The Hindu Business Line : Iffco posts net profit of Rs 341 cr

Indian Farmers Fertiliser Cooperative Ltd (Iffco)has notched up a sales turnover of Rs 9,953 crore and a net profit of Rs 341 crore during the fiscal 2005-06.

This has made Iffco the largest non-listed entity in the country in terms of turnover.

The company has decided to enter the infrastructure sector in a big way. An Iffco-led consortium that includes Italian Thai Development Company Ltd (ITD) of Thailand, MAEDA Corporation of Japan and ITD Cementation India Ltd has been pre-qualified to develop the Rs 2,600 crore Mumbai Trans Harbour Link Project.

A 22-km-long bridge across the deep sea connecting Sewri in Mumbai and Nhava in Navi Mumbai will be constructed under the project, the Iffco Managing Director, Mr U.S. Awasthi, said and added that the project could be awarded in 2007-08. Iffco is also setting up a 1,000 MW power generation plant in Chhattisgarh as a joint venture with the Chhattisgarh State Electricity Board (CSEB) with equity holding ratio of 74:26.

Iffco and its associates will put in Rs 1,155 crore in the joint venture company — IFFCO Chhattisgarh Power Ltd (ICPL) — while CSEB will pitch in Rs 405 crore, the Iffco Chairman, Mr S.K. Jakhar, told reporters here today. The debt-equity ratio for the Rs 5,200 crore venture is 70:30.

Fertiliser Company

In its efforts to achieve backward and forward linkages in fertiliser sector, Iffco has floated Indo-Egyptian Fertiliser Company, a joint venture with Egyptian Government's El Nasr Mining Company.

The 76:24 venture will set up a plant to produce 4.50 lakh tonnes of phosphoric acid (P2O5) annually and Iffco will buy back the entire production.

Mr Awasthi also informed that the company has switched over from naphtha to gas at its Phulpur unit that has a capacity to produce 14.18 lakh tonnes of urea per year. This switchover will result in substantial reduction in the Government subsidy bill, he said.

urea production

IFFCO has lined up plans to invest Rs 400 crore to increase its urea production capacity by 5.42 lakh tonnes, besides planning to raise about Rs 1,200 crore through external commercial borrowings (ECBs).

"We will invest Rs 400 crore this fiscal to increase our urea production capacity to 42 lakh tonnes from 37 lakh tonnes," Mr Awasthi said. The expansion for raising urea production capacity would be done at the Phulpur and Amla plants in Uttar Pradesh.

loan

Regarding the phosphoric acid plant in Paradeep that Iffco has taken over from Oswal Chemicals and Fertilisers, Mr Awasthi said the company has already taken a loan of Rs 2,000 crore from ICICI Bank for acquiring the Paradeep plant, of which about Rs 1,200 crore bridge loan would be substituted by $250 million ECB.

He said the Paradeep plant would run at 100 per cent capacity from early next year and is expected to produce 15.75 lakh tonnes fertilisers by the end of this fiscal.