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Adhunik Metaliks plan Rs 100 crore IPO to finance Phase II expansion

Written by: Staff

Mumbai, Mar 6 (UNI) Adhunik Metaliks Ltd, part of Kolkata-based Adhunik Group, will enter the capital market with an Initial Public Offering (IPO) of equity aggregating Rs 100 crore to part finance the Phase-II expansion project estimated to cost Rs 437.36 crore.

Briefing newspersons here today, Manoj Agarwal, Managing Director and CEO, Adhunik Metaliks, said: ''Our plans are to set up an integrated steel plant with complete backward and forward linkages.'' In effect, he said the company will be involved right from iron ore and coal mining to manufacturing a range of steel products, including auto grade steel.

Mr Agarwal said, ''We have planned to implement the Adhunik Metaliks project in three phases. Of this, the first phase is on stream, while the second phase expansion would go in for implementation shortly and we expect to complete the entire project by 2008-09.'' As part of the expansion-cum-forward integration of operations, he explained, the company plans to set up the second SMS with vacuum degassing plant, rolling mill, argon-oxygen degassing plant with ferro alloy division, second captive power plant, sinter plant, oxygen plant, a private railway siding and captive iron ore and coal mining.

To a query, Mr Agarwal said the Phase-II expansion would cost the company estimated Rs 437.76 crore, term loans account for Rs 284.29 crore, internal accruals Rs 53.07 crore and the remaining from the proceeds of IPO amounting roughly Rs 100 crore. The issue price of the equity shares of Rs 10 each for cash at a premium to be decided through 100 per cent book-building process has been fixed between Rs 37 and Rs 42.

The issue opens for subscription/bids on March 13 and closes on March 17. Following the issue, the promoters' shareholding in the company would stand diluted by 25 per cent and the company proposes to list the shares on Bombay Stock Exchange and the National Stock Exchange.

The book-running lead managers to the issue are SBI Capital Markets and Karvy Investor Services.

Currently, Adhunik Metaliks produces high quality sponge iron, pig iron, special grade high carbon and low carbon steel billets and different grades of alloy steel billets.


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