Phillips Carbon Black plans to expand capacity, build TN unit

Elias Hubbard
May 5, 2018

According to Goenka, the company has taken up an ambitious plan of enhancing the capacity of the company from 4.7 lakh tonne to 7 lakh tonne in the next two-three years.

PCBL Chairman Sanjiv Goenka said at a press meet that the firm would fund these programmes through a mix of debt and equity.

"We are setting up a 1.5 lakh tonne capacity carbon black greenfield plant at Ennore in Tamil Nadu at an expenditure of Rs 600 crore. Along with it, we will go for de-bottlenecking of Dahej and Palej plants at a cost of Rs 300 crore", Goenka said. PCBL now has an annual capacity of 470,000 tonnes in its four plants - Durgapur (West Bengal), Mundra (Gujarat), Palej (Gujarat) and Kochi (Kerala), which is expected to go up to 700,000 tonnes by December 2020. He argued that the southern state was being chosen by the company for the greenfield location because the state has a lot of automobile and tyre manufacturing units and carbon black is one of the main raw materials for tyre industry.

Carbon black adds stability and hardness to tyres, besides giving them the black colour. "There will be a 50 per cent increase in capacity with all the expansion", Goenka said. However, according to officials, the issue size will be between Rs 400-500 crore.

The firm on Friday said its net profit in the March quarter jumped to Rs74.25 crore from Rs28.25 crore in the same period previous year, thanks to higher sales, reduction of debt and improved operational efficiency. The long-term debt of the company is Rs 450 crore so far.

Sanjiv Goenka, chairman of RP-Sanjiv Goenka Group. These include high sales volume, operational efficiency, focus on high margin specialty products and fall in the overall debt level of the company.

The debt of the company had been reduced by Rs 430 crore during 2017-18 to Rs 770 crore as of March 2018. Revenue from operations for the quarter rose 24.4% year-on-year to Rs753 crore from Rs605.31 crore.

"We expect debt to be around ₹700 crore for the next few years especially since there will be investments towards capex".

For the full fiscal, standalone net profit saw a 228 per cent jump, year-on-year to ₹230 crore; while revenue (from ops) stood at ₹26,00 crore.

Other reports by Click Lancashire

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