InvestorQ : Can you tell me about the forthcoming IPO of Indigo Paints?
vidhya Laxmi made post

Can you tell me about the forthcoming IPO of Indigo Paints?

sarah Leo answered.
12 months ago

The IPO mania of the second half of 2020 appears to be continuing unabated in the first quarter of 2021 too. After IRFC filed for its Rs.4600 crore IPO, the next in line is Indigo Paints which has filed for the IPO. Here are some of the highlights of the issue.

· Indigo Paints announced that its initial public offer or IPO will open on 20-Jan and close for subscription on 22-Jan after being open for 3 working days.

· Indigo Paints has fixed the IPO price in the band of Rs.1488-1490 per share for its initial share-sale. The market expectation is of price fixation at the upper end of the band.

· The grey market premium or GMP for the stock is already in the range of 50% to 60% and while this is not conclusive, it is indicative of pent up demand for the IPO.

· The IPO will comprise of a fresh issuance of Rs.300 crore and an offer for sale of Rs.870 crore taking the total issue size to Rs.1170 crore at the upper end of the price band.

· Apart from the promoter partially monetizing his stake in Indigo Paints, one of its early investors, Sequoia Capital, will also exit part of its stake via the offer for sale or OFS.

· The anchor investor portion subscription will be open for a single day on 19-Jan and the BRLMs are expecting strong response from domestic and global institutions.

· The company has reserved 35% of the issue size for retail investors investing up to Rs.2 lakhs, 15% for HNIs and 50% for qualified institutional buyers or QIBs.

· Indigo will use the proceeds of the IPO for expansion of its existing facility in Tamil Nadu. Indigo currently has 3 major facilities for manufacturing paints across India.

· Indigo Paints predominantly operates in the decorative paints segment and has a vast network and distributor franchise pan-India.