Varroc Engg IPO opens; Tata Capital to sell stake

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Mumbai | Updated: Jun 27, 2018 2:59 AM

The IPO is an offer for sale of 2.02 crore shares, which at the upper price of the band, will translate into an offer size of Rs 1,955 crore.

The initial public offer (IPO) of auto components manufacturer Varroc Engineering was subscribed 0.33 times on Tuesday, the first day of the offer, with investors bidding for 46.18 lakh shares out of the 1.41 crore shares on offer.

Qualified institutional buyers bid for 1.04 times the shares offered to them, high net worth individuals for 0.01 times, retail investors 0.05 times and employees bid for 0.1 times of their allocation.

Varroc Engineering has set a price band of Rs 965 to Rs 967 for its public subscription. The IPO is an offer for sale of 2.02 crore shares, which at the upper price of the band, will translate into an offer size of Rs 1,955 crore.

The company raised Rs 584 crore from anchor investors ahead of its IPO.

The offer will close on June 28. Investors can bid for a minimum of 15 equity shares and multiples of 15 equity shares after that.

The 100% offer-for-sale constitutes 15% of the post-offer paid up equity share capital of the company.

The company will not receive any proceeds from the offer, and all the proceeds will go to the selling shareholders. The company’s promoter Tarang Jain, and shareholders —Omega TC Holdings and Tata Capital — are selling stakes. The company has reserved 1 lakh shares for eligible employees who will get a discount of Rs 48 per share on the offer price.

The company designs, manufactures and supplies exterior lighting systems, plastic and polymer components, electricals-electronics components, and precision metallic components for passenger cars, commercial vehicles, two-wheelers, three-wheelers and off-highway vehicles.

The company has 36 manufacturing facilities spread across seven countries, with six facilities for its global lighting business, 25 for its India business and five for its other business activities.
The company’s revenue for FY16, FY17 and FY18 was Rs 8,218. 9 crore, Rs 9,608.540 crore and Rs 10,378. 45 crore respectively. The company’s profit after tax for FY 16, FY 17 and FY 18 was Rs 369.82 crore, Rs 303.38 crore and Rs 450.77 crore respectively.

In 2017, 36 companies raised Rs 67,147 crore through IPOs. Listing gains and the positive sentiment in the market are among the reasons attributed to the trend.

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