Avon Weighing Systems Limited, a company engaged in the business of selling weighing systems in India, proposes to enter the capital markets on 9th June 2008 with a public issue of 1,37,33,033 Equity Shares of Rs 10 each at par aggregating to Rs 1373.30 lacs. This comprises of promoters contribution of 38,96,633 Equity Shares aggregating to Rs 389.66 lacs, leaving a net offer to the public of 98,36,400 Equity Shares aggregating Rs 983.64 lacs constituting 59.33% of the post issue paid-up capital of the Company. The Issue closes on 12th June 2008. CARE has assigned IPO Grade 2 to the Issue. The Equity Shares are proposed to be listed on BSE. Keynote Corporate Services Limited is the Lead Manager for the Issue and Datamatics Financial Services Limited is the Registrar to the Issue.
The Company proposes to part finance its Rs 17.30 crore plan through the net proceeds of the Issue. The plan include setting up of facility for manufacturing of a range of weighing systems, open four showrooms for display and sale of its weighing systems in Mumbai, Delhi, Chennai and Hyderabad, and purchase of additional office premises in Mumbai. The project is proposed to be funded through IPO of Rs 9.83 crores, promoters contribution of Rs 4.36 crores, internal accruals of Rs. 0.50 crore and a term loan of Rs.2.60 crores from Bank of India.
The proposed manufacturing plant will be set up at Baddi in Himachal Pradesh with technical assistance from Tanita Corporation of Japan. Avon will be able to enjoy fiscal incentives provided by the Himachal Pradesh government for setting up plant at Baddi such as exemption of payment of Central Excise duty for 10 years, 100% income tax exemption for initial 5 years and thereafter 30% for further period of 5 years, Capital investment subsidy for 6 years @15% on their investment in plant & machineries subject to a ceiling of Rs. 30 lacs, Central Sales Tax @1%, Electricity Duty exemption on captive power generated from D.G set/Hydel unit upto 31/03/2009, Price preference upto 15% for SSI. The Company has acquired land and building admeasuring 20982 sq. feet at Himuda Industrial Area, Bhatoli Kalan, Baddi, Himachal Pradesh for the proposed plant.
Avon is the authorised dealer and one of the distributors of Tanita and A&D products (weighing systems) in India since 1999. Tanita Corporation (Tanita) and M/s A&D Company Ltd. (A&D), both companies from Japan, are weighing scale manufacturers in their range of products. Weighing systems from both are renowned for their precision and consistency. These balances are particularly used in industries such as gems and jewellery, pharmaceuticals and chemicals, research and development laboratories, defense, etc, where precision weighing is critical.
Avon also provides consultancy to various industrial houses, on the latest weighing systems and applications and is focused on software to enhance the applications of weighing scales. Presently Avon is providing these services as a marketing tool for distributor of the products of Tanita and A&D. Avon has distributed its products to various industrial users such as Novartis India, Sudershan Chemicals Limited, Lupin group, Associated Capsules Limited, Palm pharma. Avon has provided consultancy services to various industrial users like Godrej Industries Ltd., Sudershan Chemicals, Acrow India Ltd., Cubernetik Technologies Ltd., Aprotech Engineers Ltd., Mass Engineers & Suppliers etc. for customizing the products as per their needs.
Avons total income for the year ended 31st March 2008 was Rs 52.14 crores as against Rs 40.17 crores for 2006-07 and PAT was at Rs 1.85 crores as against Rs 1.37 crores.