Madhya Pradesh-based mid-size polymer products company Flexituff International listed on the bourses at its issue price of Rs 155 a share and was hovering around the public issue price in mid-day trades, before closing at Rs 166.4 or 7 per cent premium to the issue price.
The Clearwater Capital-backed company had fixed its issue price at the upper end of the price band of Rs 145-Rs 155 a share, raising Rs 105 crore through its maiden public offering that just managed to scrape through.
Clearwater Capital Partners, which part-exited in the issue, has seen its holding shrink from 25 per cent to 10.3 per cent. Clearwater sold over 2.2 million shares, which accounted for a third of the issue, to rake in Rs 34.87 crore. Its remaining stake in the company is worth Rs 36-38 crore.
Clearwater, which seeks deals in special situation and distressed or undervalued assets, had invested Rs 46 crore in the company in January 2008 through convertible debentures. Its cost of purchase is pegged at Rs 102.5 per share which means it is sitting on around 60 per cent unrealised gains on its remaining investment, as per VCCircle estimates.
Flexituff intends to use bulk of the funds raised in the IPO to meet working capital requirements (Rs 25 crore), besides expanding the manufacturing facility at Pithampur (Rs 18.9 crore) and enhancing other projects.
The company reported 77 per cent increase in consolidated sales to Rs 618 crore with profit before tax increasing nearly fourfold – from Rs 8.9 crore in FY10 to Rs 34.2 crore in FY11.