Primary market set for another busy week; 4 companies set to launch IPOs to raise Rs 5,000 crore

The primary market continues to be a busy one with four firms, including Archean Chemical Industries and Five Star Business Finance, are set to float their IPOs next week to collectively raise about Rs 5,000 crore.

The other two firms whose initial public offerings (IPOs) are ready to open are -- Kaynes Technology India and Inox Green Energy Services.

This came after four companies launched their initial share-sales last week. Of these, two IPOs -- maker of snacks and sweets Bikaji Foods International and Global Health Ltd which operates hospitals under the Medanta brand -- are currently underway.

The IPOs of Archean Chemical and Five Star Business will be open for public subscription on November 9 and close on November 11, while that of Kaynes Technology and Inox Green are set to kick off on November 10 and November 11 respectively, as per the red herring prospectus (RHP).

So far in 2022, as many as 26 companies have floated their IPOs to raise over Rs 48,000 crore. In 2021, 63 IPOs had mopped up over Rs 1.19 lakh crore, the data with exchanges showed.

According to market experts, volatility in the secondary market led to a weak IPO market in 2022.

Non-banking lender Five Star Business Finance's IPO is entirely an offer for sale (OFS) of shares to the tune of Rs 1,960 crore by existing shareholders and promoter group entities.

The OFS will see the sale of shares to the tune of Rs 166.74 crore by SCI Investments V, Rs 719.41 crore by Matrix Partners India Investment Holdings II LLC, Rs 12.08 crore by Matrix Partners India Investments II Extension LLC, Rs 361.44 crore by Norwest Venture Partners X- Mauritius and Rs 700.31 crore by TPG Asia VII SF Pte Ltd.

The Chennai-headquartered firm has set a price band of Rs 450-474 per equity shares. The NBFC is backed by investors like TPG, Matrix Partners, Norwest Ventures, Sequoia and KKR.

The IPO of speciality marine chemical manufacturer Archean Chemical consists of a fresh issue of equity shares aggregating up to Rs 805 crore and an offer for sale (OFS) of up to 1.61 crore shares by the promoter and investors, including the India Resurgence Fund, a joint venture between the Piramal Group and Bain Capital.

Promoter Chemikas Speciality will sell 20 lakh shares via OFS, while investors Piramal Natural Resources and India Resurgence Fund will sell 38.35 lakh shares each. India Resurgence Fund II will divest 64.78 lakh shares.

The price band has been set at Rs 386-407 a share for the issue, which is expected to fetch Rs 1,462.3 crore at the upper end of the band. The company plans to use the proceeds of the fresh issue for the redemption of non-convertible debentures (NCDs) issued by it.

The initial share-sale of Kaynes Technology, an IoT (Internet of Things) solutions-enabled integrated electronics manufacturing company, comprises fresh issue of equity shares worth Rs 530 crore and an OFS of up to 55.85 lakh equity shares by a promoter and an existing shareholder.

The OFS comprises sale of 20.84 lakh equity shares by promoter Ramesh Kunhikannan and 35 lakh equity shares by existing shareholder Freny Firoze Irani.

According to merchant banking sources, the issue is expected to mop up over Rs 850 crore.

Proceeds from the fresh issue will be used to repay debt, funding capital expenditure for its manufacturing facilities at Mysore and Manesar and funding working capital requirements. Also, the company plans to invest in its arm Kaynes Electronics Manufacturing for setting up a new facility at Chamarajanagar in Karnataka.

The Rs 740-crore IPO of Inox Green, an arm of Inox Wind, comprises a fresh issue and an offer for sale of Rs 370 crore each. The issue will open on November 11 and close on November 15.

Proceeds from the fresh issue will be utilised for repaying debts and general corporate purposes.

The equity shares of the four companies will be listed on the BSE and NSE.