Kesoram plans Rs 300-cr investment in tryre biz

By: |
Kolkata | Updated: May 26, 2016 8:10:20 AM

BK Birla Group company Kesoram Industries has firmed up plans to invest Rs 300 crore to enter the passenger car radial tyre business after it hived off Cavendish Industries, its tyre manufacturing subsiidary, to JK Tyres.

BK Birla Group company Kesoram Industries has firmed up plans to invest Rs 300 crore to enter the passenger car radial tyre business after it hived off Cavendish Industries, its tyre manufacturing subsiidary, to JK Tyres.

Kesoram’s whole-time director and chief financial officer Tridib Kumar Das said the Rs 2,195-crore deal was completed in April this year and the proceeds have mainly been utilised to retire debts.

“But we have not sold our tyre business. We have only sold our unit at Laksar in Haridwar. We will have our strong presence in the market and a part of our market requirement will be sourced from China,” Das said.

Kesoram, he said, at present has concentrated, on its truck and bus tyre manufacturing as well as two
and three wheeler tyre manufacturing at Balasore in Orissa.

It would source bus and truck radial tyres from China. The passenger car radial tyre would be manufactured at Balasore for which the company plans to invest Rs 300 crore.

However, a public interest litigation regarding pollution has come in the way of completing the facility at Balasore.

“As soon as the company gets over this we would move ahead with our investment plan,” Das said adding that the company will not have to depend much on borrowing to carry out investment.

Kesoram, which had a debt of Rs 5,200 crore and a net worth of Rs 87 crore before 31st March FY16, has an improved net worth of Rs 403 crore following the sale of Cavendish.

Get live Stock Prices from BSE and NSE and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.