Visaka Industries to raise Rs 4.5 cr for expansion

Visaka Industries Limited, at its board meeting held here today, decided to go in for a placement of 3 lakh equity shares and 9 lakh convertible warrants of the company to private investors to raise money for funding the ongoing expansion plans.

The company intends to raise Rs 4.5 crore through the placement of these shares to meet the promoters' equity requirements for the new cement asbestos units.

Addressing the media, G Vivekanand, managing director of Visaka Industries, said the company's thrust now was on completing the two proposed cement asbestos plants at Vijayawada and Ahmedabad with an investment of Rs 32 crore each.

According to Vivekanand, the board of directors has also approved the merger of Shakti Roofings Private Limited with the company with effect from April 1, 2006. Shakti Roofings achieved a turnover of Rs 48.94 crore during the year ended March 2006, with a net profit of Rs 5.40 crore, according to a company press release.

With the cement asbestos' expansion capacity going on in full steam, the company would review the original plans of Rs 90 crore cotton spinning mill proposed by it in Hyderabad, Vivekanand said, indicating a revised time frame for the same.

Meanwhile, the company's spinning division registered a turnover of Rs 86.04 crore during 2005-06 as compared to Rs 71.71 crore in the previous year recording a gross profit of Rs 4.11 crore. The recently launched garment division registered a nominal turnover of Rs 69.13 lakh during the first 3-month of commercial production.

Vivekanand said the garment manufacturing unit in Chennai was receiving promising orders from Western buyers. A French company has tied up with the company's garment division to book 250 machines from July 2006 onwards. He said the garment unit was expected to get worldwide responsible apparel production (WRAP) certification from next month.