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Issue Open Date
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30-Sep-19
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Issue Closing Date
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04-Oct-19
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Application Money
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100
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Allotment Money
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Price Band
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55
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60
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Minimium Application No.
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240
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Issue Size (Shares)
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10000000
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Market Lot
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1
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Objective
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(a) Funding Working Capital Requirement(b) General corporate purpose
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Category
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No. of Shares
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No. of Shares
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Subscription Ratio
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Offered / Reserved |
Bid For |
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Non-Institutional Investors
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4000000
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7025760
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1.75644
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Qualified Institutional Buyers
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1000000
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1000080
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1.00008
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Retail Individual Investors
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5000000
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3178800
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0.63576
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Business Description
We are primarily into the business of production of sugar, alcoholic spirits by distillation including ethanol,blending and bottling of Indian Made Foreign Liquor (IMFL) and generation of power. Our Company has anintegrated sugar production facility located at Bellad Bagewadi, Belgaum District in North West Karnataka,which has been classified as a High Recovery Zone for sugar production by the Government of India.In the process of sugar production, by-products such as bagasse and molasses are produced which are used asraw materials to generate power and Ethanol/IMFL production respectively. The sugar unit of our integratedproduction facility first crushes the sugarcane to extract sugarcane juice which is then further processed toproduce sugar. After the sugarcane juice is extracted for further processing, the residual fibre i.e. Bagasse isutilized as fuel in the boilers to produce steam for running the turbines of our co-generation unit to generatepower. The molasses produced in the process of sugar production is fermented and distilled to manufactureEthanol and IMFL in the distillery unit of our integrated production facility.Bagasse, an ideal renewable source of energy, is burnt to generate steam in high pressure boilers to run turbinesfor generating electricity and steam for sugar processing. Our co-generation unit having an installed capacity of36.4 MW generates upto 29 MW of which 7 MW (approx.) is used for captive consumption. Out of the surplusof 22 MW, 14 MW is sold on a merchant sale basis under a Power Purchase Agreement with Tata PowerTrading Company Limited and the balance is presently being sold to Hubli Electricity Supply Company(HESCOM) under a long-term Power Purchase Agreement.Molasses, a by-product of sugarcane, is the primary raw material for making rectified spirit which is further redistilledto produce neutral spirit, the basic raw material for manufacturing IMFL products. The neutral spirit isthen blended to manufacture whisky and rum which is sold by our Company under the brand "Our Choice" inKarnataka. We are in the process of launching our brand "Your Choice" whisky which shall cater to therelatively upper segment of consumers in Karnataka. We launched the brand "Our Choice" in the year 2008 andin a short span of three (3) years our brand has established a preference with the consumers in the State ofKarnataka. To further add to the sales of our IMFL products, in March 2009, we entered into an arrangementwith M/s. SV Distilleries, Yelahanka, Bengaluru, a manufacturer of IMFL, to manufacture and sell our IMFLproducts in and around Bengaluru. This arrangement along with sale of IMFL products from our integratedproduction facility has lead to an increase in sale of our IMFL products from 2,56,100 Boxes in F.Y.2008-2009to 4,49,400 Boxes in F.Y. 2010-2011. As on the date of this Draft Redherring Prospectus, we are manufacturingand selling more than 100,000 boxes a month of our IMFL products.We also distill rectified spirit for manufacturing industrial Ethanol. We supply this Ethanol for blending withmotor spirit/petrol to oil marketing companies such as Indian Oil Corporation Limited, Bharat PetroleumCorporation Limited and Hindustan Petroleum Corporation Limited. We have entered into an arrangement in theyear 2010 with these companies for supply of approximately 4,200 KLs of Ethanol per annum and renewed thesame for a further period of one (1) year in 2011.We initially commenced distillery operations in the year 2001 with a capacity of 35 KLPD. The sugarproduction and co-generation facility started operations in the year 2006 with a capacity of 2500 TCD and 14MW respectively. With the continued support of the farming community in the area we were able to expand oursugar unit capacity from 2500 TCD to 5500 TCD in the year 2009. This further led to the enhancement in ourpower generation capacity from 14 MW to 36.4 MW.We now propose to expand our integrated production facility situated in Belgaum District by increasing thesugarcane crushing capacity from 5500 TCD to 11000 TCD. We further propose to install a new boiler of 150TPH capacity of 110 kg/cm2 pressure and a suitable turbine to our co-generation unit to enable us have a totalinstalled power generation capacity of 66.40 MW. From the proceeds of the Issue, we also propose to deploy apart of the funds as capital expenditure to expand the capacity of our distillery from the present 35 KLPD to 100KLPD leading to a n increase in our IMFL production capacity from 2500 Boxes per day to 5000 Boxes per day.Our income from the sugar business formed approximately 54%, 42% and 35% of our total sales in the F.Y.2011, F.Y. 2010 and F.Y. 2009, respectively, income from the co-generation business formed 9%, 7% and 27%of our total sales in the F.Y. 2011, F.Y. 2010 and F.Y. 2009, respectively income from the Distilliary businessformed 4%, 2% and 8% of our total sales in the F.Y. 2011, F.Y. 2010 and F.Y. 2009, respectively and whereas income from the IMFL business formed 32%, 43% and 27% of our total sales in the F.Y. 2011, F.Y. 2010 andF.Y. 2009, respectively.For the year ended March 31, 2011, we had a total income of `47,496.13 lakhs and net profit after tax of`4,300.32 lakhs as compared to total income of `41,528.53 lakhs and net profit after tax of `1,795.32 lakhs forthe year ended March 31, 2010.Our total sales have grown at CAGR of above 62.65% from `5,168.91 lakhs in F.Y. 2007 to `36,171.98 lakhs inF.Y.2011. Our PAT has grown at CAGR of 57% from `707.59 lakhs in F.Y. 2007 to `4,300.32 lakhs inF.Y.2011.
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Promoter's Holding
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Total Share Capital
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18735600
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Offered to Public
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10000000
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Promoter's Holding (Pre-Issue)
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54.22
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Promoter's Holding (Post-Issue)
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32.83
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Address |
Bellad Bagewadi
Taluka Hukkeri
Belgaum Dist,
Karnataka,
591105
Phone : 08333 251251
Email : info@vsil.co.in
Website : www.vsil.co.in
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Registrar |
Bigshare Services Pvt Ltd
Office No S6-2
6th Floor
Pinnacle Business Park
Next to Ahura Centre
Mahakali Caves Road
Andheri (E)
Mumbai
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Listed at |
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BSE, NSE
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Lead Manager |
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Aryaman Financial Services Ltd.
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Promoters |
Jayashree R Katti
Kush R Katti
Lava R Katti
Nikhil Umesh Katti
Ramesh Vishwanath Katti
Sheela U Katti
Sneha Nithin Dev
Umesh Vishwanath Katti
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