Shyam Metalics and Energy, a leading integrated metal-producing company, has refiled its draft red herring prospectus (DRHP) with the Securities and Exchange Board of Indai (Sebi) to raise Rs 1,107 crore via an initial public offering (IPO).
The company tried to tap the capital markets in 2018 and even received the market regulator’s nod in early 2019 and was to launch the IPO the next year but the coronavirus pandemic and weak market sentiment forced it to defer the plan.
The IPO comprises a fresh issue of up to Rs 657 crore and an offer for sale of Rs 450 crore by promoter and promoter group. The offer includes a reservation of up to 3 lakh equity shares for eligible employees.
The Kolkata-based company, which is among the largest producers of ferro alloys in India, intends to utilise the fresh issue proceeds for repayment of debt.
The metal-producing company has a consistent track record of delivering operating profitability, and since the commencement of operations in FY05, it has delivered a positive EBITDA in every fiscal.
It operates three plants in Sambalpur in Odisha and Jamuria and Mangalpur in West Bengal. As of December 2020, the aggregate installed metal capacity of the plants was 5.71 million tonne per annum (MTPA), comprising intermediate and final products. Its manufacturing plants also include captive power plants with an aggregate installed capacity of 227 MW.
Shyam Metalics is also in the process of increasing the capacities of existing plants and captive power plants, which is expected to increase aggregate installed metal capacity from 5.71 MTPA to 11.60 MTPA and captive power plants aggregate installed capacity from 227 MW to 357 MW. These proposed expansions are expected to become operational between FY22 and FY25.
It is also in the process of commissioning an aluminium foil rolling mill at Pakuria in West Bengal with a proposed installed capacity of 0.04 MTPA, which is expected to become operational in FY22.
ICICI Securities, JM Financial, Axis Capital, IIFL Securities and SBI Capital Markets are the book running lead managers to the issue.
News Source: Moneycontrol