Seshasayee Paper and Boards, India, will invest some Rs. 480 crore in its paper mills to expand raw material capacity and captive power generation, according to a report by The Hindu BusinessLine. Together with the increase in paper pulp production due to the investment, the company’s paper output capacity will increase to 2.75 lakh tpy from the current 1.9 lakh tpy spread across two mills in South Tamil Nadu.

 

The primary objective of the investment is to improve cost-competitiveness. The focus is on increasing in-house pulp production to bring down dependence on imports, and captive power generation. The company will fund about a third of the investment from internal accruals and the balance from bank loans.

 

The project cost at the Erode unit will be about Rs. 300 crore, with paper production increasing to 1.65 lakh tpy from the current 1.2 lakh tpy. In addition, hardwood pulp plant capacity will increase to 1.45 lakh tpy from 1.15 lakh tpy now and a 15-MW coal-based power plant will be added, taking the total captive capacity to 55 MW. The unit will also set up a chemical recovery island with a capacity of 630 to 950 metric tpd. The company will also modernize the bagasse pulp and waste water treatment plants.

 

Seshasayee Paper will invest Rs.180 crore at the Tirunelveli unit, where it has about 300 acres, to expand paper production to 1.10 lakh tpy from about 70,000 metric tpy currently. It will add equipment to enable production of high-end printing papers. An 18-MW coal-based power plant will be established with the current 6 MW biofuel plant treated as a standby.

 

The deinking plant will also be restarted at the Tirunelveli unit, which will enable it to recycle 1.32 lakh tpy of used paper. This unit will also use surplus pulp from Erode.