Financial Daily from THE HINDU group of publications
Thursday, Nov 25, 2004
E.I.D. Parry to set up sanitaryware unit, integrated sugar complex
Chennai , Nov. 24
E.I.D. Parry Ltd, part of the Murugappa group, will invest over Rs 200 crore to set up a sanitaryware facility in south India and an integrated sugar complex at its sugar mill in Pudukkottai, Tamil Nadu.
The company has informed the stock exchanges of the decision to set up a 12,000 tonne sanitary ware plant and to establish an integrated complex at the Pudukkottai sugar mill.
According to company officials, the sanitary ware project is likely to come up in Tamil Nadu at a cost of about Rs 58 crore.
The balance is for an integrated sugar complex at its Pudukkottai sugar mill, which has a capacity to crush 2,500 tonnes sugarcane a day. This involves setting up an 18 MW cogeneration facility and expanding the sugarcane crushing capacity to about 3,000 tonnes a day.
The integrated complex will involve investments of Rs 90 crore.
In addition, the company plans to set up a distillery here once statutory approvals are obtained.
E.I.D. Parry is also setting up a 22 MW cogeneration facility at its Pugalur sugar mill at a cost of Rs 55 crore.
According to officials, a part of the funding will be generated internally, thanks to the sale proceeds of its confectionery unit and other small businesses. E.I.D. Parry can spare Rs 60 crore with the balance raised as debt, they said.
Officials said that the possible sources include IFC, which has evinced interest in the projects, the Asian Development Bank and the Sugar Development Fund. Since the cogeneration facility will use bagasse, the company can tap specific lines of credit available to `green projects.'
Integrated sugar complexes are what the company is looking at as a long-term strategy. This means that the sugar mill complex is equipped to extract an entire range of the products, apart from sugar, from the primary raw material - sugarcane. This includes using bagasse, which is the sugarcane fibre, as fuel to fire the cogeneration plant, and molasses, a by-product, is used in the distillery to make alcohol and other downstream products.
The Pudukkottai sugar mill will be the second of such integrated complexes with the first being its Nellikuppam mill where it has a 24 MW cogeneration unit, a distillery and a refinery to make value added sugar products.
On the sanitary ware project, the officials said that the new project would add 12,000 tonnes to the existing output of Parryware brand. It would cater to South India.
The total production capacity under the Parryware brand would go up to 36,000 tonnes. The company has two facilities - a 12,900 tonne unit at Alwar, Rajasthan, and a 12,600 tonne unit at Ranipet, Tamil Nadu - producing the Parryware range. Thus the brand will span the entire country.
E.I.D. Parry has another unit at Dewars, Madhya Pradesh, which produces about 9,500 tonnes of sanitary ware under the Johnson Pedder brand.
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