DSCL Bharuch Expansion

completed

DCM Shriram Consolidated Limited (DSCL or the company) is a diversified mid-tier Indian company, with an annual turnover of $620 million. DSCL has four main businesses – caustic soda/chlorine, polyvinyl chloride (PVC), urea and sugar. DSCL’s chemicals facilities include a large integrated unit in Kota, Rajasthan and a chlor-alkali plant in Bharuch, Gujarat. DSCL is a strong regional player, capitalizing on its low cost integrated production facilities and close proximity to raw material. The company primarily serves the northern and western Indian markets, where it also has a freight cost advantage relative to other domestic players and imports. The proposed transaction comprises a corporate loan plus loan equivalent exposure to convert DSCL’s existing and proposed IFC loans into Indian rupees to hedge the company’s US dollar exposure. The corporate loan is proposed to be used primarily for DSCL’s ongoing expansion of its chlor-alkali capacity at Bharuch from 200 tons per day (tpd) to 435 tpd, modernization projects at its Kota facility, and refinancing an existing loan. IFC has an existing investment in DSCL (project #23385), which was made in 2005.