Tarsons Products Ltd. will launch its three-day initial public offer on Monday, joining a myriad of companies in their race to list on the bourses amid a record run in the stock market.
The Kolkata-based labware maker's IPO, opening on Nov. 15, comprises a fresh issue and an offer-for sale by promoters Sanjive Sehgal and Rohan Sehgal, and existing private equity firm Clear Vision Investment Holdings Pte, according to its red herring prospectus. The maiden offer constitutes 29% of the post-issue equity of the company, with the promoters holding 47.3% after the share sale.
Fresh issue: Rs 1,023.8 crore
Offer-for-sale: Rs 150 crore
Price band: Rs 635-662 apiece
Market value at the upper end of the price band: Rs 3,522.30 crore
Before the float, the company had raised Rs 305.96 crore from 32 anchor investors at the upper end of the price band.
The company, present in designing, development and manufacturing of laboratory equipment, had a market share of 9-12% in 2020, the prospectus said citing a Frost and Sullivan report. It has five manufacturing facilities in West Bengal.
It plans to use Rs 62 crore toward capital expenditure and Rs 78.5 crore to reduce borrowing. The company's borrowings stood at Rs 105.95 crore as of September 2021, of which nearly Rs 56.60 crore were working capital loans.
Financial Highlights For 2020-21
Revenue from operations: Rs 228.91 crore
Profit after tax: Rs 68.87 crore
Ebitda: Rs 103.45 crore
Ebitda margin: 45.2%
Share Capital History
Tarsons Products' promoters/ existing shareholders had sold shares to Clear Vision in July 2018 at Rs 13,733.69 apiece or at Rs 51.83 apiece (adjusted for stock split and bonus). The company had also issued 22,00,000 compulsorily convertible debentures of Rs 100 face value in July 2018 to Clear Vision.
These CCDs had an option to convert into equity shares in three years at more than Rs 13,733.69 or the fair market value at the time of conversion.
The company converted these CCDs into class-B equity shares in March 2020. These CCDs also carried an option of buyback of shares. Based on a valuation report, the company bought back these equity shares at Rs 27,454 apiece in May 2021, or at Rs 10.4 apiece on ex-split and ex-bonus basis.
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