April 27, 13.06 PM IST || Pocket News Alert
Price Band fixed from Rs. 220 to Rs. 227 per Equity Share
Discount of up to Rs. 12 on Issue Price (per Equity Share) to all eligible Retail Individual Bidders and Eligible Employees
MUMBAI, Parag Milk Foods Limited proposes to open on Wednesday, May 4, 2016, a Public Issue of its equity shares of face value of Rs. 10 each for cash at a Price Band from Rs. 220 to Rs. 227 per Equity Share (including a share premium per Equity Share) consisting of a fresh issue of Equity Shares aggregating up to Rs. 3,000 million and an offer for sale of up to 20,572,573 Equity Shares comprising of 14,286,449 Equity Shares by the Investor Selling Shareholders; and 6,286,124 Equity Shares by Other Selling Shareholders (the “Offer for Sale” and the Offer for Sale and the Fresh Issue are collectively referred to as the “Issue”). The Issue includes a reservation of 300,000 Equity Shares for subscription by Eligible Employees (the “Employee Reservation Portion”). The Issue less the Employee Reservation Portion is referred to herein as the Net Issue.
Bids can be made for a minimum of 65 Equity Shares and in multiples of 65 Equity Shares thereafter. The Company and the Investor Selling Shareholders may, in consultation with the Book Running Lead Managers (the “BRLMs”), consider participation by Anchor Investors in accordance with the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009, as amended (the “SEBI Regulations”). The Anchor Investor Bid/Issue Period shall be one Working Day prior to the Bid/Issue Opening Date. The Bid/Issue Period will close on Friday, May 6, 2016.
The Issue is being made through the Book Building Process, in compliance with Regulation 26(2) of the SEBI Regulations, wherein at least 75% of the Net Issue shall be Allotted on a proportionate basis to Qualified Institutional Buyers (“QIBs”) (the “QIB Portion”), provided that the Company in consultation with the Investor Selling Shareholders and the BRLMs, may allocate up to 60% of the QIB Portion to Anchor Investors on a discretionary basis. Further, 5% of the QIB Portion (excluding the Anchor Investor Portion) shall be available for allocation on a proportionate basis to Mutual Funds only, and the remainder of the QIB Portion shall be available for allocation on a proportionate basis to all QIB Bidders (other than Anchor Investors), including Mutual Funds, subject to valid Bids being received at or above the Issue Price. If at least 75% of the Net Issue cannot be allotted to QIBs, then the entire application money shall be refunded forthwith. Further, not more than 15% of the Net Issue shall be available for allocation on a proportionate basis to Non-Institutional Bidders and not more than 10% of the Net Issue shall be available for allocation to Retail Individual Bidders in accordance with the SEBI Regulations, subject to valid Bids being received at or above the Issue Price. Further, 300,000 Equity Shares will be available for allocation on a proportionate basis to Eligible Employees, subject to valid Bids being received from them at or above Issue Price after the Employee Discount. The Company in consultation with the Investor Selling Shareholders and the BRLMs will offer a discount of up to Rs. 12 per Equity Share on the Issue Price to Eligible Employees and a discount of up to Rs. 12 per Equity Share on the Issue Price to the Retail Individual Bidders. Under-subscription, if any, in the Employee Reservation Portion will be added back to the Net Issue portion. All potential investors, other than Anchor Investors, are required to mandatorily utilise the Application Supported by Blocked Amount (“ASBA”) process by providing details of their respective bank account which will be blocked by the Self Certified Syndicate Banks (“SCSBs”), to participate in the Issue.
Parag Milk currently produces cheese under “Go” brand with a sizeable market share in the Rs $195 million cheese market in India. But, “Go Almette” brand has no competition in India as such products are not available. Parag Milk is planning to import “Go Almette” from Germany currently with future aim to set up a manufacturing plant in India.
Speaking to the media persons Devendra Shah, Chairman, Parag Milk said, “This launch is an attempt to continue our expansion in cheese market with a unique imported product. With this, we are broadening our portfolio of consumer health and nutrition based products.”
Parag Milk Foods sells its cheese under the brand name ‘Go’. The company’s cheese plant, located in Manchar, is one of Asia’s largest cheese plants having a production capacity of 40,000 tonnes/ day. It is one of the only two facilities in Asia having UHT technology. Moreover, Parag Milk Foods is one of the largest suppliers of cheese to hotels, restaurants, pizza chains, street food stalls in India. “We are also exporting to 33 countries worldwide including the Middle-East, North Africa and South-East Asia, etc,” mentions Devendra Shah, chairman, Parag Milk Foods.
To broaden its product range under the ‘Go’ cheese brand and penetrate further into the Indian cheese market, Parag Milk Foods has tied-up with German cheese manufacturer Hochland Group and has introduced the latter’s premium category cream cheese product ‘Almette’ into the India market. Parag Milk Foods also plans to tie-up with major e-commerce portals for consumers to buy it online. Shah adds, “Currently, we have launched two variants under Go-Almette and will soon be launching other variants as well. In the future we will be expanding our product portfolio with an increased focus on health and nutrition based products.”ends