International Finance Corporation (IFC), the private-sector investment arm of the World Bank, is planning to invest up to $60 million (around Rs 418 crore at the current exchange rate) in Mumbai-listed Deepak Fertilisers and Petrochemicals Corporation Ltd.
IFC said in a disclosure that the investment, which will be made through a mix of quasi-equity instruments, will be used to finance Deepak Fertilisers’ iso-propyl alcohol manufacturing and trading business and help raise its production capacity to 100,000 million tonnes per annum.
The money will primarily be utilised at the company’s Taloja and Panipat manufacturing sites. The project will be undertaken at an estimated total cost of $160 million, IFC added.
Deepak Fertilisers will also use part of the investment to meet the working and maintenance capital requirements of Smartchem Technologies Ltd, a wholly-owned subsidiary of Deepak Fertilisers.
The chemicals manufacturer is also looking to expand its ammonia production capabilities through Performance Chemiserve Pvt. Ltd, a subsidiary of Smartchem Technologies.
Shares of Deepak Fertilisers were trading at Rs 134.65 apiece at noon on Tuesday, nearly flat from the previous close.
Founded in 1979, Deepak Fertilisers manufactures products such as industrial chemicals, specialty fertilisers and technical ammonium nitrate. The company reported net sales of Rs 3,187.27 crore for the year ended March 2018.
IFC has announced plans to invest in a number of Indian companies in recent months.
A couple of weeks ago, it offered to provide $50 million (around Rs 351 crore) in debt funding to affordable housing loan provider Aavas Financiers Ltd to help it expand its housing finance programme in the semi-urban and rural parts of Rajasthan.
In April, the institution said it planned to make a debt investment of $150 million in mortgage lender Piramal Capital & Housing Finance Ltd.
IFC also offered up to $100 million in debt funding to Tata Motors Finance Ltd and announced a plan to invest up to $75 million in Mahindra & Mahindra Financial Services Ltd to augment its lending to micro, small and medium enterprises.