The IPOs to hit the primary market after Diwali are Tata Technologies, Gandhar Oil Refinery India Ltd, Fedbank Financial Services Ltd, Indian Renewable Energy Development Agency Ltd (IREDA IPO), Flair Writing Industries Ltd, Allied Blenders & Distillers Ltd, and Mukka Proteins Ltd.
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According Kris Arun Kejriwal, Founder, Kejriwal Research and Investment Services an advisory firm, Diwali season started with a bang, and had IPO’s over the last three days one after, and it appears that immediately after Diwali we will be back to square one with the number of issues tapping the market.
The biggest and most significant Tata Technologies IPO is scheduled to come soon; it is from the defence sector. Other companies in the banking sector include Fedfina, a Non-Banking Financial Corporation (NBFC) that specialises in financing gold loans and houses. Other companies include Gandhar Oil Refinery India, which is involved in the chemical industry, Flair, which specialises in writing instruments, and consumerware from the plastics segments.
Next, there’s a chance of Allied Blenders & Distillers (ABD) to come up its IPO, a company in the liquor business, which manufacture and market its own alcohol. A few other smaller IPOs for ₹200–250 crore are also possible to hit the primary market; Mukka Proteins is one of them. The Indian Renewable Energy Development Agency (IREDA), a government-affiliated organisation, which is responsible for financing renewable energy sources such as solar, wind, hydro, and so on. It finances both renewable energy and other sources of power, and it is in the league as PFC and REC. It supports the entire value chain in the power industry.
“Post Diwali the IPO frenzy is expected to continue with 5 new issues on offer which includes the highly awaited Tata Technologies IPO. While the 9.57 mn shares ($350-375 mn) of the Tata Technologies IPO is a 100% offering while the ₹175-200 crore, Mukka Proteins issue is a 100 fresh equity issue. Other issues being FedBank Financial Services ₹1,100 crore, Allied Blenders & Distillers ( ₹2,000 crore, Flair Writing Industries Ltd ₹745 crore and Gandhar Refining ₹500 crore. In my opinion, all the offerings have good business prospects. However the IPO pricing will be the key determinant of the subscription decision,” said Vinit Bolinjkar, Head of Research, Ventura Securities Ltd.
As these IPOs approach, let’s look into what to expect in terms of issue size, industry, business, peers, etc.
Gandhar Oil Refinery India Ltd IPO
Gandhar Oil Refinery India IPO opens for subscription on Tuesday, November 21, and closes on Thursday, November 23. The allocation to anchor investors for Gandhar Oil Refinery IPO is scheduled to take place on Monday, November 20, as per reports. Gandhar Oil Refinery IPO’s price band is awaited.
Gandhar Oil Refinery India Ltd IPO comprises a fresh issue of shares of up to ₹357 crore and an offer for sale (OFS) of up 12,036,380 equity shares of face value of ₹2 each by a promoter and others.
According to the Draft Red Herring Prospectus (DRHP), Promoter Ramesh Babulal Parekh, Kailash Parekh, and Gulab Parekh would each sell 2,250,000 equity shares.
The net proceeds from the new issue will be used by the company to finance the following: investing in Texol through a loan to finance the repayment or prepayment of a loan facility that Texol obtained from the Bank of Baroda; capital expenditure through the purchase of equipment and civil work necessary for the expansion of automotive oil capacity at our Silvassa Plant; expanding petroleum jelly capacity and the accompanying cosmetic product division at our Taloja Plant; expanding white oil capacity by installing blending tanks at our Taloja Plant; financing our company’s working capital requirements; and general corporate purposes.
The registrar for the Gandhar Oil Refinery India IPO is Link Intime India Private Ltd, while the book running lead managers are Edelweiss Financial Services Ltd and ICICI Securities Limited.
The company’s listed industry peers are Savita Oil Technologies Ltd (with P/E ratio of 8.25), Apar Industries Ltd (with P/E ratio of 25.71), Panama Petrochem Ltd (with P/E ratio of 9.49), Galaxy Surfactants Ltd (with P/E ratio of 35.37), Privi Speciality Chemicals Ltd (with P/E ratio of 47.21), Rossari Biotech Ltd (with P/E ratio of 42.00), and Fairchem Organics Ltd (with P/E ratio).
As per DRHP, the company is a leading manufacturer of white oils by revenue with a growing focus on the consumer and healthcare end-industries (Source: CRISIL Report).
Gandhar filed its draft prospectus in December last year. Gandhar Oil Refinery (India) received market regulator Securities and Exchange Board of India (SEBI’s) approval for its proposed IPO, in June.
Fedbank Financial Services Ltd IPO
Fedbank Financial Services Ltd IPO opens for subscription on Wednesday, November 22, and closes on Friday, November 24. The allocation to anchor investors for Fedbank IPO is scheduled to take place on Tuesday, November 21, as per reports. Fedbank Financial IPO’s price band is awaited.
Federal Bank arm Fedfina IPO comprises of fresh issue of equity shares up to the value of ₹750 crore and an offer-for-sale (OFS) of up to 70,323,408 equity shares by the promoters selling shareholders and promoter group make up the offer, which has a face value of ₹10 per equity share.
The Federal Bank, the promoter shareholder, may sell up to 16,497,973 equity shares, and True North Fund VI LLP, the other shareholder, may sell up to 53,825,435 equity shares, of the offer for sale up to 70,323,408 equity shares.
Federal Bank arm Fedfina is one of five NBFCs in India that have been supported by private banks.
ICICI Securities Ltd, BNP Paribas, Equirus Capital Private Ltd, and JM Financial Ltd are the Book Running Lead Managers (BRLM) to the issue, and Link Intime India Private Ltd is the registrar to the offer.
Federal Bank arm FedFina filed DRHP for an IPO last year. However, the company pulled out of it as it found the market conditions unfavourable. Now the company is reconsidering capital raising options after the lapse of earlier received regulatory approval, and filed papers with SEBI this July.
The company’s listed industry peers are Aptus Value Housing (with P/E of 27.04), IIFL Finance(with P/E of 14.52), Five Star Business Finance (with P/E of 31.73), Manappuram Finance Limited (with P/E of 7.28), and Muthoot Finance Limited (with P/E of 14.29).
Also Read: Federal Bank arm Fedfina files papers with SEBI for IPO
Tata Technologies IPO
One of the Street’s most-anticipated IPOs, Tata Technologies, a subsidiary of Tata Motors, filed an addendum with SEBI to its DRHP, in October. Tata Technologies would offer 9.57 crore shares in its planned IPO with a face value of ₹2 per share, according to the addendum filed with SEBI.
Tata Motors will sell up to 8.11 crore shares through an offer for sale as part of the Tata Tech IPO, Alpha TC will sell up to 9.71 crore shares, and Tata Capital Growth Fund I will offer up to 48.58 lakh shares.
Financial firms like JM Financials, Citi, and BoFA Securities have been chosen by the company to assist with the IPO process.
The company’s listed industry peers are KPIT Technologies Ltd (with P/E of 83.10), L&T Technology Services Ltd (with P/E of 40.92), and L&T Technology Services Ltd (with P/E of 70.67).
Indian Renewable Energy Development Agency Ltd IPO (IREDA IPO)
Indian Renewable Energy Development Agency’s IPO is first by a public sector enterprise after Life Insurance Corp.’s issue in May 2022.
The IPO will comprise a fresh issue of up to 403.16 million shares and an offer for sale (OFS) of up to 268.78 million equity shares by the President of India, acting through the ministry of new and renewable energy. The offer includes a reservation for subscription by employees.
According to the draft red herring prospectus (DRHP), the proceeds from the fresh issue will be used for augmenting its capital base to meet its future capital requirements and onward lending.
The company has appointed IDBI Capital Markets & Securities Ltd, BOB Capital Markets Ltd, and SBI Capital Markets Ltd as managers to the issue.
The company’s listed industry peers are REC Ltd (with P/E of 5.81), and Power Finance Corporation (with P/E of 4.52).
Also Read: IREDA files papers for IPO
Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.
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Updated: 11 Nov 2023, 06:46 AM IST