Everest Kanto Cylinder Ltd, a leading manufacturer of high pressure cylinders, has reported an increase of 44% in net profit at Rs 29.42 crore for the third quarter ended 31st December 2007 compared to Rs 20.38 crore in the corresponding quarter the year previous and indicated it expects to see further growth to come in the future.

Net sales during the quarter grew by 12% to Rs 125.54 crore compared to the corresponding quarter ended December 2006, while for the 9 months ended December 2007 the company reported a staggering 76% rise in net profit against Rs 45.45 crore in the corresponding period last year. Net sales rose 25% at Rs 364.59 crore, compared to Rs 291.44 crore in the corresponding period at December 2006

Discussing the growth strategy and performance of the company, Mr Prem Khurana, Chairman and Managing Director, commented, “We expect strong growth in revenue and profitability to continue as we have embarked on an aggressive expansion mode. Further, compressed natural gas (CNG) cylinder business is seeing a favourable demand and is growing at a robust rate.”

The company is expected to commence its China operations in the current (January-March ’07) quarter, planning to invest $50m in the first phase of its China operation and having already formed a separate, wholly owned subsidiary company named EKC Industries (Tianjin) Co. Ltd. The firm will have an initial capacity of 200,000 cylinders and plans to ramp up its capacity to one million cylinders in the next 3-4 years.

China currently has approximately 400 CNG stations and this is expected to reach a level of 2000 CNG stations by 2010, in order to reduce its dependence on crude oil and pollution levels in various cities.

Similarly, the automobile industry in the Middle East in Dubai and Abu Dhabi is looking at CNG as an alternate fuel and this would prove profitable for EKC, as it already has it’s presence in Dubai.