Kolkata: ICI India is readying a Rs800-crore war chest for acquisitions and expansion in what it considers are its core business areas of paints and industrial speciality chemicals.

At the company''s 50^th annual general meeting, Rajiv Jain, managing director, said the sums accumulated by the company through steady divestments of the non-core businesses in the last few years, coupled with other reserves and prudent borrowings could amount to nearly Rs800 crore.

He indicated that the company would consider using this for acquiring businesses in India and abroad, and for expansion plans in the coming years.

Aditya Narain, chairman, ICI India said the company had gone through a number of restructuring exercises and was now poised to look forward to both organic and inorganic growth.

The areas in which the company is looking for expansion are paints and specialty chemicals. However, while in paints the company can only limit its expansion plans to within the country, with regard to speciality chemicals, "We are free to expand beyond this country," said Rajiv Jain.

Jain said ICI India was also ready to buy out the 49 per cent HLL stake in Quest International India Ltd, a joint venture, and would bring up the matter when the agreement comes up for review after another three years.

The company has been moving out of what it considers are its non-core businesses in the past few years. The businesses out of which ICI India has moved out include fertilisers, fibers, explosives, agrochemicals, pharmaceuticals and nitrocellulose, the last one ironically being a specialty chemicals business.

The rubber chemicals business continues to be a millstone around ICI India''s neck as low global prices and the higher input cost have put pressure on the margins. Sources say the company is unable to find a buyer for the business.

Jain said, "We are trying to turnaround the business before taking a decision on hiving it off. However, no timeframe has yet been fixed for continuation of such an exercise," he said.

According to Jain, ICI India has made a total provision / adjustment to the tune of Rs17.8 crore in the current fiscal to set things right for the rubber chemicals business."

According to officials ICI India''s sales growth was higher than the average industry rate and its margins were on the right track.

During the previous quarter ended June 30, 2004, sales of ICI India grew 26 per cent to Rs171 crore and the PAT was at Rs12.6 crore, up 65 per cent from the corresponding figure in the first quarter of the previous fiscal. The PAT included extraordinary income from sale of its nitrocellulose business.