SPML to raise Rs. 250 cr.

Special Correspondent

Plans special economic zone project in Puducherry

KOLKATA: Subhas Projects and Marketing Ltd (SPML), a leading EPC player, has decided to raise Rs. 250 crore of private equity from Citicorp Venture Capital, company Vice-Chairman and Managing Director, Subhash Sethi, said.

Talking to reporters here, he said this would dilute the promoters’ stake in the company from 74 per cent to 56 per cent. While Rs. 200 crore would be raised as equity (20 per cent), the balance would be through warrants convertible in 18 months. SPML will approach its shareholders with this proposal at an extraordinary meeting on July 27 and hopes to complete the deal by August. While Rs. 100 crore would go towards meeting working capital needs, Rs. 150 crore would be invested in the projects being implemented by its four subsidiaries. These companies are engaged in hydel, infrastructure, realty and manufacturing sectors. They are executing projects in partnership with the government on the build-own-operate-transfer basis.

On its own, SPML is now implementing Rs. 3,000 crore worth of projects which are set to be completed by 2009. These include rural electrification projects in West Bengal, Bihar, Jharkhand, Uttar Pradesh and Karnataka, water management projects and other infrastructure projects. It is also planning a Rs. 600 crore SEZ project in Puducherry. The 1,000 acres required for the project had already been acquired, Mr Sethi said.

Turning to financial results, he said in line with the increased investments in the infrastructure sector, the company witnessed a 120 per cent increase in net turnover which touched Rs. 808 crore in 2006-07. The net profit rose by 107 per cent touching Rs. 43.60 crore. Accordingly, the dividend was stepped up to 50 per cent from 40 per cent in 2005-06. Mr. Sethi said the company had doubled its manpower and staff costs increased from Rs. 10 crore in 2005-06 to Rs. 21 crore now.

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