Kesoram to expand tyre, cement biz

Kesoram to expand tyre, cement biz
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First Published: Mon, May 05 2008. 11 45 PM IST
Updated: Mon, May 05 2008. 11 45 PM IST
Kolkata: The B.K. Birla group will spend Rs1,390 crore in two years to expand the cement and tyre businesses of its Kesoram Industries Ltd.
The firm would raise up to Rs500 crore by selling bonds and the rest would come from the group’s internal cash flow. “We are in talks with two-three banks, and hope to finalize the funding plan within a month-and-a-half,” said company director S.K. Parik. Kesoram will spend up to Rs840 crore to increase production capacity of its tyre business by December next year to 7.54 tonnes from 2.52 tonnes now. It will raise cement production capacity by the end of this year by 1.65 tonnes over 5.3 tonnes now by investing Rs550 crore.
A year ago, group patriarch B.K. Birla had announced his grandson Kumar Mangalam Birla would inherit Kesoram’s tyre and cement businesses. The spun pipe, heavy chemicals and rayon businesses would be carved out of Kesoram and given to B.K. Birla’s daughter Manjushree Khaitan.
“This expansion means cash generated by Kesoram over the next two years would also go into businesses to be inherited by Kumar Mangalam,” said a Birla Buildings veteran, who did not wish to be named.
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First Published: Mon, May 05 2008. 11 45 PM IST