India's top private sector seeds company Nuziveedu Seeds Ltd has filed its draft red herring prospectus (DRHP) with securities market regulator SEBI to float its initial public offer (IPO).
The proposed public issue comprises fresh issue worth Rs 125 crore ($20 million) besides an offer for sale from its promoters and existing private equity investor Blackstone.
For Blackstone, this is the second portfolio firm from which it is looking at a part-exit via a public float. Last month Mumbai-based firm S.H. Kelkar & Co. Pvt Ltd, a manufacturer of fragrances and flavours, filed its documents for an IPO. Blackstone is looking at a part-exit there too.
Moreover, Blackstone has sought IPO of another portfolio firm Gateway Rail Freight Ltd (GRFL), which could open the window for a part or full exit from its over five-year-old investment in the subsidiary of Gateway Distriparks Ltd (GDL).
Nuziveedu Seeds is among a dozen of companies that filed documents for maiden public issues since January this year. However, it is the first agricultural firm to apply for an IPO this year.
Here's a snapshot of the IPO
* Fresh issue of shares to raise up to Rs 125 crore besides an offer for sale of up to 9.9 million equity shares by promoter Mandava Prabhakara Rao and up to 1.9 million shares by Blackstone. The total issue would comprise 10 per cent of the fully diluted post issue paid-up equity share capital of the company.
* Bankers: Axis Capital, IDFC Securities, JM Financial and JP Morgan India.
Use of proceeds
* It would use the proceeds for repayment of certain borrowings and for general corporate purposes.
* Founded in 1973, Hyderabad-based Nuziveedu Seeds develops, produces, processes and sells seeds for a range of field crops and vegetables. It has operations in 19 states across India.
* As of December 2014, the company has produced seeds for 27 different field crops and vegetables.
* The sale of cotton seeds contributes the majority of the company's revenue from operations, accounting for 66.58 per cent and 69.73 per cent of its revenue from operations in fiscal 2014 and the nine months ended December 31, 2014, respectively.
* It has also acquired other firms. From FY11 to FY13 it acquired Yaaganti Seeds, Pravardhan Seeds, Prabhat Agri Biotech, Fortune Hybrid Seeds, Asian Agri Genetics and Jubilee Real Projects which helped it expand its germplasm bank, product offerings, processing facilities, research infrastructure, customer base and sales and distribution network. In particular, the acquisition of Yaaganti Seeds gave it established hybrid products for maize.
For the nine months ended December 31, 2014, it had total revenues of Rs 1,254.9 crore with net profit of Rs 200.4 crore. For the financial year ended March 31, 2014, the company posted total revenues of Rs 1,196.6 crore and a PAT of Rs 150.8 crore.
Blackstone had invested Rs 250 crore in the firm in February 2011 and currently owns 10.5 per cent stake. It is looking to sell up to a fifth of its total holding in the IPO as part of the offer-for-sale.
(Edited by Joby Puthuparampil Johnson)