IRM Energy, a city gas distributor located in Gujarat, has commenced its initial public offering (IPO) subscription today, October 18, with a closing date on October 20. The company is seeking to raise Rs 545.4 crore solely through a fresh issue of 1.08 crore shares, without any offer-for-sale, as per details presented in their red herring prospectus submitted to the Securities and Exchange Board of India (SEBI).
IRM Energy operates in Banaskantha (Gujarat), Fatehgarh Sahib (Punjab), Diu & Gir Somnath (Union Territory of Daman and Diu/Gujarat), and Namakkal & Tiruchirappalli (Tamil Nadu). The company boasts a network of 69 CNG filling stations, including two company-owned and operated (COCO Stations), 36 dealer-owned and operated (DODO stations), and 31 stations owned and operated by oil marketing companies (OMC stations).
The price band for IRM Energy's IPO has been set at Rs 480 to Rs 505 per share, with each share having a face value of Rs 10.
Investors are required to bid for at least 29 equity shares and can increase their bid in multiples of 29. Retail investors will need to invest a minimum of Rs 13,920, and at the higher end, the bidding amount will be Rs 14,645.
The allotment of shares for the IRM Energy public issue will be determined and concluded by Friday, October 27. Beginning on October 30, the company will initiate the process of transferring equity shares to eligible investors' demat accounts. Subsequently, IRM Energy is scheduled to be listed on both the BSE and NSE on October 31.
IRM Energy Issue Size
IRM Energy's IPO is aimed at raising a total of Rs 545.4 crore, and this capital will be exclusively sourced through a fresh issue of 1.08 crore shares, without any involvement of an offer-for-sale component.
Promoters and IPO Reservation
The company's promoters are Rajiv Indravadan Modi, Cadila Pharmaceuticals, and IRM Trust, collectively owning 67.94 per cent of the company's shares, as stated in the draft red herring prospectus.
The remaining ownership is in the hands of public shareholders, with entities like Enertech Distribution Management holding 28.65 per cent and Shizuoka Gas Company holding 2.94 per cent of the shares. The public issue comprises only a fresh issue of up to 1.08 crore equity shares. There is a provision for eligible employees to acquire shares at a discounted price of Rs 48 per share.
Use of Proceeds
For the enhancement of its city gas distribution network in Namakkal and Tiruchirappalli, Tamil Nadu, IRM Energy has earmarked Rs 307.26 crore. A portion of these funds will also be allocated to clear a debt of Rs 135 crore, with the remaining capital designated for general corporate purposes.