Suzuki Motor Corporation on Monday submitted the business plan for Maruti Udyog Ltd, to enable Government to proceed with the proposed public offer in the car joint venture in the current fiscal.
"Suzuki on Monday submitted the business plan for MUL. The merchant bankers will now study it," sources involved with the divestment process in MUL said in New Delhi.
The business plan, is understood to encompass the short term and medium term strategies of the auto leader Maruti, which has a car market share of over 50 per cent and had posted a profit of about Rs 105 crore (Rs 1.05 billion) last fiscal after suffering a loss of Rs 269 crore (Rs 2.69 billion) in the previous year.
The business plan is also expected to include possible new launches as also variants of the existing models by Maruti to sustain its leadership position in the face of a near continuous decline in its market share in the last three to four years.
The submission of the business plan assumes importance as it would pave the way for drafting the prospectus for ensuing IPO through which Government would divest 25 per cent of its 45 per cent equity in the joint venture.
The public issue is the second stage of divestment in MUL where the joint venture partner SMC has agreed to give an underwriting of Rs 2300 a share as part of the agreement and government has decided to offer 25 per cent equity by March, 2003 through an IPO and the remaining is to be sold in the next financial year.
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