SH Kelkar receives SEBI nod for INR200 crore IPO


S H Kelkar and Company Limited has received capital market regulator SEBI’s nod to bring its initial public issue (IPO). Final observations by the market regulator were issued on 18 June in this regard. The company had filed its prospectus through J M Financial Institutional Securities Limited on 24 March 2015.

In its draft red herring prospectus (DRHP), the Mumbai-based company said it planned to raise INR200 crore through the sale of new shares. In addition, existing investors plan to sell 1.55 crore shares through an offer for sale (OFS). The issue will be managed by J M Financial Institutional Securities Limited and Kotak Mahindra Capital Company Limited.

Use of funds

Majority of the proceeds will be used towards part pre-payment of loans availed by the company and its wholly owned subsidiary K V Arochem Private Limited while the rest will be used for general corporate purposes. The fragrance maker plans to spend INR110 crore in debt repayment in its books while INR40 crore will be invested in K V Arochem Private Limited – S H Kelkar’s wholly owned subsidiary – for repayment and pre-payment of loans.

Selling shareholders

S H Kelkar counts private equity player Blackstone Group among its investors. Through its various arms, Blackstone holds 4.35 crore shares in S H Kelkar, amounting to pre-issue equity stake of 32.93%. Out of its total, Blackstone plans to offload 1.32 crore shares in the IPO. Company promoter Prabha Ramesh Vaze also plans to sell 23.37 lakh shares.

IPO momentum building up

S H Kelkar will be ninth company this year to raise funds from India’s booming primary market. Seven companies Ortel Communications Ltd, Adlabs Entertainment Ltd, Inox Wind Limited, VRL Logistics Ltd, MEP Infrastructure Developers, UFO Moviez India, and PNC Infratech have collectively raised INR3,445 crore through IPOs so far this year while Manpasand Beverages has scheduled its INR400 crore IPO for 24 June.


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