Color Chips plans 1:1 rights issue

Company to invest around Rs 2 crore in proposed Philippines unit

Hyderabad-based Color Chips India Limited, an integrated design solutions company focused on graphics and animations, is planning a 1:1 rights issue in the next couple of months.

The company is also planning to invest around Rs 2 crore in its proposed wholly-owned subsidiary in Philippines.

Speaking to Business Standard, Sudhish S Rambhotla, chairman and managing director of Color Chips India Limited, said: "Though we have not yet decided on the size of the rights issue, we would be launching it in the next three to four months."

"Proceeds from the rights issue is for the capital expansion requirements and for taking up in-house production," he added.

Color Chips is the only Indian company with intellectual property rights (IPRs) for 100 characters. "We are planning our own in-house production with these characters," Rambhotla said.

Color Chips, which started operations in 2000, had incurred losses during the last three years and for the first time made a net profit of Rs 25 lakh for the financial year ended on March 31,2004.

The company expects its turnover to increase from Rs 7 crore to Rs 15 crore during the financial year 2004-05. It also expects the net profit to increase to Rs 2.5 crore during the current financial year.

"The new unit which we are planning in Philippines will help us in manpower sourcing," Rambhotla said.

Around 50 consultants from Philippines, who have already been appointed for the new unit, are at present working with the company in the city. According to Rambhotla, the senior management at the Philippines units would be Indians.

Rambhotla said that the company at the moment has Rs 9 crore worth of projects and another Rs 9 crore worth of projects are in the pipeline.

Color Chips which has just finished a 13-episode animated serial for French production house Benj Productions, is working on a 26-episode animated serial for BKN Kids, a German production house.

The company which has 350 employees plans to increase it to around 700 during the current fiscal to meet the increase in the number of projects. The company at the moment is working with 20 clients in comic publication and has five international clients and five for animation in the country.

"The animation industry in the country is at a nascent stage and we expect it grow in the next couple of years," Rambhotla said.