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Shyam Metalics & Energy files for Rs 1107 cr IPO

Shyam Metalics & Energy files for Rs 1107 cr IPO

Mumbai, Feb 27 (UNI) Shyam Metalics and Energy Ltd, a leading integrated metal producing company has refiled its Draft Red Herring Prospectus (DRHP) with the markets regulator for an Rs 1107 cr IPO.

The company tried to tap the capital markets in 2018 and had even received its SEBI Nod in early 2019. However, due to the pandemic and tepid market sentiments, the Company deferred its plans to list on the bourses.

The aggregate issue size of Rs 1107 cr comprises a Fresh Issuance of equity shares aggregating up to Rs 657 cr and an Offer For Sale by selling shareholders ie Promoter and Promoter Group - Subham Capital, Subham Buildwell, Kalpataru Housefin & Trading, Dorite Tracon, Narantak Dealcomm and Toplight Mercantiles aggregating up to Rs. 450 cr The offer includes a reservation of up to 3,00,000 equity shares for eligible employees.

The Company intends to utilize the net proceeds from the fresh issue for repayment or prepayment of Rs 470 crs of its debt and that of its subsidiary, Shyam SEL and Power Ltd; and for other general corporate purposes.

The portion reserved for Qualified Institutional Buyers will be up to 50 pc of the offer, Non-Institutional Investors to have up to 15 pc of the portion reserved while up to 35 pc will be reserved for the Retail Investors.

The Kolkata based long steel products and ferroalloy focused company has been EBITA positive since its operations in 2005 and sells intermediate and final products across the steel value chain catering to institutional and end-use customers through 42 distributors, brokers across 13 states and 1 union territory.

The Company currently operates three manufacturing plants that are located at Sambalpur in Odisha and Jamuria and Mangalpur in West Bengal.

The company sells Thermo mechanically treated bars and structural products under the SEL brand name and as of Dec 31, 2020, had an aggregate metal capacity of its three manufacturing plants at 5.71 million tonnes per annum which stands to increase to 11.60 mn MTPA as per the ongoing capacity expansion plans by FY2025. It was the fourth-largest player in the sponge iron industry when compared with Indian peers on the basis of capacity.

Additionally, SMEL is looking to enter segments such as pig iron, ductile iron pipes and aluminium foil and is in the process of commissioning an aluminium foil rolling mill at Pakuria in West Bengal with a proposed installed capacity of 0.04 MTPA, expected to become operational by FY2022.

ICICI Securities Ltd, JM Financial Ltd, Axis Capital Ltd, IIFL Securities Ltd and SBI Capital Markets Ltd are the BRLMS to the Issue.

UNI JS RHK1338

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