Sugar firm Balrampur Chini Mills on Saturday said its board has approved a higher investment of ₹425 crore for a new distillery plant of 320 kilolitres per day (KLPD), which is expected to commence by December 2022.
The board meeting held on Saturday approved the “revised capex (capital expenditure) of ₹425 crore for the 320 KLPD distillery plant”, the company said in a regulatory filing.
Balarampur Chini said its board on November 4, 2020, had approved a ₹320-crore investment for the new plant.
“The increase in capex to the tune of ₹105 crore is mainly owing to the inclusion of 20 KLPD of extra-neutral alcohol (ENA), higher storage capacity for raw material and finished goods, sharp rise in steel prices and change in designs of equipment to bring in more efficiency and embrace automation,” it added.
The company said it plans to borrow ₹220 crore from banks under the scheme for extending financial assistance for enhancement of ethanol capacity as announced by the central government.
The balance amount will be funded through internal accruals.
“The company has already received in-principle approval from the Department of Food and Public Distribution, Government of India, confirming the eligibility for an interest subvention on said loan of ₹220 crore,” it added.
Further, Balrampur Chini said the new plant, which is expected to be commissioned by December 2022, would operate on dual fuel i.e. on sugarcane juice during the season and on grains during off season.
The plant is expected to generate an annual revenue of around ₹650 crore and has a cash payback period of less than four years, it said.
The company said higher investment would result in higher efficiency, better recovery of ethanol from juice, which will add to the bottom line (profit) and will result in better payback than the envisaged earlier.
Needless to mention that the plant will be a complete Zero Liquid Discharge plant (ZLD) equipped with incinerator boiler and turbine for cogeneration of power, it added.
Balrampur Chini is one of the largest integrated sugar companies in India. It has 10 sugar factories in Uttar Pradesh having an aggregate sugarcane crushing capacity of 76,500 tonnes per day, distillery and co-generation capacity of 360 KLPD and 163.2 megawatts (MW), respectively.