Cement manufacturer Nuvoco Vistas Corp to raise ₹5,000 crore through IPO

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Cement manufacturer Nuvoco Vistas Corp to raise ₹5,000 crore through IPO
BCCL
  • Nuvoco Vistas is looking to raise ₹5,000 crore through a fresh issue of shares worth ₹1,500 crore and an offer for sale by promoters worth ₹3,500 crore.
  • With the net proceeds the company looks to repay borrowings worth ₹1,350 crore.
  • In terms of manufacturing capacity, it is the fifth largest cement company in India and the largest cement company in east India.
Nuvoco Vistas Corporation, a Nirma Group company, has received the regulator’s nod for issuing an initial public offering (IPO). The company is looking to raise ₹5,000 crore through IPO, as per the draft red herring prospectus (DRHP) filed by the company on May 9, 2021.

The IPO comprises a fresh issuance of shares worth ₹1,500 crore and an offer for sale worth ₹ 3,500 crore by the promoter.

In terms of its manufacturing capacity, Nuvoco Vistas -- formerly known as Lafarge India Limited -- is the fifth largest cement company in India and the largest cement company in east India, as per the DRHP filings.

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It also is one of the leading ready mix concrete manufacturers in India and has grown from being a cement focused entity to now a building materials company offering more than 50 products across cement, ready mix concrete and modern building materials sold under well-established brand names such as Concreto, Duraguard, Double Bull, ZeroM and Instamix.

With the net proceeds the company looks to repay some of its borrowings worth ₹1,350 crore.

The company believes that the central government’s focus on roads, railways, urban infrastructure and irrigation will boost infrastructure investments. The share of cement demand of the infrastructure segment is expected to increase from 23% to 25% in FY21 to 25% to 27% in FY26, as per DRHP filing.

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ParticularsFY20FY19FY18
Revenue₹6,793 crore₹7,052 crore₹6,855 crore
Profit/Loss₹249 crore₹ (26 crore)₹87 crore
Net worth₹5,279 crore₹4,988 crore₹ 4,823 crore

The company has five integrated plants, five grinding units and one blending unit across north and east locations. However, the company sells in west and central regions as well due to close proximity of these plants with the regions.

The company has a pan India market share of 4.2%, whereas it is more dominant in the eastern region with a market share of close to 17%, in terms of capacity on a consolidated basis as of December 2020. In north India, it has 5% market share in terms of capacity, according to DRHP filings.

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India has added 36,191 new companies between April to June this year
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