Gujarat-based stainless steel manufacturing company Rajputana Stainless has decided to withdraw its anchor book later in the day after managing to close with one institutional investor during the day on March 6. This is a day before the IPO opening for public subscription.
The company is raising Rs 254.98 crore via initial public offering (IPO) at the upper end of price band of Rs 116-122 per share.
The offer, which is a combination of fresh issue of 1.46 crore shares worth Rs 178.73 crore and offer-for-sale of 62.5 lakh shares worth Rs 76.25 crore, will open for public on March 9 and close on March 11.
Rajputana Stainless launched its anchor book on March 6 and attracted only one anchor investor - Shine Star Build Cap Private Limited which acquired 8.19 lakh shares in the company for Rs 10 crore against the proposed anchor book of Rs 76.49 crore. This is not fit into the SEBI rule.
"The minimum number of anchor investors required for allocation under the anchor investor portion, as specified under the SEBI Regulations, did not participate in the offer," the company in its filing to exchanges late night on last Friday said.
Accordingly, BRLM and the company have decided not to proceed with allocation of equity shares under the anchor investor portion of the offer.
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"The earlier letter submitted by us with respect to the anchor investor allocation stands withdrawn, and accordingly, the category-wise allocation of the offer shall remain as applicable at the pre-anchor stage, in accordance with the applicable provisions of the SEBI Regulations, 2018," Rajputana Stainless said.
As per the SEBI regulations, the company carrying the anchor book worth up to Rs 250 crore has to attract minimum two anchor investors and maximum of 15 anchor investors, subject to minimum allotment of Rs 5 crore per anchor investor.
Rajputana Stainless has reserved half of its offer size for qualified institutional buyers (QIB), which is Rs 127.49 crore of Rs 254.98-crore offer, 15 percent for non-institutional investors, and 35 percent for retail investors.
Further, as per the RHP filing, it may allocate up to 60 percent of the QIB portion to anchor investors on a discretionary basis (which comes to Rs 76.49 crore).
Meanwhile, Rajputana Stainless will utilise its proceeds from the fresh issue for expansion of the existing manufacturing facility at Panchmahal, Gujarat through forward integration and diversification of product portfolio at a cost of Rs 18.57 crore.
Further, Rs 98 crore will be used for repaying partial debt, and the remainder funds for general corporate purposes.
Nirbhay Capital Services is acting as the sole merchant banker for the Rajputana Stainless IPO.
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