Hargoan distillery capacity to be increased
Kolkata, Oct. 5
Edelweiss, the leading investment banker, is helping Oudh Sugar Mills Ltd, the flagship sugar company of the K.K. Birla Group, to raise Rs 100 crore of foreign capital.
The company will be utilising this money for increasing the capacity of distillery located at Hargoan in Uttar Pradesh by 100 kilo litres per day to 135 kilo litres per day. The estimated cost of the project is around Rs 100 crore.
According to a senior official of the company, Oudh Sugar is concentrating on ethanol production to meet its growing demands in the petroleum sector. "The capacity of the distillery will be almost trebled," the official said.
The company will soon seek the shareholders approval for raising this capital at a meeting on November 6. After the clearance, the official said, it will take around two months to complete the whole process.
In a notice sent to the stock exchanges, Oudh Sugar stated that the fund would be raised either through global depository receipts or American depository receipts or foreign currency convertible bonds or equity shares under the qualified institutional placement guidelines (QIP).
"In all probability the money will be raised through the QIP instrument," the official added.
For the year ended June 30, Oudh Sugar recorded a net profit of Rs 45.36 crore on a gross turnover of Rs 528.64 crore. The company is setting up a greenfield unit in Uttar Pradesh with a 700 tonnes crushed per day capacity.
The unit will have a 17-MW co-generation power plant and the cost of the total project is pegged at Rs 336 crore.