Coromandel to spend Rs 30 crore to address Sabero's utilisation woes

CHENNAI: Coromandel International, the flagship company of the Murugappa Group, will pump in Rs 30 crore to set up an effluent treatment facility for Sabero Organics, a recently-acquired arm that is facing environmental issues.

Sabero posted a loss of Rs 10.5 crore in the fourth quarter, and its utilisation rate was just 45% on account of environmental issues. In a conference call post earnings, Coromandel’s management said the effluent treatment facility would help prop up the utilisation rate to about 75% in FY13.

Coromandel acquired Sabero last year and now has a shade less than a 75% stake. It spent over Rs 400 crore on the acquisition.

Analysts believe Sabero will be able to substantially contribute to Coromandel's kitty only from 2014.