Financial Daily from THE HINDU group of publications
Friday, Sep 09, 2005
Financial Daily from THE HINDU group of publications Friday, Sep 09, 2005 |
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Corporate
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New Projects Agro Dutch plans Rs 87-cr expansion
Kohinoor Mandal
Kolkata , Sept. 8 THE Chandigarh-based Rs 177-crore Agro Dutch Industries Ltd, a food processing company and a major mushroom producer, has worked out term loans from domestic banks and an overseas financial institutions. The Germany-based DEG has decided to give a euro-5-million (Rs 26 crore) term-loan to the company. On the domestic front, UTI Bank and Federal Bank have decided to give loans of Rs 10 crore and Rs 20 crore respectively. In fact, the company has sought the shareholders' approval to borrow up to Rs 400 crore against its existing paid-up capital of Rs 14.78 crore. According to the directors' report in the latest annual report of the company, Agro Dutch has planned major capacity expansion programme, including diversification into the business of empty cans. "For the past two years, the company has been test marketing empty cans to other users and the response has encouraged the company to expand the can manufacturing facility with a new unit including the manufacture of easy open ends," the report said. Agro Dutch is also setting up a plant for individual quick freezing of mushrooms. It has decided to develop certain other vegetables for freezing through the contract-farming route. Moreover, to achieve further economies of scale, the company has decided to increase its mushroom-growing capacity to 50,000 tonnes per annum. The company claimed that once this capacity was achieved it would become the world's largest integrated mushroom producer. According to the directors' report, the total cost of the expansion programme is Rs 86.95 crore which would be funded by the DEG loan (Rs 26 crore), internal accruals (Rs 10 crore) and another rupee term-loan from UTI Bank worth Rs 14 crore. Agro Dutch has also proposed a rights issue worth Rs 36.95 crore. For the year ended March 31, the company recorded a turnover of Rs 176.98 crore against Rs 145.22 crore in the previous financial year. While the profit before tax increased marginally to Rs 18.84 crore from Rs 18.64 crore, the net profit dropped to Rs 11.89 crore from Rs 13.01 crore.
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