PTI[ SUNDAY, DECEMBER 31, 2006 02:15:28 PM]

MUMBAI: Kochi based spice processor and exporter Vallabhdas Kanji Ltd (VKL) is planning to tap the capital markets to raise Rs 75-120 crore for business expansion and for acquisition in the domestic market.

"Though it is premature to state the exact size of the IPO, looking at the growth in the foods sector, it should be between Rs 75 to Rs 120 crore," VKL MD Ajay Mariwala told media here.

The proceeds from the IPO may also be utilized to acquire a good domestic brand in our existing business and to make a foray in domestic retail segment by retailing out our own brands in spices and blends, he said.

VKL, a part of Rs 500 crore Kanji Morarji Group has recently set up VKL Vietnam Ltd, a subsidiary in Vietnam and expects to set up a facility there by May.

Company has invested close to Rs 16-18 crore for its Vietnam operations and will invest Rs 20 crore domestically in 2007-08 in the food ingredient, seasoning and supplying to private lables.

The Vietnam facility will have a capacity to process 20,000 tonnes per annum of both white and black pepper which would be utilized to export worldwide, he said. VKL currently has capacities to process 22,000 tonnes per annum of various types of spices located at its three manufacturing locations at Kochi.

It recently acquired Mumbai based Beeta Chemicals that is into flavours and fragrances for an undisclosed amount that will enable VKL's existing seasoning and private label business to deliver valu added benefit. The acquisition will also bring to VKL's product portfolio a separately marketable range of products that will extend to segments as colas, bakery, chocolates and retail and also fragrances, Mariwala said.

VKL had in October 2006 concluded a $6 million private placement with UTI venture funds. It is targetting to touch a turnover of Rs 150 crore by end of this fiscal and Rs 300 crore by end of fiscal 2007 and 2008.