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Nelco revamp on the cards

Reeba Zachariah in Mumbai

The Tatas are planning to restructure group company Nelco, and have roped in Tata Strategic Management Group to chart out a revamp exercise for the company. The revamp could also include a possible hiving off of businesses.

Senior Tata sources said TSMG has being given the mandate to advise Nelco on strategies that the company could embark upon to improve its performance and operations.

"The mandate also includes identifying markets and businesses for Nelco, defining growth strategies, and hiving off businesses," they said.

TSMG recently made its first presentation to Nelco, but the company was not totally satisfied with it. It has asked the Tata group's consulting arm to submit a fresh proposal, sources said.

Nelco is engaged in the business of industrial controls, power electronics, automation and telecommunications.

The company has laid greater thrust on areas of defense electronics, etc, and had been hoping to see its industrial systems business fare better.

Nelco declared a 10 per cent dividend for 2001-02, after a gap of seven years. The satellite communication company returned to the dividend list having recorded a net profit of Rs 13.4 million on sales of Rs 913.3 million for the nine months ended March 2002.

The turnaround followed the completion of a large order in the strategic electronics business, and sustained improved performance of the Tatanet division.

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