Indian IPO

All details about Hot Indian Primary Market.

Monday, January 30, 2006

CIL plans Rs 3,000cr IPO

Having converted all its subsidiaries into profit-making entities, public sector Coal India, CIL, is now planning to hit the capital market with its maiden public offer of 5% paid-up capital to raise an ambitious Rs 3,000 crore (Rs 30 billion), reports The Financial Express.

The entire proceeds from the proposed initial public offer, IPO, would be used to fund the company’s expansion programme where CIL is targeting to increase production to 571 million tonne by the end of 11th Plan period (2011-12).

According to highly-placed sources, the coal PSU has already apprised the coal ministry of its intentions and once the green signal comes, it would seek board proposal for issuing 5% of its equity capital of Rs 6,316 crore (Rs 63.16 billion) - about Rs 315 crore (Rs 3.15 billion) in the market.

CIL has also applied to the department of public enterprises to get a mini-ratna status that would add value to the company and help it get better premium on shares.

Credit rating agency Crisil has already upgraded CIL’s rating for long-term debt programme from AA to the highest rating of AAA. This, and the overall buoyant coal market, will enable the PSU secure a hefty premium and realise in excess of Rs 3,000 crore (Rs 30 billion) through the IPO.

With CIL’s two subsidiaries, Bharat Coking Coal and Eastern Coalfields turning around in the third quarter, all CIL subsidiaries are in profit mode. CIL expects to double its profits to about Rs 4,900 crore (Rs 49 billion) on a turnover of Rs 32,000 crore (Rs 320 billion) this fiscal.


Source: Moneycontrol

Saturday, January 28, 2006

Deccan Aviation files DRHP with Sebi for IPO

Deccan Aviation soon proposes to enter the capital market with a public issue of 2,45,46,000 equity shares of Rs 10 each through the 100% book building process to fund its expansion plan. It has filed the DRHP with Sebi for the purpose, according to a release.

Deccan Aviation, operating Air Deccan, a leading no-frills, low-cost, scheduled commercial passenger airline in India, has drawn out their expansion plans.

The plans include setting up of a training centre, a hangar facility for basic and medium level maintenance checks at Chennai and creating infrastructure at airports. The plan also covers market development initiatives.

The issue would constitute 25% of the fully diluted post issue paid-up capital of the company.

The book running lead managers to the issue are Enam Financial Consultants, J P Morgan India, ABN AMRO Securities (India), ICICI Securities and SBI Capital Market. Karvy Computershare is the registrar to the issue.

Air Deccan began scheduled operations in August 2003, with a single ATR turboprop aircraft flying a single route between Bangalore and Hubli. It is one of the fastest growing scheduled commercial passenger airlines today.

Source:moneycontrol

Indian Bank defers IPO

Fully state owned, Chennai-based Indian Bank has deferred its plans to go in for an initial public offering, IPO, reports The Financial Express.

The bank’s Chairman and Managing Director, KC Chakraborty said, “We had applied to the MoF, a proposal to restructure our capital base which is currently at Rs 4,500 crore (Rs 45 billion). Since the application is still pending with the MoF, we have, as of now, dropped our plans to come out with an IPO in this fiscal.”

He also said, “There is a definite upward pressure on interest rates. We had hiked our deposit rates a week ago. Following that, we also plan to raise the rates on short term as well as sub-PLR rates, including retail loan rates. ”

The bank posted a rise of 65.5% in its net profit at Rs 123.2 crore (Rs 1.23 billion) for the Q3 ended December 31, 2005, against Rs 74.4 crore (Rs 744 million) recorded in the corresponding quarter of the preceding fiscal.

Its net interest income improved by 11.78% to Rs 369 crore (Rs 3.69 billion) from Rs 330.2 crore (Rs 3.30 billion).

Deccan Chronicle to consider listing Odyssey India via IPO

Deccan Chronicle Holdings has informed the BSE that a meeting of the board of directors of the company will be held on February 01, 2006, to reconsider the merger of Odyssey India, currently a 100% subsidiary of the company with itself and list the Odyssey India through an IPO to unlock value to the shareholders.

At 11:57 am, Deccan Chronicle is quoting at Rs 361.90, down Rs 5.65, or 1.54%. It is trading with volumes of 8,123 shares on the BSE.

It has touched an intraday high of Rs 372 and an intraday low of Rs 355.25. Yesterday the share closed up 2.03% or Rs 7.30 at Rs 367.55.

Source:moneycontrol

Sun Network to go public by mid-2006

Sun Network, one of India's largest media companies is planning an IPO this year, and will launch a slew of new television and radio channels. All these plans, even as the company's cable distribution arm could soon be taken over by the Tamil Nadu state government.

The Sun network which owns popular TV channels like Sun TV, KTV and Surya will finally go public by the middle of this year. Sun network's
Sumangali is the biggest - controlling about 85% of distribution in Chennai and is a monopoly in smaller cities like Trichy, Madurai and Coimbatore. Sources tell CNBC-TV18 that the company which also runs several newspapers and radios stations across South India plans to raise about Rs 800 crore and has appointed DSP Merril Lynch and Kotak Securities as book running lead managers.

Sun TV officials refuse to confirm whether they are indeed planning an IPO, but sources tell us that not only that the company also plans to launch a slew of new channels including one for children and a 24 hour sports channel. Sources also say the money will be used to beef up Sumangali Cable Vision, Sun TV's cable distribution company that dominates the business in Tamil Nadu.

It is this dominance that Jayalalitha says she wants to end with a new bill that proposes the state takeover of big multi-system operators or Multi Syatem Operators, MSO, in Tamil Nadu. But legal experts say such a bill cannot be passed by the State Government as MSO are governed by central law which is why a similar bill was rejected by the Tamil Nadu governor in 2002. But industry sources say this issue will soon blow over and Sun IPO will go ahead as planned.

Source:moneycontrol

Tuesday, January 24, 2006

RIL to issue fresh IPO to fund mega expansion

Just after the seperation of Reliance group companies on the bourses, the Mukesh Ambani group has announced the re-birth of Reliance Petroleum. This will be an entirely new company and will come out with a mega initial public offer, the first from the Ambanis in 13 years.

The state of the art Reliance refinery at Jamnagar in Gujarat will soon be doubling its capacity from around 3 million tonnes currently to 6 million tonnes, once the expansion is completed. For this, investments to the tune of USD6 billion have been outlined.

So, how will Reliance raise so much money? RIL has created a new subsidiary with an old, familiar name-Reliance Petroleum Limited, that will raise the amount through a mix of an IPO and debts. In what could be one of the largest IPOs, Reliance plans to raise around USD1.1 billion to USD1.3 billion through the capital market while it plans to take debts to the tune of USD3.5 billion.

Reliance Petroleum will also be in charge of implementing both the refinery and polypropelene projects. Interestingly, this will be a rebirth for Reliance Petroleum Limited, that was merged into Reliance Industries in 2002.

Chandrani Pearls plans IPO

Chandrani Pearls is planning an initial public offering, IPO, latest by 2008 to fund its aggressive pan-Indian expansion target of setting up 100 stores by the same year, reports Business Standard.

Speaking on the unveiling of the new 21st anniversary range, Kuldip Nayar, owner of Chandrani Pearls said that the whole business of promoting pearls in India is very capital intensive as it involves a lot of category promotion, the awareness levels being very low and thus such an aggressive marketing and promotional activities assumes generic importance.

The company currently spends 15% of its turnover on marketing and promotional activities.

"The estimated cost of expansion target would be around Rs 30 crore (Rs 300 million) while the current pearl market in the country is estimated at Rs 35 crore (Rs 350 million), being at a nascent stage," Nayar added.

The market size also includes the Hyderabadi pearl shop owners numbering 300 to 400.

Many of them, like Mangat Rai and Jagadamba pearls, had recently switched focus to gold. The company currently has over 40 showrooms across the country and plans to open four more by March 31, 2006.

Nayar pointed out that from a modest beginning of Rs 18 lakh turnover in 1994-95 it has grown to Rs 11 crore (Rs 110 million) in the last fiscal.

The target for the current fiscal is Rs 14 crore (Rs 140 million) and Chandrani Pearls is expected to cross Rs 25 crore (Rs 250 million) in turnover by 2008, Nayar stated.

The company has experienced 25% growth year on year for the last three years, he remarked.

In the last seven years the annual average cumulative growth rate has been 55%, Nayar outlined.

Chandrani Pearls is the only pearl distributor, which besides offering a certificate of authenticity offers a 70% buy back guarantee on all pearls sold by them.

Sunday, January 22, 2006

Kewal Kiran Clothing plans IPO, files DRHP with Sebi

Kewal Kiran Clothing, one of India's leading manufacturers and marketers of branded apparels in the men's segment, proposes to set up new manufacturing facilities and expansion of its distribution network by opening additional exclusive outlets. The total investment outlay is estimated at Rs 72 crore (Rs 720 million), according to a release.

To part finance this expansion plan, Kewal Kiran Clothing soon proposes to enter the capital market with an IPO of 31,00,000 equity shares of Rs 10 each through 100% book building process. It has filed DRHP with Sebi for the purpose.

ENAM Financial Consultants is the sole book running lead manager to the issue.

The issue would constitute 25.15% of full-diluted post issue paid up capital of the company and the shares are proposed to be listed on BSE and NSE

Kewal Kiran Clothing is an integrated apparel manufacturer and in the business of designing, manufacturing, branding and selling of ready-made apparels and other accessories under various brands. Their brands range from the high fashion premium segment such as 'Killer' for denim wear and 'Easies' for casual wear to the middle and economy segments through brands such as 'Lawman' and 'Integriti'.

In order to have more brand visibility and better reach to the customers with a pan India presence and also to expand its reach and serve additional customers in existing and new geographies, the company intends to set up additional 116 exclusive retail outlets, in addition to the existing 27 retail outlets across the country called "K-Lounge".

The company has four manufacturing facilities at Dadar (Mumbai), Goregoan (Mumbai), Vapi (Gujarat) and at Daman (Union Territory) with a total annual capacity of 2 million pieces. The distribution channel comprises of a mix of their own stores (K-Lounge) and a network of National Chain Stores, NCS, and Multi Brand Outlets, MBO.

As on December 31, 2005, the company has 27 K-Lounge stores and also present at 48 locations of National Chain Stores. The company is looking to further their presence in the growing Indian markets by rolling out their exclusive stores and through the presence in various department stores chains.

The consolidated restated revenues for the year ended March 31, 2005 was Rs 268.42 million as compared to Rs 253.90 million for the year ended March 31, 2004. Consolidated restated profit after tax was Rs 38.27 million for the year ended March 31, 2005 as compared to Rs 38.79 million for the ended March 31, 2004.

ARS Systems plans IPO in June-July 06

Distribution & Logistics Company ARS Systems is joining the public issue bandwagon. The company plans to raise Rs 21 crore from its IPO of 30 lakh shares. The company is planning this issue some time in June-July this year.

The company is hoping to close FY05 with a turnover of about Rs 18 crore. In the next financial year, it aims to double that. Says the company's Chairman and CEO Sudhir Mehra, "We will be closing FY05 at about Rs 18 crore. Next year, we are looking at doubling the turnover. We should be targeting about Rs 36 crore next year."

The company is looking at South Africa and its neighbouring countries as upcoming market for its products.

Sinclairs Hotels to raise Rs 60cr via equity issue

The Kolkata-based Sinclairs Hotels yesterday decided to raise Rs 60 crore (Rs 600 million) by issuing equity shares, report agencies.

The board of directors took a decision in this regard at its meeting, the company, operating hotels at Ooty, Darjeeling, Port Blair, Chalsa and Siliguri, informed the stock exchanges.

The board resolved to make further issue of equity shares at such premium for such sum not exceeding Rs 60 crore (Rs 600 million) and on such other terms and conditions in accordance with Sebi (Disclosure & Investor Protection) Guidelines 2000, it said.

The company is expected to invest the raised amount to set up new hotels and upgrade the existing ones over the next five years.

The hotel chain is also bullish on the prospects of its property at Chalsa in the Dooars region of North Bengal.

Air Deccan IPO in first quarter this year: Gopinath

Budget carrier Air Deccan yesterday said it would come up with its initial public offer, IPO, in the first quarter of this year to fund the airline's expansion plans, report agencies.

The airline will take a decision this week about the percentage of equity to be diluted and the size of the offer, Air Deccan Managing Director G R Gopinath said.

"We are trying to do it (IPO) in the first quarter of this year... perhaps in March or April... In a week, we will decide on what per cent of stake to be diluted and what should be the size of the issue," he said.

Air Deccan has already appointed JP Morgan, Enam Financial Consultants, ICICI securities and SBI Capital Market as book running lead managers to the issue.

However, he allayed fears that the airline would dilute stake to private players prior to the IPO.

The proceeds of the offer will be used to partly fund the expansion plans.

The airline recently placed an order with Airbus Industries to acquire 30 brand new Airbus A320s at a list price of US 1.5 billion. The airline, at present, has a fleet of 24 Aircraft comprising eight Airbus A320 and ATRs.

Adhunik Metaliks to float IPO by March 2006

Value-added steel manufacturer Adhunik Metaliks would hit the capital market with an IPO by March 2006 to raise funds to part finance the company's expansion plans, report agencies.

Managing Director of Adhunik Metaliks, Manoj Agarwal, said that the company plans to raise Rs 100 crore (Rs 1 billion) from the market, adding that the issue would be made through the 100% book-building route.

Agarwal said that the company is targeting the automobile sector for becoming an original equipment manufacturer, OEM, of auto-grade steel parts for Tata Motors and Mahindra & Mahindra.

He said that the company, which had already procured an iron mine, is also in the process of acquiring a coal mine for which it has applied to the government.

With setting up a 30 MW captive power plant at its plant in Rourkela, Agarwal said that the company would be able to produce at a cost-effective price.

The expansion of the plant would entail enhancing of capacity from 0.2 million tonnes to 0.43 million tonnes.

The company had already filed the draft red herring prospectus with Sebi.

Prime Focus IPO likely to hit market in Feb-March

Prime Focus IPO is likely to hit the market at the end of February or beginning March. The money is to be utilised to go global.

The company is looking to build a strong position in the international markets. It is looking at LA, London and Dubai as markets.

It is looking at overseas acquisitions. It is close to acquiring a couple of companies.

It has said that there is a continuous improvement in the debt of the company.

The company recently filed its DRHP with Sebi for the IPO. It plans to enter the capital market with a public issue of Rs 100 crore (Rs 1 billion) through a 100% book building process.

The company is one of India's leading integrated end-to-end post production and visual effects services house.


Some of the leading corporates and personalities already holding equity stake in the company include Reliance Capital, Adlabs Films, Rakesh Jhunjhunwalla and Manmohan Shetty along with Malhotra family.

The book running lead managers to the issue are Centrum Capital and ICICI Securities. Intime Spectrum Registry is the registrar.

There is also a greenshoe option of Rs 15 crore (Rs 150 million), taking aggregate to Rs 115 crore (Rs 1.15 billion).

It has chalked out an expansion plan involving an investment of Rs 117.25 crore (Rs 1.17 billion).

Sun TV plans pre-IPO preferential allotment

Sun TV is planning to issue preferential allotment of shares to foreign investors before its proposed initial public offering, IPO. The company has not indicated the size of the allotment, but it could even be up to a maximum 20% of the expanded base, reports Indiantelevision.com website.

After the IPO, the dilution of the shareholding will be upto 10%.

"Pursuant to the IPO, there will be a change in the shareholding pattern of the company to the extent of 10% of the post IPO equity capital of the company. To the extent that the equity shares of the company are purchased by foreign shareholders, the foreign shareholding of the company will increase to such extent," Sun said in its application to the Foreign Investment Promotion Board, FIPB.

Sun plans to issue equity shares to foreign investors either by way of a preferential allotment prior to the IPO and/or by an IPO offering of its equity shares of the face value of Rs 10, it has informed the FIPB.

In the event of a preferential allotment to foreign investors, Sun will intimate the FIPB of the "identity of the foreign institutional investors, the number of equity shares proposed to be issued and other details."A copy of Sun's FIPB application is with Indiantelevision.com. According to it, Sun TV has sought FIPB approval for foreign investments up to 20% of the post IPO paid up equity in the company. It has also applied for approval of a preferential allotment and/or an IPO to the maximum extent of 20% of post IPO holding by foreign investors in the company.

According to regulations, Sun will have to stick to the 20% foreign shareholding cap for private FM radio broadcasters.

The company is engaged in the broadcasting of TV and FM radio channels. It also operates a teleport and uplinking hub. Currently, the radio operations in Tirunelveli, Coimbatore and Chennai are run under the Suryan FM brand.

Sun plans to float an IPO in the first half of this year. At present, promoter Kalanithi Maran holds 58,435,000 shares while wife Maillika has 3,565,000 shares. Others hold 155 shares in the company.

Sunil Hitech Engg IPO opens on January 30

Thermal power plant construction major Sunil Hitech Engineers, SHEL, yesterday announced its initial public offer, IPO, of 34,75,000 equity shares of Rs 10 each for cash at a premium of Rs 90 per equity shares at a market price of Rs 100 per share, aggregating Rs 34.75 crore (Rs 347.5 million), report agencies.

The issue, which opens on January 30, will close on February 3.

Retail investor will be able to apply for approximately 17.5 lakh shares and the minimum number of shares one could apply for is 50 shares for Rs 5,000.

The company shares will be listed on Bombay Stock Exchange and National Stock Exchange.

Sunil Hitech is a two-decade-old company headquartered in Nagpur. The company has executed thermal power projects for leading names in the power generation business since it received its first mega order worth Rs 2 crore (Rs 20 million) in 1994 from Bharat Heavy Electrical Corporation, BHEL.

'The company is presently competing with giants like Larsen & Toubro and Simplex while bidding for contracts. It has won eight out of nine contracts where Larsen & Toubro was competing for the project,'' said Managing Director Ratnakar Gutte.

Recently, the company bagged a new contract from Hindustan Steel Works Construction, Bhilai, worth Rs 33.49 crore (Rs 334.9 million).

The company, as on November 30, 2005, has an order book of Rs 285 crore (Rs 2.85 billion) with leading public sector power companies NTPC, BHEL, Maharashtra State Electricity Board, MSEB, Tamil Nadu Electricity Board.

Among the clients in the private sector are Reliance Energy, Jindal Power and multinational companies like Skoda Exports, Shandong Electrical Power Construction Corporation.

Last financial year the company showed an annual turnover of Rs 69 crore (Rs 690 million) and its turnover in the for six month (H1) ended on September 30 last year stood at Rs 59 crore (Rs 590 million).

The offer constitutes 34.66% of the post issue paid up capital; the remaining 65% will remain with the promoters of the company.

The proceeds of the issue will be deployed to meet the incremental long-term working capital requirement and to acquire capital assets for carrying on the existing business.

Centrum Capital is the lead manager to SHEL's issue and will be subscribing to 10,000 equity shares of Rs 10 each at a premium of Rs 90 per share.

Monday, January 16, 2006

Jagran Prakashan to come up with IPO on Jan 25

Media group Jagran Prakashan will bring out an IPO on January 25, report agencies.

The initial public offering, IPO, of 1,15,44,873 equity shares of Rs 10 each, consists of a fresh issue of 1,00,39,020 equity shares and a greenshoe option of upto 15,05,853 equity shares, at a premium to be determined through a 100% book build process.

The price band for the issue of Jagran Prakashan, JPL, has been fixed at Rs 270-324 per equity share of Rs 10 each. The issue will be closed on January 31.

JPL Chairman and Managing Director Mahendra Mohan Gupta said that the present issue is being made to further enhance its printing, publishing capabilities and infrastructure, acquire and invest in print and other media-related businesses in India, expand its outdoor advertising business, augment working capital and meet general corporate purposes.

He said JPL is also amongst the few media companies in the country, which has a strategic foreign direct investment, FDI.

On the occasion, JPL's Editor-cum-CEO Sajay Gupta said their newspaper 'Dainik Jagran' has total readership of 19.2 million readers per day, as per the Indian Readership Survey, IRS, of last year, which is the highest readership of any publication in the history of IRS, he added.

Andhra Bank FPO opened on January 16 for subscription.

Andhra Bank entered the capital market on January 16 with a follow-on public offering, FPO, of 8.5 crore equity shares of face value of Rs 10 each.

Its price band has been fixed at Rs 82-90 per share. The issue will close on January 20.

The government's shareholding would come down from the current 62.5% to 51.55% following the public offering.

SBI Capital Markets and Citigroup Global Markets India are the book running lead managers to the issue. MCS is the registrar to the issue.

The equity shares of the company are proposed to be listed on the BSE, NSE, and HSE.

Bank of Baroda FPO opened on January 16 for subscription.

Bank of Baroda, BoB, entered the capital market on January 16 with its follow-on public offering, FPO, for 7.1 crore equity shares of Rs 10 each.

Its price band has been fixed at Rs 210-230. The issue will close on January 20.

The issue constitutes 19.49% of the total post-issue paid-up capital.

After the follow-on issue, the government’s shareholding would come down to 53.81% from 66.83%.

The proceeds would help the public sector bank to augment its capital to meet the Basel-II norms and grow its assets and investment portfolio.

SBI Capital Markets and DSP Merrill Lynch are the book running lead managers to the issue. Karvy Computershare is the registrar to the issue.

The equity shares of the company are proposed to be listed on the BSE, NSE, and VSE.

Gujarat State Petronet fixes price band for its IPO

Gujarat State Petronet, GSPL, the second largest natural gas transmission network in India, has fixed the price band for its forthcoming initial public offer, IPO, at Rs 23-27 per share, according to a release.

GSPL is entering the capital market with a public issue of 13,80,00,000 equity shares of Rs 10 each for cash at a premium to be decided by the book-building process.

Of the public issue, upto 50% is available for allotment to qualified institutional buyers, QIBs. Of the QIB portion, 5% is available for allotment to mutual funds.

From the balance, 15% of the issue would be available for allotment to non-institutional investors and the remaining 35% for retail investors.

The company, promoted by Gujarat State Petroleum Corporation, currently has 433 km of pipeline network under operation from Hazira to Kalol and has plans to construct additional natural gas transmission pipelines totalling approximately 742 km in length by July 2007.

The other key shareholders of GSPL include Gujarat Maritime Board, Gujarat Urja Vikas Nigam, Gujarat State Electricity Company, Gujarat Narmada Valley Fertilizers Company and Gujarat Industrial Development Corporation.

Amongst the private investors are India Development Fund, a unit scheme of IDFC Infrastructure Fund, which is managed by IDFC Private Equity Company, Infrastructure Development Finance Company of India, Industrial Development Bank of India and UTI Bank.

The book running lead managers to the issue are Kotak Mahindra Capital Company, HSBC Securities & Capital Markets (India) and ICICI Securities.

Dynemic Products IPO opens on January 18

Ahmedabad-based Dynemic Products, engaged in the manufacturing of food colours, lake colours, blended colours and dye intermediate, is entering the capital market with its initial public offer, IPO, to raise Rs 15.47 crore (Rs 154.7 million), reports Business Standard.

The company is issuing 44,21,000 equity shares of Rs 10 each for cash at premium of Rs 25 per share.

Citibank N A has sanctioned a term loan of Rs 2.72 crore (Rs 27.2 million) to part finance the expansion projects.

The public issue opens on January 18 and closes on January 25.

The company is raising the fund to part finance its Rs 18.19 crore (Rs 181.9 million) expansion project for backward integration and expanding the capacities of its two existing units in GIDC Ankaleshwar. The capital expenditure in Unit I and Unit II Plants will be Rs 4.19 crore (Rs 41.9 million) and Rs 13.22 crore (Rs 132.2 million) respectively.

Started in 1991 as manufacturing of dye intermediate used in foods colour industry, it had a turnover of Rs 25.75 crore (Rs 257.5 million) in 2005. The company exports 77% of its products to 41 countries worldwide.

"About 50% of our exports is in Europe, 5% in US and the remaining is in far east and other countries," Bhagwandas K Patel, Chairman and Managing Director of the company said.

He said that in view of the huge potential of the US market, Dynemic has also opened Dynemic USA Inc, a marketing subsidiary in US.

The lead manager to the issue, Centrum Capital, is also investing in the IPO with a lock-in period of one year at the same price offered to the public.

INOX Leisure fixes price band for its IPO

INOX Leisure, which operates a chain of multiplexes at premium locations in 7 cities across India under the 'INOX' brand, has fixed price band at Rs 100-120 per share for its forthcoming initial public offer, IPO, of equity shares as approved by the board of directors of the company on January 12, 2006, according to a release.

The company is entering the capital market with an offer of 1,65,00,000 equity shares of Rs 10 each for cash to be decided through the book-build process.

The offer consists of a fresh issue of 1,20,00,000 equity shares, of which 2,00,000 equity shares are reserved for allotment to permanent employees of the company, and an offer for sale of 45,00,000 equity shares of Rs 10 each by Gujarat Fluorochemicals, the promoter of the company.

The net issue to public, exclusive of the reservation of permanent employees, would be 1,63,00,000 equity shares.

Of the net issue to public, 50% has been reserved for allotment to qualified institutional buyers, of which 5% is reserved for allotment to mutual funds; 15% to non-institutional investors and the balance 35% to retail investors on a proportionate basis.

The issue will constitute 27.17% of the fully diluted post issue paid up capital of the company.

Ventech Solutions plans to issue IPO

In an effort to emerge as a global player in software product development, Ventech Solutions has chalked out plans to acquire two Indian companies, report agencies.

A leading IT services company with offices in the US and Chennai, Ventech solutions has also announced Rs 40 crore (Rs 400 million) expansion plans in India, which will employ over 1,000 IT professionals over the next few years.

"Strategic dialogues are progressing to acquire two companies, one in Chennai and the other in Hyderabad. We will complete the acquisition by first quarter of 2006. The initiative will add USD 5 million to our revenues," said Ravi Kunduru, CEO of the company at a press conference.

The CEO said Ventech had plans to acquire companies in the US also.

With a gross income of Rs 50 crore (Rs 500 million) in 2005, Ventech had finalised strategies to achieve revenues to the tune of Rs 117 crore (Rs 1.17 billion) by 2006 and Rs 450 crore (Rs 4.50 billion) by 2008.

"Apart from our existing facilities in Chennai, we are planning four more development centres in the city. Two of them will be completed by the end of 2007 and the other two by 2008.The initiative will provide employment for over 1,000 IT professionals," Kunduru said.

Ventech Solutions, which had been acknowledged as one of the `top 10 best places to work' in Central Ohio, US by the Business First magazine, has developed nine products in seven different verticals.

Currently the company is focussing on education, banking, insurance, automobile, health care and manufacturing sectors.

Kunduru said Ventech had plans to issue IPO during the third quarter of 2007.

Ventech Solutions plans to issue IPO

In an effort to emerge as a global player in software product development, Ventech Solutions has chalked out plans to acquire two Indian companies, report agencies.

A leading IT services company with offices in the US and Chennai, Ventech solutions has also announced Rs 40 crore (Rs 400 million) expansion plans in India, which will employ over 1,000 IT professionals over the next few years.

"Strategic dialogues are progressing to acquire two companies, one in Chennai and the other in Hyderabad. We will complete the acquisition by first quarter of 2006. The initiative will add USD 5 million to our revenues," said Ravi Kunduru, CEO of the company at a press conference.

The CEO said Ventech had plans to acquire companies in the US also.

With a gross income of Rs 50 crore (Rs 500 million) in 2005, Ventech had finalised strategies to achieve revenues to the tune of Rs 117 crore (Rs 1.17 billion) by 2006 and Rs 450 crore (Rs 4.50 billion) by 2008.

"Apart from our existing facilities in Chennai, we are planning four more development centres in the city. Two of them will be completed by the end of 2007 and the other two by 2008.The initiative will provide employment for over 1,000 IT professionals," Kunduru said.

Ventech Solutions, which had been acknowledged as one of the `top 10 best places to work' in Central Ohio, US by the Business First magazine, has developed nine products in seven different verticals.

Currently the company is focussing on education, banking, insurance, automobile, health care and manufacturing sectors.

Kunduru said Ventech had plans to issue IPO during the third quarter of 2007.

Friday, January 13, 2006

M&M Financial files DRHP with Sebi for 2cr equity shares

Mahindra & Mahindra Financial Services, Mahindra Finance, one of India's leading non-banking finance companies focusing on the rural and semi urban sector providing finance for utility vehicles, tractors and cars and a 89.78% subsidiary of Mahindra & Mahindra, has filed its draft red herring prospectus, DRHP, with the Securities & Exchanges Board of India today, according to a release.

Mahindra Finance proposes to enter the capital market with a public issue of 2 crore equity shares of Rs 10 each, at a price to be decided through the 100% book-building process.

This comprises a fresh issue of 1 crore equity shares of Rs 10 each and an offer for sale of 1 crore equity shares by the selling shareholders.

The issue is being made through the 100% book building process wherein 60% of the issue shall be allocated on a proportionate basis to qualified institutional buyers, QIB, out of which, 5% will be available for allocation to mutual funds registered with Sebi and the remaining QIB portion shall be available to the QIB bidders including mutual funds.

Further, at least 10% of the issue shall be available for allocation on a proportionate basis to non-institutional bidders and at least 30% of the issue shall be available for allocation on a proportionate basis to retail individual bidders.

Mahindra Finance provides loans for the purchase of utility vehicles and tractors manufactured by the parent company Mahindra & Mahindra and for purchase of cars of reputed manufacturers and also pre-owned vehicles.

As of September 30, 2005, Mahindra Finance had 290 branches in 25 states and two Union Territories in India and had entered into 3,91,908 customer contracts. Mahindra Finance has increased its network to areas like Sikkim, Guwahati and other towns of North - East. The company designs tailor made scheme suitable for each product and also to suit the various regions of the country.

The book-running lead managers to the issue are Kotak Mahindra Capital Company and ABN AMRO Securities (India).

The equity shares of the company are proposed to be listed on the BSE and NSE.

Jagran Prakashan fixes price band for its IPO

Jagran Prakashan, JPL, has fixed the price band for its forthcoming initial public offering of equity shares of Rs 10 each at Rs 270-324 per equity share.

JPL, publishers of the largest read Hindi daily newspaper Dainik Jagran, will enter the capital market with a public issue of 1,15,44,873 equity shares of Rs 10 each, comprising of a fresh issue of 1,00,39,020 equity shares, and a greenshoe option of upto 15,05,853 equity shares. The price is to be determined through a 100% book build process.

The public issue will constitute 20% of the fully diluted post-issue equity share capital of JPL assuming that the greenshoe option is not exercised and 22.33% of the post-issue capital of JPL, if the greenshoe option is exercised in full.

The company has appointed DSP Merrill Lynch and ICICI Securities as the book running lead managers for the public issue.

Union Bank public issue by March

The public issue of Union Bank of India is expected to hit capital markets in the fourth quarter itself, said Chairman and Managing Director K Cherian Varghese, at press conference in Kochi on Tuesday, reports Business Standard.


The issue is aimed at shoring up its capital adequacy ratio, CAR, – which stood at 10.5% as on September 30, 2005 - in view of the robust growth in credit and to meet the Basel II norms. Post issue the bank’s CAR is expected to be 12%.

Varghese said that the draft prospectus of the issue had already been filed with the Security and Exchange Board of India, Sebi, and its approval was awaited.

The bank had already received the approval of Bombay Stock Exchange, BSE, and National Stock Exchange, NSE, for the issue.

The Union Bank CMD was hopeful of getting Sebi’s nod and the issue hitting capital markets by March 6.

“The price band would be set according to the market price of the scrip just before the issue date. I can not comment on it at present,” he said.

In 2005, the board of Union Bank had approved the issue of further equity capital of up to 4.50 crore shares by way of a follow on public offering. The issue will be through the book-building route. Union Bank had its public issue in 2002.

He said that post issue government of India’s share holding would come down to 55.43% from the current 60.85%.

Credit offtake of the bank has been increasing at 33%, higher than the industry average of 30%. He said that growth would sustain itself in the current financial and net non-performing assets, NPAs, would be well below the 1.5% level.

“The third quarter results of the bank will be announced in the last week of January,” he added. Bank’s 2065th branch had been opened at Mallappally in Pathanamthitta district of Kerala, which is the bank’s 125th branch in Kerala.

Union Bank has achieved 100% computerisation of branches and 75% of the business is under core banking solution network. It has 434 ATMs at 160 centres.

Visa Steel IPO to hit market in February

Visa Steel IPO is scheduled to hit the market in February. The company yesterday announced an investment of Rs 1,146 crore for its proposed 0.5 million tonne special and stainless steel plant in Orissa.

Unperturbed by the softening of steel prices for almost a year now, Kolkata-based Visa Steel, a part of the Rs 1,600 crore (Rs 16 billion) VISA Group, yesterday announced an investment of Rs 1,146 crore (Rs 11.46 billion) for its proposed 0.5 million tonne special and stainless steel plant in Orissa, report agencies.

The investment of Rs 1,146 crore (Rs 11.46 billion) would be funded in a debt-equity ratio of 65-35, VISA Group Chairman Vishambhar Saran said, adding that the company had already tied up a term loan of Rs 745 crore (Rs 7.45 billion) with various banks.

"The balance of Rs 401 crore (Rs 4.01 billion) will come from internal accruals and additional equity of the group," he said. Visa Steel has also approached market regulator Sebi for an initial public offer to sell 35 million shares of face value of Rs 10.

Visa Steel project of 0.5 million tonne special and stainless steel is expected to go on stream by 2007.

"We have already grounded an investment to the tune of Rs 252 crore (Rs 2.52 billion) at our plant in Kalinganagar, Orissa, in Blast Furnace and Coke Oven Batteries," he said.

The integrated steel and stainless steel plant in Orissa will have features of coke ovens and ferro chrome furnace.

Expressing confidence that the company would not be affected by the slump in steel sector, the VISA Group Chairman said: "Our production cost will be low as the company enjoys a strategic advantage of being close to all raw materials, port and railway network."

And the company would capture 25% of Indian stainless steel segment soon after it starts commercial production, he said.

It has appointed Enam Financial Consultants and JM Morgan Stanley for the IPO which is scheduled to hit the market in the first half of February.

The company had filed the draft prospectus with Sebi on January 2. Taking into account, the three-week period that Sebi will take to give its approval and another week for clarifications, the company may hit the market in February.

'We are among three to four companies, which are in stainless steel segment. Since all other companies are away from these strategic advantage we are not worried about the consumption of the product,' Saran said.
On the future prospects of steel in India, he said the company would be manufacturing only long products like rods and wires, which are always in a short supply in the market.

Elaborating the strategy to consolidate the business, he said: 'The sale of coke and chrome from the facility would add strength to the venture. While we aim to earn Rs 200 crore (Rs 2 billion) from sale of coke, the chrome marketing is expected to give us additional Rs 150 crore (Rs 1.50 billion) annually.'

The VISA Chairman added that for the Orissa project, the company targeted to import 4 lakh tonne coke, of which only 1.5 to 2 lakh tonnes would be consumed in the plant.

'Rest two lakh tonnes of coke will be up for sale in open market,' he said.

He informed that the company was close to be awarded a 65 to 70 million tonne iron ore reserve for the integrated steel plant project.

Icra plans to float IPO

Icra, the country’s second largest rating agency, is drawing up plans for its initial public offer, IPO. After Crisil, Icra would become the second rating agency to get listed, reports Business Standard.

The proposed IPO is likely to be a combination of fresh issue of shares and offer for sale by one of its shareholders, the Specified Undertaking of Unit Trust of India, SUUTI. SUUTI holds about 7% stake in Icra.

“Nothing has yet been finalised. Various options are being explored,” said a source familiar with the development.

Managing Director PK Chowdury said there could be some preliminary discussion (on the proposed IPO) but he had no knowledge of the development.

Sources said the stake holders have initiated preliminary talks on the IPO and the finance ministry was aware of this. Global rating agency Moody’s Investors Service is the largest shareholder in Icra.

Crisil, the first Indian rating agency launched by domestic financial institutions and banks, was last year acquired by US-based international rating agency Standard & Poor’s.

“It’s a complex issue as the government may not like both the country’s premier rating agencies to be managed by global entities. Once Icra gets listed, it will not be difficult for Moody’s to acquire a majority stake by making an open offer in due course,” said an industry analyst.

State Bank of India, Life Insurance Corporation of India, Punjab National Bank, General Insurance Corporation of India, Central Bank of India, Allahabad Bank, Indian Bank, Canara Bank, UCO Bank, Andhra Bank and Oriental Bank of Commerce hold stakes in Icra.

In addition to rating services, ICRA provides information, grading and research services, advisory services, economic research and outsourcing.

SUUTI, which holds equity stakes in various entities, has set March 31, 2006 as the deadline for selling all its investments including its holding in Icra. Sources said there could be a delay in divesting the SUUTI stake in Icra as the rating agency is planning to combined this with an IPO.

In 1999, Moody’s and Icra had announced the final agreement for the global rating agency to make the initial equity investment and provide technical services to Icra.

Moody’s Investment Company India acquired an additional 9% stake in Icra in September 2001 to become the largest shareholder.

Telsima plans of entering capital market with an IPO

Telsima Corporation, a telecom equipment manufacturer, has plans of entering the capital market with an IPO in the next four years. The company yesterday announced the launch of its manufacturing operations in India with an initial investment of USD 20 million.

Focussing on providing broadband wireless access solutions specially designed for the Indian telecom sector, Telsima has plans to garner 50% of its sales from the country.

With Intel Capital, JAFCO, CMEA being some of the leading global players investing in the company, located at Santa Clara, California Telsima also plans to significantly expand its sales and support centre in Gurgaon, Haryana by April 2006.

''Our aim is to provide next generation wireless and broadband solutions and also provide end-to-end networking solutions for emerging markets like India which is poised for a quantum growth in the near future,'' Telsima President and CEO Alok Sharma said.

With a rising demand for affordable broadband services in the country, the company will have on offer cost-effective telecom equipment solutions and primary broadband internet access at affordable prices.

Given that the Indian telecom segment is growing at a rapid pace with tele-density registering a jump of 11% last year, the company has adopted the use of WiMax-based solutions that would enable operators to deploy non-line-of-sight broadband wireless services in dense urban, suburban and rural environments in India.

''Tele density in India has grown rapidly, but broadband penetration still lags behind that of comparable emerging economies like China. We expect broadband connections in the country to rapidly grow to over 20 million by 2010. India is potentially the largest market for WiMAX as a primary access mechanism for broadband access. It is this market we are hoping to tap with a complete product portfolio in telecom equipment and services,'' Telsima Vice President (Worldwide Sales) Ruchir Godura said.

The telecom equipment manufacturer would also offer voice compression products for mobile networks and has plans of entering the capital market with an IPO in the next four years.

Saturday, January 07, 2006

Global Trade Fin hopes to become a bank; IPO in the offing

Exim Bank of India-promoted Global Trade Finance, GTF, hopes to convert into a bank, but not in the near future. "That is our ultimate objective," Arvind Sonmale, Managing Director and Chief Executive Officer, said. But a near-term objective is to prepare for an initial public offering, IPO, reports The Hindu Business Line.

GTF, a non-deposit taking non-banking finance company, NBFC, is into factoring and forfaiting services (which are essentially bill discounting, but with some technical differences.)

40% of its Rs 81 crore (Rs 810 million) equity capital is held by Exim Bank of India. FIM Bank of Malta (formerly, First International Merchant Bank) holds 38.5%, IFC, Washington, and Bank of Maharashtra hold 12% and 9% respectively.

Because its booming business needs capital and because of its commitment to IFC, Washington, the company proposes to come out with a public issue. The IPO could hit the market in 2007, Sonmale said.

Last year, GTF's disbursements (receivables discounted) amounted to Rs 2,000 crore (Rs 20 billion), of which about Rs 700 crore (Rs 7 billion) were for overseas receivables. Also, last year's business was 136% higher than the previous year's. In the current year, disbursements are expected to cross the Rs 3,000 crore (Rs 30 billion) mark.

Similarly, profit moved up from Rs 3.5 crore (Rs 35 million) in 2003-04 to Rs 10 crore (Rs 100 million) in the following year and is expected to be not less than Rs 15 crore (Rs 150 million) this year.

Andhra Bank eyes Rs 850cr via float

Andhra Bank will hit the capital market with its follow-on public issue of 8.5 crore fresh shares to raise around Rs 850 crore (Rs 8.50 billion) to fund its growth, reports Business Standard.

Andhra Bank shares closed at Rs 103.45 on the National Stock Exchange, NSE, yesterday, up 8.38% from previous day’s close.

The government’s stake in the bank after the issue will drop to 51.55% from the current 62.5%.

Andhra Bank will join several other public sector banks, wherein the government stake has almost reached the floor of 51%, which puts an end to further capital raising through issue of equity shares.

The public issue of equity shares through book building opens on January 16 and closes on January 20.

The bank’s capital adequacy ratio is currently at 11.95% and the fresh issue will provide it more headroom to raise tier-II capital through issue of subordinated bonds, Chairman, K Ramakrishnan said.

The issue size constitutes 17.53% of the post-issue fully diluted equity capital.

Ramakrishnan said though bank has maximum branches in Andhra Pradesh, it was not just a South-based bank. It has presence in top 200 business centres except Bihar, Jharkhand and North Eastern region.

The bank would open more branches, install onsite and offsite ATMs to expand business and reach. The bank would also open an office in Dubai, he said.
Its ratio of net non-performing assets to net advances declined to 0.28% as at March 31, 2005 from 0.93% as at March 31, 2004. The ratio of net NPAs to net advances as on September 30, 2005 is 0.26%.

Radio Mirchi bids for seven cities

The government today will be holding the second round of bidding for FM frequencies in 13 cities. CEO at Radio Mirchi, AP Parigi, says that Radio Mirchi has bid for seven cities and these seven cities are virgin territories for the company.

Gitanjali Gems fixes price band for its IPO

The proposed initial public offering of Gitanjali Gems is to be priced in the band of Rs 210-250 per share, reports The Hindu Business Line.

Gitanjali Gems, manufacturers and retailers of diamond and gold jewellery in India, is entering the capital market with an IPO of 1.7 crore shares of Rs 10 each in a 100 % book built issue. The issue will constitute 28.81 % of the fully diluted post-issue capital of the company.

ICICI Securities and Keynote Corporate Services are book-running lead managers for the issue.

Post-IPO, the promoters' holding would be around 70%. Members of the Choksi family are promoters of the company.

According to Mehul Choksi, Chairman, Gitanjali Group, the Indian branded jewellery market is on a trajectory of growth evolving towards brands and fashion trends.

While the overall jewellery market is growing at 10-20% compound annual growth rate, CAGR, the branded jewellery market is growing at 50%, Choksi said.

Gitanjali Gems is planning expansions to capture the growth and for this, it is entering the capital market with an initial public offering. The expansion plan involves an investment of more than Rs 300 crore (Rs 3 billion).

Zenith Birla to raise Rs 125cr via public issue

Zenith Birla India has informed BSE that the company board has approved the draft red herring prospectus to be filed with Sebi and BSE for raising upto Rs 125 crore (Rs 1.25 billion) by issuing fresh equity shares.

The company said it would be submitting the revised draft prospectus after incorporating the financial results up to September 30, 2005.

Solar Explosives to tap market via IPO

Nagpur-based Solar Explosives plans to moblise funds from the capital market by issuing 44 lakh equity shares of Rs 10 each through book building process to fund the company's expansion at home and abroad, report agencies.

The company said it had filed the prospects with Sebi on December 29 for the initial public offer, IPO.

Solar Explosives, with an installed capacity of 80,000 MT of explosives and 5 crore detonators per year, recorded a consolidated turnover of Rs 72.36 crore (Rs 723.6 million) and profit after tax of Rs 11.44 crore (Rs 114.4 million) for the half-year ended September 30, 2005, it added.

Sree Sakthi Paper Mills IPO opens on Jan 17

Sree Sakthi Paper Mills, engaged in the manufacturing of kraft paper and duplex board, is entering the capital market on January 17, 2006 with an IPO of 83,33,340 equity shares of Rs 10 each for cash at a premium of Rs 20 per share (issue price Rs 30 per share) aggregating Rs 25 crore (Rs 250 million), according to a release.

The issue price is 3 times the face value of the equity share. The issue closes on January 21, 2006.

Out of this public issue, 8,33,340 equity shares are reserved for allotment to NRI's and FIIs and 8,33,340 equity shares are reserved for allotment to banks, mutual funds and financial institutions, leaving a net issue to the public of 66,66,672 equity shares.

Keynote Corporate Services is the lead manager to the issue and Bigshare Services is the registrar.

The company is coming out with this issue mainly to fund its plans for expansion of the capacity from 140 TPD to 240 TPD and also to set up a 2 MW cogeneration power plant with an investment of Rs 26.55 crore (Rs 265.5 million).

The company's performance during past 5 years shows that its total income has gone up from Rs 36.65 crore (Rs 366.5 million) in 2000-01 to Rs 50.55 crore (Rs 505.5 million) in 2004-05 and profit before adjustments has jumped from Rs 16.51 lakh to Rs 1.09 crore (Rs 10.9 million) during the corresponding period. For the six month ended September 30, 2005, the total income of the company was Rs 31.12 crore (Rs 311.2 million) and PAT of Rs 84.31 lakh.

Sree Sakthi Paper Mills, SSPML, was incorporated in the year 1991 with an installed capacity to produce 15 tonnes of kraft paper per day. It graduated to a combined manufacturing capacity of 140 TPD of kraft paper and duplex board at two of its plants in Edyar and Chalakudy in Kerala. Both the plants are capable of producing together 40,000 MT per annum as on date.

SSPML is now planning to expand its activities by enhancing its capacity of kraft paper to meet growing demand from its customers and to emerge as one of the bigger players in South India.

Thursday, January 05, 2006

Uma Precision IPO in April; to fund Rs 50cr expansion

Pune-based Uma Precision is to come out with an initial public offering in April to fund its Rs 50 crore (Rs 500 million) expansion plan, reports The Hindu Business Line.

Uma Precision, a manufacturer and exporter of precision assemblies, systems and machine parts for the auto and electrical industries, is also in the process of setting up a surface treatment facility at Ranjangaon near Pune, according to Rajendra Z Kankaria, Managing Director and Chief Executive Officer, Uma Precision.

Of the Rs 50 crore (Rs 500 million), Rs 40 crore (Rs 400 million) is expected to come from the IPO and Rs 5 crore (Rs 50 million) from internal accruals and the remaining would come from financial institutions, Kankaria said.

The Ranjangaon facility, which is being planned for captive use, would be spread over 50,000 sq ft area and would have an investment of about Rs 10 crore (Rs 100 million). The facility is expected to be operational by December, he said.

The company would be implementing a metal injection-moulding project with technical collaboration with an US company and hopes to achieve a turnover of Rs 30 crore (Rs 300 million) from this segment in the next fiscal.

On acquisition plans, Kankaria said the company in the process of completing the formalities for acquiring a Bangalore-based firm. He said with this, the company, which has so long been handling single spindle process, would now add on the multi-spindle process in which the Bangalore company specialises.

"This would help us compete globally and as both the companies are in the similar product category, it would help us with large volumes,'' he said.

He said the company would have in its facility about 10 multi-spindles before March 2006. Currently, about 10 million products are being churned out every month and this is expected to increase to 15 million products every month.

Kankaria said the company is also looking at acquisitions in the US and talks have already begun with about three companies. These acquisitions are expected to be completed by March. The acquisitions would help the company set up its subsidiary in that country.

Kankaria said Uma Precision had closed March 2005 with a turnover of Rs 65 crore (Rs 650 million) of which about Rs 7 crore (Rs 70 million) had come from exports. The company exports its products to Lucy Switchgear (about 400 products) in Dubai and to Multitech in the US.

Kingfisher Airlines close to equity deal

Kingfisher Airlines is close to taking on board a slew of leading private equity investors to fund its ambitious growth plans, reports DNA.

ICICI Ventures, Temasek and NewBridge are said to be among those in the race for an equity stake in the seven-month-old airline.

Vijay Mallya, the promoter of Kingfisher Airlines, is believed to be conducting a beauty parade to enlist long term investors.

“We are in talks with many private equity firms and venture capitalists, but nothing has been finalised as yet,” said Mallya.

When asked whether the three investment firms were among those he is in talks with he said, “Some are. Some aren’t.”

About USD 200 million is the size of the investment the airline is looking at from the equity investors, with the minimum deal size pegged at USD 30 million. The airline is eyeing a rapid increase in market share by bidding for Air Sahara, which has the license to fly abroad.

It is learnt that Mallya may give 26% to the private equity partners. Unlike, other airlines Kingfisher boasts of being the highest capitalised airline with about Rs 197 crore (Rs 1.97 billion) as paid-up equity capital.

The entire sum was raised through the UB group’s holding companies.

Air India defers IPO launch to Q2 of ’07

The IPO of Air India, AI, which was scheduled to be launched this financial year, has now been put off till the second quarter of ’06-07. Merchant bankers were appointed in August and the government had hoped to push ahead with a divestment of upto 20% of its stake in the flag carrier by the end of this financial year, reports The Economic Times.

The ambitious fleet acquisition plan of the airline was to be partly funded by the IPO proceeds. However, sources say, the airline is still in the process of preparing itself and the IPO documentation is far from complete.

The AI management has also yet to conclude the long-pending wage agreement with several of its unions. The last agreement expired in 1996 and the airline has a liability of Rs 100 crore (Rs 1 billion) per annum in terms of the wage backlog. This amounts to a total liability of about Rs 900 crore (Rs 9 billion), which will surely impact the airline’s valuation, the sources said. In addition, the airline has also been slapped a Rs 100 crore (Rs 1 billion) notice by the labour commissioner in a case of payments to its aircraft maintenance engineers. AI officials said they have appealed against the judgment in the Bombay High Court and hope to win the case. The airline has also been making provisions in its balance sheet for wage increments every year, they added.

Wage agreements have been concluded with two of the airline’s largest unions, the Air India Emloyees Union and the Employees Guild, which account for 9,000 of its 15,000 workforce. However, the airline management has yet to settle with the other unions, including those representing the high-income categories like the pilots, cabin-crew, engineers and officers.

AI officials also said the government has yet to clear the IPO, though cabinet clearance was earlier obtained for the appointment of the merchant bankers. Meanwhile, the airline in the last week of December signed up with Boeing to buy 68 aircraft.

The funding is being kicked off with a USD 429 million bridge loan towards advance payment for 22 of aircraft. Two tenders inviting bids from banks have been floated already, airline sources said. The loan will meet about 15% of the total cost of the fleet acquisition, while the remaining will be on the bank guarantee from the Exim Bank.

Gangotri Textiles to go public

Coimbatore-based Gangotri Textiles, a player in the men’s wear segment, plans to increase its authorised capital from Rs 10 crore (Rs 100 million) to Rs 25 crore (Rs 250 million) through an issue of securities in the form of public offering. The company plans to enter the capital market in a month’s time, according to a company official - reports Business Standard.

The resources would be used to finance its expansion plans to enter the eastern market with its brand ‘Tibre’. The company is also planning to increase its production capacity four-fold from the present 1,000 pieces per day.

Gangotri Textiles has informed BSE that the members, at the 16th annual general meeting of the company, held on September 24, 2005, have decided for the declaration of dividend at Rs 3 per share on equity shares of Rs 10 each for the year ended March 31, 2005.

The board authorised the company to borrow from time to time, any sum or sums of money, with or without security and upon such terms and conditions as they may think fit, notwithstanding that the monies to be borrowed together with the monies already borrowed by the company (apart from temporary loans obtained from the company’s bankers in the ordinary course of business) may exceed the aggregate of the paid-up capital of the company and its free reserves that is to say, reserves not set apart for any specific purposes provided however, that the total amount so borrowed by the board of directors shall not exceed a sum of Rs 500 crore (Rs 5 billion) at any one time.

The board has also approved stock splitting and it has been decided to split all the existing 48,00,000 equity shares of Rs 10 each into two equity shares of Rs 5 each and by allotment of shares of face value of Rs 5 each equivalent to the holding each one of the member of the company may have, as on a date, to be notified by the board of directors in this regard.

The other items considered in the AGM were to issue and allot equity shares or share warrants convertible into equity shares, to any persons, whether or not such persons are shareholders of the company, at such premium as the board may decide for an aggregate sum not exceeding Rs 75 crore (Rs 750 million) including the premium amount.

Sree Sakthi Paper Plans to raise Rs 25cr from IPO

Sree Sakthi Paper Mills is coming out with an IPO of 83 lakh shares. MD at Sree Sakthi Paper Mills, S Rajkumar says that the company is planning to raise around Rs 25 crore.

The money will be used for a capacity increase by 100 tonnes. The company is also looking at a co-generation project for reducing costs and for repaying high cost debt

DS Kulkarni Developers plans to raise Rs 150cr by March

DS Kulkarni Developers, DSKDL, a Rs 800 crore (Rs 8 billion) business conglomerate based in Pune, is planning to raise Rs 150 crore (Rs 1.50 billion) from the market by March this year for further expansion of its diversified business interests across the globe, report agencies.

Announcing his plan to raise the additional funds either through a rights issue or via the route of initial public offerings, IPO, Chairman and Managing Director, DSKDL, DS Kulkarni yesterday said their diversified business activities comprised real estate development, construction, information technology, automobile trading engineering, hospitality, logistics and education.

Though majority of DSKDL's business activities circled around construction and real estate development, the company also took active interest in further developing business in other areas too, Kulkarni emphasised.

He said with the construction business booming worldwide DSKDL had acquired large chunk of lands not only in Mumbai, Pune, Hyderabad, Bangalore, but also in the Middle East and the USA for developing multi storied residential complexes for the large "migrating population". In fact, DSKDL was the first Indian real estate developer working in the USA in such a big way, Kulkarni informed.

Currently the amount of DSKDL's real estate business was to the tune of Rs 600 crore (Rs 6 billion) and the figure was all set to cross the Rs 1000 crore (Rs 10 billion) mark by March 2007 with the construction work of huge residential complexes going on in different cities both within the country and abroad.

About other areas of business of the company which had been listed in both the BSE and the NSE, Kulkarni said besides owning a number of Japanese automobile showrooms in different parts of Maharashtra, Karnataka, Tamil Nadu, Delhi and Haryana with a total business volume crossing Rs 300 crore (Rs 3 billion) mark per annum till last year, DSKDL also had enough exposure in IT and hospitality businesses among others.

Last year these two sectors accounted for an annual business turnover of Rs 40 crore (Rs 400 million) and Rs 75 crore (Rs 750 million) respectively with a growth potential of around 20% to 25% each, Kulkarni said.

Asked to elaborate his plan on how to utilise the additional fund (Rs 150 crore), Kulkarni except saying that it would have about 1.50 crore shares, refused to say more because of the Sebi guidelines but indicated that a portion might go for exploring a new business opportunity in Eastern India.

Though at present DSKDL does not have any existence in West Bengal or in any of the Eastern and Northeastern states, the company does not rule out any major venture here soon, the compnay CMD said replying to a related query.

Wednesday, January 04, 2006

Royal Orchid IPO to open on Jan 12

The Bangalore-based Royal Orchid group will enter the capital markets on January 12 with an IPO of 68.20 lakh shares of Rs 10 each through the book-building process. The issue closes on January 17 and the price band has been fixed at Rs 150-Rs 165 per equity share of Rs 10 each, reports Business Standard.

The group, which acquired the Dominion Club on Bellary Road recently, plans to position it as a convention centre.

Addressing a press conference yesterday to announce company’s initial public offer, IPO, Chairman and Managing Director of the Royal Orchid group, Chander Baljee, said, “The club has 50 rooms on eight acres of land. We plan to position it as a convention centre by investing substantially and it will be ready in a year’s time.”

In its four hotels in Bangalore and Mysore, Royal Orchid Hotels offers 435 rooms. The company through joint ventures is also planning to open a 100 bed hotel in Pune’s Kalyani Nagar and a 72 room hotel at Banjara Hills, Hyderabad by October 2006.

For the issue, ICICI Securities and SBI Capital Markets are the book running lead managers while MCS is the registrar to the issue.

The company proposes to use the proceeds of the IPO for expansion and renovation of its existing properties. “For expansion Rs 75 crore (Rs 750 million) has been earmarked and the balance for renovation of properties in Bangalore and furnishing the Pune and Hyderabad hotels,” said Baljee.

The plan also includes capital expenditure for operating the hotel in Pune under long term lease, investing in the subsidiary Royal Orchid Hyderabd which will operate a hotel in Hyderabad on long term lease, and purchase of 51% equity capital in Maruti Comforts and Inn.

During the financial year 2004-05, the group’s revenue was Rs 57.63 crore (Rs 576.3 million).

Tuesday, January 03, 2006

Visa Steel files DRHP with Sebi for book-built IPO

Visa Steel a part of the Rs 1,600 crore (Rs 16 billion) VISA Group filed its draft red herring prospectus, DRHP, with the Securities & Exchange Board of India, Sebi, to enter the capital market with an issue of 3,50,00,000 equity shares of Rs 10 each for cash at premium to be decided through book building process, according to a release.

The issue comprises of promoters' contribution of 50,00,000 equity shares and the net issue to public will be 3,00,00,000 equity shares.

Upto 50% of the net issue to public shall be available for allocation to qualified institutional buyers, QIBs, on a proportionate basis, of which 5% shall be reserved for allotment to mutual funds. Not less than 15% of the net issue to public shall be available for allocation on a proportionate basis to non-institutional investors and not less than 35% of the net issue to public shall be available for allocation on a proportionate basis to retail individual investors.

The net issue to public would constitute 27.27% of the post issue paid up equity capital of the company.

The proceeds of the issue shall be utilised to finance a part of the capital expenditure for Brownfield expansion of existing manufacturing activities into an integrated 0.5 million TPA Special and Stainless Steel plant at Kalinganagar Industrial Complex, Orissa.

This Brownfield expansion includes setting up a 50,000 TPA Ferro Chrome Plant, 300,000 TPA Sponge Iron Plant, 50 MW Waste Heat Recovery Power Plant and 500,000 TPA Special and Stainless Steel Plant.

The company is currently operating a Blast Furnace with production capacity of 225,000 TPA of Pig Iron and a Chrome Ore Beneficiation Plant and a Chrome Ore Grinding Plant with capacity of 100,000 TPA each. A 400,000 TPA Stamp-Charged Heat-Recovery Coke Oven Plant is currently under implementation.

The book running lead managers to the issue are Enam Financial Consultants and JM Morgan Stanley.

Raj Rayon fixes opening & closing date for FPO

Raj Rayon has informed BSE that the proposed 100% book building public issue of 85,00,000 equity shares of Rs 10 each for cash at a price of Rs 55 per equity share at the lower end and Rs 65 per equity share at the higher end is decided to be open and close as under:
Bid/Issue opens on: January 12, 2006.
Bid/Issue closes on: January 18, 2006.

Nitin Spinners IPO opens on Jan 6

Nitin Spinners, a 100% EOU, proposes to enter the capital market on January 06, 2006 with an issue of Rs 49 crore (Rs 490 million) through book building process, according to a release.

The issue closes on January 12, 2006. The price band has been fixed at Rs 18- 21 per equity share of Rs 10 each.

Out of the total issue size of Rs 49 crore (Rs 490 million), Rs 9 crore (Rs 90 million) is the promoters contribution. There is a reservation for the permanent employees of the company for cash aggregating Rs 2.50 crore (Rs 25 million) and net issue to public is Rs 37.50 crore (Rs 375 million).

The company is implementing a project of Rs 150 crore (Rs 1.50 billion), which is appraised by Industrial Development Bank of India, IDBI. The means of finance includes Rupee Term Loans aggregating Rs 83.50 crore (Rs 835 million) sanctioned by IDBI, Oriental Bank of Commerce, Punjab National Bank, Indian Overseas Bank and The Bank of Rajasthan; internal accruals aggregating Rs 15 crore (Rs 150 million) and unsecured loans from promoters aggregating Rs 2.50 crore (Rs 25 million).

Nitin Spinners, a Bhilwara (Rajasthan) based textile company is engaged in manufacturing of combed and carded cotton yarns ranging from Ne 4 to 40 in single and multifold and knitted fabrics. These yarns are suitable for applications such as apparels, undergarments, terry towels, denims, medical fabrics, furnishing fabrics and industrial fabrics.

The company is exporting cotton yarns and knitted fabrics to countries like Australia, Bahrain, China, Colombia, Egypt, Israel, Italy, Korea, Mauritius, Russia, Poland, UK, USA and others. At present, its exports are restricted to around 18-20 countries only, which leaves more scope for company to develop new markets and to increase presence accordingly.

The company is promoted by R L Nolkha and his two sons Dinesh Nolkha and Nitin Nolakha.

The total income of the company has jumped from Rs 60.50 crore (Rs 605 million) in 2002-03 to Rs 81.74 crore (Rs 817.4 million) in 2004-05 and the net profit during the same period has gone up from Rs 1.21 crore (Rs 12.1 million) to Rs 2.88 crore (Rs 28.8 million). During the first half ended September 30, 2005 the total income was Rs 49.67 crore (Rs 496.7 million) against a net profit of Rs 3 crore (30 million).

UTI Securities is the book running lead manager to the issue and IDBI Capital Market Services is the co-book running lead manager to the issue. Bigshare Services is the registrar to the issue.

The equity shares of the company are proposed to be listed on Bombay Stock Exchange and National Stock Exchange of India.

Nitco Tiles files DRHP with Sebi for IPO of 1cr shares

Tile manufacturer Nitco Tiles has filed its draft red herring prospectus, DRHP, with the Securities and Exchange Board of India, Sebi, for a initial public offer, IPO, of one crore shares, reports The Hindu Business Line.

The premium price for the shares of Rs 10 each for cash will be determined through a 100% book-building process, the company said in a release.

"The funds from the IPO will be used to expand our existing manufacturing facilities of ceramic floor tiles and enter into wall tiles segment by setting up a green-field project or by acquiring existing manufacturing wall tile unit," Nitco Tiles Managing Director, Vivek Talwar said.

We also plan to install windmills with a view to reduce power costs, he added.

The company has appointed UTI Bank, IL&FS Investmart and Karvy Investor Services as the book running lead managers to the issue, the release added.

Monday, January 02, 2006

Sejal Float Glass IPO by mid-2006

Sejal Float Glass is setting up a 550 tonne float glass manufacturing plant in Gujarat at a cost of Rs 500 crore (Rs 5 billion), reports Business Standard.

The plant will make use of European technology and import machinery from Germany, France and Italy. It will begin operations by the end of 2007. The company plans to enter the capital market by the middle of 2006 to part finance the project.

Sejal Architectural Glass, the flagship of the Sejal Group, is also undertaking expansion of its Silvassa plant at a cost of Rs 25 crore (Rs 250 million). It is expected to be completed by March 2006. The expansion will increase the plant’s capacity by more than three times to 4,500 sq metre of glass per day.

Amrut S Gada, Chairman and Managing Director of the Sejal Group, said the group’s turnover was expected to be Rs 100 crore (Rs 1 billion) for the current financial year.

On the completion of its expansion, the company will post turnover to the tune of Rs 1,000 crore (Rs 10 billion) in another five years. The group has offices in Mumbai, Pune, Ahmedabad, Delhi, Kolkata, Hyderabad, Bangalore and Chennai.

The Sejal Group plans to start overseas offices in Singapore and Dubai shortly.

Cos seek insurance cover for public offerings

With the growing interest of FIIs in domestic equity market, several companies going for public issues are opting for a new insurance cover, which would serve as a safeguard against any legal suit for wrong information in the public offer documents, reports The Hindu Business Line.

The insurance cover called `Public Offerings of Securities Insurance, POSI,' also covers claims by the underwriter of the issue.

Some of the companies, which have recently opted for this cover in the country include Jet Airways, Suzlon, NTPC, Punj Lloyd and Sasken Technologies. All these companies raised the money in domestic market.

POSI covers the wrongful acts of a company and its directors arising from the issue of a prospectus. If a company or its directors provide wrong information in the offer documents, the shareholders can file legal suits. Insurance would cover the legal costs incurred in defending civil and criminal proceedings relating to prospectus liability.

The cover also includes claims made by the underwriter or sponsor of the issue, which could arise due to warranties and indemnities given by the company or the directors personally in the agreement with the sponsor.

"The limit of the insurance cover depends on the risk perception of the company, the size of the issue, the business the company is involved in and the route through which capital is being raised," said Praveen Vashishta, CEO, Managing Director, Howden India.

Howden India, an arm of Howden UK, is one of the providers of this specialised liability insurance cover in India.

Vashishta said the cover purchased in India could be in the range of USD 10 million to USD 120 million. If a company were going for an ADR issue, exposures to US Securities Laws would attract a higher risk rating and subsequently a higher premium. The cost of the cover is usually 2-4% of the limit of indemnity required.

He said the cover is usually purchased for three years and for a single premium payment and is underwritten by a select group of underwriters at Lloyds and major London Market Insurance Companies.

According to the research done by Howden globally, the allegations that have translated to highest average settlement include "Directors and Officers making false revenue disclosures which require reinstatement (USD144 million)" and "Improper accounting practices (USD 115 million)".

Vashishta said that while in the US and Europe the main source of claims (40%) under liability insurance is shareholders' action, in South-East Asia and India, it is regulatory action that is mainly the cause.

In India, liability insurance accounts for just 3% of the total non-life premium. This segment generates an annual premium of around USD 80 million. In the US, however, liability insurance accounts for 70% of the non-life premium.

Maxwell Industries to raise Rs 275cr

Maxwell Industries, the flagship company of VIP group, plans to raise around Rs 275 crore (Rs 2.75 billion) through an issue of securities, by public or private offering, in the form of bonds or equity shares, reports Business Standard.

In a press statement, L J Reddy, Managing Director, Maxwell Industries, said, “These resources, raised by the company, will be used to finance its expansion plans, which include doubling the present capacity of its spinning and processing mills, garmenting and marketing with distribution and retail models.”

In addition, the board of directors of the company has approved the issue of bonus shares in the proportion of three bonus equity shares for every four existing equity shares of the company. The bonus shares will increase the company’s capital from Rs 6.16 crore (Rs 61.6 million) to Rs 10.78 crore (Rs 107.8 million).

The existing one equity share of Rs 10 each will be split into five equity shares of Rs 2 each. The board has approved the issue of bonus shares in the proportion of three bonus equity shares for every four existing equity shares of the company.

The board of directors approved the acquisition of related sister concerns in order to integrate all activities under the flagship. Valuation was accepted for HyboHindustan at Rs 6.75 crore (Rs 67.5 million) and Gomma Industries at Rs 17.81 crore (Rs 178.1 million).

In order to discharge the consideration for acquisition of these businesses, the board approved the issue of 24,35,000, 5% cumulative preference shares of Rs 100 each, redeemable at the option of the company. The aggregate amount of preference shares is Rs 24.35 crore (Rs 243.5 million).

AB Corp plans to raise Rs 200cr from market

The year ’06 could well see one of India’s biggest brands stepping into the capital market. Plans are on to list Amitabh Bachchan Corporation (better known as AB Corp), the firm that has mirrored the ups and downs of its founder, reports The Economic Times.

More than a decade ago, the Big B had embarked on a dream to establish a professionally run company in the film industry. But somewhere along the way, AB Corp encountered a spate of problems, forcing the superstar to consign his ambitious proposals to the cold storage.

But once again, things have livened up, with Bachchan drawing the contours to fulfil that dream. However, when contacted, Bachchan’s spokesperson refused to comment.

According to industry sources, Bachchan has taken up the task of listing AB Corp on the Indian stock exchanges. The plan is to raise close to Rs 200 crore (Rs 2 billion) from the market for a significant expansion programme, which includes setting up multiplexes, a film processing unit and other normal film production activities.

The listing plan could have been prompted by the success of other firms associated with the film industry, the most recent being PVR, which tapped the primary market.

Sources close to the development said that just before his recent hospitalisation, there was a meeting with investment banks, KJMC Global Markets, ICICI Securities and Yes Bank to examine the possibility. It is expected that AB Corp may resume discussion on the plan once Bachchan fully recovers.

The discussion was only preliminary and no mandate has been given to any merchant banker. Besides, Amitabh Bachchan and Jaya Bachchan, HFCL promoter Vinay Maloo also holds around 30% equity in AB Corp.

According to sources, Bachchan has lined up projects and has bagged more roles and endorsements more than any actor in the trade. He had relaunched ABCL with a new name AB Corp in ’03. To spread the risk and minimise the investment burden, Bachchan had said that the strategy for AB Corp for the near term would be to undertake film projects as joint ventures with other film and investment groups.

ABCL which was earlier a sick company, no longer has the baggage of its old debt. The accumulated debt of Rs 90 crore (Rs 900 million) has been cleared. The major portion of the debt was owed to Prasar Bharti, several FIs, banks and to some private parties.

The repayment was done by the superstar from the earnings generated from films, KBC - the successful TV show that he anchors, acting assignments and product endorsements.

ABCL was originally formed in 1987, after merging Sopan Leasing, a subsidiary of Tansi Investments owned by Amitabh, Jaya and Amitabh’s brother, Ajitabh Bachchan. However, the company existed only on paper till 1994.