The Hindu Business Line : Dynemic plans IPO

THE Ahmedabad-based food grade dyes manufacturer Dynemic Products Ltd is tapping the stock market with a Rs 15.47-crore initial public offering in January.

The company is offering 44.21 lakh shares of Rs 10 face value at a premium of Rs 25 per share to the investors. The equity on offer constitutes 39 per cent of the total paid-up capital of Dynemic while the promoter group will continue to hold the rest, the Managing Director, Mr B.K. Patel, told Business Line. The funds will be used for the proposed Rs 18-crore backward integration project through which Dynemic intends to manufacture raw materials and replace its gas boiler with a wood or lignite boiler to reduce costs.

The company is spending Rs 13 crore to set up three new plants to manufacture food colours and lake salts, primarily for the export market.

Dynemic has its manufacturing facilities at Ankleshwar in south Gujarat. Dynemic recorded a total income of Rs 27.76 crore and a net profit of Rs 20 crore in 2004-05. The food dyes industry in India is largely concentrated in the unorganised sector and its size is estimated at Rs 2,400 crore.

The company has appointed Centrum Capital Services to manage the public issue, Mr Patel said.

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