Paper, cement next in Emami sight?

Kolkata: Close on the heels of Emami Group promoters diluting a 10 per cent stake in Emami Limited to raise up to Rs 1,230 crore, the market is abuzz with speculations that the Kolkata-headquartered diversified conglomerate may sell controlling stakes in some other group companies, including the paper business, and also sell select assets in businesses like cement to lower their debt burden of nearly Rs 2,200 crore.

However, the company management on Tuesday refuted these as “pure speculations” at this point in time. Interestingly, the promoters hold 74.9 per cent in Emami Paper Mills, which is listed on the stock exchanges. Emami Cement currently operates three manufacturing plants at Risda in Madhya Pradesh, Panagrah in West Bengal and Bhabua in Bihar, having a combined capacity of 5.6 tonne per annum. It is also in the process of setting up a cement grinding plant at Kalinganagar, Orissa.

Significantly, subsequent to the dilution of promoters’ stakes by 10 per cent on Monday, the company had said, "The promoters of Emami Group have more than an adequate pool of diverse assets of value. With a view to further reduce the debt and reap the benefits of such investments for the benefit of Emami Group, the process of identification for divestment of such assets has been initiated. The above steps are being endeavoured with a strong resolve to pare the debt of the Emami Group in 6 to 8 months time."