Pennar setting up Rs 105cr project in Andhra

Pennar Engineered Building Systems to commence production by June 2009.

Hyderabad-based Pennar group, in association with the diversified My Home group, is setting up Pennar Engineered Building Systems Limited (PEBSL) at a cost of Rs 105 crore.

The 60,000-tonne per annum capacity project, being set up in a 28-acre site at Sadishivpet in Medak district, about 45 km from here, is expected to commence commercial production by June 2009.

Pennar will have 73 per cent stake and My Home the remaining 27 per cent holding in the new project, which will have an equity component of Rs 42 crore. The balance amount required for the project will be raised through debt as convertible debentures or term loans.

PEBSL will be engaged in the design, manufacture, supply and erection of pre-engineered steel buildings and building components catering to the requirements of, among other things, industries, warehouses, commercial centres, multi-storied buildings, aircraft hangars and sports complexes.

Pennar Industries Limited (PIL), the flagship company of Pennar group, manufactures value-added steel products for infrastructure, construction, pollution control and automotive sectors. On the other hand, My Home group is into construction, cement production and non-conventional energy sectors.

According to PEBSL director Aditya Rao, the company will be shortly finalising a techno-marketing tie-up with a leading pre-engineering company in the US. "We intend to tap the latest technology improvements and developments in this field," he said.

Pennar group chairman, Nrupender Rao, said the 3,05,000-square feet plant would be fully operational by December 2009. At full capacity utilisation, the company would have an annual turnover of Rs 500 crore. The project would provide direct employment to 550 persons in the first phase and 1,000 persons in the second phase, which would commence by 2012.

My Home group chairman J Rameshwar Rao said besides PEBSL, his group also had a 10.28 per cent holding in PIL, The PIL equity stake was acquired for Rs 43 crore.

PEBSL president, PV Rao, said the company would be entering the market with a high-end and economy product model. The higher tier model would have a 10-year leak proof warranty. The company would also set up 20 branch offices across the country.