NARMADA GELATINES Share price

Shaw Wallace Gelatines Limited (SWGL) was incorporated on 13th January 1961 as Leiner-Knit Gelatin Co. Pvt. Ltd. by P. Leiner & Sons (UK) at Jabalpur Madhya Pradesh. The companyoperated a bone mill in Jabalpur. Subsequently on 3rd January1962 the company was became a Public Limited Company undersection 43A of the Companies (Amendment) Act 1960. Thus theword "Private" was deleted from the name of the company.Shaw Wallace & Company Limited alongwith its other businessinterests was also engaged in the manufacture and sale of glue.In view of the common raw material of animal origin the companyidentified gelatine as a new business opportunity with adequatesynergy. Thus the company took over the management ofLeiner-Knit Gelatin Company Limited and on 13th January 1969 thename of the company was changed to Shaw Leiner Limited.As there was not enough offtake from the domestic end-userindustry the prevailing market condition during this period wasnot very favourable. Hence the Company diversified intoproduction of glue from the year 1971. In the process of themanufacture of gelatine Ossein is the most importantintermediate. It is used in producing photographic films. In1974 the company found opportunities to export ossein toEastman Kodak (USA) and to customers in other countries. TheCompany was awarded the Capexil award for the export of osseinin 1975.In 1978 P. Leiner & Sons fully divested their shares in thecompany and there was a change in the management pattern. As aresult Shaw Wallace & Co. Ltd. with its group investmentcompanies held 89% of the total number of shares in the Company.The name of the Company was subsequently changed from ShawLeiner Limited to Shaw Wallace Gelatines Limited with effectfrom 26th September 1979.The export of ossein to Eastman Kodak and buyers in othercountries stopped in 1980 as the users developed moreeconomical and convenient sources elsewhere. Meanwhile with aperceptible change in the domestic scenario the pharmaceuticalcompanies grew at a brisk pace. Realising the marketopportunities the Company refocussed their activities ingelatine emphasising on more value added products like HardShell and Soft Shell grade gelatine for the pharmaceuticalindustry. And it was found necessary to expand the productioncapacity to achieve economies of scale. With a view to upgradethe quality of the gelatine the existing in-house research anddevelopment facilities were geared up and the modernisation ofthe plant was undertaken. This modernisation and expansioncommenced in 1985 and was successfully completed in August1988. As a result of this modernisation exercise theproduction capacity moved up from 500 tpa to 1000 tpa at a costof Rs. 4 crores. The same was funded with the assistance ofIRBI and from internal accruals.The Company also proved its dedication to Research andDevelopment by continuously innovating and discovering newprocesses and products. In 1988 SWGL developed IndustrialGelatine Protein Colloid (IGPC) as an import substitute for thedefence sector. This resulted in the Company getting theprestigious National Award for Import Substitution from theGovernment of India in 1992. In 1990 it improved its limingtechnology a major step towards rationalisation and reductionof cost. In 1991 it established the photographic gradegelatine and in 1992 it developed two new productsnamely-Haemaccell-a plasma expander used for surgical purposesand Spray-Dried Gelatine thus gaining an edge over itscompetitors. Also in 1991 it started exporting gelatine in asmall way to countries like United Kingdom Switzerland Germanyand Bangladesh.These activities led to an improvement in the performance of theCompany to a great extent. From the year 1989-90 the companywas back on a profit trail and in 1992 it managed to wipe outits accumulated losses of Rs. 7021000/-. In 1993 it declareda dividend of 30%.During the period 1989-90 to 1993-94 the turnover of the companyincreased from Rs. 1171.52 to Rs. 2774.45 lacs thus registeringa compounded annual growth rate of 24%. Similarly the profitafter tax of the company increased from Rs. 17.56 lacs to Rs. 235.24 lacs registering a compounded annual growth rate of195%. In June 1994 the company declared a dividend of 40% forthe year 1993-94 and issued a bonus of 1 equity share for everyequity share held. The earning per share after the issue ofbonus stood at Rs. 19.70.At present the company is in the process of expanding itscapacity of production from 1000 tpa to 2000 tpa in two phases.In December 1993 the company completed its first phase ofexpansion of capacity by increasing the capacity from 1000 tpato 1500 tpa. This was undertaken at a total cost of Rs. 345lacs of which Rs. 150 lacs was sourced from IRBI as term loansand the balance from internal accruals. The second phase ofexpansion is being presently undertaken and is expected to becompleted by December 1994.