History of Kesoram Industries Ltd.

YEAR EVENTS 1919 - The Comp. was incorporated at Calcutta. The main objects of the Comp. is to manufacture textiles, rayon yarn, cement, spun pipes & fire bricks.

1948 - 16,00,000 No. of equity shares issued in prop. 2:1 in March.

1951 - 8,00,000 bonus equity shares of Rs 2.50 each issued in prop. 1:1 in July. Shares consolidated into Rs 15 each.

1954 - In March, 8 lakh bonus shares issued in prop. 1:1. Shares then consolidated into Rs 10 each.

1956 - 1 lakh right 2nd pref. shares offered at par. Only 10,000 shares take up. Balance offered to public.

1961 - The name of Comp. was changed to 'Kesoram Industries & Cotton Mills Limited' on August 30, & the same has further changed to 'Kesoram Industries Limited' on the 9th July, 1986.

- The plant for manufacture of transparent paper was set up at the same location at Tribeni in June. It has the capacity to manufacture 3,600 tpa of transparent paper.

1965 - The Comp. took on long lease one refractory unit at Kulti, West Bengal, for a period of five years.

1969 - The Comp. established its, first cement plant known as Kesoram Cement at Besantnagar, District Karimnagar, Andhra Pradesh. Two more cement plants were put up at the same site & the aggregate capacity of all the three cement plants is 8,26,000 tpa.

1980 - There was a loss of production of 37 days in Cement Division due to break-down in one of kilns. Cyclones with heavy rains and power crisis affected production.

1982 - The Comp. had to declare a lock-out because of labour unrest. The lock-out was lifted on 20th May, but the workmen did not return to duty as the suggestions made were not acceptable too them. After making fresh suggestions with modifications, the strike was withdrawn from 29th June. Normal working was resumed by end of July.

- The Comp. secured MRTP clearance to set up another cement unit at Sedam in Karnataka State with an annual capacity of 5 lakh tonnes.

- A new plant & equipment were being installed to improve the quality of production.

- In December, the Comp. issued 21,00,000-13.5% secured convertible debentures of Rs 100 each at par to the equity shareholders in the proportion 1 D: 5E. Rs 50 was payable on application & the balance by 30th June 1983.

- The debentureholders would be entitled to receive one equity share of Comp. at par for each debenture held on 30th September, 1983. The balance of Rs 90 per debenture would be redeemed at par in four equal instalments on the expiry of the 9th, 10th, 11th & 12th year from the date of allotment.

- Out of 21,00,000 debentures, 13,50,000 debentures were allotted to the shareholders & 3,15,000 debentures to directors, etc., employees & associates. The remaining 4,35,000 debentures were offered for public subscription.

- To augment the long term resources the Comp. issued 6,00,000 - 15% non-convertible debentures of Rs 100 each.

1983 - The Comp. has two wholly owned subsidiaries, namely Bharat General and Textile Industries Limited [BGTIs] & KCIM Investment Ltd.

- Due to competition from cheaper substitutes, the offtake of transparent paper was adversely affected. The labour trouble was amicably settled.

- KCIM Investment limited with an issued capital of 3,50,350 shares of Rs 10 each & 100-13% preference shares of Rs 100 each.

- 21,00,000 shares of Rs 10 each allotted to convertible debenture holders at par on 1st October, 1983.

1984 - Erratic & inadequate availability of wagons adversely affected cement despatches & consequently production had to be curtailed.

1985 - The Comp. made a further issue of 15% non-convertible debentures for a total value of Rs 65 crores. These debentures are redeemable on the expiry of 7 years from the date of allotment of debentures, at a premium of 5%.

- On 16th February, the workmen went on strike. The Management of Textile Section declared a partial lock-out on 17th February, & a total lock-out on 24th February. After lifting of the lock-out the Textile section resumed operations on 16th May.

- The prolonged lock-out coupled with rise in the cost of inputs, power & wages adversely affected working of Textile Division.

- The working of refractory factory suffered due to labour problems which resulted in a lock-out from 18th October. The operations could be restored only from 15th April, 1986.

- The Government agreed to derate the installed capacity of the plant from 9 lakh tonnes to 8.26 lakhs tonnes per annum until 31st March. This approval was further extended until 3rd June.

1986 - Another cement plant known as Vasavadatta Cement was commissioned by Comp. at Sedam, District Gulbarga, Karnataka with annual capacity to produce 5,00,000 tonnes of cement.

- The workers of winding division went on a strike which resulted in lock-out in certain section of mills with effect from 15th February, 1987.

- The labour problem coupled with frequent power cuts & stiff competition adversely affected the working of textile division during the year. The workers strike which commenced on 15th February, 1987 continued during 1987-88.

1987 - The shaft kiln for calcination was commissioned & the balancing equipments were installed.

- During June/July, two D.G. sets of 4 MW each were commissioned & the Comp. proposed to import one DG set of 5.4 MW.

1988 - No Production activities were undertaken due to the continued strike & lock-out. The lock-out was lifted on 15th November 1989 after reaching an amicable settlement with the workers' union. Substantial maintenance efforts were required for re-starting the machines that had remained idle for nearly 33 months.

- The working of Rayon Plant suffered due to a strike by workmen followed by a lockout for about 22 days.

- The working of spun-pipe unit was adversely affected due to unprecedented shortage of pig iron since August. The Comp. was forced to suspend production for nearly 78 days during the year.

- Due to steep rise in power tariff for H.T. consumers who were not taking power at prescribed voltage, the Comp. during the year installed & commissioned machinery & equipment for change over from 66 KV to 132 KV.

- Production was adversely affected due to closure of plant for about 38 days for major repairs & modifications & a strike by a section of workmen of unit during March 1989.

1989 - The Lock-out in the Rayon plant was lifted after reaching an agreement with the workers' union.

- In order to finance the tyres & tubes project, the company offered during February, 22,72,727-12.5% secured fully convertible debentures of Rs 110 each for a total value of Rs 25 crores.

- Out of total issue, 1,13,636 debentures were offered for the employees [including Indian working directorss]/workers of the Comp. on an equitable basis & 12,64,180 debentures were offered to the equity shareholders of Comp. as rights in the proportion of debenture for every 8 equity shares held [all were taken ups].

- The balance of 8,94,911 debentures together with the unsubscribed 1,04,721 debentures of employees' quota were offered for public subscription. Additional 1,89,627 debentures to the equity shareholders & additional 1,51,282 debentures to the Indian public allotted to retain oversubscription.

- Conversion of debentures were to take place in 3 stages as [is] a portion of Rs 35 of each debenture into 1 equity shares of Rs 10 at a premium of Rs 25 on the expiry of 6 months from the date of allotment of debentures; [iis] a portion of Rs 35 of each debenture into 1 equity share of Rs 10 at a premium of Rs 25 on the expiry of 12 months from the date of allotment of the debentures & [iiis] the remaining portion of Rs 40 into 1 equity share of Rs 10 each at a premium of Rs 30 per share between 1st April, 1991 & 1st April, 1992.

1990 - Go-slow tactics of loading labourers culminating in a strike for 11 days, power shortage, inadequate wagons supply & inferior quality of coal hindered further growth in production.

- Unprecedented hike in input costs accompanied by several bandhs in Calcutta affected production adversely & led to financial losses.

- Though productions showed marginal improvement, overall working was affected by hike in input costs & imposition of surcharge on petroleum products & on other items.

- The Comp. proposed to take up the expansion programme only after commencement of production at the Birla tyre project.

- The Comp. undertook to set up a project for manufacture of 10 lakhs nos. per annum of each of tyres & tubes at Balasore in Orissa.

- A technical collaboration agreement was signed with M/s. Pirelli, limited of U.K. a tyre manufacturing firm of Pirelli group.

- 99,844-11% pref. shares were redeemed by issue & allotment of 99,844-14% pref. shares [redeemable on 31.3.1999s]. 26,12,360 No. equity shares allotted in part conversion of 12.5% debentures. 3,00,000-14% pref. CR allotted privately to financial institutions [redeemable after 9 years from 25.1.1991s].

1991 - The Comp. proposed to manufacture basic bricks & necessary technology for same was being arranged.

- A letter of intent was received for doubling the capacity of Vasavadatta Cement from 5 lakh tonnes to 10 lakh tonnes per annum.

- 26,06,420 No. of equity shares allotted in part conversion of 12.5% debs.

1992 - The second fluidised bed boiler was installed. A lock-out was declared in the Rayon section effective 13th April, & the same was lifted on 2nd July.

- The Comp. undertook a programme of gradual conversion of its existing conventional spinning machines to lube spinning, superior production process etc. to improve productivity and quality.

- Production was affected by poor quality of coal & inadequate wagon supply, severe power cuts etc.

- During November-December, the Comp. issued 16,68,004-16% secured partly convertible debentures of Rs 280 each on rights basis in the proportion of 1 debenture: 10 equity shares held [all were taken ups].

- Another 83,400 secured partly convertible debentures were issued to the employees of Comp. [only 1,750 debentures taken ups]. Unsubscribed portion allowed to lapse.

- Part `A' of Rs 120 of each debenture was to be converted into two equity shares of Rs 10 each at a premium of Rs 50 per share at the end of six months from the date of allotment of debentures.

- Part `B' of Rs 160 of each debenture was to be redeemed at par on the expiry of eight years from the date of allotment of the debentures.

- 1,132 No. of equity shares allotted on part conversion of 12.5% debentures.

1993 - Both clinker & cement production were affected by major overhauling undertaken to one of kilns & due to sluggish demand, inadequate wagon supply, severe power cuts etc.

- In consultation with ICICI & other financial institutions, the tyre unit was given on lease for 3 years a consortium of companies in the form of partnership which has 4 companies including Kerosam. The business was being run under the name & style of `Birla Tyres'.

1994 - During the year steps were taken for expansion of Vasavadatta Cement unit by 6.86 lakhs p.a. & orders for plant & machinery were placed.

- During January-February, the Comp. offered 50,05,171-17% secured redeemable non-convertible debentures [NCDss] of Rs 100 each with a detachable warrants on rights basis in proportion 1 deb.: 4 equity share held [all were taken ups].

- Another 1,25,000 - 17% NCDs issued to UTI [all were taken ups]. Also 25,000-17% NCD issued to ICICI [all were taken ups].

- Each debenture of Rs 100 was to be redeemed at par in three instalments of Rs 33, Rs 33 & Rs 74 each on 31.12.1999, 31.12.2000 & 31.12.2001 respectively.

1995 - 5,00,000 Pref. shares issued paid up Rs 59.

1996 - The Textile Unit has received ISO 9002 Certificate from Messrs. D.N.V. Netherlands.

- The Comp. proposed to modernise its spinning section.

- 187,50,000 No. of equity shares issued through Global Depository Receipts.

1997 - Clinker production in Unit-I suffered due to fire in MCC panels.

- A letter of intent was also obtained for establishment of a sponge iron plant with a capacity of 1,50,000 tonnes per annum in Orissa.

- Kesoram Industries is highly diversified company, with business interest in cement, rayon yarn, refractories, textiles, tyres pipes etc. However, cement is the largest contributor to the turnover of Comp. with over 55 per cent share.

1998 - The lockout declared in the refractory unit in Kulti, Burdwan on March 29, due to 'persistent industrial relations problems and was lifted on August 27, 1998.

- The B K Birla-controlled Kesoram Industries Ltd proposes to take up restructuring of various divisions.

1999 - The management of Kesoram Industries Ltd, controlled by B.K. Birla group, today declared temporary suspension of work at its textile division in the city.

- The workers had resorted to an illegal strike on January 4, rendering the operations of textile division to a grinding halt.

- Kesoram Industries Ltd [KILs], have set up a joint action committee [JACs] to close in ranks & jointly tackle the situation following suspension of work at the company textile factory from January 5.

- The Comp. undertook a modernisation & capital expenditure scheme at its rayon yarn, cotton textile & cement plants. In 1995-96, it increased the capacity of carbon-di-sulphide to 3600 tpa, sodium sulphide to 187 tpa, sulphuric acid to 36,500 tpa, viscose filament rayon yarn to 6,500 tpa.

- The British Standards Institution [BSIs] has awarded an ISO 9002 quality management system certificate exclusively to the corporate office of Kesoram Industries Ltd, a B. K. Birla group outfit.

- The manufacturing units of Kesoram Industries, which include cement, tyre, rayon, spun pipe & foundries & refractories, have received the ISO certification.

- The management of Kesoram Industries limited [KILs] - a B K Birla group Comp. - has declared suspension of work at its textile unit located in Garden Reach Road, Calcutta, January 5 onwards.

- The British Standards Institution [BSIs] has awarded an ISO 9002 quality management system certificate exclusively to the corporate office of Kesoram Industries Ltd, a B. K. Birla group outfit.

2000 - Kesoram Industries limited of B.K. Birla group has proposed to delist its shares from the Delhi Stock Exchange.

- The Comp. has proposed to transfer two properties, to its wholly-owned subsidiaries - Akhileshwar Properties limited and Softshree Estates limited for real estate development.

- Kesoram Textile Mills Ltd, created last year by spinning off Kesoram Industries' textile operations, feels that it can resume operations only if workers agree to higher workloads, production-linked wages & reduction in waste.

2001 - The Comp. has proposed to merge its wholly-owned subsidiary -- Bharat General and Textiles limited with itself to enhance the net worth by around Rs 37 crore.

2002

-Raises 42 lakh shares from open market under the buyback scheme.

-FITCH gives 'Ind D1+' rating for Rs.40cr commercial paper programme of company.

-Buys 64.36 lakh shares from retail investors through buyback.

-Birla increases the stake in the Comp. by 0.91% to 23.68 % as on sept 2002.

2003

-Appoints M/s AXC Computers Pvt Ltd as the share & Transfer agents for both physical & electronic securities.

-Discontinues the scheme of buyback of its fully paid-up equity shares of Rs.10 each from open market through trading mechanism of exchange.

-Kolkota High Court approves for scheme of amalgamation of KICM Investments Ltd.

-Promoters increase their stake in the Comp. by 0.10%.

-Holdings of Private Corporate Bodies in the Comp. edges down by 12% during the last two years.

2004

-Kesoram Industries Ltd has entered into an agreement on April 3, 2004 to hive off the refractory Division of Comp. on a hire purchase basis.