Comments /2487 Views / Thursday, 7 February 2013 00:11
Tokyo Cement (Lanka) Plc yesterday announced a new wholly-owned subsidiary to undertake a Rs. 8 billion investment to expand its core product as well as build a biomass energy project.
The company said for this purpose, Tokyo Eastern Cement Company Ltd. (TECC) has been set up with the approval of the Board of Investment recently.
“The principle objects of TECC are to carry on the business of manufacturers and dealer in cement, tile cement and cement products and also to build, operate and manage a biomass power generation plant for the utilisation of power generated by it for its own use and for sale of excess units of electricity to the National Grid,” Tokyo Cement said.
The construction of the plant is expected to be completed in three years at an estimated cost of Rs. 8 b, and will be financed mainly by the company’s equity and bank borrowings.
The company also said TECC is entitled to fiscal and tax incentives for a period of five years, after which the company is liable to a concessionary income tax rate of 12%.
Tokyo Cement Group already comprises Fuji Cement Company (Lanka) Ltd., Tokyo Super Cement Company Lanka Ltd., Tokyo Cement Colombo Terminal Ltd., and Tokyo Cement Power Ltd.
In operation for three decades, Tokyo Cement is the largest manufacturer and supplier of cement in Sri Lanka.
As per its 2011/12 Annual Report, the company continued to successfully generate power through a biomass power plant at the Trincomalee factory. The biomass power plant at Trincomalee currently generates 10 MW of electricity, to power its cement plants. The excess capacity generated is sold to the National Grid, supporting national energy requirements.
“We are also exploring other areas of possible expansion into the biomass power segment, by using paddy husk and wood chips of the gliricidia tree,” Tokyo Cement Joint Managing Director S.R. Gnanam had said in the Annual Report.
According to him, another five MW biomass dendro power plant is being installed in Mahiyangana, where the entire output is sold to the National Grid.
“We are constantly exploring ways to deploy environmentally-friendly energy throughout our operations, to preserve the natural environment,” Gnanam added.
As of September 2012, the major shareholders of the company were Nippon Coke and Engineering Ltd. of Japan (27%), St. Anthony’s Consolidated Ltd. (27.5%), and South Asian Investment Ltd. (16.3%).
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