CMC's Mumbai office may have been among India's earliest intelligent buildings and featured in several architectural publications on that strength but its corporate headquarters in Delhi, nestled between a gymnasium and a residence on Delhi's heaving Ring Road was more befitting of a small entrepreneurial establishment. Today, 20 months after Tata Sons acquired a 51 per cent stake in the company under the government's divestment programme that has, as one would expect it to have, changed. The new office of the company that was founded by the government in the late 1970s-largely to maintain computers-is in the arterial Parliament Street and it is downright swank. And the late J.R.D. Tata smiles down on Managing Director S.S. Ghosh from a framed photograph. Still, the office and the photograph are among the more superficial of the changes at CMC. Revenues, for the year ending March 31, 2003 were up 5.4 per cent as compared to the previous year and profits, 85.1 per cent. Its new privatised avatar, evidently, suits the company-as it does several others.

At the Vadodara complex of IPCL (acquired by Reliance Industries), production has increased by around 29 per cent post privatisation. And the company is pursuing a planned change management process to move towards performance-based culture.

"This is a beginning and in the short term our efforts will take forward the process of operational integration," says Mukesh Ambani, Chairman, Reliance Industries. ''Over the long term we will seek new avenues for growth and value creation.'' Elsewhere, absenteeism is down 60 per cent, and productivity up 200 percent at Paradeep Phosphates (acquired by Zuari Maroc Phosphates)-Managing Director K.K. Gupta claims the fertiliser-maker should turn profitable by 2003-04.

At Balco (acquired, under rather acrimonious circumstances by Sterlite), capacity utilisation is up to 95 per cent from 89 per cent before privatisation, the workforce has been pruned by 1,000 to a more competitive level, and an Enterprice Resource Planning package is being implemented.

The numbers don't reveal an unambiguously happy picture yet but as Bhavin R. Chheda, an analyst at Mumbai brokerage Pioneer Intermediaries points out, "the acquisitions are a way (for Sterlite) to become fully integrated, create economies of scale, and compete globally."

You won't hear any tales of enhanced productivity or higher profitability emerging from Indian Oil Corporation's acquisition of IBP, a purely defensive measure that aims to increase the height of the entry barrier for companies striving to make their presence felt in the highly lucrative market for petroleum retailing. Still, thanks to the acquisition, IOC has increased its marketshare in gasoline and motor spirits retailing by 7.4 per cent to 42.8 per cent and in diesel retailing by 9 per cent to 48 per cent. That is certain to make IOC chairman M.S. Ramachandran believe that the Rs 1,840 crore he paid for IBP was worth every rupee. ''It was a strategic acquisition,'' he says. ''And it will benefit IOC in the long run.''

Indeed, even the fickle stockmarkets recognise the merits of privatisation. At the peak of the disinvestment programme, PSU stocks shored up the market; even today, the shares of companies such as NALCO and MTNL in which the government plans to divest some of its stake soon, are holding their own in a none-too-happy market.

Not every public sector company that was privatised presents as happy a picture. There's the strange case of VSNL, where a mixture of government intervention- it still retains a 26.12 per cent stake and used that to oppose the company's investment in Tata Group stablemate Tata Teleservices, and inertia (why the company still hasn't commercially entered the domestic long distance telephony market will remain a mystery) have eroded some Rs 2,300 crore in market value. And in the latest episode, the death of an employee from heart attack on May 15 is being attributed by the company's union to a voluntary retirement scheme aimed at reducing workforce by a third that opened the same day.

Another laggard remains HTL, where current owner HFCL is awaiting a post-closure settlement of Rs 58 crore before restructuring the antiquated product line and offering a voluntary retirement scheme. Two audits later, there's no sign of that settlement; meanwhile losses have zoomed to Rs 100 crore.

If there's a moral to this numerical tale, it is that companies that acquire public sector units would do well to intervene strategically and operationally at once and work towards integrating the acquired with their existing operations. Those companies that haven't done this are seeing the returns on their investment vanish.

additional reporting Roshni Jayakar, Ashish Gupta, Nitya Varadarajan and Dipayan Baishya

CMC Business: Computer software and maintenance Divested: October 2001 Buyer: Tata Group Price: Rs 152 crore for a 51 per cent stake 2000-01 revenues Rs 552.61 crore 2000-01 Net Profit Rs 25.09 crore Staff Strength before 2,950 2002-03 revenues Rs 679.09 crore 2002-03 Net Profit Rs 36.37 crore Staff strength now 3,350* Gets to go global on the wings of TCS and through Tata ELXSI, Tata Infotech, Tata Telecom, and Tata Technologies. IPCL Business: Petrochemicals Divested: May 2002 Buyer: Reliance Industries Price: Rs 1,491 crore for a 26 per cent stake 2001-02 revenues Rs 8,524 crore 2001-02 pat Rs 107 crore Staff Strength before 13,840 2002-03 revenues Rs 9,921 crore 2002-03 pat Rs 204 crore Staff strength now 13,306 Key operational initiatives and the upturn in the petrochemicals sector could help IPCL do better. VSNL Business: Long distance telephony, internet services Divested: February 2002 Buyer: Tata Group Price: Rs 1,439 crore for a 25 per cent stake 2001-02 revenues: Rs 7111.8 crore 2001-02 pat: Rs 1,407 crore Staff Strength before: 2,750 2002-03 revenues: Rs 3,779.4 crore (9 months) 2002-03 pat: Rs 589 crore (9 months) Staff strength now: 2,700 Competition is eroding its international long-distance business and it loses captive business from BSNL and MTNL in 2004. IBP Business: Oil products marketing Divested: February 2002 Buyer: IOC Price: Rs 1,153.68 crore for a 33.58 per cent stake 2001-02 revenues: Rs 8,532.03 crore 2001-02 pat: Rs 195.79 crore) Staff Strength before: 2,730 2002-03 revenues: Rs 6,802.96 crore (9 months) 2002-03 pat: Rs 49.80 crore (9 months) Staff strength now: 2,195 IBP has served IOC well. As for its own performance, that's another issue. BALCO Business: Aluminum Divested: March 2001 Buyer: Sterlite Price: Rs 551.5 crore for a 51 per cent stake 2000-01 revenues Rs 897 crore 2001-02 pat Rs -43 crore Staff Strength before 6,436 2002-03 revenues Rs 984.3 crore 2002-03 pat Rs 6 crore Staff strength now 4,932 Planned capacity addition in smelting and power plants along with rising aluminum prices will add sheen to it. HZL Business: Zinc Divested: April 2002 Buyer: Sterlite Price: Rs 445 crore for a 26 per cent stake 2001-02 revenues Rs 1,461.92 crore 2001-02 pat Rs 67.96 crore Staff Strength before 8,143 2002-03 revenues Rs 1,727.18 crore (9 months) 2002-03 pat Rs 145.15 crore Staff strength now 6,043 Impressive show despite zinc prices hitting historic lows. Key success levers: cost control, productivity and marketing. PARADEEP PHOSPHATES Business: Fertilisers Divested: February 2002 Buyer: Zuari Maroc Price: Rs 151.70 crore for a 74 per cent stake 2001-02 revenues Rs 400 crore 2001-02 pat Rs -230 crore Staff Strength before 1,150* 2002-03 revenues Rs 815 crore 2002-03 pat Rs -60 crore Staff strength now 987* The company's marketing has improved and it is headed for a break-even by the end of the current financial year. MODERN FOODS Business: bread Divested: January 2000 Buyer: HLL Price: Rs 105.45 crore for a 74 per cent stake 1999-2000 revenues Rs 149 crore 1999-2000 PAT Rs -48 crore Staff Strength before n.a. 2002-03 revenues Rs 272 crore 2002-03 pat Rs -15.7 crore+ Staff strength now n.a. As a wholly-owned HLL subsidiary, it stands to benefit from the company's foods thrust. HTL Business: Telecom equipment Divested: October 2001 Buyer: HFCL Price: Rs 55 crore for a 74 per cent stake 2001-02 revenues Rs 250 crore 2001-02 pat Rs -70 crore Staff Strength before 1,150 2002-03 revenues Rs 250 crore 2002-03 pat Rs -100 crore Staff strength now 950 Strategic inertia could make HTL the disinvestment process' first unqualified lemon.