JHS Svendgaard Laboratories, a dental and oral healthcare products manufacturing company, is entering the capital market to part finance its expansion plans worth Rs 51.77 crore. The public issue of 67-lakh equity of Rs 10 each will open on September 26, 2006. The promoters are contributing for 5 lakh shares and remaining 62 lakh shares are reserved for public with a price band in the range of Rs 49 and Rs 58.
Nikhil Nanda, managing director, said, "Looking at the vast growth potential in the oral care market in India, the company is now setting up an integrated manufacturing facility at Kala Amb, District Sirmour in the State of Himachal Pradesh and increasing its capacity in its 100 per cent EOU at Noida. The total cost of the project is worked out to Rs 51.77 crore."
The company's expansion and new project are in an advanced stage of implementation and commercial production is expected to commence in December 2006. Post expansion the annual installed capacities of all products will increased substantially toothbrushes from 40 million units to 116 million units; toothpaste from 450 tonnes to 2700 tonnes; denture cleaning tablets from 5 million units to 180 million units and other oral care products from 60,000 litres to 5 lakh litres.
Nanda pointed out that the company's strategy includes being the preferred contract manufacturer to the retail chains in India as well as those planning to enter the Indian market. This shall provide the company with a ready platform to allow retail giants replicates the model of international market by selling products in their stores under their own brand name. The company's turnover of the year ended March 2006 touched to Rs 36.93 crore and it earned a net profit of Rs 4.03 crore.
UTI Bank Ltd, Centrum Capital Ltd and Bajaj Capital Ltd are the Book Running lead managers to the company's issue.