Hyderabad: Fertiliser maker Coramandel International Ltd, a part of the Chennai-based Murugappa Group plans to spend around Rs500 crore in next two years to raise capacity to 4 million tonnes from the current 3.2 million tonnes.
Coramandel will set up a fertiliser plant in Bhatinda, Punjab at a cost of Rs116 crore, chairman A Vellayan said. The plant is expected to be commissioned in 18 months. Coramandel has tied up with HPCL-Mittal Energy Ltd in Bhatinda to source sulphur that goes into the making of so-called single super phosphate fertilizer.
The company is also spending Rs.350 crore on expanding the capacity of its Godavari fertiliser plant in Kakinada, Andhra Pradesh.
File photo of A.Vellayan, chairman, Murugappa Group.
As part of its de-risking strategy, Coramandel plans to increase the revenue share of non-susbidy business from the current 28% to 50% in three to four years. The non-subsidy business includes crop protection and specialty nutrients. The company recently announced the acquisition of a 73.22% stake in Sabero Organics Gujarat Ltd, which produces pesticides.
Coromandel posted a net profit decline of almost 20% to Rs 282.38 crore in the quarter ended 30 September. Revenue rose marginally to Rs.2,816.63 crore from Rs 2,796.31 crore in the same quarter of the last fiscal.
To mark the company’s golden jubilee, Coramandel announced the issue of bonus debentures to its shareholders. The company will issue one fully paid debenture of Rs 15 for every equity share held in the company.
“The issue and allotment of the bonus debentures along with the dividend distribution tax will account for (the spending of) approximately Rs 495 crore from the reserves,” the company said in a filing.
On Wednesday, Coramandel shares gained Rs 18.85, or 6.13%, to Rs 326.25 at the close of trading on the Bombay Stock Exchange. The benchmark Sensex rose 337.05 points, or 2.01%, to 17,085.34.