Calcutta, Aug. 26: K.K. Bangur-controlled Graphite India Ltd will raise up to $50 million by way of global depository receipts or foreign currency convertible bonds.

The board today cleared the issue, which also requires shareholders’ approval. It has also okayed a proposal to increase the FII limits from 24 to 40 per cent.

Talking to The Telegraph, Bangur, chairman of the company, said the fund will be raised in one or more tranches.

“Once we have shareholders’ approval, for which an extraordinary general meeting has been called on September 26, we will decide on the issue size and other modalities,” he said.

The company is hopeful to wrap up the issue in 2-3 months following the EGM. It is in the process of appointing a merchant banker for the same soon.

The news augured well with the bourses as the Graphite India scrip gained 3.53 per cent or Rs 9.60 at the National Stock Exchange.

The fund mobilised by Graphite will be utilised to meet its present and future capital requirements.

“We are working out a business plan, which will be placed before the board soon,” Bangur said.

Recently, Graphite had acquired a company in Germany, and is looking out for more opportunities.

Bangur, however, clarified there was no binding offer before the company now.

Graphite has started expanding the capacity at its domestic and German facilities.

The company is spending Rs 160 crore to augment the Indian capacity of graphite products to 60,000 tonnes from 40,000 tonnes.

It will also double the capacity of the German facility to 20,000 tonnes at an investment of Rs 20 crore.

The expanded capacity at the Indian plant will be on stream from the third quarter, and at the same time the German expansion plan will be finalised. The development comes at a time when the prices of graphite products are on the rise.