Dodla Dairy IPO to open on June 16, price band fixed at Rs 421-428

Dodla Dairy will launch its initial public offering (IPO) on June 16. The issue will close on June 18. The company, in consultation with the merchant bankers, has fixed the issue price band at Rs 421-428 per share.

The Hyderabad-based Dodla Dairy is the third main-board company to launch IPO in the coming week after Shyam-Metalics and Sona-Comstar.

The public-offer comprises a fresh-issue of up to Rs 50-crore and an offer for sale-of-up-to 1,09,85,444 equity-shares by promoters-and-investor. The offer for sale consists of 92 lakh equity shares by investor TPG Dodla Dairy Holdings; And 4,16,604 equity shares by Dodla Sunil Reddy; 10,41,509 equity shares by Dodla Family Trust, and 3,27,331 equity shares by Dodla Deepa Reddy.

Dodla Sunil Reddy, Dodla Family Trust, and Dodla Deepa Reddy are part of the promoter group.

Also read : Dodla Dairy Sebi’s go-ahead to float initial share-sales (IPO)

Shares are available in multiples of 35

Investors can bid for a minimum of 35 equity shares and in multiples of 35 equity shares thereafter.

The company will utilise fresh issue proceeds for repaying debt of Rs 32.26 crore . Which was availed from ICICI Bank, the Hongkong and Shanghai Banking Corporation (HSBC); and HDFC Bank, and for capital expenditure requirements of Rs 7.15 crore.

As of December 31, 2020, the company had a total outstanding indebtedness of Rs 87.37 crore; comprising term loans, working capital facilities and NCDs.

Total issue size’s 50% is reserved for qualified institutional buyers; 35 percent for retail, and 15 percent for non-institutional investors.

Also Read : Dodla dairy files papers for an IPO with SEBI to raise Rs 800 Crores

Dodla-Dairy is an integrated-dairy-company-based in south-India primarily deriving all of its revenue for FY20-and for the nine-months-period ended December 2020 ;from the sale of milk and dairy based value-added products (VAPs) in the branded consumer market.

Third largest Milk procurer in South India

Amongst private dairy players with a significant presence in the southern region of India, it claims the third highest in terms of milk procurement per day with an average procurement of 1.03 million litres of raw milk per day (MLPD) as of March 31, 2021 and second highest in terms of market presence across all of India amongst private dairy players with a significant presence in the southern region of India.

Its operations in India are primarily across the five Indian states of Andhra Pradesh, Telangana, Karnataka, Tamil Nadu and Maharashtra, with brands Dodla Dairy, Dodla and KC+, while overseas operations are based in Uganda and Kenya with brands Dodla Dairy, Dairy Top and Dodla+.

Sale of milk and dairy-based VAPs constituted 72.81 percent and 27.18 percent respectively, of revenue in FY20.

TPG-backed Dodla Dairy had refiled its draft red herring prospectus in February 2021. Earlier it had filed IPO papers in 2018 to raise around Rs 500 crore and received Sebi nod but deferred listing plans.The book running lead managers to the issue are ICICI Securities, and Axis Capital.