Five In­dian com­pa­nies get nod for IPO

The Pak Banker - - COMPANIES/BOSS -

As many as five com­pa­nies, in­clud­ing Ma­hana­gar Gas Ltd and Equitas Hold­ing Ltd, have re­ceived mar­kets reg­u­la­tor Se­cu­ri­ties and Ex­change Board of In­dia's (Sebi) ap­proval in the New Year to launch their ini­tial pub­lic of­fers (IPOs) to fund busi­ness ex­pan­sion and meet work­ing cap­i­tal re­quire­ments.

GVR In­fra Projects, GNA Axles Ltd and Maini Pre­ci­sion Prod­ucts Pvt. Ltd too have got green sig­nal from Sebi to float their re­spec­tive ini­tial share-sale pro­gramme, ac­cord­ing to data com­piled. To­gether, th­ese com­pa­nies are ex­pected to raise at least Rs.2,500 crore, peo­ple fa­mil­iar with the mat­ter said.

Most of th­ese com­pa­nies plan to utilise IPO pro­ceeds for busi­ness ex­pan­sion as well as work­ing cap­i­tal re­quire­ments. Be­sides, the firms are tak­ing the IPO route to achieve the ben­e­fits of list­ing the equity shares on the bourses. Some of the firms be­lieve the list­ing of the equity shares will en­hance their brand name and pro­vide liq­uid­ity to the ex­ist­ing share­hold­ers.

All the five firms, which had filed their draft pa­pers with Sebi be­tween Septem­ber and Novem­ber, re­ceived clear­ance from the reg­u­la­tor in Jan­uary, as per in­for­ma­tion avail­able with Sebi. Ac­cord­ing to Prime Data­base man­ag­ing di­rec­tor Pranav Haldea, the IPO mar­ket is ex­pected to see flurry of ac­tiv­ity in 2016 as there are 20 com­pa­nies that have se­cured Sebi's ap­proval to raise Rs.7,315 crore, with 11 still on the wait-list to mop up Rs.5,445 crore.

Be­sides, many more fil­ings are ex­pected in the near fu­ture, he added. Quan­tum AMC di­rec­tor I.V. Subra­ma­niam said, "IPO mar­ket will de­pend on the equity mar­kets sce­nario. Be­sides, pric­ing will play a cru­cial role." In 2015, there were as many as 20 main-board IPOs, which to­gether pock­eted about Rs.15,000 crore, mak­ing it the best pe­riod in the past few years in terms of fund rais­ing through such plans.

In com­par­i­son, six IPOs had hit the mar­ket in 2014 and gar­nered just Rs.1,261 crore, while three firms had launched their pub­lic is­sues in 2013 to mo­bi­lize Rs.1,284 crore. In­di­vid­u­ally, mi­cro­fi­nance in­sti­tu­tion Equitas Hold­ing's IPO com­prises fresh is­sue of shares worth Rs.600 crore and an equal amount by sell­ing shares to ex­ist­ing share­hold­ers, ac­cord­ing to peo­ple fa­mil­iar with the mat­ter.

Fur­ther, the firm is plan­ning to garner Rs.300 crore by sell­ing shares to in­sti­tu­tional in­vestors ahead of the IPO. GVR In­fra's pub­lic is­sue com­prises fresh is­sue of equity shares worth Rs.400 crore and an of­fer for sale, whereby IDFC Pri­vate Equity Fund would off­load 43.22 lakh scrips. Ma­hana­gar Gas' IPO would be of up to 24,694,500 equity shares. This in­cluded an of­fer for sale of up to 12,347,250 shares by state-run GAIL (In­dia) Ltd and of up to 12,347,250 shares by UK-based Bri­tish Gas Asia Pa­cific Hold­ings Pte Ltd.

The of­fer would also in­clude a reser­va­tion for el­i­gi­ble em­ploy­ees. The pub­lic is­sue of auto com­po­nents maker GNA Axles con­sists of up to 63 lakh shares with a face value of Rs.10 each. It has re­served two lakh shares for its em­ploy­ees. Maini Pre­ci­sion Prod­ucts' IPO com­prises fresh is­sue of shares to raise up to Rs.50 crore and an of­fer for sale of up to 30.30 lakh shares by its pro­mot­ers.

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