There is cost-cutting in the RPG Group as it surfs the slowdown, but there is no dearth of cash for planned expansions. “We are in a spending mode. Whatever projects we had embarked on are progressing and we have sufficient funds to meet the commitments,” said Group chairman Harsh Goenka.
Power generator and distributor CESC is in the process of investing Rs 2,600 crore to set up a 600 MW power plant at Haldia, set to be operational by 2012, for which coal linkages and environmental clearances have been obtained. This company has almost completed investment of Rs 1,200 crore for a 250 MW power plant, the 3rd unit at Budge Budge in Kolkota.
Besides these, the group has signed agreements with the governments of Jharkhand and Orissa to set up two 10,000 MW power plants based on coal. “Our growth plans go much beyond West Bengal. It is aggressive, but cautious where excessive risk or excessive gearing is concerned,” said Sumantra Banerjee, managing director, CESC Ltd.
Similarly, RPG group’s tyre company Ceat is investing Rs 700 crore to set up a factory at Halol in Gujarat to produce a whole range of radial tyres. This factory to be built in phases would start operations by the end of 2010 and would employ over 1,000 people. “We see this (slowdown) as an opportunity because our project cost will be comparatively reasonable,” said Arnab Banerjee, vice-president, marketing at Ceat.
The group’s retail chain Spencer’s is also going ahead with planned expansions despite closing down loss-making stores. “We will invest around Rs 200 crore in expanding the business under Spencer’s, said Goenka. The group would soon start rolling out a chain of fast casual dining and bakery cafes across India.
Source: Hindustan Times