PROJECT

Projects

Summary of Proposed Investment

Project Number

10162

Company Name

MOSER BAER INDIA LIMITED

Date SPI Disclosed

Feb 29, 2000

Country

India

Industry

Manufacturing

Status

Completed

Sector

Computer & Electronic Products(Computers & Peripherals, Communications Equip., Elec. Watches & Similar Elec. Products. Integrated Circuits & the application of Miniturization Technologies characterize this sector.)

Department

Gbl Ind, Manufact, Agribus & Services

Environmental Category

B - Limited

Previous Events

Approved : May 16, 2000
Signed : May 17, 2000
Invested : Jun 20, 2000

Project Description

Summary Of Project Information (SPI)

Project NameIndia - Moser Baer III

RegionAsia and the Pacific
Sector
Project No010162
Projected Board DateMarch 30, 2000
Company NameMoser Baer India Limited
Technical Partner and/or Major Shareholders

Moser Baer India Limited (MBIL) is a professionally managed company belonging to the Delhi-based Puri family. The main sponsors are Deepak Puri, an engineering graduate from Imperial College, London, and his son Ratul, a computer engineer from Carnegie-Mellon, USA. The company was originally promoted in 1983 as a joint venture with Moser-Baer AG, Switzerland, to assemble time keeping systems. But due to market limitations it diversified into diskettes in 1986 when the Puri family purchased the Swiss company’s shares and also went public.
Of MBIL’s total equity, presently 35% is held by the sponsors, 21% by IFC, 18% by Jardine Fleming group companies and 26% by others, including the general public.

Project Cost Including proposed IFC investment

The total cost of project is estimated at US$233 million. IFC is considering an equity investment of US$25 million and a term loan of US$45 million.

Location of project and Description of site

The project envisages an expansion in capacity at the MBIL''s existing Recordable Compact Disks (CD-R) plant site at Noida industrial area near New Delhi, as well as setting up a new facility at a greenfield location. While the location of the new facility is yet to be finalised, the company has identified a couple of sites in the industrial areas at Noida and Gurgaon, both in the vicinity of New Delhi. These industrial areas have basic infrastructure facilities of connecting roads, power, telecommunications and common sewage disposal systems. Skilled manpower and raw materials are easily available.

Description of Company and Purpose of Project

Moser Baer India Limited is an existing IFC client and a leading producer and exporter of diskettes in India. Presently, the company is in an advanced stage of establishing a CD-R manufacturing facility at Noida to produce CD-Rs with a capacity of 171 million CD-Rs per annum. During the first nine months of the current financial year, the company has sold 92 million floppy discs and 3.4 million CD-Rs produced from the lines that are already operational. Net sales for this period have been US$22.6 million on which the company has earned a cash profit of US$7.1 million and a net profit of US$5.8 million (25.7% of net sales). Based on the projected sales of the last quarter, the company’s sales and net profits for the FY ended March 2000 are estimated at US$28.5 million and US$9.0 million respectively.
The proposed project (Moser Baer III) envisages increasing the company’s CD-R capacity to about 700 million p.a. This increase in capacity will be implemented by (a) installing additional lines at its existing CD-R plant site and (b) setting up a completely new facility. The total project cost is estimated at US$233 million and is expected to be completed by March 2002.     
IFC’s participation in the project would assist the company in becoming a world-scale, low cost producer of data storage products and is in line with IFC strategy in South Asia for supporting the high-tech and export oriented sectors. Besides earning foreign exchange for the country, the project would also provide employment to over 1400 skilled workers and engineers.
    
Environmental Category and Issues

This is a category B project according to IFC’s environmental review procedure and the following potential environmental, social, health and safety impacts of the project were analyzed: site acquisition and development; liquid waste; solid waste management and handling; hazardous materials handling and management; air emissions; occupational health and safety; Environmental Management Systems; and company environmental performance on earlier IFC investments
The expansion area at the existing site and proposed new factory site will both be located in industrial zones and there will be no impacts on natural habitats. The project will not result in economic displacement. Water use and disposal, solid waste handling, air emissions and occupational health and safety issues for IFCs existing investments are in compliance with World Bank Group (WBG) requirements. Expansion plans are being designed to comply with WBG requirements and both sites should operate in compliance. The company has a formal environmental policy and provides training in environmental matters to its employees. Responsibility for environmental matters has been designated to a senior Moser Baer Manager and the company has provided copies of relevant permits and operating licenses to IFC.
The company will display the ERS at the Project Site, in the local language (Hindi) and in English. A newspaper advertisement to this effect is being placed in “Dainik Jargran” a widely circulated local newspaper, and the same is likely to appear on Monday, February 28, 2000.


The is from the InfoShop.

Host country location of environmental documentsAt the gates of the Moser Baer India Limited’s existing plant for the manufacture of CD-Rs, at A-164, Sector 80, Noida.

Date SPI sent to InfoShop February 29, 2000
“This Summary of Project Information is prepared and distributed to the public in advance of consideration of the proposed transaction by the Corporation’s Board of Directors. It is provided for the purpose of enhancing the transparency of IFC’s activities and should not be construed as presuming the outcome of IFC Board consideration.”

For Additional Information contact: Corporate Relations Unit -
telephone: (202) 473-7711
facsimile: (202) 974-4384

Environmental documents for this project are available at http://www.ifc.org and from the World Bank InfoShop (http://www.worldbank.org/html/pic/aboutinfo.html).

Sponsor / Cost / Location