Rs 4.34-Crore Issue From Weal To Hit Market Soon

Weal Infotech, which tapped the capital market with its Rs 1.32 crore IPO in April 2000, is knocking the equity markets' door once again, this time with a larger offering.

It has filed an offer document with Sebi to issue 43,42,500 equity shares of Rs 10 each at par to raise Rs 4.34 crore. While it tapped last time for a foray into the IT sector, this time it claims that the funds are required for funding a BPO project.

According to the offer document, the company is currently carrying out the BPO activities with a 50-seat capacity and it now proposes to expand the centre by adding another 300 seats.

 

The total project cost is estimated by the company at Rs 4.34 crore which will be totally mobilised through the public issue. Out of the present issue, 21,30,000 shares are reserved for mutual funds and institutional investors, while the net public offer stands at 22,12,500 shares.

Post-issue, the existing paid-up capital at Rs 5.22 crore will increase to Rs 9.56 crore. Promoters' stake will come down to about 38 per cent from 69 per cent now.

It may be noted that the company could not achieve the financial projections made during the IPO for the past two years. It projected a total revenue of Rs 9.1 crore and Rs 11.83 crore respectively for FY 2002 and FY 2003. However, it could just post Rs 72 lakh income for last fiscal and Rs 2.65 crore in the first ten months of the current fiscal. Similarly, net profit was projected at Rs 2.57 crore and Rs 3.45 crore, whereas actual figures were a net loss of Rs 37 lakh last year and Rs 49 lakh profit for the current year upto January.

The company also promised that it will open overseas liasion offices in Australia, Singapore and US, which did not materialise so far. It stated that there were orders worth $8 lakh on hand during the IPO time, which it failed to execute.