Consolidated FY10 capacity seen at 37000 tonne: Ess Dee

Here is a verbatim transcript of the exclusive interview with Sudip Dutta on CNBC-TV18. Also watch the accompanying video.

Q: If we could just get some brass tacks cleared from you, what is your current capacity? You bought in India Foils; our calculation is you should have gone up by 37,000. Your capacity was 9,100 previously, and aluminium prices fell so much. Why didn't we see a bigger jump in operating profit? If you can just shed light on these two, just brass tacks first?

A: The current capacity of Ess Dee Aluminium is around 18,000 tonnes and in India Foils is around 19,000 tonnes. We are operating Ess Dee Aluminium at full capacity. We are operating India Foils around the 9,000 tonnes capacity. It will increase, in the next six months time, to the full 19,000 tonnes.

As regards the metal prices, whether it is up or down, we are actually doing it on a cost-plus basis. So, it has not affected us anywhere in our business.

Q: How did you do in terms of margins this quarter compared to the previous quarter or year ago quarter?

A: If you look at it on a QoQ basis or on a YoY basis, our margin is about the same. In this quarter as well, we made an EBITDA level of around 29%, which comes to around Rs 32 crore. The PBT level is around 22%, which comes to Rs 25 crore.

Q: What about merging India Foils with your company?

A: We have already submitted the MDRS, the merger file to the BIFR. We are awaiting their approval and we expect that we will get the approval very soon.

Q: Let's just look at India Foils as it stands right now. It is sitting with sales of around Rs 28 crore. If it has got about the capacity you already have, what is your capacity utilisation? Could it be possible that by the time you merge, you could take this up to about Rs 200 crore or Rs 150 crore, if you were at full capacity utilisation, or is there some problem in the plant itself?

A: India Foil has two factories. We have just started one factory on April 28. That was actually a closed factory; we have reopened that on April 28. Another factory is running. We are operating that factory in this quarter and we are making around Rs 28.58 crore. If you see that, this is the first time after 10 years of India Foils running that the EBITDA has come into positive territory. This is the first time after 10 years.

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