Kesoram lines up Rs 840 cr for Uttarakhand

The plan includes a radial tyre plant with 100 tonnes-a-day capacity at a capital expenditure of Rs 495 crore and another bias tyre plant for trucks with farm sector equipment having a capacity of 125 tonnes a day and involving an investment of Rs 345 crore.

SK Parikh, director, Kesoram Industries, said the expansion would be completed by December 2009. He said that discussions with bankers had been going on for a while and the company would raise around Rs 500 crore through bonds that would be underwritten by the banks.

Kesoram is already in the process of setting up a greenfield project for bias tyres in Uttarakhand at an investment of Rs 750 crore. The plant will have a capacity of 257 tonnes a day.

Parikh said the first phase of commercial production was expected to go onstream by mid-May 2008 and the last phase by December 2009.

After December 2009, taking the expansion at Uttaranchal into account, Kesoram's total tyres capacity would be 734 tonnes a day.

Kesoram is also implementing a Rs 550-crore expansion plan at its cement units. The company will increase the capacity of its Vasavadatta plant in Karnataka to 5.7 million tonnes, thereby taking its total cement capacity to 7 million tonnes. The additional capacity would go onstream by December, Parikh said.

Kesoram Industries has two cement units, Vasavadatta Cement at Sedam, Karnataka, and Kesoram Cement at Basantnagar, Andhra Pradesh.

With the expansion, Kesoram would account for five per cent of the total cement capacity in India.