Hindustan Media Ventures Ltd, publisher of the Hindi daily Hindustan, today said it will raise Rs 300 through an initial pubic offer to fund its expansion programmes.
The company, a subsidiary of HT Media which publishes leading English daily The Hindustan Times, has already filed Draft Red Herring Prospectus (DRHP) for the maiden public issue and expects to come out with the IPO in the next three months.
"In the past two years we have been expanding rapidly in our existing markets, including Uttar Pradesh, Bihar, Uttarakhand, Jharkhand, National Capital Region. We intend to intensify this expansion, besides exploring new markets and hence, we are looking to raise about Rs 300 crore through the IPO," Hindustan Media Ventures Ltd CEO Amit Chopra told PTI.
He said since the company will be going through the book building process, the amount of stake dilution through the IPO will depend on the price band.
"We have filed only the DRHP and are yet to file the Red Herring Prospectus, so it's a bit early to say how much stake could be diluted in the IPO," Chopra said.
The company has a paid up capital of Rs 7 crore and net worth is estimated to be Rs 150 crore.
The proceeds of the IPO will be utilised in scaling up operations and to increase circulation of the paper in the existing markets, he said.
"At present, we have 15 printing locations in the states that we are present, of which six had been set up in the last two years. It shows the pace at which we are expanding," he said, however, declining to share details on future expansion citing regulatory restrictions.
"I can say that much that we will be expanding our printing capacity," he said.
Besides, Chopra said Hindustan Media Ventures Ltd (HMVL) may explore new markets in Hindi speaking states like Madhya Pradesh, Rajasthan, Haryana and Chhatthisgarh.
"Those markets are on our horizon but priority will be to strengthen our position in the markets that we are currently in," he said.
Chopra claimed that Hindustan is the third-largest circulated Hindi daily after Dainik Jagran and Dainik Bhaskar. It has a readership of 93 lakh and a daily circulation of 17 lakh copies (as per last data of July-December 2009).
HMVL also publishes two Hindi periodicals -- 'Nandan', a children's magazine, and 'Kadambini', a general interest magazine.
Asked if the company has plans to foray into the Hindi business newspaper segment, Chopra said: "At present that is not in our priority list, but as and when we think the market is ready for such niche publications, we will be ready to tap the opportunity."