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Godrej Group’s agro business player, Godrej Agrovet, plans to raise about ₹1,160 crore in the price band of ₹450-460 via a mix of fresh issue worth ₹292 crore and the rest by way of an offer-for-sale.
Main shareholder and listed company Godrej Industries, which holds 63.67 per cent in Godrej Agrovet, is selling shares worth up to ₹300 crore. After jumping 4 per cent intraday on Tuesday, shares of Godrej Industries settled with 1.6 per cent gain on the NSE.
Singapore-based Temasek Holdings’ subsidiary,V Sciences Pte Ltd, that holds 20 per cent stake in the company, will sell up to 12.3 million shares, which at the upper end of the price range would be worth ₹566 crore. The proceeds from the IPO will be used to repay its working capital facilities of ₹100 crore and also to repay commercial papers worth ₹150 crore. The rest will be used for general corporate purposes.
Kotak Investment Banking, Axis Capital and Credit Suisse are the banks managing the IPO. The IPO will open on October 4 and close on October 6. This is second IPO by a Godrej group company within a decade after Godrej Properties’ IPO in December 2009. The company operates across five business verticals, namely, animal feed, crop protection, oil palm, dairy, and poultry and processed foods. In FY17, it reported a revenue of ₹4,983 crore and profit of ₹273.9 crore.
Though valuation of 29 times FY18 estimated earnings is seen as a tad aggressive, analysts at the company’s analyst conference were positive on the business prospects.
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