to fully utilise assets we have built up. So no expansion at this moment and no capital expenditure for a while,” JSPL managing director and CEO Ravi Uppal was quoted as saying by PTI on Thursday.