Praj Industries Board approves investment of Rs 1000 million

Praj Industries Ltd has announced that the Board of Directors of the Company at its meeting held on August 30, 2006, has approved investment upto Rs 1000 million for expansion including acquisition of an engineering Company in USA to enhance business potential in USA. Apart from that, the Company has also earmarked investments into a new R & D Centre, two manufacturing workshops nearer to the port and engineering center expansion at its base in Pune. The investment programme does not envisage raising any finance and shall be met out of the Company’s own funds. This expenditure will be carried out over a period of next 12-15 months.

Manpower in India is also being enhanced with planned addition to over 100 engineers to its existing head count.

On the business front also, the Company has been actively securing contracts in USA and Europe.

In continuation to the two US contracts for ethanol projects signed in June, the Company has been selected for supply of technology and engineering (design work) by three more Companies in the US. The value of the orders is in the region of Rs 500 million (US$ 11 million) for design work which forms the first phase of the projects.

The plants, with an annual capacity of 35 to 100 million gallons, are being installed in States of Lowa, Minnesota and, Missouri. The earlier projects are being set up in California. With this the Company will have a sound base in USA within a span of just 12-18 months.

In these contracts, the Company scored in terms of global experience, qualified manpower and innovative, cost-effective technology.

The Company has also been making in-roads into the European markets. The breakthrough in UK with the pathbreaking order from British Sugar was followed by orders from Bulgaria and Romania. The Company will be supplying technology and equipment for wheat / corn based plants. The equipment will be designed and manufactured as per CE marking required for exports to EU. Both orders were obtained amidst stiff competition from European and US Ethanol Plant suppliers. The order value is in the region of Rs 110 million.

"Praj has reiterated its position as a global provider of ethanol technology. Within just six months of entering the US market, Praj has contracted several orders from leading ethanol producers / customers. In Europe too, ethanol producers have started taking note of the Praj´s capabilities", said Pramod Chaudhari, Chairman, of the Company.

Source : Equity Bulls

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