Comments
Bhushan Steel on Monday said it plans to raise up to Rs 700 crore by April through a rights issue to part-finance its ongoing expansion projects.
“Our board has approved raising up to Rs 700 crore through the rights issue. We intend to hit the markets in the next three months after securing all the necessary approvals,” Director (Finance) Mr Nittin Johari told PTI.
He added that the money will be utilised to part-finance the company’s expansion activities, particularly in Odisha, where it is setting up a new 3 million tonnes per annum plant. The plant is scheduled to be operational in the next fiscal.
The company, which currently has debt of about Rs 13,000 crore, also intends to retire some of it after raising the funds, the Bhushan Steel Director (Finance) said.
The company currently has a production capacity of 2.5 MTPA and it produces secondary steel products like cold-rolled sheets and galvanised coils and sheet from its three manufacturing facilities at Uttar Pradesh, Maharashtra and Odisha.
For the quarter ended December 31, 2011, it posted a marginal 1.33 per cent decline in net profit to Rs 276.62 crore from Rs 280.35 crore in the corresponding quarter of 2010-11.
However, its net sales rose by about 24 per cent to Rs 2,407.06 crore during the quarter from Rs 1,942.74 crore in the same period of FY’11.
“Profit declined largely due to depreciation and higher payouts on interest during the October-December quarter,” Mr Johari said.
According the company’s filing to the BSE, its expenditure on depreciation of assets was Rs 151.62 crore, a rise of over 165 per cent, while its interest outgo was over 124 per cent higher at Rs 229.04 crore during the quarter.
In November, 2011, it had announced the settlement of a nine-year-old family dispute, following which Bhushan Steel was to be owned and controlled by Mr Brij Bhushan Singhal and his younger son Mr Neeraj, while ownership of Bhushan Power and Steel was given to Mr Sanjay, the elder son of the senior Singhal.
Shares of the company were being quoted at Rs 340.10 apiece on the BSE during late afternoon trade, down 2.87 per cent from their previous close.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.