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Strategies & Market Trends : India Coffee House -- Ignore unavailable to you. Want to Upgrade?

To: Mohan Marette who wrote (3737)	2/15/1999 11:27:00 PM
From: Mohan Marette	Respond to of 12475

Hindustan Lever net surges 44%; (Courtesy:Business Standard) personal products, foods, exports star performers Our Corporate Bureau in Mumbai Riding on the back of the absorption of Pond's, strong growth in personal products, foods and exports, Hindustan Lever's net profit (before exceptional items) rose 44.32 per cent to Rs 837.44 crore (Rs 100 crore = Rs 1 billion) in 1998. Net sales grew 21.25 per cent to Rs 9,481.85 crore and the company declared a total dividend of Rs 22 per share for the year. Despite equity expansion after the Pond's merger last year, Lever's earnings per share rose 30.4 per cent to Rs 36.70 in 1998. After providing exceptional items of Rs 31.73 crore, Lever's net profit touched Rs 805.71 crore, up 43.78 per cent. Chairman K B Dadiseth said in Mumbai on Monday Lever had tided over tough market conditions in 1998, but warned against complacency. “1998 was a tough year. We do not see it any better this year, but we will continue to do better than the market,” he added. The Lever performance however failed to cheer the market players and the stock dipped to the day's low of Rs 1981.25 before closing marginally higher at Rs 1984 at the BSE. It closed Rs 42 lower than it previous close of Rs 2026. On the NSE it dipped to the day's low of Rs 1970 and closed at the same level. It lost Rs 59 at the NSE over its previous close. A total of over 5.3 lakh shares changed hands on both bourses. The stock opened weak on both the exchanges and soon after the results were announced punters off loaded their long positions, which pushed down the stock price. Growth in 1998 was propelled by strong performance in personal products, branded staple foods and exports. Helped by the addition of Pond's and Lakme's businesses, group personal products business grew 21 per cent in volume terms and branded staple foods jumped 42.85 per cent in value terms. Soaps and detergents and beverages continued their steady growth, while ice creams fared poorly, growing only 1.1 per cent in value terms and 5 per cent in volume terms. Lever's newly-launched brands of Kissan Annapurna atta and salt continued to do well, their production touching 185,000 tonnes in 1998. Higher net interest income at Rs 120 crore against Rs 51 crore also added to profitability. Lever spent Rs 179 crore last year on capital expenditure and commissionede seven new factories. Forty-one brands were launched and 41 brands re-launched. New role planned for board Our Corporate Bureau in Mumbai Hindustan Lever plans to turn its board into a strategic, policy-making body and delegate operational decision-making down the line. In the coming years, the Lever board is expected to confine itself to dealing with broad, macro-level issues concerning the company. It will leave day-to-day decision making to a host of younger managers, expected to take charge of the company's different categories and segments. Top Lever sources said in the newer regime, younger managers will get more responsibility and power. They will deal with operational activities relating to their business and report to the director. “The idea is to empower the younger managers and attract talent. The board should ideally concern itself only with policy issues,” said top Lever sources. The project millennium plan, just been kicked off in the company is expected to examine the role of the board in detail. The proposed change in the board's role is a major one for Hindustan Lever, which has traditionally had a very strong operational board. Even now, all business heads are represented on the board.