Guwahati, Oct 27 (UNI) After a gap of 11 years, the Barak Valley Cements Ltd (BVCL) will be the first company from the North East to enter the capital market with an Initial Public Offer (IPO) of 56,60,000 equity shares on October 29.
BVCL chariman K Chamaria informed at a press conference here today that the company planned to raise upto Rs 24 crore through the IPO in a price band of Rs 37-42 per share.
Underscoring that this would be the first IPO by a NE company since over a decade, he said, ''Sentiments are also related with the IPO of BVCL and we hope to draw good investment from the NE region.'' Analysing the reasons for NE companies not entering the capital market, Mr Chamaria said, ''Non-exposure to capital market is an important reason for this.'' On the problem of insurgency, he said the BVCL management had not faced any such hurdles and was registering good progress rate since it started production in 2001.
Elaborating on the issue, the BVCL chairman said the money raised would be used to part finance expansion of clinkerisation capacity from present 420 Tonnes Per Day (TPD) to 600 TPD, cement grinding capacity from 460 TPD to 750 TPD and investment in the 100 per cent captive six MW biomass based power project of the company at Badarpur in Assam.
The biomass-based power project would be the first of its kind in the NE and the agricultural waste would be used to generate power, which would also financially benefit the local farmers.
Mr Santosh Bajaj of the BVCL informed that about four million tonnes of cement were required in the NE annually and the local production was about 2-2.5 million tonnes, with the deficit being filled by cement brought from other parts of the country.
''There is a vast market locally and we plan to expand our capacity to meet the growing demand for cement,'' he added.
The BVCL has three wholly owned subsidiaries engaged in power generation, mining operations and cement manufacturing. The profit after tax for fiscal 2006 and 2007 were Rs 116 million and Rs 142.7 million respectively. For the quarter ended June, 2007, the profit after tax was Rs 36.2 million.