The Hindu : Business : Sarda group may set up unit in T.N.

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Saturday, Feb 02, 2008
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Sarda group may set up unit in T.N.

Special Correspondent

Joint venture or an assured buy-back arrangement will be preferred

Needs 50 acres to set up the project
Plans to open a mill in Rajasthan

KOLKATA: The Sarda Group, one of the largest players in the jute industry, has received feelers from the Tamil Nadu Government for setting up a jute mill in the State.

Group Chairman, G. S. Sarda, told The Hindu that he would need 50 acres for this project. The investment on the jute mill would be about Rs. 100 crore, he said.

Earlier, addressing a press conference, he said Tamil Nadu was one of the few States which had a subsidised rice distribution scheme under which the government purchased rice from farmers through the Tamil Nadu Civil Supplies Corporation. The jute bags required for this is purchased directly by the government and is valued at an annual Rs. 100 crore. The Tamil Nadu Sugar Federation also has large requirement of jute bags. He said a joint venture or an assured buy-back arrangement would be preferred, setting up such a unit will create a sizable employment opportunity.

The Sarda group has recently decided to acquire a closed jute mill in Kanpur belonging to the JK Group. This acquisition would be made by purchasing the controlling interest from the JK group at a price of Rs. 6.25 per share in terms of a SEBI order. A total investment of Rs. 55 crore would be made on this acquisition, Mr. Sarda said, adding that this included the share purchase, paying off liabilities and a Rs. 20 crore investment in reviving the unit. The mill has enormous real estate value as it is situated in the heart of the city on 8.73 acres.

Mr. Sarda said by reopening the JK jute mill fast, the current season of kharif and rabi crop could be tapped. The group now has eight units in West Bengal and Andhra Pradesh and is planning to open a mill in Rajasthan.

He said the initiative launched to train workers for employment at the group’s jute mills had taken off with the opening of the first training centre in West Bengal. He said while the industry was witnessing over-employment there was lack of properly skilled workers who could help the industry improve its productivity and enhance its competitiveness at a time when there was growing demand for jute products both in the domestic and international markets.

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