Beeyu public issue in Feb

Kolkata based export and tea outfit Beeyu Overseas intends to come out with a public issue in February 2005 to fund a part of its expansion plan in tea.

The Beeyu board is likely to meet later this month to finalise the details of the issue. This would be its second public offering after February 2000.

Beeyu is planning to double the capacity of its tea factory in Ooty to improve price realisation as the tea industry has seen prices rising in last couple of months.

Beeyu company secretary R Chattopadhyay said the company was planning to double the paid up equity from the present level of Rs 7.02 crore to around Rs 14 crore.

"The company has not yet decided about the premium, but it shall try to mobilise around Rs 14-15 crore from the market," he said.

Beeyu stock is now in the Rs 18-22 band. Beeyu expected the overseas offer to raise a reasonable premium because of its track record.

"Beeyu has given two bonus issues in just four years - first a bonus of 1:10 in 2002 and then a 1:5 bonus in 2003," he said.

Beeyu made a net profit of Rs 29 lakh in the quarter ended September 30, 2004 on sales of Rs 8.5 crore.

Turnover for 2003-04 was around Rs 33 crore. Beeyu intends to double the capacity of its two bought leaf factories from present level of 3,000 TPA to 6,000 TPA.

The fund required for this expansion is around Rs 16 crore. The major portion of the fund required would come from the public issue.

"The price realisation in tea is improving so the board decided to double the capacity," he added.

Chattopadhyay said the company was in the process of adopting a tea growing village near Ooty. The entire tea production from the village will come to its factory.