Our Bureau

Kolkata, Nov. 7

Himadri Chemicals & Industries is issuing warrants and equity shares to fund its acquisition in China and capacity expansion at home. It has planned to raise additional funds of Rs 145.34 crore through issue of 60 lakh equity shares of Rs 10 each at a price of Rs 229.25 per share and issue of 3.40 lakh warrants of Rs 10 each, carrying a right to apply for one equity share of Rs 10 each, at a price of Rs 229.25 per share within a period 18 months from the date of issue.

Of the issue, Citigroup Venture Capital International Growth Partnership Mauritius Ltd would get 45 lakh shares and 2.55 lakh warrants. Three promoter-controlled entities and five non - promoter entities (investment trusts) would get the rest of the equity and warrants. It has also proposed to increase in authorised capital from Rs 26 crore to Rs 33 crore.

The shareholders approval has been sought to clear the proposals at the extraordinary general meeting on November 19.

It is understood that the company is negotiating with two Chinese coal tar pitch manufactures for acquisition.

According to industry sources, the coal tar pitch, which is used for producing graphite for alumina smelters, is currently facing a global shortage. The Chinese technology, though costlier than Indian, would could fetch profitable margins in view of strong ruling prices of the product.

Himadri is also setting up a new plant at Korba in Chhattisgarh, the commercial production of which is expected to start by March 2007. The commercial production of the expanded capacity (50,000 M/T) at its existing facility has commenced and the full impact expansion will be reflected in the financial year 2006-07. Meanwhile, commercial production at its by-product plant at Mahistikry, in West Bengal begun in March 2006. The company has also undertaken to set up another plant at Visakhapatnam for coal tar distillation.

Himadri Chemicals stock saw increased traded volumes on the BSE today at 99,424 shares against 75,456 shares of daily average quantity in the past fortnight.

(This article was published in the Business Line print edition dated November 8, 2006)
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