UPDATE 1-Emco banks on cost efficiencies in tough times

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MUMBAI, July 22 (Reuters) - Power equipment maker Emco Ltd (EMCO.BO: Quote, Profile, Research) hopes to tide over the difficult economic environment through better cost efficiencies and improved capacity utilisation, its chief said on Tuesday.

"Interest rates and the way it will move is not something we have control over nor can we predict it. So we have to focus on our manufacturing efficiencies," Chairman and Managing Director Rajesh Jain told Reuters.

Last quarter the company's cost of funds was at 10 percent. "Yes we are facing pressure on that front but we hope to compensate for that through other measures," Jain said.

Enquiries in the transmission and distribution sector were coming in as usual, and as yet, there were no signs of a slowdown, he said.

The company ended the quarter with an outstanding order book of 13.22 billion rupees, up from 11 billion rupees at the beginning of the quarter.

About 55 percent of the orders were for transformers and 35 percent from the projects division, he said.

The company was geared to make better utilisation of its expanded manufacturing capacity and available resources to meet its earnings forecast for the year, he added.

This year it expects margins on earnings before interest, depreciation, taxes and amortisation at 13.5 percent against 12.4 percent last year.