Financial Daily from THE HINDU group of publications
Saturday, Aug 27, 2005
Financial Daily from THE HINDU group of publications Saturday, Aug 27, 2005 |
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Markets
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Stock Markets Corporate - New Projects Expansion plans flare up Rathi Udyog Jayanta Mallick
Kolkata , Aug. 26 RATHI Udyog has, of late, been showing enterprising growth on the stock market. The stock has posted a gain of 260.30 per cent in the last one month despite today's loss of around 10 per cent. It closed at Rs 217 on the BSE with a traded quantity of 4.06 lakh shares. According to market sources, prime reason for such an aggressive price spurt has been expansion and backward integration plans taken up by the Gaziabad-based steel products (for construction and infrastructure industry) manufacturing company. Mr Udit Rathi, CEO of the company, told Business Line that the company was expanding its Gaziabad rolling mill capacity to 1.25 lakh tpa from the present capacity of 95,000 tpa and also installing a stainless steel plant at a total cost of Rs 42 core. Mr Rathi also informed that the company has proposed a Rs 550-crore steel project in Orissa consisting of 0.5 million tonne per annum (mtpa) billets, 0.3 mtpa DRI (direct reducing iron), 0.3 mtpa pig iron and a 50-MW captive power plant, to be completed in two phases. The company has signed an MoU for iron mining right with Orissa Government and acquired 250 acres of land for the project in Sambalpur district of the State. The cost of the first phase of the project, which is to be completed by September 2006, has been estimated at Rs 220.50 crore. The company, according to the CEO, would come up with an equity issue in October next to raise around Rs 65 crore (including premium) from the market to part fund the expansion projects. The promoters, who hold around 55 per cent, are to bring in around Rs 30 crore through fresh equity investments. The balance would be funded through debts. According to market analysts, the projects are expected to enable the company to cut down on cost of raw-materials, increase the product basket and value add.
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