Kolkata's Dhunseri hikes tea capacity in FY11

Kolkata-based Dhunseri Petrochem & Tea has struck its fourth acquisition this financial year by purchasing a small-sized tea factory from Sona Assam Tea Co for an undisclosed sum that will boost core business of Dhunseri that has over the recent past expanded into new business lines viz. IT infrastructure and manufacturing of PET lines.

The capacity of the acquired factory is 7 lakh kg p.a and Dhunseri plans to expand it to 10 lakh kgs p.a. during this season, it disclosed on Thursday. With this deal, its total capacity has crossed 11 million kg a year mark and strengthens its position among the top ten tea companies in the country.

The four acquired factories in the current financial year has brought 42 lakh kg p.a. in capacity leading to over 50% increase in its existing capacity. The company has plans to expand the capacity of these four factories to 60 lakh kg p.a. this season.

Last December, it acquired Sonaguri Tea Factory earlier owned by Manas Factories Combine, Guwahati, from The Federal Bank Ltd under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interests (SARFAESI) Act in India. Three years ago, it merged Tezpur Tea with itself and gained further scale.

Besides tea, in the petrochemical/packaging segment, the company had recently given the contract for the expansion of new PET project of 2.1 lakh TPA at Haldia. This project is expected to achieve commercial production in 1st quarter of FY 2012-13. Its PET business under Aspet was created last year with amalgamation of South Asian Petrochemical Ltd with Dhunseri.

The company is also in the process of setting a new plant with a capacity of 4.2 lakh TPA in Egypt with a 70% stake with two Egyptian government entities holding the balance. Dhunseri also has an upcoming IT SEZ project coming up at Kolkata, that could further diversify its revenue stream. This is expected to be ready by January 2012.The company had consolidated revenues of Rs 1,153 crore with Rs 56 crore net profit for the year ended March'10.
 

By: Madhav Chanchani