Kiri Dyes and Chemicals has filed its DRHP with SEBI on 4th September 2007. It has planned a public issue of 50,00,000 equity shares of Rs 10 each for cash at a price to be decided through the book building process. The company is also considering a Pre-IPO Placement of upto 12,50,000 Equity Shares with certain investors. And if that happens, then the net issue to the public will be of 37,50,000 equity shares.
The BRLM to the issue is Centrum Capital. The shares are proposed to be listed on the BSE and NSE.
Kiri Dyes, one of the top 10 producers of reactive dyes globally in terms of volume and quality, is an Ahmedabad based company, has been in the business of manufacturing Reactive Dyes since past 9 years. The promoters of the company have 40 years of experience in the chemicals business. The product range of company caters to textiles, leather, paint and printing-ink industries.
It currently has a total production capacity of 10800 MTPA. As part of its new plans, Kiri Dyes is diversifying to manufacture sulphuric acid, oleum, chloro-sulfonic acid and basic chemicals. The diversification project envisages setting up of a Rs 42.67 crore plant for producing sulphuric acid and its derivatives, with an installed capacity of 500 metric tonnes a day. The plant is expected to commence operations by June 2008. The company is setting up the plant with latest double absorption technology and a power plant of the capacity of 2.9 MW, which can run from the steam generated by the Sulphuric Acid plant. It is also planning on capital expenditure for its existing dyes and intermediates unit at Ahmedabad and this is expected to cost Rs.6.69 crore.
The project cost is estimated around Rs.50 crore and it is to be funded mainly via the public issue and internal accruals. Posts issue, the promoters are expected to hold 66.57% of the equity.
For the year ended 31st March 2007, the company posted an income of Rs.133.76 crore of which Rs.88.55 crore was from exports and Rs.44.87 crore from domestic sales. Net profit stood at Rs.8.63 crore.
The Company sells its products to customers across various countries including Korea, Turkey, Indonesia, Taiwan, U.S.A, Canada, and other European countries apart from domestic sales. Approximately 40% of the raw materials used for production process are imported by the company and the same is being billed in US dollar; so it is very much exposed to the ongoing dollar fluctuations.