Expect 2012 to sail without much concern: Sintex Industries

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Expect 2012 to sail without much concern: Sintex Industries

In an interview to CNBC-TV18, Sunil Kanojia, Group President of Sintex Industries said the company expects business to sail through in 2012, without much concerns. However, he said, even as the company’s order book stands at Rs 3,000 cr, there is delay due to the government policy paralysis.

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In an interview to CNBC-TV18, Sunil Kanojia, Group President of Sintex Industries said the company expects business to sail through in 2012, without much concerns. However, he said, even as the company's order book stands at Rs 3,000 cr, there is delay due to the government policy paralysis.

"The decision making is slow compared to last year; nevertheless we do expect that we will be able to still overcome. The last quarter is generally the strongest as far as Sintex is concerned, and we expect that the government by then would have taken care of its own house and things would have come to restoration and normalcy," he said.

Below is an edited transcript of Sunil Kanojia's interview to CNBC-TV18. Also watch the accompanying video.

Q: A lot of the stock price fall has to do with what has happened with the rupee. How are you gauging the situation and what kind of losses are you looking at?

A: I don't know whether the present levels will be sustainable by March 2013 it would go up or down that is anybody's guess. What we have been hearing is that the dollar has to come down and we have one year and three months pending, so by then we expect it to be somewhere around 48-49. Hence, the notional loss would have also come down, we had taken the liability at about Rs 45 to a dollar and obviously on the day of redemption whatever is the prevailing exchange rate, if it is lower than or higher than 50, accordingly the loss or gain has to be taken in.

Q: What are you plans regarding your debt position at the moment?

A: The interest rate has to be seen in the backdrop of what is happening in the macro-economic parameters, which is one in terms of the exchange rates having gone up 13 spikes in the past. However, off late, there is an assurance that probably now the reversal will take place. Hence, we expect some relief coming with the interest rate coming down from here on. We also have to see that the volumes of the company in the last quarter has grown by about 26%, therefore, both ways there was an increase in sales as well as there was an increase in interest rates which impacted. However, if you consider the debt without the FCCBs there will be only 0.4-0.5x of the equity.

Q: What is the impact that you are seeing on the overseas order books?

A: The overseas markets generally have some lag as far as our business is concerned. The CEOs have been talking about certain drag but that should change somewhere around in the month of February when we have the budget and the overseas subsidiary plan for 2013 will be worked on. I think 2012 will sail through, I don't see any problem. Generally, there is a lag of about 8-9 months before the actual impact of any sluggishness where the sales will be going down.

Q: Can you give us the idea of the overall order book. We were told it's around Rs 3,000 crore. Is it likely to get any better?

A: It is about Rs 3,000 crore. We have been adding orders, we have been executing orders, but there is little delay because of the government policy paralysis. The decision making is a little slow, not as we had seen last year; nevertheless we do expect that we will be able to still overcome. The last quarter is generally the strongest as far as Sintex is concerned, we expect that the government by then would have taken care of its own house and things would have come to restoration and normalcy.