Hyderabad-based Penna Cement Industries has received approval from capital markets regulator Securities and Exchange Board of India (Sebi) to go ahead with its Rs 1,550-crore initial public offering (IPO).
The IPO includes a fresh issue of Rs 1,300 crore and an offer for sale of up to Rs 250 crore by its promoter PR Cement Holdings, which owns a 33.41% stake in the company.
Penna Cements plans to utilise part of the fresh capital raised for repayment of Rs 550 crore of certain borrowings besides funding capital expenditure requirements of Rs 105 crore for its KP Line II Project. The firm will use Rs 80 crore towards upgrading its raw grinding and cement mill in Talaricheruvu, Rs 110 crore, and Rs 130 crore towards setting up a waste heat recovery plant in Talaricheruvu and Tandur, respectively, the DRHP said.
Set up in 1991, the Hyderabad-based company is promoted by P Prathap Reddy, Pioneer Builders, and P R Cement Holdings Ltd.
Penna Cement, profitable since inception on a standalone basis, has a strong brand recall in the southern and western states of India. It operates out of four integrated manufacturing facilities and two grinding units across Telangana, Andhra Pradesh, and Maharashtra with an aggregate capacity of 10 mmtpa as of March 2021, and its capacity is expected to reach 16.5 mmtpa by fiscal 2024. In FY21 it met 53 % of its power requirements from captive sources.