New Delhi: Tyre maker Ceat, which plans to raise up to Rs 500 crore through issue of securities, will use majority of the fund to finance expansion of its ongoing projects in Bangladesh and Gujarat.
Around Rs 300 crore will be invested in the Bangladesh project, while some portion of the raised capital would also be put in the Halol plant, which is currently undergoing expansion.
"The company has two large projects- there is one in Bangladesh, which is already underway where we will be investing about Rs 300 crore and the second is a project in Halol where we are adding some passenger-car radial capacity that is about Rs 650 crore expansion. Some of the funds raised will be used for that," Ceat Ltd Managing Director Anant Goenka said.
Some amount would be used for further expansion plans, opportunities that could come up in the next six-eight months' time as well, he added.
The company's board had earlier this week approved to raise an amount not exceeding Rs 500 crore through further issue of securities including equity shares or Foreign Currency Convertible Bonds or American Depository Receipts.
As per the board approval, the firm can also raise capital via convertible debentures, non convertible debentures, preference shares convertible into equity shares or any other equity linked securities, by way of one or more public or private offerings, including qualified institutions placement.
The Mumbai-headquartered company, which produces tyres, tubes and flaps, said it is still to work out the exact amount to be raised through the issue of securities.
Ceat shares were trading at Rs 587.40 apiece on the BSE, down 0.11 percent from previous close.
