1. Godrej Agrovet IPO fully subscribed as day 2 bidding still on; good response from retail investors

Godrej Agrovet IPO fully subscribed as day 2 bidding still on; good response from retail investors

Godrej Agrovet IPO which opened on Wednesday for subscription got fully subscribed as the second-day bidding continues.

By: | Published: October 5, 2017 1:31 PM
Godrej Agrovet is the first public offer of Godrej group in 8 years. (Image: Reuters)

Godrej Agrovet IPO which opened on Wednesday for subscription got fully subscribed as the second-day bidding continues. Godrej Agrovet’s public offer is expected to raise up to Rs 1,157.31 crore at the upper end of the price band was subscribed 1.0004 times as at 1.2o pm, today. The portion set aside for QIBs (qualified institutional buyers) was subscribed 0.3 times, the shares allocated to non-institutional investors got subscribed 0.33 times while the quantum reserved for retail investors was subscribed 1.75 times. The bids received for the reserved for employee category stood at 0.15 times.

The company has set a price range of Rs 450-460 per equity share for its public offer. This is the first public offer of Godrej group in 8 years. The IPO will remain open for three days starting from 4 October to 6 October. Godrej Agrovet is an agriculture-business based company incorporated in 1991. The shares of Godrej Agrovet are proposed to be listed on BSE and NSE. We take a look at four key things to know about the share sale.

Anchor investors

Godrej Agrovet has raised about Rs 341 crore from anchor investors ahead of its initial public offer. Over 74.17 lakh shares would be allotted to 25 anchor investors at the upper end of the price band i.e., Rs 460 per equity share, the company said in an exchange filing. At Rs 460, the total amount comes out to be Rs 341.18 crore. The major anchor investors include Reliance Capital Trustee Company, SBI Life Insurance Company, Nomura, Goldman Sachs, Government of Singapore and Birla Sunlife Trustee Company.

IPO proceeds

Each of the selling shareholders will be entitled to the respective portion of the proceeds of the OFS (offer for sale). The company will not receive any proceeds from the OFS. The net proceeds from the fresh issue will be utilised towards repayment of loans and for other general corporate purposes. It includes repayment or prepayment of working capital facilities availed by the company, repayment of commercial papers issued by the company and general corporate purposes which is subject to the applicable laws.

Business profile

Godrej Industries owns 60.81% in Agrovet, which is in businesses such as agri-inputs, animal feeds, palm oil manufacturing, dairy, poultry and processed foods. In the crop protection business, the company manufactures products that cater to the entire crop lifecycle including plant growth regulators, organic manures, generic agrochemicals and specialized herbicides.

Financials

Godrej Agrovet reported a rise of 4.81% in the net profit to Rs 273.53 crore for the financial year ended 31 March 2017 as compared to Rs 260.98 in the last year. While company’s total sales grew by 30.53% to Rs 4,983.3 from last year’s sales of Rs 3817.67 crore.

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