Piramal Enterprises has invested INR 256 crore in Sanghi Industries, a Kutch-based cement company with production capacity of 4.1 million tonnes a year (mtpa). The investment made through non-convertible debentures (NCD) would enable Sanghi to repay some of its debt ahead of schedule and save on interest outgo, reports a business daily.
Jayesh Desai, co-Head, Structured Investment Group, Piramal Enterprises, said that Gujarat cement demand in India is expected to increase with government spending on large infrastructure projects and higher allocation towards improving rural income. Ravi Sanghi, Chairman of Sanghi Industries, said that the funding through NCDs has opened up new opportunities and comes when demand for cement is showing signs of revival. Sanghi Industries’ production capacity accounts for about 16 per cent of Gujarat’s cement production capacity. It also plans to add another 4 mtpa on the surplus land at its existing plant. The capacity addition would be made at a competitive cost of less than US$50 per tonne, Sanghi Industries said in a statement on Thursday. The company has huge high-quality limestone reserves, captive power and port facilities. India has total cement capacity of 415 million tonnes (MT) and the utilisation level was at 70 per cent due to weak demand.
