Upcoming IPO: Godavari Biorefineries To Open For Subscription On October 23; Check Key Dates & More

Godavari Biorefineries is gearing up for its initial public offering (IPO), set to open for subscription on October 23 and close on October 25. The company has fixed the price band for its IPO between Rs 334 and Rs 352 per share, aiming to raise a total of Rs 554.75 crore through a combination of fresh equity and an offer-for-sale (OFS) component.

IPO Structure and Details

The IPO comprises a fresh issue of shares valued at Rs 325 crore, alongside an OFS amounting to Rs 229.75 crore. The OFS will see Mandala Capital selling its entire stake of 49,26,983 equity shares, which were acquired at an average price of Rs 188.91 per share. Additional shareholders selling their stakes include promoters like Somaiya Agencies Private Limited, Samir Shantilal Somaiya, and several others.

The anchor investment date is set for October 22, with the allotment of shares expected on October 28 and a potential listing on October 30. The share allocation for the IPO will be structured as follows: 50% for qualified institutional buyers (QIBs), 35% for retail investors, and 15% for non-institutional investors (NIIs).

About Godavari Biorefineries

Godavari Biorefineries is a manufacturer of ethanol-based chemicals in India, boasting an integrated bio-refinery with an installed capacity of 570 kiloliters per day (KLPD). As of March 31, 2024, the company ranks among the largest producers of ethanol in India based on volume.

The company offers a product portfolio that includes bio-based chemicals, sugar, various grades of ethanol, and power. These products cater to multiple industries such as food and beverages, pharmaceuticals, flavours and fragrances, power generation, fuel, personal care, and cosmetics.

Promoters and Shareholding Structure

The promoters of Godavari Biorefineries include Samir Shantilal Somaiya, Lakshmiwadi Mines and Minerals, Sakarwadi Trading Company, and Somaiya Agencies Private Limited. Collectively, these entities hold a total of 2,71,12,386 shares, translating to a 64.64% ownership stake in the company.

Financial Performance

In terms of financial performance, Godavari Biorefineries reported a profit of Rs 12.30 crore for the year ending March 31, 2024, a decline from Rs 19.64 crore in the previous year. Revenue for the same period also saw a decrease, dropping to Rs 1,701.06 crore from Rs 2,023.08 crore year-on-year.

Godavari Biorefineries faces competition from several industry peers, including Alkyl Amines Chemicals, which has a price-to-earnings (P/E) ratio of 78.84. Other notable competitors include Jubilant Ingrevia (P/E of 64.10), Laxmi Organic Industries (P/E of 65.11), EID Parry (P/E of 16.69), and Balrampur Chini Mills (P/E of 24.72), among others.

Use of IPO Proceeds

The funds generated from the fresh share sale are earmarked for crucial financial activities, including the repayment or pre-payment of certain borrowings and general corporate purposes.

Investors eyeing the Godavari Biorefineries IPO should consider the company's business model, market positioning, and financial performance as key factors in their decision-making process. With the IPO opening soon, potential investors should stay informed about the latest updates, including any changes in the offering structure or market conditions.