V-Guard, one of India's leading electrical and electronic companies, is all set to enter the capital market with an initial public offer of around Rs 70 crores (Rs 700 million).

Announcing the IPO plans, V-Guard chairman and managing director Kochouseph Chittilappilly said on Monday that the issue is aimed at raising funds to augment production capacity, enhance research and development facilities and strengthen the market presence of the company across India.

V-Guard has appointed Anand Rathi Securities as the lead manager to the issue that is expected in October this year.

Along with the IPO, the company has chalked out an ESOP plan to the extent of 4% of the company's share capital. Promoters of V-Guard also plan to dilute a small portion of their stake to business associates a market-related price.

Addressing a press conference in Kochi, the headquarters of V-Guard, Chittilappilly said that the company is planning branch expansion across north India.

As part of increasing the production facilities, the company plans to invest Rs 20 crores in its present cable factory to set up a cable plant.

Beside, manufacturing units will be set up in Himachal Pradesh and Uttarakhancd with an investment of Rs 20 crores for the production of stabilizers, UPS, electric water heaters, fans and cables to meet the growing demand for V Guard products in the North Indian market.

The balance amount will be utilized for strengthening research & development wing and the distribution and service network.

V-Guard had a turnover of Rs 241 crores during 2006-07 and the company expects a 30-40 percent increase in revenue in the coming year.

"The projected turnover for the current financial year is Rs 320 crores and the target by 2010 will be Rs 600 crores," Kochouseph said.

V Guard has a wide range of products like voltage stabilizers, pumps, cables, fans, solar water heaters and UPS. A major player in its segment in the South Indian market, V Guard is planning to establish the same kind of market presence in the northern states.

V Guard enjoys a staggering 40 million plus customer base and an extensive business network of over 7000 retailers 100 distributors and service centers across India. Presently, the company employs over 700 people in its various units and offices and more than 3000 people indirectly in the vendor production centers.