The Hindu Business Line : Visaka setting up Rs 18-cr asbestos unit

VISAKA Industries Ltd (VIL) is setting up a Rs 18-crore asbestos cement sheet unit at Tumkur in Karnataka apart from expanding the capacity of its spinning division at Nagpur at a cost of Rs 32 crore.

According to the VIL Managing Director, Mr G. Vivekanand, commercial production of the expansion project is expected to commence by October 1, while the civil works of the asbestos cement unit will begin next month. The asbestos unit is expected to be operational by September. The company's board will work out the modalities of financing the two projects.

Mr Vivekanand told newspersons here that the spinning division expansion project had the benefit of reduced import duty announced for project imports and the borrowing for this project would enjoy concessional interest rate under the Technology Upgradation Fund. As a result, the effective interest rate on the borrowings for the project would be around five per cent.

Similarly, he said that the scaling down of import duty on asbestos fibre arising from the recent announcement of reduction of peak rate of customs duty from 25 per cent to 20 per cent and abolition of special additional duty on imports would benefit the company.

The company had recorded a turnover of Rs 39.97 crore during the quarter ended December 31, 2003 against Rs 31.76 crore during the corresponding quarter of the previous year, recording a growth of 25.86 per cent.

Its net profit for the quarter has gone up from Rs 2.92 crore in the previous year to Rs 2.94 crore.