Haldia Petrochemicals Ltd (HPL) has got a shot in the arm following the waiver

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of import duty on the naphtha it uses as feedstock, but a top company official today said the company will wait for the viability of its unit to be restored before making future investments.

"Although we have lined up some immediate plans, investments will be made only after restoration of the plant's viability," HPL Managing Director Partha Bhattacharya told PTI.

He said while naphtha prices had increased by 39 per cent, product prices had gone up by only 18 per cent, leaving a differential of 21 per cent.

Bhattacharya said this had put tremendous pressure on margins and the company has been making substantial monthly losses.

In the first quarter alone, the company incurred a loss of Rs 247 crore.

"We are staring at a loss of more than Rs 1,000 crore in the current fiscal," he said.

However, he said the July performance would be better, as the market was looking up.

Bhattacharya said that unless viability was restored, the company would not be able to approach banks for funds.

Commenting upon the Supermax project implemented at Haldia to increase capacity, Bhattacharya said it had badly affected the plant's viability.

"Cost and time overrun had affected the viability of the project," he said.

While the initial project cost was pegged at Rs 675 crore, the final cost arrived at Rs 1,230 crore upon its completion.

About future investment plans, he said the company intended to invest Rs 200 crore for manufacturing better-margin products which had an IRR (internal rate of return) of 35 per cent, leading to a payback period of two years.

The company also plans a total investment of Rs 4,000 crore for producing 12 to 13 grades of new polymer products.

Asked about the sales tax remission on motor spirit, for which HPL was also being denied substantial money as it was notified as an oil company, he said that positive talks have been held with the West Bengal government.