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MOIL IPO on Nov 26

business Updated: Nov 19, 2010 22:47 IST
HT Correspondent

After the success of Coal India’s initial public offer (IPO), Manganese Ore India Ltd (MOIL) is the next state-run company to hit the capital market. The country’s largest manganese ore producer’s IPO will open on November 26.

"The price band and the minimum bid lot will be decided by the company in consultation with shareholders and lead managers. Retail investors will get 5% discount on the issue price," said KJ Singh, chairman and managing director, MOIL.

MOIL share sale is part of the government plan to sell shares in its public sector units such as Coal India, IOC and SAIL.

The offer will close on November 30 for qualified institutional buyers and on December 1, for retail and non-institutional bidders.

IDBI Capital, Edelweiss Capital and JP Morgan are the managers of the issue.

In the offering of 3.4 crore shares, the company plans to dilute around 20% equity, out of which the Centre’s share will be 10% of the total equity while Madhya Pradesh and Maharashtra governments will divest 5% stake each in the undertaking.

The company is investing Rs 768 crore in the current fiscal for capacity expansion as it looks to ramp up manganese output to 1.5 million tonnes per annum by 2015-16 from the present 1.1 million tonnes.

It operates 10 mines, six of which are located in the Nagpur and Bhandara districts of Maharashtra and four in the Balaghat district of Madhya Pradesh.

Steel producers consume a majority of manganese ore and with the steel production capacities set to almost double to 120 million tonnes by 2012, the demand for the ore is bound to increase, Singh said, adding currently India is a net importer of the ore.

The company is also getting into ferroalloys manufacturing and has entered into joint venture agreements with SAIL and RINL in which it will be investing Rs 150 crore. Ore Power