"Drink wine, and you will sleep well. Sleep, and you will not sin," goes an old English saying. Though, it is not sure how many in the market would subscribe to this view, but a lot of euphoria is expected when three distillery public issues hit the market in the coming months.
Chennai-based Empee Distilleries is coming out with a public issue to fund its Rs 182-crore expansion programme while the New Delhi-based Globus Spirits is brewing a Rs 70-crore issue to finance its expansion plans. On getting the approval from the company board, IMFL major United Spirits is also planning to coming out with a follow-on public offering (FPO) by the end of this year.
Empee Distilleries is planning to set up a 60 kilolitre per day (klpd) brewing unit at Nellore, Andhra Pradesh. The company is also planning to set up an 8-MW biomass-based power plant in Tamil Nadu. The company has entered into a power purchase agreement with the Tamil Nadu Electricity Board, which has permitted the company to expand its capacity to 10 MW.
Globus Spirits has plans to increase its distillation capacity to 50 million litres from the current 29 million litres at its plants in Haryana and Rajasthan. "We have got our IPO graded by CARE and have received a grading of 3. Globus will enter the market in early November," said SREI Capital compliance officer Manoj Agarwal.
SREI is the lead manager to the issue. The company also has plans to set up power plants at each of its two distillation units for captive consumption. Globus is also planning to launch half-a-dozen new flavours and brands in the coming months. Though, the market looks 'vintage ripe' for distillery IPOs, there is some scepticism that 'the IPO-savvy Gujarati community' will not participate in the issues.
"We are finding it a bit difficult to find distributors for our IPO. Due to religious reasons, Gujarati and Marwari brokers are not accepting the mandate to distribute these issues. They fear, investors will not subscribe to issues as the underlying business is liquor. We are banking on institutional investors now," said a merchant banker of one of the issues.
Distillery & beverages, as an independent sector, has been doing well over the past one month on the bourses. Share prices of major distilleries have been trading higher in the 6% to 28% range over the past one month.
"Distillery & alcoholic beverages segment has been logging an annual growth rate of 30-35% over the past few years. Almost all companies have embarked on massive expansion plans. Many are also looking at tie-ups for selling light alcohol-content beverages in malls, multiplexes and supermarkets," said Angel Broking equity analyst Girish Solanki.
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Source: ET
Chennai-based Empee Distilleries is coming out with a public issue to fund its Rs 182-crore expansion programme while the New Delhi-based Globus Spirits is brewing a Rs 70-crore issue to finance its expansion plans. On getting the approval from the company board, IMFL major United Spirits is also planning to coming out with a follow-on public offering (FPO) by the end of this year.
Empee Distilleries is planning to set up a 60 kilolitre per day (klpd) brewing unit at Nellore, Andhra Pradesh. The company is also planning to set up an 8-MW biomass-based power plant in Tamil Nadu. The company has entered into a power purchase agreement with the Tamil Nadu Electricity Board, which has permitted the company to expand its capacity to 10 MW.
Globus Spirits has plans to increase its distillation capacity to 50 million litres from the current 29 million litres at its plants in Haryana and Rajasthan. "We have got our IPO graded by CARE and have received a grading of 3. Globus will enter the market in early November," said SREI Capital compliance officer Manoj Agarwal.
SREI is the lead manager to the issue. The company also has plans to set up power plants at each of its two distillation units for captive consumption. Globus is also planning to launch half-a-dozen new flavours and brands in the coming months. Though, the market looks 'vintage ripe' for distillery IPOs, there is some scepticism that 'the IPO-savvy Gujarati community' will not participate in the issues.
"We are finding it a bit difficult to find distributors for our IPO. Due to religious reasons, Gujarati and Marwari brokers are not accepting the mandate to distribute these issues. They fear, investors will not subscribe to issues as the underlying business is liquor. We are banking on institutional investors now," said a merchant banker of one of the issues.
Distillery & beverages, as an independent sector, has been doing well over the past one month on the bourses. Share prices of major distilleries have been trading higher in the 6% to 28% range over the past one month.
"Distillery & alcoholic beverages segment has been logging an annual growth rate of 30-35% over the past few years. Almost all companies have embarked on massive expansion plans. Many are also looking at tie-ups for selling light alcohol-content beverages in malls, multiplexes and supermarkets," said Angel Broking equity analyst Girish Solanki.
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Source: ET
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