Date:15/06/2004 URL: http://www.thehindubusinessline.com/2004/06/15/stories/2004061502230300.htm

Back DSCL seeks $40-m IFC loan to fund expansion

Ambarish Mukherjee

New Delhi , June 14

DCM Shriram Consolidated Ltd (DSCL) has applied for a Rs 180-crore ($40 million) loan from the Washington-based International Finance Corporation (IFC) to fund its Rs 320-crore ongoing expansion plans.

According to the plans, another Rs 120 crore would be invested from internal accruals while the remaining Rs 20 crore would be domestic loans.

The DSCL Chairman and Senior Managing Director, Mr Ajay S. Shriram, said all expansion of capacities would be completed by the middle of the next financial year (2005-06).

"After the expansions are over , the company would get the benefits from the second half. Post expansion, the company's turnover is expected to reach the Rs 2,000 crore-mark," he said.

Mr Shriram said that the company has simultaneously undertaken capacity expansions for almost all its products. "While PVC capacity is being increased from 110 tonnes per day (tpd) to 175 tpd, caustic soda capacity is being increased from 130 tpd to 200 tpd. An additional 40 MW from the present 85 MW to 125 MW is also raising power-generating capacity.

The company would also be expanding its cement manufacturing capacity from 2.9 lakh tonnes to four lakh tonnes as well as undertaking marginal debottlenecking of its two sugar mills. All these should be over by the second quarter of 2005-06," Mr Shriram said.

The company is expanding its caustic soda capacity along with a shift from the present mercury-based technology to membrane-based technology. While the new membrane-based plant is sourced from Asahi Chemicals of Japan, certain portions of the old plant such as the salt storage system, brine manufacturing and purification system, the hydrochloric acid system, the caustic concentration system, chlorine bottling system and all the safety systems would be retained as they could continue to function with the new plant using a different technology, Mr Shriram said.

For the sugar business, Mr Shriram said, this year the company is only going in for debottlenecking, which would increase the total capacity by around 10 per cent from 10,000 tpd to 11,000 tpd.

"But next year we plan to undertake some expansion of our sugar mill capacities and they would be major big expansions," he said.