I assume about why they took the loan could be understood and may have been utilised if financial closure of the copper project would have been on track.
What the management has failed to address, accept and take responsibility in the concall is that the copper project has in fact been delayed due to multiple reasons (Dr. Sarkar and the management’s missteps. IMO, yes it is a joint responsibility). They have made the delay apparent via their ROC filing and loaded the entire blame on Dr. Sarkar but in the concall all of that delay rhetoric was hushed.
In Q2 FY25 concall they had stated this regarding the interest on the loan (quoting from 19 Nov, 2024 published transcript ) -
Manish Kiri: As I mentioned earlier, these are the, you know there’s the judgment funding and the funds who do these kinds of activities, they are based overseas, out of India, in Singapore and it would cost back ended IRR based almost 15% to the company.
Ayush: So, it would cost around 15%, you say?
Manish Kiri: Correct.
Ayush: And that would be 15% on dollar or INR?
Manish Kiri: On dollar because the it’s all dollar linked, the reserves dollar linked, the investment linked, you know the borrowing is dollar linked.
The figure of ₹1143 cr doesn’t seem to add up to include the principle and the accrued interest over the period. May I request someone to help make sense of this calculation at 15% interest from September, 2024. is in the PPT and is till FY25. So we must wait for FY25 annual report as the exact date of receipt of funds into Claronex is not known.
To summarise, here’s what the management stated regarding the copper project’s timeline and status:
• The project implementation is on track
• Technology supply agreements have been executed, and project work has already commenced at the site
• Orders are being placed to various vendors, and the project team has significantly strengthened, increasing to almost 25 people and expected to grow to 40-50 people by the end of the current quarter
• Partial revenue from the copper project is expected to start from FY27 , with full capacity installed by 2028 and fully operational by 2029-2030
• The company will provide updates on the project’s progress, timeline, and key aspects in their management notes starting from the next quarter
The management’s statements indicate that the project is progressing as planned rather than facing delays.