Nagreeka Exports to demerge its investment portfolio

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Nagreeka Exports is in the business of yarn dyeing, garmenting, cotton yarn and knitted fabrics. The company is demerging its investment portfolio into another company.

Managing Director of Nagreeka Exports , Sunil Patwari discusses the same, along with its business and the numbers it is eyeing for the future.

Excerpts from CNBC - TV18's exclusive interview with Sunil Patwari:

Q: Tell us about the yarn and the fabric business and how much each would contribute to your revenues? What do you expect your revenues to be this year?

A: We are primarily into the yarn business - we produce, outsource and export cotton yarns. We also export raw cotton. We hope to end 06-07 with around Rs 250 crore of revenues.

2007-2008 would be about Rs 325 crore. The growth would come out of the full utilization of the expansion and modernization that we have just completed and some growth in the trading segment.

Q: What kind of forays do you see yourself making in the yarn, dyeing, garmenting, fabric - any of the value added segments? How much would those segments contribute to your topline next year?

A: In 2007-08, the contribution from value added activities will not be much because we are presently just taking up implementing yarn dyeing and garmenting. Its full contribution is expected to come in the year 2008-09.

During 2008-09, we expect these two activities to contribute around Rs 50-75 crore to the topline.

Q:  You are also in the process of de-merging the investment portfolio into another company. Perhaps you could lay out this whole de-merger plan and what exactly the investment company will hold?

A: Presently, our company has an investment portfolio which is being de-merged into a new company. The process is presently awaiting a final order from the High Court, after which there would be some approvals from the Registrar of Companies, (RoC) and that we can expect in a month's time.

As part of this process, every shareholder of Nagreeka Exports will get a matching number of shares in the new company with a face value of Rs 5 and the face value on the shares of Nagreeka Exports will also reduce from Rs 10 to Rs 5. This new company will have an investment portfolio, which at the market value today, would be around upwards of Rs 250 crore.

Q: What exactly are those investments?

A: There are a number of them, but it is largely constituted by our investment in Sterlite Industries and a little bit in Sterlite Optical .

Q: By when do you expect this exercise to be completed?

A: Hopefully, sometime in January.