GMR plans Rs 800 cr investment

According to V Raghunathan, Managing Director, GMR Industries, the company will have a combined capacity of 14,000 tonne crushed per day (TCD) by 2009-end. On May 30 GMR started production at its first sugar mill in Haliyal which has 3,500 TCD capacity.

He said the company has also taken a semi-finished cooperative sugar factory from Karnataka government at Ramdurg on a 25-year lease which will have 2,500 TCD capacity. For the first year of operations, the company has paid Rs 6.5 crore to Karnataka government. The work on this factory is nearing completion and is expected to start sugar production during the next crushing season.

GMR has just completed the acquisition of Alagawadi Bireshwar Sugars Pvt Ltd, which holds a licence to set up and operate a 3,500 TCD sugar mill at Raibagh in Karnataka. GMR has acquired the company for Rs 17 crore, Raghunathan told Business Standard.

"The building work of this greenfield factory has just commenced and we expect this to start production by end of 2009," he said.

Recently the company announced its plans for a Rs 250 crore rights issue to part fund its projects.

GMR is also setting up a plant to produce medium density fibre board at Ramdurg in Belgaum district. This plant will have a capacity to produce 50,000 cubic metre of MDF board per annum. The factory will basically use bagasse from its sugar mills as a raw material for this factory.

The company intends to make use of the MDF board for internal consumption and also market it in the domestic market. "We will use a large portion of MDF board through our infrastructure company in the group and also market it outside. We are yet to work out the detailed marketing plan for this unit," Raghunathan said.

The company's board, which met today, approved the shifting of the company's registered office from Hyderabad to Bangalore, subject to the approval of the members and confirmation of the Company Law Board.

Raghunathan said the company decided to shift the office to Bangalore as most of the projects are currently happening in various parts of Karnataka.