Ennore Foundries plans 3 Bn expansion

Tuesday, 23 October 2007, 07:00 Hrs
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Chennai: Hinduja group company Ennore Foundries has further expansion plans, even while commencing trial production at its 2 billion, 50,000-tonne per annum (tpa) foundry unit at Sipcot Industrial Estate in Sriperumbudur, near Chennai.

The company intends to increase its castings capacity to 230,000 tpa from around 150,000 tpa at an outlay of 3 billion.

Addressing the media here Monday, Dheeraj Hinduja, President, Hinduja group, said the expansion would take place over 36 months from now.

The Ennore Foundries would meet the proposed capital expenditure by a mix of equity and debt.

According to Prabal Banerji, group president, finance and group chief financial officer, the company would first go in for private placement, followed by debt and perhaps further equity infusion.

He said the company was discussing this with a couple of private equity firms. "We will maintain a debt-to-equity ratio of 1:1," he remarked.

The Ennore Foundries is also mulling suitable foundry buys overseas. "Many foreign automobile manufacturers are putting their foundries on the block. We are looking at them as well," Hinduja said.

According to V. Mahadevan, managing director, Ennore Foundries, the company's new plant at Sriperumbudur would make cylinder blocks and heads used in automobiles.

"Forty per cent of the production from this unit will be exported," said Mahadevan.

The Ennore Foundries posted a turnover of 2.15 billion and a net profit of 877 million in the first half of the current financial year.
Source: IANS
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