Longsheng submitted to Shanghai exchange that it is raising debt and giving bank guarantees for RMB 1.2 billion (US$ 200 million). This may be for working capital requirements. It frees up their significant reserves for Dystar purchase. Attached is the translated pdf.
600352_20250618_OPFB - Copy (1).pdf (476.0 KB)
Very important for those tracking Kiri.. Dr. Sanjay Sarkar, who headed the copper greenfield project and saw it through the inception planning and moef clearance has left Indo Asia Copper and was very unhappy with things before he exited…
Longsheng declared annual dividend with a yield of 2.5%. This indicates they are cash flow positive as total dividend payout is 813 million RMB (113 million USD).
600352_20250708_5LMM (1).pdf (103.7 KB)
Based on his recently updated profile bio (screenshot attached below, referred below as Post 1) on LinkedIn and the above shared post (Post 2) by Dr. Sanjay Sarkar, allegedly (as no confirmation has been received from Kiri) outgoing CEO and Executive Director of Indo Asia Copper Ltd. (IACL), it’s evident he undertook a comprehensive array of activities to bring the integrated copper and fertilizer project to fruition. His statements indicate significant progress on the technical, regulatory, and contractual fronts, but also clearly state that financial closure has not yet been achieved.
Here’s a compiled report that helps understand his stated activities and helps us understand the risks that his void may create if not appropriately filled :
Project Overview:
Dr. Sanjay Sarkar initiated and conceptualized an integrated Green Copper and Fertilizer Project under Indo Asia Copper Ltd. (IACL), a subsidiary of Kiri Industries Ltd., starting in May 2021. His role involved everything from naming the company and designing its logo to overseeing strategic direction and operational execution, focusing on making the project shovel-ready.
Key Activities Undertaken:
I. Land Acquisition & Site Development:
II. Feasibility, Design & Due Diligence:
2. Engagement of Consultants for Detailed Reports (Post 1, Point 2): Engaged M/s MECON Ltd., a prominent engineering consultancy, for crucial studies:
* DPR (Detailed Project Report): A comprehensive report outlining all aspects of the project.
* TEFR (Techno-Economic Feasibility Report): Assesses the technical viability and economic profitability.
* TEV (Techno-Economic Viability): Confirms technical and economic soundness for financing.
* IM (Information Memorandum): A document for potential investors and lenders.
* Market Research & Due Diligence: Conducted extensive research and due diligence for domestic and global supply-demand analysis, essential for understanding market dynamics for copper and fertilizer.
3. Technology Screening & Capex Optimization (Post 1, Point 6): Discussed multiple technologies from Australia, Japan, Finland, and China. Screened the latest Chinese technology to ensure the best economical Capital Expenditure (Capex) for a “Bankable TEFR,” implying a focus on making the project attractive for financial appraisal.
4. EPCM Consultancy & Balance of Plant (BOP) Jobs (Post 1, Point 9): Engaged MECON Ltd. for EPCM (Engineering, Procurement, Construction Management) consultancy. This involved completing “enabling jobs” on the project land before the basic engineering phase from the technology supplier and completing BOP (Balance of Plant) jobs, which are supporting infrastructure not directly part of the core process unit.
5. Authoring Core Documentation (Post 2): Personally authored and compiled critical technical and strategic documents, including TEFRs, sensitive feasibility studies, Supply Chain Management (SCM) frameworks, risk analyses, financial projections, regulatory frameworks, and various Investment Memorandums (IMs) for six phase execution options.
III. Environmental & Regulatory Clearances:
6. Comprehensive Environmental Clearance Process (Post 1, Point 3; Post 2): This was a major achievement highlighted by Dr. Sarkar.
* Initiated EC process from baseline monitoring after land acquisition (in 2022).
* Obtained Forest NOC (No Objection Certificate).
* Obtained Wildlife Conservation NOC.
* Conducted CSR (Corporate Social Responsibility) & CER (Corporate Environmental Responsibility) surveys.
* Prepared EIA/EMP (Environmental Impact Assessment / Environmental Management Plan).
* Secured CRZ (Coastal Regulation Zone) clearance.
* Obtained CTE (Consent to Establish).
* Arranged Public Hearing.
* Secured EC (Environment Clearance) in record time (November 2024) from the MoEF EAC (Ministry of Environment, Forest and Climate Change Expert Appraisal Committee) for both Industry 1 (Copper) and Industry 3 (Fertilizer), indicating approval for both segments of the integrated project.
* Dr. Sarkar emphasized personally navigating coordination with every layer of government (local, state, central) and multiple NGOs to fast-track these regulatory hurdles.
IV. Supply Chain & Off-take Security:
7. MOU for SCM Securitization (Post 1, Point 4; Post 2): Arranged multiple Memorandums of Understanding (MOUs) with major global companies like Glencore, Rio Tinto, Mitsubishi, Sinosteel, Nerin, APM Terminal, RtM Singapore, Indomer, Ecochem. These MOUs are crucial for securing both raw material supply (feedstock mapping) and potential off-take agreements, essential for de-risking the project for lenders.
V. Financial Strategy & Engagement:
8. Meetings with Rating Companies (Post 1, Point 5): Arranged multiple meetings with state and global rating companies for Kiri Industries Ltd., likely to improve the overall credit profile and ratings of the parent company, which would indirectly benefit the subsidiary’s project financing efforts.
9. Engaging Export Credit Agencies (ECA) for Debt Finance (Post 1, Point 7): Met with M/s Sinosure China for ECA-backed financing, a common route for projects involving Chinese technology suppliers to secure funds from Chinese banks.
10. Presentations to Nationalized Banks for Project Finance (Post 1, Point 8): Presented the company and project to various nationalized banks in India to secure domestic project finance.
11. Addressing Debt and Equity Visibility (Post 2): Actively managed and mitigated uncertainties related to debt and equity visibility, indicating ongoing efforts to secure funding.
VI. Contracts & Future Outlook:
12. Conclusion of EPC Contract (Post 1, Point 10): Concluded the EPC (Engineering, Procurement, and Construction) contract with a Chinese technology supplier at a price below the 2021 quoted Capex, which is a positive sign for cost efficiency. However, he explicitly states this contract is “yet to be finalized post Financial closure with Equity visibility.”
13. M&A Initiative (Post 1, Point 11): Initiated an M&A (Mergers and Acquisitions) initiative regarding the Philippines’ PASAR plant, potentially a strategic move to expand or acquire existing assets.
14. Project Completion Timeline (Post 1, Point 12): Stated that the IACL copper ore to cathode plant can be completed within 36 months once financial closure is completed.
Based on Dr. Sarkar’s statements, financial closure has not yet been reached.
Several explicit statements confirm this:
My Conclusion:
Dr. Sanjay Sarkar’s tenure at Indo Asia Copper Ltd. saw significant advancement in preparing the integrated copper and fertilizer project. He successfully navigated complex land acquisition, secured crucial environmental and regulatory clearances in record time, engaged key consultants, screened technologies, and forged important MOUs for supply chain. He also actively pursued both domestic and international debt financing and managed to conclude a cost-effective EPC contract.
However, despite these extensive efforts and the project being technically and contractually prepared, the crucial milestone of financial closure has not been achieved. The project is poised to begin construction once the equity and debt financing are fully secured and legally binding.
Also a person of his stature exiting in this fashion via a public spat doesn’t bode well for both the parties and all other stakeholders.
Next Steps:
I have reached out to the management to seek further clarity on this via their investor relations channel. I urge other shareholders of Kiri to also do the same for obvious reasons of corporate governance.
Disclosure: Invested.
Post 1 -
Post 2 -
It is the last 2 posts of his which has been most concerning… and this is in the light of the fact that about 1400 crores has come in by 31 march 2025. As it is nothing factual gets updated by the promoter management on the progress of the copper plant commissioning. We werent even informed on the receipt of EC. We have to do amateur sleuth fact finding through such posts. The website of IndoAsia Copper has the 2 ECs there and one can go through the same in details.
I have also written to Valoreum Advisors. I had to reiterate my queries a couple of times until i was acknowledged. However, as this is a third party doing a service all they said was that they shall convey my concerns to the management. My query was ofcourse the detailed end use of funds that have already come in via preferential issue and litigation finance and what stage the commissioning and installation work of the copper plant is in at the moment and that the investor presentation needs to have information related to the copper plant work progress with on site photos etc.
I absolutely second your thoughts. Myself and at least one more investor I know have been mailing the management with the above concerns and have been seeking updates and requesting them to up the ante on corporate governance and reporting.
Ive been mailing too. No response.
So full disclosure I did do a trade here when the settlement talks were going on.
However, I did sell after hearing that they would invest a percentage of the proceeds in a copper venture. It seemed to be a spectacular misallocation. Here is a company that has no experience in metal products either at mining, refining or trading stage.
Second, there was always certain level of doubt with the promoter.
Does this incident further prove the doubts.
This has been one roller coaster ride, My conservative book value per share after moeny comes in is 696 per share. Governance at best looks spotty so the doubt whether minority will see any of the money remains in the air. This resignation of CEO of Indo Asia Cooper has only added fuel to fire. I panic 10% holding yesterday but I feel one can hold till money comes in at least. There should be some rerating once the money in the bank I feel. But yes the multibagger story for me is over for sure
kiri-calculations-latest.pdf (412.5 KB)
While there have been multiple cases of promoter greed in the domestic listed space this would have to be a very elaborate con:
The sceptic in me says that it helps when everything is done through a subsidiary… and the responsible person is a certain Dr. Sarkar.. having signed on all affidavits for the EC he has been conveniently shown the door now. For a 6000 crore payday spending 50 - 100 crores playing a smoke and mirrors game seems pocketchange.
I dont think Dr Sarkar has seen anything of the 1400 crores that came in the last financial year through debt and share issue in IACL. Because he wrote about financial closure to be a future event.. while cah flow statement shows that the money flow has gone to advances, loan repayment and loans given and addition in fixed assets/WIP etc..
bottomline: promoter management needs to be accountable to the minority shareholders but we need a bit of activism.. the email ID of valorem advisors is kiri@valoremadvisors.com
This is precisely what I have been saying earlier. While we acknowledge Manish Kiri’s doggedness in pursuing the legal case for such a longtime, his selfish nature and antagonism towards minority shareholders has been exposed in recent times. First, he has increased his share holding by GDR holders and then by creeping acquisition and then by preferential issue. And this copper project has no basis except stopping distribution of proceeds. There are many cash rich individuals/ companies in India who could have gone for copper projects. What advantages Kiri has? Zero. It is like building castles in the air. If he so much wanted, he could have gone by himself instead of dragging the company and shareholders with him. Initially the project was envisaged in Odisha. But when and how it was shifted to Gujarat, nobody knows. Now with the resignation of Dr Sarkar everything is in a limbo. And Dr Sarkar also declared his unhappiness with the management, i.e. Manish Kiri.
So I am waiting till the money comes in to exit.
Neither company nor Valorem advisors replies to anything
