The shares of Dalmia Bharat and Birla Corporation are in focus after the two companies found themselves trapped in the scrapping of industrial policies. The government of West Bengal has stopped the incentive scheme given to the companies.
What happened?
Dalmia Cement (Bharat) Ltd, a fully owned subsidiary of Dalmia Bharat, stated that it was entitled to receive Rs 236.32 crore with 8 percent interest in view of the now-abolished ‘WB State Support for Industries Scheme 2013’. The company has a four million tonne cement plant in Paschim Midnapore, West Bengal.
Another affected company, Birla Corporation Ltd, said it was expecting Rs 55.66 crore under the Industrial Promotion Assistance (IPA), created by the West Bengal State Industrial Development Corporation (WBSIDC), along with another outstanding payment of Rs 138.58 crore.
Both companies now fear the incentive payments could be at risk, given the Revocation Act has taken away, or will take away, several benefits that were sanctioned previously. Officials of Dalmia Bharat have said they are concerned that this could devalue a prior High Court order, and they are also reportedly looking at legal avenues to protect their position.
The West Bengal government announced in March that it had revoked eight industrial incentive schemes from 1993 to 2013 respectively. According to Chief Minister Mamata Banerjee, the industrial scenario has changed too much over the past 20 years, and a significant number of older schemes are too far removed.
Financial Highlights
Dalmia Bharat reported a revenue decline of 5 percent to Rs 13,980 crores in FY25 from Rs 14,691 crores in FY24. Additionally, it reported a net profit decline of 17 percent to Rs 699 crores in FY25 from Rs 853 crore in FY24.
On the other hand, Birla Corporation reported a revenue 4.6 decline of percent to Rs 9,214 crores in FY25 from Rs 9,663 crores in FY24. Additionally, it reported a net profit decline of 30 percent to Rs 295 crores in FY25 from Rs 421 crore in FY24.
Written by Satyajeet Mukherjee
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