The board of Orient Paper & Industries cleared the company's proposal to set up INR 1,473 crore three million tonne per annum Greenfield cement manufacturing facility at Gulburga, Karnataka. The board also approved plans to set up a 50 MW power plant entailing an additional investment of INR 247 crore.
Information trickling in suggests OPIL has already obtained the Karnataka government’s approval for the proposed project as well as its go ahead to buy some 1500 acres plus for the same. Sources close to the group indicated that the location of the proposed power plant and its use couldn't be ascertained. The greenfield Karnataka unit will, in all likelihood , be part financed by a mix of internal accruals, debt and equity.
The move to add 3 million tonne per annum cement capacity is in sync with OPIL's aim to become a 12-15 million tonne cement manufacturing firm by 2015-16 .
OPIL board also approved the issue of convertible warrants aggregating INR 1.20 crore to two promoter group companies namely Central India Industries and Shekhavati Investments and Traders at INR 57.25 a piece to raise some INR 70 crore long term capital for the venture. An extraordinary general meeting has been convened on March 7 to seek shareholders' approval for the preferential issue.
The company has been looking to build up its cement capacities for sometime now. It has recently expanded the capacity of its Andhra Pradesh and Maharashtra units, boosting its overall capacity from 3.4 million tonne per annum to 5 million tonne per annum. A 50 mw captive power plant has also been installed at Devapur (Andhra Pradesh) plant.
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