Indigo Paints raises Rs 348 cr from anchor investors ahead of IPO

Sequoia Capital-backed Indigo Paints on Tuesday said it has mopped up Rs 348 crore from anchor investors ahead of its initial share-sale, which will open for public subscription on Wednesday.

A total of 23,35,020 shares have been allotted to 25 anchor investors at Rs 1,490 apiece, which is the upper end of the price band, the company said in a statement.

At this price, the company mobilised Rs 348 crore, it added.

Among the major anchor investors are Government of Singapore Investment Corporation, Fidelity, Goldman Sachs, Nomura, Government Pension Fund Global, HSBC, SBI Mutual Fund(MF), HDFC MF, ICICI Prudential MF, Axis MF, HDFC Life and ICICI Prudential Life.

The IPO comprises fresh issuance of stocks aggregating to Rs 300 crore and an offer-for-sale of up to 58,40,000 equity shares by private equity firm Sequoia Capital, through its two funds SCI Investments IV and SCI Investments V, and promoter Hemant Jalan.

The price band has been fixed at Rs 1,488-1,490 a share for the initial share-sale, which will open for public subscription on January 20 and conclude on January 22.

At the upper end of the price band, the initial public offer (IPO) is expected to fetch Rs 1,170.16 crore, which comprises Rs 300 crore through fresh issuance of shares and Rs 870.16 crore through OFS.

Half of the issue is reserved for qualified institutional buyers, 35 per cent for retail investors, 15 per cent for non-institutional bidders and there is a reservation of up to 70,000 equity shares for employees, who will get a discount of Rs 148 per equity share to the offer price.

Proceeds from the fresh issuance of shares would be used for expansion of the existing manufacturing facility at Pudukkottai in Tamil Nadu, purchasing of tinting machines and gyro shakers and repayment/prepayment of borrowings.

Kotak Mahindra Capital Company, Edelweiss Financial Services and ICICI Securities are the book running lead managers to the issue.

The Pune-based company manufactures a range of decorative paints and has an extensive distribution network across the country.

As of September 30, 2020, the company has three manufacturing facilities located in Rajasthan, Kerala and Tamil Nadu.