The Hindu Business Line : Novopan plans new facility in Uttaranchal

HAVING the successful April commissioning of its new plant at Shadnagar here to more than double the capacity, Novopan Industries Ltd (NIL), the pre-laminated particle board manufacturer of the GVK Group, has chalked out further expansion.

The NIL Managing Director, Mr N. Anil Kumar Reddy, told Business Line: "We are planning to set up a modern pre-laminated particle board manufacturing facility in Uttaranchal. The idea behind expanding into Northern region is the advantages of proximity to markets and the abundant raw material in the Himalayan foothills. Of course, Uttaranchal also offers significant tax benefits."

The Uttaranchal unit, with a capacity of around 60,000 cubic metres per annum, would be commissioned by December next year. This takes the total capacity of the company to 1.85-lakh cubic metres per annum. The Patancheru unit has an annual capacity of 50,000 cubic metres, while the Shadnagar facility has 75,000 cubic metres capacity.

According to Mr Reddy, the new facility in Uttaranchal is estimated to cost around Rs 40 crore. The company proposes to fund this partly through internal accruals and the balance through institutional borrowings.

At the end of March 2005, the company's reserves stood at Rs 39.29 crore. The company has also received Rs 7.5 crore as sale proceeds of the recent divestment of its holding in the US-based subsidiary - GVK America Inc.

Thanks to availability of additional capacities, the company has recorded growth both in sales and net profit during the second quarter of current fiscal ended September 2005.

It reported net sales of Rs 18.21 crore against Rs 13.21 crore in the corresponding quarter of previous fiscal and earned a profit before tax of Rs 1.96 crore (Rs 1.55 crore) and a net profit of Rs 1.31 crore (Rs 1.13 crore).

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