Cabinet clears revival package for Scooters India Ltd
New Delhi: The Cabinet on Thursday approved the Rs 200-crore revival package for ailing public sector unit (PSU) Scooters India Ltd (SIL).
"The Cabinet today cleared the proposal to revive Scooters India," sources said.
After the government shelved plan to sell out its entire stake in SIL, the Department of Heavy Industry had proposed a revival package of more than Rs 200 crore for revival of the company, they said.
Besides, the department had consulted the Board for Reconstruction of Public Sector Enterprises (BRPSE) which examined the case and later suggested a revival package for the sick unit.
In 2011, the Cabinet had given approval to divesting government's entire 95.38 percent stake in Scooters India to a private player through strategic route.
But the Department of Heavy Industry had put on hold the strategic sale of ailing public-sector unit SIL.
The automobile company, which has about 1,200 regular employees, has been incurring losses since 2002-03. In March 2009, the company was declared sick.
Incorporated in 1972, SIL initially manufactured scooters under the brand name Vijai Super for the domestic market and Lambretta for overseas markets.
Later, it ventured into the three-wheeler segment with the Vikram brand. In 1997, it stopped two-wheeler production and is now engaged in the manufacture and marketing of only three-wheelers.
SIL's net loss (before tax) stood at about Rs 20 crore during the 2011-12 fiscal.
Shares of Scooters India Ltd today traded at Rs 36.55, up 4.88 percent in the afternoon session on the BSE compared to the previous day.