Kaveri Seed eyes up to Rs 68 cr in IPO
Agricultural seed maker Kaveri Seed Co. Ltd. is eyeing raising up to Rs 68 crore through a 4-million share initial public offer, set to open next week, the company said on Thursday.
A price band of Rs 150-170 per share has been fixed for the issue that will constitute 27.74 per cent of the post-issue capital, the company said in a statement.
The funds raised will be used to buy farm land for research, set up corn cob drying plants in Karnataka and Andhra Pradesh, a biotechnology laboratory and a seed processing plant, both near Hyderabad.
A part of the money will also be used to upgrade existing seed processing units, the company added.
Anand Rathi Securities, Sobhagya Capital Options and SREI Capital Markets are the book running lead managers for the issue that is set to open on Sept 6 and close on Sept 11.
For 2006/07, Kaveri reported profit after tax of Rs 10.53 crore on total income of Rs 67.23 crore.
Kaveri Seed IPO receives 33% subscription on day one
Secunderabad-based Kaveri Seed (KSCL), maker of agriculture inputs, received 33% subscription for its initial public offer (IPO) on first day of issue. The IPO received 1,315,240 bids as against the issue size of 4,000,000 shares. A total of 9,360 bids were received at cut off price.
KSCL intends to deploy the issue proceeds in expansion plans worth Rs 632.97 million. It includes setting up of marketing offices and godowns, corn cob drying plants, biotechnology lab, and seed processing plant.
In addition, KSCL plans to acquire farmland for R&D facilities, upgradation of existing seed processing plants and meeting the working capital requirements. The benefits of these plans are expected to contribute to the financials of KSCL from November 2008 onwards.
Incorporated in 1986, Kaveri Seed is engaged in the business of production, processing and marketing of high quality hybrid seeds for different crops like corn, sunflower, cotton, paddy, grain sorghum, etc. Recently, the company forayed into micronutrients and bio-products. In addition, the company produces non-hybrid seeds. The production, processing and R&D facilities are located in Andhra Pradesh and Karnataka.