Varun Beverages has priced its initial public offering (IPO), aimed at raising R1,113 crore, in a price band of R440-R445. The stake of promoter will be reduced to 73.76% from the current 86.35%.
The offer consists of a fresh issue of 1.5 crore shares and an offer for sale of 50 lakh shares each by promoters Ravikant Jaipuria and Ravikant Jaipuria & sons. The proceeds of the issue will be utilised for pre-payment or scheduled repayment of debt and general corporate purposes.
The company reported revenues of R3,408 crore for the year ended 31 December 2015, up by 35.4% from the previous year’s R2517 crore. For the year ending December 2015 the company made a net profit of R87 crore against the previous year’s loss of R20 crore.The company is the franchisee of Pepsico in 17 Indian states.
The company produces and sells Pepsico’s brands including Pepsi,Seven-up, Tropicana, Nimbooz among others. The company is also the franchise for Pepsico’s products in Nepal, Srilanka, Morocco, Mozambique and Zambia.
According to guidelines put out by Securities and Exchange Board of India (Sebi), 50% of the shares are reserved for qualified institutional buyers (QIB) category, 15% for high net-worth individuals (HNIs) and 35% for retail investors.
Up to 60% of the QIB portion has been reserved for anchor investors and one-third of the anchor investor portion has been reserved for domestic mutual funds. Five per cent of the QIB category, excluding the anchor investor portion, has been reserved for mutual funds on a discretionary basis. The issue has reserved 5 lakh equity shares for the employees.