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India Pesticides, KIMS receive Sebi’s approval to launch IPOs

india pesticides ipo

India Pesticides and the Krishna Institute of Medical Sciences have secured Sebi’s approval to float initial share sales.

The two companies filed their preliminary papers with the Securities and Exchange Board of India (Sebi) in February.

Krishna Institute of Medical Sciences and India Pesticides received Sebi’s observation on April 28 and April 30, respectively, an update with Sebi revealed on Monday.

Sebi’s observation is essential for any company to roll out public issues like initial public offer (IPO), follow-on public offer (FPO), and rights issue.

India Pesticides’ Rs 800-crore IPO includes a fresh issuance of shares worth Rs 100 crore and an offer of sale of Rs 700 crore by promoter and technocrat Anand Swarup Agarwal and other shareholders, as stated in the draft red herring prospectus.

The Uttar Pradesh-based company may decide to launch a pre-IPO placement of Rs 75 crore, subject to consultation of the merchant bankers.

The funds raised in the fresh issue would be utilized for financing the working capital requirements and general corporate purposes.

India Pesticides is an R&D-focused agrochemical technical company, which has rising formulations business in herbicides, insecticides, and fungicide segments. It also produces active pharmaceutical ingredients (APIs).

It is the only Indian manufacturer and amongst the top-five companies internationally for multiple technical products such as folpet and cynomoxanil, used to make fungicides that regulate fungal growth across several crops.

At present, India Pesticides works from two manufacturing facilities at Lucknow and Hardoi in Uttar Pradesh with a total capacity of 19,500 MT for technicals and 6,500 MT for the formulations vertical.

According to the draft papers, KIMS’ initial public offering consists of a fresh issue of shares aggregating up to Rs 200 crore and an offer for sale of up to 21,340,931 equity shares from promoters and existing shareholders.

A total of 1,39,77,991 equity shares would be offered by General Atlantic Singapore KH Pte Ltd under the offer for sale, up to 7,75,933 equity shares by Bhaskara Rao Bollineni, up to 11,63,899 equity shares by Rajyasri Bollineni, up to 3,87,966 equity shares by Bollineni Ramanaiah Memorial Hospitals Pvt Ltd.

The offer includes a reservation for subscriptions by qualified employees.

According to merchant banking sources, the IPO is expected to raise Rs 700 crore.

The funds raised from the fresh issue will be utilized to repay the debt of the company and its subsidiaries.

KIMS is one of the largest corporate healthcare groups in Andhra Pradesh and Telangana in terms of the number of patients treated and treatments provided.

It runs nine multi-specialty hospitals under the ‘KIMS Hospitals’ label, with a total bed capacity of 3,064, including more than 2,500 operational beds as of December 31, 2020.

The equity shares of both companies are intended to be listed on the BSE and the NSE.

As predicted by UBS, 2021 is looking at several companies launching their IPOs. If the IPO is successful, India Pesticides and KIMS will have a great opportunity to expand its business.

Shishir Gupta, Founder and CEO, StartupLanes

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