CavinKare to dilute 10 per cent stake to fund expansion plans

CavinKare has decided to dilute about 10 per cent stake for about Rs 350 crore to augment additional capacity expansion plans.

"We are in process of it (of raising funds). We are looking at 10 per cent stake (dilution) for about Rs 350 crore," CavinKare CMD C K Ranganathan said.

Ranganathan said the company was looking for an capacity expansion plan at its existing facility and would be required to make a "three digit" investment for it. "Everything I will inform you in May, when it is concrete...", he said.

Besides, the company which forayed into the hospitality business by launching restaurants under - "Vegnation", has exited from it, Ranganathan said.

The company had three Vegnation restaurants in Chennai.

"We have exited from that business. I think we had too many (products) in our hands and we were not able to make any margins from it (the business). We exited about a month ago," Ranganathan said.

Ranganathan said the company plans to expand its "Green Trends" and "Limelite" range of beauty salons to 350 branches across the country by 2015 at an investment of about Rs 80 crore for setting up its own parlours.

Stating that the hair and beauty salon industry was valued about Rs 7,000 crore, he said the company grew by 32 per cent year-on-year and "planned to invest about Rs 80 crore in next two years for setting up the salons".

He did not rule out the possibility of acquiring any existing beauty salon, saying "we will not shy away from it". Ranganathan said the firm would also open the beauty salons through franchise models apart from having its own outlets.

Giving a break up of the proposed expansion plans, Ranganathan said: "From the 350 outlets, 75 will be of Limelite range of salons. Focus will be on opening Lime Lite range of salons in metros while Green Trends in other areas".

With inputs from PTI