The Hindu Business Line : Rama Newsprint sets timeline for expansion

Kolkata March 20 Rama Newsprint and Papers Ltd (RNPL) has set a target to complete its ongoing Rs 650-crore expansion plan by middle of 2009, thereby, maintaining its position as the number one domestic newsprint producer in the country. Commercial production from the expanded capacity is expected to begin from around the same time.

Confirming this to Business Line, the Vice-Chairman of the company, Mr Virendra Bangur, said that a composite set of second-hand paper making machine with an annual production capacity of about two lakh tonnes has been selected in Europe from among various international offers.

Second-hand machine

Although the machine is a second-hand one, it is completely refurbished so that it can produce quality newsprint as comparable to imported varieties, claimed Mr Bangur.

RNPL, in which the Kolkata-based S.K. Bangur Group controls about 37 per cent of the total equity share and has voting right of another about 18 per cent of equity, has finalised about Rs 530-crore of debt.

The debt has been fully under-written by UTI Bank and Canara Bank, while the process has been initiated to finalise equity portion of the expansion plan.

Face value

It may be noted that the company has recently reduced the face value of its share from Rs 10 to Rs 5 per share. Accordingly, its paid-up equity capital base was reduced from Rs 128 crore to Rs 58 crore. But, the equity capital base stands to be restructured again with the proposed infusion of about Rs 100 crore in equity.

Mr Bangur said that RNPL's annual production was about 80,000 tonnes against the installed capacity of about 1.2 tonnes of newsprint when the controlling equity stake was acquired by the Bangur Group in October, 2003.

Output

The production began to increase with the infusion of about Rs 100 crore for revamping machine and other equipment in the mill. The production touched at about 1.35 lakh tonnes in 2005-06 and about 1.35 lakh tonnes in 2006-07, while the turnover increased from about Rs 320 crore in 2005-06 to about Rs 350 crore in 2006-07. He indicated that the turnover was expected to maintain its trend.

He said that the new newsprint machine with "swinging facility" was being set up within the existing mill at Surat in Gujarat.

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