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Textile company Scotts Garments announced on Monday that it would be offering its shares in a price-band of Rs 130 to Rs132 as part of its initial public offer (IPO).
The company will issue 1.05 crore shares through its IPO, which after employee allocations of 4.5 lakh shares, translates into a net issue of 25.8% of the company to the public. The issue will open on 25th April and close on 29th April.
The money raised will be used to finance a portion of the cost of setting up a unit for trouser manufacturing at Doddaballapur, Karnataka and knitting and fabric processing unit at Kagal-Kolhapur Maharashtra.
Some of the capital will also be used to meet margin money for working capital of the new units, for general corporate purposes and to meet Issue expenses, according to the company’s offer documents.
Rating agency CARE has given it an IPO Grade of 3, indicating average fundamentals, according to the company's offer documents.
Canbank Venture Capital Fund picked up 17.39 lakh shares at a price of Rs.115 per share in the company in a pre-ipo placement.
The company had revenues of Rs.500.25 crore for the financial year ending in March 2012(FY12), and a profit after tax of Rs.84.03 crore.
It had a revenue of Rs.329.39 crore and profit after tax of Rs.20.41 crore till October, 2012, according to offer documents.
Over 90% of its sales come from exports, with the majority from European nations, but the company states that sales have remained unaffected by the financial crises in the region.
“Though we have high exposure in this region, we weren’t vastly affected from the global meltdown. However, to insulate ourselves from any future economic slowdown, we plan to increase our presence in domestic market and also tap the other regions across the globe,” said its prospectus.
Link Intime India is the Registrar to the issue.
Keynote Corporate Services and Canara Bank Merchant Banking Division are the merchant bankers handling the issue.
Keynote has not managed any public issue after January 10, 2012, according to the track record available on its website. Canara Bank, Merchant Banking Divisions too has not managed any Public Issue listed after January 10, 2012.
