The Hindu Business Line : Kothari Sugars to hive off chemicals business unit

Effectively, this makes the company an exclusively sugar and sugar by-products based company, with a sugar mill, distillery, and a cogeneration plant.

According to information provided by the company to the stock exchange, its board has decided to hive off the chemical business unit, which is a polybutene plant that depends on CPCL for its feedstock.

The market for the product has been volatile and imports have been a major concern.

Kothari Sugars has, over the last two years, sold off its businesses in nitroaromatics and nitric acid. The nitroaromatics plant at Karaikal in Pondicherry was sold to Chemplast Sanmar and the nitric acid plant at Sangareddy in Andhra Pradesh to EMMENNAR Biotech Pvt Ltd, Hyderabad.

With the hiving off of the Manali plant, Kothari Sugars is expected to focus on its sugar and allied businesses, for which the company has announced major expansion plans.

The Chairman and Managing Director, Mr B.H. Kothari, told shareholders at the AGM in September that the company was optimistic on the outlook for the sugar business and that it was looking at a major expansion plan.

Kothari Sugars now has a mill with a capacity to crush 2,900 tonnes sugarcane a day, a 9,000 kilolitres distillery with facility to produce ethanol and a cogeneration plant. The sugar mill has been working to more than 100 per cent capacity.

The company has announced plans to expand the sugar division with an additional sugar mills. According to sources in the know, the expansion is likely to double its sugarcane milling capacity.

It may be recalled that Kothari Sugars is going through a recovery phase after being declared a sick company in 1999-2000. The company is implementing a rehabilitation package sanctioned by the Appellate Authority for Industrial and Financial Reconstruction in an order passed in June 2004.