Penna Cement files for Rs 1,550-crore IPO
Hyderabad firm to use the proceeds for repaying borrowings, upgrading mills and setting up waste heat recovery plants
Hyderabad: Hyderabad-based Penna Cement Industries, an integrated cement company, filed for its Initial Public Offering to fundraise Rs 1,300 crore via a fresh issue of equity shares and an offer for sale of up to Rs 250 crore by the promoter selling shareholders, aggregating to Rs 1,550 Crore.
The funds will help repay/prepay Rs 550 crore of certain borrowings availed by the company besides funding capital expenditure requirements of Rs 105 crore for its KP Line II Project, Rs 80 crore towards upgrading its raw grinding and cement mill in Talaricheruvu, Rs 110 crore and Rs 130 crore towards setting up a waste heat recovery plant in Talaricheruvu and Tandur and general corporate purposes.
Incorporated in 1991, Penna offers major variants of cement, including Ordinary Portland Cement, Portland Pozzolana Cement and Portland Slag Cement. It operates four ISO certified integrated manufacturing facilities and two grinding units across Telangana, AP and Maharashtra with an aggregate capacity of 10 MMTPA as of March 31, 2021. The capacity is expected to reach 16.5 MMTPA by FY24.
In May 2019, the company acquired Singha Cement, a Sri Lankan cement company that operates a packing terminal in Colombo, to augment its focus on having a port-based distribution strategy.
Additionally, it has commissioned one of the largest port-based cement terminals in India at Krishnapatnam with an automated ship loading facility and packing terminals at Cochin, Gopalpur and Karaikal ports.
In fiscal 2021, the company’s revenue from operations, EBITDA and profit for the year stood at Rs 2,476.39 crore, Rs 479.84 crore and Rs 152.07 crore, respectively.
Investment Bankers appointed to the issue are Edelweiss Financial Services, Axis Capital, ICICI Securities, JM Financial Ltd and Yes Securities (India).
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