The Hindu Business Line : Ennore Foundries to invest Rs 350 cr for expansion

Chennai, Feb. 7 The city-based Ennore Foundries Ltd (EFL), part of Hinduja Group, will be doubling its capacity to 2,20,000 tonnes per year by 2010-11.

Addressing newspersons at upcoming greenfield plant at Sriperumbudur, the Managing Director of Ennore Foundries, Mr V. Mahadevan, said the company would be investing Rs 350 crore during the next two years to double the capacity. Towards this, the company would be going in for GDR issue for Rs 100 crore and the rest would be managed through a combination of debt, equity and internal accruals.

At present, the promoters, including Ashok Leyland, hold about 81 per cent and based on the SEBI guidelines it would be brought down to 75 per cent.

Of the Rs 350-crore, the company would be spending Rs 150 crore at its Hyderabad unit to increase the capacity from 36,000 tonnes to 84,000 tonnes, Mr Mahadevan said.

The company had allocated Rs 200 crore for Sriperumbudur plant. This would be for creating low pressure die-cast plant (Rs 120 crore), machining facility (Rs 50 crore) and core manufacturing facility (Rs 30 crore).

The existing unit was created at a cost of Rs 170 crore with an installed capacity of 50,000 tonnes and low pressure die cast plant would add another 22,000 tonnes, he added.

In addition to creating the Sriperumbudur plant, the company had also spent Rs 37 crore and Rs 8 crore towards revamping of Ennore and Hyderabad facilities, respectively, during the last couple of years.

Mr Mahadevan feels that the industry is set to grow, thanks mainly because of emerging opportunities from the automotive industry (mainly, the powertrain manufacturers) and engines for industrial, marine and captive power applications.

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