Balrampur Chini Mills Limited has announced a strategic fundraising initiative through a preferential issue of equity shares worth up to Rs. 450 crore. The capital will support the company’s growth, including a cost revision for its Poly Lactic Acid (PLA) project and the establishment of a new Lactogypsum processing plant in Kumbhi, Uttar Pradesh. Additionally, the Board has approved the issuance of Rs. 200 crore in non-convertible debentures to further strengthen the balance sheet.
Preferential Issue for Strategic Growth
The Board of Directors at Balrampur Chini Mills has approved the issuance of up to 93,16,771 equity shares at a price of Rs. 483 per share. This preferential issue targets a mix of promoters and institutional investors, including TATA Small Cap Fund and various alternative investment funds, aiming to raise a total of approximately Rs. 450 crore. An Extra-Ordinary General Meeting is scheduled for 20th May 2026 to seek shareholder approval for this capital infusion.
Upgraded Investment in PLA Project
The company has revised the capital expenditure for its 80,000 tonnes per annum (TPA) Poly Lactic Acid (PLA) project. The estimated project cost has been adjusted from Rs. 2,850 crore to Rs. 3,080 crore. This increase of Rs. 230 crore is attributed to rising construction material costs, global supply chain disruptions, and necessary engineering design optimizations. The project remains a central pillar of the company’s diversification strategy.
New Lactogypsum Processing Facility
In a move to enhance value from its manufacturing by-products, the Board has approved the establishment of a Lactogypsum Processing Plant in Kumbhi, Uttar Pradesh. With an estimated investment of up to Rs. 160 crore, the facility will have an annual capacity of 76 lakh gypsum boards. This project is expected to improve realization through efficient by-product management and is slated to commence commercial production by December 2027.
Debt Financing Strategy
Beyond equity funding, the Board has provided enabling approval for the issuance of Listed, Secured, Non-Convertible Debentures (NCDs) on a private placement basis. The company plans to raise up to Rs. 200 crore through these instruments in one or more tranches. This debt move is intended to provide the company with financial flexibility as it executes its planned expansion projects.
Source: BSE
