BK Birla-promoted Kesoram Industries plans to raise Rs 500 crore of fresh funds from the bonds market to part-finance its expansion programme.

The bonds will carry a coupon rate of about 10% with tenure of 5 years or less. The balance amount of Rs 340 crore will be financed by internal accruals, said SK Parik, Director & Secretary of the Company.

The funds will be used to finance the company’s Rs 840-crore investment plans, which includes a radial tyre plant with 100 tonnes per day capacity at a capital expenditure of Rs 495 crore and another bias tyre plant for trucks with farm sector equipment having a capacity of 125 tonnes a day, involving an investment of Rs 345 crore.

The company is at present implementing Rs 550-crore expansion project of its cement unit in Karnataka, and a Rs 100-crore expansion plan of its tyre unit in Balasore in Orissa.

Recently, the company announced 32.1 per cent rise in net profit for the last quarter of 2007-08 at Rs 105.79 crore as compared to Rs 80.08 crore in the same period last fiscal.