Gandhar Oil Refinery India IPO opens on November 22, fresh issue component at Rs 302 crore

Gandhar Oil Refinery India IPO opens on November 22

White oils manufacturing company Gandhar Oil Refinery India will launch its initial public offering for subscription on November 22. This would be the third offer opening next week, after Indian Renewable Energy Development Agency, and Tata Technologies.

The price band for the issue, which will be closing on November 24, is likely to be announced by Friday. The anchor book will be opened for a day on November 21.

The IPO comprises a fresh issue component of Rs 302 crore, and an offer-for-sale (OFS) of 1.17 crore equity shares by selling shareholders including promoters.

Promoters Ramesh Babulal Parekh, Kailash Parekh, and Gulab Parekh will be selling 22.5 lakh shares each in the OFS. Further, Green Desert Real Estate Brokers, Denver Bldg Mat & Décor TR LLC, and Fleet Line Shipping Services LLC will be exiting the company by selling the entire shareholding of 30 lakh shares, 10 lakh shares and 10 lakh shares, respectively, in the OFS.

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The Maharashtra-based company that caters to the consumer and healthcare end industries will repay the debt of Rs 22.71 crore of its subsidiary Texol. Further, Rs 27.73 crore will be spent for the purchase of equipment and civil work required for expansion in the capacity of automotive oil at the Silvassa plant, and Rs 185 crore will be utilised for working capital requirements. The remaining amount will be used for general corporate purposes.

Gandhar Oil makes several products primarily across the personal care, healthcare and performance oils (PHPO), lubricants and process and insulating oils (PIO) divisions under the Divyol brand. The company enjoys long-term relationships with several domestic and global customers including Procter & Gamble, Unilever, Marico, Dabur, Encube, Patanjali Ayurved, Bajaj Consumer Care, Emami and Amrutanjan Healthcare.

Also read: Tata Technologies sets IPO price band at Rs 475-500 per share

Promoters - Parekh family own an 87.5 percent stake in India's largest manufacturer of white oils, which recorded revenue growth at a CAGR of 40.6 percent during FY21-FY23, and the rest of the shares are held by public shareholders including IDFC Asset Management Company.

The PHPO is the largest business division contributing 55 to the topline in FY23, followed by lubricants with 25 percent share in the revenue. And the rest of the contribution to revenue comes from PIO and channel partners.

ICICI Securities and Nuvama Wealth Management are the merchant bankers to the issue.