International Finance Corporation (IFC), the private sector investment arm of the World Bank, is planning to lend up to $8 million (Rs 44 crore) to Mumbai-headquartered Hikal Ltd. The loan will part-finance the company’s $15.5 million proposed programme in resource efficiency and GHG (greenhouse gas) abatement projects.
Started in 1988, Hikal manufactures active pharmaceutical ingredients (APIs) and crop protection products. The firm was founded by Jai Hiremath who has been running the company since its inception and is currently the chairman-cum-managing director. Majority of its revenues and earnings are generated from its API business.
Hikal has manufacturing plants and facilities across five locations – Bangalore, Panoli (Gujarat), Mahad, Taloja and Pune (Maharashtra).
The company raised funding from IFC back in September 2008 for capacity expansion and IFC currently holds 8.27 per cent stake in the public-listed company. Hikal’s promoter group holds 69 per cent stake and the general public & others hold 23 per cent stake.
In 2005, Hikal acquired a minority stake in Jiangsu Chemstar Industries Ltd, a subsidiary of Sinochem Corporation.
IFC has been particularly active in supporting Indian firms with loans since the beginning of this year. Over the past eight weeks, it has announced proposed debt deals worth over $300 million with Bhilwara Energy, UltraTech, Cross Border Power Transmission Company, HDFC, Dewan Housing Finance and Snowman Logistics, among others. This is in addition to equity deals.
(Edited by Sanghamitra Mandal)