Midwest Receives SEBI Approval for IPO to Raise ₹650 Crore

Midwest, one of India’s largest producers of Black Galaxy Granite, has received approval from the Securities and Exchange Board of India (SEBI) to proceed with its initial public offering (IPO). The Hyderabad-based company plans to raise funds through a combination of fresh share issuance and an Offer for Sale (OFS) by promoters.

IPO Structure and Fund Utilisation

Midwest’s IPO comprises a fresh issue of shares worth ₹250 crore and an OFS amounting to ₹400 crore, as per the Draft Red Herring Prospectus (DRHP). Promoters Kollareddy Rama Raghava Reddy and Guntaka Ravindra Reddy will offload shares worth ₹360 crore and ₹40 crore, respectively, in the OFS. Additionally, the company may raise ₹50 crore in a pre-IPO placement, which would reduce the fresh issue size accordingly.

Proceeds from the fresh issue will be allocated to various business initiatives. Midwest Neostone, its wholly-owned subsidiary, will receive ₹127.05 crore for capital expenditure related to the second phase of a quartz grit and powder processing plant. The company has also earmarked ₹25.75 crore for the purchase of electric dump trucks and ₹3.26 crore for integrating solar energy at selected mining locations. Furthermore, ₹53.80 crore will be utilised for debt repayment, with the remaining funds allocated for general corporate purposes.

Midwest’s Industry Presence and SEBI Approval

Midwest, a leading producer and exporter of Black Galaxy Granite, filed its IPO papers with SEBI in October 2024 and received the regulatory observation letter on 4 February 2025. This approval grants the company permission to launch its public issue.

Black Galaxy Granite, known for its sparkling golden-hued flakes, is widely used in real estate applications, including countertops, flooring, and cladding. Midwest’s strong presence in this premium segment positions it as a significant player in the natural stone industry.

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