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Kotak PE-backed Advanced Enzyme eyes $300 mn valuation in IPO

Advanced Enzyme Technologies Ltd is seeking a valuation of as much as Rs 2,000 crore ($300 million) through an initial public offering that opens next week.

The enzymes manufacturer has fixed a price band of Rs 880-896 a share for the IPO, it said in a statement. The issue opens on July 20 and closes on July 22.

The IPO comprises a fresh issue to raise Rs 50 crore and an offer for sale of about 4 million shares by its promoters, Kotak Private Equity and other shareholders. The total size of the issue would be about Rs 412 crore at the upper end of the price band.

Kotak Private Equity had invested Rs 30 crore in the firm in mid-2012. It is now offloading around half of its stake.

Advanced Enzyme researches, develops, makes and sells about 400 proprietary products developed from 60 indigenous enzymes. It says it ranks among the top 15 global companies in terms of enzyme sales, and has the second-highest market share domestically, next only to the world leader Novozymes.

It operates in two primary business verticals namely healthcare and nutrition (human and animal) and bio-processing (food and non-food); the former generates bulk of its revenue. It offers these products to about 700 customers across 50 countries.

Promoted by Chandrakant Laxminarayan Rathi and Vasant Laxminarayan Rathi, it employs scientists, microbiologists, engineers, food technologists and biotechnologists. It has four R&D facilities and six manufacturing facilities.

The company had filed its draft red herring prospectus for the IPO with capital markets regulator Securities and Exchange Board of India in January. It received SEBI approval in early May.

The firm will use bulk of the amount to be raised through the fresh issue to repay debt availed by its American arm from its promoters. Advanced Enzymes USA had borrowed $20 million from a group firm and promoter Vasant Laxminarayan Rathi against promissory notes dated 13 December 2012.

ICICI Securities and Axis Capital are managing the issue.

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