Phillips Carbon Black to set up plant in Tamil Nadu

RP-Sanjiv-GoenkaRP-Sanjiv Goenka Group heavy engineering outfit Phillips Carbon Black (PCBL) is setting up a greenfield manufacturing unit near Ennore in Tamil Nadu with an investment of Rs 600 crore. The chairman of the group, Sanjiv Goenka, told reporters here that the capacity of the TN unit would be 1.5 lakh tonne and the unit would be operational by 2020.

He argued that the southern state was being chosen by the company for the greenfield location because the state has a lot of automobile and tyre manufacturing units and carbon black is one of the main raw materials for tyre industry.

According to Goenka, the company has taken up an ambitious plan of enhancing the capacity of the company from 4.7 lakh tonne to 7 lakh tonne in the next two-three years. Besides TN, PCBL is expanding capacity at Mumdra and Palej plants by 50,000 tonne and 30,000 tonne respectively. The investment in these two expansions would be Rs 300 crore taking total investment amount to Rs 900 crore.

“This will be funded by a combination of internal accruals and fresh equity,” he added. However, Goenka did not disclose the details of equity infusion.

Meanwhile, the carbon black-cum-power major has reported a 174% jump in net profit in the fourth quarter of 2017-18 to Rs 74 crore from Rs 27 crore in the year-ago period. The profit before tax (PBT) for the quarter was Rs 88 crore as the sales volume grew by 5% during the period.

Goenka pointed out that the robust growth in profit is largely due to higher market share, increase in production of speciality carbon black, debt restructuring and better efficiency. He added that it has reduced debt significantly from Rs 1,250 crore in 2016-17 to Rs 770 crore in the 2017-18 and planned to reduce debt further. “Our goal is to become a company free of any long-term debt within a few years,” he added. The long-term debt of the company is Rs 450 crore so far.