TPL to invest Rs.435 crore to expand production facilities

Chennai based Tamilnadu Petroproducts Limited (TPL), a member of the Petrochemicals arm of AM International Group is embarking on wide-ranging expansion and modernisation plans, which include:

- Capacity augmentation of LAB division,
- Revamp of caustic soda facilities and
- Setting up a Propylene Recovery Unit (PRU)

Under the above plans, the LAB capacity would be increased from 120,000 TPA to 145,000 TPA at an estimated cost of about Rs. 240 crore. The project would be commissioned in about 24 months, post regulatory approvals.

For the HCD, the Company will invest Rs. 165 crore to modernise the caustic soda and chlorine unit by replacing the mono-polar membrane technology with a more advanced world-class bipolar membrane technology. On completion in about 18 months after approvals, the production capacity for Caustic Soda will go up to 250 tonnes per day from the current 150 tonnes. At the present price levels, additional revenue of about 70% is expected from the project, with improved/higher value addition.

The Propylene Recovery Unit (PRU), first of its kind in India by a private sector player in the non-refining sector would involve an outlay of about Rs. 30 crore. This will be set up in the same PO manufacturing complex, saving significant trucking and energy costs. Propylene, a bulk chemical intermediate, is the raw material for Propylene Oxide and is derived from LPG. TPL is in advanced talks with various domestic and international vendors for LPG for this project" The project, technology of which has been developed in-house by the company's R&D team of engineers and environmental scientists, will be implemented in about 12-18 months, post approvals.

In adherence to the Group philosophy of optimum leverage, a significant part of the expansion will be funded via internal resources and the remaining through other sources.

Mr. Ashwin Muthiah, Vice-Chairman, TPL & Founding Chairman, AM International said, "TPL will be the first Indian non-refining company in the private sector to build a propylene recovery unit plant. It shows our commitment to bring manufacturing efficiencies by continuous upgrading and introducing state-of-art technology solutions. It is in line with our group philosophy to maximise margins by introducing process efficiency and value additions.

Post COVID-19, in line with the government's vision of Atmanirbhar Bharat, building domestic capabilities will be a crucial goal for us. The expansion is in line with our group, AM International's vision of ensuring our manufacturing assets meet the best environmental, health and safety standards."

Mr M Ravi, Group CEO, Petrochemicals, AM International said, "The projects would make the country self-reliant in this segment by meeting the domestic demand. It is our way of ensuring that our manufacturing prowess supports the "Vocal for Local" mission."

TPL is a three-decade old Liner Alkaline Benzene (LAB) manufacturer and has facilities for production of Heavy chemicals and Propylene oxide also.

Shares of TAMILNADU PETROPRODUCTS LTD. was last trading in BSE at Rs.47.6 as compared to the previous close of Rs. 47.45. The total number of shares traded during the day was 45588 in over 356 trades.

The stock hit an intraday high of Rs. 49.8 and intraday low of 46.55. The net turnover during the day was Rs. 2173772.

Source : Equity Bulls

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