The Hindu Business Line : DCM Shriram to expand sugar, chlor alkali capacities

THE Rs 2,000-crore DCM Shriram Consolidated Ltd (DSCL) has approved a proposal to expand its sugar capacity from 14,000 TCD to 28,000 TCD in Uttar Pradesh and chlor-alkali capacity from 250 TPD to 310 TPD at Kota.

The company has also decided to augment the total power co-gen capacity at its sugar factories from 24 MW to 72 MW. The new sugar capacities will be completed by October 2006, the last phase of co-gen power augmentation is likely to completed by October 2007 and the chlor-alkali capacity by February 2006.

The company has identified its sugar business as a significant growth area and is hence expanding its total capacity from 11,000 TCD to 14,000 TCD at its plants inAjbapur and Rupapur by September-October this crush season. However, the company's board has approved a proposal to further enhance these capacities through brownfield and greenfield expansions to a total of 28,000 TCD from 14,000 TCD with an investment of about Rs 386 crore by October 2006. This will be accompanied with a substantial increase in co-gen power capacity from 24 MW to 72 MW including 30 MW for export of power to the State Grid.

These initiatives also include the setting up two new sugar plants of 5,500 TCD capacity each in Hardoi district and expansion of capacity at Ajbapur plant from 7,500 TCD to 10,500 TCD. The new plants, like the existing ones, will be self-sufficient with co-gen power.

In the case of chlor-alkali capacity, DSCL proposes to enhance its capacity at the Kota manufacturing complex from 250 TPD to 310 TPD. This will be achieved at a competitive cost of about Rs 24 crore, and is likely to be implemented by February 2006. According to the company, being a brownfield expansion and given the strong demand outlook and better market conditions, the initiative will have a very attractive payback period.

In March 2005, the company had completed a conversion-cum-expansion project at its Kota complex to convert its entire mercury cell based chlor-alkali production capacity of 139 TPD to 250 TPD.

These new initiatives will be funded through a combination of internal accruals and external borrowings.

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