After registering a loss in Q - 1 for the first time, Rallis has reversed the trend in Q - 2. Profits, however, are still lower than the corresponding quarter of 1999 due to extremely adverse market conditions in a depressed agro economy.

Adopting a more conservative accounting practice, Rallis has written off Rs.12.42 crores in terms of trade discounts, fertilizer subsidies and other contingent liabilities arising out of previous years. This is expected to strengthen and improve the Balance Sheet for the future.

The company is taking a number of initiatives to enhance the efficiency of its operations, which are expected to impact positively on the second half results. These include company wide measures like implementation of a rigorous cost cutting programme, rationalization of the product mix with an increased focus on high contribution items, working capital compression and improvement in networking and information systems. In addition to this, the company has undertaken a marketing thrust by focusing on introduction of new products, creation of new markets and intensification of its export efforts. On the manufacturing front, Rallis is adopting measures for enhancing capacity utilization through collaborative manufacturing.

The company expects that the implementation of these measures will enable it to continue the positive operational trend set in the second quarter and end the year with better results.