The company intends to sell the power generated to the UP State Electricity Board (UPSEB) and expects to start generation by February next year.
The Ajay Shriram-led Rs 1,100-crore DSCL has reduced its debt and swapped some high-cost debt with low-cost debt. The interest cost is expected to come down further to around eight per cent this fiscal.
DCM Shriram chairman and senior managing director Ajay Shriram told FE: We have undergone the restructuring to bring all our agri-businesses under one roof so that the synergies could be used better. It will further enable us to bring down the cost of borrowing and boost our balance sheet.
The companys interest cost has come down to Rs 17.15 crore during the first half from Rs 22.08 crore in the previous year.
The company has merged its Rs 170-crore sugar business - Ghaghra Sugar Limited with DCM Shriram Consolidated, which will help boost its financials. However, the company will also have non-agri business under the same roof.
Post-restructuring, the agri-business will be around 65 per cent and the balance will be non-agri business. The restructuring will be effective April 2003.
The co-generation power plant is being set with a capital outlay of around Rs 13 crore and will be using its existing boilers and transmission lines. The company expects to generate additional revenues of around Rs 12-14 crore next year.
After the acquisition of a sugar mill last year, our cane crushing cpacity has gone up to 10500 tonne per day. The merger of sugar business into DCM Consolidated will definitely boost our earnings and will help improve the companys overall financials, Mr Shriram added.