PRAKASH WOOLLEN & SYNTHET Share price

The Company was incorporated an the 23rd August 1979 as aPrivate Limited Company under the name and style of PrakashWoollen Mills Private Limited and took aver Prakash WoollenWeaving Factory Moradabad a Partnership Concern on the1st September 1979. The Company took over 16 powerlooms fromM/S Prakash Weaving Factory Moradabad and the businesswas commenced initially with a facility for weaving woollenblankets from woollen yarn purchased from the open market.The finishing of blankets was carried out on a job-workbasis. Sales in the first year of operation amounted toRs.5.54 lacs. Subsequently additional looms wereacquired in a phased manner raising the capacity to 40looms. The total turnover of the Company also increased toRs.271.77 lacs in 1990In February 1990 the Company imported two Carding Machinesand purchased 1800 spindles by obtaining financialassistance tram State Bank of India and a third CardingMachine was purchased in 1993. The Company consequentlyacquired an installed capacity at 10 lac Kg. p.a. formanutacture of Yarn. Prior to installation at its owncapacity for manufacture of woollen yarn the Company''s yarnwas manufactured on job- work basis by M/s. PrahladIndustries a family partnership concern which has acapacity of 9 lac kg. p.a and 1800 spindles. With effectfrom 1993-94 the Company has taken this capacity also onlease thus raising the installed capacity for manufactureof Yarn to 19 lac kg. p.a. The acquisition of the abovecapacities has resulted in the Company''s turnover rising toRs. 756.36 lacs for the year ended 31.3.1994.The Company was converted into a Public Limited Company bypassing a Special Resolution in the Extra-Ordinary GeneralMeeting held on the 1st April 1993 and obtained a freshCertificate for change at the name on conversion on the the14th May 1993 from the Registrar at Companies UttarPradesh Kanpur. The Company had revalued its Fixed Assets in March 1994details at which have been incorporated elsewhere in theProspectus.With a view to diversity its activities the Company hasentered into a technical collaboration with B. S.Corporation South Korea for manufacture of Acrylic MinkBlankets with an installed capacity of 4.32 lacs pieces perannum.Rationale for Diversification: The Company proposes to manufacture Acrylic Mink Blanketswith an installed capacity of 432000 pieces per annum.The proposed diversification is synergic to Company''sexisting line of operation for manufacture of woollenblankets. Moreover the Promoters have wide experience inthe field of manufacturing and marketing blankets. Thisdiversiticatian will provide for more value addition andincreased profitability. The Plant & Machinery andTechnical Know-how is t be acquired from M/sB.S.Carporatian of South Korea.The Company will be exporting finished blankets through itsexisting network of Dealers in the trade in Middle East. TheCompany has already received enquiries from the Dealers inthe Middle East of their possible demand and requirement. The Company has taken necessary steps to implement itsproposed diversification project and the present statusat the various steps taken in this regard are as under:i) A Term Loan of Rs. 370 lacs has already been sanctionedfor the project by the Company''s banker the State Bank ofIndia Lucknow Local Head Office. ii) While the diversification project is being setup on theland available with the Company at its existing siteadditional land admeasuring 8 bighas as mentionedelsewhere in the Prospectus has also been acquired to meetits future requirements if any.iii) The construction at the building for the proposedproject has already started and 50% of the construction hasalready been completed by the fourth week of August 1995.iv) The Plant and Machinery to be used in the project havebeen identified and orders therefor have also been placedwith B.S. Corporation South Korea for which an advancedpayment a US $ 50000 has been made. The machinery hasalready arrived at Bombay Port.v) Sanction has already been obtained from U.P. StateElectricity Board for the required power.vi) The Company has received no objection certificate fromU.P. Pollution Control Board Lucknow for obtaining therequired "No Objection Certificate".