Dodla Dairy IPO to open tomorrow, to repay debt from funds raised
Dodla Dairy IPO to raise ₹520 crore, comprising of a fresh issue of equity shares and an offer for sale by existing shareholders, will open for three days on Wednesday, June 16, and close on Friday, June 18. Dodla Dairy IPO will open for subscription at a price band of ₹421- 428 per share and the shares are likely to be listed on BSE and the National Stock Exchange of India (NSE) on June 28.
The company filed draft papers with the Securities and Exchange Board of India (SEBI) earlier this year and received the capital markets regulator’s approval to float its public offering in the last week of April.
The issue of Dodla Dairy consists of a fresh issue of equity shares worth Rs 50 crore and an offer for sale (OFS) of up to 1.09 crore equity shares of face value ₹10 each.
The selling shareholders include promoters Dodla Sunil Reddy and Dodla Deepa Reddy, along with TPG Dodla Dairy Holdings. Post issue, promoter shareholding in the company will drop to 64.17% from the current 68.52%. Public shareholding in Dodla Dairy will improve to 35.83% from 31.48% pre-issue. The number of shares of Dodla Dairy will increase to 5.95 crore.
According to regulatory filings, 50 per cent of the issue or approximately 60.76 lakh equity shares on offer have been reserved for qualified institutional buyers (QIB). Non-Institutional Investors (NII) can bid for 18.23 lakh equity shares or 15 per cent of the total issue. Retail investors are eligible for 35 per cent of the total issue or 42.53 lakh equity shares.
Dodla Dairy plans to use the funds raise via the fresh issue to re-pay or pre-pay debt availed by the company. The company has also said that part of the funds will also be utilised towards incremental capital expenditure requirements.
ICICI Securities and Axis Capital are the book-running lead managers for the issue.
Dodla Dairy, an integrated company based in Hyderabad, was incorporated in 1995 and it operated in south India and Maharashtra. Dodla Dairy’s primary source of revenue is from the sale of milk and dairy-based Value Added Products in the branded consumer market. The company sell fresh milk, ghee, butter, curd, paneer, among other dairy products, which are targeted at consumption at home.
According to Axis Capital, it also sells ultra-high-temperature processing or UHT milk, flavoured milk, ice cream and buttermilk under their brand. The company has continued to remain profitable for the last three fiscal years.
Dodla Dairy IPO will be the fourth main-board company to launch its initial public offering (IPO) in the next week, after Shyam Metalics, Sona Comstar and KIMS Hospitals.
(With agency inp)