Asian Paints to set up Rs 1,750 crore facility in Andhra Pradesh

Asian Paints, the leading domestic player, will set up a manufacturing facility in Andhra Pradesh at an investment of Rs 1,750 crore, spread over 12 years.

The company has signed a Memorandum of Understanding (MoU) with the state government to set up the plant for paints and intermediates at Pudi Village in Vishakhapatnam district.

The maximum capacity of the proposed facility would be 4,00,000 kiloliters per annum and the company would invest money in several phases, Asian Paints informed the Bombay Stock Exchange (BSE) on Tuesday.

"An amount of approximately Rs 1,750 crore would be invested by the Company in phases over a period of 12 years from the date of commencement of construction including the cost of land measuring approximately 110 acres, subject to due diligence and obtaining necessary regulatory and other approvals," Asian Paints informed the bourses.

It would use latest manufacturing concepts to produce paints and intermediates in the said plant in an environmentally friendly manner, Asian Paints added.

The state government has offered reimbursement of 100 per cent gross VAT/State Goods and Service Tax (SGST) for a period of 12 years.

However, it would be subject to an overall cap of 100 per cent of eligible investments and Asian Paints would have to achieve 70 per cent of its proposed investment of Rs 1,750 crore within a period of five years.

Apart from that it would also get other incentives as per the Andhra Pradesh Industrial Investment Promotion Policy 2010-2015, it added.

The MoU was signed in the presence of Chief Minister N Chandrababu Naidu.

The proposed plant is likely to create employment for 700 people, according to a government release in Hyderabad.

The project would result in the generation of direct and indirect employment and create opportunities for other ancillary industries, it said.

It would also bring direct and indirect benefits to the domestic economy, it added.

Speaking at the MoU signing ceremony, Naidu hoped that setting up of the facility would lead to more industries in Visakhapatnam.