Avon Weighing Systems, a company engaged in the business of selling weighing systems in India, proposes to enter the capital markets on June 9, 2008 with a public issue of 1,37,33,033 equity shares of Rs 10 each at par aggregating to Rs 1373.30 lakh. This comprises of promoters’ contribution of 38,96,633 equity shares aggregating to Rs 389.66 lakh, leaving a net offer to the public of 98,36,400 equity shares aggregating Rs 983.64 lakh constituting 59.33% of the post issue paid-up capital of the company.
The issue closes on June 12, 2008. CARE has assigned “IPO Grade 2” to the issue. The equity shares are proposed to be listed on BSE.
Keynote Corporate Services Limited is the Lead Manager for the Issue and Datamatics Financial Services Limited is the Registrar to the Issue.
The company proposes to part finance its Rs 17.30 crore plan through the net proceeds of the issue. The plan include setting up of facility for manufacturing of a range of weighing systems, open four showrooms for display and sale of its weighing systems in Mumbai, Delhi, Chennai and Hyderabad, and purchase of additional office premises in Mumbai. The project is proposed to be funded through IPO of Rs 9.83 crores, promoters contribution of Rs 4.36 crores, internal accruals of Rs 0.50 crore and a term loan of Rs 2.60 crores from Bank of India.
The proposed manufacturing plant will be set up at Baddi in Himachal Pradesh with technical assistance from Tanita Corporation of Japan. Avon will be able to enjoy fiscal incentives provided by the Himachal Pradesh government for setting up plant at Baddi such as exemption of payment of Central Excise duty for 10 years, 100% income tax exemption for initial 5 years and thereafter 30% for further period of 5 years, Capital investment subsidy for 6 years @15% on their investment in plant & machineries subject to a ceiling of Rs 30 lacs, Central Sales Tax @1%, Electricity Duty exemption on captive power generated from D.G set/Hydel unit upto 31/03/2009, Price preference upto 15% for SSI.
Avon is the authorised dealer and one of the distributors of Tanita and A&D products (weighing systems) in India since 1999. The company also provides consultancy to various industrial houses, on the latest weighing systems and applications and is focused on software to enhance the applications of weighing scales.
Avon’s total income for the year ended March 31, 2008 was Rs 52.14 crore as against Rs 40.17 crore for 2006-07 and PAT was at Rs 1.85 crore as against Rs 1.37 crore.