Exxaro Tiles IPO: Here are 9 things that you should know about the issue

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Leading manufacturer of vitrified tiles Exxaro Tiles is set to raise Rs 161.09 crore through an initial public offer (IPO) next week. Here are all the details about the offer.

Open and close date: The offer will open for subscription on August 04 and the bidding will close on August 06. The anchor book, if any, will open for a day before the issue opening, i.e. August 03.

Price band: The price band for the tile manufacturer has been fixed at Rs 118-120 per share having a face value of Rs 10 per share.

Lot size: Investors can bid for a minimum of 125 equity shares and in multiples, thereafter, translating to a minimum bidding amount of Rs 14,850 at the higher end of the price band. A retail investor can at max apply for 13 lots or 1,625 shares for Rs 1,95,000.

Issue size: The Rs 161.09-crore public offer comprises fresh issuance of equity shares of Rs 134.23 crore, and an offer for sale (OFS) of 22,38,000 shares totalling Rs 26.86 crore by selling shareholder Dixitkumar Patel. The offer includes a reservation of up to 2,68,500 equity shares or 2% of the issue for the company’s employees.

Objective of issue: The company will utilise the net proceeds of fresh issue towards repayment and/or prepayment of secured borrowings availed by the company upto Rs 50 crore. Rs 45 crore to meet its working capital requirements and the rest for general corporate purposes.

What’s in it for retail investors: Not more than 25% of the total offer has been reserved for qualified institutional buyers, up to 40% for retail investors, and the rest 35% for non-institutional buyers.

About the company: Exxaro Tiles is engaged in the manufacturing and marketing activities of vitrified tiles. The company manufactures Double Charge Vitrified Tiles (double layer pigment) and Glazed Vitrified Tiles made from ceramic materials i.e. clay, quartz, and feldspar. Its product portfolio consists of 1000+ different designs of tiles in 6 sizes.

Currently, it operates two state-of-the-art manufacturing facilities in Padra and Talod with an installed production capacity of 1,32,00,000 sq mt per annum. It further has 6 display centres in 6 cities and 2 marketing offices in Delhi and Morbi.

For the financial year ended March 31, 2021, the company reported total revenue of Rs 259.85 crore compared to Rs 244 crore in FY19. However, its profit grew at a faster pace from Rs 8.9 crore in FY19 to Rs 15.22 crore in FY21.

Book Running Lead Managers and Registrar to the IPO: The book running lead managers to the issue is Pantomath Capital Advisors. The registrar to the issue is Link Intime.

Issue timeline: The issue is likely to finalize the basis of allotment by August 11, and the initialization of refunds will take place by August 12. While the credit of equity shares to depository accounts of the allottee will be done on August 13. The tile manufacturer is expected to make its stock market debut on August 17, 2021.