Godavari Biorefineries IPO Opens on October 23, 2024: Key Things to Know

The much-anticipated IPO of Godavari Biorefineries Ltd. opens for subscription from October 23 to October 25, 2024. The company, known for its ethanol-based chemicals, has set the price band between Rs 334 and Rs 352 per share, aiming to raise up to Rs 554.75 crore. Investors can bid for one lot of 42 shares or multiples thereof. This IPO marks a significant event for the company, and here’s everything you need to know before subscribing.

Price Band and IPO Structure

Godavari Biorefineries has set a price band of Rs 334 to Rs 352 per equity share. At the upper end, the IPO aims to raise Rs 554.75 crore, with Rs 325 crore coming from a fresh issue of shares and Rs 229.75 crore via an Offer for Sale (OFS). Private equity firm Mandala Capital AG will exit its entire 49,26,983 shares through the OFS.

Key Investor Segments

The company has reserved 50% of the total offer for institutional investors, 15% for non-institutional investors, and 35% for retail investors. This allocation ensures diverse investor participation, making it a balanced offering.

Use of Proceeds

The proceeds from the fresh issue will primarily be used to repay certain outstanding debts, while the proceeds from the OFS will benefit the selling shareholders. The company’s focus on debt repayment could potentially strengthen its financial position post-IPO.

Business Overview

Godavari Biorefineries operates an integrated biorefinery with a capacity of 570 KLPD for ethanol production. It supplies ethanol, bio-based chemicals, and power to key clients like Hershey India, Hindustan Coca-Cola Beverages, and LANXESS India. The company’s diverse product portfolio serves industries such as food, beverages, pharmaceuticals, and personal care.

Financial Performance

On the earnings front, Godavari Biorefineries has seen a decline. For FY24, its profit fell to Rs 12 crore from Rs 19.6 crore in FY23, while revenue dropped to Rs 1,686.7 crore from Rs 2,014.7 crore. Additionally, the company posted a loss of Rs 26.1 crore on revenue of Rs 522.5 crore for the June 2024 quarter, reflecting financial challenges.

IPO Timeline and Listing

Equirus Capital Private Ltd. and SBI Capital Markets Ltd. are the book-running lead managers for the IPO, and Link Intime India Private Ltd. is the registrar. The allotment of shares is expected to be finalized on October 28, and the stock will likely be listed on BSE and NSE by October 30, 2024.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.