INDIA BUSINESS WORLD - OCTOBER 21st - NOVEMBER 15th
- 2007
GREENPLY BUYS GUJARAT COS, TO SET UP HP UNIT
GREENPLY Industries has picked up controlling stake in two Gujarat-based plywood manufacturing companies, Galaxy Decor and Platinum Veneers. The board, which met in Kolkata, also cleared the company's proposal to set up a new laminate producing unit in Himachal Pradesh as well as a medium densified fibre (MDF) board production line within the premises of its existing Uttarakhand plant.
Addressing mediapersons after the board meeting, Greenply Industries joint managing director & CEO Saurabh Mittal said: "We have acquired the two companies which produce plywood and its allied products and are owned by the same promoter. The acquisition is in line with our growth strategy of acquiring assets of strategic value."
"The acquisition will enhance our presence in western India and help save logistical costs substantially. Post-acquisition, the company's plywood manufacturing capacity will stand enhanced to 21 million sq metre from 18 million sq metre now," he added. Following this, the two companies will become wholly-owned subsidiaries of Greenply Industries.
Outlining the future plans, Mr Mittal said apart from shelling out Rs 3.85 crore to acquire the two companies, Greenply Industries will also repay the liabilities subject to a maximum limit of Rs 2 crore.
Some Rs 6 crore worth of new machinery and equipment will be installed in the two units and another Rs 8 crore set aside to meet their working capital requirements, he said. Total outlay is estimated to be Rs 20 crore and will be funded by a mix of internal accruals and debts.
However, Mr Mittal said the exact invest details, for the proposed unit in Himachal an MDF line, are yet to be worked out. Presently, the company has manufacturing units in Rajasthan, Nagaland, Uttarakhand and Kolkata.
Meanwhile, Greenply Industries reported a higher net profit of Rs 11.18 crore for the second quarter (Q2) ended September 30, 2007, compared to a Rs 4.75 crore net in the corresponding quarter previous year. The profit follows a 36.22 % growth in gross sales revenue during the July-September quarter at Rs 158.88 crore (Rs 116.63 crore). While net sales during the quarter under review stood at Rs 135.63 crore from Rs 97.19 crore in the corresponding quarter previous year, other income surged to Rs 2.29 crore in the said Q2 compared to Rs 40.25 lakh the previous corresponding year. Profit before tax in the said July-September quarter was Rs 15.63 crore (Rs 5.61 crore).
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