The IPO includes a fresh issue of Rs 1,400-1,500 crore and an offer for sale of Rs 3500 crore by the promoters, according to market sources.
Nuvoco didn’t respond to ET’s queries.
, HSBC Securities, JP Morgan and SBI Capital Markets are the investment bankers for the issue.
The company is looking at a valuation of Rs 35,000 crore after listing, which is the same as
’s current market capitalization. The top three cement companies – UltraTech, Shree Cement and Ambuja – are currently valued at Rs 1.82 lakh crore, Rs 1 lakh crore and Rs 61,000 crore, respectively.
Nuvoco Vistas, formerly known as Lafarge India, has a strong presence in the east. It is looking to deleverage its balance sheet by cutting its debt via the fund raised from the IPO. As on March 31, 2020, the company had a total borrowing of Rs 4,463 crore.
Nirma Group forayed into the cement business in 2014 through a greenfield investment in a plant at Nimbol and thereafter grew the business with the acquisition of Larfarge’s India Cement business in 2016. In 2020, the company acquired Emami Cement. Collectively, the acquisitions and mergers have almost doubled its cement manufacturing capacity and increased the reach of its distribution.
Nirma’s Karsanbhai Patel and his family owns 100% stake in Nuvoco Vistas. The company owned 7 plants as of March 2020 with a cumulative capacity of 14 mt. The company also owns 60 ready-mix concrete plants.
The company’s growing modern building material products business is a key differentiator and it sells a wide range of products such as construction chemicals, tile adhesives, wall putty, dry plaster, cover blocks and ready-mix dry concrete. It competes with national players such as Ultratech Cement, LH Group,
Ltd and Shree Cement.
For the year ended March 31, 2020, the company has posted a net profit of Rs 249 crore compared to a loss of Rs 23.80 crore in FY19. However, the company’s net sales dropped 4% to Rs 6,793 crores in FY20 compared to Rs 7053 crores in FY19.