Date:08/04/2006 URL: http://www.thehindu.com/2006/04/08/stories/2006040806141700.htm

Business

JRG Securities to go public on April 17

Special Correspondent

36.25-lakh equity shares to be on offer

KOCHI: JRG Securities Ltd. proposes to enter the capital market on April 17. The company is engaged in broking on equity and commodity markets, distribution of financial products, such as mutual funds, and direct broking of life and non-life insurance (through its subsidiary) products.

The public issue is for 36,25,000 equity shares of Rs. 10 each at a premium of Rs. 30 a share (issue price is Rs. 40 a share), aggregating to Rs. 14.5 crores. The issue closes on April 21.

T.M. Venkataraman, chairman of the company, told presspersons here recently that 4,27,500 of the shares on offer were reserved for non-resident Indians, leaving a net offer of 31,97,500 shares to the public. The equity shares were proposed to be listed on Bombay Stock Exchange.

Post-issue, the stake of the promoters would come down to 72 per cent, Mr. Venkataraman, a former chairman of the Thrissur-based Dhanalakshmi Bank, said.

The company proposes to invest the funds raised through the initial public offer in upgrading information technology infrastructure, establishing 30 regional offices and expanding overseas. The operational efficiency of its business is dependent on use of modern technology. Speed of executing orders and transparency in dealings are the key factors for its success, Regi Jacob and Jiby Mathew, directors of the company, said.

They said the company now had presence in 310 trading centres in the country, supervised by 12 regional offices. Another 1,200 centres were proposed to be established by 2008. This phase would allow it to extend reach in States such as Haryana, Gujarat, Rajasthan, Madhya Pradesh and West Bengal, they added.

The company's plans include formation of a wholly owned subsidiary company and a limited liability company in Dubai and securing memberships and approvals to start capital market operations in West Asia and secure membership of the DGCX. The limited liability company will be set up in collaboration with a Dubai resident, under UAE laws, with an initial capital of six million dirhams (Rs. 7.68 crores). Broking operations will be conducted by it on the Indian and international stock exchanges for the West Asia market.

The UAE partner will hold 60 per cent of the shares of the company, while JRG Securities hold the remaining 40 per cent.

The DMCC company will be a wholly owned subsidiary of JRG Securities Ltd. and will be established in the DMCC Free Zone. Under existing UAE laws, companies set up in free zones can be wholly owned by foreigners without any participation by UAE residents.

The subsidiary will be a registered member of the DGCX and will conduct commodities broking operations on the DGCX and source clients from West Asia, India, the U.S. and Europe, says a press release.