Hinduja Leyland Finance, CL Educate added to India’s IPO pipeline


Hinduja Leyland Finance

Capital market regulator SEBI has given its go-ahead to Hinduja Leyland Finance and CL Educate to bring their IPOs. Both companies filed their respective prospectuses with SEBI in March. Hinduja Leyland Finance (HLF) is an arm of Ashok Leyland while CL Educate is a pan-India test-preparation player based out of New Delhi. CL Educate offers its services under the Career Launcher brand. With the latest approvals, India’s IPO pipeline increases to 21.

Read Also: Hinduja Leyland Finance, CL Educate file IPO papers with SEBI

Hinduja Leyland Finance, engaged in commercial vehicle financing business, said in its draft prospectus it planned to issue new shares worth INR5 billion (INR500 crore) while another 26,608,810 shares are to be sold by existing shareholders. Private equity player Everstone Capital invested around INR2 billion in HLF in 2013 for nearly 15% equity stake. In total, Hinduja Leyland Finance IPO is likely to mobilize around INR7 billion.

Incidentally, another Everstone-backed company VLCC is armed with SEBI approval and is reportedly ready to bring its IPO in immediate months.

Read Also: Everstone-backed VLCC files IPO prospectus

Hinduja Leyland Finance has been a robust performer on the financial front. Revenues rose from INR6.4 billion in FY2014 to INR8.2 billion in FY2015. In the same timeframe, net profit increased from INR780 million INR1.11 billion, according to the prospectus. The IPO will be managed by Axis Capital, ICICI Securities, SBI Capital Markets and Yes Securities.

CL Educate – Second time candidate

Similarly, CL Educate – latest addition to India’s IPO pipeline – plans to sell a total of 4,690,533 equity shares through its IPO. The IPO will include a fresh issue of 2,060,652 shares and an offer for sale (OFS) of up to 2,629,881 shares by existing shareholders. The OFS will include several investors, most prominent being Gaja Capital. The company said proceeds of INR969 million from fresh issue will be used for acquisitions and other strategic initiatives, repayment of loans, and to fund working capital requirements. Kotak Mahindra Capital Company will be the sole book running lead manager (BRLM) for the IPO.

The education-focused player had filed its papers with SEBI earlier in September 2014, before withdrawing in August 2015. At the time of withdrawing its application, CL Educate said it is considering strategic opportunities.


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