AVR Valves to raise Rs 100 crore via IPO

Rajkot-based vales maker, AVR Valves Private Limited is planning to raise Rs 100 crore through the initial public offering (IPO) during the current financial year.

The company plans to setup an automatic valve manufacturing unit in the city.

"We are preparing for an IPO by the end of current financial year. The issue size will be around Rs 100 crore," said R K Jain, chairman of the company.

Currently, the company's valve manufacturing unit operates manually. However, AVR intends to set up a new unit with automatic machinery. "This would double our production. The entire process of setting up the new unit will take about two years of time," said Jain.

Talking about the new unit, Jain further said, "We will set up an automatic transport line unit in Metoda GIDC. It will be one of its kinds of unit in India and will reduce our production cost and also help us to survive manpower shortage."

With already a production capacity of one million valves per month, AVR Valves is targeting to double it by 2014 end.

AVR Valves also plans to acquire a US-based company for which the company is in talks. However, Jain refused to divulge details about the companies AVR is in talks with.

As against an investment of Rs 2-3 crore last year for expansion in the current unit, AVR Valves will be investing about Rs 70-80 crore for various expansions including setting up a new unit in Metoda.

Post IPO, the company expects its current turnover of about Rs 15-20 crore to touch Rs 50 crore after the commencement of new production line over the next two years.

With a manpower of 300, the company manufactures all types of intakes and exhaust engine valves for car, trucks, tractors, motorcycles, stationery diesel engines for agriculture and generating sets marine engines, heavy duty diesels and earth moving machines.