The Hindu Business Line : Beeyu Overseas may defer Rs 10-cr issue

PERCEIVED political uncertainty and the fluctuating stock market may force the city-based Beeyu Overseas Ltd to postpone its proposed rights-cum-public issue.

Beeyu Overseas, a leading tea and commodity exporter, was planning to come out with a Rs 10 crore rights-cum-public issue in September or October this year. Dialogue was also initiated with a number of merchant bankers.

However, the recent political development followed by the wide fluctuations in the stock markets might force the company to reconsider its decision for the time being.

According to Mr A.R. Basu, Managing Director, the management is closely watching the political development and its subsequent impact on the stock markets.

"Our stock markets are influenced by several sentiments. To make our issue successful, we will have to study these sentiments properly. The investors do not always judge the company's credentials properly. So we will have to time our issue accurately," Mr Basu told Business Line.

Beeyu Overseas is already listed at the Calcutta Stock Exchange. However, in an effort to increase the liquidity and availability of the scrip, it is planning to get listed in the NSE, for which it is trying to increase the capital base.

Last year, the company made a bonus issue of one equity share for every five shares held by its shareholders.

To accommodate the bonus issue, the authorised capital was also increased to Rs 7.25 crore from Rs 6 crore.

Meanwhile, the company is going ahead with its plans to set up India's first fridge dried coffee plant in Bangalore.

It will be a 100 per cent EOU with a total capacity of 3,000 tonnes per annum. The plant will produce powder and agglomerated coffee.

Fridge dried coffee is a highly sophisticated item but hardly has any market in India.

In fact, except Japan, no other Asian country produces this type of coffee. However, it fetches a premium of 30-40 per cent over powder coffee.

The total cost of the plant has been worked out to be Rs 50 crore, but the company will start only with the fridge dried coffee facilities. The capacity will be 1,200-1,500 tonnes per annum and will cost around Rs 30 crore.

The total project will be financed through a mixture of debt, equity and internal accruals. "We have just prepared a full project report of this plant and everything is going on as per schedule," Mr Basu said.

The coffee plant replaces the company's earlier plan of setting up a bought leaf factory at Siliguri in North Bengal, which was shelved due to poor tea prices.