Balrampur Chini raises ₹450 crore for UP PLA in 2026

What the company announced

Balrampur Chini Mills Ltd has raised ₹450 crore through a preferential issue of equity shares to fund expansion projects in Uttar Pradesh, including a new lactogypsum processing plant and higher capital expenditure for its poly lactic acid (PLA) facility. The development signals a sharper push by the Kolkata-headquartered sugar company into newer businesses beyond its traditional operations.

Executive Director Avantika Saraogi told PTI that the fundraise is meant to support the company’s expansion and growth plans. She added that promoters also participated in the preferential issue and invested nearly ₹200 crore.

The company has diversified into the bio-plastic business and is setting up a PLA manufacturing plant at Kumbhi, Uttar Pradesh, with an annual capacity of 80,000 tonnes. Alongside PLA, the board has also approved an integrated plan to process lactogypsum, a byproduct from PLA operations, into gypsum boards.

Board decisions and regulatory disclosures

In a regulatory filing, Balrampur Chini said its board approved a set of financing and project decisions at a meeting held on April 23, 2026. The meeting commenced at 11:00 AM and concluded at 2:45 PM, as disclosed.

The approvals include the preferential allotment of equity shares, an enabling plan to raise debt through non-convertible debentures (NCDs), and the establishment of a lactogypsum processing plant at Kumbhi. The filing also linked the lactogypsum unit directly to the PLA project as a byproduct-utilisation facility.

An Extraordinary General Meeting (EGM) has been scheduled for May 20, 2026, through video conferencing to seek shareholder approval for the proposed actions.

Preferential issue: size, price, and participation

The preferential issue is sized at up to ₹450 crore. The company disclosed an issue price of ₹483 per equity share and proposed issuance of up to 93,16,771 equity shares.

Promoters are among the subscribers, and promoter participation was described as approximately 43 percent in the disclosed snapshot. Separately, Saraogi told PTI that promoter investment in the issue is nearly ₹200 crore.

One report also noted the stock closed at ₹540.30 per share on the NSE on Thursday (as stated in the provided material), placing the preferential price and market price context side by side for investors tracking dilution and fundraising terms.

Use of proceeds: lactogypsum plant, PLA capex, and corporate needs

Saraogi said ₹160 crore will be invested to set up a lactogypsum processing plant in Uttar Pradesh. The company also said up to ₹160 crore of the preferential issue proceeds may be used for funding the lactogypsum project.

The company has revised the capital expenditure on its PLA manufacturing plant upward by ₹230 crore to ₹3,080 crore from the earlier estimate of ₹2,850 crore. Another reference in the material described the revised figure as nearly ₹3,100 crore, while the detailed board approval cites ₹3,080 crore.

Saraogi said the remaining ₹60 crore from the ₹450 crore equity raise would be used for general corporate purposes.

PLA project: higher capex, same 80,000 tpa capacity

Balrampur Chini’s PLA project at Kumbhi remains designed for 80,000 tonnes per annum capacity. What has changed is the estimated investment outlay.

The company attributed the ₹230 crore increase in project cost to multiple factors: an increase in prices of key construction materials, global supply chain disruptions, and changes in engineering and design during modelling review. These explanations were captured in the regulatory disclosure describing the cost escalation and the need to revise the budget.

Saraogi said the PLA plant is likely to be operational this year, as per her comments to PTI.

Lactogypsum plant: turning PLA byproduct into boards

The lactogypsum processing plant will be located at Kumbhi, Uttar Pradesh, and has an estimated cost of up to ₹160 crore. The proposed facility is designed to manufacture gypsum boards using lactogypsum generated from the company’s PLA operations.

Balrampur Chini disclosed that the plant will have an installed capacity of about 76 lakh gypsum boards per annum. One of the provided updates also stated that commercial production is expected to commence by December 2027, subject to the receipt of necessary approvals.

The company’s stated intent is to create an integrated manufacturing ecosystem where a byproduct from one unit becomes raw material for another, potentially improving resource utilisation within the new bio-plastics value chain.

Additional financing flexibility: NCD plan

Beyond the ₹450 crore equity fundraising, the board has authorised issuance of non-convertible debentures (NCDs) up to ₹200 crore. The NCDs are proposed to be raised via private placement, in one or more tranches, and described as listed and secured in the provided details.

For the enhanced PLA capex, the company said the revised project cost will be funded through a combination of equity raised on a preferential basis, debt, and internal accruals. This aligns the equity and debt approvals with the capex revision and the additional byproduct-processing investment.

Key numbers at a glance

Why the fundraising matters for Balrampur Chini

Balrampur Chini’s approvals highlight a clearer capital allocation path for its diversification into bio-plastics through PLA manufacturing and into building-material output through gypsum boards. The linkage between PLA operations and lactogypsum processing positions the gypsum unit as a byproduct-utilisation facility rather than a standalone venture.

For investors, the disclosures provide measurable checkpoints: execution of the preferential allotment, shareholder approvals at the May 20 EGM, and subsequent updates on NCD terms when tranches are issued. On the projects side, timelines span near-term operational expectations for the PLA plant this year (as indicated by management) and a longer horizon for gypsum board production by December 2027.

Conclusion

Balrampur Chini’s ₹450 crore preferential equity raise, coupled with an enabling ₹200 crore NCD plan, is designed to support a higher ₹3,080 crore PLA capex and a new ₹160 crore lactogypsum processing plant at Kumbhi, Uttar Pradesh. The next formal milestone disclosed is shareholder voting at the May 20, 2026 EGM, followed by fundraising execution and project-progress updates.