Dunlop India chairman Pawan Ruia with managing director Samir Paul in Calcutta on Wednesday. A Telegraph picture

Calcutta, Dec. 20: Dunlop India has placed a Rs 600-crore revival package before the Board for Industrial and Financial Reconstruction (BIFR). And the good news is owner Pawan Ruia is hopeful of a turnaround sooner than expected.

The company has an accumulated loss of Rs 410.8 crore as on March 31, 2006, which has eroded its net worth.

Ruia said the management was exploring various options to pull the company out of the red.

“This may be possible even during this fiscal. We intend to clean up the balance sheet,” Ruia said at the 79th annual general meeting of the company today.

The BIFR package involves Rs 50-55 crore of equity infusion by way of promoter’s contribution and a possible rights issue.

At the end of last fiscal, Dunlop’s net worth stood at a negative Rs 261 crore. Apart from expanding the equity, the other way out would be to revalue the company’s asset.

Dunlop has restarted operations at the Ambattur plant on August 27 and the Sahagunj plant on October 31 this year after prolonged negotiations with workers.

Tyre from Ambattur has already hit the market and the turnover is expected to touch Rs 100 crore this fiscal. Some cash profit is also expected this year.

The tyre industry is going through a good phase with high demand from trucks and buses. Dunlop is also focusing on this category.

Banks and institutions, including a foreign one, are ready to extend loans to the revival package. The debt part of the package could be Rs 550 crore.

Dunlop requires Rs 200 crore as working capital, Rs 150 crore for past liabilities, Rs 100 crore refurbishment, among others.

Stock re-listing

Ruia said Dunlop’s stock is likely to be re-listed on the BSE within a month. Trading in the scrip has been suspended from February 2003.