|Photo: Flowing Health GmbH|
Jaiprakash Associates Ltd’s expansion into unrelated businesses is puzzling analysts. The company, which is predominantly into cement production, construction and real estate development, entered agriculture-related and hospitals businesses. It is building a 1,200-bed hospital near Noida. Under the agriculture-related initiatives, the company has set up a soya and mustard processing plant in Madhya Pradesh. It participated as a strategic investor in the rehabilitation scheme of fertilizer manufacturer Duncans Industries Ltd. To revamp the manufacturing plants, Jaiprakash Associates-controlled firms incurred a capital expenditure of Rs.911 crore.
The company also launched a dairy project under which it plans to build a milk processing unit and launch its own brand of dairy products. Apart from all this, the company is exploring the opportunity of setting up a semiconductor fabrication facility. To be sure, the initiatives may be lucrative. But what is intriguing is the diversification is happening amidst a funds crunch.