Nirma group cement company Nuvoco Vistas Corporation Ltd IPO will open for subscription on Monday, 9 August, at a price band of Rs 560-570 per share of face value of Rs 10 each. The issue will close on Wednesday, 11 August. Nine years ago Nirma shares were delisted from exchanges. The Rs 5,000 crore public issue comprises a fresh issue of shares worth Rs 1,500 crore and an offer for sale (OFS) of Rs 3,500 crore by its promoter entity Niyogi Enterprise Pvt. Ltd. Niyogi Enterprises holds an 86.56 per cent stake in the company.
Investors can make bids for a minimum of 26 equity shares and in multiples thereafter, implying a minimum investment of Rs 14,820 per lot. Half of the net offer has been reserved for qualified institutional buyers (QIBs), 35 per cent for retail investors and the remaining 15 per cent for non-institutional investors. Upon successful completion of its IPO, it will join the industry-listed peers such as Ultratech Cement, Shree Cement, Ambuja Cements and ACC. ICICI Securities Ltd, Axis Capital, HSBC Securities and Capital Markets India, JP Morgan India and SBI Capital Markets are the lead managers to the issue. Link Intime India Private Ltd is the registrar to the issue.
The average industry P/E ratio stands at 35.90x, while the weighted average return on net worth for the last three fiscals is 1.31 per cent. The company has planned to utilise the net proceeds from the issue for the repayment/prepayment/redemption, in full or part, of certain borrowings availed of by the company which is about Rs 1,350 crore and for general corporate purposes. Nuvoco Vistas is the fifth-largest player in India and the largest cement company in East India, in terms of capacity, with a consolidated capacity of 22.32 MMTPA. It has 11 cement plants, comprising five integrated units, five grinding units and one blending unit.
Nuvoco Vistas’ competitors from domestic cement companies which operate in the Indian market, include UltraTech Cement Limited, Shree Cement Limited, Birla Corporation Limited, Dalmia Bharat Cement Limited, Ambuja Cement Limited and other regional players like Wonder.