Grasim scripts Rs 1,215 cr capex plan

Grasim Industries, the Kumar Mangalam Birla-controlled cement and viscose staple fibre (VSF) major, has charted out a Rs 1,215 crore capital expenditure plan.

Around Rs 589 crore will be invested in cement, Rs 543 crore in VSF and Rs 83 crore in other business "" spread over 2005 and 2006.

The company recently concluded the acquisition of Larsen & Toubro's 17 million tonne cement capacity for over Rs 2,000 crore.

Grasim plans to set up a 50 mw captive thermal power plants at its Jawad unit (Vikram Cement) in Madhya Pradesh and a 20 mw additional power generation unit for Rajashree Cement in Rajasthan at a total investment of Rs 277 crore.

Around Rs 232 crore would be invested in modernising existing cement plants, while planned expenditure for capacity expansion through de-bottlenecking is Rs 61 crore. The power plants will be operational by third quarter of 2007 and the company's cement capacity would stand increased to 13.7 million tonne.

Around Rs 19 crore would go in ready-mix concrete capacities. D D Rathi, group executive president and chief financial officer, said, "We have the capability to fund our expansion through internal accruals. We are not looking at expanding our debt at this juncture."

The VSF business, which has a capacity of 2.51 lakh tonne per annum, is expected to witness a capacity addition by around 54,750 tonne. A new 100 tonne a day speciality fibre production line is being set up besides debottlenecking at its Harihar unit in Karnataka and Nagda unit in Madhya Pradesh. While the VSF capacity expansion will entail an investment of Rs 376 crore, modernisation would cost Rs 147 crore.