Economy

Godrej Agrovet IPO subscribed 51% on first day

Godrej Agrovet IPO subscribed 51% on first day”

The company on Tuesday raised Rs 341.19 crore ($52 million) from anchor investors including Singapore sovereign wealth fund GIC ahead of its initial public offering.

Godrej Agrovet, a subsidiary of Godrej Industries, will raise up Rs 1,157 crore by selling 2.52 crore shares in its Initial Public Offer (IPO) offer.

The company has set the IPO price at Rs450-460 per share, sale of which opened today.

The IPO of the company, part of Godrej Industries, would remain open for subscription till October 6. Out of the fresh issue of Rs 292 crore, Godrej Agrovet plans to use Rs 100 crore for repayment of working capital, Rs 150 crore for repayment of commercial papers and the rest for general corporate purposes. The shares of Godrej Agrovet are proposed to be listed on BSE and NSE.

In four years to FY17, the company's top line and bottom line grew at a compounded annual growth rate of 12.2 per cent and 27.3 per cent respectively. The total bids received stood at 20,57,760 shares while total bids received at cut-off price stood at 17,69,632 shares. The company has consistently reported more than 30 per cent return on equity between FY14-16. The brokerage recommended a subscribe rating on the issue. "At 33.5x, GAVL does not appear expensive". The IPO got subscribed by 11% as of 1145 hours on Wednesday. Godrej Industries owns 60.81 per cent in Agrovet, which is an agri-business company with operations across five verticals - animal feed, crop protection, oil palm, dairy, and poultry and processed foods.



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