- The company’s new facility at Anjar in Gujarat, being near the port, will help lower logistic costs given that 50% of the raw materials are imported and 50% of the company’s revenue comes from exports: Chairman and Managing Director Krishan Lalit Bansal
- A discount of ₹19 per equity share is being offered to eligible employees bidding in the employee reservation portion
- Bid /Offer will close on Friday, June 21, 2024.
- The bidding for anchor investors will open for a day on June 18.
- Bids can be made for a minimum of 73 Equity Shares and in multiples of 73 Equity Shares thereafter.
NE BUSINESS BUREAU
AHMEDABAD, JUNE 13
Piping solutions major Dee Development Engineers Limited on Thursday announced its initial public offering (IPO) will open for public bidding on Wednesday, June 19, in the price band of ₹193-203 per equity share of face value of ₹10 each. The investor can subscribe the issue until Friday, June 21, 2024. The bidding for anchor investors will open for a day on June 18.
The company is looking to raise ₹418 crore through its initial share sale.
The IPO comprises fresh offer of up to ₹325 crore and offer for sale of up to 45,82,000 equity shares valued at Rs 93 crore by promoter and CMD Krishan Lalit Bansal at the upper end of the price band. Currently, Bansal owns a 74.74 per cent stake in the company.
Bids can be made for a minimum of 73 equity shares and in multiples of 73 shares thereafter.
“DEE Development Services Ltd will see its logistic costs ease as its new Gujarat facility, which is near the port, commences operations. The 48-acre new manufacturing facility at Anjar in Kutch, Gujarat, will cater to our piping division,” Chairman and Managing Director Krishan Lalit Bansal said.
The exiting mother unit in Delhi-NCR is 1,600 km away from the port; it takes 15 days for transportation, he said. This new facility in Gujarat, being near the port, will help lower logistic costs given that 50% of the raw materials are imported and 50% of the company’s revenue comes from exports, Bansal said.
He said that the current logistics cost net of recovery is approximately 3–3.5%, which is very substantial. Furthermore, the company will benefit from new machines and operational leverage.
The company proposes to utilise net proceeds from the fresh issue towards funding working capital requirements estimated at ₹ 75 crore in FY25, prepayment or repayment of all or a portion of certain outstanding borrowings estimated to ₹175 crore in FY25; and the balance towards general corporate purposes.
Half of the issue size has been reserved for qualified institutional buyers (QIBs), 35 per cent for retail investors and the remaining 15 per cent for non-institutional investors.
This offer includes a reservation of up to aggregating up to ₹1 crore for subscription by eligible employees.
Dee Developments is an engineering company, providing specialised process piping solutions for industries like oil and gas, power (including nuclear), chemicals and other process industries through engineering, procurement and manufacturing.
At present, the company has seven manufacturing facilities, with three at Palwal in Haryana, one each at Anjar in Gujarat, Barmer in Rajasthan, Numaligarh in Assam and Bangkok in Thailand, Bansal said.
The company’s customers include JGC Corporation, Nooter Eriksen, MAN Energy Solutions SE, Mitsubishi Heavy Industries, John Cockerill SA, Reliance Industries, HPCLMittal Energy Ltd and Toshiba JSW Power Systems, he added.
SBI Capital Markets and Equirus Capital are the merchant bankers to manage the company’s maiden public issue. Equity shares of the engineering company will be listed on the BSE and NSE.
