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Indian billionaire Gautam Adani led Adani Group's company Kutch Copper Ltd. has secured funding of Rs 6,071 crores from PSU banks for setting up its copper plant in Gujarat.
Kutch Copper Ltd. (KCL) is an unlisted public company that was set up in March 2021. It is a subsidiary of Adani Enterprises Ltd. (AEL). The objective of the company, as stated by AEL, is "to undertake copper business-related activities, such as the manufacture of copper cathodes and copper rods and more."
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The company announced on Sunday that the company will be setting up a 1 MTPA (Million Tonnes Per Annum) greenfield copper refinery plant to produce refined copper in two phases. For the first phase of 0.5 MTPA, the company has managed to raise funds through a syndicated club loan.
SBI is the leader of the consortium while other lenders in the bank include Bank of Baroda, Canara Bank, EXIM Bank of India, Indian Bank, Punjab National Bank, and Bank of Maharashtra. The said consortium has sanctioned and signed an agreement for the entire debt requirement of Rs 6,071 crores.
“It will be one of the largest copper refinery complexes in the world, with benchmark ESG performance standards, leveraging state-of-the-art technology and digitalization. This financial closure enables us to accelerate the project and signifies the commitment of the Adani Group to mobilize the required resources and complete the project within the set timelines,” said Vinay Prakash, Director at AEL.
The foray into the copper business comes at a time when India has almost tripled its imports of refined copper, from 44,245 tonnes in 2017-18 to 92,290 tonnes in 2018-19. Moreover, the set up of this plant is announced a week after metal giant Vedanta announced the sale of its Thoothukudi copper plant.
The plant, when active, was said to be responsible for 40% of India's copper production. Copper is an actively traded commodity whose value has significantly declined in June 2022. It currently trades around $3.80/lb, registering a decline of 15% from the beginning of June 2022.
Article by Aman Agarwal.
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