Indian IPO

All details about Hot Indian Primary Market.

Friday, September 29, 2006

DCB IPO opens today for bids with price band of Rs 22-26

Development Credit Bank, DCB, one of India's private sector bank promoted by the Switzerland-based Aga Khan Fund for Economic Development, AKFED, headquartered in Mumbai, is open for subscription with an initial public issue of 7,15,00,000 equity shares of Rs 10 each.

The price is to be determined through a 100% book build process. The issue will close on October 6, 2006.

It has fixed the price band for its initial public offering, IPO of equity shares of Rs 10 each between Rs 22 and Rs 26 per share.

The issue comprises of a reservation of 25,02,500 equity shares for eligible employees and the net issue to the public would be for 6,89,97,500 equity shares.

The issue will help the bank strengthen its capital base as also help it meet the capital adequacy norms required by Basel II and recommended by the Reserve Bank of India.

The book running lead managers to the issue are JM Morgan Stanley Private Limited and Enam Financial Consultants Private Limited. Intime Spectrum Registry Limited has been appointed as the registrar to the issue.

Global Vectra Helicorp IPO opens for subscription

Global Vectra Helicorp, one of the largest dedicated offshore transportation services helicopter company, is open for subscription with its initial public offer, IPO of 35,00,000 equity shares of Rs 10 each for cash at a premium to be decided through the book-building process.

The company has fixed the price band for the issue between Rs 175 and Rs 200 per equity share of Rs 10 each. The issue will close on October 6, 2006.

Of the total offer, the company will be issuing 28,00,000 fresh equity shares and the balance 7,00,000 equity shares are an offer for sale by an existing investor, Azal Azerbaijan Aviation Limited. The issue constitutes 25% of the fully diluted post issue equity capital.

The company proposes to reserve 50% of the total offer for allocation to qualified institutional buyers on a proportionate basis and 15% will be reserved for allotment on a proportionate basis to non-institutional investors. The balance 35% will be reserved for allotment to retail individual bidders.

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

The book running lead manager to the issue is SBI Capital Markets.

Global Vectra Helicorp, GVHL presently has 14 Bell 412 helicopters each having 13 passenger seats and two pilot seats. GVHL is part of the Vectra Group, which has 18 companies in six countries, primarily in India and Eastern Europe.

For fiscal 2006, the company achieved gross revenue of Rs 898.38 million as compared to Rs 524.20 million in fiscal 2005, an increase of 71.38% year on year. The net profit for fiscal 2006 was Rs 78.01 million as compared to a net loss of Rs 4.31 million in fiscal 2005.

GVHL‘s biggest client is the largest oil and gas company in the country. The other clients include Reliance Industries, British Gas Exploration and Production, Transocean and Gujarat State Petroleum Corporation.

No plans for IPO: LIC

Life Insurance Corporation on Thursday ruled out any plans for initial public offer, IPO, saying any such plans require amendment in the LIC Act, reports The Economic Times.

"Coming out with an IPO would require amendment in the LIC Act and LIC would have to be converted to a company instead of corporation. There are no such plans," LIC chairman T S Vijyan told reporters on the sidelines of its golden jubilee celebrations.

There were some speculations that the largest insurer may come out with an IPO to raise money.

The LIC chairman also said that the corporation will meet from its own resources the requirement of Rs 7,000 crore (Rs 70 billion) to increase its solvency margin to 150% in the next two years from the current 130%.

Vijayan said it would invest 8-10% of its incremental income in the equity markets, but the pattern of investment may change as per the customers’ preferences in unit-linked products.

"As per the current investment pattern, we have decided that of all our incremental income, 8-10% would be invested in the (equity) markets," he said.

However, if the components of unit-linked products are more in new policies, this calculation would not hold much water, he said.

"If large customers in ULIP opt for debt products, there is no equity in that," he said, adding that in the days of growing popularity of unit linked products it is hard to say in advance about the investment pattern.

Only a small portion of the corporation's total premium income is coming from new policies, he said. Last year, only Rs 18,000 crore (Rs 180 billion) was brought as first premium of the total income of over Rs 90,000 crore (Rs 900 billion), he said.

Euro Ceramics files draft prospectus with Sebi

Euro Ceramics is currently engaged in the manufacturing of Vitrified Ceramic Tiles and Aluminum Extruded Sections at its manufacturing facilities located at Bhachau in Kutch District in Gujarat, as per press release.

It has filed its draft red herring prospectus with Sebi on September 28, 2006.

Euro Ceramics proposes to enter into the capital market with an issue of 56,21,500 equity shares of Rs 10 each, out of which 1,21,500 equity shares are reserved for employees.

The issue price of the equity shares will be decided through 100% book building process. The net issue to the public will constitute 32.16% of the fully diluted post issue paid-up capital of the company.

The net proceeds of the issue after deducting issue expenses will be utilized towards part financing the funds required for setting-up of manufacturing facilities for Sanitary Ware Products at Bhachau, Kutch and General Corporate Purposes.

The total cost for setting-up of manufacturing facilities for Sanitary Ware Products is about Rs. 7,693.37 lakh. The company has already signed a contract with SACMI Hong Kong Limited for supply of about 70% of the total requirement of Plant & Machinery.

The equity shares of the company will be listed on the BSE and NSE. The book-running lead managers to the issue are UTI Securities and ENAM Financial Consultants.

Monday, September 25, 2006

Simiah International to float IPO in 2008

Construction and real estate developer, Samiah International Builder plans to tap capital market toward in the end of 2008, reports The Economic Times.

"We see lot of opportunities in this space (real estate development) for which we would require funds in the future," said Samiah, chairman, Jamil A Khan.

The company plans to float initial public offer, IPO in Novemeber 2008, he said.

"Currently, we are developing a couple of housing projects both in UP and Uttaranchal for which funding has been tied up," he said.

Last year, the company's turnover stood at Rs 100 crore (Rs 1 billion) and in the current year it is likely to clock a turnover of Rs 250 crore (Rs 2.50 billion), he said adding in the next three years the topline of the company would touch Rs 500 crore (Rs 5 billion).

Talking about the future plan, Khan said, apart from the above two states, the company would shortly foray into other states like Rajasthan, Madhya Pradesh and Gujarat in the residential housing development.

The company also expects approval for its proposed projects in Muradabad, Deharadun and Ghaziabad in next three months.

The Delhi-based company announced launch of four projects namely, NRI Lake City Township in Rudrapur, Garden City Township in Hapur, Group Housing in Lucknow and Raksha Retreat Project in Nainital.

He said the booking for these projects have started and will cater to all the income group right from economically poor section to high income group.

Khan said, the above four projects are worth more than Rs 2,500 crore (Rs 25 billion) and scheduled to be complete by the end of 2008.

The company has also tied up with Defense Housing Board under consortium agreement for developing an integrated housing complexes in UP and Uttaranchal.

Under this scheme, the company is developing a project in Dehradun and proposes to develop similar projects in Rudrapur, Hapur, Lucknow, he said.

Since the inception in 1994, the company has developed or built over 15 million square feet of residential space for over 10,000 customers, he said.

Saturday, September 23, 2006

Jawed Habib salons on expansion spree, plans IPO

Hair-styling and hair-beauty advisor Jawed Habib Hair and Beauty plans to expand its salon network in India and overseas, reports Business Standard.

The company is also pondering over raising the capital early next year through private placement and to wrap it up by an initial public offering, IPO on the Indian stock market.

Vinit Gupta, director and chief executive officer of the company, said that the firm currently operates 80 salons, including ten overseas units, and wants to take their number to 200 in one-year.

“We will be also consolidating our position in 28 cities where we are currently operating and perhaps will add more to the list,” Gupta said, adding around 30 new outlets would be opened overseas, mainly in Mauritius, West Asia and Australia.

The company will look at both the organic and inorganic route for growth as increasing the number of outlets will be not possible just by banking on the organic route.

“We will look at local chains of beauty parlours and rebrand them as ours,” Gupta added.

Ruling out the franchisee route, Gupta said the company will be manned by its own staff. “We have been training our professionals and are capable of staffing our salons ourselves,” he said.

Divulging the financial support, Gupta said the company would place about 35% of its equity with high net-worth individuals on a private placement basis.

This will yield the company approximately USD 3.5 million at USD 10 million enterprise value, he said. The company may consider public issue towards the end of 2007.

However, it is premature to discuss the details, he added.

Applabs to consider IPO on reaching revenues of $100mn

Unlisted Indian software testing company Applabs Technologies said on Wednesday that it had acquired UK-based IS Integration for USD 37 million, reports DNA.

"This acquisition gives us the size to consolidate and become a significant player in our segment," chief executive officer Sashi Reddy said.

IS Integration's chief executive Clive Grummett said the deal would give it a wider reach as its operations were currently restricted to the UK IS Integration offers business software testing consultancy services.

The deal was funded by USD 10 million from private equity fund Sequoia Capital India, USD 12 million was raised as debt from UTI Bank, Singapore while the remaining payment was made in stock.

Sequoia has so far made a total investment of USD 17 million in Applabs.

A public offering to Indian investors would be considered by Applabs only after it reached revenues of USD 100 million, which is expected to happen in the next 8-9 months.

"We should be able to think about an IPO in the summer of 2007," Reddy said.

The company expects revenues in the current fiscal year to March 2007 - including from IS Integration - to touch USD 75 million, while net profit is expected to be USD 8 million, Reddy said.

Accel Front IPO opens on Sept 28, price band at Rs 75-90

Accel Frontline, an information techology services provider specializing in consulting, infrastructure, applications, outsourcing and support services, proposes to enter the capital market on September 28, 2006 with an IPO of 5,635,950 equity shares of Rs 10 each through 100% book building process in the price band of Rs 75 to Rs 90, as per press release.

The issue closes on October 5, 2006. The issue would constitute 25.04% of the fully diluted post issue paid-up capital of the company.

Accel Frontline proposes to invest net proceeds of the issue to fund regional and global expansion plans and acquire and invest in strategic businesses. It also has plans to expand and improve its ESS and BPO infrastructure.

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

SBI Capital Markets is the BRLM and Bajaj Capital is the co-BRLM for the issue and Intime Spectrum Registry is the registrar.

The public issue comprises of a fresh issue of 51,75,667 equity shares by Accel Frontline and an offer for sale of 4,60,283 equity shares by Intel Pacific. 50% of the offer to the public 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 Securities and Exchange Board of India, Sebi and the remaining QIB portion shall be available for allocation to the QIB bidders including mutual funds, subject to valid bids being received at or above the issue price.

Further, atleast 15% of the offer to the public shall be available for allocation on a proportionate basis to non-institutional bidders and at least 35% of the offer to the public shall be available for allocation on a proportionate basis to retail individual bidders, subject to valid bids being received at or above the issue price.

The company's total income for the year ended March 31, 2006 touched Rs 1,704.29 million and PAT at Rs 97.11million as against total income of Rs 1,368.18 million and PAT of Rs 42.16 million for the previous year.

Thursday, September 21, 2006

Subhiksha plans IPO on reaching 1,000 stores

Discount retail chain Subhiksha is looking to grow to a 1,000 outlets in the next one-year. Currently it has a business plan for a 600 store national roll out in five states at an outlay of Rs 300 crore that the company hopes to complete by March 2007, reports DNA.

“But we don’t have a choice,” says R Subramanian, MD of the 10-year-old chain, which has sales of Rs 330 crore (Rs 3.30 billion) from 140 stores operational in Tamil Nadu. And clearly, the acquisition route is definitely on the cards though Subramanian would not like to emphasise too much on the strategy.

And market talk has it that Subhiksha is the frontrunner for taking over the retail business of the Adani group in Gujarat. Though he refused to either confirm or deny talk of talks between the two groups, Subramanian said something could be expected in a week’s time on the acquisition front.

The retail business of the Adanis could be around Rs 110 crore (Rs 1.10 billion) if one were to take into account the three formats that the group in into, Subramanian said.

Adani Retail had in the past denied its business was on the block though it was in the midst of a restructuring exercise. For Subhiksha, the 1,000 stores milestone is important considering that is the time when the group would like to go public, Subramanian said.

He, however, also denied reports of talks with Reliance Retail stating the group would not like to have truck with a competing retail chain.

Subhiksha will invest Rs 40 crore (Rs 400 million) in Andhra Pradesh where it will open 80 stores in two cities over the next four months.

DCB Bank's IPO by September end

Development Credit Bank, DCB will tap the capital market to raise Rs 200 crore (Rs 2 billion) through an initial public offer, IPO, which is expected by the end of September, reports The Financial Express.

"We will be coming out with an IPO to raise Rs 200 crore to fund our growth purposes," DCB Bank chairman Nasser Munjee said here on the sidelines of an Assocham interactive session.

He said the proceeds from the IPO would be utilized primarily for lending to the retail and small and medium enterprises, SMEs.

The IPO would be through book building process, after which the holding of the bank's promoters would come down to about 32%.

The private sector bank is promoted by Aga Khan Fund for Economic Development, AKFED.

JMD Promoters eyes IPO route for expansion

Real Estate player JMD Promoters is planning to come out with an initial public offering, IPO to fund its construction activities across the country. The company is developing a range of properties that it would be constructing in different parts of the country, including an IT park in Goa, reports The Hindu Business Line.

"We are in the process of consolidating our company since each of our projects is handled by a different company in the group. We expect to come out with an IPO in about six months," said Ramneet Trehan, vice-president, marketing, JMD Promoters.

The consolidation of the group companies would be in place in about two to three months, he added.

The IT Park being developed by the company in Goa will be spread over an area of 50 acres. "We are currently in the process of designing the park. The development will start in a couple of months," said Trehan. The 30-lakh sq ft constructed part of the park will be given out to gaming, software developing and hardware producing firms. The total investment in this project will be in the Rs 300-400 crore range.

Housing projects

The company, which recently forayed into the development of residential properties, has two housing projects on the cards, one each at Panipat and Jaipur. The project in Panipat will be spread over an area of 20 acres. Around 1,000 apartments each of 2,000 sq ft will be constructed in about three years. "The apartments will cater to the growth of both Panipat and Karnal. We are awaiting the licenses and construction should start in a few months," said Trehan.

In Jaipur, the company is developing about 800-1000 apartments in 17 acres of land. The apartments being developed by JMD in both the cities will have clubbing and other modern facilities. Each of the housing projects would require an investment of Rs 300 crore.

Other properties being developed by JMD include a corporate complex in Gurgaon with retail space on the ground floor and office space on the next five floors. It entails an investment of Rs 50-60 crore (Rs 500-600 million).

Also on the anvil are two malls in Gurgaon that are slated to be complete in eight to nine months. The company plans to fund the projects from internal accruals, loans and also foreign direct investment.

Wednesday, September 20, 2006

Central Bank, UBI, Indian Bank to make market debut in ’07

Three unlisted public sector banks - Central Bank, United Bank of India and Indian Bank - are expected to hit the capital markets early next year with initial public offerings, IPO, which will also see the dilution of the government’s stake by 8-10%. The government, which currently holds a 100% stake in the company, is planning to list these banks between January and March ’07, reports The Economic Times.

The government is planning to clean up the balance sheets of these banks by writing off their accumulated losses against their equity capital. It will help them raise capital to meet capital adequacy norms under Basel-II requirements. An IPO would reduce the government’s holding in these banks from the current 100%.

However, in case of these banks, the government has a large headroom to reduce its holding substantially without diluting its ownership, unlike in most other public sector banks where it has already reached 51%.

Some of these banks are considering converting a part of their equity capital into preference shares for sharper pricing of their IPOs. This will help improve their earnings per share as they can then charge a higher premium.

The government is planning to restructure Rs 278-crore (Rs 2.78 billion) loss of Union Bank of India before its IPO. Central Bank has also submitted a proposal to split its capital base to increase its earnings per share before the IPO. At present, Central Bank has a total equity of Rs 1,124.14 crore (Rs 11.24 billion), while UBI’s figure is put at Rs 1,810.87 crore (Rs 18.10 billion).

The finance ministry has restructured the capital base of Indian Bank by writing off its accumulated loss of Rs 3,800 crore (Rs 38 billion) (as on March 31, ’05) against its equity.

Some of the weak banks have not yet been able to make use of hybrid instruments because of their low ratings. Their ratings will improve once they are listed. The Centre has pumped in over Rs 20,000 crore (Rs 200 billion) as special securities into its unlisted banks over the last decade to shore up their capital base.

After a Cabinet approval recently, these banks can convert non-tradable special securities into tradable securities. This will enhance the flexibility of these banks that invested in the recapitalisation bonds. The banks could not show these investments under the statutory liquidity ratio.

GAIL-British Gas spar over MGL public offer

UK-based gas major British Gas India’s plans to seek a waiver from the Foreign Investment Promotion Board, FIPB on a 30% initial public offer, IPO by its gas distribution company, Mahanagar Gas, MGL, has hit a roadblock, reports The Financial Express.

BG’s joint venture partner in MGL, GAIL (India), has said it does not back BG’s stand. “GAIL management is of the view that MGL should plan its IPO by December 2006 in step with the provisions of the JV agreement, as the extension of the FIPB approval is valid only till December 2006,” GAIL wrote to the petroleum ministry on September 6.

In the joint venture, GAIL and British Gas hold 49.75% each; balance 0.5% held by the Maharashtra Government.

BG India managing director William Adamson had recently said that his company had approached the government for a waiver following recent changes in FDI rules.

“Foreign investment in pipelines is no more restricted and has been allowed under the automatic route. As a result, it is no longer required to dilute or disinvest a certain percentage of equity in the company undertaking gas distribution. As we are here to invest and not disinvest, we have sought the waiver,” Adamson had told.

Under the agreed norms, BG and GAIL had to reduce their stake in MGL to 35% each, with MGL floating an IPO. However, BG has been seeking extensions from the FIPB on the IPO clause. The FIPB has given a final extension to BG to launch the MGL IPO by December 2006.

Nissan Copper to fund expansion via Rs 250mn IPO

Nissan Copper is slated to raise Rs 250 million through an IPO, while it will raise Rs 100 million through a term loan from State Bank of India, reports Myiris.

The funds raised shall be utilised for the capacity enhancement programme. An additional working capital limit of Rs 100 million has been sanctioned by SBI.

The company, in order to meet the increasing demand for its products, plans to make the Silvassa Unit an integrated copper plant. The company currently manufactures copper tubes, pipes, flats, rods etc. The expansion plan envisages augmenting the copper pipes capacity from 1200 TPA to 2400 TPA. Meanwhile, the copper ingots capacity is also on the cards. The capacity is to be enhanced from 7200 TPA to 10800 TPA.

Popley group to offload stake via equity issue

The Popley group, retailer of jewellery and luxury brands, is planning to offload part of its stake through an equity issue in a year, reports Business Standard.

"The company is looking at raising funds to finance its expansion plans," said Rajiv Popley, director, Popley Group.

The group is planning to expand its retail formats, Le Classique and Diatime. While Le Classique is focused on jewellery and accessories such as watches and mobile phones costing over Rs 45,000, Diatime is the department store brand which stocks a range of diamond jewellery and time wear.

The company recently has tied-up with high-street label from France. The French fashion brand, Kookai, will now be available in Diatime outlets.

Though, Kookai is predominantly an apparel brand, Popley said, at present, they would focus on watches.

Diatime is predominantly a store-in-store format, present in Shoppers' Stop and Globus. It will soon be opening its brand boutique in Mumbai by the end of the year. Additionally, the Popley Group has also tied up with Lifestyle and Pantaloon to retail through their stores.

It stocks eight jewellery and watch brands such as Omega and Tissot and the plan is to nine more brands in one year. Leather accessories and writing instruments, through Estee Dupont is one more area where the company is keen on expanding.

Also planned are brand stores for Swatch and Tissot. Apart from Mumbai, the group also has a presence in Dubai where it is on an expansion mode.

"After 2008, we will also tap new markets internationally starting with London. In India too we will move to the other metros with our formats after one year," said Popley.

Besides the Diatime expansion, the group also plans to expand its private labels like Rhea, Emotions, Diamond IDs and Bandhan.

The group has a turnover of Rs 450 crore (Rs 4.50 billion) and is looking at touching Rs 650 crore (Rs 6.50 billion) by next year.

Minar Intl IPO opens on Sept 25; price fixed at Rs 108-115

Minar International, a leading exporter of made-ups to the US markets, proposes to enter the capital market on September 25, 2006 with an IPO of 69,23,077 equity shares of Rs 10 each through 100% book building process in the price band of Rs 108 to Rs 115 per equity share, as per press release.

The issue closes on September 29, 2006. The issue will constitute 28.49% of the post issue paid-up capital of the company.

The issue is being made through the 100% book building process where up to 50% of the net issue to the public shall be allocated on a proportionate basis to qualified institutional buyers, QIBs. 5% of the QIB portion shall be available for allocation on a proportionate basis to mutual funds only and the remainder of the QIB portion shall be available for allocation on a proportionate basis to all QIBs, including mutual funds, subject to valid bids being received at or above the issue price.

Further, at least 15% of the net issue to the public shall be available for allocation on a proportionate basis to non-institutional bidders and at least 35% of the net issue to the public shall be available for allocation on a proportionate basis to retail individual bidders, subject to valid bids being received at or above the issue price.

The actual issue size was 80,00,000 equity shares, out of which Minar International has already made a pre-issue allotment of 10,76,923 equity shares valued at Rs 1613.95 lakh in June 2006 to two leading US buyers, reducing the size of the public issue to 69,23,077 equity shares. This include allotment of 7,69,231 equity shares to Bristol Associates, USA, at a price of Rs 150.28 per equity share and 3,07,692 equity shares to Sunham Home Fashions L.L.C. USA at Rs 148.84 per equity share. Earlier in May 2006, the company had allotted 3,07,692 equity shares to Sunham Home Fashions LLC of USA at a price of Rs 145.95 per equity share and 1,53,846 equity shares to Bristol Associates of USA at Rs 145.78 per equity share.

The company proposes to utilize the net proceeds of the issue for its expansion plan involving setting up of a wider width fabric processing unit - in SIPCOT Industrial Growth Center, Perundhurai, Erode Dist, Tamil Nadu. This strategic location is selected because the highest amount of grey fabrics is woven around this area of Tamil Nadu particularly in reference to fine and super fine fabric categories.

Keynote Corporate Services is the BRLM for the issue and Intime Spectrum Registry is the registrar. The equity shares are proposed to be listed on BSE and NSE.

Kingfisher Airlines IPO only after it breaks even: Mallya

United Breweries Group chairman Vijay Mallya on Tuesday said Kingfisher Airlines would go in for an initial public offering (IPO) only after it achieved break-even, which is expected in 2007-08.

"Kingfisher Airlines is not IPO-dependent. We are fully funded. We have all our financial arrangements locked up", he told reporters in response to questions after the annual general meeting of United Breweries Limited.

"We will go for an IPO once we (Kingfisher Airlines) break-even and we are able to solidly demonstrate our business model to the investors", he said.

Mallya said the airlines is targeting break-even in 2007-08.

He also said the Kingfisher Airlines already has a paid-up equity capital of over Rs 400 crore.

Kingfisher Airlines IPO only after it breaks even: Mallya

United Breweries Group chairman Vijay Mallya on Tuesday said Kingfisher Airlines would go in for an initial public offering (IPO) only after it achieved break-even, which is expected in 2007-08.

"Kingfisher Airlines is not IPO-dependent. We are fully funded. We have all our financial arrangements locked up", he told reporters in response to questions after the annual general meeting of United Breweries Limited.

"We will go for an IPO once we (Kingfisher Airlines) break-even and we are able to solidly demonstrate our business model to the investors", he said.

Mallya said the airlines is targeting break-even in 2007-08.

He also said the Kingfisher Airlines already has a paid-up equity capital of over Rs 400 crore.

JHS Svendgaard IPO opens on Sept 26

JHS Svendgaard Laboratories is entering the capital market with a public issue of 67,00,000 equity shares of Rs 10 each including promoters contribution of 5,00,000 equity shares of Rs 10 each, as per press release.

The net issue to the public is 62,00,000 equity shares of Rs 10 each. The issue is being made by 100% book building process and the price band is Rs 49 to Rs 58 per equity share. The net issue will constitute 49.60% of the fully diluted post issue paid capital of the company.

The issue opens on Tuesday, September 26, 2006 and closes on Wednesday, October 4, 2006.

JHS Svendgaard is a dental and oral healthcare products manufacturing company. It manufactures wide range of dental and oral care products acting as contract manufacturer for many domestic as well as global brands. Starting with the manufacturing of toothbrushes, the company has ventured into other oral care products like toothpaste, whitening gel, whitening mouth rinse, denture cleaning effervescent tablets and tongue cleaner.

The company has three production facilities of which two are located in New Delhi and a 100% EOU is located in Noida SEZ in Uttar Pradesh.

Looking at the vast growth potential in the oral care market in India, the company is now setting up an integrated manufacturing facility at Kala Amb, District Sirmour in the State of Himachal Pradesh and also increasing its capacity in its 100% EOU at Noida. For the Kala Amb facility, the company will import anchor free technology enabled machineries from Belgium for the manufacture of state-of-the-art toothbrushes. Automated machinery will also be acquired for the manufacture of toothpaste and other oral care products. The total cost for the new and expansion projects is estimated at Rs 51.77 crore (Rs 517.7 million).

The new and expansion projects are in an advanced stage of implementation and commercial production is expected to commence in December 2006. Post expansion the annual installed capacities of all products will increase substantially – toothbrushes from 40 million units to 116 million units; toothpaste from 450 tonnes to 2,700 tonnes; denture cleaning tablets from 5 million units to 180 million units and other oral care products from 60,000 litres to 5,00,000 litres.

The company’s strategy includes being the preferred contract manufacturer to the retail chains in India as well as those planning to enter the Indian market. This shall provide the company with a ready platform to allow retail giants replicate the model of international market by selling products in their stores under their own brand name.

The company enjoys significant advantages on account of its in-house facilities and low turnaround time, quality assurance, design flexibility, integrated operations, economies of scale and professional management.

For the year ended March 31, 2006, JHS Svendgaard posted net profit of Rs 4.03 crore (Rs 40.3 million) on turnover of Rs 36.93 crore (Rs 369.3 million).

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

UTI Bank, Centrum Capital and Bajaj Capital are the book running lead managers to the issue.

Gayatri Projects IPO opens on Sept 26

Gayatri Projects is planning an IPO which will open on September 26, 2006. The price band for the issue has been fixed between Rs 275 and Rs 295.

Gayatri Projects is an ISO certified company engaged in execution of major civil works including roads and highways, irrigation canals, concrete/masonry dams, ports, etc. It is entering the capital market with an initial public offer of 29,00,000 equity shares of Rs 10 each for cash at a premium to be decided through the book-building process.

The issue comprises of an offer for sale of 19,00,000 equity shares and a fresh issue of 10,00,000 equity shares. The offer for sale is being made by Videocon Appliances Ltd and Videocon Industries Ltd.

The company also proposes to reserve 1,00,000 equity shares for allotment to eligible employees. The offer constitutes 29% of the post issue paid up capital of the company.

Wednesday, September 13, 2006

MCX to float IPO after govt okays FII norms in commodity exchange

Multi Commodity Exchange, MCX will re-file papers with Securities and Exchange Board of India for initial public offer, IPO of equity shares worth 3-5 billion rupees immediately after the government allows foreign institutional investment in commodity futures, managing director and chief executive officer Jignesh Shah said today, reports CMW.

Currently, Forward Contract (Regulation) Act does not allow mutual funds, foreign institutional investors and banks to trade in commodity futures.

"We are waiting for government policy on FII investment in commodity exchanges. Once it is done, we will immediately file papers. This (MCX) will be India`s first commodity exchange floating an IPO," Shah said.

MCX had filed its draft red herring prospectus for IPO on March 16 for issue of 5 million shares having a face value of Rs 10 each.

The IPO comprises a fresh float of 1.4 million shares by MCX and an offer for sale of 3.6 million shares by the promoters - Financial Technologies (India) and Corporation Bank.

The proceeds from the IPO would be utilised for further expansion of operations and setting up rural infrastructure.

Govt not to sell stake in PFC, IPO to go ahead

The Prime Minister's Office has asked Power Ministry not to go ahead with the sale of 5% government shares in Power Finance Corporation, PFC and come up with a fresh proposal for the company's maiden public offer, reports agencies.

"The PMO has told Power Ministry that the government would not like to sell its shares in PFC but the company should be allowed to go ahead with its IPO plans," senior officials said.

The Power Ministry would now have to draft a fresh Cabinet note for the IPO to raise its equity base by 10%, which amounts to 10.3 crore shares.

When contacted Power Ministry sources said the process has already been initiated for getting fresh cabinet approval.

Before the disinvestment process was halted due to opposition from supporting Left parties and DMK, the UPA government had decided to piggy ride on the PFC public offer and sell its 5% shares in the market as part of disinvestment.

The company had even filed the draft prospectus with the market regulator Securities and Exchange Board of India. The Sebi approval came on July 16 and it had three months to hit the market.

However, with plans changing, the entire process would have to be repeated once again.

PFC was offering 15.45 crore equity shares of Rs 10 each. This included 10.304 crore new equity shares and an offer for sale of 5.15 crore equity shares by the government.

The issue would have constituted approximately 13.64% of the post issue fully diluted equity share capital of PFC.

If the original plan had gone through, the share of the government in the company would have come down to 86.36% from the present 100%.

Idea IPO likely early next year

The Aditya Birla group is learnt to be considering the option of an initial public offer to sell part of its stake in its telecom business - Idea Cellular - by early next year, reports The Economic Times.

But the group is also not averse to the idea of a pre-IPO placement to gain from the current interest in the telecom sector, chairman Kumar Mangalam Birla said.

Idea Cellular was originally a JV between the Tatas and the Birlas, before the latter bought out the Tatas’ 48% stake for Rs 4,406 crore (Rs 44.06 billion). After the deal with the Tatas, the Birlas indicated that they were looking at selling Aditya Birla Nuvo’s stake of 33% in Idea.

“We are talking to other private equity groups including Providence for selling the (Aditya Birla) Nuvo stake, since the due-diligence is on, it’ll take some time,” Birla said recently.

The Birlas own 98.3% in Idea, with Aditya Birla Nuvo holding 35.7%, Birla TMT Holdings 44.9%, Grasim 7.5%, and Hindalco 10.1%. However, officials indicated that the group is exploring options of an IPO where about 20% of the Birlas’ equity can be sold. The move comes on the back of a revival in the capital market and strong prospects for the telecom sector.

According to analysts, a public float would help Idea get money for expansion and increase visibility. “There is healthy appetite for telecom paper in the market because Bharti Airtel and Reliance Communications are the only other major telecom service providers that are listed,” said an analyst with a Mumbai-based brokerage. State-owned MTNL, VSNL and Tata Teleservices (Maharashtra) are the other listed companies.

Idea has a net worth of Rs 1,042.92 crore (Rs 10.42 billion), as per a document submitted by the company to the department of telecom, DoT. Going by the valuation of the Tatas’ 48.14% stake at Rs 4,406 crore, the total value of the company could be pegged at Rs 9,152 crore (Rs 91.52 billion), or Rs 40.50 per share. Analysts however estimate the valuation to be in the range of Rs 20,000 crore (Rs 200 billion) to Rs 25,000 crore (Rs 250 billion).

Group officials said another supporting reason for an IPO is the scope for growth.

Everonn Sytems IPO likely to hit capital markets

Everonn Sytems has decided to make a public issue of its 50 million equity shares of Rs 10 each, issued for cash.

Further, the company has decided to compulsorily allot at least 50% of the net issue to the public, to qualified-institutional investors (QIBs) on a proportionate basis, of which 5% would be reserved for mutual funds.

Not less than 15% of the net issue to the public would be available for allocation on a proportionate basis to non-institutional bidders, while at least 35% would be allocated to retail investors, subject to valid bids received at or above the issue price.

Centrum Capital is acting as leading book runner to the issue. Cameo Corporate Services is the registrar to the issue.

IMFA plans to go public amid revamp

The Orissa-based chrome ore major, Indian Metals and Ferro Alloys, IMFA, is embarking on an elaborate process of consolidation, public offering and extensive investment to sharply upscale both its size of operations and market share, reports Business Standard.

In the first place, IMFA is to merge its subsidiary Indian Charge Chrome, ICCL with itself. "The merger should take place any time from now as the court convened meeting of the shareholders and the follow up petition are over. Post merger IMFA will be listed on major stock exchanges. The listing is expected to take place by October," said Subhrakant Panda, managing director.

"The merger will consolidate IMFA's position as the largest ferrochrome manufacturing company in the country," he said. As a result of the merger the promoters' holding in IMFA will come down to 57% from the existing 76%.

Currently, ICCL is the listed entity on the Bombay Stock Exchange, BSE and other stock exchanges, which will automatically de-list post merger. ICCL produces charge chrome, which has lower chrome content than ferrochrome.

The IMFA group is the largest producer and exporter of ferro chrome, with a current domestic capacity of 157 MvA, backed by a 108 mw captive thermal power plant. Tata Steel and Ferro Alloy Corporation are the other makers of the commodity.

To further consolidate its market share, IMFA, armed with the proceeds of the issue, plans to invest Rs 750 crore (Rs 7.50 billion) in setting up new ferro chrome plants and related captive power facilities.

"We are in talks with the Orissa government for more ferro chrome mine allotment in the immediate future that will secure us enough reserves to extract four lakh tonne of ferrochrome ore every year," said Panda.

DLF has to settle investor dispute ahead of float

The company affairs ministry would clear a mega initial public offer, IPO of DLF Universal only after the real estate developer settles on its own all outstanding issues with its residual investors, who could not exit from the company during its ’03 de-listing, reports The Economic Times.

Over Rs 1,500 crore (Rs 15 billion) is at stake in this dispute as per DLF’s earlier offer, which had been withdrawn early this month. Investors claim that the debenture warrants of Rs 100 awarded to the luckier ones last year, now stand to be worth Rs 35,000 after conversion to equity shares, if they were to go by the previous offer price.

The ministry is not expected to show the green light to the IPO merely based on a report of the Registrar of Companies, which has not found the company guilty of keeping 1,308 investors uninformed about a debenture issue last year.

The ministry, which is examining the RoC report now, is likely to take the view that a mutual settlement between the company and the investors would be the ideal solution rather than the government sitting in judgement of not only legal, but also the moral behaviour of the company prior to the IPO. It was alleged that DLF had misled investors last year-end, saying it had no immediate plans to re-list the shares - a charge difficult to examine as the company law does not define the term ‘immediate’.

Although the company could show evidence that it had despatched offer letters to the minority shareholders, it can hardly be established that investors had received it but had misjudged its worth as the company claims. Instead of the government making subjective conclusions, it is better to give the two parties an opportunity to settle the issue between themselves, a source said.

Besides, if the disagreement is only about the delivery of letters and not about intentions, then an amicable solution is easy. This would ensure an opportunity to protect the investors’ interests without the government interfering in the affairs of a company when there is no conclusive evidence of wrongdoing.

The episode of residual investors staking claim for a huge amount on the eve of the company going public again, has also drawn the government’s attention to address it in the new company law. The new law would require all corporates to set up investor grievance committees, it is understood.

Monday, September 11, 2006

Hilton Metal Forging to raise Rs 381.5 mn via IPO

Hilton Metal Forging plans to raise Rs 381.5 million via the IPO, while, an additional sum shall be raised to tune of Rs 100 million through a term loan from State Bank of Hyderabad, said the draft prospectus of the company. The loan amount constiutes 20.77% of the total project cost.

The company has mooted an expansion of its existing capacity from 11100 MTA to 24900 MTA by installing additional Plant & Machinery in order to augment the existing manufacturing facilities.

The company`s target customers are primarily OE manufacturers and they contract their sales on direct sales basis, both in domestic and international market. It has already established strong relationship with the leading automobile manufacturers and OE manufacturers in India and abroad.

The company is one of the two Indian Forging Companies have US approval for 0.60% import duty as against anti-dumping duty of 160% imposed on other units. This has opened a very big market for the company.

Gwalior Chem IPO opens for subscription today

Gwalior Chemical Industries, GCIL, a producer of niche chemical products for agro-chemicals, pharmaceuticals, dye, flavour and fragrance industries, is open for subscription with an initial public offering, IPO of equity shares aggregating to Rs 80 crore (Rs 800 million) through a 100% book build process.

The price band for the offer has been fixed between Rs 71 and Rs 85 per share. The issue closes on September 14, 2006.

Of the total offer, upto 50% will be allotted on a proportionate basis to qualified institutional buyers, QIBs, of which 5% is reserved for allocation to mutual funds. Another 15% would be available for allocation on a proportionate basis to non-institutional bidders and the balance 35% will be reserved for allotment on a proportionate basis for retail individual bidders.

About the company

GCIL is an integrated facility at Nagda, Madhya Pradesh and Ankleshwar, Gujarat to manufacture chlorinated compounds and their derivatives. The range of chlorinated compounds includes chlorotoluene range and sulphur chlorides range. In the chlorotoluene range the three primary products are benzyl chloride, benzal chloride and benzo trichloride. Moreover, the company also manufactured black viscose dye.

In the sulphur chloride range, the main products manufactured by the company include thionyl chloride and sulphuryl chloride having varied applications. The company has drawn up plans to further expand into acid chlorides, which are value added downstream products of thionyl chloride.

The net sales and adjusted profit after tax for fiscal 2006 was Rs 170.63 crore (Rs 1.70 billion) and Rs 15.59 crore (Rs 155.9 million) respectively as compared to a net sales and adjusted profit after tax of Rs 136 crore (Rs 1.36 billion) and Rs 13.02 crore (Rs 130.2 million) for fiscal 2005.

To cater to growing demand from export markets and the domestic market, the company has plans to expand its capacities both at Nagda. Moreover, the company is also setting up new plant at Nagda and Ankleshwar for producing second stage downstream products including benzyl esters and acid chlorides and a new plant for viscose dye pigments from the proceeds of the present issue.

JM Morgan Stanley Private Limited is the sole book running lead manager to the issue.

Thursday, September 07, 2006

Deco group to come out with IPO for ceramic expansion

To catch on with the booming market, Morbi’s Deco group, one of India’s top 10 leading manufacturers of vitrified floor and luster wall tiles, is planning to go public in the next few months, reports Business Standard.

The company is all set to file the prospectus by late October to Sebi with an aim to raise Rs 65-90 crore (Rs 650-900 million) for further expansions of its ceramic business.

The group’s overall turnover stood at Rs 60-65 crore (Rs 600-650 million) in 2005-06 and aims to reach over a three-fold increase at Rs 225 crore (Rs 2.25 billion) in 2007.

Girish Pethapara, chairman of Deco group said, “The funds that we plan to raise is for expansion of our ceramic segment. This includes expansion of our existing vitrified tiles unit in Morbi. We aim to file the prospectus by October 29.”

The plant produces 6,000 sq feet (tiles) per day and the company aims to double it to 12,000 sq feet. The investment for this will be to the tune of Rs 20 crore (Rs 200 million), which includes marketing of the product. The group has eight outlets across the country, which will be raised to twenty in one-year. The overall market of vitrified tiles in India is about 1.2 lakh sq m per day and is growing about 25-30% every year.

“To cater to the energy needs of the Morbi unit, we also plan to set up a wind farm project in Kutch. We are in talks with Suzlon for purchasing the machines,” Pethapara said. The wind farm project is estimated to cost Rs 25 crore (Rs 250 million).

IDBI is the company’s merchant bankers and the face value is expected to be Rs 65-85 per share. The group has also chalked out plans to set up an aluminium composition panel project and a part of the funds raised will be used in this.

“The growing infrastructure needs has spurred the need for aluminium composition panel mainly used in centrally air-conditioned commercial structures. The project cost of this unit will be about Rs 20-25 crore (Rs 200-250 million),” said Pethapara.

Also, the company has recently made a foray into the lucrative Indian CFL market by announcing the launch of its Rema range of compact fluorescent lamps.

“Currently, we produce 20,000 pieces of CFL lamps and aim to reach one lakh mark in 2007. We aim to garner over Rs 100 crore (Rs 1 billion) sales from this sector,” he said.

The company also aims to foray into manufacturing of switches, circuit breakers, fans and optically compensate bend, OCB. The electrical and electronic appliances sector in India is estimated at Rs 60,000-70,000 crore (Rs 600-700 billion) and we aim to explore more into it, he added.

Hanung Toys and Textiles plans IPO

Hanung Toys and Textiles, HTTL, a USD 45-million (Rs 207 crore) company that manufactures soft toys as well as caters to the home furnishing segment, is planning an initial public offering, IPO in October this year, according to A.K. Gupta, vice-president - sales and marketing, HTTL, reports The Hindu Business Line.

He said here on Wednesday that the funds would be used to set up a 25-acre manufacturing facility at an investment of Rs 150 crore (Rs 1.50 billion) in Uttaranchal. He expects the facility to be operational by early-2007.

The company has two factories in Noida, one for toys and the other for furnishing. The facility in Uttaranchal would primarily manufacture products such as cushions, bedspreads, quilts and other home furnishing products, he said.

The company has taken up Disney's franchise in India for Disney soft toys and cushions, and launched these products here on Wednesday. Currently, the company's brand of soft toys `Play-n-Pet' has a 70% share of the organised soft toys market. Gupta said that the local market for toys is growing rapidly.

However, about 85-90% of the company's revenue is accounted for by exports. The products are being sold in the US, Canada, Germany, France, the UK, Sweden, Belgium, Russia, Austria, Poland and Chile, he said.

FDI policy on equity stake in bourses soon: Govt

The government today said it will soon decide whether foreign players can buy stake in Indian stock exchanges, which would make it clear if bourses can invite foreign strategic investment while divesting brokers equity in them below 49 per cent, in line with SEBI guidelines on demutualisation.

"The FDI policy on the issue will soon be a reality," a senior Finance Ministry official told reporters on the sidelines of inauguration of BSE regional office here.

While the finance ministry will give inputs, the commerce ministry will frame the FDI policy, he said.

The Finance Ministry is yet to take a view on allowing FDI in stock exchange, he said.

While the FDI policy will be framed by the Union government, the market regulator SEBI would issue regulations on mechanism of demutualisation, which basically means that trading activity and the management should be controlled by separate entities.

Many stock exchanges like BSE are awaiting the FDI policy and regulations on demutualisation from SEBI.

BSE had reportedly made it clear that 26 percent of the stake would be sold to strategic investors and the remaining 25 per cent through an IPO.

Over a month back Nasdaq official met their counterparts in BSE, giving rise to speculation that the tech exchange would pick up a stake in it.

Wednesday, September 06, 2006

Foreign stake issue delays MCX float

The much-awaited Rs 500 crore initial public offering (IPO) from the Multi Commodity Exchange (MCX) will get delayed by ‘several’ months owing to governmental delay in clarifying the issue of foreign participation in the equity of an exchange.

“The Reserve Bank of India (RBI) has sent a query to the finance ministry seeking clarifications on the foreign ownership of stock exchanges. To the best of my knowledge, there should be no restriction. We have never been given any indication on that. But the RBI has now asked for a clarification,” says Lamon Rutten, joint managing director of MCX.

Rutten believes that this will delay the IPO. “Even if there is an immediate turnaround from the government’s side and it issues a clarification tomorrow, it would have taken so much extra time that we will have to restart our procedure for an IPO,” he says. “The authorised data will be too old. So, we will have to go through the whole process again, have our accounts audited again and there will be several months of delay,” he adds.

Recently, there has been talk that the finance ministry was moving a cabinet note to define foreign portfolio and direct investments in the wake of an application by MCX for a pre-IPO private placement with foreign institutional investors (FIIs). The RBI is of the view that a pre-IPO placement, being a negotiated deal, is foreign direct investment (FDI), though there are FIIs investing in IPOs, in pre-IPO companies and in unlisted companies.

However, MCX being an exchange, its proposal for a pre-IPO placement to FIIs has kicked up some dust.

It also raises jurisdictional issues, as different ministries handle the norms on FDI policy and that on foreign portfolio inflows.

“We can go ahead with the IPO even now. But now, the RBI wants a policy on foreign investments in exchanges. It has sent a query to New Delhi for clarifications on foreign direct investments (FDI) in exchanges. But it is better to wait for the clarification,” MCX managing director Jignesh Shah told DNA Money.

When asked if the IPO will get deferred due to lack of clarification on the regulatory side, Rutton said, “We will do the IPO once the paper is cleared. Unfortunately, these things take so much time. But it does not influence our business and our operations. Financially, it is not an issue. We will have positive cash flows.”

Ranbaxy group co plans MF foray; to float an IPO in six months

Ranbaxy Group company Religare is eyeing a piece of the fast-expanding Indian Mutual Fund cake by this December.

Religare is soon likely to announce a joint venture (JV) with the Netherlands-based Aegon to float an asset management company.

Mutual Fund is the best investment option. Our mutual fund company will be formed before December, said V Ananthakrishnan, chief investment advisor-mutual funds, Religare. The capital structure is yet to be finalised, he added.

Recently, Religare signed an MoU with Aegon and launched the ER Capital India Fund.

With this launch, the company has entered insurance and asset management sector in the country. Bennett, Coleman & Company is Religare`s third promoter partner in life insurance segment.

Also, Bennett Coleman & Company would own 30% in the yet-to-be-declared JV, while Religare will hold 44% and the balance would be owned by Aegon.

Religare is eyeing an infrastructure expansion of 250 branches along with 1,000 business partners in at least 300 cities and seven international offices by the year-end, from the current moer than 175 branches and 350 business partners in 180 cities, apart from two international offices.

The company also plans an IPO through one of its subsidiaries Religare Securities within the next six months

Cairn on track for Dec. India IPO, field delayed

UK-based oil explorer Cairn Energy Plc is on track for an Initial Public Offering of its Indian operations in December but said its biggest oil field would come onstream later than planned, knocking its shares.

Cairn added in a statement on Tuesday that its oil reserves were slightly higher than earlier stated but investors were disappointed there were no significant reserves additions, which they had grown used to the Edinburgh-based company reporting.

Cairn's shares traded down 3.12 per cent at 2050 pence at 0737 GMT, compared to a 0.13 per cent rise in the DJ Stoxx European oil and gas sector index.

Cairn is planning to float its Indian oil and gas assets -- which account for over 90 per cent of the company's value, analysts said -- on the Bombay Stock Exchange (BSE) and National Stock Exchange of India (NSE).

Chief Executive Bill Gammell said in the statement that Cairn intended to retain a majority stake in Cairn India, as the unit controlling the assets is called, following the IPO.

The startup of the key Mangala field is delayed to 2009 due to tightness in the market for oil services, Chief Financial Officer Kevin Hart said on a conference call with journalists. The field was originally due to come online in 2007.

Richard Rose at Oriel Securities said the delay was "not wholly surprising".

Hart said that Cairn was considering becoming involved in building a pipeline to transport the oil at its Rajasthan fields to a refinery, to avoid further delays.

Earlier, it was envisaged that a state-owned oil company would build the pipeline and a new refinery to process the crude.

Cairn also increased its estimates of expected recoverable reserves at its three largest fields to 820 million barrels from 795 million barrels, exploration director Michael Watts said.

Cairn added that its pre-tax profit, excluding exceptional items, fell to $12.7 million on the first half, from $48.5 million in the same period last year, partly due to a 2 per cent fall in production and a 35 per cent rise in average, per barrel, production costs.

The company made a net loss of $5.8 million, after tax and exceptional items including a $5.7 million write-down in the value of a gas field.

However, as the vast majority of Cairn's value is tied up in non-producing fields, investors are generally not very concerned about the profitability of day to day operations.

State-run explorer Oil and Natural Gas Corp. Ltd. (ONGC) is Cairn's partner in its core Rajasthan assets.

Spice Telecom's mega plans to spice up telecom market

The telecom battle is getting spicier. Spice Telecom has an aggressive $2.5-billion plan for India and will hit the market with an IPO by December. CNBC-TV18 reports that Spice will not find the going easy in the fiercely competitive telecom market.
From being a two-circle operator, the company has plans to extend its operations to 21 new circles, for which it has applied for a license. Spice plans to invest $2.5 billion over the next two-three years.

And it will be tapping the capital markets in December to raise funds. The first round of Spice's public offering will be of around $250-300 million, to be followed by another offering of about $350 million in 2008.

"We have just finalised due diligence and preparation of the offer document. We hope that by late October-early November, we would be in a position to go for an IPO," said Dilip Modi, VC, Spice Communications.

The company's enterprise value is likely to be around $1.5 billion. Telecom Malaysia holds 49 per cent stake in the company and the Modi Group owned MCorp Global holds the remaining 51 per cent. Both Telecom Malaysia and MCorp Global are likely to dilute an equal stake prior to the IPO.

Subject to availability of spectrum, the company plans to roll out services by the middle of next year. While setting up fesh networks might be a tall order, the company has expressed its interest in being a mobile virtual network operator. However, current regulations do not allow that.

That's not all, the company also plans to get into retail in a big way send this article to a friendwith fully owned retail outlets, which will sell telecom products and services including Spice handsets. Dilip Modi says the company plans to have 1,000 such outlets by the end of 2009.

Gwalior Chemical to raise Rs 800 mn via IPO route

Gwalior Chemical Industries, one of the producers of niche chemical products in India for Agro-Chemicals, Pharmaceuticals, Dye and Flavours and Fragrance Industry, is planning for raising capital through an IPO.

To finance the growth plans, GCIL is entering the capital market to raise Rs 800 million through equity issue of face value of Rs 10 each at a fixed price to be decided later.

The company has taken initiatives in the past to value-add most of its by-products into sellable products such as sodium bi-sulphite, sodium benzoate and hydrochloric acid, as a result of which these products presently contribute 3.5% of net sales for fiscal 2006.

The company presently has a customer base of more than 515 customers across 9 industries in 40 countries. The net sales and adjusted profit after tax for fiscal 2006 was Rs 1700 million and Rs 155.9 million respectively as compared to a net sales and adjusted profit after tax of Rs 1360 million and Rs 130.2 million for fiscal 2005.

Saturday, September 02, 2006

DLF withdraws IPO prospectus; eyes re-filing in Nov

The much-hyped public issue of real estate major DLF Ltd faced yet another roadblock on Thursday with the company withdrawing its initial public offer prospectus with the market regulator SEBI.

DLF today said it has withdrawn the draft red herring prospectus for its planned IPO as the financial information furnished in the document had become outdated.

The IPO was being touted as the country`s biggest ever public issue with total proceeds from the sale of shares in the offer being pegged at as high as over Rs 15,000 crore in the market circles.

A company spokesperson said that the financial details in the prospectus needed to be updated due to the lapse of about four months since the filing.

She added that the company was likely to submit a new DRHP by November.

DLF expects to get a valuation much higher that what was stated in the previous prospectus, she added.

The company had filed the DRHP with Securities and Exchange Board of India on May 12 for its IPO.

"The kind of business we have done in the last four months has been significant," she said, adding that investors had a right to know the latest information about the company.

Given the lapse of four months since the filing and the company`s business expansion in this period, the company on advice of its bankers, has decided to update the DRHP with new financials and business developments, DLF said in a statement.

According to the prospectus, DLF had offered 20.2 crore equity shares of Rs two each for cash at a premium to be decided through the 100 per cent book building process.

According to the previous DRHP, the proposed issue constituted about 12.77 per cent of the fully diluted post-issue capital of the company.

However, after filing the prospectus, the company got embroiled in a controversy related to its minority shareholders, which is said to have delayed the IPO considerably.

The minority shareholders filed a complaint with the market regulator SEBI alleging that they did not receive the letter of offer of the debenture that the company issued in December last year.

However, the company has been consistently denying the allegations, saying that "SEBI has been kept fully and entirely informed of all the issues pertaining to the disaffected minority shareholders."

According to sources, DLF`s land bank has been valued at Rs 90,000 crore by Cushman and Wakefield, global realty consultants.

The company plans to use the IPO proceeds for acquisition of land and other investments.

The company is also looking at equity participation in hotel business for its foray into the hospitality sector.

The company has already issued 7 bonus shares against each held by the existing shareholders and split stocks of face value of Rs 10 into Rs 2 and placed 3.5 crore shares with foreign institutional investors or domestic institutional investors.

The company`s shareholders had approved these decisions at an extraordinary general body meeting (EGM) held on April 20.

Richa Knits IPO opens on Sept 13

Richa Knits has decided to make a public issue of 9 million equity shares of Rs 10 each for cash at a premium of Rs 20 per equity share at a price of Rs 30 per equity share aggregating to Rs 2700 lakhs (the issue).

The public issue also includes promoter`s participation of 1.5 million equity shares of Rs 10 each for cash at a price of Rs 30 per equity share.

The issue opens on 13 September 2006 and closes on 19 September 2006.

The company has decided to compulsorily allot 10% of the total issue, comprising 7.5 lakh equity shares to QIBs.

Besides, 7.5 lakh equity shares of Rs 10 each for cash at a price of Rs 30 per equity share would be reserved for NRIs/FIIs, while 3.75 lakh equity shares of Rs 10 each for cash at a price of Rs 30 per equity share would be reserved for the employees.

The net issue to the public stands at 5.62 million equity shares of Rs 10 each for cash at a price of Rs 30 per equity share.

The minimum application size is 180 equity shares and in multiples of 180 equity shares thereafter. The payment on application is Rs 15 and on allotment, it is Rs 15.

KJMC Global Market (India) is the lead manager to the issue and Intime Spectrum Registry would be the registrar to the issue.

United Bank plans IPO

United Bank of India, in an effort to restructure its capital base, is likely to go for an initial public offering (IPO) of an undisclosed amount soon, reports Business Standard.

The issue is aimed at converting Rs 12.32 billion of its equity base of Rs 15.32 billion into preferential share and perpetual bond. The bank has already submitted its proposal to the Reserve Bank of India.

The bank has also targeted business worth Rs 550 billion in the current financial year, up 23 per cent over last year. Moreover, it has plans to open 50 branches this year in north and central India.

RBI had allowed the bank to write off bad debt amounting to Rs 2.7144 billion against capital. This enabled the bank to pay dividend after a gap of 14 years.

By July, the bank had already managed to open 10,04,175 fresh accounts through its branch network.