TheNFAPost Podcast

Mumbai, NFAPost: Pune based Indigo Paints Limited, one of the fastest growing amongst the top five paint companies in India,received bids of 1,04,67,410 shares against the offered 55,18,402 shares, as per the 5:00 pm data available on the exchanges. 

The portion reserved for retail investors was subscribed 3.29 times. Qualified Institutional Buyer and Non-Institutional Investor category was subscribed 0.10 and 1.10 times respectively. The portion reserved for eligible employees was subscribed 0.73 times.

The bidding for the Rs. 1170 crore IPO closes on Friday, January 22, 2021.  The IPO comprises fresh issue of Rs 300 crore, and an offer for sale of 58,40,000 equity shares by promoter (Hemant Jalan) and investors (Investors Sequoia Capital India Investments IV and SCI Investments V) amounting to Rs. 870.16 crores. The minimum bid lot is 10 equity shares thereafter in multiples.  The price band has been fixed at Rs. 1,488 – Rs. 1,490 per Equity Share.

Recently the Company raised 348 crore from 25 anchor investors which included globally acclaimed institutions such as Capital Group, Government of Singapore Investment Corporation, Fidelity, Goldman Sachs, Government Pension Fund Global, Nomura, HSBC, PACIFIC HORIZON INVESTMENT TRUST, Stewart, Carmignac, Theleme, Matthews, Jupiter, Virtus Kar Emerging Markets Small-Cap Fund. Some of the key DII’s included SBI MF, HDFC MF, ICICI Prudential MF, Nippon MF, Axis MF, Birla MF, Motilal MF, HDFC Life and ICICI Prudential Life.

Key brokerage houses like HDFC Securities, Anand Rathi, Kotak Securities, Sushil Finance, Nirmal Bang, Ventura, Religare Broking, Axis Capital , IIFL Securities amongst others have recommended investing in the public issue given the company’s fast growth trajectory and possibility of achieving a debt free status post the IPO.

Some of key elements highlighted in the reports includes – increasing the portfolio of differentiated products, strong marketing initiatives to increase brand recall, increasing presence in select new territories and expansion in new geographical territories; and increasing manufacturing capacities in their facility units which overall indicated Indigo Paints as a strong investment option.

Kotak Mahindra Capital Company Limited, Edelweiss Financial Services Limited and ICICI Securities Limited are the BRLMs to the Offer.

image.png

Indigo Paints is amongst the fastest growing among the top five paint companies in India. It is the fifth largest company in the Indian decorative paint industry in terms of revenue from operations for Fiscal 2020 (Source: F&S Report). Headquartered in Pune, Indigo Paints offers a complete range of decorative paints including emulsions, enamels, wood coatings, distempers, primers, putties and cement paints.

As on September 30, 2020, the Company owns and operates 3 manufacturing facilities located in Jodhpur (Rajasthan), Kochi (Kerala), Pudukkottai (Tamil Nadu). These facilities had an aggregate installed production capacity of 101,903 kilo litres per annum (“KLPA”) for liquid paints and 93,118 metric tonnes per annum (“MTPA”) for putties and powder paints as of September 30, 2020. The Company has an extensive distribution network across 27 states and 7 union territories as of September 30, 2020.

LEAVE A REPLY

Please enter your comment!
Please enter your name here