Eswari Global Metal Industries Files Rs 1,100-1,300-Cr IPO, Seeks to Raise Funds for Expansion and Debt Repayment
Eswari Global Metal Industries Ltd has filed preliminary papers with the Securities and Exchange Board of India (Sebi) to raise Rs 1,100-1,300 crore through an initial public offering (IPO), according to a draft red herring prospectus (DRHP) filed on Sunday. The offering includes a fresh issue of equity shares worth up to Rs 500 crore and an offer-for-sale (OFS) of up to 1.32 crore equity shares by promoters and a selling shareholder, as disclosed in the filing.
IPO Structure: Equity Shares and Share Sale Details
The IPO comprises a fresh issue of equity shares valued at Rs 500 crore and an OFS of 1.32 crore shares, according to the DRHP. Promoters including C Bharanikumar, Pradeep Chandrasekaran, and others are set to offload shares through the OFS, while Palaniappan Ramalingam is the other selling shareholder. The company may also explore a pre-IPO placement of up to Rs 100 crore, which could reduce the fresh issue size, as per market sources.
Fund Allocation: Expansion, Debt, and Corporate Purposes
Proceeds from the fresh issue will be allocated as follows: Rs 150 crore for the Phase-II expansion of its manufacturing facility in Mundra, Gujarat; Rs 250 crore for debt repayment; and the remainder for general corporate purposes, according to the DRHP. The company’s focus on expansion aligns with its role as an integrated multi-metal recycling and manufacturing entity, operating nine facilities across Karnataka and Tamil Nadu.
Financials: 2022 Revenue and Profit Metrics
For the nine months ended December 2022, Eswari Global Metal Industries reported revenue of Rs 1,401.5 crore and a net profit of Rs 83.9 crore, according to the DRHP. The company, incorporated in 1987, specializes in recycling non-ferrous metals, plastics, and e-waste, producing value-added products like pure lead, aluminium alloys, and copper ingots for sectors including automotive and battery manufacturing.
Lead Managers: Key Advisors and Registrars
DAM Capital Advisors, ICICI Securities, and Motilal Oswal Investment Advisors are serving as book-running lead managers for the IPO, while KFin Technologies is the registrar, as per the DRHP. The company’s IPO comes amid growing interest in India’s recycling and manufacturing sectors, driven by sustainability trends and industrial demand.
Strategic Importance: Scaling Operations and Reducing Debt
The IPO reflects Eswari Global Metal Industries’ strategic push to scale operations and reduce debt, following a period of steady growth. With a total installed production capacity of 165,106 metric tonnes per annum as of December 2022, the company aims to leverage the funds for expansion and operational efficiency, according to the DRHP.