India Shelter Finance, DOMS Industries, 3 others get Sebi nod to float IPOs

Five firms, including affordable housing finance company India Shelter Finance, pencil maker DOMS Industries and lender Jana Small Finance Bank, have received capital markets regulator Sebi's go-ahead to raise funds through initial public offerings (IPOs).

The other two firms that obtained the regulator's nod to float maiden public issues are -- Vadodara-based Shiva Pharmachem and FMCG firm Onest Ltd. These five firms, which filed preliminary IPO papers with the regulator between July and August, obtained observation letters from November 7-16, an update with the Securities and Exchange Board of India (Sebi) showed on Tuesday. In Sebi's parlance, obtaining observation letters means its go-ahead to launch the IPO. Going by the draft papers, the Rs 1,800-crore proposed IPO of India Shelter Finance comprises a fresh issue of equity shares worth Rs 1,000 crore and an offer for sale (OFS) of Rs 800 crore by investor shareholders.

Those offering shares in the OFS include -- Catalyst Trusteeship Ltd, Madison India Opportunities IV, MIO Starrock, Nexus Ventures III Ltd, and Nexus Opportunity Fund II Ltd. India Shelter Finance, which is backed by Westbridge Capital and Nexus Venture Partners, plans to utilise the proceeds of the fresh issue to meet future capital requirements towards onward lending and for general corporate purposes. The pencil maker's maiden public issue consists of a fresh issue aggregating up to Rs 350 crore and an OFS aggregating up to Rs 850 crore by promoters, according to the draft red herring prospectus (DRHP). Under the OFS, corporate promoter F.I.L.A. -- Fabbrica Italiana Lapis ed Affini S.p.A. -- will offload shares worth Rs 800 crore and individual promoters -- Sanjay Mansukhlal Rajani and Ketan Mansukhlal Rajani will sell shares to the tune of Rs 25 crore each. The funds raised through the fresh issue would be used for setting up a new manufacturing facility to expand the company's production capabilities for a range of writing instruments, watercolour pens, markers and highlighters, as well as for general corporate purposes.

Jana Small Finance Bank's IPO comprises a fresh issue of shares aggregating up to Rs 575 crore and an OFS of up to 4,051,516 equity shares by the company's existing investors. Those offering shares in the OFS are Client Rosehill Ltd, CVCIGP II Employee Rosehill Ltd, Global Impact Funds, S.C.A., SICAR, Sub-Fund Global Financial Inclusion Fund, Growth Partnership II Ajay Tandon Co-Investment Trust, Growth Partnership II Siva Shankar Co-Investment Trust, and Hero Enterprise Partner Ventures.

The small finance bank proposed to utilise the net proceeds from the fresh issue towards augmenting its Tier – 1 capital base to meet future capital requirements such as organic growth and expansion. The IPO of Shiva Pharmachem is entirely an OFS of up to Rs 900 crore by promoters. Since the IPO is completely an OFS, the entire proceeds will go to the selling shareholders and the company will not receive any funds from the issue. The initial share sale of Onest comprises a fresh issue of Rs 77 crore and an OFS of up to 32.5 crore shares by a promoter and other selling shareholders. Proceeds from the fresh issue to the tune of Rs 60 crore will be utilised towards funding the working capital requirements of the company and a portion will be used for general corporate purposes.