Penna Cement files Rs 1,550-crore IPO papers with Sebi

NEW DELHI: Penna Cement has filed preliminary papers with capital markets regulator Sebi to raise Rs 1,550 crore through an initial share-sale. The initial public offer (IPO) comprises fresh issue of equity shares worth Rs 1,300 crore and an offer for sale of up to Rs 250 crore by the promoter, according to draft red herring prospectus.

Proceeds from fresh issue will be used to pay debts of Rs 550 crore. Besides, Rs 105 crore will be utilised for funding capital expenditure requirements for its KP Line II Project and Rs 80 crore towards upgrading its raw grinding and cement mill in Talaricheruvu.

In addition, the company will use Rs 130 crore and Rs 110 crore towards setting up a waste heat recovery plant in Tandur and Talaricheruvu respectively.

Hyderabad-based Penna Cement has a strong brand recall in southern and western states of the country. It operates out of four integrated manufacturing facilities and two grinding units across Andhra Pradesh, Telangana and Maharashtra with an aggregate capacity of 10 MMTPA as of March, 2021 and the capacity is expected to reach 16.5 MMTPA by FY24.

In fiscal 2021, the company’s reported a profit of Rs 152.07 crore and revenue from operations stood at Rs 2,476.39 crore.

Edelweiss Financial Services Ltd, Axis Capital Ltd, ICICI Securities Ltd, JM Financial Ltd and Yes Securities (India) Ltd are the merchant bankers that will advise the company on the IPO.

This is the company’s second attempt to go public. Earlier in November 2018, Penna Cement had filed draft papers with Sebi to float Rs 1,550-crore initial share-sale and had received its clearance too. However, the cement player did not launch the IPO.