Shares of Balmrapur Chini Mills Limited traded nearly 4 percent higher to Rs 386 in early trade on February 19 after the company announced it is foraying into manufacturing polylactic acid to be used in the production of bioplastic.
The company said that the move aligns with the its commitment to environmentally conscious practices and synergises with the existing business model, contributing to a more sustainable and responsible approach to manufacturing.
At 9:20 am, the stock was trading at Rs 384, up 3.4 percent from the previous close on the NSE. In the last three months, the stock has tanked nearly 15 percent on the exchanges.
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The estimated amount that the company is planning to invest is about Rs 2,000 crore. Of the total investment, Rs 800 is expected to come through accruals, and the remaining Rs 1,200 crore through debt in phases over a period of around 2.5 years.
Polylactic Acid, also known as PLA, is a non-toxic and environmentally friendly material. The current production of PLA in the US and Thailand produces 68 percent lower greenhouse gases, consumes 65 percent less energy than the production of conventional plastics, and is toxin-free.
"The overarching goal is to transform the current linear consumption manufacturing paradigm into one grounded in circular and regenerative principles. Investment into PLA is seen as a substantial opportunity for the company to achieve growth," the company said in a filing.
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