Unitex Group to splash out Tk 650cr on new ventures
Unitex Group plans to invest about Tk 650 crore to create manufacturing plants for chemicals, steel, and paint at the Bangabandhu Sheikh Mujib Shilpa Nagar (BSMSN) in Chattogram.
The company has recently submitted its investment proposal to the Bangladesh Economic Zones Authority (BEZA), seeking a 20-acre plot at the BSMSN.
"We begin development work on the proposed project after getting the land allotment," said Mohammad Arif, the chief financial officer of Unitex, adding that he expects to secure a lease agreement by December.
Of the full total investment, an exclusive bank has hinted that it could finance 60 % of the project as the rest will be paid through the business's equity.
The program will be implemented in phases with the steel and chemical manufacturing plants to be constructed first as the paint factory will be established later.
Bangladesh's steel industry keeps growing based on the government's development works in the industry, housing, and public sectors.
It's estimated that the sector generates around $3.6 billion in earnings every year and in 2016, government projects accounted for about 40 % of the country's total steel consumption.
Knowing that the new steel manufacturing unit, which is expected to create about 1,100 opportunities for direct employment, will be dedicated to the local market.
Alternatively, the chemical plant will give both the domestic and export markets.
Asked about the challenges when coming up with such investments, Arif said that each investment carries the prospect of loss or gain.
"But these sectors where we are investing have proven promises for the future," he added.
Unitex commenced its journey as a spinning and composite yarn manufacturing business in 1992 and has since evolved into a rapidly growing multi-dimensional conglomerate.
The group considers itself to become a solution provider, mostly for cotton sourcing and logistics support. Unitex also provides a wide selection of services in other sectors, including liquid petroleum gas and petroleum.
Meanwhile, Beza Executive Chairman Paban Chowdhury said they will allow construction work on these factories to commence following the central effluent treatment plant is established. The country's economic zones authority encourages this kind of investment within the BSMSN as it will generate more employment opportunities.
The land will be allotted for the project considering Unitex's investment plans, he added.
According to the investment proposal, Unitex really wants to produce import substitutes for chemical, steel, and paint products in the domestic market.
The group made a decision to invest after assessing the market's potential as it has a keen understanding of business.
Because of this, they shouldn't face any challenge to create this investment, Chowdhury said.
