Everest Kanto to invest in Chinese subsidiary
Mumbai, May 18: Following the setting up of a wholly-owned subsidiary in Dubai, Everest Kanto Cylinder Limited plans to set up another one in China at an outlay of USD 50 million in Phase I.
The total investment in the Chinese venture is pegged at USD 75 million.
Everest Kanto, a leading manufacturer and exporter of high-pressure gas cylinders, is eyeing the high-potential Chinese market and has drawn up ambitious plans to tap that market through its proposed wholly-owned subsidiary.
In a press release issued here today, the Company stated that its manufacturing facility will be set in Tianjin and will possess a manufacturing capacity of 1.5 million cylinders annually.
''China has a huge potential and is one of the largest automotive markets in the world after the US and Europe,'' said Company Chairman and Managing Director Prem Khurana, adding, ''Our subsidiary in Dubai will begin production by September of this year.'' The Chinese venture will be funded through either or a combination of private placements, global depository receipts (GDRs) and Foreign Currency Convertible Bonds (FCCBs), stated the release.
Everest Kanto, which is a major exporter of CNG cylinders to the Middle-East, Iran, Pakistan, Bangladesh, Thailand and Malaysia, registered a robust 135 per cent rise in its net profit at Rs 33.49-crore for FY 06 while its sales grew by 78 per cent at Rs 235.50-crore.
The Company's Board of Directors has announced a dividend of 35 per cent, stated the release.