Sanstar IPO to open for subscription on July 19; price band set at ₹90-95 per share

Sanstar IPO price band: The Sanstar Limited IPO price band has been fixed in the range of ₹90 to ₹95 per equity share of the face value of ₹2. The Sanstar IPO date of subscription is scheduled for Friday, July 19, and will close on Tuesday, July 23. The allocation to anchor investors for the Sanstar IPO is scheduled to take place on Thursday, July 18.

The floor price is 45 times the face value of the equity share and the cap price is 47.50 times the face value of the equity share. Sanstar IPO lot size is 150 equity shares and in multiples of 150 equity shares thereafter.

Sanstar IPO has reserved not more than 50% of the shares in the public issue for qualified institutional buyers (QIB), not less than 15% for non-institutional Institutional Investors (NII), and not less than 35% of the offer is reserved for retail investors.

Tentatively, Sanstar IPO basis of allotment of shares will be finalised on Wednesday, July 24, and the company will initiate refunds on Thursday, July 25, while the shares will be credited to the demat account of allottees on the same day following refund. Sanstar share price is likely to be listed on BSE and NSE on Friday, July 26.

The firm is situated in Ahmedabad and sells a variety of goods, including dried glucose solids, liquid glucose, maltodextrin, dextrose monohydrate, and native and modified starches made from maize as well as co-products such fiber, gluten, germs, and maize steep liquor. The flavour, texture, and nutritional value of food are improved by their unique products and ingredient solutions.

These are used in a variety of culinary products, including baked goods, confections, pastas, soups, ketchups, sauces, creams, and desserts, as ingredients, thickening agents, stabilisers, sweeteners, and emulsifiers. They also supply industrial items that act as disintegrants, excipients, supplements, coating agents, binders, smoothing and flattening agents, and finishing agents, as well as animal nutrition products that serve as nutritional components.

Sanstar has two production plants located in Dhule, Maharashtra, and Kutch, Gujarat, with a combined size of 10.68 million square feet, or over 245 acres. In addition to 49 countries in Asia, Africa, the Middle East, the Americas, Europe, and Oceania, the company has built a foothold in India, supplying 22 states with its goods.

As per the red herring prospectus (RHP), the company's listed peer are Gujarat Ambuja Exports Ltd (with a P/E of 18.65), Gulshan Polyols Ltd (with a P/E of 73.31), and Sukhjit Starch and Chemicals Ltd (with a P/E of 15.01).

Based on its restated consolidated financial statements, Sanstar's revenue from operations grew at a compound annual growth rate (CAGR) of 45.46% from ₹504.40 crore in fiscal 2022 to ₹1,067.27 crore in fiscal 2024. Meanwhile, their profit after tax increased at a CAGR of 104.79% from ₹15.92 crore in fiscal 2022 to ₹66.77 crore in fiscal 2024.

Sanstar IPO details

Through its IPO, the company aims to raise ₹510.15 crore. The IPO consists of an offer-for-sale (OFS) of 1.19 crore shares valued at ₹113.05 crore by the promotersand a fresh issue of 4.18 crore equity shares valued at ₹397.1 crore by the firm.

Richa Sambhav and Samiksha Shreyans Chowdhary will each be selling33 lakh shares via OFS, while Rani Gouthamchand Chowdhary will be selling 38 lakh equity shares through the OFS. The other selling shareholders among the promoters are Gouthamchand Sohanlal Chowdhary, Sambhav Gautam Chowdhary, and Shreyans Gautam Chowdhary, who are each offloading 5 lakh shares.

The proposed uses of the net proceeds of the new issue include financing the capital expenditure needed to expand the Dhule Facility, repaying and/or prepaying, in full or in part, some of the company's borrowed funds, and general corporate purposes.

The sole book running lead manager is Pantomath Capital Advisors Private Ltd, and the offer's registraris Link Intime India Private Ltd.

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