To focus on engineering, cement sectors
Chennai-based KCP Ltd has decided to exit the biotech business to concentrate on its core areas of engineering and cement businesses.
A decision to this effect was taken at a meeting of the company’s board on Friday.
In an announcement on the NSE, the company said, “The board has approved a proposal to sell, transfer or otherwise dispose of the biotech unit at Genome Valley, Turkapally, Alexandria Knowledge Park, Shameerpet, R.R. District, Andhra Pradesh.”
It will seek shareholders consent through a postal ballot.
According to company officials, the division has not been able to achieve full capacity or economies of scale in recent years. The company has decided to exit the business involving extraction of flavours and colours from chillies and turmeric.
Effectively, the assets include about five acres and machinery with a capacity of about 100 tonnes a year. The plant has been operating only at 55-60 per cent capacity.
Before being merged a few years back, the division was a wholly-owned subsidiary of KCP Biotech. It is debt-free, the official said.
The Rs 700-crore company will focus on its core businesses, including engineering and cement production. Last year, the cement plant was expanded to 1.52 million tonnes from an annual production capacity of about 660,000 tonnes previously.
The company also announced that it has declared a pro-rata interim dividend on two crore, 12 per cent redeemable, cumulative, non-convertible preference shares of Rs 10 each held by Tata Capital Financial Services Ltd from April 1 to December 8.