Birla Cotsyn forms JV with Bhardwaj
Yash Birla's BCIL to set up a Rs 315-cr textile plant in Khamgaon in Maharashtra.
By TNN |
MUMBAI: The Yash Birla group-promoted Birla Cotsyn India (BCIL) has formed a 50:50 joint venture with the PB Bhardwaj group to set up a textile plant in Khamgaon in Maharashtra. In the first phase, the Rs 315-crore integrated textile complex will manufacture open-end, rotor-based cotton yarn with an installed capacity of 1,728 rotors. It will also have 114 looms to weave fabric.
The PB Bhardwaj group has interest in textiles and steel and has units across the world.
“In the second phase, the JV will manufacture finished clothes with an installed capacity of 50,000 metres per day by setting up a dyeing and processing unit. It will also enter into the retail of garments with its own brand,” said group chairman Yash Birla.
“The project is being funded by a mix of debt and equity in the proportion of Rs 155 crore and Rs 160 crore,” he added. The promoters’ contribution to the joint venture will be equal and any shortfall would be met from the company’s internal accruals.
The state government has conferred the mega project status to the project. This will make the JV eligible to receive incentives like an industrial promotion subsidy equivalent to the investments made. It will also be exempt from payment of stamp duty and electricity duty for the first seven years.
“The main purpose of the JV is to enable both groups to combine resources and carry on the business of manufacturing, marketing and distribution of the products. The Bhardwaj group has the experience of over two generations in textile and marketing business,” Mr Birla said. The project has been appraised by SBI Capital Markets.
The PB Bhardwaj group has interest in textiles and steel and has units across the world.
“In the second phase, the JV will manufacture finished clothes with an installed capacity of 50,000 metres per day by setting up a dyeing and processing unit. It will also enter into the retail of garments with its own brand,” said group chairman Yash Birla.
“The project is being funded by a mix of debt and equity in the proportion of Rs 155 crore and Rs 160 crore,” he added. The promoters’ contribution to the joint venture will be equal and any shortfall would be met from the company’s internal accruals.
The state government has conferred the mega project status to the project. This will make the JV eligible to receive incentives like an industrial promotion subsidy equivalent to the investments made. It will also be exempt from payment of stamp duty and electricity duty for the first seven years.
“The main purpose of the JV is to enable both groups to combine resources and carry on the business of manufacturing, marketing and distribution of the products. The Bhardwaj group has the experience of over two generations in textile and marketing business,” Mr Birla said. The project has been appraised by SBI Capital Markets.
ADVERTISEMENT
Meanwhile, Birla Power Solutions, a group company, is planning acquisitions of up to Rs 200 crore in the battery, transformer or hydro-power segments, said finance director PVR Murthy. “The acquisition would be part of a restructuring exercise that will provide scale by merging firms, selling non-core operations and spending close to Rs 1,000 crore in acquisition and expansion,” he said.Start a SIP with as low as ₹500 with ET Money App!
Download
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
ADVERTISEMENT
