Murugappa Group to inject Rs.1300 crore on business expansion during current fiscal
Chennai-based business conglomerate, Murugappa Group said it has set aside Rs.1300 crore ($325 million) in the current fiscal towards business expansion.
Business unit EID Parry, which is engaged in the production, manufacture and marketing of sugar, bio-products and ceramic sanitaryware, will get the major share (Rs.700 crore or $175 million) while a distillery unit coming up in Sivaganga will get Rs.250 crore ($62.5 million).
Out of the allocated amount, EID Parry would invest Rs.325 crore ($81.25 million) in the sugar refinery project (a joint venture (JV) with Cargill of US) coming up in Kakinada. The refinery was originally planned for a production capacity of 600,000 tonnes of sugar annually, but now th venture partners are thinking of producing 1 million tonnes annually.
An alcohol and ethanol plant as well as a 20 MW cogeneration plant coming up at Pettavaittali would require an investment of Rs.103 crore ($25.75 million).
EID Parry would also make significant investment in the area of sugar, agro-products, nutraceuticals and bio-products during the current fiscal.
According to A Vellayan, vice chairman and director (strategy), Murugappa Group, with a focus on catering to the growing power sector, business unit Carborundum Universal Limited (CUMI) would invest Rs.100 crore ($25 million) in setting up a plant that would manufacture metallised cylinders.
While the Coromandel Fertilisers Limited (CFL) would focus on expanding its retail chain stores 'Mana Gromor' by investing Rs.181 crore ($45.25 million), Tube Investments of India would invest Rs.160 crore ($40 million) on expanding a tube plant in Chennai.
The $2 billion business group would receive around 112 million by selling its 47 percent stake in JV company Parryware Roca Private Limited to Roca Group, Spain, the No.1 sanitaryware company in the world.
According to N. Srinivasan, group director (finance), the funds would be raised through a mix of debt and internal accruals.
The group, whose turnover touched Rs.9582 crore ($2.4 billion) in the fiscal year 2007-08, a year-on-year growth of 15.5 percent over 2006-07, hopes to reach a turnover target of $3.2 billion by fiscal year 2009-10.
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