The Board has proposed a cash infusion of Rs 623 crore. The loan component of the package is Rs 443 crore which will have to be paid back to the government. The sale of surplus land at the Bangalore and Hyderabad plants are expected to raise resources for the company.
Rs 150 crore has been earmarked for technological upgrading.The company is also expected to buy technology from foreign players to develop computerised numerically controlled machines tools.
The PSU has manufacturing units at five locations. Its negative net worth stood at Rs 565 crore.
While the cash infusion is not expected to wipe off its negative net worth, the Board has recommended bailing out the PSE before it becomes sick and is referred to the Board of Industrial and Financial Reconstruction (BIFR).
