The Hindu : Business : Surana’s Raichur project on schedule

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Wednesday, Jun 20, 2007
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Surana’s Raichur project on schedule

Corporate Reporter

To mobilise $25 million through FCCBs
Sponge iron plant to be on stream by March next

CHENNAI: Surana Industries, part of the Chennai based Surana group, is setting up an integrated steel complex in Raichur, Karnataka. Addressing presspersons here on Tuesday, Dinesh Surana, Managing Director, said the cost of the project was Rs. 473 crore. It has tied up with banks for term loans for Rs. 331 crore. The company will be raising $25 million (Rs. 102 crore) through foreign currency convertible bonds and the balance amount will be met from internal accruals. While it has already raised $14 million through this route, the remaining $11 million will be secured in a week, Mr. Dinesh Surana said. The FCCBs will be converted into equity shares at a price of Rs. 140 per share, he said.

According to G. R. Surana, Chairman, the Raichur plant will produce 1.28 lakh tonnes of sponge iron, 2.25 lakh tonnes of steel and two lakh tonnes of rolling mill annually. The sponge iron plant will be operational by March next year and full commercial production of alloy steel will commence by June next year.

The company is also planning to expand the capacity of its Gummidipoondi (Chennai) which produces 1.09 lakh tonnes of thermo mechanically treated bars and 30,000 tonnes of mild steel ingots annually.After successful completion of the expansion schemes in Raichur, the company also plans to raise further funds to the tune of $25 million to carry out the second phase of expansion. This will be done through qualified institutional placements (QIP), Mr. Dinesh Surana said.

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