JSW Cement to launch ₹4,000-cr IPO in 2024
₹4,000 crore, Parth Jindal, managing director of JSW Cement Ltd, said in an interview. “In 2024, we are planning to take this company public, for which we will be filing the DRHP (draft red herring prospectus) in the next six months. We will be timing the market listing after the national elections," Jindal added.
“We plan to raise ₹3,500-4,000 crore through the IPO route. We are looking at diluting 10-15% in round one, and then over the next two years, dilute the entire 25% that we are obligated to do under the Sebi (Securities Exchange Board of India) guidelines. It will give us enough ammunition to fulfil our organic ambitions." In 2020, the $23 billion JSW Group had initiated plans for an IPO for its cement venture but subsequently decided to postpone it to December 2022 in the wake of the pandemic-hit disruptions in its supply chains and muted demand.
However, the company did not revive the IPO plans then. The company plans to utilize the proceeds of the IPO to fund its expansion plans, and increase capacity from the existing 21 million tonnes to 60 million tonnes in five years. It will be requiring ₹18,000 crore to increase capacity.
While over 20% of its total capital expenditure will come through the IPO, it plans to use its internal accruals as well as raise debt to fund its expansion plans. “The rest will come through internal accruals and then, we will fund it through debt. And, as and when required, we can always do a follow-on round in the public markets.
We can raise a bond; we can do a QIP (qualified institutional placement). So, once we are public, we will have a lot more options at our disposal," he added. The company already has two large private equity backers -- Apollo Global and Synergy Metals.
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