The global credit crisis may cast a shadow over the greenfield projects of Hindalco Industries, the flagship company of the Aditya Birla group, as the aluminium maker is yet to conclude its debt-raising programme. The prolonged fund-raising plan is expected to delay some of the greenfield projects of the company, said informed sources.
“As Hindalco is planning to club the debt tie-up for this project with its other greenfield projects, negotiations with the banks may end up protracted, especially given the global credit scare,” said the report and it added that the management also felt that funding is a relatively "big risk" for the project than any other factors.
The global meltdown in commodity prices has put capex plans of over Rs 2 lakh crore by Indian steel and aluminium companies in jeopardy. Some big-ticket projects that were originally scheduled to go stream by 2012 are being pushed by two years.
Hindalco intends to fund its Utkal project through a debt-equity mix of 70:30. Of the equity contribution of Rs1,600 crore, the company has already infused Rs 750 crore until last December. The company has already made a commitment for additional Rs 3,000 crore, according to Hindalco website.
A spokesperson for Hindalco said, “There was a little delay in getting regulatory approvals and the projects are progressing as per schedule."
Hindalco’s other greenfield projects in the pipeline include Mahan Aluminium, Aditya Smelter & CPP, Aditya Refinery & Mines and Jharkhand Aluminium. The company executive has not disclosed the debt-raising programme of the new projects. The first metal from the Mahan smelter is expected by July 2011. Aditya Refinery is proposed to be mechanically completed by January 2013. The Jharkhand project is expected to be completed by June 2012. January 2011 is the targeted date for the mechanical completion of the Utkal plant and the first alumina is expected to be produced by July 2011.
