Hindustan Copper Chairman Ahmed Comments on Copper Prices, Loans
The company plans to raise overseas loans to fund a 40- billion-rupee ($759 million) plan to expand mining capacity fourfold to 12.4 million metric tons by March 2017 and won’t sell new shares because of poor market conditions. Ahmed spoke at his office in Kolkata, where the company is based.
On copper prices:
“Copper prices should remain between $7,000 and $8,500 per ton. It has corrected to $7,300 per ton now from $10,000 per ton in February. Our savior has been the 20 percent depreciation in the rupee in the same period. So far, there hasn’t been any significant impact on our revenue.
‘‘The global economic outlook is not certain. The uncertainty in the euro debt zone continues and there is some slowing in the Chinese economy. These three factors will decide the future direction of copper prices.’’
On borrowing plans:
‘‘We will face a shortfall of about 2.07 billion rupees between our revenue generation and investment requirement in the financial year ending March 2014. External commercial borrowing is our preferred option for raising the money.
‘‘There is a natural hedge in our revenue model as our copper prices are linked to global copper prices on London Metal Exchange. So we don’t have to hedge our overseas borrowings.’’
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