Russia invests 95 million euro to build brick  favtory 

MOSCOW: Russian developer LSR Group said on Wednesday it would invest around 95 million euros ($144.5 million) in a new brick factory to meet growing demand for building materials amid a construction boom. 

The company said in a statement construction of the plant would be financed through loans and proceeds from its initial public offering. LSR raised $772 million in a November IPO, which valued the firm at around $6.8 billion.

"We are witnessing increasing demand for building materials, particularly bricks, driven by the growing construction volumes in the region and the rapid development of the regional property segment," said Chief Executive Igor Levit.

"The new plant will help to meet the demand for this building material, further strengthening the group's revenue streams," he said. Construction, on a list of the Russian government top priority projects, is booming amid robust economic growth and rising disposable incomes, with double-digit annual growth rates in housing completions each month.

Levit told the media in an interview last month LSR would invest more than $1.2 billion this year, including around $600 million for industry projects, mainly for new brick and concrete plants to be launched in 2010. LSR said it expected to complete the first production line of the new plant, to be built in the Leningrad region around Russia's No. 2 city, St Petersburg, by 2010.

The plant will have a total capacity of 220 million building bricks a year. The company, which focuses on property development and building materials in St Petersburg, is already one of the largest producers of ceramic bricks and aerated concrete in Russia. It is majority owned by businessman Andrei Molchanov.

Article source: http://economictimes.indiatimes.com/News/International_Business/Russias_LSR_to_build_95_million_euro_brick_factory/articleshow/2840155.cms