Winning Bizness Desk
Mumbai. The Securities and Exchange Board of India has cleared the initial public offering proposals of five companies, including Duroflex and Hexagon Nutrition. On February 13, the market regulator issued its observations on their draft papers, allowing the firms to move ahead with their public issues in the coming months. With this nod from Sebi, the companies can now decide their issue dates and price bands before launching their IPOs.
The five companies that received approval are Duroflex, Virupaksha Organics, Premier Industrial Corporation, Om Power Transmission and Hexagon Nutrition. These firms plan to raise funds through a mix of fresh share issuance and offer for sale routes, depending on their respective structures.
Duroflex plans fresh issue and OFS
Mattress maker Duroflex plans to issue fresh shares worth Rs 183.6 crore. In addition, existing investors and promoters will sell 2.25 crore shares through an offer for sale. The proceeds from the fresh issue are expected to be used for repaying debt and expanding manufacturing capacity.
Key details of Duroflex IPO:
- * Fresh issue size: Rs 183.6 crore>
- * OFS component: 2.25 crore shares
- * Fund use: Debt repayment and capacity expansion
Duroflex operates in the sleep solutions segment and manufactures mattresses, foam products, beds and pillows. The company is widely known for its orthopedic mattresses and has been operating in the sector for nearly 50 years.
Virupaksha and Premier Industrial plans
Virupaksha Organics will launch a fully fresh issue IPO, aiming to raise Rs 740 crore. Since it is entirely a fresh issue, the entire proceeds will go to the company. The funds will be utilised for working capital needs and general corporate purposes.
Virupaksha Organics is a research-based pharmaceutical company. It primarily manufactures active pharmaceutical ingredients and intermediates that are used in the production of medicines.
Premier Industrial Corporation, on the other hand, will issue 2.25 crore new shares and offer 54 lakh shares for sale. The company manufactures raw materials for the welding industry, including ferro alloy powder, metal powder and various types of wires.
Om Power and Hexagon Nutrition structure
Om Power Transmission plans to issue 90 lakh fresh shares, while promoters will offload 10 lakh shares through the offer for sale route. The company operates as an electrical engineering and contracting firm. It undertakes construction and maintenance of power transmission lines and substations.
Hexagon Nutrition’s IPO will be entirely through offer for sale. Existing shareholders will sell 3.08 crore shares, and the company will not receive any fresh funds from the issue.
Highlights of Hexagon Nutrition IPO:
- * Entirely OFS of 3.08 crore shares
- * No fresh capital for company
- * Existing investors to monetise holdings
Hexagon Nutrition manufactures health drinks for children and clinical nutrition food products. It also supplies nutritional premixes to large companies such as Amul and Dabur.
What Sebi approval and issue types mean
When a company intends to raise money from the capital market, it must first file a Draft Red Herring Prospectus with Sebi. The regulator reviews the document to ensure that all material information has been disclosed to investors. Once Sebi issues its observations, it indicates that there are no regulatory objections at that stage.
There are two main routes to raise funds through an IPO:
- * Fresh issue: The company issues new shares and the proceeds go directly to its account for business expansion or debt repayment.
- * Offer for sale: Existing shareholders sell their shares and the proceeds go to them, not to the company.
With Sebi’s clearance now in place, these five companies are expected to tap the primary market over the next few months, subject to market conditions and final approvals.
