Indo Tech to raise funds to compete in 220 KV transformer segment

The margins made by transformer companies are higher in the 220KV transformer segment, compared to other ranges. This has made smaller companies look at entering this segment, which is dominated by five big players.

Addressing a press conference in connection with the Indo Tech Transformers' initial public offering, P S Jagdish, director, Indo Tech Transformers, said, "We currently manufacture transformers of up to 110 / 132 KV. There is a high demand for these class of transformers as well as 220KV class of transformers. Our company intends to set up a new plant at a new location with an installed capacity of 2,400 MVA per year at an investment of Rs 30.6 crore."

"The proposed plant would be capable of manufacturing 132 KV and 220 KV class of transformers. This would help us enter the power transformer segment and thus move up the value chain," he added.

With many software parks, hotels and hospitals coming up across the country, demand for dry type transformers has increased compared to oil-filled transformers which require a much larger space. Jagdish said that the company would be setting up a dry type transformer plant ranging between 100 KVA and 3,000 KVA at Thirumazhai complex.

The company has decided to modernise the manufacturing plant and upgrade the infrastructure in Saidapet.

The Chennai-based transformer maker will tap the capital market on February 10, 2006, with an issue size of 39.45 lakh equity shares of Rs 10 each at a price of Rs 130 per equity shares, aggregating Rs 51.2 crore. The issue closes on February 16, 2006.