Kolkata-based Kanoria Chemicals & Industries Ltd is expanding the capacity of the Czech production facility of APAG Holding AG. Kanoria had acquired a 90 per cent stake in the Switzerland-headquartered company in April 2012.

APAG, through its Pardubice, Czech Republic facility, manufactures specialised electronic parts for top European automakers like Porsche, BMW, Audi and Bentley. According to N.K. Nolkha, Kanoria’s Chief Financial Officer, the capacity expansion was necessitated by APAG’s high order book position.

“Currently, we have an order book that is 150 per cent of our existing capacities,” he told Business Line .

The project, entailing an investment of approximately about €650,000 (approximately Rs 5 crore), will be completed early 2014.

Kolkata-based Kanoria had diversified into the auto-ancillary segment after selling its Renukoot-based caustic soda business to the Aditya Birla Group in April 2011 for Rs 803 crore.

APAG, which Kanoria had acquired for Rs 44 crore, reported a net profit of over Rs 9 crore on a turnover of approximately Rs 170 crore for the 15-month period ended March 2013.

Ethiopian facility

Meanwhile, Kanoria Chemicals plans to set up a $30-million (approx Rs 180 crore) export-oriented denim manufacturing facility in Ethiopia in June 2014. Of the total, $20 million will be funded through a loan.

Kanoria Africa Textiles Plc, the company’s wholly-owned subsidiary, paid advances to the Ethiopian Government for allocation of 15 hectares of land, near Addis Ababa, in April this year.

The unit will have an initial capacity to produce 12 million metres of fabric (enough to churn out nearly 24,000 pairs of jeans), every year.

According to Nolkha, the cheap hydro-electric power (priced at approximately Rs 1.50 a unit), availability of quality cotton, duty waiver on import of machinery and duty-free access to European and US markets are the primary attractions of land-locked Ethiopia.

pratim.bose@thehindu.co.in

abhishek.l@thehindu.co.in

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