Gulshan Sugars & Chemicals to issue IPO

MUMBAI: Leaders in calcium carbonate production in the organised sector, Gulshan Sugars and Chemicals Ltd, will enter the capital market with its follow-on public issue of 66 lakh equity shares to part finance its expansion project worth over Rs 37 crore.

The shares with a face value of Rs 8 each will be at a premium of Rs 32 per share mopping up Rs 26.4 crore.

Of the remaining Rs 11 crore, Rs 8 crore will be term loan that has been sanctioned by IDBI and Rs 3 crore would be through internal accruals.

The issue opens for subscription on November 22, 2006 and closes on November 28, 2006.

"The company is raising the equity capital to part finance its plans to expand its capacity by setting up 20,000 tonnes per annum ground calcium carbonate unit and also an additional 3 MW captive power plant at its manufacturing facilities at Muzaffarnagar, UP," Company MD C K Jain told reporters here today.

The additional capacities will scale up the total capacity to 90,000 tpa and the project is expected to be comissioned by March 2007.

The issue would constitute 51.51 per cent of the fully diluted post issue paid up capital of the company.

The company came up with its Initial Public Offer in 1991.

For the financial year ended March 31, 2006 the net sales of the company were Rs 41.27 crore while the net profits were Rs 28 crore.

The company is a supplier to well known companies including HLL, Colgate Palmolive, ITC, Asian Paints, Berger Paints, Century Paper.