HPCL, GAIL to build Rs 40,000 cr petrochem project
State-owned refiner Hindustan Petroleum Corp Ltd (HPCL) and gas utility GAIL India Ltd today signed a pact with Andhra Government for setting up a Rs 40,000 crore petrochemical plant.business Updated: Jan 27, 2017 19:07 IST
State-owned refiner Hindustan Petroleum Corp Ltd (HPCL) and gas utility GAIL India Ltd today signed a pact with Andhra Government for setting up a Rs 40,000 crore petrochemical plant.
The 50:50 joint venture will set up a 1.5 million tons Ethylene Derivatives plant, which will produce a wide range of petrochemical raw materials for the manufacture of detergents, paints and coatings, cosmetics, textiles and adhesives.
GAIL was also in news as the company approved issuance of bonus shares to reward shareholders.
The Board of Directors of the company in its meeting on January 25 “recommended the issuance of one bonus share of Rs 10 for existing three equity shares of Rs 10 each fully paid up, subject to the shareholders approval”, GAIL said in a statement.
Consequently, the paid-up share capital of the company will increase from Rs 1,268.48 crore to Rs 1,691.30 crore. GAIL had last issued bonus shares of one fully paid-up bonus share for every two equity shares in October 2008.
Also, it approved payment of interim dividend for the financial year 2016-17 at the rate of 85 per cent (Rs 8.5 per equity share) on the paid-up equity share capital of the company.
The government holds 56.57 per cent of shares in GAIL and the interim dividend would give it Rs 604.94 crore. Besides it will get dividend tax.
GAIL’s Board also approved raising of funds through secured/unsecured, redeemable, non-convertible, taxable rupee bonds of up to Rs 750 crore with green shoe option up to 100 per cent of issue size aggregating up to Rs 1,500 crore on private placement basis, in one or more tranches.
“The decision has been taken in order to enhance shareholders’ value and acknowledge their support to the Company over the years,” said BC Tripathi, chairman and managing director.
The issue of the rupee bonds would help in funding the growing capex requirements for the future growth of the company, he said.
Giving details of the projects in progress, Tripathi said that work on the prestigious Jagdishpur–Haldia–Bokaro–Dhamra gas pipeline project, popularly called the Pradhan Mantri Urja Ganga, is going on in full swing and GAIL is committed to complete the project within scheduled time.
Work on the Uttar Pradesh and Bihar sections of the Urja Ganga project has made significant progress and the next phase of the project is likely to commence in the second half of 2017.
Also, the expansion of the petrochemical plant at Pata in Uttar Pradesh has stabilised. The production from subsidiary Brahmaputra Cracker & Polymer Ltd’s plant in Assam is being ramped up, he said.
GAIL is looking to capture new markets for petrochemical products and has commenced exports to China, Nepal, Bangladesh, Myanmar and Vietnam.
GAIL shares ended today’s trading at Rs 482.50, up 1.39%.