Upcoming IPO: Ethanol producer TruAlt Bioenergy files DRHP; details

Upcoming IPO: TruAlt Bioenergy, a pioneering biofuel producer based in Bengaluru and one of the first companies to produce Compressed Bio-Gas (CBG) under the government's Sustainable Alternative Towards Affordable Transportation (SATAT) initiative, has filed a Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) to raise funds through an Initial Public Offering (IPO).

TruAlt Bioenergy IPO details
 

Through the public issue, TruAlt Bioenergy is offering a fresh issue of company shares worth Rs 75 crore and an offer for sale where promoters are offloading 36 lakh equity shares with a face value of Rs 10 apiece. The offer for sale consists of up to 18 lakh equity shares by Dhraksayani Sangamesh Nirani, and up to 18 lakh equity shares by Sangamesh Rudrappa Nirani.

 

"The company, in consultation with the book-running lead managers, may consider a private placement, rights issue, preferential offer, or any other method of specified securities, for an aggregate amount not exceeding Rs 150 crore as Pre-IPO placement, which shall not exceed 20 per cent of the size of the fresh issue. If such placement is completed, the fresh issue size will be reduced," TruAlt Bioenergy said in a release.

The offer is being made through the book-building process, wherein not less than 75 per cent of the offer shall be available for allocation on a proportionate basis to qualified institutional buyers, not more than 15 per cent of the offer shall be available for allocation to non-institutional bidders, and not more than 10 per cent of the offer shall be available for allocation to retail individual bidders.

DAM Capital Advisors and SBI Capital Markets are the book-running lead managers, and Bigshare Services is the registrar of the offer. The equity shares are proposed to be listed on BSE and NSE.

TruAlt Bioenergy IPO objective
 

As per the release, the company intends to use Rs 172.68 crore from its fresh issuance for funding capital expenditure towards setting up multi-feedstock operations to utilize grains as an additional raw material in the ethanol plant at TBL Unit 4, with a 300 KLPD capacity. Additionally, Rs 425 crore will be used for funding working capital requirements and for general corporate purposes.

TruAlt Bioenergy financials

In Fiscal 2023 and 2024, TruAlt generated revenues of Rs 756.85 crore and Rs 1,214.31 crore from its top 10 customers, accounting for 99.24 per cent and 99.26 per cent of its total revenue, respectively, highlighting its dependence on key clients, the company said in a release. According to the release, TruAlt Bioenergy's consolidated revenue from operations stood at Rs 1,223.40 crore in Fiscal 2024, and Profit After Tax stood at Rs 31.81 crore in Fiscal 2024.

About TruAlt Bioenergy

TruAlt Bioenergy was incorporated in March 2021 and is led by Vijaykumar Murugesh Nirani. As of March 31, 2024, the company claims to be recognized as India’s largest ethanol producer by installed capacity, with a daily production capacity of 1,400 kilolitres (KLPD). A report by CRISIL indicates that TruAlt had a 3.7 per cent market share in ethanol production capacity for Fiscal 2024.