The company was forced to close down its operation in 2017 and was held with National Company Law Board (NCLT), which is a quasi-judicial body that adjudicate issues with the Indian companies. In an attempt to revive the company, GRL found new promotors in the first quarter of 2020. “We have bought all the three Ludhiana based sites as part of the deal in the first half of March,” informed BB Gupta, director of the revived GRL. On asking about the size of the deal, Gupta decline to share the financial details of the transaction. It has been informed that the debt amounted to more than € 23.4 million, leading to the closure of GRL.
“We will commence production next month,” confirmed Gupta. “We will start production with 25,000 tyres/tubes each day initially and hike the production level gradually.” GRL has the capacity to produce over 3 million bicycle tyres and 3 million tubes each month. At the peak, GRL has annual turnover of about € 46 million. The new management retained the marketing team and is keen on catering the clientele in India and the overseas market. New Delhi based management comprises of three partners with two held the 45% share each, while the one is a minor partner holding the rest 10% equity.
According to reports, the new promoters are in the rubber raw material import, tyre production & real estate business from last 25 years. When asked, if it is a right move to expand in the challenging times, “We are aware of the business and our long association as well as involvement in the rubber industry will turn out to be handy.”
Founded in 1964, Govind Rubber Limited (GRL) was producing range of bicycle tyres. The company listed on Bombay Stock Exchange since 1986 and now the new management will apply for its delisting. In order to expand the business of tyres and tubes across Europe the former owners have planned to set up a wholly-owned subsidiary of Govind Rubber Limited in Netherlands.