Riga Sugar plans to raise Rs40cr via FCCBs

Riga Sugar Company (RSCL), the sugar outfit of Kolkata based O P Dhanuka group, is planning to tap the overseas market with Rs 40 crore foreign currency convertible bonds (FCCBs) to finance its capacity expansion plan, said an official release by the company.

The new Bihar government has announced an incentive package for establishment and expansion of sugar units. "After Uttar Pradesh, Bihar will be the new growth zone for sugar industry," said O P Dhanuka, the chairman and managing director of Riga Sugar.

The company has  a 3,500 ton crushing per day (TCD) capacity sugar mill at Sitamarhi in Bihar and is planning to expand the capacity to 5,000 TCD in the next year in order to become one of the biggest sugar mills in the state.

Besides, increasing the capacity of sugar mill, RSCL would set up an ethanol plant with a capacity of 45 kilolitre per day (KLPD) and an extra neutral alcohol (ENA) plant with a capacity of 25 (KLPD) at its distillery unit.

The expansion programme shall entail a total estimated expenditure of Rs 40 crore. This will be funded through FCCB or other overseas financial instruments which is likely to hit the market in another 2-3 months. The expansion and diversification project will be completed by 2006-07, the release said.