Sanathan Textiles Raises Rs 165 Crore from Anchor Investors Before Upcoming IPO

Sanathan Textiles, a yarn manufacturer, announced on Wednesday that it has raised Rs 165 crore from anchor investors before its initial public offering (IPO) opens for public subscription. The anchor investors include SBI Mutual Fund, Nippon India Mutual Fund, HDFC Mutual Fund, Kotak Mutual Fund, Bandhan Mutual Fund, SBI General Insurance Company, Societe Generale, and PineBridge Global Funds, as per a circular on the BSE website.

The company has allocated 51.4 lakh shares to 20 funds at Rs 321 each, which is the top end of the price range. This allocation results in a transaction size of Rs 165 crore. The IPO will be open for public subscription from December 19 to December 23, with a price band set between Rs 305 and Rs 321 per share.

IPO Details and Allocation

Sanathan Textiles' Rs 550-crore IPO consists of a fresh issue of equity shares worth up to Rs 400 crore and an Offer For Sale (OFS) by promoters and promoter group entities valued at Rs 150 crore. The company intends to use Rs 160 crore from the fresh issue to repay debt. Additionally, Rs 140 crore will be invested in its subsidiary, Sanathan Polycot Pvt Ltd, for repaying or prepaying borrowings. The remaining funds will be used for general corporate purposes.

The company's operations are divided into three yarn business divisions: polyester yarns, cotton yarns, and yarns for technical textiles and industrial applications. These divisions are managed under one corporate entity. Half of the IPO is reserved for qualified institutional buyers, while retail investors have been allocated 35%, and non-institutional investors will receive the remaining 15%.

Investment Opportunities and Listing Plans

Investors can bid for a minimum of 46 equity shares and in multiples of 46 thereafter. Dam Capital Advisors and ICICI Securities are serving as the book-running lead managers for the issue. The equity shares are planned to be listed on both the BSE and NSE.

Sanathan Textiles aims to strengthen its financial position through this IPO by reducing debt and investing in its subsidiary. The company's diverse yarn business divisions cater to various sectors, enhancing its market presence. By securing substantial anchor investments, Sanathan Textiles demonstrates strong investor confidence ahead of its public offering.

This strategic move is expected to support the company's growth plans while providing investment opportunities for different categories of investors.