Balrampur Chini Mills Ltd announced on Thursday (April 23) the approval of a ₹160 crore lactogypsum processing plant at Kumbhi in Uttar Pradesh. According to latest reports from ETManufacturing, the proposed facility will have an installed capacity of around 76 lakh gypsum boards per annum and will utilise Lactogypsum generated as a by-product from the company's Poly Lactic Acid (PLA) manufacturing operations. The company stated that this initiative aims at value addition and improved monetisation of existing by-products. The board approved utilisation of a portion of net proceeds from the preferential issue, amounting to up to ₹160 crore, towards funding of the project. As per Finance Saathi, the expected completion is around December 2027, reflecting the company's focus on circular economy and sustainability through by-product processing.
The company has approved raising up to ₹450 crore through preferential share issuance to promoters, members of the promoter group, and investors. As per ETManufacturing, the board approved the issuance and allotment of up to 93,16,771 equity shares for cash at ₹483 apiece, aggregating up to ₹450 crore. Promoters would infuse ₹193 crore through this preferential issue of shares, with TATA Small Cap Fund, ICICI Prudential, and Alchemy also acquiring shares. Additionally, the board approved raising up to ₹200 crore through the issuance of non-convertible debentures (NCDs) on a private placement basis. According to Finance Saathi, the ₹200 crore NCD issuance will be raised via one or more tranches with a flexible structure depending on market conditions, providing the company with additional funding flexibility and helping maintain a balanced debt-equity structure. The preferential issue includes participation from key promoter participants Vivek Saraogi and Sumedha Saraogi, along with institutional investors such as Tata Small Cap Fund, ICICI Prudential funds, and several Category III AIFs.
The board has approved an upward revision in the capital expenditure for its 80,000 tonnes per annum PLA project, increasing the estimated outlay from ₹2,850 crore to ₹3,080 crore. According to ETManufacturing, the ₹230 crore cost escalation is attributed to higher prices of key construction materials, global supply chain disruptions, changes in engineering and design during the modelling review, and impact of foreign exchange fluctuations. The revised enhanced capex, including cost escalations, will be funded through the issue of equity shares on a preferential basis, debt and internal accruals. As per Finance Saathi, the company remains committed to the project, which is expected to be a key growth driver despite the increased costs. The PLA project positions Balrampur Chini as a forward-looking player in the bio-based economy, with increasing focus on sustainability and demand for eco-friendly alternatives to plastic.
Avantika Saraogi, Executive Director of Balrampur Chini Mills, stated that the decisions reflect the company's continued focus on strengthening its growth roadmap. As reported by ETManufacturing, the proposed fundraise is aimed at supporting the next phase of expansion and enabling investments in strategic initiatives such as the upcoming gypsum processing plant at Kumbhi. The upcoming plant, with a total annual capacity of 80,000 tonnes, will help create additional value from byproducts while reinforcing the company's commitment to sustainable and integrated operations. With these developments, Balrampur Chini is building a fully integrated business model including by-product processing (gypsum boards) and value addition through circular economy principles. The company has scheduled an Extra-Ordinary General Meeting (EGM) on Wednesday, May 20, 2026, to seek shareholder approval for the preferential issue and other strategic decisions. Shares of Balrampur Chini Mills Ltd closed at ₹533.00 on the NSE on April 23, declining ₹8.55 or 1.58% for the day, as reported by CNBC TV18.
