The initial public offer by this Hyderabad-based company in February 1997 devolved by over 50 per cent on its lead managers, SBI Caps and IDBI, who picked up the requisite number of shares. SBI Capital Markets had picked up 9.07 lakh shares out of the unsubscribed portion of the issue. The rise in the stock price encouraged the merchant banker to offload a part of its stake and book profits. SBI caps has sold around 5.65 lakh shares (62.2 per cent) till date. SBI caps offloaded its holding in two tranches in late last year and the balance in May this year.

``We are also in treasury operations and booked profits when the opportunity came our way,'' saida senior official at SBI Caps. ``The stock has a lot of credentials and should do well once the company's operations stabilise,'' added the source at SBI Caps. The spurt in price during March-May this year was accompanied by a sudden jump in trading volumes as well. Trading volumes shot up in the last week of May, when more than 33.5 lakh shares were traded in eight trading sessions. The stock, after touching a high of Rs 23.4, dropped back to Rs 11 in June. The news of the company commencing its trial and commercial production has again pushed up the price to the current level of Rs 17.

The company had offered 3.85 crore shares at par aggregating Rs 38.5 crore shares to part-finance its Rs 281-crore project. The project had a debt content of Rs 171 crore. Rain Calcining's plans of project implementation went haywire when its par issue devolved in a dull market and later the project got delayed by almost eight months. The project finally started the commercial production in July this year against theprojection of November 1997. For the two months ended August, 1998, the company exported more than 32,000 tonnes of calcined petroleum coke (CPC) to the US at an average price of $142 a tonne. Another 30,000 tonnes will be exported in the next month.

As a result of the two-month delay and slow down in the aluminium sector, Rain calcining is unlikely to achieve the projected figures for 1998-99. The company's fortune are directly linked with the demand from the aluminium sector and about 400 kgs of CPC is required for each tonne of aluminium produced. The Company has set up a 100 per cent export oriented unit (EOU) for the manufacture of 250,000 tonnes per annum (tpa) of CPC, in Visakapatnam, AP. The project also has a power generation facility capable of generating an annual average of 41 MW of surplus power from the flue gases evolved during processing, calcination and combustion of GPC, which is being sold to industrial consumers or APSEB.

The company has entered into a technical assistance contractwith HIE, which will provide the technical and managerial advice to the company with respect to the design, engineering, construction, operation and maintenance of the power generation facility.