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Adani Wilmar Ltd, a consumer goods joint venture between Adani Group and Singapore's Wilmar Group, will on Thursday hit the capital market to raise up to 3,600 crore through its Initial Public Offer (IPO).

The IPO comprises fresh issuance of about 15.65 crore shares worth 3,600 crore and the entire proceeds will go to the company. There will not be any secondary offering.

The public issue will open for subscription on 27 January and close on 31 January. The price band has been fixed at 218-230 a share for its public issue.

The proceeds of the public issue will be used to fund capital expenditure, reduce debt and for acquisitions as the firm seeks to become India's biggest food and FMCG company.

On Tuesday, the edible oil major, which sells cooking oils and some other food products under the Fortune brand, had raised 940 crore from anchor investors.

The company has decided to allocate around 4.09 crore equity shares to anchor investors at 230 apiece.

Investors can bid for a minimum of 65 equity shares and in multiples thereof. Half of the issue size has been reserved for qualified institutional buyers, 35% for retail investors and the remaining 15% for non-institutional investors.

Post-IPO, the public shareholding will be 12% and the remaining 88% will be equally held by the two promoters.

According to the Red Herring Prospectus (RHP), the firm proposes to utilise 1,900 crore for capital expenditure, 1,058.9 crore for repayment/prepayment of its borrowings and 450 crore for funding of strategic acquisitions and investments.

The firm's shares are expected to list on stock exchanges - Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) - on 8 February next year.

On the financial front, Adani Wilmar Ltd's revenue increased to 24,957.28 crore for the six months ended September in the current fiscal, as against 16,273.73 crore in the corresponding period of the previous year.

During the same period, profit grew to 357.13 crore from 288.78 crore.

The company posted a revenue of 37,195.65 crore and profit of 728 crore for the full 2020-21 fiscal.

Apart from cooking oils, Adani Wilmar sells food products like rice, wheat flour, and sugar. It also sells non-food products like soap, handwash, and sanitisers.

In the draft red herring prospectus, the company had proposed to raise up to 4,500 crore but later cut the size of the IPO.

After the IPO, the promoter's shareholding in Adani Wilmar will come down from the current 100% to 87.92%.

Addressing a virtual press conference on 21 January, Adani Wilmar CEO and Managing Director Angshu Mallick had said the company would focus on increasing its market share in edible oils segment and grow the food business.

"We are one of the fastest growing food and FMCG companies," he had said and expressed confidence in becoming the biggest in this space in the coming years.

On the reason for reducing the IPO size, Adani Wilmar Chief Financial Officer (CFO) Shrikant Kanhere had said it was done to make the public issue more optimistic and efficient in terms of capital structure.

At present, six Adani group firms are listed on the domestic bourses.

Apart from Adani Enterprises, other listed ones are Adani Transmission, Adani Green Energy, Adani Power, Adani Total Gas, and Adani Ports and Special Economic Zone.

With agency inputs

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