AEC (India), a Delhi-based company, executes complete turnkey projects for water pumping stations, sewage pumping stations, electrical sub-stations, switch yards, HT/LT electrification, etc.
The company had a share capital of Rs 6.15 lac in 1986. It raised an amount of Rs 73.85 lac in equity capital in Oct.'86. To part-finance diversification into a 100% EOU to manufacture various types of cotton dressings, the company brought out a Rs 15.45 cr rights-cum-public issue in Nov.'93. A technical collaboration and 100% buyback arrangement has been entered into with Ho Sung Co, South Korea. Ho Sung took up 8% of the post-issue equity stake in the company. The chairman of Ho Sung has also been appointed director of AEC.
The EOU commenced commercial operations from Oct.'94, and has become the major source of sales and profits for the company. Its subsidiary, AEC Enterprises (engaged in trading), is now setting up a 100% EOU to manufacture acrylic yarn/acrylic blankets with a capacity of 6000 tpa and 1.2 mln respectively.
To be located at Pithampur, MP, the estimated project cost of Rs 65 cr is being met through equity of Rs 60 cr (premium : Rs 10) and term loans of Rs 5 cr. A technical-collaboration-cum-buyback agreement has been entered into with Taihwa, South Korea.
Acrylic yarn to be manufactured by the company will be captively consumed in the manufacture of acrylic blankets. The company is banking heavily on the collaborators to sell its output of acrylic blankets in the export market. Traditionally, in the West, people prefer woollen blankets, but due to the steep increase in the price of wool, there has been a gradual shift to acrylic/wool blended and acrylic blankets.