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Insecticides India to raise Rs 70 cr

Insecticides India to raise Rs 70 cr
PTI
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First Published: Wed, Aug 31 2011. 02 57 PM IST
Updated: Wed, Aug 31 2011. 02 57 PM IST
New Delhi: Insecticides India plans to raise about Rs 70 crore through qualified institutional placement of shares or a private equity (PE) infusion for funding its proposed capacity expansion programme, which includes setting up a new plant in Rajasthan.
The company, which has five plants in Rajasthan, Jammu and Gujarat, is in talks with PE firms and other institutional investors to raise funds. “We are planning to increase the capacity of our existing plants and also set up a new plant in Rajasthan. This will involve an investment of about Rs 60-70 crore,” Insecticides India Ltd managing director Rajesh Aggarwal told PTI. The company is looking to finance the expansion plans through Qualified Institutional Placement (QIP) or private equity funding, he said.
Aggarwal said the company would issue fresh shares to raise funds, which would dilute the promoter’s stake. “Promoters have about a 75% stake in the company. We would like to keep a two-thirds stake in it,” he added.
Aggarwal said the company has just completed one round of expansion at an outlay of Rs 80 crore with internal accruals and “we do not want to put more pressure on our cash flow”.
Under the proposed expansion programme, the company would ramp up its formulations production capacity to 5 lakh tonnes per annum from the current 3.5 lakh tonnes, while its technicals (basic chemicals) production capacity would be increased to 22,000 tonnes from 12,000 tonnes at present.
Insecticides India is scouting for land for its third plant in Rajasthan, Aggarwal said. The company has a presence in almost all parts of the country.
Maharashtra, Andhra Pradesh, Karnataka and Tamil Nadu contribute about 40% to the company’s turnover, which stood at nearly Rs 480 crore last fiscal. Its net profit was Rs 32.21 crore in the 2010-11 fiscal.
Insecticide India’s turnover grew by 20%, while its net profit rose by 14% in the 2010-11 fiscal vis-a-vis the previous year.
About one-third of the company’s revenues come from four products - Monocil, Lethal, Victor and Thimet. The company had recently acquired insecticide brand Monocil from Nocil Ltd.
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First Published: Wed, Aug 31 2011. 02 57 PM IST