EKC setting up fourth cylinder unit in Gujarat
The Mumbai-based Everest Kanto Cylinder Ltd is currently setting up its fourth cylinder manufacturing facility in Anjar district, 12 km from Gandhidham. Construction work, which commenced last April, is likely to be completed by this October. The company has already established similar facilities in Aurangabad, Tarapur and Dubai.
The new facility is coming up on 40 acres of land and will have a capacity to manufacture 3.4 lakh cylinders per annum. The total cost of this project is estimated at Rs 105 crore. The company has already spent around Rs 30 crore from internal accruals. EKC is looking at various options to raise the balance funds. Negotiation with a bank for term loans is in progress. The company is also contemplating coming out with an IPO.
Bhimji Velji Sorathia Ltd, a local company, has been awarded the contract for civil work and Interach Building Product, Noida, is undertaking fabrication work.
The special incentive package announced by the Centre and the Gujarat government for developing industries in Kutch district prompted EKC to set up a manufacturing plant near Gandhidham. Thus, the company will avail of excise duty exemption for 5 years and sales tax exemption for 10 years.
EKC is planning to venture into new areas such as manufacturing composite cylinders for CNG vehicles, aluminium cylinders for life-saving and high-purity gases, and ultra large cylinders for storage and conveying very large quantities for gases like CNG, hydrogen etc. The company's products are used in industrial, fire fighting, medical, beverage and defence areas. In fact, EKC pioneered the manufacture of small and large sized CNG cylinders with a first mover advantage. EKC's core competence is its high-pressure seamless steel gas cylinders with a domestic market share of 90 per cent.
[11 July 2005]