JSW Cement may get Sebi nod soon for Rs 4,000-crore IPO

JSW Cement

JSW Cement, part of the Sajjan Jindal-led infrastructure-to-metals conglomerate, JSW group, is likely to receive the nod soon from Sebi for its Rs 4,000-crore initial public offer, multiple industry sources in the know told Moneycontrol on the condition of anonymity. The firm had filed its draft red herring prospectus on August 17, 2024.

On a periodic basis, Sebi discloses the approval status of offer documents for IPO on its website.

Moneycontrol was the first to report the listing plans of JSW Cement on January 10, 2024 and also reported the filing plans on August 16.

Later on September 3, Moneycontrol reported that Sebi had put the approval process on hold due to a pending proceeding involving the promoter family.

"Depending on the final approval by Sebi, investor roadshows and other factors, a call will be taken later on the IPO launch timing," one of the persons quoted above told Moneycontrol.

A second person confirmed the above.

Moneycontrol has sent an email query and is awaiting a response from the JSW Group and Sebi. This article will be updated as soon as we hear from them.

The deal is a combination of fresh issuance of equity shares worth Rs 2,000 crore, and an offer-for-sale (OFS) of Rs 2,000 crore by the existing shareholders. Investors like Apollo Global Management, Synergy Metals Investment Holding and SBI will participate in the offer-for-sale.

The initial share sale would be the cement sector's first major offering since Nuvoco Vistas' Rs 5,000 crore IPO in August 2021. Incidentally, the listing of JSW Infrastructure in October 2023 marked the group's first public offering in 13 years.

JSW Cement's move to make a debut on Dalal Street comes at a time when the cement sector is witnessing an intense M&A tussle between market leader Ultratech Cement of the Birla group and the ACC-Ambuja combine of the Adani group. Shiva Cement was acquired by JSW Cement in 2017 and supplies clinker - a key component in cement production - to the parent entity

JM Financial, Kotak Mahindra Capital, Jefferies, Axis Capital, DAM Capital, Citi, Goldman Sachs and SBI Capital are the investment banks managing the share sale. Khaitan and Co is the legal counsel to the firm.

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JSW Cement's expansion plans

JSW Cement had an installed grinding capacity of 20.60 MMTPA (million metric tonnes per annum) and an installed clinker capacity of 6.44 MMTPA as of March 2024 and may consider raising Rs 400 crore through a preferential offer or any other method, prior to filing of the Red Herring Prospectus with the ROC. If such a pre-IPO placement is completed, the company will reduce the fresh issue size accordingly.

The so -called 'green cement' manufacturer will spend Rs 800 crore out of the fresh issue proceeds for establishing a new integrated cement unit at Nagaur, Rajasthan, and an additional Rs 720 crore will be utilised for repaying debt. The remainder of the fresh issue proceeds will be used for general corporate purposes.

JSW Cement, which started operations in 2009 in the southern region of India and operates seven plants in India, is expected to increase its installed grinding capacity from 20.60 MMTPA to 40.85 MMTPA and installed clinker capacity from 6.44 MMTPA to 13.04 MMTPA. Further, it intends to increase the total capacity to 60.00 MMTPA.