FMCG company Adani Wilmar, which makes edible oil ‘Fortune’, has filed a draft red herring prospectus (DRHP) with market regulator Sebi to launch Rs 4,500-crore IPO. Adani Wilmar, a joint venture between Adani Group and Singapore-based Wilmar, was formed in 1999. It sells cooking oils under the Fortune brand as well as various other food products like rice and sugar. Adani Enterprises in a BSE filing said that the proposed listing of Adani Wilmar Ltd on the stock exchanges will comprise an IPO in the form of fresh issue of new equity shares by AWL for an amount of up to Rs 4,500 crore. “There will not be any secondary offering,” it added.
Adani Wilmar has planned to utilise the net proceed from the IPO to fund capital expenditure for expansion of AWL’s existing manufacturing facilities and developing new manufacturing facilities worth Rs 1,900 crore; repayment/prepayment of borrowings worth Rs 1,170 crore; to fund strategic acquisitions and investments worth Rs 500 crore; and for general corporate purposes.
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The company has also said that the proposed listing is intended to further the growth of AWL’s operations by increasing its market visibility and awareness among current and potential customers. Kotak Mahindra Capital Company, J.P.Morgan India Private Ltd, BofA Securities India, Credit Suisse Securities (India) Private Ltd, ICICI Securities, HDFC Bank, BNP Paribas are book running lead managers to the isue. Kin Intime India Private Ltd will be the registrar to the issue.
Upon successful completion of its IPO, Adani Wilmar will join the likes of Hindustan Unilever Ltd (HUL), Britannia Industries, Tata Consumer Products, Dabur India, Marico and Nestle India. The industry peer group average P/E ratio stands at 66.53x, and the weighted average return on net worth for the last three fiscals stood at 19.97 per cent. “As there is no assurance that the Proposed Listing will proceed, shareholders and potential investors are advised to exercise caution when dealing with the securities of the company,” Adani Enterprises said.
Currently, six Adani Group companies are listed on stock exchanges. Apart from Adani Enterprises, other listed ones are Adani Transmission, Adani Green Energy, Adani Power, Adani Total Gas, and Adani Ports and Special Economic Zone. Adani Wilmar has some of the marquee clients in the product categories. It is the largest manufacturer of Stearic acid and Glycerine in India. Also, it is one of the largest manufacturers of the soap noodles in India. Major clients of the company include polymer additives players like Fine Organics and Baerlocher, home & personal care companies HUL, Unilever Sri Lanka and Reckitt Benckiser.