Crest Set For $10 M GDR Float To Fund Expansion

Mumbai: | Updated: Sep 22 2003, 05:30am hrs
Crest Communications Ltd will raise up to $10 million via issue of global depository receipts (GDRs).

It plans to use the proceeds of the issue to fund expansion, retire debt, and to meet working capital needs. The companys debt is $2.5 million. We plan to double our capacity. We also intend to retire at least part of our debt, said Crest Communications vice-president, corporate strategy and finance, Abhay Bhalerao.

The company is in the process of appointing lead managers to the issue by the end of the month, said Mr Bhalerao. The nature of our business would be understood more in the international market. It would also be a diversification for us as we are already listed in India, he added.

Crests revenue primarily comes from the animation business. Animation accounted for Rs 3.65 crore out of total net sales of Rs 4.15 crore in the first quarter of this financial year. The company plans to expand its hardware and software facilities, besides doubling its staff strength.

The company has bagged a 26-episode TV series contract called Jakers! which is running on PBS, a leading network in the US. Crests focus is on computer-generated animation aimed at the mainstream entertainment market in the US. It is an interesting business if you are with the right clients. Our strategy is to get into the high-end of the animation business, he said.

Crest is doing a 13-episode TV series Tenali Rama which is being co-produced with Mediacorp TV 12, a government-owned broadcaster in Singapore. We will have rights for India while the co-producing partner will have it in Singapore. For the rest of the world, we will take 80 per cent of the revenues generated. It is a residual risk model, he said.

The company also does pure outsourcing animation work. Original content is also part of the business model. RichCrest Animation, USA, is a subsidiary which does original content production.