C K Birla group company Hindustan Motors (HM) has drawn up plans for restructuring of the company which was suffering from poor cash flow due to lack of vehicle sales.
"HM remains fully committed to its revival plan. Slowdown in the economy, especially in the auto sector has affected the company too. In addition, we have had operational challenges in terms of cash flow problems for the company. Under these circumstances, it is becoming extremely challenging to manage daily operations," company's MD & CEO Uttam Bose said.
Talking to reporters after the company's extended AGM in Kolkata, Bose said the company needed to restructure the business by demerging the Chennai and Uttarpara operations.
HM was also seeking strategic investors for both the units, Bose said.
During the 18-month period under review beginning April 2012 and ending September 2013, HM incurred a loss of Rs 71.20 crore (Rs 712 million) as compared to a loss of Rs 29.96 crore (Rs 299.6 million) in FY 2011-12.
The company's accumulated losses have exceeded its net worth at the completion of the extended financial year ended September 30, 2013.
HM would take necessary steps to comply with the legal requirements, Bose added.