Ours is a company with a rich heritage of more than 150 years of engineering transformation in India. Greaves has demonstrated perseverance, resilience and the ability to respond to a crisis. One such situation was at the turn of this century, when the business was not in the best of shape. More than half its peak net worth during the four preceding years had been eroded. Interest outgo stood at an all-time high. High production and manpower costs had reduced competitiveness.
The company had symptoms of potential sickness. Greaves incurred a loss of Rs 92.61 crore in the financial year 2000/01, which was extended for 18 months.
To overcome the situation, the management decided on a two-pronged restructuring exercise, in terms of business and finance. The business restructuring exercise, which ran through the critical period of 2000 to 2004, had a two-fold objective. The first was to focus on core businesses and exit from non-core ventures (such as the tie-up with SAME Group for tractors and engines), and suspend lossmaking units such as Rajasthan Polymers & Resins Ltd and eventually sell them off. The company also sought to liquidate overseas subsidiaries, rationalise them and divest its stake in companies such as Piaggio Vehicles Pvt Ltd. The second part of the objective was to reduce operating expenses.
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