Bread and biscuits maker Mrs Bectors Food Specialities will launch its initial public offer (IPO) on 15 December 2020. The company is looking to raise Rs 540.54 crore through this issue. The issue will remain open for three days till 17 December 2020. The IPO would comprise of a fresh issue of equity shares worth Rs 40.54 crore and an offer for sale (OFS) by existing shareholders worth Rs 500 crore. The company has set a price band of Rs 286-288 apiece. One can apply for Mrs Bectors Food Specialities IPO with a lot size of 50 shares for Rs 14,400.
Use of IPO proceeds
The company will not receive any proceeds from the Offer for Sale. The proceeds of the fresh issue will be utilised for financing the project cost towards the expansion of the Rajpura Manufacturing Facility by establishing a new production line for biscuits.
Mrs Bectors Food Specialities is the largest supplier of buns to quick service restaurant (QSR) chains such as McDonald’s, KFC, Burger King and Carl’s Jr. It also makes and sells breads, buns and other bakery products under the brand name ‘English Oven’; and biscuits and cookies under the brand name ‘Cremica’.
Grey market premium
Today in the grey market, Mrs Bectors Food Specialities shares were seen trading at Rs 418, a premium of 45 per cent over the issue price of Rs 288 apiece, according to an independent dealer in unlisted shares. SBI Capital Markets, ICICI Securities and IIFL Securities are the book running lead managers, while Link Intime India is the registrar to the issue. Anoop Bector is the promoter of Mrs Bectors Food Specialities.
Up to 50 per cent of the issue will be reserved for Qualified Institutional Buyers (QIB) while 35 per cent will be reserved for retail investors and not less than 15 per cent for the non-Institutional Investors (NIIs). The employee reservation portion would be up to Rs 50 lakh. Mrs Bectors Food Specialities is offering a discount of Rs 15 per equity share to employees.
“The company has shown lackluster growth in the past couple of years while the company has shown good growth in the first quarter of 2020 like other FMCG peers mostly due to change in eating habits of people amid lockdown,” Abhay Doshi, a Gujarat based independent dealer in unlisted shares, told Financial Express Online. Highly competitive industry and weak growth may stand against the company in the longer run. Current market conditions may favour the company on listing, he added.