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Our Bureau

Price band has been fixed at Rs 90-108

EYEING NEW PASTURES: Ms Paru Jaykrishna, Chairperson, Asahi Songwon Colors Ltd, with Mr Gokul Jaykrishna, Executive Director, at a press conference to announce the company's IPO in Mumbai on Thursday. - Paul Noronha

Mumbai May 3 Asahi Songwon Colors Ltd (ASCL), a manufacturer of pigments, proposes to enter the capital market with an initial public offering of Rs 33.5 crore. The issue, which is being made through a 100 per cent book building process will open on May 9 and close on May 15.

The price band has been fixed at Rs 90-Rs 108 per equity share.

The company manufactures CPC Blue Crude and Pigment Green and has an installed capacity of 3,600 tonnes per annum and 1,200 tonnes per annum, respectively. The proceeds of the issue will be utilised to part finance the company's expansion plan of Rs 52 crore, which includes increasing the CPC Crude capacity to 10,800 MPTA, setting up a 1200 MPTA Pigment Beta Blue manufacturing facility and a 2 MW captive power plant.

DIC investments

Japan-based Dainippon Ink and Chemicals (DIC) has recently invested Rs 10.5 crore on acquiring 8,65,200 equity shares of ASCL for Rs 122 per share. DIC would hold around 7.5 per cent stake in the company after the IPO.

The balance cost of the project is being funded by a term loan of Rs 8 crore from SBI Bank. Post issue, the promoters stake will come down to 59-60 per cent.

"We are concentrating on exports. More than 90 per cent of our topline comes from exports," said Mr Gokul Jaykrishna, Executive Director, Asahi Songwon Colors Ltd.

The expansion (except the power plant) is expected to be completed by November 2007 while the power plant will be installed by March 2008.

Fortune Financial Services Pvt Ltd is the book running lead manager to the issue.

More Stories on : IPOs | New Projects | Dyes & Pigments

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