VLCC, Parag Milk, Narayana Hrudayalaya may file for IPO this month

Mumbai: At least three companies—Parag Milk Foods Pvt. Ltd, VLCC Health Care Ltd and Narayana Hrudayalaya Ltd—are expected to file draft initial public offer (IPO) papers with capital markets regulator Securities and Exchange Board of India (Sebi) before the end of September, according to four people aware of the development, who requested anonymity as none of them are authorized to speak to the media.

While Narayana Hrudayalaya is looking to raise around ₹ 700 crore, Parag Milk Foods and VLCC are looking to raise ₹ 900-1,000 crore and ₹ 600-700 crore, respectively, the people mentioned above said.

“Firms are rushing to file their draft papers with Sebi by September-end, as they can file with full fiscal year 2014-15 numbers if they file now. Else, they will have to file with data till 30 June 2015, which in some cases might not yet be completely in place,” said the first person mentioned above.

Also, for firms which are looking to list in the first half of 2016, it makes sense to file now as they can have the approval in place in the next three to four months, he added.

In December, Mint reported that Parag Milk Foods was in talks with investment banks for an IPO.

Emails sent to VLCC and Parag Milk Foods did not elicit any response, while Narayan Hrudayalaya declined to comment for the story.

Apart from raising primary capital to fund business expansion and pare debt, IPOs will also help private equity investors in these firms to make partial exits, said the second person mentioned above.

“Almost 10% of the VLCC issuance will be an offer for sale by existing investors and promoters,” said the third person mentioned above.

Parag Milk Foods counts IDFC Alternatives and Motilal Oswal Private Equity as its investors. Everstone Group is an investor in VLCC and Narayana Hrudayalaya is backed by CDC, the UK’s development finance institution, and JPMorgan.

So far this month, two companies have filed draft papers with Sebi—diagnostic and pathology laboratories firm Dr. Lal Pathlabs Pvt. Ltd and staffing services firm TeamLease Services Ltd.

The number of IPOs has been picking up since late last year. Data from Sebi shows that 28 firms have filed their draft IPO papers with the regulator in 2015 so far.

So far in 2015, 15 firms have raised about ₹ 6,348 crore through IPOs, according to data from Prime Database.

This is already more than the entire sum raised in the last two years. In 2014, five firms raised ₹ 1,201 crore from the IPO markets, data from Prime Database shows. In 2013, three firms raised ₹ 1,284 crore.