Madras Fertilisers Lines Up Rs 518cr Expansion

Madras Fertilisers Ltd (MFL), the Chennai-based public sector fertiliser giant, has embarked on an expansion-cum-modernisation project at an outlay of Rs 518.50 crore.

R Ramabadharan, chairman and managing director of MFL, said the company was increasing the production capacities of ammonia by 40 per cent from 750 metric tonnes per day (mtpd) to 1050 mtpd, urea by 66 per cent from 885 mtpd to 1475 mtpd and complex fertilisers by 55 per cent from 540,000 metric tonnes per annum (mtpa) to 840,000 mtpa.

The company would take up recommissioning of the plant in May this year, thereby extending its economic life by 15 years, Ramabadharan said adding that technical know-how and basic engineering packages for the expansion project would be supplied by Haldor Topsoe of Denmark, UTI Construction Inc of the US and Hindustan Dorr-Oliver.

 

MFL is tapping the capital market for the first time with a premium issue of 286.30 lakh shares of Rs 10 each for cash at a premium of Rs 5 each, to raise Rs 42.95 crore from the public.

The issue will open on May 12, 1997 and shares would be listed on the Chennai, Mumbai and National Stock Exchanges. Ramabadharan said that equity stake of MFL, a joint venture between the government of India and Amoco India Inc, was 69.78 per cent of the total equity of Rs 137.37 crore.

Subsequent to the public issue, the company's shareholding pattern would be reduced to 57.75 per cent by the Indian government. The company presently manufactures chemical fertilisers such as urea, biofertilisers and agrochemicals.

It achieved a turnover of Rs 686 crore and a profit after tax of Rs 21.07 crore in 1995-96, and expects a profit after tax of about Rs 11.80 crore in 1996-97.

MFL has finalised plans to set up a 400 tpd sulphuric acid plant at a cost of Rs 45 crore. The company has tied up with Hyderabad-based Fortune Biotech to promote and market its products and also participate in the equity for Rs 125 lakh.