Gandhar Oil Refinery India, the manufacturer of white oils with focus on the consumer and healthcare end-industries, has fixed a price band at Rs 160-169 per share for its maiden public issue on November 17.
The public offer will be opening on November 22 and the closing date will be November 24, while investors can participate in the anchor book on November 21.
The Mumbai-based company that caters to consumer, healthcare, automotive, industrial, power and tyre sectors, is planning to mop up Rs 500.69 crore via the IPO, which consists of a fresh issue of Rs 302 crore worth shares and an offer-for-sale (OFS) of 1.17 crore equity shares worth Rs 198.69 crore at the upper price band by several selling shareholders including promoters.
Ramesh Babulal Parekh, Kailash Parekh, and Gulab Parekh, who are the promoters, will be selling 22.5 lakh shares each in the OFS, while Green Desert Real Estate Brokers, Denver Bldg Mat & Décor TR LLC, and Fleet Line Shipping Services LLC will exit the company by selling their entire shareholding in the company.
Also read: Tata Technologies IPO: 10 things to know before subscribing to Rs 3,042 crore issue
The major part of the net fresh issue proceeds will be used for working capital requirements of the company, amounting to Rs 185 crore. Further, the debt of Rs 22.71 crore availed by Texol will be repaid via fresh issue proceeds, and Rs 27.73 crore will be spent for purchase of equipment and civil work required for expansion in capacity of automotive oil at Silvassa plant.
And the remaining funds will be kept for general corporate purposes.
The India's largest white oils manufacturer has reserved half of the offer size for qualified institutional buyers. Further, 15 percent issue size has been set aside for high networth individuals (non-institutional investors), and the remaining 35 percent for retail investors.
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The lot size will be of 88 equity shares and in multiples of 88 shares thereafter. This means the retail investors can invest a minimum of Rs 14,872 per lot (88 shares) and their maximum investment will be Rs 1,93,336 (for 1,144 shares).
Gandhar has a portfolio of 440 products across the personal care, healthcare and performance oils (PHPO), lubricants and process and insulating oils (PIO) divisions under the Divyol brand.
Also read: IREDA sets Rs 30-32 price band for its IPO
Gandhar bets on the growth in FMCG products
The Mumbai-based company is betting on the growth in the fast-moving consumer goods (FMCG) sector, which is projected to support revenue growth of 10-12 percent in this fiscal year, according to a recent Crisil report.
"There is aspiring middle class in India with their disposable income also increasing. We foresee that the growth in consumption of products in rural markets of India along with awareness of products across the value chain will help our company take care of the growth," Joint Managing Director Aslesh Parekh told Moneycontrol in an interview.
The leading producer of white oil, with 27 percent market share in the country, also flagged further expansion in international and domestic markets to broaden the customer base. The comments come amid a revival in demand for discretionary products in urban markets.
"We are well poised and strategically placed to capture that growth. We will also would like to grow exponentially in terms of our geographies," Parekh said adding that the company is in discussions with various multinational customers. He did not name the customers.
ICICI Securities, and Nuvama Wealth Management are the merchant bankers to the issue.
Apart from Gandhar Oil Refinery, Tata Technologies, Fedbank Financial Services, Flair Writing Industries, and Indian Renewable Energy Development Agency will be launching their IPOs next week.
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