The Hindu Business Line : Chemfab promoters to trim holding to 75 pc

Looking ahead
The board of directors recommended a final dividend of Rs 3.75 per share of Rs 5 each (75 per cent).
The company targets Rs 125 crore turnover for the current year, which would include about Rs 25 crore from selling its patented hollow-fibre membranes.

Chennai , April 7

The promoters of Chemfab Alkalies Ltd will (need to) sell around 3.80 lakh shares of the company, to bring their holding down to 75 per cent, so that the public holding in the company is at least 25 per cent — the minimum required for a company to be listed.

Promoters' stake in the company has increased during the year from 72 per cent to 78 per cent, because of the merger of a group company, Membrane Technologies Ltd with Chemfab Alkalies.

As per SEBI guidelines, the promoters are required to sell the shares only to institutional buyers — mutual funds, qualified institutional buyers or domestic or financial institutions or foreign institutional investors. Meanwhile, the company's board of directors today recommended a final dividend of Rs 3.75 per share of Rs 5 each (75 per cent). Earlier, the company had paid an interim dividend of Rs 2.5 for a share of Rs 10 each (25 per cent), before the stock was split.

In 2005-06, Chemfab Alkalies achieved a turnover of Rs 95 crore and a net profit of Rs 14 crore but the figures included the business of Membrane Technologies Ltd. The merger was cleared by the courts recently, but takes effect from April 1, 2005. In 2004-05, Chemfab achieved a turnover of Rs 74 crore and a net profit of Rs 9 crore.

Speaking to Business Line today, the Chairman and Managing Director of the company, Dr C.H. Krishnamurthy Rao, said the company had set itself a target of Rs 125 crore for the current year, which would include about Rs 25 crore from selling its patented hollow-fibre membranes.

Desalination plant

He said a committee formed by the Pondicherry Government to look into the environmental aspects of a desalination plant proposal of Chemfab Alkalies, had given a favourable report.

The Government, after having cleared the project through a Government Order, had announced setting up of a committee to look into the project, upon protests from the local fishermen.

Today, Dr Muthiah Mariappan, former Vice-Chancellor of Bharatidasan University and a Director with Central Leather Research Institute, joined the board of Chemfab Alkalies.

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